From The Daily Mail:
Theresa May hopes to deepen ties with Qatar after the oil-rich Gulf state announced it will invest £5 billion in the UK over the next few years...
Sheikh Abdullah said: “Over the next three to five years, Qatar will invest £5 billion in the UK economy through various investment funds and relevant parties in Qatar – which will constitute another addition to its already successful investments in the UK.
“Our investments in the UK will focus on energy, infrastructure, real estate, services and other sectors.”
Qatar already has more than £40 billion invested in the UK, including ownership of London’s tallest building The Shard, Harrods department store and the Olympic Village.
This is not "investing" in any meaningful sense, they are collecting rents from the UK economy and subsidies from the UK government (like snapping up the Olympic Village for half price, or buying into top-down privatisations of public services).
Which is what happens when you tax the productive economy and subsidise land (or provide government guaranteed income). Why bother with proper, productive investment (factories, new businesses, innovation etc) when you can just tap into existing government-backed rental streams?
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6 comments:
In fairness to the Qataris, some of their "investment" might have involved some actual investment- some risk taken by actually building a building maybe? I agree that 95% will just be rent seeking however...
Unrelated I know, but I remember going to some talk on Argentinian politics- who would be the next president etc. a couple of years ago. One of the speakers started talking about what this all meant for "overseas investment"- which it quickly turned out meant real estate "investment"- and I asked him why he thought it was investing- to buy property. His response was to state that the type of investment he was referring to was the one 95% of his investors (he was some sort of guru) were interested in, and so he was sticking with it. Says it all really I thought...
TBB, yes, some of it is new stuff, like a building, but what they want to collect is the rents from the building i.e. from the location i,e, from the UK economy/government.
Your adviser is just making the same traditional mistake of conflating land and capital, of conflating buying up existing stuff (shares in a mature business) with spending money on creating new stuff/businesses.
Agreed. Same old UK. When you take everything else off a Brit, reducing him to his core, you will find a rentier.
Isn't this just the other side of us buying LNG gas off them? They end up with £'s to sell or to spend, they have a big trade surplus that the royals don't want to trust the plebs with, so they set up a SWF and buy £ assets.
Hasn't this been going on donkeys?
BF and SL, yes, sadly.
BF, we haven't shaken off centuries of rentierdom being the only way of social advancement. It's etched deep into the national psyche.
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