 |
||
This article recently appeared in the Birmingham Post, please click here for further details. Our government sought to use the Budget as an economic development tool, with a significant package of measures designed as a financial stimulus to encourage clean technology and green manufacturing, but things are a little different ‘across the pond’. I joined a group of business leaders in the US last week, to hear first hand about the US 'green stimulus’ package and was struck by the opportunities for UK business presented by President Obama's proposals. The American Recovery and Reinvestment Act of 2009 contains over $780 billion in tax cuts and spending programmes over the next 3 years. It targets spending on environmental projects, including about $25 billion in grants for energy related schemes. This includes $2.5 billion for approved research, development and deployment projects - including biomass and geothermal energy. A switch to more electric transport will be encouraged with $2.5 billion to support the development and manufacture of advanced vehicle batteries and components. The ambition represented by this stimulus package is on an altogether different scale to our own and suggests there is no better time for Midlands companies to do ’green‘ business in the US. However, I detect reality now setting in, as the various US agencies come to terms with exactly how they spend such large amounts of money. The heavy wheels of US government contracting cannot get into gear fast enough and businesses can expect to negotiate reams of red tape. It also appears that much of the money will be passed down from federal government to individual states to spend via their various state agencies. This makes it hard to track the opportunities, as many of the spending decisions will be made at a local level. It doesn’t help that there are as many different procurement law and regulations for local government contracts and spending programmes as there are states in the US. This makes bidding for public sector contracts in the US a minefield. Furthermore, as the US begins to see green shoots in its economy, pressure will mount on Congress to rein in these spending plans and have a rethink. Ben Bernanke, the Federal Reserve Bank chairman states the US must now get serious on debt reduction. Midlands businesses wanting a slice of this action also face the spectre of protectionism. The US economy is struggling with job losses and closures and local jobs for local workers will certainly be a priority for the state agencies. Despite all of this, with a stimulus package of such scale, it is hard not to conclude that the US will become an increasingly attractive place for doing business in the green economy. For further information please contact: Andrew Whitehead, Partner
|
||