Chatham House Forum: Will Super-Cities Destroy National Economies?

Suki Basi

[Applause] Right, apparently, I’m all miced up. Can everybody hear me?

Audience

Yes.

Suki Basi

Good afternoon everybody. Thank you for the opportunity, Ellie, for speaking to – just about here?

Ellie Groves

Just put it there. Sorry, no, that’s the clicker.

Suki Basi

Oh, okay, no, no. I know where the clicker is. Thank you very much today for the opportunity of speaking to you about Will Super-Cities Destroy National Economies? Before I even start, how many – if I can have a show of hands. How many people are actually living and working in London in the room? How many people are living and working in Greater London? South East? Outside the South East? Okay, a few. Outside the UK? Okay, right, so this question, as far as I’m concerned, centralisation and distribution, Will Super-Cities Destroy the National Economy? In my view – and this is my personal view, I think that they do and the reason for this is for two reasons. One is, undue concentration of wealth, power and economy and culture in one place is damaging to the national economy and, secondly, the forces of risk connectivity threaten cities in a way that the barbarians at the gate threatened super-cities in the past.

So, over here we’ve got a chart that actually shows the centralised model, in which we operate today, where London is a pivotal role, acting as a concentrator of knowledge and the flow of individuals to the city state that is London. Now, this is all well and good. You can see the flow quite clearly there. At the same time you can see the flow out into the regions, and this is something I want to sort of highlight later on and get into the distribution of wealth as well. So, we have concentration of people in one place, but those people are pretty much geared towards focusing on the opportunity and that’s because, in people’s view, opportunity exists in London and London only within the UK. In my view, we need to move to a much more resilient and distributed society, where opportunity exists all around, and one of the reasons for that is, as we move from the offline to the online world, opportunity flows all around us, and we should be looking at the opportunities in a way that’s presented locally that we can actually provide globally.

So, the whole super-city aspect is nothing new. Urbanisation has been growing throughout – from the 18th Century. In fact, in the 18th Century, which doesn’t show up on this graphic, only 3% of the world’s population lived in what is termed, a city or an urban conurbation. Somewhere between 2010 and 2014, we moved to a society where more people lived in cities than lived in the rural regions. Moving onto 2030, when London finally becomes a mega-city via the UN definition, being ten million, one in eight of the planet will be living in mega-cities, and the aggregate population of these 41 cities that appear on the UN graph to my left and right is, just shy of a billion. So urbanisation is there, it’s been growing gradually, so what do we do?

Well, the first thing we have to do is actually define what a super-city is. Super-city is the concentration, as I’ve iterated earlier, of economic, political and cultural power. By any measure, London is streets ahead of most cities, but the one aspect to bear in mind is in the leading economies, and particularly the leading economies in the world that is 2030, Brazil, India, China and the US, that particular paradigm doesn’t exist and in the top ten economies, maybe we’re only talking about France, Japan, Tokyo – France, Paris and London, UK where that actual paradigm exists. So, we have to be mindful of what seems to be working and what might not seem to be working, and the other aspect to all of this is that the one thing that makes London so great, and I was driving in, in a taxi today admiring the skyline of London, it’s actually where people want to be. So, let’s not get too negative about it. It’s a great place to be, however, if we’re going to watch the competitive forces that I’ll allude to later, we need to be mindful of the fact that we need to actually integrate better into the economy.

So, the next few graphics are rather boring, but they’re actually quite important to illustrate the way in which a super-city function and a super-city status can actually effect the average person. The first thing I’m going to focus on is wealth. So, the most important and startling aspect to all of this, there are ten nations that combined and aggregate together to actually hold 73% of personal wealth. Now this is actually echoed similarly in corporate situations.

If you took all of the corporates, globally, I don’t mean corporates, all companies globally actually, there is about 180 million companies, as defined by Dun & Bradstreet and actually, collaborated by Bureau van Dijk. The combined revenue of those companies is somewhere North of $215 trillion, actually very similar to that number on the board there, and if we were to focus on the billion dollar club, those companies that are actually – whose revenue ends up being just around a billion dollars and above, one-third of all revenue of companies is actually contained in those 1,000 companies. These 1,000 companies are so big that the sun never sets on some of their enterprises. So, we’re dealing with a scale that’s probably unprecedented, in recent time.

So, this also, is quite interesting. Surprisingly, London being number two and quite close to New York but there are 11% of the same wealth distributed in just 15 cities. So, this one is an interesting aspect. So, by far the biggest economy, from a GDP city perspective, is Tokyo, but London still remains in the top five position. Interesting enough, probably sharing the same attributes as New York and LA combined, but if we were to look at London separately, as an economy by itself, it actually functions as a G20 economy, just, and the UK, without London, is a G10 country, just.

Now, when I was trying to put this together, I was trying to illustrate how wealth could be distributed or prosperity could be seen across the country. So, I came across this graphic from Barclays Bank, and this is the thing that’s probably most dark, in the sense that the flow of people from the regions into London and then the flow of people from London to the South East and East of England, echoes quite well in this prosperity slide.

First off, London being the most prosperous area. The next being the South East and the next being East of England. So, there are the concentration of wealth, as people migrate back out of London, having migrated in, in the first place, but actually, if you start looking North of that region and West of that region, the prosperity picture is completely different and, arguably, the Brexit vote is actually contained quite similar in this graphic, albeit with the cities removed because we actually already have a two state system. In the sense that wealth is concentrated in and around London and not necessarily flowing out to the regions, which is probably systemic, in some respects, but reflects the fact that people view opportunity mostly in London, and that’s where everybody wants to be.

So, services is the driver, as echoed by Sadiq Khan this weekend, on the Andrew Marr Show, dominates the British economy. The most interesting thing, besides the domination of services, is actually what’s happened to agriculture from the 18th Century. Occupying quite a prominent position in the 18th Century, in terms of share of GDP and now operating just 1%, arguably, it’s almost a meaningless contribution. However, the most startling aspect to all of this is that actually, it feeds 60% of the population with just 1% of the GDP. A mark of what’s to come. A mark of how technology can actually effect a sector and drive inefficiencies, so that so much manpower isn’t needed and I guess, this is the beginning of maybe what digitisation could do for us, both positively and negatively.

So the service drive exists not just in the UK. It’s actually in the G5. China being the most notable expansion point, in recent times, and you know, when we look at China, we view China as a product company – a product country, sorry, but that’s actually beginning to change and that rise there is quite startling, if you actually compare that to the other countries in the graphic.

So, this one’s interesting. This one’s interesting, purely for the fact of how services are taking the share of income within the UK, a proper 12 sectors within the UK, and the reason why I’ve actually laid this out is that it actually shows a healthy penetration of services, across the regions in the UK and, as was aired in The Andrew Marr Show, and I’m not plugging that. It’s only because the numbers are the same, really, so I came up with some completely different perspective and we ended up with the same number. But the reason for why this is so important is that when you get to the next slide, you begin to realise how productive, and this is the measure, to measure the GDP, how productive other parts of the UK are, and really, if we’re going to start to fix the problem of overconcentration, this is what the beginning of the picture is and what the focus point of the national policymaking should be.

Just a few percentage points changes in the aggregate could mean a lot of change nationally. So, how do we start to look at that? Well, the first thing we need to be mindful of is – and apparently, there’s somebody from JLL here today. Is there somebody from JLL here today? Yes, thank you for this slide. I was looking for a slide and actually…

Member

Okay, I wasn’t personally responsible for that, but…

Suki Basi

Yeah. Oh, you will take responsibility today. Take it, I’m offering it to you. I was really keen to come across something that helped me position the argument, and not that I was scrambling around. It’s quite important to actually bring in lots of different viewpoints, and the JLL graphic, which actually came from WF, this, and I’ve actually managed to look it up. There’s no surprises here, on the one aspect. The top seven is the top seven, but what’s more startling for me is the fact, the lack of any other UK city in it, and that just shows our reliance. Even from a present or from a future perspective on London, we used to say that the US – when the US catches a cold, the world catches a cold. Actually, if the US and London were in the same events, that would aggregate and cause us great harm. So, that is actually the beginning of my whole distributed aspect. How do we guard against the resilience of that?

The first thing we’ve got to begin to realise is, is that the events space, global events, and we don’t need to go too far. Some of the events of the last week have really started to crystallise the way in which the world is moving, arguably you may say that we’ve rebooted and woken up in the 1980s. We’ve got a Movie Star come – a Movie Star President, we’ve got the beginnings of a cold war. We’ve got Russia that’s seemingly is doing its own thing. However, what we’ve got to do is actually begin to understand some of the reasoning for those events and in my view, what’s driving – what’s really driving this is the fact that from the 60s and 70s, we’ve gradually coupled businesses. We’ve outsourced. We’ve insourced. We’ve cut supply lines, we’ve tried to optimise our inventories and, as a result, I suppose, today all businesses are more tightly coupled. A shock locally is felt globally. A shock globally is felt locally. In fact, local is global. Global is local. So, we’re already in the state where events can aggregate and cause us harm.

Now, the classic one is the cyber situation. There’s a lot reported of cyber record hacking and extortion and monies being paid and fines being levied. However, not a lot is being said of the nation warfare that’s going on behind the scenes, hitting key assets and stealing corporate IP. Allied to the fact that we have tension in the world, the haves and the have nots, East, West of offline/online. We really are in a truly connected space and it’s this aggregating risk, the connected risk that we mostly need to understand and begin to get our heads round because for the first time, this risk knows no boundary.

So, uncertain worlds, lots of risk, but actually, there’s lots of opportunity too and it’s the opportunity that I want to focus on today because I think that enough’s said of the risk. If we ever were scared about risk, we would never trade globally and we need to reach out and actually seek the opportunity when we see it. So, from our perspective, this flag means a lot of things, and I’m not on a political stage today, even though I’m on a – in a think tank. But really, I grew up in the 80s, a sick man of Europe is what people said about the UK. Quality was a million miles from any product or services that were delivered. Today, we’re in a slightly different space. The Foreign Office views itself as Global Britain. London happened to be a Global City. 75% of UK customers trust ‘Made in Britain’ and 60% of US customers view ‘Made in Britain’ as quality, but it’s not just the quality agenda we need to focus on.

We need to seek into the brand and actually understand the relationship, in history, of tolerance, innovation and trade. These things have actually been working in harmony or disharmony at different points throughout history, but in the end, we’re a trading nation and we need to actually exploit the opportunities that that creates and the central pillar for that is innovation, as I see it. So, how do we rebalance towards a more resilient economy? Nowhere in this am I actually viewing London as a negative. London is a true positive aggregator of risk and opportunity. How do we disseminate it to create opportunity that’s inclusive for all? To actually create the least route to market, the most optimum route to market. I think, the one thing from all of this is to understand is that from the Winter of Discontent in the last 70s, I think, the Government’s been a constant. It’s gone from one colour to the next, but it’s been fairly constant in the way it operates. Yes, we’ve driven some costs out and then we loaded it back in again.

But out of all the Western economies, the local tax take is the lowest in the UK. So, we’re actually missing out on local people making local decisions to help them within a national policy that actually, is focused on helping us move on and be more resilient. So, I think the Government needs to change, but it can actually help others to change by actually focusing on innovation, talent, the infrastructures needed to encourage that relationship, so that we can actually export more and create stronger resilience, sustainable relationships. So, let me begin by the innovation piece.

This was a graphic that I found from the university, or not university it was the Bureau of Statistics in the US that gave a typed correlation between numbers of universities and GDP. Now, in the UK, we’re fortunate in the situation where 16 out of the top 100 universities are actually based in the UK. Ten – four out of the top ten are based in the UK. Two – arguably, two if not three out of the top five are based in the UK.

We’re in a quite interesting situation where universities are contributing 3% towards GDP, but I don’t necessarily just want to focus on universities. I mean, universities, arguably, could be in the next industrial age, the cot – the equivalent of the cottage industries of the past, but these need to be brought into a framework that actually encourages the development of talent. This isn’t just young talent. We should be recycling older talent because we don’t want to be in a situation of having the same generation mistakes made time and time again. We need a sustainable growing economy. So, how do we do that?

Well, we do that by actually creating policies that actually focus on the development of talent. Now, to some extent, we – football didn’t come home, but St George’s Park did play a pivotal role in at least changing our view of football performance, but it’s actually shown no better than actually, in the way in which Team GB, in the Paralympics bodies, have actually managed to be so successful. They’re focused in on what matters and use data analytics to actually enable them to succeed, and sports science.

So, we need to have a system that actually encourages talent and the way in which – I think the role of Government has to be orchestrate. Orchestrate, orchestrate, orchestrate throughout. Not necessarily meddle. Help, be the budget holder, but actually help the co-ordination between business and talents and talent, really, is nurtured through schooling into universities, rather than business. Always moaning about the lack of talent, actually, be involved in a debate to shape the talent but, of course, then, we need the infrastructure and the healthcare and the welfare to support the best talent, because talent could exist anywhere. I mean, it could be [inaudible – 21:33], who knows.

Right, so, infrastructure. I suppose the infrastructure point – I mean, I live in Nottingham. I’m already a distributed company. I’m a net exporter. I moan and groan about the trends, but in the end, I know it’s going in the right direction, you’ve just got to believe it’s going in the right direction, but I think a system that’s integrated, available. Available, affordable to the people, wherever they’re seated within the country is important. A strong link to London, in the short-term, is important. A system that actually enables us to deliver clean affordable energy is also important, but in the end, technology, and certainly innovation and talent development can actually help in this area.

We’re actually, just about to actually move into a system where we’re going to have a drive towards the Internet of Things. So, we’ll be flooded with data. We should be using this to actually help drive innovation within the infrastructure system to actually make it more available, cheaper and accessible to all, because in the end, we can use all this technology that we’ve learnt and we can export it, in the same way we did in the past and building those links, not just nationally, where the orchestration roll is pivotal for the UK Government, but actually, allow local links too, to form.

So, there was a graphic earlier, which showed London Heathrow being the top connecting airport by cities. Interestingly, when I looked down the list, 14 on the list was Manchester. So, I’m pretty sure the Premier League has actually helped there, and we could laugh about the Premier League, but actually, we – anything that actually helps promote Britain is important and sports are actually an integral part, as is culture and the politics. So, with the National and Local Government aspect, I’ve already said, growing up from these – I was born in 64, by the way, so I’m pretty old, and – but my first memory of politics was actually, the Winter of Discontent and from there on really, I think, rather than disconnecting with society because we’re living in a quite changing time. I think Government needs to re-find its focus and actually operate in an environment that actually encourages as much local interaction as possible. So, we can only do that by actually devolving some power and allowing the local economies to actually develop and flourish, in a framework that works nationally, but also, encourages local entrepreneurship.

So, I’m hoping, in this way, we’re actually in a situation where we’re much more distributed, much more connected and ready for the opportunities that a distributed model can create. So, thank you for your time. Ellie, I think, at this point, as you said, it’s time for Q&A, and just when the mic passes by to you, if you could just – if you do want to ask – oh, here we go. If you could announce yourself, sir. Be gentle with me.

Bernard Herman

I certainly would be. Hello. I’m Bernard Herman a Member of Chatham House. One thing I think – in your excellent talk, one thing you did neglect to mention, was the political aspect, which frequently underpins with the result of the growing discrepancy in the large cities in the rest of the country. We see this in the United States with President Trump. We see this in Europe. Increasingly, seen this in Britain with Jeremy Corbyn. Would you consider the cities, as the innovator, the agents of globalisation would increasingly be the new division within politics with the globalised cities and the national hinterland and there’ll be the constant tension between the two, in that in many countries, the majority of a population were not to live within the globalised cities? You did not mention this in your excellent lecture, but would you care to comment?

Suki Basi

Right, could you actually give me – so, is your argument that…?

Bernard Herman

Isn’t it between globalised – it’s a great description, globalised cities and national hinterlands and how they vote and influence each other?

Suki Basi

Yes, well, arguably, the Brexit vote was the revenge of the cities that didn’t matter. Right, so, if we just focus on the UK for a minute, right, because I’m not a Politician. I’m here ‘cause I’m generally passionate about this subject ‘cause I want us to all succeed. I voted to remain, but I’m actually in a situation where I’m actually quite intrigued about the opportunity on the other side. So, I think we need to actually be an inclusive – we need to operate an inclusive model. I’m completely aware of the fact that cities dominate.

Cities are almost creating the ability to actually set their own trading relationships, right, at the expense of the National Government or undermining the National Government, in some respects, but if we want to avoid the situation of Brexit, then we’ve got to find a way of allowing innovation to flow, for opportunities to be available wherever, anywhere. In a distributed system and particularly in a digital world, we only have to look at what’s happening to social media and the development of superstars, without actually having ever lifted, you know, a corporate pen or even left the bedroom, right? So, we are creating new routes to market. We’re creating new opportunities all the time, but we don’t want to be in a situation, like we were in the 80s, of leaving parts of society behind. If we keep doing that we will have the same situation of super-city v hinterland. There’s enough experiences with the barbarians at the gates to what will happen. I don’t know whether that answered your question, sir?

Bernard Herman

Thank you, it did, yes.

Suki Basi

Yeah.

Kenneth Mackintosh

I’m Kenneth Mackintosh, Chatham House. I’m very interested that you seem to believe that we should decentralise a lot of power and influence from our one megacity and it’s quite exciting to see what might be happening in Manchester and thereabouts. Perhaps a little bit less so in Merseyside and then you move…

Suki Basi

I don’t believe – I’m sorry, I don’t believe we are devolving any power at the moment.

Kenneth Mackintosh

Oh, we’ve devolved some money.

Suki Basi

Yeah, money. Yeah, okay, well, that’s…

Kenneth Mackintosh

We devolved some power and some money to Scotland and it’s failing spectacularly. Their educational system is failing in the primary and secondary schools. Their universities are really struggling because of this wonderful idea of free education, so the whole of Europe wants to come for free education, so much that they’re restricting Scottish entries to universities. Their Local Governments are not doing terribly well, how are we going to address that? Are we going to have to take back control, or are we just not going to – and I’ll stop there.

Suki Basi

No, no. No, no. No, please. Please, I’m actually – you were going to say something else add please finish. No? Okay. Right, okay, interesting question. I think, and this again, this is my personal view, it’s slightly off the subject, but because I’m intrigued, I’ll answer it ‘cause I can. It’s a free world. I think that we need – we don’t have a – you know, we’re a Union, but we don’t have a National Union Policy. It’s not really inclusive. We were devolved. We’re actually really devolving, so that’s created tensions in the sense that it actually allowed people that want to split, a situation where they can do, to some extent, whatever damage they want to do. However, I think that from the National perspective, we shouldn’t necessarily view too negatively on the situation in Scotland. I think we should learn from it. Learn how to actually embrace that level of devolution and how we can improve it and actually, again, I mean, you mentioned Manchester.

We’re in danger of the actual cities being Barons of the North or being a different colour to the National Government, but then, what does it matter? We need a national identity and we need a national policy. This is actually outside of Politics. To some extent, the Politicians are probably meddling too much in the state of affairs and actually holding back innovation and infrastructure and talent development and leaves the average person with no choice but to seek opportunity in the super-city.

Kenneth Mackintosh

So, would you allow some of the regions to fail, economically?

Suki Basi

I think there’s enough – well – right, let’s not focus too much on the situ – we know enough – we’ve got enough experience of what works and doesn’t work in the health system to learn how we could – and in the rail system. Now, nobody actually learnt anything without failing, so failure isn’t a bad thing. So, I think we should learn to fail because as long as we improve and get better the next time.

Peter Price

Peter Price, former Member of the European Parliament. My question is, what can we learn from other countries, in the sense of where in the world would you point to a country, which has made choices that have led to success in achieving a greater balance and, especially, things moving out of the large cities towards the other places within the country, as a result of choice not just that the country is big and therefore, things have grown up in other places.

Suki Basi

Well, there probably isn’t one that comes to mind that I can think of, to be completely honest, but I’m going to answer that question slightly differently. We’re a quirky nation and we’ve got people that are successful that have probably never gone to school, never gone to university. We’ve developed in different ways and the thing about from the outside-in, is that everybody wants to come to London and the UK actually stands for, you know, a beacon of opportunity in that respect, when you entwine it with the London experience. However, also, to some of those successful nations that you cite, the big countries, most of the citizens there want to come to the UK because they see opportunity, not just in London, but elsewhere. The Chinese are building strong links to other parts of the UK. People see talent outside the UK. Maybe we don’t love ourselves enough.

Peter Price

Are you suggesting, therefore, that the UK has actually been relatively successful in distribution of…?

Suki Basi

No, I think it’s starting. It’s starting. It’s been a slow exercise, it’s starting. The BBC moving up to Salford, you know, the FA thinking about giving up Wembley. Setting up St James – St George’s Park, these things are all recent. I think the Labour Government tried it, tried moving parts of the Government across the regions and the next Government, the Coalition came and changed that. So, I think it’s – this experience that’s happening, been going up and down, but it’s in the hands of the Politicians that keep on changing it one way or another. I think we’ve got to begin to realise that outside of London, there is lots of opportunity and lots of innovation, if encouraged. To some extent the Government has to almost be a farmer. It needs to recognise the opportunity and invest in it properly because, in the end, what are we left with the centralised model? Does it just get bigger and do we – we have the situation where the people outside just vote against it, for whatever reason, ‘cause that’s what will happen?

Ashoto Shiasti

Hi, Ashoto Shiasti. I have a follow-up to the question that Peter asked.

Suki Basi

Oh God, you’re attacking me now, aren’t you?

Ashoto Shiasti

No, no, no. The question is, I was, you know, Peter’s remarks got me thinking about should a specialist driven city, such as, you know, Los Angeles or Bangalore or, you know, Frankfurt for finance. So, is Germany one of those answers of creating different specialised cities and therefore, diffusing the problem of centralisation? But, the second question really is, should such cities actually aspire for megacities? Is it a price worth fighting for?

Suki Basi

What, to become a megacity?

Ashoto Shiasti

Yes.

Suki Basi

Well, it’ll be interesting if we look forward in ten years’ time, if we could do that, because I think a lot of these studies don’t necessarily factor in the impact of the online world. The online world doesn’t know a boundary and as I intimated earlier, businesses are so connected there are no boundaries. At any one time, it’s aggregated at a point, so people feel as though they need to be in it, but if our jobs are changing and everything’s becoming increasingly online and accessible would, you know, we actually, potentially, if we don’t do this, have the reverse situation. This could be, in five or six years’ time, Liverpool as it was after the 80s. I’m just throwing it out there because why not?

I feel this is going to be a funny question, no?

Janice McLean

No, actually, quite serious.

Suki Basi

Oh, God.

Janice McLean

One of the aspects that – sorry, Janice McLean, a Member of Chatham House. One of the aspects that I’m particularly interested in is in anti-money laundering and so on, and London is a centre, well-known across the world that it’s one of the biggest focal points for laundering money. Have you taken this into any account when you’re judging the size of where you place London in this and the percentage of the economy of London that is actually unlawful income?

Suki Basi

Well, I – well, to be brutally honest, I don’t think we’ve got a choice, have we? ‘Cause what would happen…?

Janice McLean

No, I’m asking you if you’re actually taking that into account in describing London as a super-city ‘cause there’re obviously other bigger cities? There are other richer cities and a subpoint of that is, are you looking at, you know, income per head or wealth per head of the population or, how do you balance that? Because there are wealthy pockets all around the world, it’s just that London has different attractions, but unfortunately, one of them is that it’s a centre for money laundering.

Suki Basi

Yes, I mean, the – London is a concentrator of wealth, as I’ve said already, in one of the slides. It’s the second most concentrated city for wealth, after New York, and the danger is, as you quite rightly say, what happens in a situation where we become slightly distributed and more liberated to that money. Now, I’m not a policymaker, but I can only give you my views. I don’t know what percentage of that money is laundered. Maybe you might want to hazard a guess, but if it’s – if it…

Janice McLean

We didn’t actually know, but we know that it’s a considerable percentage and that is always going to be a part of how you come to your decision about London being a super-city.

Suki Basi

So, you don’t think London is a super-city?

Janice McLean

And I don’t know. That’s why I’m here tonight to hear what your reasoning is behind it, but a big part of this is the fact that we’ve become this centre for money laundering and therefore, how much of that is good or bad for the country and – but for me is, have you taken that into account in your message?

Suki Basi

Well, I suppose from that perspective, my definition of the super-city is the concentration, economic, political and cultural power. We don’t actually have any other city that comes anywhere close when you combine the three. Part of it does, part of it doesn’t, and the other aspects to all of this is that London happens also, with the lens of the UK economy, act as a pivotal aggregator for politics. So, it can take the money, but also, set policies that actually helps to actually change in the way in which we’re seen and how we integrate. So, in the end, in the short-term, we’re not going to see this money disappear because where else can this money go? It can only go to New York for a full service, from what I’m led to believe. New York wouldn’t touch it.

Saad Aldouri

Saad Aldouri, I’m a Researcher here at Chatham House. So, I think, more than ever, we live in a time where multinational companies have greater influence over issues of governance, alongside, obviously, the National Governments. I think, you know, you could quite easily make a link with that and the kind of protectionist measures that we are seeing around the world today. So, with that in mind, how do you see the interaction between multinational companies and Governments in addressing this issue of decentralisation when, arguably, you know, multinational companies don’t necessarily see it as beneficial to them to kind of take their money out of London, take their money out of other big cities, and take it into, you know, Birmingham, Liverpool or other cities?

Suki Basi

Well, the Foreign Office views itself as Global Britain. Can somebody tell me what that means? But I think I can only offer up what I think it means. I think the UK, actually, wants to be a pivotal position in global politics and in that state, we are constantly wrestling between citizens’ needs, the needs of the companies and the needs of the trade relationships between our trading partners. So, I will find a way, we will find a way ‘cause we always do.

Duke Oputa

Duke Oputa, Chatham House Member. To what extent will tolerance of transnational migration contribute to the truth of super-cities in the future, especially from the point of view of attracting talent from, you know, around the world as opposed to from, you know, within the country?

Suki Basi

So, how do we manage migration?

Duke Oputa

Well, for instance, I mean, take Trump’s rhetorics on migration to the US, will that help to build super-cities in the states in the future or will it actually be a negative – have a negative impact in that respect?

Suki Basi

Well, actually, for the first time, I think I was saying – talking about this earlier. For the first time what we hear and what we see may not be what’s happening because there are powers that are at work here. I probably think it’s due to East-West’s have/have nots, online/offline. We’re actually moving to an environment, if we are not careful where policymaking isn’t elevated across that agenda, where, if we’re not careful, corporates have more and more control and if they have more control, there is no super-cities.

Andy Parfitt

Andy Parfitt, Chatham House Member. Re the connected world that you’ve eluded to a couple of times, the promise of connectivity was that it was always going to reduce the concentration that you’ve also talked about, but physically that is, but actually, the trends show that it hasn’t done that.

Suki Basi

Not yet.

Andy Parfitt

So – well, yeah, so Silicon Valley, famously, Los Angeles for music and filmmaking and so on, and I wonder what you think is going to change to reverse that trend that we’ve seen over the past 15/20 years?

Suki Basi

When people realise they can trade themselves and seek opportunities themselves and have a platform to engage directly with their target audience, which is already happening in the entertainment industry. So, when we get more and more connected and it’s – and the regulators don’t wake up to more, I suppose, flexible schemes, then we run the risk of the customer becoming even more powerful and knowing his own route to market.

Andy Parfitt

I hear that, but I think, in my experience, even the entrepreneurial state, sort of start-up individual, small businesses have still tended to concentrate physically in those areas of the world where already, those concentrations exist.

Suki Basi

Yes, so, you know, whether it’s a science park or a hub, yes, but as I alluded to earlier, there is even opportunity in [inaudible – 45:33] and Hollywood, actually, plays quite an interesting part in actually opening up some of these challenges that we’re facing. So, yeah, I don’t want to talk too much. I’m starting to dry up. Oh, Ellie, we’ve still got another ten minutes. Where is she? Oh there we go. We’re almost there.

Nicole

Nicole, King’s College. I had a question about development and bring you back to the earlier questions tonight about how these cities have been a driver of economic development.

Suki Basi

Sorry?

Nicole

How the cities, how these megacities have been drivers of economic development.

Suki Basi

Drivers, yeah.

Nicole

Drivers, and how Governments are seeing that and trying to, maybe, use that model in creating these new science parks and other technological cities. I was wondering if you could comment on the possible future success of those cities?

Suki Basi

Possible?

Nicole

Future success of those cities in driving development and driving economic – driving the national economy away from just super-cities to more bespoke?

Suki Basi

Yeah, I mean, I think if you look at that JLL graphic, Washington is a city that’s actually contending, but actually, there are another three or four cities in the US that are actually trying to contend within that space, but I think if we come closer into the UK and maybe extend it to include Ireland. Dublin’s up there on the list as a developing city and one that’s actually, trying to actually compete more globally. But I think I’d like to cite Manchester – well, actually, if we looked at the GDP contribution of Manchester, Birmingham, Leeds and one other, Liverpool. Those four cities, if you combine their GDP contribution, it’s probably only half of London’s, but I think the policies of maybe moving the BBC up to Manchester and success of the power of the Premiership and the effect that has globally, has actually helped the city because, actually, directly correlated to the number of flights coming into Manchester.

Manchester is a very, very busy airport. So, I think that we are seeing the beginnings of that in the UK, but at the same time, we struggle to join the ends up. We don’t have the infrastructure that really works. We have a lot of vested interests, and – but I’m confident that if we use some of the opportunities that are presented, like the Brexit scenario, and I don’t mean to Brexit-out. I mean, the wake-up call that says, “We need to actually do something that actually, is much more inclusive.” That will actually help in promoting talent locally and rebalancing the economy, ‘cause, in the end, that’s what’s really needed otherwise we’re going to lurch from one boat to the next as people find other excuses as to why we shouldn’t be together.

Wow, this is really – I’m earning my crust here today, aren’t I?

Benjamin

My name’s Benjamin. I’m actually a student, studying international relations at Exeter.

Suki Basi

Good man.

Benjamin

So, I suppose – and sort of target of this, as I myself are looking for a job after university and it’s about opportunities about where am I going to go?

Suki Basi

Right, so you’re a student. Have you just graduated or graduating?

Benjamin

I’m graduating next year.

Suki Basi

Next year, right, okay. So, when you graduate, what do you want to become?

Benjamin

That’s a cool question. Obviously, there are different paths you can take, studying international relations, but the question is, where do I want to work? Where’s the opportunity? And that’s a very interesting debate. So, why would I choose Manchester over London, or vice versa and, yeah, there’s more opportunity in London, it’s true, but even if there was equal opportunity in Manchester, it’s more than that, I think. London’s a hub for recent graduates. There’s more than just opportunity. There’s culture, there’s all your friends who are going there as well. So, how can you make Manchester – how can it – how can you – I would like – how would you incentivise a student to want to go to Manchester to work there instead of London?

Suki Basi

Right, first off, I hear your pain. I’ll answer that and I’ll answer it very quickly ‘cause I’m mindful of the time as well, is that I was actually watching the England-Spain game last year and the reason why I say this is there’s a young chap that actually represented the FA. I was in the FA box. He used to work at Manchester United in the Marketing Department, had his own flat, in a very posh part of Manchester, but gave all that up because he wanted to move to London and he wanted to work at Wembley, and now he was sharing, you know, with three other people.

It’s a difficult one because everybody sees the lights and everybody wants to come to London, which is why 30% of all graduates are actually wanting to go to London. It’s a huge aggregator from that perspective, but if we look at the landscape around universities and science parks, things are beginning to change, and I think we’ve just got to give it that time. Create the opportunity, create incentives. Give people the financial incentive to want to go there, at whatever age. It doesn’t have to be a young person, an older person, because I think talent needs to be recycled. So, I don’t know whether that answers your question? But I’ve got a smile out of you, so I probably did.

Nicholas Khalib

Thanks. I’m Nicholas Khalib from Greenmantle. You’ve outlined some very convincing things that the public sector and the Government can do in figuring out the questions you’re asking. Especially with the way it’s easier nowadays to work from anywhere. Do you see a significant role for the private sector in this and if so, how?

Suki Basi

Private sector in?

Nicholas Khalib

In terms of dealing, basically, sort of reducing the influence of super-cities in the way that it’s a lot easier to now work remotely and work from anywhere. Do you think the private sector can play a significant role in this?

Suki Basi

Well, absolutely. If the private sector and Government works together it can change. People’s attitudes can change quite dramatically. So, I think that we need to actually move to that, but at the same time, we need to create an integrated society. Not at the expense of London. London is actually – it should be encouraged to grow, but we will get to a sticking point in London when we actually get a population of greater than ten million, you know, how difficult has it been for Heathrow to get its planning permission through? If the city keeps growing, we’ll need another one, so what then? So, we’ve got to be mindful of the impact of undue concentration and we can do that by actually investing and creating cultures that enable the bright lights to stand out in other parts of the UK.

Gid Vannervan

Hi, I’m Gid Vannervan with the Bloomberg Global Data.

Suki Basi

Bloomberg?

Gid Vannervan

Yes, and, first of all, thanks for the chat and answering all the questions coming your way. I was wondering, given the multiple aspects that we’ve discussed so far of megacities, is there any evidence that shows what the effect on the environment is of both the rise of these super-cities and the eventual decentralisation that might follow in the future?

Suki Basi

My concern, in answering that is, you may have children born in a megacity that have probably never touched a tree. They’ve just never lived in the woods and never experienced nature. So, it becomes something that we’re not real to. So, I mean, that’s the way I would want to answer that, but you can carry on the question, if you like.