‘Driven to brink of bankruptcy’
CITY investors have begun moving hundreds of millions of pounds out of the UK because of fears Jeremy Corbyn would turn the country into ‘Cuba without the sunshine’ if he became prime minister.
Rather than worrying about Brexit, money managers are nervous that the Labour leader could sweep to power and implement a raft of hard-Left policies that devastate the economy.
The Labour manifesto before the election in June promised £48bn a year of extra public spending, funded by increased corporation tax and higher income tax on top earners, as well as the nationalisation of key industries.
Critics compared the plan to the economic policies of Cuba, which has been run by the hard-line Communist party for the past 50 years.
Edi Truell, a private equity chief who has already shifted his entire £250million fortune to Switzerland, said investors were pulling finance out because of the fear of Mr Corbyn, not Brexit. He warned he had been advised it would be ‘bonkers’ to keep the fund in London ‘when there is a possibility of having a highly damaging government in power’.
He said: ‘The threat of nationalisation is the sort of thing that makes investors run a mile. Brexit is an issue businesses can cope with, but you cannot cope with the confiscation of assets.
‘ On Brexit, ultimately we know what the direction of travel is going to be. It’s fine, we can cope with that and plan for that. What is not fine is threats to nationalise the commanding heights of the economy.’
Mr Truell’s firm had been planning to build a factory in the North East to produce high- voltage cable to bring in cheap renewable energy from Iceland. But he said: ‘If you threaten to nationalise it, I’m going to find it difficult to persuade investors to put up the money. If you are an international investor and you see nationalisation, you think, “b****r that” and invest somewhere else.’
Mr Truell said he was not ‘uncritical’ of the current government, but argued that Labour’s manifesto would take the country back to the financial crisis of the 1970s.
‘If Labour was to implement what it says it is going to do, it would be most unhelpful,’ he said.
‘Given that Britain was driven to the brink of bankruptcy, to try to repeat the same policies that drove us into that dreadful position seems to fly in the face of history.’
A banker at Goldman Sachs said the UK would be like ‘Cuba without the sunshine’ if Mr Corbyn managed to get into Downing Street.
At a private equity conference in Amsterdam, investment banker Bobby Vedral described such a scenario as a ‘disaster’. He added: ‘There is a clear risk in the next six months of Corbyn. Now that is a problem.’
Mr Corbyn then declared war on Britain’s valuable banking sector. He said: When they say we’re a threat, they’re right. We’re a threat to a damaging and failed system that’s rigged for the few.’
IN what looks like an attempt to put satirists out of business, shadow chancellor John McDonnell seeks to ‘clarify’ Labour’s contorted position over Brexit. The party has no wish to keep Britain in
the single market and customs union, he says, arguing that this would disrespect the referendum result.
No, instead Labour want to keep us in a single market and customs union! How’s that for sheer, semantic nonsense?
Meanwhile, Jeremy Corbyn suggests we should postpone withdrawal for a ‘little bit longer’ – thus raising the prospect of indefinite uncertainty for businesses.
Before the referendum, Remainers in the City raised apocalyptic scares (which show no sign of materialising) over Brexit.
Now at last they are waking up to the truth that Messrs Corbyn and McDonnell represent a far more potent threat to trade, jobs and prosperity than the worst that could come of Brexit.
With the hard-Left at the helm, says a partner in Goldman Sachs, the UK would be like ‘Cuba without the sunshine’.
In backing Brexit, voters took a calculated risk, reckoning the opportunities outweighed any drawbacks. This paper firmly believes they were right.
But can anyone seriously think putting economically illiterate Marxists in charge of our destiny is a risk worth taking?