Economic growth cannot be delivered by any one institution acting alone
New Welsh Secretary Stephen Kinnock.(Image: Wiktor Szymanowicz/Future Publishing via Getty Images)
The Senedd election is now behind us, the UK has a new Prime Minister, and a fresh chapter in Welsh public policy is beginning.
With new administrations taking shape and priorities being set, there is a renewed opportunity to focus on what matters most: delivering sustainable economic growth for Wales.
I would like to welcome the appointments of Andy Burnham as Prime Minister and Stephen Kinnock as Secretary of State for Wales.
Their success will matter enormously to businesses, communities and families across our nation. While politics will always involve differing viewpoints, economic prosperity is best achieved when governments, businesses and civic institutions work constructively together towards shared objectives.
Our chief executive, Alan Vallance, has already congratulated the Prime Minister on his appointment and set out ICAEW’s commitment to working constructively with the new government.
That spirit of partnership is one that we strongly support here in Wales. ICAEW stands ready to work with ministers at both Westminster and in the Senedd to help shape policies that support enterprise, improve productivity and drive sustainable economic growth.
At ICAEW, our members operate in every sector of the Welsh economy. They advise businesses large and small, support investment decisions, help organisations navigate periods of uncertainty and play a critical role in driving productivity and growth. From that vantage point, one message is consistently clear: collaboration delivers better outcomes than confrontation.
That lesson feels particularly relevant today. The latest ICAEW business confidence monitor published last week shows that business confidence in Wales has fallen sharply, reflecting wider challenges facing firms across the UK.
Confidence declined in ten of the eleven nations and regions surveyed, with geopolitical instability, rising costs and continued uncertainty weighing heavily on business sentiment. In Wales, labour costs remain a significant concern for many employers, although encouragingly businesses expect domestic sales growth to strengthen over the coming year.
Those findings tell an important story. Welsh businesses are realistic about the headwinds they face, but they have not lost their underlying optimism. They continue to invest, innovate and look for opportunities to grow.
The role of government must be to create the conditions that allow that confidence to be translated into higher investment, greater productivity and more well-paid jobs.
That is why constructive engagement between Westminster, the Senedd and the business community is so important.
Economic growth cannot be delivered by any one institution acting alone. It requires a shared commitment to improving competitiveness, encouraging entrepreneurship, supporting skills and creating an environment where businesses can thrive.
In that regard, I have been encouraged by the way Plaid Cymru has approached government in its opening months. The party has hit the ground running and made visible progress against its 100-day plan. Regardless of political affiliation, businesses value momentum, clarity and a willingness to engage. Those early signals matter because they help create confidence that government is focused on delivery.
I would therefore urge the new UK Government to work constructively with Plaid Cymru in Wales wherever common ground can be found. The Welsh economy will benefit most when political leaders focus on practical solutions rather than institutional disagreements.
Businesses are less concerned about which level of government receives the credit and more concerned that decisions are made, barriers are removed and investment opportunities are unlocked.
One particularly welcome development has been the positive discussion around a new development agency for Wales. If implemented effectively, such an organisation has the potential to become a powerful catalyst for investment, regeneration and business growth across the country.
Wales has enormous strengths: a highly skilled workforce, world-class universities, growing innovation clusters and a strong entrepreneurial culture. The challenge has often been ensuring those strengths are connected to the right support and sources of capital.
This is where collaboration will be critical. Working in partnership with the Development Bank of Wales, a new development agency could help create a clearer and more coordinated support ecosystem for businesses.
Whether supporting Welsh firms looking to scale, attracting inward investment, or helping companies relocate and establish operations in Wales, the focus must be on ensuring businesses can access the advice, finance and networks they need to succeed.
Productivity must also remain at the centre of the conversation. Raising productivity is not simply an economic statistic; it is fundamental to improving living standards, increasing wages and strengthening public services.
Too often, debates about growth focus solely on headline investment figures. Important though those are, long-term prosperity depends on helping businesses become more productive through innovation, digital adoption, skills development and better access to capital.
Chartered accountants have an important role to play here. ICAEW members work directly with businesses to improve performance, support investment decisions and identify opportunities for growth. They understand both the challenges facing employers and the practical measures that can help overcome them.
That is why I have been pleased to begin engaging with Adam Price as our Cabinet Secretary for Enterprise, Connectivity and Energy and other stakeholders as discussions around Wales’ economic future develop.
ICAEW is committed to bringing evidence, expertise and practical insight to these conversations. Our objective is not to advocate for a particular political perspective, but to ensure that the voices of our members and the businesses they support are heard.
The latest business confidence nonitor reminds us that challenges remain. Confidence has weakened, costs continue to rise and global uncertainty has not disappeared. Yet the survey also highlights resilience and a continued belief among Welsh businesses that growth opportunities exist, particularly through stronger domestic sales. The task now is to turn that potential into reality.
For Wales to succeed, government and business must work hand in hand. Westminster and Cardiff Bay must collaborate where possible. Investment agencies, financial institutions and the private sector must align around shared objectives. And policymakers must remain focused on the practical steps that improve productivity, encourage enterprise and create the conditions for sustainable growth.
If we can achieve that, Wales will be well placed not only to weather current economic challenges but to build a stronger, more competitive and more prosperous future. As ever, ICAEW Wales stands ready to play its part in helping shape that discussion and supporting the decisions that will drive growth across our nation.
- Robert Lloyd Griffiths is Wales director for the ICAEW.
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