Almost a year after UK Chancellor George Osborne warned that Britain must be prepared to take an economic hit under a tougher sanctions regime against Moscow, the CBI says the country is set to lose more for not engaging more fully with Brazil, Russia, India and China.
Speaking at Runways UK and backing a third runway for the UK’s main airport, Heathrow in London, Katja Hall, CBI Deputy Director-General said: "Delaying the decision to build a new runway will have a very real economic cost for our country. The Commission has been clear in its recommendation to the Government, and so are we – get on with building it without delay.
"A new runway will help re-balance our economy, prevent us handing opportunity to our rivals and avoid a future bill for our inaction," she said.
Over the time it takes to build a new runway, the United Kingdom could lose up to $48 billion in trade by 2030 because of the failure to increase flights to the Brazil, Russia, India and China, according to CBI research.
UK has been relegated to 4th or 5th position for new routes to China, Brazil and Russia from EU in the last 20 years pic.twitter.com/Ni5f18cYDU— Katja Hall (@CBIKatja) July 6, 2015
If there are delays to getting new runway capacity up and running beyond 2030, the annual cost to the UK economy in lost trade with Brazil, Russia, India and China alone — on top of $48 billion — could be up to an additional $8.2 billion, which will rise each subsequent year.
Diggers in the Ground by 2020
Welcoming the Prime Minister’s pledge to make a decision on the Airports Commission’s recommendations before the end of the year, the CBI said it wanted to see diggers in the ground swiftly by 2020.
"When it comes to airport capacity – time is money. We’re not just missing out on global opportunities, but paying an economic price right here in the UK," said Hall.
"Our failure to increase flights to BRIC countries alone will cost the UK as much as £31 billion in lost trade in the period it takes to build a new runway. That’s just from a lack of flights to the BRIC countries – just the tip of the iceberg. In fact, in 15 years, if we still don’t have capacity up and running, the cost of lost trade to the BRICs will reach up to an additional £5.3 billion a year. If we get to this point, we could be paying in excess of £600,000 an hour in lost trade."