PROFESSOR DYLAN JONES-EVANS

Looking back over the period since the pandemic began, possibly one of the most iconic memories for me was clear blue skies with no aircraft trails to be seen anywhere.  In fact, it got to the stage, with aeroplanes grounded across the World, that seeing a long white line moving across the sky – usually a cargo plane – became a rare phenomenon rather than an everyday occurrence. The fact that people were not travelling abroad and staying at home within their own countries meant that the environment improved across the World. There were news reports about smog disappearing in some the World’s most polluted cities and fish returning to rivers and waterways such as the canals of Venice. Given this, there was hope that the world may have turned an unexpected corner on climate change with one academic journal suggesting that global carbon dioxide emissions had fallen by 17% in April 2020 as compared to the previous year. Unfortunately, as economic activity has started again, that drop h...

Earlier this week, there was some excellent news for the creative industries sector in South East Wales when the UK Government announced that media.cymru project was to be granted £22.2 million under its Strength in Places Fund.  This will bring together key stakeholders in the industry, including UK broadcasters, universities, small local businesses and freelancers in a £50m initiative to research and develop new products and services for global markets. The Strength in Places Fund - which has been established to support economic development across the UK – is an excellent policy tool in that it funds the specific competitive strengths of different parts of the UK. It forms an important part of the UK Government’s new innovation strategy to boost private sector investment in R&D across the whole of the UK and create the right conditions for all businesses to innovate. It is an ambitious approach that aims to increase annual government investment on R&D to £22 billion, help...

Over the next few weeks as we approach the Senedd elections in May, many organisations will be putting forward ideas on how the next Welsh Government can make a difference to the nation. Given the importance of new and smaller businesses to the Welsh economy as we emerge out of the pandemic, our next group of politicians should read the recent proposals from Purple Shoots, a not-for-profit micro finance organisation that provides small business loans at fair rates. With an impressive track record over the last seven years, they have helped to fill a real gap in access to finance to the newest and smallest firms and, in doing so, have made a real difference to the ambitions of those from the poorest communities who want to start their own businesses. One of their suggestions is to divert one per cent of the £270m recently given to the Development Bank of Wales by the Welsh Government towards funding new microbusinesses employing less than ten people. Using their own success as an exampl...

Earlier this week, in association with Wales Week London , we launched the sixth Wales Start-Up Awards which celebrates the success of the best new Welsh businesses every year. It was a pleasure to interview a number of the award winners that are making a real stamp on their industries and markets.  These included Project Blu , overall winner in 2020 which has signed a major multi-million pound deal to sell their environmentally friendly dog products in the USA; Yoello , the Cardiff-based payments specialist which had to pivot during the pandemic but has completed a major funding round to expand their operations substantially; t he Goodwash Company , whose innovative approach to their business is putting them on the path to becoming a major UK brand in the next couple of years; and the Enbarr Foundation which is rewriting the textbook on community entrepreneurship through its efforts in Deeside. Despite all the challenges of the last 12 months, these amazing founders had not only s...

Earlier this week, the Welsh Government published its Economic Resilience and Reconstruction Mission which sets out how it will work to rebuild Wales’ post COVID-19 economy. Like every economic strategy document, there are elements of good and bad policymaking within the document. For example, some of the actions on developing a greener economy, supporting innovation, improving digital skills, better public procurement and moves to support our high streets are to be welcomed.  But there are also considerable omissions on key issues which are critical to development of any economy, never mind that of Wales which is the poorest in the UK. For example, there is a total lack of focus on supporting entrepreneurship and new businesses. This is despite overwhelming evidence that new firms not only create the majority of new jobs in any economy but especially during a recession where large firms continue to shed hundreds of thousands of jobs.  And it’s not as if the Welsh Government h...

When I conducted the Access to Finance review for the Welsh Government seven years ago, it was the affordability of the repayment of a loan, rather than the cost of borrowing, that was cited in interviews with banks, intermediaries and small businesses as being the main obstacles to accessing bank finance.  From discussions with the banks at the time, it was clear that more stringent rules regarding credit availability has reduced the terms of loans and the affordability to many businesses.  This was also the conclusion of a major review of the Royal Bank of Scotland’s lending to small firms which found that whilst the average contractual term for commercial banking loans was approximately nine years for accounts opened in 2008, this had been shortened to approximately five years in 2009 and had largely continued at that level since for most accounts. Given this, one of the recommendations that we made for the creation of a new Development Bank of Wales following the review wa...

Three years ago, this column wrote a piece about the challenges that were facing the Swansea Bay City Deal when it largely abandoned the digital future envisioned by Sir Terry Matthews, one of Wales’ most successful entrepreneurs, to adopt a strategy focused very much on buildings such as the Wellness Centre in Llanelli.  Having had previous experience of this approach and written various critiques of the failed Technium initiative which was also a ‘if you build they will come” approach, I did not make the comments lightly. The subsequent issues that have arisen over the future of the Wellness Village, including an ongoing police investigation, were not surprising and, as I predicted, have had an effect on the viability of other worthwhile projects. Of course, speaking such truth to power has its dangers to any commentator in academia, public life or the media and I certainly received my share of personal abuse and professional criticism from supporters of this approach during that...

Back in 2013, I began a two-year assignment for the Welsh Government to examine the key challenges for Welsh SMEs in accessing finance, an exercise which eventually led to the creation of a new Development Bank of Wales. Since the task and finish group made its recommendations back in 2015, the environment for business has changed considerably and there has been a growing appreciation of the role that SMEs can play in growing the economy.  Understanding the environment in which SMEs operate, especially in terms of accessing finance, remains important to policymakers and that is why the recent publication of the Small Business Finance Markets report from the British Business Bank makes for some fascinating reading.  First of all, it is clear that there is an increasing flow of finance from providers to SMEs, not only in traditional debt lending but also in other forms of funding such as equity or asset finance.  But whilst there is more money available in the system, it wo...

For many new companies, access to capital is one of the critical factors that can mean the difference between success and failure as the business grows. Asa result, investment by individuals (commonly known as business angels) in exchange for equity in the business has become one of the key sources of funding in many innovative firms. In fact, it is estimated that business angels collectively invest an estimated £1.5 billion per annum and are the UK’s largest source of investment for start-ups and early-stage businesses seeking to grow. To encourage greater levels of investment by such individuals, the UK Government has created two incentives for investors. The first - the Enterprise Investment Scheme (EIS) - offers tax relief on new shares in small companies and individuals can invest up to £1,000,000 in any tax year and receive 30 per cent tax relief. The second – the Seed Enterprise Investment Scheme (SEIS) - was introduced in April 2012 to encourage investment in early s...

Four years ago, I published a report on access to finance for SMEs, commissioned for the Welsh Government, which recommended that Finance Wales should be incorporated into a new one-stop-shop operation called “the Development Bank of Wales”. The report had concluded that Finance Wales was not fit for purpose because there was confusion over its actual remit i.e. was it aiming to be the best investment fund in the UK as its vision stated or should it be focusing on its economic development role? The Minister for the Economy backed the latter view and in 2014, I was asked to chair a task and finish group to examine how this Development Bank could be established to better support Welsh businesses. After considerable work by a group of fantastic individuals, the final recommendations were accepted by the Minister in 2015 and a member of that group was tasked with developing a business case to examine whether Finance Wales could take these on board and evolve into a new Developmen...