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Statement by the President of the Committee for Economic Development

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Wednesday 04 September 2019

Sir, I will provide an update to Members on some of the key areas of the Economic Development Strategy where significant progress has been made.

Transport connectivity remains one of the Committee's critical priorities.

Since the introduction of open skies in September of last year we have seen the launch of seven new air routes, including Heathrow, Southend, Liverpool, Newquay, Edinburgh, Bournemouth and Groningen. During the first few months of operation in 2019, overall airport traffic has seen a number of record months, with total passenger movements up by over 29,750 passengers by 31st August 2019 - that is an increase of 5.5% year to date after many, many years of decline.

The London market, in particular, has shown strong passenger growth of almost 5%, following the launch of the new routes to Heathrow and Southend, in addition to the existing routes to Gatwick and Stansted.

I am very pleased to announce that the Heathrow service has already seen nearly 13,000 passengers fly the route to the end of July, and the Committee has recently agreed, as you will have read, to extend the Heathrow service into the winter season.

The new Charter from Groningen Holland this year has been a resounding success bringing almost 600 additional high-spending Dutch visitors. Following this success, SunAir has announced that it will be doubling the capacity of its charter for the 2020 season.

The Committee has also recently announced a new Island Hopping charter package bringing 30 flights in from 16 different German cities with German tour operator, Globalis, for 2020.

We are also working on other potential new direct scheduled air routes from the UK and from France. The Committee hopes to make further announcements in the coming weeks and months.

Members will be aware that the Committee recently retendered the Public Service Obligation for the Guernsey to Alderney air route following the approval of the Open Skies policy. I am pleased to report that the response to this has been positive and officers are currently evaluating submissions with the intention of bringing forward proposals to the Assembly at the earliest opportunity.

The Assembly will be aware that Macquarie Infrastructure and Real Assets is currently in the process of selling Condor Ferries. We understand that there are a number of interested parties and the Committee will be seeking to engage with potential buyers at the appropriate time in the sales process.

In the meantime, the Committee continues its dialogue with Condor and with the States of Jersey to agree the service level improvements and asset plans necessary for both governments to consider an extension to the current 2014 Condor Operating Agreement, and for Guernsey to become signatories to that agreement.

The Committee is engaging with industry representatives to agree a ten-point Strategic Plan for Guernsey's tourism and hospitality sector. This Strategic Plan will be agreed following the review of the 10-year Guernsey Tourism Strategy that was published in 2015.

We have seen some positive developments in the tourism sector with an 8% increase in Total Visitor numbers for the first half of 2019, compared to the same period last year. The increase has been largely driven by a strong cruise ship season supported by increased staying visitors from France, Germany, North America and Australia. This has been helped by the additional marketing around the Guernsey Literary and Potato Peel Pie Society movie and the focus on the French market following the reopening of Hauteville House.

We expect that, after over 20 years of decline, staying visitor numbers will continue the more recent steady growth. The announcement by Premier Inn of its intention to build a new hotel in St Peter Port, and the recent interest from Travelodge, as well as from other potential hotel operators, are welcome signs of the growing confidence in Guernsey.

Locate Guernsey has been working hard to attract high net worth individuals to relocate to the Island and in 2018 it directly saw 24 relocations and 49 jobs created witha total financial benefit of at least £1.15 million.

In the year to date there has already been more new enquiries than during the whole of 2018 and there have already been 24 actual relocations by mid-August; as many as during the whole of 2018. This demonstrates the growing interest and confidence in Guernsey, as well as the growing presence and performance of the Locate Guernsey brand.

While Deputy St Pier has already provided the Assembly with an update on Brexit, it is worth highlighting that the Committee continues to work closely with local business to support them to prepare for this.

We continue to engage throughout Whitehall and I have met with James Duddridge MP, the Parliamentary Under-Secretary at the Department for Exiting the EU. The Minister's enthusiasm for the potential opportunities Brexit may bring to Guernsey was encouraging and it is a timely reminder that the UK's exit from the EU, if it happens, couldprovide opportunities for businesses based in the Bailiwick.

The Committee will, in conjunction with a working party led by industry, soon release a progress update report on its Red Tape Audit, which is looking into a number of areas; including the ease of setting up a business, access to labour and planning applications.

The finance sector is the engine of our economy, with good work being done by industry, Guernsey Finance, the GFSC and government - in partnership - to develop our offering, in order to maintain and grow the sector.

One example is the creation of Guernsey Green Finance, a green promotional body established in late 2018. This group, along with other stakeholders, has assisted in delivering the Committee's strategic commitment to build and develop markets where Guernsey has a real competitive advantage.

The Committee has already made good progress in implementing legislation in respect of Smart contracts and is driving amendments to the Companies Law to ensure that it continues to best serve the needs of local businesses.

The Committee also intends to bring proposals to the Assembly to provide better consumer financial protection in relation to non-bank provision of credit, to provide a framework for dealing with a local bank failure and to increase depositor protection.

The Economic Development Strategy prioritises digital connectivity and the acceleration of next generation digital infrastructure in Guernsey.

In May 2018 the Committee for Economic Development set out its telecoms strategy objectives which include the provision of high speed residential broadband; the process for the roll-out over time of an island-wide 5G network, including setting out licence conditions and criteria; and the provision of fibre to businesses.

In April 2019 the Committee requested that CICRA launch a draft 'statement of intent' consultation process with telecoms companies and other interested parties to understand their views on the spectrum requirements and the proposed licencing process required to help meet those objectives, especially in relation to the rollout of 5G technology. This consultation took place during May and June 2019.

The Committee has now had the opportunity to consider the feedback from that consultation and will be providing an update to States members on next steps within the next few weeks.

As you know Sir, the Future Digital Services programme includes an economic development element. The Committee intends to use this opportunity to further develop the digital and entrepreneurial environment on Guernsey. We will work in partnership with Agilisys to provide a 10 year plan for business mentoring and investment and digital skills and apprenticeship initiatives designed to foster economic growth. Plans to further develop our approach to MedTech are being co-constructed with the Committee for Health and Social Care.

The work on digital skills, through the Skills Action Plan, continues at pace with the Digital Greenhouse delivering over 70 events focused on digitisation of business and entrepreneurial activity in the past 12 months.

Working alongside Agilisys and their founding partners Blenheim Chalcot, the next stage of growth for Guernsey's innovation hub will be to connect into Imperial College's soon to be opened business technology centre called 'Scale-Space'. This will provide Guernsey with an economic development presence in London and connection into an ecosystem which brings together leading research, business-building activities and talent.

The Committee continues to look at ways of diversifying the economy, including the development of plans for an international university presence in Guernsey.

The University Working Party held a workshop in May to further explore the International University concept with prospective partner universities. The workshop was a great success and we welcomed overseas representatives from universities from Australia, Slovenia, Canada and the UK, as well as other local stakeholders.

The workshop helped in the shaping of the model and curriculum of the University and proved to the Working Party that there is sufficient interest from overseas universities to working in partnership with Guernsey on this exciting project.

The Committee, through the Working Party, will now be considering the feasibility of the International University in more detail and, based on the outcome of this work, the Committee hopes to bring proposals back to the States before the end of this political term.

As you will appreciate, there are many other work streams being undertaken by the Committee, but I trust this has been a valuable update for Members of its main areas of focus.





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