The Greater London Authority stated that London's offices in the key emerging markets of India and China will stay open despite Boris Johnson's earlier pledge to close them. The present blog has commented on this enforced U-turn, including references to Boris Johnson's and the Tories demagogic and damaging campaigns to close these offices during the Mayoral election. Boris Watch has now carried an excellent summary of additional parts of this Evening Standard and Tory campaign which can be read here.
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January 2009
January 20, 2009
January 18, 2009
Johnson administration abandons Russian Winter Festival
The first of the major international outdoor cultural events to be abandoned by Boris Johnson is the Russian Winter Festival - which should have taken place this weekend. This open air celebration, staged at the time of the New Year according to the old Russian Orthodox Calendar, that is in mid-January, had become a major annual London event.
The Russian Winter Festival was highly recommended by the national press, frequently on 'choice of the weekend' lists, was of high artistic quality, and attended every year in Trafalgar Square by well over 50,000 people.
But, in addition to being a good time for Londoners and their families, it also had a very serious economic purpose by being the major annual event in London's promotional drive in Russia – a market becoming of great importance to London's economy and therefore for Londoners incomes and jobs.
Russia became the single most important foreign section for foreign listings on the London Stock Exchange. In 2007 CIS (former USSR) companies raised over $19 billion in Initial Public Offerings (IPOs) on the London Stock Exchange. Trading volumes in 2008 for CIS companies were $477 billion. London had completely out competed New York in this market, with New York not floating a single major Russian company in recent years.
Russian tourists have become one of the most rapidly growing source of customers for London's West End – with annual rates of growth of increase in spending, which can be calculated from VAT refund returns, of over 40 per cent.
Russia's three votes on the International Olympic Committee were decisive in winning London the Olympic Games against Paris.
The positive consequences of this for London's financial, business services, tourist, and retail sectors is evident - all of which translates into incomes and jobs for Londoners.
The Russian Winter Festival generated large scale TV coverage in Russia – over 30 pieces of Russian TV coverage in 2007 alone for example. A few pieces of the coverage are put as videos at the end of this post. The equivalent advertising value to London in Russia of the TV coverage was several million pounds.
Given that no other city staged such a prestigious event it helped make London a welcoming natural home for Russian business people and tourists whose combined spending is worth hundreds of millions of pounds a year to London and is growing in importance. Whatever the ups and downs of political relations with the Russian government Londoners jobs depend increasingly on such international markets.
The Russian Winter Festival, in short, was an extremely smart piece of marketing - generating the equivalent of huge advertising for London in a key market and simultaneously giving Londoners a good time. Given the international financial crisis, and the fall in the exchange rate of the pound which makes London a still better value destination, London should be stepping up, not cutting, its international marketing efforts.
It is, therefore, typical of the Johnson administration's inability to judge the value of money for most things that it has abandoned the Russian Winter Festival.
Given Russia's importance in its three votes securing London the Olympic Games this will be dealt with separately – again because it shows how the international promotion of London under Ken Livingstone's administration secured huge economic benefits for London and why the present administration is incapable of winning any comparable major prize for London precisely due to both its economic incompetence, its complete failure to understand the nature of the modern international economy, and a consequent inability to understand what constitutes serious value for money.
Video - Coverage of the launch event of the Russian Winter Festival January 2008
Video - Russian coverage of the Russian Winter Festival in Trafalgar Square January 2008
Photo - Launch of the Russian Winter Festival 2007
Video - TV coverage of the Russian Winter Festival 2006
Video - An Example of Russian TV Coverage of the 2006 Russian Winter Festival
Other blogs by John Ross
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- Johnson administration abandons Russian Winter Festival
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The review of the offices now finds the resons for opening them are 'fundamentally sound' and that 'the GLAs offices do play an important role in promoting Londons interests, from supporting the capitals businesses and to enhancing the image of our city around the world.'
I deat with this on my blog on London last November as follows and the comment remains entirely valid:
'Few things illustrate Boris Johnson's administration's failure to understand the modern world, and therefore its incompetence, more completely than the saga of London's offices set up to represent and promote the city in India and China - the world's most rapidly growing giant new economies. It is an issue thrown into particularly graphic light by the current world financial crisis.
'During the Mayoral election campaign Boris Johnson, and Tory candidates, did everything possible to present it is as ridiculous for London to maintain offices to promote the cty abroad - Think London, the city's inward investment agency, which is funded by the London Development Agency, also has offices in the US.
'Boris Johnson and Tory candidates frequently attempted to exploit the most backward looking sentiments regarding these - often making attacks on them the first point in their campaign literature.
'Thus for example Richard Tracey, Tory candidate for Merton and Wandsworth, announced in his election leaflet to electors: 'Local Conservatives are campaigning to remove the extravagances such as Ken Livingstone's "foreign embassies". Matthew Laban, Tory candidate in Enfield and Haringey, in his address to constituents, attacked that ‘our money has been spent opening embassies in other countries.
'Boris Johnson himself took the same position. Taking the Nick Ferarri show on Wednesday 12th December 2007, Ferarri asked: ‘And would you continue bureaus in Venezuela, Delhi, Beijing and everywhere else? Yes or no. Boris Johnson: "No."
'This pledge was strongly attacked by leaders of Londons businesses, who understood the importance of these decisive new markets overseas - for example at the Mayoral London business hustings on 26 March.
'Boris Johnson, worrying about such business criticism, therefore scrapped his previous pledge to close the offices and announced to the Evening Standard the same day that he would ‘review them. Then on 14 April he announced in his business manifesto today that ‘we fully endorse the representation of London overseas (p13). In other words a complete U-turn.
'That, however, as has already point out above, did not stop Tory candidates across London campaigning against Londons representative offices. There was, in short, a complete shambles.
'And what is revealed by the present international financial crisis, of course? That the two economies in the world which will be most relatively strengthened by it, because they are continuing to grow most rapidly through the crisis, are China and India - the places where Boris Johnson pledged to close down London's representation. A truly brilliant move that would have been. And of course his administration would never have opened them in the first place.
'It is said that the difference between a statesman and a politician is that a statesman leads the country and a politician follows it. Ken Livingstone will be remembered as a great Mayor of London because he led the city to face key challenges that confronted it at the beginning of the 21st century - just as, in a different way, he redefined politics in London by facing the different challenges it confronted twenty years previously when he was leader of the GLC. Boris Johnson's administration, as shown vividly by its opposition to London's offices abroad, and its use of the most ignorant sentiments to attack them, has no understanding of the the most important challenges that face London at the beginning of the 21st century.'
Reality has hit Johnson's administration over the head and forced it not to close the offices - except they would never have set them up in the first place, leaving London unrepresented in the world's most rapidly growing large markets.'
To make explicit my interest, as Director of Economic and Business Policy under Ken Livingstone I was responsible for the policy of openng London's offices abroad.