Downing Street’s bungling of port giant’s investment signals choppy seas ahead | Business News
P&O Ferries is one of the few subjects on which Britain’s political class agree. Its summary sacking of 800 British seafarers and their replacement with cheaper, largely foreign agency staff is universally considered one of the most outrageous acts in the recent history of labour relations.
Louise Haigh was among the first and loudest to call it out, attending protests in Dover as shadow transport secretary the day it happened in March 2022. As a minister, however, the stakes are higher.
By describing P&O as “rogue operator” at the same time as her colleagues were trying to persuade its parent company to shell out £1bn, she has received a sharp lesson in the trade-offs required in office.
DP World has been smarting at the public response to P&O’s actions for more than two years, but it has never apologised, arguing it was justified by the survival of the company.
Reputations recover, bankrupt companies do not, appears to have been the view from Dubai.
So it should not have been a surprise that DP World’s leadership and its chairman, Sultan Ahmed bin Sulayem, took offence when P&O’s sins were deliberately and publicly dredged up a matter of days before he was due to endorse the government at its Investment Summit.
With control of a company that generated almost £14bn in revenues and operates in more than 60 countries, he has a choice about where and when to activate capital.
He will not now travel to London, the expansion of London Gateway is on hold, and the Investment Summit has suffered an embarrassing blow.
The vibes around the event were already less than perfect, with some investors reportedly yet to commit and critical arrangements amid general concern that Labour is courting overseas wealth while simultaneously plotting to tax it in the budget.
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There is always a cosmetic element to these events. Multibillion-pound investments take months not days to agree, but royal receptions and prime ministerial handshakes help, and politically and practically, Sir Keir Starmer needs this one to be a success.
His government has an ambitious plan to deliver growth through investment in infrastructure and technology on a scale that is beyond the means of the UK capital markets. We are reliant on the kindness of strangers, as the saying goes, and that sometimes requires compromise.
To pick one at random, the head of Saudi Arabia’s Public Investment Fund is scheduled to attend on Monday, a year after he gave a keynote session at a similar event hosted by Rishi Sunak, with barely a peep of comment.
The summit occurs on the 101st day of the Starmer government, and Downing Street sees it as an opportunity to reset and move on from weeks of squabbling over advisers and freebies.
The bungling of DP World’s investment signals more choppy seas.