Business Strategies

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Expand Heathrow and watch British business take off. Building a new runway at Heathrow is by no means the biggest construction project in the country. But it will go a very long way towards cementing Britain's business recovery. And here's why. The world's fastest- growing markets are in Asia and South America. By 2050, nearly half of global GDP will be generated in these emerging markets. Research has shown that direct flights to long-haul destinations build twenty times more trade with them. But, for that to happen, you need a hub airport: with the critical mass of passengers, high-value cargo and connections to make direct long-haul flights to all these markets viable. As a recent CBI report points out: "hub airports serve on average nearly three times as many destinations as point-to-point airports." Britain has one hub airport: Heathrow. Right now, 4 in every 5 long-haul flights from Britain fly from Heathrow, via 82 airlines, carrying 73 million passengers a year. Heathrow also carries £182 billion of exports and imports each year: including 26% of all UK exports, and two thirds of all air freight. That's why 120 global companies have their European headquarters in the M4 corridor (and why this area has the highest full employment rate in the UK). As Britain's hub airport, Heathrow is a magnet for global business; and a powerful engine of the British economy. The problem is, if we don't expand it, we can't give British businesses the chance to take advantage of all these opportunities in new destinations. The CBI describes the UK's lack of hub capacity as a "ticking time bomb". And, if we don't do something about it, our competitors happily will. France, Germany and The Netherlands have hub airports too. They also have the ambition (and political backing) to expand them. And they would love to take the growth that could – and should – be Britain's. As the Airports Commission recently confirmed, a new runway at Heathrow will bring as much as £211 billion of economic benefits to the UK (not to mention up to 180,000 new jobs). Every month we don't do it costs the British economy £1.25 billion in lost trade. That's why we think it's time to stop talking. And get down to business. Sources: Goldman Sachs Global Investment Research, 2012; Frontier Economics, "Connecting for Growth", 2011; CBI, "Boosting capacity where it matters most – the nub is the hub", September 2014; Official Airline Guide; HMRC; Civil Aviation Authority; Freight Transport Association; Companies House; ONS Annual Population Survey; Airports Commission, "Heathrow Airport Extended Northern Runway: Business Case and Sustainability Assessment", November 2014; Frontier Economics, "Missing trade opportunities: The impact of Heathrow's capacity constraint on the UK economy", November 2012. heathrow.com/takingbritainfurther #TakingBritainFurther

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