Sub-sectors and SMEs are the power driving Cornwall’s economy

Cornwall, UK, sits in the most western and most southern tip of the UK. It has been celebrated for its mining, coastal beauty and food production for centuries, but there is so much more powering Cornwall’s economy today. Jo Murray speaks to Nicola Lloyd, Head of Inward Investment at Invest in Cornwall.

Everything Nicola Lloyd references is forward-looking and innovative. There is no evidence of nostalgia or re-visiting Cornwall’s past accolades; she focuses solely on an audit of Cornwall’s assets, how to attach innovative technologies to them and then put them to work for the future economic health of the county.

Perhaps the most obvious of those assets is Aerohub at Cornwall Airport Newquay. This is the UK’s only dedicated Aerospace Enterprise Zone and plays host to MRO companies, flight training operators, UAV operators and operates as a commercial regional airport with one of the longest runways in the UK. It is also far enough from London to boast uncongested and unrestricted airspace.

The county of Cornwall is located in the South West aerospace cluster whose big aerospace brands employ more than 23,000 people with specialisms across the aircraft design, manufacture, maintenance and operation spectrum. But Cornwall is about much more than just the aviation element of the aerospace industry; it has embraced space technology too – quite a coup for any location. For decades, Cornwall has embraced the technologies that enable satellite communications and space missions. Goonhilly Earth Station Ltd (GES Ltd) provides global satellite operators with a range of communications services and, like Aerohub, is a government designated Enterprise Zone geared up to attract the best and brightest contenders in the burgeoning space industry.

We are not just talking about satellites either; the spacetech industry in Cornwall also revolves around propulsion, its entire supply chain and, of course, technical training. The University of Exeter and the South West Centre of Excellence for Satellite Applications (SWCoESA) underpins the work of the cluster, and Cornwall Airport Newquay is among the preferred sites to be a UK Spaceport by 2020. There are not many regions globally that can talk in such grand and progressive terms.

But Cornwall is not trying to be all things to everyone in the space/aerospace sector – or in any other sector; Cornwall is all about nurturing sub-sectors within traditional sectors. “We do not take too wide an approach,” says Nicola. “And within all the sub-sectors we work with we target specific business types.”

In general terms, Cornwall’s pitch relates to tech-enablement, digitisation and connectivity. Within the UK, Cornwall is at the far end of the country, away from the London metropolis; but this observation fades into insignificance given high connectivity speeds and Cornwall’s successful relationships being built beyond the UK.

To illustrate the point, Nicola refers to Cornwall’s flourishing heathtech sector. Cornwall is a rural county with sparsely distributed communities as well as significant towns and coastal developments. The delivery of healthcare is a challenge that relies upon innovation and companies that can deliver that, wherever they are based. A recent trade visit to the Nordic countries, especially Helsinki and Stockholm, helped to consolidate Cornwall’s FDI offer to overseas companies operating in the healthtech sector.

What Invest in Cornwall was able to offer Nordic healthtech companies was the opportunity to visit Cornwall, speak to the UK’s National Health Service (NHS) bodies and demonstrate their products and services to Cornwall’s single NHS Trust and clinical commissioning group. “This is a really exciting field for us,” she says, adding that this type of FDI work is very specific and focuses not just on economic development but also social care – very much a key issue in the UK at present.

Creativetech is also a fast-growing and important sector for Cornwall. Of course, Cornwall’s high-speed connectivity and the lifestyle opportunities afforded by the county help, but Nicola says Cornwall’s success in this sector is very specific; it revolves around very high quality, niche products and attracts people who can deliver those. Crowdfunder and Headforwards are both flourishing in Cornwall and operating on a global scale. Talent is also in strong supply with Falmouth University producing high quality gaming and animation graduates every year.

Agritech is similarly focused on very specific projects in Cornwall. The county is pioneering new technologies with the help of R&D support from Rothamsted Research, Plymouth University and the University of Exeter. The satellite applications organisation SWCoESA is very much the icing on the cake, bringing together satellite communications technology and agriculture to measure and report on agricultural performance to enhance the sector’s output.

Nothing happens without funding and exciting things are now unfurling in Cornwall. The British Business Bank has announced that it is establishing the Cornwall & Isles of Scilly Investment Fund (CIOSIF) of approximately £40m in partnership with the Cornwall & Isles of Scilly LEP. The £40m investment Fund will support access to finance where barriers exist for SMEs, and seek to address an equity gap in start-up, early stage and development capital. It is anticipated that first investments will be made in early 2018.

This is in addition to the pots of funding that are being made available to support the space and aerospace sectors; and Cornwall ‘s marine/renewables sector is also supported by funding. Agritech similarly has a £10m funding pot available for innovation grants. “Cornwall has access to some great finance streams,” says Nicola. “Smart specialisation sectors are being well funded with huge opportunities for businesses to invest and grow if located here.”

So which locations are proving to be rich hunting grounds for Cornwall’s FDI efforts; where are its resources being invested? “The Nordics are very interesting for healthtech,” reiterates Nicola, adding that Cornwall’s efforts are not just focused on supporting healthtech innovation but also implementation (potentially in an NHS environment) and that sets Cornwall apart. The US is similarly important for FDI healthtech work: US companies that are bringing preventative healthcare technologies to the market are especially finding a huge welcome in Cornwall. For agritech purposes, New Zealand is a strong match for Cornwall, partly because similar types of farming are performed in New Zealand and its agritech sector has similar strengths. Aerospace and space have a natural affinity with the US as you would expect, and Cornwall is finding interesting partners in South America for its marine/renewables offer – partly because Cornwall is an ideal location in which to test new marine technologies.

“Our offer for aerospace, space and marine would challenge most regions,” says Nicola. “We have a real focus on smart specialisation matched with funding opportunities.”

She continues: “There are a lot of SMEs interested in Cornwall. They are looking for clients; not hand-outs. We are creating a sustainable FDI opportunity and that delivers a much more loyal investor.”

And there is no doubt that talent is recognised as an enabler to a successful economy. The Local Enterprise Partnership has an established Employment and Skills Board that brings together skills and training providers with local business leaders. Its job is to provide the strategic leadership that synchronises supply and demand for employment and skills to ensure that the needs of Cornwall’s economy are met now and in the future. This includes working with employers to develop higher and degree level apprenticeships to ensure that the rapid emergence of new industries and the demand for new skills can be catered for.

It also means promoting enterprise and work readiness skills in young people which is why Cornwall’s publicly-funded Enterprise Advisers project is so important. This brings together real business people with local schools to give young people an insight into the world of work, the potential jobs available to them, and the routes they can take.

Whilst every LEP area in England has a Growth Hub to enable businesses to be signposted to the correct support available to them, this autumn will see the launch of the publicly-funded Cornwall and Isles of Scilly Skills Hub. It will be aimed at employers and connecting them with the right skills and training to help their business grow. This will include identifying skills gaps, barriers to growth or areas of underperformance that could be overcome with training and additional skills.

In the final analysis, the success of Invest in Cornwall’s FDI efforts is determined, yes, by the number of jobs created but also by the quality of those jobs and the career progression offered. Quality of products is also part of the mix and so too is the high level of export from Cornwall.

“In the UK, we have to challenge what people expect of Cornwall. We have amazing businesses and opportunities here and that is surprising to some. Invest in Cornwall enables foreign companies to establish themselves in the UK. This is an exciting time to drive that forward,” she concludes.