I am confident that Britain can be one of the world's great manufacturing nations. While we will never again be a powerhouse of heavy industry, we can lead the world in high-tech, high-value manufacturing.
We start from a position of tremendous strength. We have world-beating companies in fields like pharmaceuticals and aerospace; we have world-beating universities, with four in the global top ten; and we have world-beating scientists, winning more Nobel Prizes per capita than any other sizeable country.
Yet at the moment, we fail to capitalise on that strength. All too often we lag behind our competitors in translating the fruits of scientific research into commercial success. Too many ideas fall into the "valley of death" between the lab and the market, or are whisked abroad to be commercialised. We need to be more than a home of great ideas; we need to be the place where those ideas are turned into successful products.
That is a complex problem, but it is not insoluble. Britain can do three things to transform itself into a global centre for advanced manufacturing.
First, we need to be a competitive environment for business in general. That requires familiar measures such as scrapping red tape, reducing taxation, and improving infrastructure. It is tedious work and offers few political rewards, but it really makes a difference. Second, we need more skills, particularly in engineering. Engineers are the natural bridge between science and commerce, giving practical application to great ideas. Yet we are failing to train enough, at every level from apprentices to doctorates. We need to excite young people about engineering and explain how great engineers can change the world.
Finally, we need to do more to encourage risk taking. Developing a new idea into a product is risky and for every success, there are many failures. Before Google there was Infoseek, Excite, Altavista and plenty of others. Because those companies were able to try and fail, the world got Google.
Encouraging risk taking and entrepreneurship is difficult. It is partly cultural: we need to be more tolerant of failure. But there is also a concrete role for government in sharing risk with companies at the early stages of production.
That does not mean a return to the days of politicised decisions and indefinite subsidies across huge swaths of the economy. It means intelligent support in advanced sectors, like biotech, materials and energy, where we have the potential to be the best. When a great idea succeeds, the benefits are felt far beyond the company who develops it, as innovations spill over to create clusters of success.
If we get those three things right, skills, competitiveness and risk-taking, we can build on our strength, and grow a flourishing productive sector. That is important, because manufacturing offers long-term jobs and stable prosperity in a way that no other sector can.
Lord Browne of Madingley is a partner at Riverstone LLC and a former chief executive of BP.