Edward George: Asian businesses have made us more prosperous

From a speech given by the governor of the Bank of England at the Asian Business Association dinner in London

A couple of months ago, in Glasgow, I joined the Association of Business Community in paying tribute to Mr Yaqub Ali for the remarkable contribution he has made to Scottish commercial and community life since he arrived from Pakistan 50 years ago.

It was a poignant occasion, coming as it did when the terrorist attacks of 11 September in New York and Washington were still fresh in our minds. Those events, sadly, have sometimes been represented – or misrepresented – as having something to do with ethnic or religious differences. But, as the universal condemnation of terrorism which followed the events of 11 September showed, they had nothing to do with ethnic or religious differences; they were a reflection of a fanaticism which has no place in any civilised society. Nevertheless, they clearly had the capacity to accentuate perceived differences, and to provoke unwanted tensions within our international, national and local communities.

The contrast between this concern and the example and experience of Mr Ali, which we celebrated that evening in Glasgow, could not have been more pronounced. Whatever the difficulties he faced – of social disadvantage, and no doubt, too, of some degree of ethnic prejudice in the UK – Mr Ali overcame them. From modest beginnings, he moved on to build a series of substantial businesses not simply to his own benefit but to the great benefit, in terms of both the goods and services, and the income and employment which he provided to the community which adopted him.

This example of the contribution that ethnic minority businesses – given proper opportunity and encouragement – can make to our economy is not unique. The Bank of England's investigation, 18 months ago, into the availability of finance to ethnic minority firms suggested that while the ethnic minorities represent some 5 per cent of the UK population, they controlled some 7 per cent of UK businesses and accounted for around 9 per cent of start-ups. Those national figures relate to 1997, so they are a little out of date. But figures from the London Chamber's report, published last December, on the contribution of Asian business to London's economy, suggest that the ethnic minority population manages or owns some 20 per cent of London's private sector businesses, with the Asian community alone accounting for half that – or some 10 per cent of the total. These figures make a powerful point, underlined by the presence of so many Asian and non-Asian business and professional people here this evening.

They illustrate vividly the great benefit that can accrue to our society from providing the opportunity to all the people in the UK, whatever their background, to realise their full potential and achieve all that they can in their different fields. It underscores the importance of non-discrimination, whether ethnic or religious, sexual or social, to the material as well as the moral progress of our community.

Since the Summer of 1992, inflation, on the target measure has averaged just 2.6 per cent – and has been more stable than at any time in our history. But the even better news is that stable, low, inflation has been accompanied by steadily increasing overall output and employment.

Some of you – given what's happening in your own businesses – are probably thinking that I must live on a different planet. And yes, we do have a problem. Once you look beneath this apparently benign surface of the economy, you find substantial differences between many internationally exposed sectors of the economy – including, many manufacturing businesses – which have been having a really tough time, and other businesses, largely serving our domestic market, which have generally been doing much better.

The past year or so has been a difficult time for the world economy which made life difficult for the internationally exposed sectors of our own economy. We are not yet out of the wood, but there is light between the trees.