How will MENA countries hit FDI targets? 

How will MENA countries hit FDI targets? 

Emerging market investments are shrinking. How will MENA countries hit FDI targets? 

By Amjad Ahmad in Atlantic Council

As the pandemic-fuelled liquidity begins to wane and the reality of inflation and higher interest rates sets in, many economies will face considerable challenges.  Middle East and North Africa (MENA) countries are vying to attract global investors and increase Foreign Direct Investment (FDI).  Yet, capital flows are reversing from emerging to developed markets—specifically in the United States, where interest rates are rising to levels not seen since 2018.  The year 2018 is illustrative: during that time, emerging markets experienced substantial capital outflows as international investors reduced their exposure and consolidated their risk into emerging economies with fewer perceived risks, given their proactive and progressive economic policies.

Attracting foreign investors into emerging market economies has always been difficult.  Nevertheless, thanks to the extended period of near-zero interest rates, emerging markets were blessed with investors hungry for higher returns. The plentiful supply of money coupled with historically low yields in rich countries led investors to explore higher yields in riskier markets across various assets, including public equities, public debt, private equity, and venture capital.  The lower cost of capital allowed investors to finance opportunities that otherwise would have been unfeasible.

Unfortunately, the party is over, and the pain is just beginning.  The US Federal Reserve has started an aggressive interest rate hiking campaign, which will likely be the sharpest rise in interest rates since former chair of the Federal Reserve Paul Volcker’s war on inflation from 1979 to 1982.  Many economists believe this will likely lead to a recession in the world’s biggest economy.

A US economic slowdown or a recession couldn’t come at a worse time for emerging markets, particularly those in MENA, where most are fighting chronic unemployment, especially among youth and women, slowing growth, and higher debt levels.  Large oil-exporting countries in the Gulf Cooperation Council (GCC) — such as Qatar, Saudi Arabia, and the United Arab Emirates (UAE) — are better positioned given heightened commodity prices. However, their lack of interest rate autonomy given the dollar peg limits their ability to deviate their monetary policy from that of the United States.

Additionally, the global demand destruction cannot be ignored as the post-pandemic surge in demand levels off, with consumers beginning to feel the pinch from inflation and rising interest rates.  This may put a damper on global energy demand and tourism. Inflation also impacts global emerging markets, causing a perfect storm for the arrival of tough economic times.  Currency depreciation against the dollar is increasing the cost of imports and repaying foreign currency debts for banks, companies, and governments, many of which racked up significant debt during the pandemic.

Research suggests that the impact of US monetary tightening on emerging markets will vary depending on the factors for the change. Interest rate hikes driven by US economic expansion will likely lead to positive spillover effects that benefit more than hurt emerging markets and, therefore, are neutral on capital flows.  On the other hand, interest rate hikes to fend off inflation will likely lead to emerging markets disruption.  Here, there are two key points to mention.  First, there is a more significant effect on emerging markets from rising interest rates due to inflation than those due to growth.  Second, emerging economies with stable domestic conditions and policies tend to fare better and experience less volatility. In a global economic environment with slower growth, higher cost of capital, and a shrinking capital pool for riskier assets, discerning international investors will consolidate their investments in the highest-quality emerging markets.

The Goldilocks moment experienced in markets over the past couple of years is subsiding.  Geopolitical risk, inflation, and US interest rates are all rising. In addition, two crucial macroeconomic trends will impact the future capital flows to emerging markets.  First, globalization policies that have focused overwhelmingly on cost efficiency and rationalization will now focus on resiliency and values-based investments.  At an Atlantic Council event on April 13, US Treasury Secretary Janet Yellen articulated a blueprint for US trade policy, stating, “The US would now favor the friend-shoring of supply chains to a large number of trusted countries that share a set of norms and values about how to operate in the global economy.”

Second, Environmental, Social, and Governance (ESG) issues are gaining more attention with countries and companies putting them on the agenda.  For an indication of what’s to come, consider Total, the French oil and gas giant, marking its shift to renewable energy and rebranding to TotalEnergies, as well as Engine No. 1, a US impact hedge fund, hijacking ExxonMobil’s board to drive a green strategy at the company.  As a result of the confluence of these complex issues on top of challenging macro-economic concerns, investor appetite for emerging market assets is weakening.  It will become more discerning in the coming years.

But all isn’t lost.  There will be divergent outcomes and risks depending on the domestic conditions of each emerging market.  Thoughtful investors will continue to seek opportunities in emerging markets, especially in private markets, where the predominant share of opportunities exists.  However, as financial conditions tighten, differentiation between emerging markets will increase. MENA countries can better position themselves amongst others competing for capital by:

  1. Attracting and empowering strong policymakers to make dynamic and bold decisions that complex changes in the global economy require. Deepening the bench of talented policymakers should be another priority.
  2. Driving policies supportive of private sector development and investment. Reducing government-owned enterprises and providing ample space for private companies to grow and prosper on an even playing field is critical to building a dynamic economy.
  3. Continuing to nurture the nascent entrepreneurial ecosystem. Entrepreneurial economies are consistently more resilient and lead to better outcomes over the long term.
  4. Enhancing regional and international economic integration through bilateral and multilateral agreements with more robust economies. Proactive engagement with multilateral financial institutions will also increase financial stability and resilience.
  5. Standardizing policies according to global norms for greater regional and international integration. Investor appetite is greatly improved in emerging markets that adopt regulations and standards from developed countries.
  6. Increasing transparency and reducing uncertainty around laws and regulations. Investors and companies need more clarity on the game’s rules in order to play it confidently and competently.

Several MENA countries continue to take bold steps to improve their global competitiveness. One such example is the privatization programs of government-owned enterprises in Egypt, Saudi Arabia, and the UAE to increase liquidity in local capital markets, improve transparency, and expand private sector participation.  Those countries that maintain their momentum will be clear winners in the coming years. History is rich with evidence that economic challenges are followed by periods of historic gains.

Amjad Ahmad is Director and Senior Fellow at the Atlantic Council’s empower ME Initiative at the Rafik Hariri Center for the Middle East.  

Twitter: @AmjadAhmadVC.

 

Tackling corruption is focus for MENA in 2022

Tackling corruption is focus for MENA in 2022

The MENA countries where socio-political monopolization is fundamentally due to low levels of democracy and obscure political transparency have generated over the years Corruption. All attempts to strengthen business integrity and fight corruption were in vain. Chatham House‘s post on the subject of Tackling corruption is the focus for MENA in 2022 is worth going through. Here it is.


Integrity is central to the development of competitive and open economies in which growth and opportunities are sustainably and equitably distributed.

To tackle corruption in the MENA region, the international community must prioritize accountability over stability.

Tackling entrenched corruption will be a key focus of the political discourse in the Middle East and North Africa in 2022. International policymakers will look to anti-corruption as a framework that can be used to help stabilize conflict countries, support economic reform, or to pressure adversarial regimes. Pressure to deal with corruption also stems from popular anger in countries that suffer from poor governance as corruption can have very serious – even fatal – consequences, as the deadly hospital fires Iraq suffered last year illustrate.

Corruption can have very serious – even fatal – consequences, as the deadly hospital fires Iraq suffered last year illustrate


Across the region, anti-corruption processes are meant to signal accountability. However, they can also be weaponized by elites to consolidate power and target opponents, particularly in countries where the political system itself is built on politically sanctioned corruption. This makes anti-corruption efforts unlikely to succeed. These dynamics highlight the need for international policymakers to develop strategies that promote accountability and transparency over the long term instead of prioritizing political expediency.

Anti-corruption efforts not what they appear

At first glance, anti-corruption processes underway across the Middle East and North Africa appear to suggest that states in the region are serious about combatting graft. In Libya, a recent wave of arrests by the attorney general has seen two sitting ministers, a former deputy prime minister and a former head of a state-owned investment vehicle detained on charges of corruption. In Iraq, the commission of integrity and the prime minister’s special committee have arrested dozens of former and current officials on charges of corruption.

Across the GCC, governments are seeking to double down on their economic diversification plans. Against the rising tide of nationalism and populism, anti-corruption efforts will feature as part of a good governance agenda that serves a domestic audience by targeting elites and patronage networks. The UAE is the GCC’s most nimble economic player and leads the pack in efforts to stamp out corruption. In Lebanon, political competition and initiatives by members of the judiciary have resulted in investigations of alleged corrupt practices by the heads of major state institutions such as the central bank.

The case of Lebanon has clearly illustrated that appeasing elites does not deliver stability, and countries such as Iraq and Libya could potentially face a similar fate.

But appearances can be deceiving. In none of these countries have anti-corruption efforts led to meaningful change. In Libya, past efforts have petered out and officials have all too rarely faced trial, let alone been convicted. There is little to suggest this round will be any different as the government is unlikely to support the attorney general’s cause. In Iraq, this year’s top story will be the protracted government formation process following last year’s elections – a process rife with politically sanctioned corruption as the usual cast of characters come together to negotiate their share of power and money. Despite the 2019 October revolution that called for reform of Iraq’s ethno-sectarian political system (muhassasa), not much has changed.

Saudi Arabia, which is pushing ahead with its Vision 2030 targets, has an anti-corruption agenda but will face challenges in connecting its legal framework and process, led by the Oversight and Anti-Corruption Authority (Nazaha), with realities on the ground. Many sectors suffer from a lack of transparency when it comes to decision-making, yet the importance of personal and social connections (wasta) remains high in Saudi society.

Weaponizing anti-corruption processes

The darker side of the anti-corruption drive is the weaponization of such processes, whereby corruption allegations can be used to settle political scores, especially by those who are politically dominant. In Lebanon, this can be seen in the growing standoff between the governor of the central bank and Hezbollah and its allies, who see him as a political opponent.

The darker side of the anti-corruption drive is the weaponization of such processes, whereby corruption allegations can be used to settle political scores.

In Iran, under pressure from US-imposed sanctions, President Ebrahim Raisi will continue to promote anti-corruption measures to demonstrate good governance and accountability to help distract from the economic pain of sanctions. However, these efforts will by no means root out entrenched corruption. The Islamic Revolutionary Guard Corps (IRGC) and various parastatal entities have used predatory sanctions-busting strategies to ensure their economic survival, while crowding out the private sector. Without meaningful reform of the economic system, the government will likely see more protests and unrest.   

The scale of the challenge facing the international community

There is no doubt that these problems will be difficult to tackle. Corruption stretches far beyond the upper levels of government. Where corruption has become politically sanctioned, such as in Iraq, the elite has shifted its focus away from formal government roles, such as cabinet ministers, who are now by design independent and technocratic, but weak. Instead, the key to state power has become the almost 1,000 senior civil servants under the special grades scheme, who do the elite’s bidding in government ministries and agencies without any transparency or accountability. They may not be the minister in charge, but these director generals and deputies make the decisions when it comes to government contracts and procurement, helping to generate huge sums of money for those whose interests they serve.

Any successful anti-corruption strategy must go beyond sanctions on individuals to address the core of the problem – the economic system of governance.  

The international community have opportunities to address some of these entrenched problems this year. But its record to date is mixed. In Libya, the international community’s credibility on corruption has been greatly damaged by it prioritizing stability over accountability. A long-awaited audit of the Central Bank of Libya drew ‘no conclusion or determination’ over ‘any fraud or misappropriation’, while a UN report into allegations of vote-buying at the UN-created Libyan Political Dialogue Forum that selected the current government has not been made public. These developments have only strengthened the impression that Libyan officials enjoy impunity. As the Libyan political process is reshaped in 2022, measures to ensure accountability and transparency must take a much more prominent place in the architecture of international efforts.

Lebanon is perhaps the greatest test of the international community’s commitment to tackling widespread graft. In need of an economic rescue plan to reverse the severe depreciation of its currency and decline in GDP and foreign reserves, there is hope that a deal with the IMF and international assistance could materialize this year. The IMF and international bodies like the EU insist that any aid will come with conditionality regarding reforms, but there are fears they may soften their stance. They must hold firm. If their current position softens, this will damage both Lebanon and the credibility of the international community.

The international community must prioritize the legitimate grievances of MENA citizens, rather than pleas by entrenched elites to help maintain ‘stability’. The case of Lebanon has clearly illustrated that appeasing elites does not deliver stability, and countries such as Iraq and Libya could potentially face a similar fate.

Any successful anti-corruption strategy must go beyond sanctions on individuals to address the core of the problem – the economic system of governance. 

The image above is of Image — A man checks electrical wires in Baghdad, 13 September 2017. For years Iraqis have denounced the bad management and financial negligence that have stifled the country and let its infrastructure fall apart. Photo: AHMAD AL-RUBAYE/AFP via Getty Images.

Authors:

Tim Eaton, Senior Research Fellow, Dr Lina Khatib, Director, Dr Renad Mansour, Senior Research Fellow, Project Director, Iraq Initiative and Dr Sanam Vakil, Deputy Director and Senior Research Fellow, all of Middle East and North Africa Programme.

UAE to launch first federal corporate tax on business

UAE to launch first federal corporate tax on business

In response to the current local economy, the UAE has decided to launch the first federal corporate tax on business profits from June 2023. Hadeel Al Sayegh and Moataz Mohamed elaborate on the details.

The image above is of a general view of Sheikh Zayed Road in Dubai, United Arab Emirates, December 08, 2021. REUTERS/Satish Kumar/File Photo


UAE to launch first federal corporate tax on business profits from June 2023

People walk on the Pedestrian Bridge at the Bluewaters Island in Dubai, United Arab Emirates, December 08, 2021. REUTERS/Satish Kumar/File Photo
A general view of Sheikh Zayed Road in Dubai, United Arab Emirates, December 08, 2021. REUTERS/Satish Kumar/File Photo

DUBAI, Jan 31 (Reuters) – The United Arab Emirates (UAE) on Monday said it would introduce a federal corporate tax on business profits for the first time starting from June 1, 2023, although it kept the rate low, at 9 percent, to maintain its attractiveness for businesses.

The Gulf Arab oil exporter, a magnet for the globe’s ultra-rich, has long benefited from its tax-free status to carve out a role as an international commercial, energy and tourism hub.

Much of this tax-free regime, including no personal income tax, remains. But the Finance Ministry said it was launching corporate tax to align with international efforts to combat tax avoidance, as well as to address challenges arising from the digitalisation of the global economy.

The new tax will be levied on all corporations and commercial activities in the country, except for the “extraction of natural resources” which will remain subject to taxation at the emirate level.

A ministry statement said the new regime implies a standard statutory tax rate of 9%, as well as a 0% rate for taxable profits up to 375,000 dirhams ($102,107.50) in order to support small businesses and startups.

The ministry added that the move would pave the way for the introduction of a global minimum tax rate that would apply a different corporate tax rate to large multinationals that meet specific criteria.

It did not elaborate, but this appeared to be a reference to new rules agreed by the Organisation for Economic Cooperation and Development in October and 136 countries including the UAE to ensure big companies pay a minimum tax rate of 15%. Read more

The move to a tax of 9% chimes with the country’s efforts to diversify budget revenues to reduce reliance on petroleum, for decades the mainstay of the economy.

“The UAE continues to make progress in diversifying its budget revenue away from oil, and a corporate tax fits into this strategy. The tax rate remains low by global standards,” said Khatija Haque, chief economist at Emirates NBD.

“With the international tax treaty signed at the end of last year, many corporates may still have to pay a top-up tax in their country of residence. It is positive for the UAE to earn the tax on the business conducted and income sourced domestically,” said Monica Malik, Chief Economist at Aby Dhabi Commercial Bank.

In 2018, the UAE introduced value-added tax on most goods and services at a standard rate of 5%. The UAE imposes a 20% tax on branches of foreign banks operating in the country, and on companies with concession agreements in the oil and gas sector of up to 55% at the emirate level.

Businesses in the UAE are exempted from paying taxes on capital gains and dividends received from shareholdings, the ministry said.

The new programme left intact the exemption for individuals from income tax, capital gains tax on real estate and other investments, and other earnings that do not come from a business.

The UAE corporate tax regime will continue to honour the corporate tax incentives currently being offered to free zone businesses that comply with all regulatory requirements and that do not conduct business with mainland UAE, the ministry said.

($1 = 3.6726 UAE dirham)

On the bandwagon to Glasgow: Climate action in the MENA region

On the bandwagon to Glasgow: Climate action in the MENA region

Al Jazeera in its Opinions on the current Climate Crisis published this article of Karim Elgendy, a Sustainability consultant based in London on how certain counties will be travelling on the bandwagon to Glasgow to relay what Climate action in the MENA region will consist of.

Countries like Saudi Arabia, Turkey and the UAE not only jumped on the climate bandwagon, but they may also be attempting to control its steering wheel.

On the bandwagon to Glasgow: Climate action in the MENA region
Turkish President Recep Tayyip Erdogan recently announced his country’s plans to become carbon natural by 2053 [Dado Ruvic/Reuters]

In the few weeks leading up to the upcoming UN climate change summit in Glasgow – known as COP26 – the Middle East and North Africa (MENA) region witnessed an unprecedented shift in its climate policy.

The MENA region has often had a complicated relationship with climate change and the actions required to address it.

Regional greenhouse gas emissions continue to grow on every front. In fact, during the 40 years preceding the 2015 Paris Agreement on climate change, the MENA region was the only one where total emissions, emissions per capita, and emissions per dollar of gross domestic product (GDP) all increased. Many of the region’s countries also have rentier economies that are dependent on fossil fuel exports, and so are concerned about the loss of revenues. Yet the region is also disproportionately at risk from climate change impacts, not only relative to its small share of historic greenhouse gas emissions, but also relative to its share of the global population and global GDP.

In the annual UN climate summits known as Conference of Parties – or COP for short – countries of the MENA region have often played a role that reflected this complicated relationship. They often appeared hesitant to advocate for ambitious climate action and generally opposed rapid decarbonisation claiming it will damage their developing economies. Some countries demanded international funding especially when it comes to adapting to climate change, while others made claims for compensation for possible loss of fossil fuel revenues.

As a regular observer of the annual climate negotiations, I often felt that the region was trying to hold back the tide. While the scientific community reached a consensus on transitioning to a low-carbon economy fuelled by renewable energy, and as world leaders were busy working out the details of this transformation, the region looked like a straggler stuck in a puddle of oil.

Fuelling competition, eventually

The Paris Agreement, while restoring hope in averting the worst effects of climate change, did not alter these dynamics immediately. The accord’s bottom-up approach allowed each country to voluntarily determine how much it is willing to commit to the fight against climate change. Initially, this allowed countries to pledge as little as possible, which led to a collective global commitment that fell short of the Paris Agreement’s goal to limit global warming to 1.5C.

However, the genius of the agreement only transpired over the last couple of years, when it started driving competition between nations to revise their commitments upwards. As the global transformation to a low-carbon world appeared inevitable, many countries figured out that by committing to ambitious climate action sooner rather than later they will be better positioned to shape this new world rather than be shaped by it. Many nations also figured that as first-movers, they could establish themselves as global or regional leaders through climate diplomacy.

So despite the COVID-19 pandemic, more commitments for deeper cuts in greenhouse gas emissions were made by developed economies. Some nations also set long-term strategies to reach zero carbon by the middle of the century including the European Union, the United Kingdom, the United States, China, Canada, and South Korea.

Leaving the puddle behind

Earlier this year, signals were already emerging in the MENA region that climate diplomacy is becoming central to the diplomatic arsenal of its powers as they competed for regional leadership and to fill a perceived power vacuum. Yet in the run-up to COP26 these powers have all picked up the pace by committing to long-term climate goals that were not on the cards less than a year ago.

Just in the last few weeks, we saw a flurry of regional announcements from Turkey, Saudi Arabia, and the United Arab Emirates (UAE) signalling their intention to become zero-carbon economies by the middle of the century. A few months earlier, Israel had also announced an “almost zero” carbon plan, by pledging to reduce its emissions by 85 percent in 30 years. Iran is now the only regional power that is yet to develop an ambitious climate target or even ratify the Paris Agreement.

The Turkish announcement of its plans to reach carbon neutrality by 2053 came first and was followed within days by the UAE’s 2050 Net-Zero Initiative which was hailed as the first such target by an oil exporter outside of The Organisation for Economic Co-operation and Development or OECD. The Saudi announcement earlier this week outlined the kingdom’s vision to reach zero carbon by 2060 as part of the Saudi Green Initiative and its regional vision, known as the Middle East Green Initiative. Bahrain immediately followed with a similar pledge.

Unsurprisingly, there are many commonalities between these announcements. They all included plans to dramatically expand their renewable energy capacity and improve energy efficiency. Turkey, Saudi Arabia, and Israel also share plans to use tree planting as a carbon-capturing measure, while Turkey and Arabia both plan to develop an emissions trading scheme.

Yet climate policy always reflects national circumstances and priorities. Saudi Arabia and the UAE have made it clear that despite their commitment to reducing emissions from their oil and gas industries, their plan is to maintain their role as big fossil fuel producers. In fact, the Saudi climate commitments are conditional on its ability to maintain its fossil fuel exports.

Saudi Arabia’s green initiatives are also unique in promoting the Circular Carbon Economy – a new approach that the kingdom is championing which proposes that fossil fuels are not immediately phased out, and advocates removing carbon from the atmosphere using trees in addition to carbon capture and storage technologies.

Financing these visions is also a differentiating factor; while Saudi Arabia, the UAE, and Israel are all making unconditional commitments and do not seek climate funding, Turkey’s move is likely to have been influenced by its efforts to access the growing climate finance flows.

Such announcements are nothing short of transformative economic visions. By introducing these emission reduction targets, the regional powers are setting in motion a direction of travel for their economies for the next 30 to 40 years, shaping all future infrastructure spending, and signalling to their peoples and businesses to start moving towards products and services that have minimal effect on the environment.

Working alone and succeeding together

But long term visions need short-term plans, and regional powers have also increased their 2030 emission reduction pledges ahead of COP26, in line with their commitments under the Paris Agreement.

Saudi Arabia, for example, committed itself to reducing its greenhouse gas emissions by 35 percent by 2030 while the UAE committed to a 23.5 percent reduction, both compared with business-as-usual scenarios. Israel on the other hand committed to a 27 percent reduction in emissions compared with 2015. Other countries across the MENA region have also raised their 2030 targets including Morocco, Tunisia, Lebanon, Jordan, Oman, Qatar, and Sudan. Most of these revised pledges remain relatively modest, indicating that the journey to zero carbon will be slow, to begin with, but they are certainly moving in the right direction.

The new climate focus may also be bringing the region together, as different countries attempt to lead regional climate efforts. Saudi Arabia has gone further than anyone else in fostering a sense of regional collaboration around its vision by launching the Middle East Green Initiative and by inviting 30 regional and international leaders as well as the Arab League to support it. It has also announced the establishment of a regional centre for carbon capture and storage, as well as an investment fund and a collaboration platform to support its Circular Carbon Economy approach.

This collaboration could not have come a moment too soon in a region so vulnerable to the impacts of climate change. Regional countries can either succeed together or fail alone.

More engagement

Next week, as the world’s eyes turn to Glasgow, many would be looking to see if these impressive developments in the MENA region’s climate policy would translate into a different negotiating position and more international collaboration.

The region’s countries might have individually arrived at a conclusion that being at the table could help them shape the new world being forged. And while the priorities of Saudi Arabia, the UAE, Turkey, and Israel vary significantly, a coalition around a regional climate plan might be in the offing, with a different approach than that of European countries currently driving climate action.

How this plays out remains uncertain, but one thing is indisputable; the region wants to become more engaged in shaping the future. The fact that Egypt has been selected to host COP27 next year, while the UAE is the frontrunner to host the following COP in 2023, is further proof of that.

The MENA region not only jumped on the climate bandwagon, but it may also be attempting to control its steering wheel. Over the next months and years, we will find out if it succeeds and what direction it might steer it towards.


On the bandwagon to Glasgow: Climate action in the MENA region
Karim Elgendy

Karim ElgendySustainability consultant based in LondonKarim Elgendy is a sustainability consultant based in London. He is an Associate Fellow with Chatham House and the founder of Carboun, an advocacy initiative promoting sustainability in cities of the MENA region.

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To give architecture political clout we must engage with ordinary people

To give architecture political clout we must engage with ordinary people

The Architects Journal with Leanne Tritton, author, elaborated this article on how to give architecture political clout, we must engage with ordinary people.

To give architecture political clout we must engage with ordinary people

The architecture and built environment sector has a poor track record in communicating with the general public, something those in power are all too aware of, writes new chair of The London Society Leanne Tritton

My business is communication. I love working alongside built environment professionals, and in my day job I am fortunate to see at first hand how architects and developers are working hard to positively design and build better places.

But, sadly, few members of the general public see our sector in the same light. It is not surprising, given that the media generally focuses on the negative and the sensational. That’s just a fact of life. But we haven’t gone out of our way to help ourselves and present the other side of the story or co-ordinate campaigns that inform opinion.

For obvious reasons, central and local government is preoccupied by the feelings of the nation. It seems the built environment’s only meaningful connection with the population of this country is via a series of consultations that accompany proposed development. As these make their way through the planning process, such efforts often descend into almost hand-to-hand combat.

Put simply, we’ve not had strong enough links with either the general public or government to promote effectively what we do.

It also does our industry no credit that we have such a poor track record when it comes to engaging with the country’s political leadership and working to influence policies that will not only benefit our sector, but the greater good.

Politicians know that we have limited ‘clout’ and so have been able to dictate the pace and degree of change that takes place, and do so on their terms.

This needs to be put right, although it’s not to say there aren’t those who seek to engage with ordinary people about the buildings all around them. I have long admired the work undertaken by Open City, which, as well as running a series of events highlighting the architectural wonders of the capital, also organises the annual Open House festival. This event, which lasts for just a few days every year, gives people unparalleled access to some of London’s finest buildings.

It is also hugely encouraging to see Simon Allford, co-founding partner of AHMM, elected as president of the RIBA. Allford will not only be able to offer the institute effective leadership, he is the type of person who can walk into a room full of government ministers and have an immediate and positive impact.

Then there is The London Society (TLS). Established in 1912 by a group of Londoners concerned about the lack of planning in the capital, its theme 110 years on will focus on the connections among communities and those organisations that sit beyond those of built environment professionals and which have the potential to make the city stronger.

Having recently joined TLS as chair, I believe the organisation has a unique opportunity to present the built environment’s case outside the industry bubble.

Members of TLS come from all walks of life, not just the professions. All share a passion for the city and want to engage with the debates about its future, while also recognising – and indeed cherishing – its past. It is an organisation for all those who love London, forging links with underrepresented communities across the capital and, usefully, having the ear of MPs, sponsoring as it does the All-Party Parliamentary Group on London Planning and Built Environment.

The time for engagement is upon us and we need to fund those organisations that give us critical mass and help the public understand that we are on their side.

Leanne Tritton is managing director of ING Media and chair of The London Society. As part of the AJ100 Festival, she will be speaking at the panel debate COP26 – How can we get better at influencing government? at 9.35am on Monday 20 September.