Katherine Wilkes, Audit Partner at Gravita, opened a dynamic event at Jesus College, Oxford, co-hosted with HSBC and Mills & Reeve. The session featured guest speakers James Pomeroy, Global Economist at HSBC and Peter Anderson, Senior Director of Business Operations Ellison Institute of Technology (EIT), both providing valuable insights into the global economic landscape and cutting-edge developments in technology and science.
Global economic outlook – tariff uncertainty
James Pomeroy began the discussion with a survey of current economic challenges and trends both nationally and internationally. He provided an analysis of the US economy, addressing the impact of recent tariff rollouts and their implications for global markets. He highlighted the possibility of additional tariffs, both country-specific and sector-focused, which could influence industries like electronics, clothing, and household goods. While such changes are expected to take time, he noted that the UK remains relatively insulated from these tariff pressures, having leveraged its post-Brexit flexibility to form new international partnerships.
US economy slowing?
Turning to the US, James explained that while the first half of the year showed steady growth, there are signs of slowing, particularly in the job market and among businesses adopting a more cautious outlook. However, consumer spending in the US remains robust, with an unexpected 0.6% monthly increase. He pointed out that while the US faces rising cost pressures, particularly in non-domestic sectors like clothing and electronics, global supply chain issues continue to weigh heavily on the economy. For example, bananas, a surprisingly apt metaphor for wider economic challenges, have seen an 8% inflation rate, driven by their heavy reliance on imports.
On a broader scale, James noted a clear dip in Chinese exports to the US. However, closer inspection suggests that China is redirecting its trade to Europe or exporting goods to lower-tariff countries, to then re-export to the US. He explained that China has also introduced fiscal stimulus policies to bolster domestic spending and support its post-pandemic recovery.
Energy price reduction
Looking ahead, James predicted a reduction in global energy prices, though consumers are unlikely to see immediate benefits, with changes expected in 2026. He touched on the oil market, explaining how Saudi Arabia’s production quotas, despite decreasing demand, are influenced by long-term infrastructure needs, including preparations for the upcoming Asia Winter Games in 2029.
Good news for UK – but challenges ahead
Despite global challenges, James highlighted that the UK is the fastest-growing economy out of the European G7 countries in the first half of 2025, noting a slight but steady momentum in the business and labour markets. Inflation remains high at around 4%, a challenge shared globally, though tax increases in November and next year may help to balance fiscal priorities.
James also addressed the ongoing issue of government debt, particularly driven by an ageing population. With the number of pensioners increasing and life expectancy rising, he posed the important question of whether the UK should reconsider its pension system, potentially introducing means testing or other reforms. Similarly, debates around healthcare funding, such as introducing fees for GP appointments, could help relieve pressure on government debt.
James remained optimistic about economic growth, although in the near future, he saw AI advancements only contributing to a 0.5% boost to the global economy, leading him to conclude that it isn’t a panacea.
Ellison Institute of Technology – breaking new ground in Oxford
In a discussion with Peter Anderson, Senior Director of Business Operations at EIT, James explored the exciting work being done at the Ellison Institute of Technology, which is at the forefront of technological and scientific innovation. Peter shared EIT’s strategic focus on four key areas over the next five to ten years and beyond: Health, Medical science and Generative Biology; Food Security and Sustainable Agriculture; Clean Energy Generation and Storage; Artificial Intelligence and Robotics. He emphasised EIT’s unique structure as a self-sustaining corporation, funded by a single, long-term investor with a vision for projects that are often outside the scope of traditional venture capital. This setup allows EIT to take bold risks and fund groundbreaking initiatives without the pressure of short-term profits.
Growth and opportunity
Peter also highlighted EIT’s remarkable growth, from just 12 employees in 2023 to 250 today, along with its ongoing commitment to education, offering substantial scholarships in partnership with Oxford University. He spoke highly of the collaboration between Oxford and AstraZeneca during the pandemic, praising the agility of the University and its ability to execute projects without bureaucratic obstacles as a reason for Larry Ellison’s choice of Oxford as a locus for his investment here. Peter also noted that while the institute is excited to attract brilliant scientists from around the world, there are challenges such as housing and infrastructure that need to be addressed in Oxford to support future growth.
Looking ahead, Peter confirmed that EIT anticipates operating at a loss for now as the foundations are laid for breakthrough science, with the single investor’s focus on long-term growth and innovation rather than immediate revenue generation. The Institute’s ultimate goals include spinning out successful companies that will thrive through collaboration and cutting-edge technology.
“If you keep people in their own swim lanes, they reach their limits. So, putting them together with other like-minded people with their own experiences and specialisms, or with additional AI and tech resources, that EIT can fund, they can push through those boundaries and deliver world changing results.”
A case for optimism
William Downing, Head of Mills & Reeve’s Oxford office, concluded the evening with a note of optimism – whilst the perennial challenges affecting growth in Oxford still need to be addressed, the economic forecast gives reason for confident, innovative development and investment to continue in the city and EIT’s plans point to a bright future ahead.
