LONDON (Reuters) - Britain’s government said on Monday it will join industrial partners to create a 2 billion pound ($3 billion) aerospace center, part of efforts to bolster manufacturers as it struggles to revive a flagging economy.
Aerospace is one of Britain’s most important industrial sectors, and the new UK Aerospace Technology Institute is expected to focus on developing technology for the next generation of quieter, more energy-efficient aircraft.
Each partner is providing half the funding for the venture, which the government expects to secure up to 115,000 jobs in the aerospace sector and its supply chain.
Almost all the government contribution is new money, the Department for Business, Innovation and Skills said.
The announcement comes two days ahead of the state budget, in which finance minister George Osborne is expected to stick to his guns on austerity, despite mounting calls for a change of course in an economic environment characterized by near-zero growth and slow progress on deficit reduction.
“We’re doing all we can to maintain this jewel in our crown (and)... maintain Britain’s position as the center of aerospace technology,” Deputy Prime Minister Nick Clegg said in a statement.
The government says aerospace supports more than 3,000 companies and employs 230,000 people in Britain, and expects the global civil aerospace market to grow to become worth more than $4.5 trillion by 2031.
The government also said it had committed an additional 500 million pounds to boosting sectors in which Britain has a comparative global advantage, such as agricultural technology and life sciences.
While Britain does have a relative head start in some high-tech sectors, others are catching up. China has replaced Britain in the world’s top five arms-exporting countries, a Swedish think-tank said on Monday.
Reporting by Mohammed Abbas; Editing by John Stonestreet