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Speaker 1: So here at Bloomberg, we're concerned with the economy, and

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Speaker 1: the global economy has been based to a significant degree

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Speaker 1: on the multinational institutions created in the wake of World

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Speaker 1: War Two. They seem to be moving, maybe even dissolving.

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Speaker 1: What comes next as we see the future and particularly

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Speaker 1: as with the UN meets here now struck by the

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Speaker 1: fact that the president of China, the President of Russia,

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Speaker 1: the President of France, and the Prime Minister of the

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Speaker 1: UK aren't even showing up to the UN.

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Speaker 2: Yeah, well, you've got a very divided world today, and

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Speaker 2: a lot of the institutions have grown up on the

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Speaker 2: basis that everyone can come together essentially around an American

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Speaker 2: centric view of the world and Russia, you have China.

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Speaker 2: You have countries that don't want to be aligned either

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Speaker 2: with America or with China, but want to keep in

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Speaker 2: with both. So you've got a completely different world that's evolving,

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Speaker 2: and the institutions were all created for a different time.

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Speaker 2: So even the UN Security Council, when you think about it,

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Speaker 2: it's completely irrational that you don't have Germany or Japan,

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Speaker 2: or India, Brazil, Indonesia, you know, large countries that aren't

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Speaker 2: represented in the permanent structures of the UN. The difficulty

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Speaker 2: is how do you how do you change those institutions

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Speaker 2: when you require everyone's consent to do it. So I

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Speaker 2: think you're going for the foreseeable future, there will be

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Speaker 2: issues around which people come together, you know, global pandemics,

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Speaker 2: potentially climate change, maybe stabilizing the global economy. There's areas,

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Speaker 2: of course where America and China are going to have

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Speaker 2: to work together. But the world is multipolar and polarized

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Speaker 2: around essentially, I think to two blocks that are emerging,

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Speaker 2: one of countries that are close allies of America, the

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Speaker 2: other which are allies of China.

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Speaker 1: Does that almost necessarily mean will have a more reduced

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Speaker 1: growth going forward globally because we had two blocks to

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Speaker 1: the Soviet and the United States. But the Servieian wasn't

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Speaker 1: that big an ecoming player China is.

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Speaker 2: Yeah, that's the huge difference. I mean when the Soviet

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Speaker 2: Union broke up, I think its exports to the US

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Speaker 2: was unping, like two hundred million dollars, I mean hundreds

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Speaker 2: and hundreds of billions of dollars of trade still existing

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Speaker 2: between America and China. China obviously holds I think almost

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Speaker 2: eight hundred billion dollars worth of dollar reserves, so you

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Speaker 2: know it's a this is at one level, it's much

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Speaker 2: more integrated. But in these past few years, you know,

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Speaker 2: globalization has come under attack for reasons that are good

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Speaker 2: in one sense when you look at issues to do

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Speaker 2: with security and people's anxieties about supply chains and so on.

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Speaker 2: But then I think also issues that are more to

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Speaker 2: do with protectionism, and we should never forget that the

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Speaker 2: era of globalization brought enormous benefit to the world, including

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Speaker 2: high levels of growth, low levels of inflation, and of

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Speaker 2: course great numbers of people lifted out of poverty.

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Speaker 1: One of the areas where there is continued at tension

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Speaker 1: is something you know terribly well, which is the Middle East.

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Speaker 1: You spend a lot of time over there, I know,

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Speaker 1: particularly on the Palestinian issue. Now we hear that there

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Speaker 1: may be the makings of a deal with Saudi Arabia,

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Speaker 1: the United States and Israel. What do you know about that?

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Speaker 1: What are the prospects for it? I think you still

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Speaker 1: advise a Saudi government, don't do you know?

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Speaker 2: Yeah, we've a close relationship with many of the countries

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Speaker 2: in the region. We have a team of people work

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Speaker 2: on the modernization program there in Saudi. I have an

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Speaker 2: office in Israel, and also in the United Arab Emirates. Well,

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Speaker 2: the whole of the Middle East is undergoing a huge change,

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Speaker 2: and I think the essence of the struggle in the

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Speaker 2: Middle East really revolves around the desire of people there

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Speaker 2: across the cultural spectrum, right whether you're in the Jewish

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Speaker 2: State of Israel or in predominantly Muslim countries, the desire

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Speaker 2: of people to move towards what I call rule based

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Speaker 2: economies and religiously tolerance societies. And when you look at

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Speaker 2: the modernization program, for example, it's going on in Saudi,

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Speaker 2: or in the United Arab Emirates or elsewhere in the Golfment,

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Speaker 2: Katabahrain ands on, you can see that it's illogical for

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Speaker 2: those countries to be hostile to Israel. I mean that

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Speaker 2: they share many of the same anxieties about the region

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Speaker 2: and particularly the role of Iran. They can see in

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Speaker 2: the State of Israel, for all its challenges and difficulties,

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Speaker 2: right now, a country that's become extraordinary in terms of

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Speaker 2: the development of its economy, its technology and so on,

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Speaker 2: that plays an outsize role in the world. And therefore,

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Speaker 2: if you're looking at this from the perspective of the

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Speaker 2: Gulf States, you still care about the Palestinian issue and

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Speaker 2: you would like it resolved, and it remains a critical

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Speaker 2: issue in the politics of the Middle East. But underneath

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Speaker 2: you're thinking, little are all the things we've got in common,

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Speaker 2: you know, So to end up in a situation where

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Speaker 2: you're divided from Israel, it really doesn't make a lot

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Speaker 2: of sense to these countries today.

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Speaker 1: There have been recurring humanitarian issues obviously in the Middle East,

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Speaker 1: but moving on from the eman humanitarian to the economic.

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Speaker 1: Could the Middle East really represent an opportunity? Certainly, Israel

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Speaker 1: has been the startup nation, as they call it. Saudi

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Speaker 1: Arabia and UAE have enormous Qatar have enormous amounts of resources,

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Speaker 1: and Saudi Arabia particularly is trying to diversify their economy.

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Speaker 1: Is there a world in which that is really a

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Speaker 1: growth engine for the world.

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Speaker 2: Yeah, potentially absolutely, And that modernization process is all about

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Speaker 2: these countries that are big oil and gas producers, saying, look,

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Speaker 2: we also see the way the world's changing because of

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Speaker 2: issues to do with climate change and so on, and

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Speaker 2: they want to diversify their economy. They want to educate

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Speaker 2: their people the number of women in the Saudi workforce

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Speaker 2: has virtually doubled in the last six years. But it's

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Speaker 2: all about moving towards an open minded approach to the world,

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Speaker 2: towards the situation where you put religion in its proper

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Speaker 2: place and don't turn it into a political ideology. And

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Speaker 2: therefore where if you're in the region, you're thinking, how

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Speaker 2: do we make sense of this region? Well, the answer

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Speaker 2: is to come together and to be able to do

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Speaker 2: things together in the common interest.

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Speaker 1: Let's turn to British politics, if we could a bit,

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Speaker 1: you've had something to do that with the past. According

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Speaker 1: to the polls, if they're to be believed, the Labor Party,

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Speaker 1: your Labor Party seems like it's in reasonable good shape

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Speaker 1: for the next election. We never know till the election happens,

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Speaker 1: but in a reasonably good shape. You were famous for

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Speaker 1: new Labor, as we came to understand it in Britain.

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Speaker 1: Is there room for a new labor? Is there a

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Speaker 1: different version of what the Labor Party did back in

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Speaker 1: your day?

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Speaker 2: Yes, I think there is, and it's all around the

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Speaker 2: technology revolution. I mean, in my view, the single toughest

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Speaker 2: thing for politicians today is to get their heads around

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Speaker 2: what is the big real world event. I mean, leave

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Speaker 2: all those things aside, with all the things talking about

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Speaker 2: in geopolitics, America, China is on. The big real world

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Speaker 2: event is this technology revolution, and particularly with generative AI.

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Speaker 2: It's going to change everything. It's going to change the

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Speaker 2: way we live, the way we work. It should change

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Speaker 2: government by the way the way government operates, the way

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Speaker 2: public services operate. It's got enormous potential to change the

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Speaker 2: healthcare system for the better. But then there are huge risks.

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Speaker 2: Because it's a general purpose technology, you can use it

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Speaker 2: for bad as well as for good. So this is

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Speaker 2: the biggest challenge. And I say to people on the

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Speaker 2: progressive side of politics, the progressive mission for the twenty

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Speaker 2: first century is how you understand this revolution, master it,

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Speaker 2: and harness it. And that's the because interesting when you

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Speaker 2: look at the nineteenth century industry revolution, it took politics

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Speaker 2: a long time to catch up with the real world

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Speaker 2: event that was happening. And if we're not carefuable'll be

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Speaker 2: the same today. Because the policy makers and the change

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Speaker 2: makers often and habit different spaces, we need to bring

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Speaker 2: them together. We need to see what the opportunities are,

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Speaker 2: see what the risks are. But this is for me.

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Speaker 2: If I was back in government today, I would be

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Speaker 2: reshaping the whole of the government to generate around it.

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Speaker 1: Great Britain had a little something to do, as I

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Speaker 1: recall with the Industrial Revolution, but you were bestride an

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Speaker 1: empire at that point that empire knowlranger exists. Is Great

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Speaker 1: Britain large enough to really help drive the genera of

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Speaker 1: AI revolution.

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Speaker 2: Well, it can be part of it, and it's already

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Speaker 2: one of the leading countries on AI. We've got a

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Speaker 2: strong university sector, We've got a great life science sector.

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Speaker 2: We have one of the greatest AI companies in the world,

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Speaker 2: Deep Mind in the UK. The UK technology sector is thriving.

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Speaker 1: We need to.

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Speaker 2: Keep this and we need to develop it. But now Britain.

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Speaker 2: If I had to characterize the economic niche for Britain

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Speaker 2: going forward, one major part of it would be around

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Speaker 2: being an AI hub for innovation and development.

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Speaker 1: What about the future for Brexit and what happens with

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Speaker 1: the UK care Stromer circuit. Astarmer has said that you'd

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Speaker 1: like to kind of revisit that a little bit. You've

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Speaker 1: been very outspoken about your views on Brexit in the past.

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Speaker 1: How far can the UK go how far should it

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Speaker 1: go to try to reintegrate with Europe.

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Speaker 2: So it's hard to judge because the look we got

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Speaker 2: out of Europe it was our major trading relationship. We

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Speaker 2: ruptured our trading relations with Europe. But we also now

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Speaker 2: are out of the political union of our own continent

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Speaker 2: and in a world where it's going to be dominated

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Speaker 2: by America, by China, possibly in time India. Those will

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Speaker 2: be the three giants of world politics. You're going to

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Speaker 2: find round the world people coming together in regional blocks

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Speaker 2: in order to be able to sit at the same

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Speaker 2: table as the giants. You can see this happening all

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Speaker 2: over the world. So for Britain to be absent from

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Speaker 2: Europe is a real problem for us. However, having left it,

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Speaker 2: getting back in is a tricky, tricky negotiation. There's an

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Speaker 2: economic aspect. I think there are certain things that can

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Speaker 2: move us closer with Europe without going back into the

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Speaker 2: European block. But then I think there's a question of

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Speaker 2: the political dimension to this, and there is a suggestion

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Speaker 2: that you build a broader European political community. President Macron's

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Speaker 2: talked about this and Britain I think can play a

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Speaker 2: part there and in areas like defense or energy or

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Speaker 2: science and innovation. You know, we can build those blocks

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Speaker 2: of cooperation with Europe that move us closer. Whether we

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Speaker 2: get to a stage where Britain rejoins the European Union,

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Speaker 2: I think that's for a future time. But you know,

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Speaker 2: you never forget the two thirds of the population over

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Speaker 2: sixty five voted for Brexit and two thirds under thirty

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Speaker 2: five voted to stay.

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Speaker 1: One last question all Americans wonder at all the time,

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Speaker 1: and that's the monarchy. You know a little bit about

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Speaker 1: the the monarchy. Take us forward. What is the role

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Speaker 1: if there is a role for the British, the British

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Speaker 1: of civilization, as it were, for the monarchy going forward

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Speaker 1: fifty years from now, will it be there?

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Speaker 2: I think so. But it's a unifying force and the

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Speaker 2: great thing that the Queen did, which she managed to

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Speaker 2: steer the monarchy through this period of enormous social and

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Speaker 2: economic and political change and still keep it as this cohesive,

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Speaker 2: you know, institution that allowed whatever other differences people have,

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Speaker 2: they came together around it. And King Charles, to be fair,

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Speaker 2: I think has got the same sense of public service,

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Speaker 2: the same commitment to the institution of the monarchy, and

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Speaker 2: I think from my generation and younger, you know, it's

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Speaker 2: a less deferential world that we live in. But our

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Speaker 2: preference is to have the monarchy rather than an elected president.

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Speaker 2: So I think it will stay. I hope it does.

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Speaker 1: That is perfect. That is great, Tony. Thank you so

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Speaker 1: much for you It's busy