by Malcolm Hyde Regional director CBI South East

Times are tough. The big question is where we take things from here.

We're not helped by external forces. I won't discuss the Eurozone crisis because it's probably had a new setback in the time between me writing this piece and you ready it.

Instead I'll share with you my thoughts on economic rebalancing - what I think it means; the role manufacturing has in it, and how a new type of industrial activism could help breed home-grown success stories.

It's not a rebalancing act that should mean some sectors shrink.

Yes, we want a strong City of London but it needs to play a less dominant role in the overall economic mix. If not, we run the same risk of over-dependence that we did in the run-up to the financial crisis.

And rebalancing shouldn't mean trying to engineer a wholesale shift of economic activity away from services and towards manufacturing.

Our traditional strengths in services need to be built on, be it in finance, professional and business services, the creative industries, retail or tourism.

Services growth helps manufacturing, and we shouldn't draw an artificial distinction between the two.

Most manufacturers provide services, whether delivering and installing what they've made or being involved with performance management and consultancy.

Logistics, design and finance are part of manufacturing just as they are part of services - and they're British strengths.

The UK is still one of the world's top-ten manufacturers.

But our future lies in mixing traditional strengths with innovation, R&D and advances in hi-tech and low-carbon.

What's needed is a new form of industrial policy, one that signals ambition, helps develop future capabilities and secures sustainable growth... and this doesn't mean revisiting the 1970s industrial landscape of Red Robbo!

A new understanding needs to run through all of government with all departments sharing the same ambition.

They all need to work to join up policies and create a system that's more than the sum of its parts.

They need to create an environment that will give investors the confidence to put their money into growth here in the UK and not abroad.

By taking the right actions, we'll encourage investment, boost industry and help that process of rebalancing away from debt and towards sustainable growth and an export-led recovery.

Positive thoughts that accompany my very best wishes to you all for the year ahead.