Investment in jeopardy

Leading Far East companies are warning that the increasingly isolationist British stance on Europe over the BSE crisis could jeopardise further investment in the UK.

"Distribution is an important factor in the location of any manufacturing site, and the UK's relationship with mainland Europe may have a direct bearing on the extent of investment," cautioned Seigo Nishino, deputy chairman of Mitsubishi Electric.

Since coming to Britain in 1978, Mitsubishi Electric has invested pounds 75m in four factories producing colour televisions, video recorders and computers. More than half its output goes to other European Union countries.

Mitsubishi is just one of 215 Japanese companies that have set up in Britain to gain access to the EU market. The UK has been the number one choice, scooping 40 per cent of Japanese investment in the EU.

Electronics giant Fujitsu earmarked pounds 816m to expand its Newton Aycliffe plant in County Durham last September. "If the UK were to pull out of the EU that would have serious implications for a factory like this," said a spokesman. He added it would certainly put "a question mark" over further investment.

"All our production is exported with 95 per cent going to mainland Europe. We compete with non-EU located businesses to supply Drams (computer memory chips) in Europe," he said.

"If that market became difficult, the EU would erect tariff barriers. We would then be less competitive than we are now. Fujitsu would have to look seriously at any further investment if we were unable to compete."

A Nissan spokesman said: "If the EU changed the rules of engagement then this would become a problem Nissan would have to address." It is currently spending pounds 250m on converting an assembly line to build the new Primera car, and its UK investment has topped pounds 1.25bn.

Electronics giant Sony, which makes TVs and computer monitors from large plants in South Wales, sees any change to Britain's stance on Europe as "one of the criteria considered when looking at future investment". Some 85 per cent of its output is exported to other EU countries.

Other Far East-based corporate giants are thought to be concerned about UK investment plans. Two South Korean electronics companies, Lucky Goldstar and Daewoo Electronics, are thought to have put UK expansion plans on ice recently in case the beef crisis leads to a deeper rift between Britain and its EU partners.

Inward investment into the UK has been important for jobs. The Confederation of British Industry estimates that, since 1979, 700,000 jobs have been created as a result of direct investment by overseas companies.

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Selby Jennings: Oil Operations

Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...

The Jenrick Group: Night Shift Operations Manager

£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...

SThree: Trainee Recruitment Consultant - LONDON

£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Day In a Page

Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect
Surrounded by high-rise flats is a little house filled with Lebanon’s history - clocks, rifles, frogmen’s uniforms and colonial helmets

Clocks, rifles, swords, frogmen’s uniforms

Surrounded by high-rise flats is a little house filled with Lebanon’s history
Return to Gaza: Four months on, the wounds left by Israel's bombardment have not yet healed

Four months after the bombardment, Gaza’s wounds are yet to heal

Kim Sengupta is reunited with a man whose plight mirrors the suffering of the Palestinian people
Gastric surgery: Is it really the answer to the UK's obesity epidemic?

Is gastric surgery really the answer to the UK's obesity epidemic?

Critics argue that it’s crazy to operate on healthy people just to stop them eating
Homeless Veterans appeal: Christmas charity auction Part 2 - now LIVE

Homeless Veterans appeal: Christmas charity auction

Bid on original art, or trips of a lifetime to Africa or the 'Corrie' set, and help Homeless Veterans
Pantomime rings the changes to welcome autistic theatre-goers

Autism-friendly theatre

Pantomime leads the pack in quest to welcome all
The week Hollywood got scared and had to grow up a bit

The week Hollywood got scared and had to grow up a bit

Sony suffered a chorus of disapproval after it withdrew 'The Interview', but it's not too late for it to take a stand, says Joan Smith
From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?

Panto dames: before and after

From Widow Twankey to Mother Goose, how do the men who play panto dames get themselves ready for the performance of a lifetime?
Thirties murder mystery novel is surprise runaway Christmas hit

Thirties murder mystery novel is surprise runaway Christmas hit

Booksellers say readers are turning away from dark modern thrillers and back to the golden age of crime writing
Anne-Marie Huby: 'Charities deserve the best,' says founder of JustGiving

Anne-Marie Huby: 'Charities deserve the best'

Ten million of us have used the JustGiving website to donate to good causes. Its co-founder says that being dynamic is as important as being kind
The botanist who hunts for giant trees at Kew Gardens

The man who hunts giants

A Kew Gardens botanist has found 25 new large tree species - and he's sure there are more out there