Brexit: Nissan deal 'won't persuade other companies to invest in UK’

Investment will decline in the wake of the referendum result, warns man who brought Nissan to Britain

Nissan’s decision to build new cars in Britain will not be enough to persuade other businesses to remain in the country following the Brexit vote, one of Japan’s top business strategists has said.

The car manufacturer announced last week it would build two new models at its Sunderland plant, following government “support and assurances”.

Prime Minister Theresa May said the announcement was “fantastic news”, adding: “This vote of confidence shows Britain is open for business.”

But Kenichi Ohmae said investment in Britain will decline in the wake of the referendum result and said he is advising companies to hold fire on similar decisions.

In an interview with BBC Newsnight, Mr Ohmae said the deal between Nissan and the Government was a “minor decision” involving one company.

“I don't think other companies will follow suit,” he added.

Mr Ohmae advised Nissan to set up its main European plant in the UK in the early 1980s.

The warning comes after Business Secretary Greg Clark resisted calls to reveal the details of the Government’s agreements with the Japanese car giant Nissan following last week's announcement that the company will build the new Qashqai and the X-Trail SUV models at its plant in Sunderland, securing the future of 7,000 jobs.

It also follows alarm from Haruki Hayashi, the president of the Japanese Chamber of Commerce in the UK and chief executive of Mitsubishi in the EU, who urged Britain to give more than “general reassurances” to Japanese firms or risk putting investment decisions at risk.

In September, a Japanese government taskforce delivered a warning to the UK in a 15-page document entitled Japan’s Message to the United Kingdom and the European Union.

It said: “Uncertainty is a major concern for an economy; it evokes a sense of anxiety, causing volatility in markets, and results in the contraction of trade, investment and credit.”

“What Japanese businesses in Europe most wish to avoid is the situation in which that they are unable to discern clearly the way the Brexit negotiations are going, only grasping the whole picture at the last minute.”