Shunning euro will harm UK, say top firms

Survey of leading foreign industrialists holds stark message for Blair

By Andy McSmith
Thursday 19 December 2013 05:09

Some of the most important participants in the argument over whether Britain should join the euro are foreign businessmen. Eurosceptics have argued on patriotic grounds that people such as the Irish chairman of Unilever, Niall FitzGerald, or a German or Japanese car manufacturer should not be able to influence a decision of such immense importance to Britain's future.

But it is worth remembering that these people have a vast influence over the lives of thousands of Britons anyway, because they have the power to decide whether to invest in the UK or elsewhere. And investment means jobs.

As time runs out for Tony Blair and Gordon Brown to arrive at an agreement on the euro, the Britain in Europe campaign has compiled a list of comments by leading industrialists around the world, from newspapers, interviews and trade magazines, to support their claim that staying out is not a cost-free option.

Jean-Martin Folz, chief executive of PSA Peugeot Citroen, the French motor manufacturer which has 5,300 UK employees, said: "Non-membership of the euro is not positive if you want to manufacture in the UK ... "

Herman Scholl, chairman of Bosch UK, a German engineering firm with 4,600 UK employees, said: "The pound is a huge problem. I would like to see Britain enter the single currency as soon as possible."

Paul Barron, president of Alstom UK, a French engineering firm with 14,000 UK employees, said: "If we don't go into the euro, I will recommend that we move 50 per cent of our manufacturing out of the UK and we'll put it in France or Germany."

Dr Shuhei Toyoda, president of Toyota Europe, ruled out expanding its Burnaston factory due to "the euro problem".

Keith Tipping, UK managing director of Japanese construction firm Komatsu, with over 500 UK employees, said: "The strength of the pound makes it difficult to trade overseas for a company like ours."

Niall FitzGerald, chairman of Unilever, a household products manufacturer with 12,500 UK employees, said a decision not to hold a referendum "would force us to examine carefully whether the UK continued to be the appropriate place in which to locate manufacturing for the 50 per cent of our market which is in Europe."

Sir Nick Scheele, president and chief operating officer of the US motor company Ford, said: "Britain is important to Ford. But being outside the euro presents a growing threat to our ability to function from a British base."

Kunio Nakamura, president of Matsushita Electrical Industrial, an electronics firm, said: "Relocation is a possibility, if the UK makes no effort to resolve the [currency] problem."

Max Dietrich Kley, deputy chairman of BASF, a chemicals and plastics manufacturer, warned that investment at the company's plant had been held back "by the currency problem" and that when it came to big investment decisions, BASF sites in Belgium and Spain tended to get the nod because investing "within euroland is more attractive".

Alan Wood, chief executive of German engineering firm Siemens UK, which has 16,000 UK employees, said: "Looked at over a 10-year time scale, a significant part [of Siemens UK operations] will become less viable unless Britain joins the euro. Euro entry is crucial if the UK wants to make the most of its industrial potential."

Denis Ranque, chairman and chief executive of Thales, an offshore surveying company, said: "It [joining the euro] would make our life much easier and encourage us to invest even more in the UK."

Chris O'Donnell, chief executive of medical instruments manufacturers Smith & Nephew, said: "[We] might start asking where we would want our business to be based. If there was no way we were going to join the euro or if entry was delayed for too long we would have to take a very hard look at that. I think Britain has to be in the euro, although we need to be very careful that we don't disadvantage ourselves by going in at the wrong exchange rate."

Kevin Wale, managing director of car manufacturers Vauxhall Motors, which has 8,400 UK employees, said: "The euro is a factor in a lot of investment decisions. When you are competing against car-makers in other countries you do not need extra obstacles put in your path."

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