Industry is always having it's hand out, not just for Government incentives/investments like the current £500m for conversion to electric arc furnaces, but also in low corporation tax rates such as those in Ireland to attract HO locations, that most likely quickly disappear and relocate elsewhere when ever their low tax rates disappear.
Globalisation and the free movement of capital across borders ensures no country has a guarantee of continuity of an given industry base within their borders (except on the grounds of nation security) and even that can be circumvented. So its often the case that many governments are not masters of their own destiny when it comes to maintaining/retaining an economic base within their borders. The UK is not unique in this ,Germany is now experiencing more of its industrial base is moving or threatening to move overseas to lower cost bases and so the federal government is looking at all sorts of incentives/rebates to keep eg heavy energy consumers like glass industries to remain in Germany since the loss of access to cheap Russian gas,. because their global competitiveness has been undermined. A reliance for the most part created by the German government closing its nuclear power stations almost overnight.
Foreign ownership of a manufacturing company is not a great issue IMHO, its more important to have the wealth generation in form of local employment, supply chains and taxes etc paid domestically. The UK major motor manufacturers have been foreign owned almost from the outset eg Ford and Vauxhall by USA. Paying UK earned dividends abroad is a small price to pay, by comparison a major element of the UK corporate declared profits and resultant UK taxes paid are made on overseas earnings. Oversea ownership of manufacturing entities is not as big an issue as for service industries where wealth is created in one country and then thru licencing agreements/transfer pricing, the profits are taxed in low corporation tax areas like Ireland to the detriment of the wealth generating country.
Last edited by JohnHarris; 21/09/23 04:16 PM.
