Multinationals - The takeover of Britain
WORKERS, SEPT 2007 ISSUE
Do foreign multinationals promote British firms? New research shows that attracting foreign investment and foreign companies actually tends to stifle promising indigenous firms.
Britain is the largest recipient of foreign direct investment in Europe and second only to the USA worldwide. In 2006, it attracted record levels of foreign investment (the fourth year running that the record has been broken) and 1,431 investment firms came to Britain. In 1998, 12 per cent of our jobs were in foreign-owned firms. By 2002, this share rose to 17 per cent, a 42 per cent rise.
The researchers, from Nottingham University, found that in sectors of the economy where companies compete on the innovation of products or services, the likelihood of failure increases substantially as a result of competition from multinationals locating in Britain.
The research is based on data from 179,000 start-up businesses between 1997 and 2002, compiled by the Inter-Departmental Business Register held at the Office for National Statistics.