The German-Owned Manufacturing Sector in the North-East of England

The north-east of England is one of the most successful regions in attracting foreign investment in the UK-Germany being the most important European investor. This article seeks to provide a detailed account of the underlying motives and linkage effects of German direct investment in the manufacturi...

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Bibliographic Details
Published in:European planning studies 2000-10, Vol.8 (5), p.601-617
Main Author: Kirchner, Peter
Format: Article
Language:English
Subjects:
Capital expenditures
Economic development
Economic impact
Foreign investment
Industrial policy
Manufacturing
Questionnaires
Semiconductors
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Summary:The north-east of England is one of the most successful regions in attracting foreign investment in the UK-Germany being the most important European investor. This article seeks to provide a detailed account of the underlying motives and linkage effects of German direct investment in the manufacturing sector in the north-east of England. The study of 19 of the 29 German-owned manufacturing companies found that market-orientation was by far the most important pull-factor. The direct effects in terms of associated jobs and capital spending created a solid and persistent structure with six companies even expanding. However, to be more beneficial to the restructuring of the regional economy the existing linkages of the German-owned manufacturing sector have to be consolidated and additional networks built up. A separate discussion of the rise and fall of the Siemens semiconductor plant at Wallsend reveals the volatility of flagship investments and stresses the need for a regional industrial policy combining Foreign Direct Investment (FDI) with endogenous economic development.
ISSN:0965-4313
1469-5944
DOI:10.1080/713666426