Investment in the Continental EEC (CEEC) as opposed to investment in the UK
July 29th, 1976
Systems Technology Group paper, ICI Europa
S F Bush
Introduction
No general case can be made covering all types of investment. Most, of not all, of ICI’s investment in the last 10 years has gone into maintaining rather than expanding the size of its profits in real terms (even in 1974, see Appendix).
The most powerful argument for continuing to invest in the CEEC is to maintain the value of the existing assets represented by a trained work force and developed sites. This would set the future investment split between the UK and the CEEC as broadly equal to the existing split.
On its own, the argument of proximity to the market is hardly borne out by experience, i.e. exports from the UK have been consistently more profitable than local manufacture. The interface the customer presumably needs is an effective locally based technical service and it should not be necessary to build a plant to achieve this.
In more detail, some arguments for and against, seen from a UK point of view, can be set out.