HC Deb 20 March 1991 vol 188 cc277-8
12. Mr. Harry Greenway

To ask the Secretary of State for Trade and Industry if he will estimate the number of firms established in the United Kingdom with foreign capital during the past year; how many jobs have resulted; and if he will make a statement.

Mr. Leigh

According to the figures recorded by the Invest in Britain bureau, 1990 was a very successful year for inward investment. There were 340 inward investment projects, which are expected to create 27,000 jobs and safeguard a further 34,000. That demonstrates the continuing confidence in the United Kingdom as a sound and stable economy for inward investment.

Mr. Greenway

Will my hon. Friend confirm that the United Kingdom attracted £46 billion worth of inward investment in 1988–89, three times as much as France and six times as much as Germany? Does not that confirm what he has said? The climate in the United Kingdom—particularly in Ealing—is just what is needed for inward investors and any other type of investor.

Mr. Leigh

This is an interesting question: why was inward investment so successful last year that 61,000 jobs were created? Why do investors want to come here? Why are we the No. 1 location? It is because we are an entrepreneurial, hassle-free business environment with the lowest corporation tax in not only the EEC but the G7 countries.

Mr. Hoyle

How many of these companies intend to undertake research and development in this country? Or are they building purely assembly plants? [Interruption.] Will the Minister listen, for a change? Is the Minister quite happy that we are being treated like a banana republic?

Mr. Leigh

The hon. Gentleman will have to put aside his Luddite attitudes just once when it comes to inward investment. As is evident in the north-east in particular, inward investment has raised quality. It is interesting that, although such companies account for only 2 per cent. of establishments, they account for a staggering 18 per cent. of net output. They have improved business attitudes and they account for more capital investment than do other companies. They are 50 per cent. more productive than British companies, although we have doubled productivity. Inward investment is good for British companies and for Britain.

Mr. Viggers

Does my hon. Friend agree that we have been outstandingly successful in winning investment from Japan? More than 1,000 Japanese companies have invested here—representing 40 per cent. of all the investment in the European Community. Does my hon. Friend agree that, to a considerable extent, that investment is predicated upon our membership of the Community, and that it is crucial, if we wish to win further inward investment, that we show complete commitment to achievement of the single European market?

Mr. Leigh

Yes.