Inward Investment in a Cold Climate

Abstract

A visitor touring in South Wales, by train or car, is quickly confronted by Wales' most easterly town, Newport. When arriving at Newport, the visitor passes one of the three integrated steel works of Corus Group (formerly British Steel). As the train leaves Newport, a huge new electronics complex looms, owned by LG, the Korean electronics combine. The fate of these plants represents a rather unique British manufacturing crisis. It seemed like the steel plant had won a reprieve from closure, but its longer-term future is now bleak. The LG complex, meanwhile, is an embarrassing white elephant. Built with enormous government subsidy it has been the source of national (Welsh) and national (UK) controversy over the levels of subsidy and the opportunity costs. While one plant in the complex, producing computer monitors, is up and running, the majority of the complex built to house semi-conductor manufacture has never been used. Moreover, with LG's semi-conductor interests worldwide being taken over by Hyundai (which has a similar plant lying idle in Scotland), utilisation of the plant in the near future seems a distant prospect.