Guests Ian Robertson, Vera Wei, and David Landsman discuss the attractiveness of the UK for foreign investment, the impact of Brexit, educational travel, foreign-owned companies, the resurgence of the British car industry, BMW's investment in the UK despite Brexit, and the decline in foreign direct investment in the UK.
Foreign investment in the UK has been driven by encouragement of immigrant businesses and has been a crucial part of the country's business model, with companies like BMW and Tata making significant investments.
Foreign companies like BMW and Tata have reshaped the UK business landscape by bringing a different mindset, culture, and business practices, while leveraging the UK's strengths in research and development, talent pools, and a supportive business environment.
Deep dives
Foreign Investment in the UK: Drivers and Brexit Impact
Foreign investment in the UK has been driven by the country's encouragement of immigrant businesses, creating jobs and boosting productivity. Inward investment has been a crucial part of the UK's business model, with foreign companies like BMW, Tata, and others making significant investments. For BMW, owning Rolls-Royce and Mini and establishing a large engine factory has led to direct and indirect employment of 8,000 and 25,000 people respectively. Vera Wei's educational travel company, Sloan Education, has capitalized on the demand for UK education from Chinese students, requiring local knowledge and contacts to match them with UK schools. Tata's diverse business interests, including TCS and Jaguar Land Rover, demonstrate their long-term commitment to UK operations. Brexit introduces uncertainty, deterring investment due to concerns about tariff and customs issues, but the UK's strengths like language, education, and skilled workforce still hold appeal.
Foreign Companies' Impact on the UK Business Landscape
Foreign companies like BMW and Tata have reshaped the UK business landscape through a different mindset, culture, and business practices. In the case of the British car industry, the arrival of Japanese plants like Nissan brought a fresh approach, making productive cars with a new workforce. Working for a foreign company in the UK offered a competitive, global industry experience. Vera Wei's Sloan Education leverages the UK's reputation for top-tier boarding schools, English language education, and rich cultural heritage to meet the demand of Chinese parents seeking quality education for their children. Tata's long-term investment and commitment in diverse sectors like steel, IT services, and engineering leverages the UK's strengths in research and development, talent pools, and a supportive business environment.
Brexit's Impact on Foreign Investment: The Uncertainty Factor
Brexit poses challenges of uncertainty for foreign investment in the UK. The unpredictability hampers business planning in a global supply chain environment. BMW's investment in an electric Mini in Oxford factors long-standing sales volume, skilled workforce, and natural currency hedging into their decision, but uncertainty remains regarding customs issues and disruption to supply chains. For the education sector, Brexit raises concerns about ease of doing business due to bureaucracy, but the UK's reputation as a provider of quality education and the English language remain attractive to Chinese students. Tata emphasizes that the impact of Brexit varies across sectors and is not a one-size-fits-all scenario, with companies considering opportunities and mitigating risks based on specific circumstances. Overall, clarity and resolution on Brexit are necessary to instill confidence and generate investment decisions.
What makes the UK an attractive place for foreign companies to invest in? Britain has tended to enjoy high levels of inward investment thanks to its open economy. How might this change when the UK leaves the EU?
Evan Davis and guests explore the topic.
Joining Evan Davis are:
Ian Robertson, Global Head of BMW sales and marketing
Vera Wei, Chief Executive of Sloan Education
David Landsman, Executive Director of Tata Limited.
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