The Rebirth of Northern Ireland : Despite Continuing Strife, Foreign Investment Is on Rise

From Reuters

Undaunted by bombs and bullets, multinationals are moving into Northern Ireland.

Planners hope for a new era in industrial development as U.S., Asian and European firms fill factories and invest in an economy bled by two decades of political and sectarian strife.

Some foreign businessmen might not want to work in a city where army patrols stop motorists, hotel security checks are common and bombs sometimes kill or maim unintended victims.

But others say fighting between Protestants and Catholics, in which nearly 3,000 people have died since the late 1960s, does not affect business and can be avoided. They cite some of the best financial packages and golf courses in Europe and a loyal work force desperate for jobs.

"Many foreigners have misconceptions about the place," said Eric Wachtel, head of U.S.-based Medphone Corp., who regularly visits Belfast on business.

In the year ending March, 1988, local and foreign firms created 5,300 new jobs in the province. Foreign investment commitments last year of 159 million pounds ($278 million) accounted for more than half of the total.

"There is an air of confidence which we haven't seen for years," said Tony Hopkins, chief executive of the state-linked Industrial Development Board.

Plant Closures Offset

Declining heavy manufacturing such as shipbuilding helped make Northern Ireland one of Britain's slowest-growing regions. Its overall male unemployment rate of 15.5%, which is closer to 70% in some deprived Catholic areas, is one of Britain's highest and double the rate for all of the United Kingdom.

New business activity helps offset the closure in recent years of plants owned by international firms such as London-based Imperial Chemical Industries PLC and French-based tire giant Michelin. Unions fear more job losses with the planned privatizations of state-owned shipbuilder Harland and Wolff and aircraft firm Short Brothers.

Business chiefs report expansion by some local and foreign firms and hope the announcement in December of the region's two biggest overseas investment projects will lure more contracts.

South Korea's Daewoo Electronics UK Ltd. is building an 18-million-pound ($31.5 million) video cassette recorder plant that will employ 500. French motor component manufacturer Montupet will invest 90 million pounds ($157.5 million) in an aluminum foundry near mainly Catholic West Belfast.

Montupet will create 1,000 new jobs to produce cylinder heads for Ford Zeta engines. The project is sited at the former plant of the DeLorean sports car venture, founded by U.S. entrepreneur John DeLorean, which crashed in 1982.

American, Asian Firms Courted

Daewoo and Montupet join more than 150 international firms with local subsidiaries. Among them are three Japanese and 25 U.S. companies, including Ford Motor Co. and Du Pont.

IDB is especially courting American and Asian firms eager to secure a European foothold in the approach to 1992, when the European Community integrated market comes into force. The government is optimistic, but admits that "the troubles" can put off some potential investors.

"The image of Northern Ireland as a difficult and violent place is the story of our lives," Northern Ireland Industry Minister Peter Viggers said recently in London. "We have to have people put aside their preconceptions."

He and others hope that investment will prove a strong tool to reduce tensions, by creating jobs for the frustrated poor and forcing Catholics and Protestants to work side by side. Foreign firms new to the region tend to be committed to fair employment.

The IDB has pulled out the stops and even has done up glossy brochures that stress the area's top-notch fishing, golf and schools. It also hope to lure companies with cheap labor and overheads, a strong local work ethic and a wide range of rent, building and interest relief grants.

Visiting reporters and businessmen are shown sleek new technology parks and fine restaurants in sedate suburbs far from the boarded-up and bullet-ridden ghetto buildings.

The sales pitch has attracted a new wave of software and electronics firms drawn by the area's high number of engineering graduates and skilled workers and growing youthful labor force. Nowhere is renewal more obvious than Belfast city center, once almost deserted at nights during an IRA bomb campaign against pubs and shops.

With the end of that drive several years ago, frisking at some stores stopped and retail chains have returned. In the past three years alone, 200 new restaurants have opened, said William Pinkerton of the Northern Ireland Environment Department.

The main shopping street of Victorian buildings could be anywhere in Britain. Busy consumers browse in malls, ignoring a spot nearby where a young Catholic was shot hours earlier.

Citadel-like gates around the central shopping area, erected to prevent car bombs, have actually aided urban renewal. "We've got very elegant pedestrian malls now," Pinkerton said.

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