U.S. Too Slow in Grabbing European Markets, Expert Says
Lord Cockfield, a former British Cabinet minister and architect of the planned economic unification of Western Europe in 1992, said U.S. companies are not moving fast enough to capitalize on emerging markets in the European Economic Community.
“The window of opportunity for American companies is narrowing quickly as 1992 nears,” Cockfield said in an interview Wednesday. “While Japanese investments in the European Community have substantially increased in the last four years, many of which have been in high technology, the growth of American investment has been slow.”
In the last two years alone, Japan’s direct investment in the EEC tripled, from $9.1 billion in 1988 to $30 billion last year. U.S. investment, although larger than Japan’s, has not shown any growth from about $126 billion in 1988, according to Aidan St. P. Walsh, the international director of KPMG Peat Marwick, the New York-based international accounting firm.
“Unless you act quickly,” he said, “you’ll find your competitor sitting on your doorstep” because European Community companies are also expanding rapidly in the international market, particularly in the United States.
Cockfield made his remarks in an interview before a speech at the World Trade Center Assn.’s annual dinner meeting Wednesday night.
One area that Orange County companies can still capitalize on is Western Europe’s booming information technology market, he said. While the EEC accounts for 30% of the world market in information technology, EEC companies have been able to supply only 11% of the market, he said.
Cockfield developed plans for the European Community’s economic unification while serving as vice president of the European Communities Commission. He is an expert on how economic and political policies coming out of the European Parliament in Brussels will affect the international market. Since leaving the EC Commission in 1988, he has been a special adviser to KPMG Peat Marwick McLintock, the U.K. affiliate of the accounting firm.
Cockfield said he sees “no prospect” of the newly liberalized East European countries joining the EEC.
He said U.S. companies trading with Eastern Europe should plan investments there separately from their involvement in Western Europe.
