SYMPATHY WITH HISPANIC COUNTRIES DURING RECESSION

I would like to express particular sympathy for Spain and several other Hispanic countries with the news of Spanish companies being nationalised in South America. I sympathise with Spain, in the sense that the country has already been suffering due to the economic crisis, so it could do without its lucrative overseas businesses being seized and nationalised at this difficult time. Having said this, I can sympathise with Argentina (Falklands aside) and Bolivia in wanting to nationalise these companies, following a similar train of thought as my last post. It is understandable that a country would rather have control of, and keep profits from, its own resources. However, I can foresee a negative consequence of this being that international companies may fear making further investments in South America, due to the greater risk that their investments may similarly be lost because they are nationalised. Though it is better for countries to produce their own wealth, at times of difficulty all income is valuable- and overseas investment in your country is one of them.

ONGOING SALES OF BRITISH BUSINESSES

News today of the sale of the British cereal company Weetabix to Chinese company Bright Food marks yet another sale of a successful, long-established British company being sold off to international companies. Whilst in the short-term it demonstrates an interest in, and the value of, the British economy; in the long-term it can have several negative effects. When owned by a company outside of the UK, the is arguably a greater risk that operations could be completely removed from the UK- jeopardising hundreds of British jobs for certain communities. It also dwindles the impact the British government can have on the company so that it assists national interests, and in cultural terms also represents a loss for the country. Weetabix is the latest of many companies to be sold off, including Abbey National (now owned by a Spanish company), Cadbury (now owned by an American company) and EMI record company (also now owned by an American company.