We must hope that heavyweight observers like Japan raise their voices even more, writes Joe Gill
We must hopethat heavyweightobservers likeJapan raise theirvoices even more
Sometimes it takes an external party to provide a clear and unambiguous analysis on a subject causing material stress.
For months, now, we have had salvos of ever increasing vitriol being fired on both sides of the Brexit debate.
Those in favour have adopted an ever more menacing tone, with the latest chapter being a questioning of integrity within the British civil service.
Those against Brexit are resorting to shrill attacks on the personalities that dominate the wing of the Conservative Party that want out of the EU.
Amid this turmoil, a measured and rational voice has entered the fray. It comes from a powerful nation that has industrial might but adopts a highly diplomatic stance when opining on international matters.
That voice is the government of Japan, supported by its enormous and highly advanced corporate class.
The Japanese ambassador to Britain says that future investment in Britain hinged on the ability of that capital to generate a profitable return.
This may appear a simple and logical observation but it carries a potent message. If the UK creates an environment that in any way limits the ability of Japanese companies to freely trade across the European marketplace, then long term heavy investment programmes could be directed elsewhere.
The car manufacturing industry is where the rubber hits the road on this issue. It was Japanese companies like Nissan that effectively revived the UK car industry by committing billions of pounds to re-engineer manufacturing facilities.
These companies laid down deep multi-year investments in factories to deploy advanced robotic and supply chain assets that helped produce highly efficient and price competitive automobiles.
These Japanese companies did so with an implicit and explicit understanding that Britain would be at the heart of the largest consumer market on the planet — the EU.
The UK, and its politicians, were delighted to roll out the red carpet for Japan’s car companies at a time when few others showed an interest.
Moreover, that commitment happened while the indigenous UK car industry was imploding amid labour strife and low levels of sustained investment.
This car industry saga is a replica of what is happening across industries in Britain at present.
Large global financial services companies that trusted Britain to stay inside the customs unions are already planning and enacting long-term investments elsewhere in Europe.
Large industrial manufacturers like Airbus are making not so subtle noises about future investments being threatened by Brexit.
If Britain contained and controlled global corporations that had the breadth and depth of companies such as Nissan, JP Morgan and Airbus, these issues might be less troublesome.
Highly competitive international companies led by the UK might have some chance of navigating the trade barriers that are looming from Brexit.
Yet, the hard facts show that Britain no longer has many corporations like that. And if the leading global companies switch investment out of Britain, who will backfill in their place?
State-controlled entities of importance are not very visible and, anyway, the UK exchequer finances are already stretched.
That limits the ability of the UK Government to offset the vacuum left by departing private sector employers.
In one way, it is tempting for us in Ireland to smirk at all this, particularly as a flow of foreign investment connected to Brexit is surfacing within the Republic. But that would be a myopic and selfish attitude.
Instead, we must hope that heavyweight observers like Japan, who cannot be accused by Brexiteers of being in some conspiracy with the EU, raise their voices even more.
Britain is at risk of running down a rabbit hole of Alice in Wonderland proportions unless the common sense that usually defines that nation’s character makes itself heard very loudly, and soon.
Joe Gill is director of corporate broking with Goodbody Stockbrokers. His views are personal.
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