Slump forces rethink for Scottish investment policy

Development agency Scottish Enterprise is to move away from policies which have left Scotland dependent on large single inward investments to concentrate on indigenous growth and higher value jobs. Last week Fujitsu followed Samsung, Hyundai and Siemens by mothballing its semiconductor plant in the north-east of England, with the loss of 600 jobs. A further […]

Development agency Scottish Enterprise is to move away from policies which have left Scotland dependent on large single inward investments to concentrate on indigenous growth and higher value jobs.

Last week Fujitsu followed Samsung, Hyundai and Siemens by mothballing its semiconductor plant in the north-east of England, with the loss of 600 jobs.

A further 1,300 jobs went in the Scottish electronics sector when Viasystems of the US shut its plant in the Borders and Motorola cut 300 jobs at its East Kilbride semiconductor plant.

These have largely been the result of the slump in the market for memory chips, combined with the Asian financial crisis.

Neil Martin, head of semiconductors at Scottish Enterprise, said the agency would seek a more active role in discussing corporate strategy with large multi-national investors. The new ‘clusters’ approach would help to build strong micro-economies in semiconductors and Scotland’s other principal industries.

This started with the announcement of the Alba semiconductor design centre in Livingston. It will create 1,800 high-value jobs when US company Cadence sets up a chip design facility.

* It is still not clear how the merger of the semiconductor businesses of Korea’s LG and Hyundai will affect planned UK investments.

LG Semicon’s £1.2bn semiconductor plant at Newport, South Wales, is due to open next year. Hyundai has already postponed its Dunfermline semiconductor plant.