cu cbs inward investment v9
TRANSCRIPT
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cardiffinvolved
communication
businesses
targets
culture
PeoPle
Policy
Place
work
government
one
PeoPle
wales
caPital
skill
aPProach
services
welsh
exPerience
resources
interaction
Performance
brand
inward
investment
marketing
shared
different
activities
oPPortunities
coordination
cardiffbusinessschool
cardiffbusinessPartnershiP
cardiff
discussions
selling
wales:
the role of agencies
in attracting inward
investment
comPetition
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This study set out to explore how the
agencies which promote inward investment
operate in Wales, with a particular ocus on
Cardi. The research involved ace-to-ace,
semi-structured interviews, ocusing on the
workings o the agencies. This inormation
was supplemented with questionnaires sentto frms and to politicians who were unable
to take part in ace-to-ace interviews.
The research highlighted a number
o problems in terms o structure and
organisation across the agencies within the
Cardi city region.
It appears that there is some consensus on
what is wrong and what needs to change but
that there has been little clear action to date.
The number o agencies involved in attracting
inward investment in the region creates a
complex picture. One agencys work naturally
overlaps with another. This report shows,
however, that there is a lack o coordination in
the promotion o services. Although some o
the agencies have wider remits than others,
and some do work closely together, there
needs to be more structured coordination to
better use resources.
1. working between agencies:there is a lacko coordination between dierent agencies.Competition between some agencies creates
unhealthy eects.
2. the brand: the perception amongststa o diering messages within the same
geographical area has resulted in conusion over
who does what and where remits o certainagencies cease and others begin. There is also
the danger o sending conusing or conictingmessages to potential investors.
3. limited resources: in some agencies, limitedbudgets prevent large scale strategic marketing
and result in shorter, one-o campaigns. Thistargeting, particularly in terms o sectors, has
some advantages but results in uncertainty in
what to do with potential investments rom
outside key sectors.
4. imPetus for change:there is evidence osome coordination between public and privatepartners in promoting Wales as a destination or
inward investment but there is acknowledgmentthat some aspects o the process need to
change and that improvements can be made.
Recommendations
development of a stRongeR
Welsh BRand:both Cardi and Wales wouldbenet rom a stronger and more coherentbrand image which is supported by all agencies
and allows a greater coordination o the use o
resources.
impRoved cooRdination:there needs to be aclearer remit or individual agencies but also an
improved structure whereby joint projects canbe executed and contacts shared.
consistency in policy Beyond taRget
sectoRs: the Welsh Government needs to
develop a consistent policy, supported by all
agencies, regarding attraction o investment
rom outside key sectors. This is about improvingresponsiveness to enquiries made by rms
which do not t into sector teams.
executive summary
selling Wales: the role of agencies in attracting inward investment2
key
findings
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Cardiff Business sChool and Cardiff Business PartnershiP
contents
3Cardiff Business sChool and Cardiff Business PartnershiP
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background: fdi attraction in wales
the research
findings
interaCtion Between agenCies
ComPetition Between agenCies
marketing of wales/Cardiff
misCommuniCation
the Case of sCotland
conclusions
recommendations
references
annex
r&d
aggregate numBer for fdi inflows
introduction 4
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selling Wales: the role of agencies in attracting inward investment4
This report assesses the agencies (and attendant
inrastructure) charged with attracting inward
investment in the Cardi City Region. Since theamalgamation o the Welsh Development Agency
(WDA) with the Welsh Assembly Government
(now the Welsh Government) in 2006 there hasbeen a uid support structure. This report aims to
understand the role o dierent inward investmentagencies, how they work and how they interact.
The study was carried out by conducting in-depth,semi-structured interviews with those working in
agencies, the Welsh Government and companies.
Questionnaire and secondary data were alsoevaluated. This report presents a picture o the
structures based on the experience o those doing
the job rather than the ormal organisational
structure. While the goal o this work is not topresent a trend analysis o global Foreign Direct
Investment ows, some background data on the
region are included to give a representation o itscurrent inward investment perormance.
The work was carried out by Cardi Business
School on behal o the Cardi Business Partnershipduring May 2011 to October 2011. All interviews
were condential to ensure that respondents elt
comortable giving their honest opinions on thecurrent structures and practices.
Attracting inward investment is one objective o an
economic development authority. New rms entering a
region create economic churn; this rejuvenates ideas andbrings much needed capital to local rms. How this task is
undertaken by governments, agencies, and/or individuals
is not a precise science and the academic or policyliterature reports little consensus on the correct approach.
From an inward investment promotion perspective, Wales
has undergone a marked change in the last decade. In2006 the Welsh Development Agency (WDA) merged
with the Welsh Government: this merger led to the
retirement o the WDA brand and the introduction o aWelsh Assembly Government (now Welsh Government)
brand or inward investment, International Business Wales
(IBW). Since this date a number o agencies, which had
been operating during the time o the WDA, have takena greater role in attracting inward investment, particularly
rom the rest o the UK and Europe. It must be noted
that other agencies were involved in inward investmentattraction during the time o the WDA, but were very much
in supporting roles. The Welsh economy, in the 1990s andearly 2000s, was seen as a major player in the European
regional development arena, attracting 15% o all oreigninvestment coming into the UK during the early 1990s1.
The high prole Oxord Intelligence report is compiledeach year on a given sectors investment strategies. In
2011, a study o biotechnology, pharmaceutical and
medical technology companies worldwide examined
the role o economic development agencies in assistinginvestment. The studys credibility is not in doubt with in-
depth company interviews carried out at Chie Executive
Ofcer, Chie Financial Ofcer and Senior Vice President
level, providing the vital corporate view. A key ndingwas that even in 2011, the WDA was still the second most
recognised development agency brand in Europe, a quite
startling nding given its non-existence since 2006.
It is thereore important to evaluate how well Wales has
done in attracting inward investment since the closure othe WDA.
introduction
to the research
BaCkground:
inward investment
attraCtion in wales
1 tt://.ts.mt.k//m201011/mst/m/t//15.tm
selling Wales: the role of agencies in attracting inward investment4
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5Cardiff Business sChool and Cardiff Business PartnershiP
wales and the uk in the inward investment game
table 1: Percentage of uk inward investment Projects** won(excluding london)*Source: uKTi and Fdi MarKeTS FroM The Financial TiMeS** ThiS iS new inveSTMenTS.
5Cardiff Business sChool and Cardiff Business PartnershiP
Welsh and global inward investment
ows have seen a steep downturn
over the last decade. What has beendisappointing or Wales is that there
appears to have been a continuous all
in levels since 2003. There is a urtherconcern or Wales; this is the improving
perormance o other regions in the UK,particularly Scotland, whose activity
during the late 90s was ar below Wales'but has now improved to lead the UK
(outside London).
I the gures are considered in terms
o overall inward investment projects
won, Scotland has become the number
one ranked region in the UK (excludingLondon). At the same time Wales has
gone rom number two in the UK in
2003 to second rom bottom in 2010.Table 1 shows Welsh perormance
compared to all regions.
Some background needs to be givenwhen contrasting the perormance
o Wales with other regions. Figures
published by the Welsh AssemblyGovernment (WAG 2010) suggest
that the number o "oreign owned
enterprises active in Wales" is smaller
than that in any English region. Therewere around 1000 in 2007, rising to 1100
in 2009 and alling back to 1000 in 2010.
They employed around 139,000 people
in 2010, 11,000 ewer than in the peakyear, 2009.
2003-04
2005-10
av % 8.5
av % 9
rank1
rank1-
scotland
2003-04
2005-10
av % 3
av % 3.3
rank6
rank10g
south west
2003-04
2005-10
av % 2.5
av % 3.7
rank8
rank7i
east anglia
2003-04
2005-10
av% 4.5
av% 5
rank4
rank3i
west midlands
2003-04
2005-10
av % 7.5
av % 3.5
rank2
rank9g
wales
2003-04
2005-10
av% 6.5
av% 6.8
rank3
rank2i
north west 2003-04
2005-10
av % 3.5
av % 3.7
rank6
rank5i
north east
2003-04
2005-10
av% 2
av% 3.7
rank9
rank6i
yorkshire & humber
2003-04
2005-10
av % 3.5
av % 3.5
rank8
rank8-
east midlands
2003-04
2005-10
av % 4
av % 4.3
rank5
rank4i
northern ireland
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selling Wales: the role of agencies in attracting inward investment6
The aim o the analysis was to
interview key personnel rom
all the agencies involved ininward investment attraction
to the Cardi city region.
It became clear that there
is a delineation o controland activity. Thereore the
interviews needed to be
undertaken across agenciesat dierent spatial levels in
order to establish why certaintasks were taking place. Table
2 gives a prole summary othe respondents involved and
Figure 1 shows the relationship
between the agenciesoperating within the Cardi
city region.
the research
selling Wales: the role of agencies in attracting inward investment6
15
12
6
5
key Point
method
lack of communication
interview
Practitioner*
key Point
method
misinformation
interview / Questionnaire
firm
key Point
method
consistency in communication
interview / Questionnaire
government / council
key Point
method
lack of resource
interview
Policy imPlementation*
welsh government
ukti
ibw cardiff and codePartment of economy
and transPortcaPital wales
cardiff council
table 2: Profile of resPondents
*SoMe oF TheSe reSpondenTS are no longer worKing in The agencieS, buT were in ThoSe roleS
during The period (2004-2011).
Figure 1: agency STrucTure
* agencieS have been coded a-g For The purpoSeS oF conFidenTialiTy
** arrowS repreSenT coMMunicaTion FlowS idenTiFied by reSpondenTS.
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7Cardiff Business sChool and Cardiff Business PartnershiP
attraCtinginward investment
ComPetitionamongst agenCies
Since the 1960s and the true advent o globalised
multinationals, there has been critical debateamongst scholars and practitioners alike on
how best to attract inward investment. During
the early 90s, Europe saw vast numbers o rmsmoving into nations to take advantage o the
growing wealth o the trading bloc. The impacto inward investment on local economies has
been studied in some depth with the notableworks o Hill and Munday (1992), Blomstrom
et al (2000) and Drifeld (1999) identiying the
impact o rm spillovers on local development.With these advantages o inward investment
accepted by politicians, many governments
concerned themselves with developing inward
investment riendly policies. During the early 90s,rms location decisions appeared to be driven
purely by economic actors, with winning regions
oering the lowest possible cost base throughboth tax incentives and grant schemes (Bellak and
Leibrecht, 2005).
During the early 90s Wales was seen as a highlysuccessul region in attracting inward investment
- its low cost base and English speaking work
orce were seen as critical actors in its success(Cooke and Morgan, 1998). As relative operating
costs began to rise the rms once ocking to the
country began to leave. They were drawn rst to
Eastern Europe. Over the last decade, the growtho China and India as power houses o low cost
business has meant developed regions in Europe
have had to compete even harder to attract rms.
Today, policies to attract inward investment intodeveloped nations vary by locality yet there are
some common practices identied by Guimon
(2009) with a strong ocus on highly skilled workorces and local amenities. As a result, it has
been accepted that marketing o place plays
an important role in attracting investment indeveloped nations, over and above tax incentives.
With large numbers o regions and countries all competing or inward
investment, intense competition has arisen between agencies. With somuch to gain, pressure has been put on governments (and economies)
to be as competitive as possible. This pressure is a double edged sword as
although it can lead to efciency and productivity improvements, too muchpressure can generate a so called race to the bottom. Here nations trying
to reduce wage bills and oering more competitive (expensive) packageso support can eectively produce poor welare outcomes. Charlton (2003)
provides a useul ramework to understand this competition or inwardinvestment.
The matrix describes the associated consequences o dierent types o
inward investment strategy. For example, i a region attempts to take an
investment rom where it is naturally more efcient, the overall economywill suer while a smaller area may benet (top let corner). Although the
original matrix allows comparisons between regions it is also possible to use
it to analyse investments within the same region. I one agency attemptsto oer incentives over and above another agency, the result is a loss o
overall welare o the region (bottom let corner). This competitive analysis
o inward investment suggests that while some competition is healthy, toomuch can create substantial welare losses.
7Cardiff Business sChool and Cardiff Business PartnershiP
investment Poaching
domestiC welfare gain?
international welfare
loss?
healthy comPetition
domestiC welfare gain?
international welfare
gain?
beggar thy neighbour
domestiC welfare loss?
international welfare
loss?
winners curse
domestiC welfare loss?
international welfare
gain?
Figure 3: charlTon'S FraMeworK
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9Cardiff Business sChool and Cardiff Business PartnershiP
PerCePtion of ComPetition Between agenCies: Cardiff vs wales
In some cases we are encouraged to passover the es o contacts to agency B, thisis done as they are seen as the strongerand have more resources and experience.The probem is that rms do not want
that, they just want one port o ca or adeaings, switching between agencies doesnothing except conuse those invoved.
We need to make ourseves visibe and
I mean visibe in every sense o the word,we need to be so easy to contact and
communicate [with] on a daiy basis that
rms can reach us a the time. The present
system has created too many sios, this
means rom the outside it ooks ike we dont
speak to each other and that we are not on
the same page, the probem is not that, the
probem is that we were tod to operate inthis manner.
We were ooking to deveop a sma projectin Waes. We had been having productiveconsutation with agency C but were thentranserred to agency B. the deaings wehad were dicut, we ended up having toamost start rom scratch, expaining whatwe were ooking to do .. in the end this wastaking up too much time, we coud not aford
to hang around, we instead chose to go toNewcaste.
We are more than happy to work with others.Over the course o the ast year there hasbeen a process o evauation o services andwe accept that things coud be done better. Inan idea word those who are good at doing
something shoud concentrate on that, thatway we buid experience and knowedge.
This view shows the internal complexity and the politics involvedin operational decisions. It appears that there are numerous
scenarios where this has happened and each time it reects an
ingrained notion about how an agency should operate rather
than what is best or the client (the rms) or Wales. It must also benoted that not all those involved are so rigid with their operations
and some are more open to developing better coordination o
services to improve overall perormance:
Poor interaction has bred competition between agencies.
Competition can be seen as positive in some cases but not to the
detriment o the overall goal. It is difcult to gauge the level ocompetion. A number o respondents indicated that there were
signicant issues when it came to cultivating contacts received.
There is a view that once initial relationships are ormed the "handholding" job ends and some agencies are expected to withdraw,
yet there is a signicant belie that this approach does not yieldthe best results:
When this was put to agency C there was an acknowledgment o
the mistake and an acceptance o the act that the current system
needed adjusting and currently creates more complexity or the rm.
This viewpoint was also expressed by other agencies and reects a
more complex underlying structure. For example, rm 1, which was
looking to invest in Wales, was working with one agency but got
passed to another and was given inaccurate inormation conictingwith what the rst agency had told them:
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selling Wales: the role of agencies in attracting inward investment10
This one respondents view was shared in some shape or orm by
a number o respondents: however ew wished to go into detailabout the WDA. It seemed to be a contentious subject or any o
those involved in inward investment work.
Although criticism was levelled at the WDA many respondents
elt that the marketing o Wales has been less eective since its
merger into the now Welsh Government.
There was again a consensus among all agencies that Wales
(during the late 90s and early 2000s) had established a boldimage internationally, but that in recent years this brand had
become less prominent and had lost value. This concept o brand
was raised by a number o the respondents, who have since let
their posts but who questioned what had happened to the oldWDA brand:
There was one exampe around the time o the Ryder
Cup, we had put a sizeabe advertisement into a North
American trade pubication. When we got a copy o
the pubication ater the competition another advert
appeared on the page opposite rom a oca authority
in another part o Waes. I am a or competition
but there must be a ine, whereby when advertising
gobay we are a seen to be puing together not
puing apart.
I think that the WDA had a ot o thingswrong with it at the end, in particuar the
structure, it was too boated, just too big.However the brand was sti worth a ot, Ihave been a around the word and I stihear companies taking about the WDA. Inact I woud suggest the brand is sti wortha ot, so ets use it.
Our marketing has been in a processo transition over the ast number omonths. There has been some scae back
rom initia panned action and that hasresuted in an about ace turn. Dont getme wrong, it is not that we have notbeen trying to attract inward investmentbut there has been a ot o efort onattracting certain types o investment.
marketing of wales/Cardiff
This view o selective attraction is shared by a number o the
agencies but many ound that this approach was causing a greatnumber o problems in terms o marketing. All agreed that ocus
was important when dealing with limited resources but some
suggested that too narrow a ocus meant that marketing wasineective.
Another area o concern is that respondents in dierent agenciessaid that previously there had been overlaps in advertisements,
with dierent agencies promoting dierent aspects o Wales/
Cardi in the same publication.
There was a consensus that inward investment activity is
marketing activity. This includes the marketing o general
locations, marketing o individual cities, and o Wales. To attract abusiness to any location, it is essential to portray the best aspects
o what the place has to oer and importantly that it be seen as
a good place to live. Divisions lie between respondents in how to
communicate this image.
This study has ocused on the Cardi city region, but two o the
agencies involved in the research (A and B) are both nationaloperators. There is a very clear message rom agency B that Wales
has not been marketed well over the last two years. There is anadmission that Wales has been seen as being closed or business
and an acknowledgment that other regions o the UK, notablyScotland, have taken advantage o this.
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11Cardiff Business sChool and Cardiff Business PartnershiP
Communication was a topic o much concern or respondentsand was touched on in almost all discussions, even those related
to other subjects such as interaction or marketing. It must be said
that communication issues were ound both between agenciesand within the external community the agencies work with, that
is prospective investors in Wales.
When looking rst at ormal communications betweenagencies there is a clear divide between the larger and smaller
agencies. Many respondents said that there is one directional
communication, reecting the protective nature o some.For example, the strategy o agency E contains details o on-going
discussions and collaborative activities. When questioned aboutthis the agency concerned said that presently this was only one
direction interaction.
In terms o indirect communication, that is general
communication between all those involved, there was little
similarity between agencies. Some had regular updates on the
other agencies work, while others were ar more independentand had ew i any dealings with the others.
i t k t s t msmmt t t sms t mst t.
S 2005 t t tt tt tm, stmt s t t t ttt, m s t tks t t.
i sk t t Swd St wst dmt a k
t ws m s tk t t mt t s, s
t stt ts m. w s ts ? Msmmt k mmt, st t t , m mtt
st k tt.
This view has been expressed by other respondents who
acknowledge a lack o communication taking place and its eect
on external communications.
Communication comes up again in other contexts, primarily in
terms o miscommunication o both policy and oering. Authors
contacted a number o companies which have either investedin the Cardi city region or which were considering investing.
The experiences o companies were very dierent dependingon agencies, the sector they were coming rom, and the
investment size. Overall there was a great deal o variability in the
communications that took place.
Some rms described the great service they had and the direct
line to the people that can make decisions. This positive response
was rom an SME who was coming to Wales. They were alsooperating in one o the Welsh Government's target sectors:
This experience was not shared by a rm operating outside thetarget sectors but o a similar size and larger investment than that
o the rst:
misCommuniCation
Going orward we need to pan better, there is a need or
a more joined up approach to ink together services and
to et each other know what the other is doing. There is
no point in not sharing inormation, a we are doing is
wasting our time shing in the same pond. To this point
we have strugged to get meaningu communication
between ourseves and agency D.
Everything went we, we had good contact right rom the start,
[and] there was a singe port o ca who deat with the process. Wewere ofered a great dea o support in terms o the operationa side omoving to [the ocation]. We were ony ooking at the Wesh site duringthe process as two o our key contacts are aready ocated in the area.Having ony visited Waes once or twice I thought it was very useuto get oca insight, ony probem was the ength o time it took to getthrough the processes but other than that I cant compain.
To be honest it was conusing, we deat with agency Bto begin with, it was dicut to get some answers towhat we thought were simpe questions. We spoke atength to the contact we were given and ater a numbero emais and phone conversations we were passed toagency A. The most annoying thing was that one did notte the other our u situation; we were given diferentinormation by one group over the other. We aso seemedto get tanged up in some interna issues, we kept gettingredirected and brought around the houses. We are not aarge rm, we dont have ots o staf deaing with this, it
was me, [and] I got rustrated with the ack o progress sothought we shoud move on.
This view highlights the signicant internal conusion that exists
around the notion o sectors. The miscommunication and
misinormation regarding the policy is rie. One respondent madethe comment:
I you are in computer game design what sectorare you in, creative industries or ICT?
Others too expressed the view that there was some lacko communication on how to prioritise inward investment.
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selling Wales: the role of agencies in attracting inward investment12
2000 20042002 2006 20082001 20052003 2007 2009
A number o individuals
contrasted the poor
perormance in Wales with therelative success that Scotland
has had in the recent past. It is
useul to look at the Scottish
case to put these commentsinto context. Existing data on
Scottish inward investment
attraction have been examinedto show trends over the
course o the last eight years.Respondents comments
on the work o SDI (ScottishDevelopment International)
have also been analysed.
There are two sets o data tocontrast. First is the type o
inward investment actuallybeing attracted. To this end this
research contrasts the gures
on R&D investment. This ishigh value activity associated
with the greatest economic
spillover to the wider economy.
The second measure is theaggregate numbers in terms
o actual projects that have
chosen to invest.
the case of scotland
inward
investment,
wales v sCotland
5
10
15
20
0
9
7
34
8
10
12
16
9
14
2
1
2
25 5
12
6
3
number of r&d inward investment Projects
*auThorS' conSTrucTion, daTa acceSSed FroM oFFice oF naTional STaTiSTicS (onS)
% of inward investment Projects against uk total
*auThorS' conSTrucTion, daTa acceSSed FroM oFFice oF naTional STaTiSTicS (onS)
2000 20042002 2006 20082001 20052003 2007 2009
12
10
8
6
4
2
0
10
9
11
9
8 8
6
10
6 6
2 2
3 3
55
7
9
7
9wales
key
scotland
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selling Wales: the role of agencies in attracting inward investment14
This report has analysed the views o
those who are or have been involved
in attracting inward investment to
Wales. It has looked across multiple
agencies with dierent remits to try
and piece together the inrastructure
that exists in Wales at the present
time. There is a consensus that
change needs to happen; all agenciesacknowledged this and would
welcome it. The market or inward
investment has shited dramatically
in the last 10 years. In the last fve
in particular, with more proactive
strategies by development agencies
across the UK and Europe, the need
or more targeted and intensive
marketing has become greater.
Wales has some key assets at its disposal and there
is valuable experience and expertise in all o the
agencies currently operating in the Cardi cityregion but, at the moment, it appears that these
agencies are greatly ragmented and disjointed.
There is a lack o cohesion in operational and
strategic coordination o services. Some agencieshave done very impressive jobs given the limited
resources available to them. An example o this is
the work o agency C, which has been developing ascheme whereby successul Welsh business people
are recruited to promote the area.
There appears to be some difculty with theoverarching brand o Wales, with dierent agencies
saying dierent things. There is a continual pressure
to attract inward investment and yet there is noclear coordination o activities.
The Welsh Government has undertaken a number
o reviews and reorganisations over the last ewyears but, given the devolved agencies' activities,
there needs to be a greater emphasis on joining up
services.
The sector approach adopted by the WelshGovernment has also been adopted by the
other agencies and they are actively seeking toencourage investment rom particular sectors.
However, given the specic nature o these
sectors, one agencys work can oten overlap withanothers. This duplication o campaigns does not
reinorce the message as there is little coordination
to make sure the correct targets are being met.
There is also the problem o competition between
agencies. Presently this has created a divide
between some o them and a result is a lack o
resource sharing and duplication o enquires.Respondents recognise that there is too much
emphasis put on a limited number o sectors and
so have suggested that there needs to be moredone to attract inward investment in general rather
than just specic targets. At a Cardi city region
level, issues around ragmentation particularly interms o marketing might be resolved by closer
joint project work or through a reconguration o
existing resources.
conclusions
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15Cardiff Business sChool and Cardiff Business PartnershiP
The evidence in this report indicates
that there are some signifcant
shortcomings in the current structures
in place in the Cardi city region to
attract inward investment. This reports
in-depth approach has allowed those
doing the job today to express their
thoughts and concerns over the
present inrastructure.
It is recommended that there should be greater
coordination o services. One option would
be that a single agency link together activitieswhere possible, grow synergies where they exist
and then put in place plans to exploit them. This
could be done by an existing agency with an
extended remit.
One o the most signicant issues identied in
the report is the outside worlds perception o
Wales competitive brand image. In order orany investment to come to Cardi or Wales it
needs to be seen as an attractive place to be. A
more proactive marketing campaign designed
to let global rms know what Wales has to oer,both in terms o skills and in terms o location,
is required. To date the brands o Wales and
Cardi have been communicated too weakly,with dierent agencies each trying to ocus
on separate components. This ragments theoverall message. It is recommended that a single
coherent brand should be adopted. This neednot mean dismantling agencies but it would
encourage them all to y the same ag.
Previous approaches by Wales, notably during
the late 90s, had a greater coherence and
consistency in brand messages. These produced
a well understood and recognised 'brand' orWales (the WDA brand is still well recognised
years ater it was disbanded) and this helped
attract large amounts o inward investment.It is recommended that a review o the current
situation takes place and that steps are taken toaddress the issues identied.
The nal recommendation is that in any
reorganisation within the Welsh Government's
economic development team there shouldbe some provision or the support o inward
investment rom outside the key sectors.
It became clear rom the report that certainsectors which do not t into the Governments
key sectors are currently being treated in a
subsidiary manner. This needs to be addressed
to both maintain the brand image o Wales andto encourage economic development.
future research
Attracting inward investment will continue
to be important in the coming years and,with continued global development, more
competition will exist. It is important that Cardi
and Wales have a strong brand recognisable
across the world. Future research could examinethe actors which are important in developing a
strong brand or inward investment.
recommendations
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selling Wales: the role of agencies in attracting inward investment16
Bellak, C. and Leibrecht, A. (2005) Do
low corporate income taxes attract
FDI? Evidence rom eight Central and
Eastern European countries, University o
Nottingham Research Paper 2005/43.
Blomstrm, M., Kokko, A. and Globerman, S.
(2000), The determinants o host country
spillovers rom oreign direct investment: a
review and synthesis o the literature, in Pain
(2000).
Charlton, A. (2003) Incentive Bidding
or Mobile Investment: Economic
Consequences and Potential Responses,
OECD Development Centre Working Paper
No. 203 (Formerly Technical Paper No. 203)
Cooke, P. and Morgan, K. (1998) The
Associational Economy: Firms, Regions and
Innovation (Oxord University Press, Oxord).
Hill, S., and Munday, M., (1992) The UK
Regional Distribution o Foreign Direct
Investment: Analysis and Determinants,
Regional Studies, 26 (6): 535-544.
Pain, N. (2000). (ed.), Inward Investment,
Technological Change And Growth: The
Impact O Multinational Corporations On
The UK Economy, Palgrave Press.
Wells, Louis T. and Wint, Jr. Alvin G. (1990)Marketing a Country - Promotion as a Tool
or Attracting Foreign Investment, Foreign
Investment Advisory Service occasional
paper No. FIAS 1.
selling Wales: the role of agencies in attracting inward investment16
references
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17Cardiff Business sChool and Cardiff Business PartnershiPCardiff Business sChool and Cardiff Business PartnershiP 17Cardiff Business sChool and Cardiff Business PartnershiP
annex 1 - new inward investment, uk and wales
wales
key
uk
uk ranking
Percentage
9.2
6
2005-06
new jobs
uk uk
34,077 36,526
9.3
4
2006-07
new jobs
8.3
6
2007-08
new jobs
6.4
4
2009-10
new jobs
6.2
7
2008-09
new jobs
ukwales
3,743 45,051
ukwales
2,185 35,111
ukwales
3,431 53,358
inward investment -new jobs 2005/06 - 2009/10
Source: uK Trade & induSTry
noTe: (1) analySiS baSed on Secured
projecTS, aS per uKT&i eligibiliTycriTeria
wales
3,132
wales
3,379
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selling Wales: the role of agencies in attracting inward investment18
table 1: foreign direct investment across the uks nations and regions (by number of Projects)
(*) includeS london Source: ernST & youngS european inveSTMenT MoniTor
Source: uKTi daTa
2000
281
55
48
17
39
35
27
27
15
20
10
574
6%
Region
SOUTH EAST (*)
SCOTlAND
WEST MIDlANDS
NORTH
NORTH WEST
Wales
SOUTH WEST
YORKSHIRE & HUMBER
EAST ANGlIA
NORTHERN IRElAND
EAST MIDlANDS
ToTal
Waless %
2004
242
64
46
50
28
35
22
24
25
16
11
563
6%
2001
168
35
31
11
20
19
9
23
16
21
17
370
5%
2005
287
33
43
49
27
13
20
17
30
18
22
559
2%
2002
169
25
17
34
10
27
31
15
18
13
10
369
7%
2006
379
62
49
31
37
16
23
14
28
17
29
685
2%
2008
342
53
37
37
51
35
29
22
30
19
31
686
5%
2003
169
39
32
46
33
42
28
25
5
10
24
453
9%
2007
410
69
54
42
26
22
9
16
29
26
10
713
3%
2009
346
51
51
39
37
20
32
42
19
25
16
6783
3%
ToTal
2,793
486
408
356
308
264
230
225
215
185
180
5,650
4.7%
3uKTi t ss tt uK stmt 20092010 s 1,619. eiM uKTi ft mts t t a d s t mts m.
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19Cardiff Business sChool and Cardiff Business PartnershiP
table 2: inward investment new jobs over the last ten years
2000-01 2001-02
6.3% 11.3%
7 1
wales
4,520
uk
71,488
wales
3,872
uk
34,087
2002-03 2003-04
11.8% 15.9%
3 1
wales
4,083
uk
34,396
wales
4,064
uk
25,463
2006-07 2007-08
9.3% 8.3%
4 6
wales
3,379
uk
36,526
wales
3,743
uk
45,051
2008-09 2009-10
6.2% 6.4%
7 4
wales
2,185
uk
35,111
wales
3,431
uk
53,358
2004-05
6.5%
9
wales
2,593
uk
39,592
2005-06
9.2%
6
uk
34,077
wales
3,132
key new jobs ranking against the uk's 12 geograPhic areasyear wales uk Percentage
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rePort authors
andReW cRaWleyis a Research Fellow at Cardi
Business School working with Cardi BusinessPartnership. He has been involved in publishing
reports on sector analysis and regionaleconomic issues within Wales. His research
interests lie in industrial economics, spatial andregional economic analysis.
max mundayis Director o the Welsh EconomyResearch Unit at the Cardi Business School and
Proessor o Economics. He has been involved
in research projects that have examined the
development o the Cardi economy and thedevelopment o key sectors in the city area.
Rick delBRidge is Associate Dean or Research
and Proessor o Organisational Analysis atCardi Business School and a Senior Fellow
o the ESRC/EPSRC Advanced Institute o
Management Research. His research interestsinclude the organisation and management o
innovation. He is co-author oThe Exceptional
Manager(Oxord University Press).
aCknowledgements
In preparing this report we
are very grateul to all thosewho took part in interviews
and who responded toquestionnaires.
ContaCt detailsDr. Andrew Crawley
Tel: +44(0)29 2087 5079
Email:
Cardi University
Aberconway Building
Colum DriveCardi
CF10 3EU
UK
deSign: www. blacKSheep.inFo
sellingwales:
the role of agenciesin attracting
inward investment