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Tuesday, September 09, 2003

Outsourcing and the EU

As the comments below from Siemens CEO Heinrich von Pierer indicate, it isn't only the US who has to think carefully about what is happening in outsourcing. Unfortunately, even the upping of high tech R&D is not necessarily a solution, since with time the routine bench work is always likely to find a cheaper home elsewhere. (Thanks T-Salon for the link):

Mr von Pierer will paint a fairly upbeat picture of the competitiveness of European manufacturers in his speech, for a conference on European industry organised by the German British Forum. He will say many companies have learned how to operate high-class factories within the context of Europe's high labour costs. But, he warns, if more manufacturing operations switch from western Europe to low-cost countries such as China, that would also damage service industries - which account for 60 per cent of European gross domestic product...........

He says that to safeguard the health of European industry, governments and companies should step up research and development spending, particularly in fields such as biotechnology and nanotechnology.
Source: Financial Times

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