News today that Waterford Crystal could “quit” Ireland if the government refused to back a new round of loans there: In a statement, Waterford said it “believes that it is desirable for Ireland to maintain Waterford Crystal in Ireland. It further believes that the commitment of its investors deserves the support of the government, which is being asked for a guarantee for a three-year period, not a loan or a grant.”
I argued in Helsinki last month that the huge multinational companies will increasingly pose a challenge to national sovereignty in coming years because of the incredible economic bargaining power they’ll have over countries—especially smaller countries. If Nokia, which accounts for nearly 5 percent of the GDP of Finland, decided it wanted to leave the county, can you imagine what Finland would be willing to give up to keep it there? What about Toyota leaving Japan for Korea? Or Ford deciding to move to Canada to save its health care bills?
Here’s a smaller case with Waterford. I know Ohio, Pennsylvania, or any of a dozen other U.S. states or countries would bend over backwards to attract Waterford.
It’ll be interesting to see how this plays out. Will this be one of the first economic blackmail cases of the 21st Century?
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