For bargain basement America, foreign investment no panacea

[flashl]

HOLLAND, Michigan: Only four years ago, a low-slung factory on the fringes of town here was stagnating and shedding workers. Then Siemens, the German industrial giant, bought the plant and folded it into a global enterprise. Today, the factory is shipping wastewater treatment equipment to Asia and the Middle East, and employing twice as many workers.

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About 60 miles, or 100 kilometers, to the northeast, such talk provokes contemptuous snickers. Two years have passed since a Swedish multinational shut down what had been the largest refrigerator factory in the country, a sprawling complex along the Flat River in Greenville.

The company, Electrolux, sent production to Mexico, eliminating 2,700 jobs in a town of 8,000 people.

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For many communities like Holland, the consequences include new jobs at decent pay, fresh capital to finance expansion and links to markets around the globe.

Yet many others are suffering from being branded superfluous by huge enterprises with factories around the world. Greenville, still struggling to absorb the loss of so many jobs, attests to that reality, providing an answer to the question: What happens to a company town after the company moves away?

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The surge of foreign money reaching the United States is being propelled by a confluence of factors. The dollar's weakness against the Japanese yen and European currencies makes American companies inexpensive for many foreigners looking to invest. The United States remains the world's largest market, and buying an American company is typically the swiftest way in. American companies are suffering from a scarcity of credit, making many willing to sell assets to raise cash.

IHT