U.S. companies use the U.K. as bridge to EU market
U.S. investors should brace for the vote too, said Joseph Quinlan, head of market & thematic strategy Bank of America Global Wealth & Investment Management
In terms of the impact on the U.S., it’s hard to find any positives in the case of a Brexit, Quinlan said. He explained that for decades Britain has served as a “strategic gateway” to the wider European Union, with U.S. multinationals using the U.K.’s access to the wealthy EU as a “profit-generating strategy.”
Direct investments into the U.K. has also been significant in recent years compared with other large economies. U.S. corporate investment into Britain totalled $588 billion in 2014, more than double the amount invested into South America, the Middle East and Africa combined, according to the BofA report.
“Wealthy consumers, respect for the rule of law, the ease of doing business, credible institutions, membership to the European Union—all of these factors and more have long made the U.K. a more attractive place to do business for American firms than either China or India,” Quinlan said.
“In the end, U.S. companies from all stripes—finance, healthcare, autos, chemicals, food and beverages, technology, energy—have made a huge bet on Britain and the U.K. over the past few decades... the question is this: Is corporate America’s big bet on the U.K., in general, about to go bad? It’s a question U.S. investors need to keep top of mind in the months ahead,” he added.
(source: MarketWatch)
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