The Welcome Grows Cool

A change of attitude is taking place on the international scene that has potentially vast consequences for business men in the U.S. and in many other countries. In some parts of the world particularly Western Europe, there is growing concern that heavy investments by U.S. industry threaten to dominate whole economies. U.S. businessmen last year increased their direct investments abroad by $3.4 billion to a record $41 billion. This year the rate is growing even faster, and the ubiquitous Yankee investors are drawing more and more cries of "dollar imperialism."

Ultranationalists in Brazil last week sought to block M. A. Hanna's plans to mid a $25 million iron ore port, even though the government seemed deter mined to approve the deal, and the Supreme Court will rule soon on whether any foreign company has a right to mine in Brazil. In Australia, where U.S companies are investing at the rate of $4,000,000 a week, the government is under mounting pressure to require part local ownership of foreign subsidiaries At a special luncheon in Paris, the creme de la creme of France's business leaders listened last week to dire predictions that their country may be over run by an "invasion" of powerful U S corporations, whose investment there has risen to $1.2 billion. Said Rene Sanson of the National Assembly's finance commission: "The potential of the U S scares me."

Giant Squeeze. No major country is ready to slam the door on U.S. businessmen, but the welcome is cooling most rapidly where recent American in vestments have been heaviest. As the flood of dollars shows no sign of receding, European businessmen are increasingly worried about being squeezed out by U.S. corporate giants, which have such a high scale of financing, research and marketing. In West Germany, where U.S. business has a $2 billion stake and General Motors' Opel has become a formidable competitor of Volkswagen German industrialists are beginning to pressure the government to do something. While Italy still courts investments for its underdeveloped south, a former Cabinet minister has expressed "reservations" about the extent of U S capital in Italy. Even in countries that encourage U.S. investment, there ias been increasing criticism that American business subsidiaries are a disruptive influence, overpaying and overhiring, then laying off local workers on short notice.

France has raised the loudest outcry, and has followed its words with action. Before French Deputies would endorse a draft of the government's fifth economic plan last month, they demanded that Le Plan be rewritten to deal more directly with the "colonization" of France through U.S. investments, which they believe to be the nation's No. 1 economic problem. The Deputies also voted to revise the tax laws to encourage mergers and to require foreign investors to buy stock in French companies only through French bourses, thus preventing another surprise takeover a la Chrysler-Simca.

Whose Caravelle? For the countries involved, there are a lot of complications and irritations in dealing with the problem of the overwhelming American presence. French businessmen concede, for example, that it is too late to regain control of certain sectors of the country's industry that are now dominated by U.S.-owned companies, such as food processing, synthetic rubber, farm machinery and electronic computers. The problem is also one of pride as well as of economics. It was almost more than President de Gaulle could bear when, earlier this year, he learned that he would not be able to promote his China policy by selling Caravelle jetliners to Mao Tse-tung. Reason: too much of the Caravelle's electronic equipment was American, and thus came under the U.S. Battle Act against trading with the enemy. In spite of all the complaints, many countries are unwilling like France, to get really tough on foreign investors. They do not want to scare off the large infusions of money their economies need to keep growing.

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