Foreign investments have been a major part of the British economic revival over the past few decades, bringing new capital, ideas and talent to the nation, British journalists told the May 23 symposium.

If Japan wants to attract foreign investments, it needs to put up a clear “for sale” sign, and the recent rejection by Tokyo of a bid by a British fund to increase its stake in the Electric Power Development Co. may have sent the wrong message to overseas investors, they said.

Foreign capital buying up your major companies or key infrastructure operators can be a sensitive question involving national pride and security concerns. But it has become generally accepted in Britain that benefits outweigh possible problems, the journalists told the audience.

“Britain has been extremely open — probably more open than any other large country in the world — to foreign investment,” said Robin Harding, economics leader writer for the Financial Times.

Harding admitted that the question of national pride has come up to some extent whenever British firms were bought up by foreigners. “But since it started to happen maybe 20 years ago, a lot of extremely large British companies, including several of the top 50 companies, have been bought by foreign investors, and I think what people have realized is that good things can come from it — new management methods and ideas come from abroad,” he said.

Damian Reece, head of the business section of The Daily Telegraph, said the assumption in Britain in recent decades has been that the country needed foreign investors “given that our economy had up until 30 or 40 years ago been running into the ground.” While the topic has been debated a lot in Britain, “we’ve always encouraged foreign ownership (of British firms) because a more diversified ownership base of your economy can actually reduce risk to your economy,” he said.

Furthermore, “greater foreign ownership attracts greater foreign talent to the U.K. and expands the intellectual gene pool, which in an island nation is extremely important,” he added.

One example of an industry being revived through foreign investments may be British car manufacturing, said Jonathan Guthrie, an enterprise editor and columnist for the Financial Times.

“British people often believe that we don’t really make cars in the U.K. anymore. It isn’t true. We made more cars last year than we had ever made before, many of them made in factories run by Japanese companies such as Toyota, Honda and Nissan,” he said.

“One of the things that emerges is if everybody trades with everybody else, everybody can be a winner,” Guthrie said. “It’s the free flow of ideas and capital between nations that one needs to prioritize.”

One of the recent controversies involving foreign investments in Japan involved a British fund, The Children’s Investment Fund (TCI), which sought to increase its stake in an electric power wholesaler popularly known as J-Power to 20 percent.

After an extended screening process under the Foreign Exchange and Foreign Trade Law, the Japanese government turned down the fund’s bid, citing energy security risks. Under the law, foreign investors need government approval before taking more than a 10 percent stake in a Japanese firm in sectors such as electric power deemed critical to national security.

What’s important in accepting foreign investments, Reece said, is “sending the right signals about making sure that foreigners feel secure when they commit their capital to invest in a country.

“It’s about making sure that foreigners feel that rules and regulations are going to be consistent and clear, and they know what they are getting themselves into when they make the decision to invest,” he said.

The rules need to be enforced “in a predictable way,” Harding noted. And the problem in the dispute over TCI and J-Power was “not that Japan has blocked an investment on national security grounds — everyone does that. The problem was that there was no pre-existing framework so people could expect that to happen.”

“A lot of investors in London think that it was a politically motivated decision by the Japanese government because it didn’t want foreign management to put pressure on a Japanese company,” he said. “They don’t believe it was national security. It probably was about national security. But unless there is a clear framework, foreign investors won’t believe this and are scared off.”