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Government likely to offer Nissan aid to build Almera replacement at Sunderland

After Nissan CEO Carlos Ghosn's suggested last week that the decision on whether the Almera's successor would be built at Sunderland could depend on Britain's accession to the euro zone, a DTI official was reported by The Observer of 11 January to underline the importance of attracting the company's fresh investment to the North East.

”There are a number of levers at our disposal, there are regional policy considerations and we can assist. Essentially it has not changed (since 2001), the only difference is that the amount of money we are allowed to give is much less: it is about a third of what it was (when the Government paid some £40m to encourage Nissan to invest £235m in the Micra at Sunderland).

The EU's rules for selective regional assistance subsidy were altered at the beginning of 2003 to permit grant aid equal to 6% of firms' investments, in place of 20%. The EU's state aid regime for the automotive industry was prolonged last year, while its longer-term future is to be reviewed, alongside the aid regimes applying to some other industries that are regular recipients of investment subsidy linked to restructuring of capacity.

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