It's not just in the U.S. where incentives games are playing out.
   In an attempt to push more investment toward new European Union members like Poland, Hungary and the Czech Republic, the EU's investment authorities are pressuring older member nations offering generous incentives, calling it unfair competition. EU authorities have signaled interest in harmonizing incentives across the EU, which could mean fewer negotiating opportunities. One notable recent example of this new attitude was the Intel expansion at Leixlip, Ireland, which appeared a fait accompli until EU authorities stepped in and nixed the deal over Ireland's pledge of $120 million in incentives.
   "The EU has made it very clear that they'll fund Eastern European incentives. They are taking Ireland off their list of protected, favored nations, which get the major incentives," explains John Spangler, vice president of Seagate Technologies, and director of the hard-drive producer's Springtown, Northern Ireland, facility. "The EU is trying to direct new investment to locations they want to develop, and Ireland is not one of them." By contrast, AMD received $2 billion in incentives from the EU to build its newly announced Dresden, Germany, plant. The company's $2.5-billion Fab 30, just opened in Dresden in 2005, received a mere $699 million in government subsidies.
   This enforcement from above could be contributing to a change in the Irish government's focus as well. A nation that famously slashed its corporate income tax rate in the 1990s to attract international businesses now appears to be favoring home-grown companies. "Ireland does seem to be backing away from incentives to multinationals. The local governments want to grow internal businesses instead," Spangler says.
   In Northern Ireland, Seagate's own recent decision to add on to existing facilities in Springtown and nearby Limavady hinged on several factors, including a $47-million incentives package from Invest Northern Ireland.
   But Spangler said the decision to expand in place made sense for a number of other reasons as well, including the availability of space on the existing site. "We had already invested $600 million in the site, so it would be difficult to justify starting from scratch in a greenfield location elsewhere. There was room to expand, we have a great productivity record, and there was grant money available," Spangler says. "There was no compelling reason to go anywhere else."