FEW North-East businesses are as closely associated with the European question as Nissan, but the motor manufacturer believes that enlargement of the EU will have little or no immediate impact on its Wearside operations.

But, it is the medium and long-term effects which may prove most important amid continuing rumours that Nissan is considering relocating some of its production to sites elsewhere on the Continent.

At present, Central and Eastern Europe does not rank among Nissan's most vital markets. In 2002, the firm sold 43,500 vehicles in the region - 80 per cent of which were made at Nissan's factories at Sunderland and Barcelona. By last year, the numbers had risen to 54,600 - a rise of 25 per cent in just 12 months indicating that Eastern Europe could represent a potential growth market for the company.

But, healthy as the numbers are, they remain peanuts compared to the 500,000 vehicles Nissan sells in Western Europe.

In the run up to accession, the ten new members have already been operating under tariff arrangements which shadow European Union import regulations, so in the short term companies such as Nissan will notice no direct difference when membership is completed next month.

Where EU expansion may make a long-term difference then is if it delivers the goods on growth. The new member states represent a potentially significant customer base if EU membership lives up to the promise of creating a vibrant consumer society in the former Soviet Bloc.

But it is in the medium term where the danger of EU enlargement lies for the future of the 4,500 jobs on Wearside and the estimated 10,000 jobs elsewhere in the region dependent on the plant.

Nissan chief executive Carlos Ghosn has made no secret of his desire to see Britain join the euro. Earlier this year speculation rose that the contract to build the new generation Almera may not go to Sunderland unless the UK agreed to abandon sterling.

Renault, which holds a sizeable stake in Nissan, already operates a production plant in Slovenia and Mr Ghosn said it would be "relatively easy" to switch production between plants.

A Nissan spokesman said: "There are no plans to build or manufacture cars in Central or Eastern Europe, as it stands at the moment."

Two years ago, similar speculation over the future of the new Micra model ended when the Government agreed a £40m Regional Selective Assistance grant for Nissan on Wearside.

However, after May such grant assistance will be steered towards the poorer areas of the EU among the accession countries, which means that while the UK could offer Nissan grants worth six per cent of start-up costs, Eastern Europe could offer 20 per cent - an incentive which in cash terms could be as much as £15m-£20m higher and could tip the balance against Sunderland.