Investment: UK remains number one in Europe

The much-awaited EY 2016 UK Attractiveness Survey came out this week and confirmed the UK as number one in Europe for foreign direct investment (FDI).

Not only that, but the UK is seen as the place in Europe from which the next tech giant is most likely to emerge - a great endorsement of the talent in our digital industry - and it is the European leader in financial services investment. These are the sectors ranked in first and second place by investors as potential drivers of future growth. 

We have performed strongly when it comes to attracting inward investment from the emerging markets, with projects from India up by 58% in 2015 and those from China up by 79%.

Given my previous experience in China, I am particularly pleased about this last fact.

I know how much work goes into landing these inward investment projects. Only this week, Canada’s Magna International announced that it will create 295 jobs in Telford, one of our Midlands Engine towns. This very welcome decision was the result of long and patient negotiations, helped by UKTI’s Automotive Investment Organization.

I spend a lot of time talking about how we are transforming UKTI’s help for exporters, but a quieter revolution is on-going in the way we approach investment. Our strategic relationship management and a long-term approach are paying dividends. We are going out and pitching the UK as the place from which international businesses can expand.

That’s why I was interested that Ernst & Young asked investors why they decided to come to the UK.

These were certainly hard-nosed business decisions, but soft power played an important role.  As you would expect, our skilled work force, entrepreneurial culture, domestic market and infrastructure were listed as important – as was our access to the European single market, cited by four out of five investors. Topping the list were our quality of life, diversity and language; our education; and our social stability.

Investment matters to the UK. It has created over 300,000 new jobs here since 2010. In 2014/15, new jobs were being created at the rate of 1,600 a week, and 80% of the projects that create this investment land with UKTI’s help.

Many countries would love to steal our crown as number one in Europe for FDI, so we need to keep on our toes.

This year part of our offer to businesspeople who might want to locate in the UK is the International Festival for Business, which runs for three weeks from 13 June in Liverpool.

We are inviting investors to come and see for themselves what the UK has to offer. We want to put them together with the best and brightest of British companies. And to help with the chemistry, we will be showcasing a huge range of innovation, and celebrating Liverpool, one of our great Northern Powerhouse cities.

It was this region that saw the biggest jump in investment projects in this week’s results. Projects have risen by 127% in the two years since the Northern Powerhouse came into being, showing, in EY’s words, that “devolution is starting to work, and foreign investors are helping to rebalance economic activity more evenly across the country.”

There were positive results for Scotland too, where the UK and Scottish Governments work together to land inward investment.  

They say that good things always come in threes. The EY report is the first of the reports on inward investment that are due out over the summer. Still to come are UKTI’s own investment figures, and UNCTAD’s flagship World Investment Report. So, will the UK retain its crown? Watch this space.

Register for UKTI events at the International Festival for Business.

Download the EY 2016 UK Attractiveness Survey and the EY 2016 Scotland Attractiveness Survey.