EU referendum: UK economy on course for investment boom once Brexit vote is done with

 
Jake Cordell
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UK manufacturers have lost £3bn in the first half of 2016 to delayed investment
UK manufacturers have lost £3bn in the first half of 2016 to delayed investment (Source: Getty)

Around £6bn of investment in the UK economy has been delayed due to the EU referendum, with large portions set to come flooding back whatever the result of the vote.

The Centre for Economics and Business Research (CEBR) calculated 70 per cent of the lost investment would rush back by the end of the year if the UK votes to Remain, while 30 per cent – or £1.8bn – will still return even if the Leave camp wins out.

The investment rush should prop up the UK economy in the third quarter of the year, Douglas McWilliams, president of the CEBR said.

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"The end of the referendum campaign could be followed be a mini boomlet for the UK economy," McWilliams said.

"There has clearly been a delaying of investment projects, both from inward investors and from indigenous investors.

"Despite being put on hold before the referendum, not all of the investment shortfall will disappear if the UK votes to Leave."

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Around half of the delayed investment has been in IT projects, the CEBR said. A further £2bn has been lost by manufacturers delaying big spending on plant and equipment, with another £1bn delayed from property and buildings.

However, with half of the delayed spending originally earmarked for the manufacturing industry, McWilliams added that the UK's makers will have felt the slowdown more acutely given their much smaller size as a proportion of the total economy.

If the pound were to drop sharply on a vote to leave, McWilliams said that could spur further inward investment, though the bigger investment boom will still come from a Remain vote.

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