INVESTORS are increasingly turning to the UK instead of other European countries, with the number of large foreign direct investments jumping by 15 per cent as growth picked up during the last year.
The UK is now ranked first in Europe among global investors, who were asked by audit giant EY which countries they believe will be attractive sources for capital in the next three years. Germany is now in second place.
London is also taking an increasingly dominant position for investors. Just fewer than half the 799 projects last year were centred on the capital, with 380 in total. The city’s share of investment is also growing at a faster pace than the country as a whole, up by a fifth during 2013.
For the European continent as a whole, there was only a four per cent increase in the number of projects, and the UK now makes up a fifth of such investments in Europe.
“In the forthcoming year, we will focus even more on investment from export-orientated companies and fast-growing economies, while promoting the attractiveness of all regions of the UK,” said Lord Livingston, trade and investment minister.
Surpassing Germany means that the UK is now in fifth place internationally, ranked behind only the much larger economies of China, the US, India and Brazil.
Broken down by sector, the UK attracted 20 per cent more research and development projects than Germany, and took a third of European software projects.
However, the report also suggests the UK is lagging on investment for manufacturing. Only 12 per cent of industrial investments in Europe go to the UK, far less than its general share and a category in which Germany performs impressively.
Speaking at the international festival of business in Liverpool yesterday, Prime Minister David Cameron said: “This government wants to work on behalf of every business in Britain to drum up trade, encourage investment and pave the way for growth.”