Further increase

Scotland remains a magnet for inward investment

Adrian Gillespie: compelling strengths

Scotland continues to be a magnet for inward investors, recording a 14% increase in projects during 2021.

This compares to an increase in foreign direct investment (FDI) of 1.8% across the UK and 5.4% across Europe.

The latest survey results show Scotland’s perceived attractiveness to investors now sits at a record high, with 15.85% of investors rating it as the UK’s most attractive FDI location, up from 15% last year and more than doubling its rating from the pre-pandemic period (7% in 2019).

EY’s latest annual attractiveness survey confirmed Scotland was again the most attractive location for inward investment in the UK outside of London.

Edinburgh, Glasgow and Aberdeen remain in the top 10 locations outside of London for attracting inward investment projects. Edinburgh alongside Manchester is ranked equal first; Dundee and Livingston also make the Top 20.

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Scotland performed strongly in high-value, high-growth industries like digital and utilities alongside a rebound in manufacturing FDI. The four leading sectors were digital technology (33 projects), utility supply (18 projects), business and professional services (14 projects), and machinery and equipment (14 projects).

Digital projects in Scotland rose by 73.4%, in contrast to a 7% decline in Europe and 7% growth in the UK overall. Scotland is now firmly established as the UK’s number two location for digital projects behind London.

The data counts investment from other parts of the UK, whereas data produced by the Centre For Economics and Business Research put Scotland as fifth most popular destination in the UK for overseas investment.

Commenting on the EY research, Trade Minister Ivan McKee said: “It is great to see these latest results, which show Scotland leading the UK when it comes to securing Foreign Direct Investment, in spite of the significant challenges posed by Brexit and the pandemic. That is testament to our skills base, and our highly qualified workforce.

“We have been the most successful nation or region in the UK, outside of London, for nine of the last 11 years and for the 7th year running, in attracting FDI.

According to figures available to EY, more than 10,000 Scottish jobs were generated by FDI projects in 2021, more than double the approximate 4,500 figure in 2020.

EY’s results, which cover the calendar year January-December 2021, aligned with Scottish Development International (SDI) figures announced earlier this month that showed more than 7,500 planned real living wage jobs had been generated by inward investment in FY21/22 (financial year), with 113 investment projects in Scotland supported, 39 of which were investors locating in the country for the first time.

Adrian Gillespie, Chief Executive of Scottish Enterprise, said: “Today’s EY Attractiveness Survey underlines the compelling strengths Scotland has to offer on the international stage. 

Professor Russel Griggs, chair of South of Scotland Enterprise, said: “These survey results are another positive indicator that Scotland is a hugely attractive country to invest in.”

Vicky Grant, Highland and Islands Enterprise’s head of international trade and investment, added: “There’s no doubt that the Highlands and Islands is making a huge contribution to Scotland’s attractiveness as a location for foreign direct investment.”

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