Liam Fox: ‘UK bucking the global trend’
Britain is the top investment destination in the world, overtaking the United States which has held the top spot since 2014.
The data has emerged in a survey on corporate deal-making published by consulting and accounting firm EY.
Germany, China and France followed, with Canada, India, Australia, Brazil and the United Arab Emirates next in line.
EY said the UK had topped the rankings “despite continued uncertainty stemming from its intention to leave the European Union…mergers and acquisitions activity during the period since the 2016 EU referendum has remained strong.”
The pound’s fall since the June 2016 vote to leave the European Union has made British assets cheaper, but Steve Krouskos, a global vice chairman at EY, said Britain also remained an “open environment for foreign investors” even in the midst of the Brexit chaos.
Liam Fox, Secretary of State for International Trade, said: “Today’s report shows that despite the challenging global economic environment, the UK is bucking the global trend and continuing to attract the world’s top investors to our shores, with UK FDI stocks reaching a record high of £1,337bn in 2017.
“My department will continue to support international businesses invest in the UK to ensure the benefits of foreign investment are felt in all four corners of the country.”
The EY survey, first established 10 years ago, was based on responses from more than 2,900 senior executives across 47 countries in February and March 2019.
Last year, the UK accounted for 10% of global merger and acquisition activity worth a combined $400bn (£350bn). Its top investment sectors were consumer products and retail, industrials and financial services.
The UK’s top sectors for investment were consumer products and retail, industrials and financial services. Chinese investment into European technology has quadrupled.
Last week, the International Monetary Fund cut its global growth forecast for this year to 3.3% from 3.5%, largely because of trade tensions, particularly between China and the US.
Mr Krouskos said the mood among executives is better than the growth forecasts suggest. “The increase in acquisition appetite is a clear indication that executives are focused on their pursuit of growth, underpinned by high expectations of their own future performance,” he said.
“There is uncertainty in the market, but for many, disruption is driving M&A rather than stalling it -– deals are a means to reshape portfolios at an accelerated pace and futureproof businesses.”
Foreign minister Jeremy Hunt met Japanese Prime Minister Shinzo Abe on Monday to try to reassure him that Brexit should not affect Japanese investments in the country which employ hundreds of thousands of workers.
Mark Brownridge, director general of the Enterprise Investment Scheme Association, said: “This huge jump in foreign investment into European tech from China shows that the technology arena is clearly still a hugely attractive investment opportunity.
He said it is clear that “despite Brexit uncertainty surrounding Europe and the UK, there is no slowdown in appetite for the investment opportunities that exist, especially in the fast growing tech sector.”