Post-Covid optimism

Scotland will remain target for foreign investors

Glasgow was the second most attractive UK city for financial services FDI (pic: Terry Murden)

Scotland’s financial services sector is expected to remain a prime location for overseas investors in the post-pandemic economy.

Investor sentiment suggests that the UK will continue outperforming the rest of Europe as it did last year and that Scotland will be particularly attractive.

Forty per cent of investors believe the UK will be more attractive for financial services investment from overseas post COVID-19, compared to just 8% who believe Europe as a whole will be more attractive after the crisis.

The findings appear in the latest EY UK Attractiveness Report for Financial Services 2020, published today.

Scotland increased its share of financial services foreign direct investment (FDI) in 2019 and secured Europe’s largest international investment project in terms of job creation, while project numbers across Europe fell.

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There were eight financial services FDI projects secured in Scotland last year, creating an estimated total of 2,911 jobs – more than three times the employment number for London (estimated to be 806) and more than half the UK total (estimated to be 4,443).

At a city level, Glasgow was the second most attractive city in the UK for financial services FDI in 2019, having secured more than three times the number of projects than Edinburgh.

At the UK level, Scotland was the second most attractive location for financial services FDI in 2019 for the seventh consecutive year, with its share of all financial services FDI into the UK increasing from 6.3% in 2018 to 8.1% in 2019. The sector’s contribution to Scotland’s overall FDI figures also increased from 7.4% in 2018 to 7.9% last year.

Sue Dawe, EY’s Head of Financial Services in Scotland, said: “In a year where both Europe and the UK experienced a fall in their numbers of financial services foreign investment projects, it is positive to see Scotland demonstrating relative resilience and bucking the trend with an increase in project numbers.”

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