Milestones: Uk Tops Foreign Direct Investment League Table

United Kingdom

By Anita Hawser


London calling: Investors’ faith in the UK is growing

The largest investor in the UK remained the United States, which increased its investment by 30% on 2007-2008 levels. The US accounted for more than 35% of total UK FDI in 2008-2009, with drug company Pfizer announcing that it would invest $60 million in a stem cell research center in Cambridge. India increased its investment in the UK by 44%, moving up from seventh-largest investor in 2007-2008 to second-largest investor in 2008-2009. Other countries that increased their investment into the UK include Italy (up 45%), France (up 15%), Canada (up 25%) and the Gulf (up 25%).

Most investment growth was in new projects (827 in total), which increased by 26% on 2007-2008. Acquisitions, joint ventures and mergers declined 6%, attracting a total of 457 projects in 2008-2009. The third-biggest area of investment was company expansions (460 projects), which increased by 5% in 2008-2009.

Most foreign investment in terms of projects was centered on software (306 projects), advanced engineering (211 projects) and information and communication technology (152 projects). The UK’s beleaguered financial services sector accounted for 130 FDI projects in 2008-2009, an increase of 20%. And despite the threat of increased regulation of financial services, foreign banks continued to set up operations in the UK, with China Construction Bank choosing it as the location for its European headquarters and The Bank of New York Mellon expanding its global custody operations in Mancheste.


With investors shying away from UK gilts and sterling, Britain does not stand out as a likely global leader among investment locations. However, a report published by UK Trade & Investment (UKTI) shows that the United Kingdom remained the top investment location in Europe in the year to March 2009, securing a record 1,744 inward investment projects. According to the report, in 2008-2009 the UK attracted FDI from 53 countries, up from 48 the previous year.