By Anita Hawser
London calling: Investors’ faith in the UK is growing
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.