FDI in the U.K.
FDI in Figures
According to the World Investment Report 2010 of the United Nations Conference on Trade and Development (UNCTAD), the United Kingdom is the fifth highest recipient of direct foreign investment (FDI) in the world. In 2008-2009, FDI flow was on the decline and this trend should continue in the coming years. FDI flux decreased sharply since the international financial crisis and should remain low in the coming years.
The UK nevertheless has real strengths: London still seems to be Europe's financial capital. Furthermore, Great Britain has a strong currency and one of the most important European markets.
|Foreign Direct Investment||2007||2008||2009|
|FDI Inward Flow (million USD)||186,381||91,487||45,676|
|FDI Stock (million USD)||1,242,949||980,920||1,125,066|
|Performance Index*, Ranking on 141 Economies||51||78||73|
|Potential Index**, Ranking on 141 Economies||3||8||-|
|Number of Greenfield Investments***||683||873||1,036|
|FDI Inwards (in % of GFCF****)||37.4||20.5||29.0|
|FDI Stock (in % of GDP)||44.4||36.8||51.7|
Note: * The UNCTAD Inward FDI Performance Index is Based on a Ratio of the Country's Share in Global FDI Inflows and its Share in Global GDP. ** The UNCTAD Inward FDI Potential Index is Based on 12 Economic and Structural Variables Such as GDP, Foreign Trade, FDI, Infrastructures, Energy Use, R&D, Education, Country Risk. *** Green Field Investments Are a Form of Foreign Direct Investment Where a Parent Company Starts a New Venture in a Foreign Country By Constructing New Operational Facilities From the Ground Up. **** Gross Fixed Capital Formation (GFCF) Measures the Value of Additions to Fixed Assets Purchased By Business, Government and Households Less Disposals of Fixed Assets Sold Off or Scrapped.
FDI Inflows By Countries and Industry
|Main Investing Countries||2009, in %|
|Main Invested Sectors||2009, in %|
|Trade and maintenance||32.8|
|Electricity, water, gas||6.2|
|Real estate, rent, business services||4.2|
Source: National statistics
- Main Foreign Companies
- Recently many UK companies have been acquired by foreign companies: Chivas Brothers by Pernot Ricard (France), Aggregate Ind by Holcim (Switzerland), Paladin Ressouces by Talisman Energy (Canada), Body Shop by L'Oréal (France), etc.
- Sources of Statistics
Department of innovation, universities and skills
Why You Should Choose to Invest in the United Kingdom
- Strong Points
- One of the United Kingdoms main strong points is the speed of formalities: only thirteen days are required to set up a company in the United Kingdom, compared to the European average of 32 days, which puts the country in first place in Europe and sixth place in the world. Low taxation makes the environment investor-friendly. London is the world's leader in terms of financial services centers, on a number of key performance indicators and was once again voted best European city by the European Cities Monitor, which studies the appeal of cities .
- Weak Points
- The country's main weak points are: the financial sector's excessive influence on the GDP, poor quality infrastructures and a high level of competitiveness from foreign companies in the industrial sector.
- Government Measures to Motivate or Restrict FDI
- Once foreign companies are established in the UK, they are treated exactly like British firms. Within the EU, the British Government is a strong defender of any British registered company's rights, irrespective of its nationality or the nationality of its owner.
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