Britain saw the number of overseas-funded projects decline by around 6% in 2022, but still attracted the second-largest amount of foreign money in Europe, according to new research.
Some 929 Foreign Direct Investment (FDI) projects were started in the UK in in 2022, against 993 in 2021, the survey from E&Y found.
France attracted the most investment with Germany third behind the UK, though across Europe the UK’s share dropped to 15.6% from 16.9% in 2021.
One reason for the drop was a 23% decline in tech projects, but the UK still ranked ahead of Europe in the tech sector, though its share of digital projects fell from 29.2% in 2021 to 19.8% last year.
Predictions that Brexit might spark a slump in new projects seem not to have materialised as overall the UK ranked highest in Europe for new projects and continued to deliver more total jobs and jobs per project than Germany and France, E&Y said.
Alison Kay, managing partner for client service at EY UK & Ireland, commented: “Europe had a challenging 2022 for inward investment, with overall projects broadly flat.
"But, digging into the detail, the UK has a strong investment story to tell.
“Investment intentions are at a record high and almost half of the investors surveyed think the UK’s attractiveness will improve in the near term.
“Significantly, the UK’s clear focus on project value over volume continues to bear fruit.
“While the UK is behind France on the total number of projects, it is Europe’s clear leader when it comes to strategically important FDI."
Peter Arnold, EY’s UK chief economist, added: “The UK’s tech sector typifies the country’s overall performance: project numbers are down but value remains solid with smaller projects not being prioritised.”