According to new report
One year on from the referendum, the UK financial services industry has retained its title as Europe’s most attractive location for international investment – in 2016 it secured its highest level of foreign investment for over a decade, according to EY’s latest study of Financial Services’ Attractiveness. Investor sentiment is, however, becoming more mixed on the longer term outlook for UK Financial Services, due to concerns over the impact of Brexit on the future attractiveness of the UK.
The UK financial services industry attracted 99 foreign direct investment (FDI) projects in 2016, the highest level since 2006 – an increase of 5 per cent on the previous year. Whilst it has hung onto its number one spot by a sizeable margin, the gap is starting to narrow. Germany, in second place, recorded 39 financial services projects (up 18 per cent year on year) and France, in third place, registered 25 projects (up 25 per cent on 2015).
Omar Ali, EY’s UK financial services leader, said: “Despite the referendum, UK financial services continued to attract record levels of investment last year. However, the outlook for 2017 and 2018 isn’t so certain. We can see from our study that investors have concerns about what Brexit may mean for the future and they want greater clarity on corporate taxation and incentives for foreign investors.
“That the attractiveness of the UK financial services sector has not yet fallen is testament to the strength of the UK’s unique financial ecosystem. We have to be realistic though, our study of investor sentiment is showing they are concerned about the outcome of Brexit negotiations and their confidence will have been shaken further by recent political events. It’s vital that the Government does all it can to articulate a clear strategy around skills, market access and future trading arrangements to ensure the UK continues to be Europe’s preeminent financial centre for many years to come.”
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