Britain named best in Europe for investment
Britain once again surpasses rivals to be named Europe’s most attractive destination for investment in foreign financial services
- The UK attracted 76 financial services projects in 2022
- Well ahead of closest competitor France at 45
- Still worried about how to restore City’s priority as a list destination
Britain has once again outsmarted its rivals to be named Europe’s most attractive destination for investment in foreign financial services.
The UK attracted 76 financial services projects in 2022, well ahead of closest competitor France with 45, as it shrugged off post-Brexit attempts to steal its crown, according to an EY report.
It stems from concerns about how the city can regain its pre-eminent position as a global listing destination after a series of companies moved to the US.
There are also new fears that the UK’s ‘punitive’ tax regime is not helping.
Anna Anthony, UK financial services managing partner at EY, said: ‘The strength of the UK financial market has led investors to view it as the most attractive European financial services market, even in difficult times.
Attractive destination: the UK attracted 76 financial services projects in 2022, well ahead of competitor France at 45
“Our research shows that investors recognize the strength, gold-standard governance and resilience of the UK financial system and see it as the destination of choice for growth, innovation and access to top talent.”
The figures refer to the number of financial services projects during the year in which a foreign company invests by establishing a new operation or expanding an existing one.
Over the last decade, the UK has consistently beaten European rivals, with a total of 819 projects ahead of France and Germany combined.
It comes amid growing fears about the city’s future. Cambridge-based chip designer Arm’s decision to go public in New York came as a blow. A Swedish-led takeover of veterinary drug maker Dechra contributed to a series of companies leaving London.
Ex-London Stock Exchange chief Xavier Rolet said reforms risked becoming an afterthought without changes to a “punitive fiscal and regulatory framework”. He told The Sunday Telegraph: ‘We need a recalibration. We need to reduce the quadruple taxation of shares in the UK.
“We have dividend tax, capital gains tax, income tax and a stamp duty transaction tax, of which the UK has the highest rate in all of Europe. The same pound of income from stocks is taxed four times.
“You have a regulatory framework that forces long-term investors… to effectively short the real economy by avoiding investing in the stock market.”