Brexit Worries 'Could See UK Lose Top European Spot For Foreign Investment'

Brexit Worries 'Could See UK Lose Top European Spot For Foreign Investment'

The UK risks losing its position as the top European destination for foreign investment amid concerns over Brexit, a report said.

The nation held on to the top spot last year after the number of foreign direct investment (FDI) projects rose by 7% to 1,144, according to accountancy giants EY.

But the study found that 31% of investors expect the UK's attractiveness for FDI to decline over the next three years.

Meanwhile, 9% said Britain's exit from the European Union would cause them to shift their investment plans from Britain to Europe.

Mark Gregory, EY's chief economist, said: "The research suggests that the EU referendum vote and its aftermath may be having an influence on global perceptions of the UK's medium to long-term attractiveness.

"Western European investors are twice as negative as Asian and North American investors.

"Decisions on the majority of investments made in 2016 would have been made up to three years ago, which helps to explain the UK's solid performance last year, but signs of a slowdown are on the horizon."

Despite some Brexit concern from investors, 32% believe Britain's FDI attractiveness will improve over the next three years.

It came as the European market saw its best year for international investment since the financial crisis, with the number of FDI projects climbing 15% to 5,845 in 2016.

Germany poses a threat to the UK's dominance after seeing a 12% jump in FDI projects last year.

It also boosted its share of all the FDI projects coming into Europe by 0.5%, while the UK saw its share fall by 2%.

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