Brexit has ‘chilled’ business investment, says Bank of England deputy governor

[pellinore]

A key driver for economic growth, business investment was now only 6% higher in real terms than in the second quarter of 2016, when the Brexit referendum was held, Ramsden said. “That’s less than 1% a year. Over that time, US business investment has gone up by over 25%,” he said.

“You can see a break in the trend for UK business investment in 2016. It had been going up since the global financial crisis and then it flattened off from 2016 onwards.”

The Bank’s deputy governor said certainty was a key driver of business investment decisions, suggesting it had been lacking in recent years. “Ideally you want low and stable inflation but also you want certainty around where fiscal policy is going, and certainty about what the kind of relationships your economy is going to have.”

Brexit has ‘chilled’ business investment, says Bank of England deputy governor (msn.com)

Edited November 21, 2023 by pellinore

[L.A.T.1961]

And yet -

The UK remains second in EY’s annual ranking of European countries by their ability to attract Foreign Direct Investment (FDI) projects, according to the EY 2023 UK Attractiveness Survey, despite activity falling in 2022.

France held onto top spot for total project numbers for a fourth consecutive year, although the UK once again ranked highest in Europe for new projects and continued to deliver more total jobs and jobs per project than Germany and France – trends consistent with the UK’s pivot in strategy to focus on value over volume when attracting FDI.

Alison Kay, Managing Partner for Client Service at EY UK & Ireland, comments: “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. Over one-in-four UK projects were linked to Research & Development or new company headquarters 

https://www.ey.com/en_uk/news/2023/06/foreign-direct-investment-uk-remains-second-in-europe-despite-a-fall-in-project-numbers

[+OverSword]

Quote

Brexit has ‘chilled’ business investment, says Bank of England deputy governor

Better get in now while it's affordable.

[pellinore]

5 minutes ago, L.A.T.1961 said:

And yet -

The UK remains second in EY’s annual ranking of European countries by their ability to attract Foreign Direct Investment (FDI) projects, according to the EY 2023 UK Attractiveness Survey, despite activity falling in 2022.

France held onto top spot for total project numbers for a fourth consecutive year, although the UK once again ranked highest in Europe for new projects and continued to deliver more total jobs and jobs per project than Germany and France – trends consistent with the UK’s pivot in strategy to focus on value over volume when attracting FDI.

Alison Kay, Managing Partner for Client Service at EY UK & Ireland, comments: “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. Over one-in-four UK projects were linked to Research & Development or new company headquarters 

https://www.ey.com/en_uk/news/2023/06/foreign-direct-investment-uk-remains-second-in-europe-despite-a-fall-in-project-numbers

The article you quote says, in effect, things are not good for the UK, but there are lots of poitives we can look at- at bit like the report a kid gets in school when he is failling but you want to encourage hime:

The UK recorded 929 Foreign Direct Investment (FDI) projects in 2022, down 6.4% from 993 in 2021 – France continued to lead Europe with Germany ranked third

Total FDI projects in Europe were up just 1.4% in 2022 – with the UK’s share of the European inward investment market down to 15.6% from 16.9% in 2021

But the UK performed well on project value, delivering the highest jobs total in Europe, more jobs per project than Germany or France, a strong R&D performance, and Europe’s most ‘new’ projects

UK tech FDI projects were down 32.2% in 2022 – a key factor in the UK’s overall project decline – but the UK still led Europe in the tech sector

All Northern regions, the East Midlands, the East of England and Wales saw Foreign Direct Investment (FDI) project numbers rise by 10% or more year-on-year in 2022

London recorded 299 FDI projects in 2022, down 24% from 394 in 2021, marking the capital’s lowest number of projects in the last ten years – although London remained the UK’s #1 location for FDI projects

As the BoE says, all is not over for the UK, it is just damaged. We can't get away from it, isolating ourselves is damaging economically. Still, at least we have put a stop to immigration now we control our borders. Or increased it by about four times, I forget which. And we are enjoying lower personal taxes and a higher standard of living- or is it the highest taxes in 70 years and a cost-of-living crisis? One or the other, anyway.

[L.A.T.1961]

The BoE forecasts have proved wrong more often than not. If Ramsden's views were used to make these forecasts then we can see why they are predictably pessimistic. He's obviously not seen the phrase there's more then one way to skin a rabbit. 😉

And when is comparing UK to the US a logical thing to do, everybody does less well in comparison to the US and their huge economy.

Ramsden's comments have to be seen as deliberately biased against the UK and brexit. Which they are.

Not something a bank of England deputy governor should indulge in as his viewpoint will be ignored by financial professionals.

Maybe he should be comparing the UK to the German powerhouse that takes full advantage of it's EU membership.

 

 "Germany’s finance ministry has imposed a spending freeze on all federal ministries, deepening a budget crisis that has rocked the ruling coalition since a bombshell ruling by the country's top court last week.

The finance ministry decision, which halts most new spending authorizations, followed a ruling by the constitutional court last week that blew a €60 billion hole in the government's coffers.

The government's inability to find the money it needs to finance its sweeping agenda to accelerate the green transition and shield German industry from high energy costs is leading to growing calls, particularly on the political left, for the government to suspend the debt brake by declaring an emergency, as it did during the coronavirus pandemic and in the aftermath of Russia's full-scale invasion of Ukraine."

https://www.politico.eu/article/germany-freeze-spending-budget-crisis-deepen/

[KeithSwartz]

On 11/21/2023 at 9:31 PM, L.A.T.1961 said:

The BoE forecasts have proved wrong more often than not. If Ramsden's views were used to make these forecasts then we can see why they are predictably pessimistic. He's obviously not seen the phrase there's more then one way to skin a rabbit. 😉

And when is comparing UK to the US a logical thing to do, everybody does less well in comparison to the US and their huge economy.

Ramsden's comments have to be seen as deliberately biased against the UK and brexit. Which they are.

Not something a bank of England deputy governor should indulge in as his viewpoint will be ignored by financial professionals.

Maybe he should be comparing the UK to the German powerhouse that takes full advantage of it's EU membership.

 

 "Germany’s finance ministry has imposed a spending freeze on all federal ministries, deepening a budget crisis that has rocked the ruling coalition since a bombshell ruling by the country's top court last week.

The finance ministry decision, which halts most new spending authorizations, followed a ruling by the constitutional court last week that blew a €60 billion hole in the government's coffers.

The government's inability to find the money it needs to finance its sweeping agenda to accelerate the green transition and shield German industry from high energy costs is leading to growing calls, particularly on the political left, for the government to suspend the debt brake by declaring an emergency, as it did during the coronavirus pandemic and in the aftermath of Russia's full-scale invasion of Ukraine." These factors are highly interconnected and are pivotal for a business's success. Additionally, having the appropriate strategy is imperative for competing on the international stage. I've discovered and this site that can provide assistance in this area. After an extensive search for offshore corporate services specialists, I'm relieved to have finally found a reliable option

https://www.politico.eu/article/germany-freeze-spending-budget-crisis-deepen/

Thank you for sharing this with us!

Edited April 28 by KeithSwartz

[Duke Wellington]

On 11/21/2023 at 5:30 PM, pellinore said:

A key driver for economic growth, business investment was now only 6% higher in real terms than in the second quarter of 2016, when the Brexit referendum was held, Ramsden said. “That’s less than 1% a year. Over that time, US business investment has gone up by over 25%,” he said.

“You can see a break in the trend for UK business investment in 2016. It had been going up since the global financial crisis and then it flattened off from 2016 onwards.”

The Bank’s deputy governor said certainty was a key driver of business investment decisions, suggesting it had been lacking in recent years. “Ideally you want low and stable inflation but also you want certainty around where fiscal policy is going, and certainty about what the kind of relationships your economy is going to have.”

Brexit has ‘chilled’ business investment, says Bank of England deputy governor (msn.com)

Divorced from reality lol

[adamjones]

On 11/21/2023 at 8:38 PM, L.A.T.1961 said:

And yet -

The UK remains second in EY’s annual ranking of European countries by their ability to attract Foreign Direct Investment (FDI) projects, according to the EY 2023 UK Attractiveness Survey, despite activity falling in 2022.

France held onto top spot for total project numbers for a fourth consecutive year, although the UK once again ranked highest in Europe for new projects and continued to deliver more total jobs and jobs per project than Germany and France – trends consistent with the UK’s pivot in strategy to focus on value over volume when attracting FDI.

Alison Kay, Managing Partner for Client Service at EY UK & Ireland, comments: “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. Over one-in-four UK projects were linked to Research & Development or new company headquarters. 

https://www.ey.com/en_uk/news/2023/06/foreign-direct-investment-uk-remains-second-in-europe-despite-a-fall-in-project-numbers

It’s impressive to see the UK maintaining a strong position in attracting FDI, especially with a strategic focus on high-value projects like Research & Development.

Edited August 24 by adamjones

[L.A.T.1961]

1 hour ago, adamjones said:

It’s impressive to see the UK maintaining a strong position in attracting FDI, especially with a strategic focus on high-value projects like Research & Development.

Hi and welcome, here are some more up to date numbers. The UK is still moving along nicely. 😉

Thu, Jul 11, 2024-

The UK remains second in EY’s annual ranking of European countries by their ability to attract Foreign Direct Investment (FDI) projects and was the only country in the top three to see project numbers increase year-on-year.  France ranked first in Europe for the fifth consecutive year, while Germany followed in third place, according to the EY 2024 UK Attractiveness Survey. The UK was home to 985 FDI projects in 2023, which was a 6% increase from 2022.

https://finance.yahoo.com/news/foreign-direct-investment-uk-project-135528509.html