Why are foreign investments in the UK rising?

Is it just the weather?

There is some good news for the UK taxman this summer. First, the country actually had a summer. It even fell on a Sunday, as a colleague pointed out. Second, according to the Office for National Statistics, this year Brits are happier. The Jubilee played its part, a report suggests.

And this is not all: while Jubileeing first and waiting for RB immediately afterwards, foreign investments have also increased, according to the Inward Investment Report 2012/2013 presented by government agency UK Trade & Investment (UKTI).

The UKTI says that while global Foreign Direct Investment inflows declined by 18 per cent, inflows into the UK experienced a 22 per cent year on year increase.

"The UK has received a major vote of confidence from foreign investors confirming that the UK remains a world leading business destination,” says Trade and Investment Minister Lord Green, adding that "attracting foreign investment is an important element of the UK Government’s economic and growth programme."

Between Olympic and Royal fever the UK reached the peak of its marketing capabilities in the past two years. But what supported this powerful business card?

The World Bank ranks the UK among the top countries for ease of doing business. It considers elements such as the 13 days on average to set up a business or the 24 hours necessary to register a company.

The UKTI claims that the removal and reduction of "red tape’" has already saved UK-based businesses approximately £1bn in the last two years. It also highlights the advantages of a flexible labour market and of a "highly competitive tax environment", with the main rate of corporation tax being reduced to 21 per cent in 2014 and 20 per cent in 2015 – the lowest rate in the G7 and the joint lowest in the G20.

A sunny picture to indulge in during the summer.

The strengths of this chapter of the UK economy are reflected in the identikit of its main investors: North America and Japan, but also India and China, across very different sectors. Altogether Britain has attracted 1,559 projects, 11 per cent more than the previous year and the UKTI estimates these investments have generated 170,000 jobs.

Foreigners are particularly keen in investing in software and computer services, which, with 17 per cent of projects, represent the largest slice of the cake. Financial and business services are the second most attractive, but the broad range of investments includes creative and media services, biotechnology and pharmaceuticals and renewable energy.

Emerging economies are investing from scratch and buying British companies, but it’s the comparison with other EU member states that can work as a litmus test of the real strengths of the Brits.

Investments from French and German companies have increased by 43 and 18 per cent respectively.

Despite a 5 per cent reduction, Italy is, together with France, the third foreign investor.

Italians are attracted by the political and economic stability. No wonder, as the waiting for the Royal Baby has been equalled only by the waiting in the past days for the outcome of the final sentence on former PM Berlusconi.

A legislation that encourages innovation is also considered a reason to invest in the UK, together with an open market that makes it easy to access talent.

"Italian companies increasingly see the UK as the ideal destination to grow, succeed and access international opportunities. The exceptional Italian results reflect the capacity for recovery of the country and of its profound entrepreneurial roots, as well as its industrial excellence," says British consul for Milan Vic Annels.

This sounds a bit as if we’ve got it all, apart from a couple of fundamental things, but as our governments are busy at the moment, we’ll come at yours.

Interestingly, the reasons given to support this choice highlight some historical weaknesses of other European countries (it is probably worth mentioning that the UK is in Europe as well) and some historical strengths of the British system more than a renewed economic epiphany.

So, after all this sun, let’s not forget the role of rain in growing awareness: the UK has been dynamic and successful in attracting foreign investors. But this is only a chapter of the economy and the Royal baby is going to cry a lot before becoming a king.

Photograph: Getty Images

Sara Perria is the Assistant Editor for Banking and Payments, VRL Financial News

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The economics of outrage: Why you haven't seen the end of Katie Hopkins

Her distasteful tweet may have cost her a job at LBC, but this isn't the last we've seen of Britain's biggest troll. 

Another atrocity, other surge of grief and fear, and there like clockwork was the UK’s biggest troll. Hours after the explosion at the Manchester Arena that killed 22 mostly young and female concert goers, Katie Hopkins weighed in with a very on-brand tweet calling for a “final solution” to the complex issue of terrorism.

She quickly deleted it, replacing the offending phrase with the words “true solution”, but did not tone down the essentially fascist message. Few thought it had been an innocent mistake on the part of someone unaware of the historical connotations of those two words.  And no matter how many urged their fellow web users not to give Hopkins the attention she craved, it still sparked angry tweets, condemnatory news articles and even reports to the police.

Hopkins has lost her presenting job at LBC radio, but she is yet to lose her column at Mail Online, and it’s quite likely she won’t.

Mail Online and its print counterpart The Daily Mail have regularly shown they are prepared to go down the deliberately divisive path Hopkins was signposting. But even if the site's managing editor Martin Clarke was secretly a liberal sandal-wearer, there are also very good economic reasons for Mail Online to stick with her. The extreme and outrageous is great at gaining attention, and attention is what makes money for Mail Online.

It is ironic that Hopkins’s career was initially helped by TV’s attempts to provide balance. Producers could rely on her to provide a counterweight to even the most committed and rational bleeding-heart liberal.

As Patrick Smith, a former media specialist who is currently a senior reporter at BuzzFeed News points out: “It’s very difficult for producers who are legally bound to be balanced, they will sometimes literally have lawyers in the room.”

“That in a way is why some people who are skirting very close or beyond the bounds of taste and decency get on air.”

But while TV may have made Hopkins, it is online where her extreme views perform best.  As digital publishers have learned, the best way to get the shares, clicks and page views that make them money is to provoke an emotional response. And there are few things as good at provoking an emotional response as extreme and outrageous political views.

And in many ways it doesn’t matter whether that response is negative or positive. Those who complain about what Hopkins says are also the ones who draw attention to it – many will read what she writes in order to know exactly why they should hate her.

Of course using outrageous views as a sales tactic is not confined to the web – The Daily Mail prints columns by Sarah Vine for a reason - but the risks of pushing the boundaries of taste and decency are greater in a linear, analogue world. Cancelling a newspaper subscription or changing radio station is a simpler and often longer-lasting act than pledging to never click on a tempting link on Twitter or Facebook. LBC may have had far more to lose from sticking with Hopkins than Mail Online does, and much less to gain. Someone prepared to say what Hopkins says will not be out of work for long. 

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