Britain and Germany have topped the annual ranking of foreign investment projects in Europe, it was announced on Tuesday, as France lagged far behind.
Britain is retaining the position it holds from the previous year as it saw its number of foreign investment projects rise by a whopping 15 per cent last year to 799, according to accounting firm Ernst and Young.
At the same time, Germany, Europe’s biggest economy and powerhouse of industrialism saw a 12 per cent increase to 701 foreign investments, trailing Britain by 98 for the top spot.
France appears to have temporarily halted some of the decline it has faced in recent years, although the number of foreign investments grew significantly less quickly than in either Germany or Britain.
With a year-on-year increase of nine per cent, up to 514 projects, Arnaud Montebourg, French Economy Minister, chose to portray the study as a sign of the government’s success in revitalising French firms’ competitive edge and improving the country’s attractiveness.
President Francois Hollande aims to eradicate 30 billion in payroll tax companies pay over the next three years, in return for companies commitments to contribute and create thousands of new jobs.
Ernst and Young have stated that the total number of foreign investments in Europe rose five per cent to a record 3,955 projects, helping to create over 165,000 jobs which although large, is still lower than pre-crisis levels of approximately 200,000 jobs.
Whilst intra-European investment accounted for 54 per cent of foreign investments, the US was the world’s single biggest investor , followed closely by European giants Britain and Germany.
To highlight the United States’ attraction to European investment, US conglomerate company General Electric is now seeking to buy the energy branch of French assets group Alstom, once an iconic figure in French industry. This move is not very popular in France, with the government showing resistance as it prefers a European merger with German rival Siemens and is trying to widen its control of foreign takeover deals with a newly implemented law handing them the power to veto deals which are not in their interests.
Reginald Green, of Emerald Knight Consultants, a leading investment consultancy says that Britain’s position at the top of the table is both a blessing and a curse.
“From one point of view, the positives of being at the top of the table are clear to see, more investment means more money being pumped into the economy, and that means companies have money to pay better wages, get better facilities and ultimately help to consolidate the strength of the pound versus the euro and the dollar”
“However,” he added “more foreign investment means that domestic investors are losing out on investment opportunities as big foreign companies with more money and more status come in and immediately pick up any potential big money investments. Pretty soon we could find ourselves in a situation where not many people are investing in their own country and this could lead to the decline of some privately owned services”.
Bradley Shore is an experienced property and investment blogger; his main interests are foreign property investment as you can see in his recent work for Emerald knight consultants, Bradley Shore likes to try influence and guide his readers in the right direction when investing.