The UK fell behind France in attracting foreign investment again last year as Emmanuel Macron battles to win more business with the City.
The gap between the number of foreign investment projects sealed in the UK and France widened after Mr Macron’s drive to attract deals through business-friendly policies.
France was the top destination for foreign investment in Europe in 2021 with 1,222 projects, up 24% on the previous year to mark a record for the region, according to EY’s annual attractiveness survey .
Investments in the UK, meanwhile, rose 1.8% to 993 projects while Germany took third place after suffering a 10% drop to 841 projects.
France stole the UK’s investment crown in 2019 after Mr Macron launched a charm offensive to woo businesses after Brexit, including tax cuts and labor market reform. The French president has made repeated efforts to attract financial services from London and has held investment summits to capitalize on Brexit uncertainty.
Peter Arnold, UK chief economist at EY, said: “Macron has been very successful in presenting France as a location for foreign investment.
“Since Macron’s election and after the Brexit vote in 2016, you have seen a better performance from France.”
However, EY said investments guaranteed by the UK were generally larger and created more jobs than France in 2021.
Mr Arnold said the gap would narrow between Britain and France as confidence in the UK improved following the Brexit deal.
He said: “The UK is in a pretty strong position and certainly since the signing of the EU-UK trade and cooperation agreement we have seen a big increase in the UK’s net attractiveness score. United. Investors see it as a return to what it was before Brexit.
Mr Arnold added: “There is now certainty around leaving the EU. I think leaving Covid we can be reasonably confident that investment will come back and we will see further recovery in 2022.”
Investment Minister Lord Grimstone said the survey showed that “the UK’s focus on high-value investment with job creation at its heart has been successful”.
He added: “Rising levels of investment outside of London demonstrate that our upgrade ambitions are having a real impact. I am confident that our modern and comprehensive trade agreements will continue to make our country an exceptional investment location for years to come.