A year after the Brexit vote the UK remains Europe’s top financial services location for investors, but investor sentiment is mixed over the longer term outlook due to concerns over the effect of Brexit, according to EY’s study of financial services attractiveness.
The study found that UK financial services attracted 99 foreign direct investment (FDI) projects in 2016, the highest level for over a decade, up 5% on the previous year.
But the lead over other countries is starting to narrow with Germany recording a year on year increase of foreign direct investment projects in 2016 of 18% and France a 25% increase.
Nearly three quarters of financial services investors believe the FinTech sector makes the UK more attractive as an FDI destination. But almost half were concerned about a loss of access to EU markets and over a third were concerned about tariffs on exports.
Omar Ali, EY’s UK financial services leader, said: “We can see from our study that investors have concerns about what Brexit may mean for the future and they want greater clarity on corporate taxation and incentives for foreign investors. Our study of investor sentiment is showing they are concerned about the outcome of Brexit negotiations and their confidence will have been shaken further by recent political events. It’s vital that the Government does all it can to articulate a clear strategy around skills, market access and future trading arrangements to ensure the UK continues to be Europe’s preeminent financial centre for many years to come.”
©2017 funds europe
