EY report reveals foreign investment is continuing to flow into the region.
Manchester remains a top place for foreign direct investment in the region outside of the capital.
According to EY’s latest UK Attractiveness Survey, the north west region attracted 90 foreign direct investment (FDI) projects in 2016 – 60 per cent of which were first time investments in the region from international investors.
But Greater Manchester continues to dominate the region in terms of FDI attracting 70 projects.
Cheshire secured nine FDI projects in 2016 and Merseyside eight projects.
Once again Manchester topped the UK league tables as the city attracting most FDI outside of London in 2016, with 47 projects, compared to 20 in Birmingham and 12 in Leeds.
These include US-based XPO Logistics taking over 237,000 sq ft of warehouse space in Trafford Park, Jonckers, a Belgium-based translation services, expanded its UK operation with a Manchester office, while Israeli firms Fibonatix, a fintech specialist, and advertising agency Sanabil Digital launched offices in Manchester and Salford respectively.
Financial & business services, and manufacturing investors dominated FDI in the region with 36 and 35 projects respectively.
The majority of investment in the region came from Europe – with 42 projects coming from this trade area – followed by North America with 27 projects.
On an individual country basis, the USA was the biggest investor in the north west region with 25 projects, followed by Germany and France, who both brought in 10 projects.
There were four projects apiece from Israel, Denmark and Australia.
In all, the survey said FDI in the north west was generated from 26 different countries across the globe.
Bob Ward, North West Senior Partner at EY said: “The work that has taken place to position the North West, and indeed, the whole of the North of England, as a strong investment location in the global marketplace is starting to pay off. These figures show that the international investment community sees the potential in the region, with its access to the right skills, infrastructure and strong supply chain networks.”
The report also revealed that 61 per cent of all FDI projects in the region were announced before the EU Referendum vote, with 39 per cent announced after this date.
When global investors were asked about the future attractiveness of the UK their views were mixed.
Thirty-two per cent of respondents, surveyed between March and April 2017, say they expect the UK’s attractiveness to FDI to improve over the coming three years, while 31 per cent expect it to decline.
Both figures are significantly worse than recorded long-term averages.
In fact, since March 2016 the share of investors with a negative view of the UK’s medium term prospects for FDI have almost doubled.
Mark Gregory, EY’s chief economist says: “The research suggests that the EU Referendum vote and its aftermath may be having an influence on global perceptions of the UK’s medium to long-term attractiveness. Western European investors are twice as negative as Asian and North American investors.
“Decisions on the majority of investments made in 2016 would have been made up to three years ago, which helps to explain the UK’s solid performance last year, but signs of a slowdown are on the horizon.”
Although London remained the UK’s dominant location for FDI, the Northern Powerhouse and the Midlands Engine, continued to do well attracting roughly double the number of projects they secured at the beginning of the last decade.
Tim Newns, chief executive of MIDAS, Manchester’s inward investment agency, part of MGC, said: “Greater Manchester has a clear International Strategy, with focus on six key international markets and four sectors.
“This continuing focus and the partnership approach that exists amongst the public, private and education sectors across the city region is the linchpin of this success.
“The value of this investment also continues to rise with GM seeing increasing capital investment, such as the recent investment from FEC, and growing interest in the region’s innovation economy as more companies consider the region as a strong destination for R&D, driven by the strengths of the universities.
“Greater Manchester’s enviable access to talent is also proving a significant asset. Four universities offering world-class higher education to over 100,000 students, plus a further 22 universities and HE institutions within an hour’s drive, make the region a lure for large international companies.”