Last week UNCTAD released their World Investment Report 2012.
UK Inward and outward Foreign Direct Investment (FDI) flows increased in 2011. UK inward FDI increased slightly in 2011, rising to 15.6% of gross fixed capital formation (GFCF). Outward FDI almost tripled to over $100 billion and 31% of GFCF, rising from 12% in 2010. Outward FDI is now much closer to the annual pre-crisis average seen from 2005 to 2007 in both $ terms and % of GFCF, inward FDI remains well below the pre-crisis level and is more in line with other developed economies.
We might start to see more inward investment as the UK is becoming more attractive as a place to invest. Transnational Corporation (TNC) executives ranked the UK 6th equal with Australia as a top investment destination for the period 2012-2014, up from 13th in 2011. The top five ranked countries were China, the US, India, Indonesia and Brazil.
Manufacturers globally have the strongest investment plans. 60% of Manufacturing TNCs indicated they plan to increase FDI expenditure in 2012 from their 2011 levels compared to 45% in the Primary sector and 43% in Services.