According to new figures from EY, foreign investment into the UK fell behind France for the fifth consecutive year in 2024, highlighting the ongoing struggle to attract overseas capital since the 2016 Brexit vote.
The EY Attractiveness Index revealed that the UK secured 853 foreign direct investment (FDI) projects last year, trailing France’s 1,025 and ahead of Germany’s 608. Since 2014, France has increased its number of FDI projects by 50%, taking the top spot in Europe, while the UK has steadily declined.
EY, which has tracked FDI trends for over twenty years, said the UK secured 352 fewer projects in 2024 than at its peak in 2017, when 1,205 were secured.
The report also found that Europe’s three major economies—France, the UK and Germany—have all struggled to attract foreign investment post-pandemic. Compared to 2023, the UK saw a 13% drop in projects, France fell 14%, and Germany 17%. Across Europe, FDI declined by 5% in 2024, primarily driven by a slowdown in U.S. capital flows, down 11% for continental Europe and 7% for the UK.
The downturn has sharpened focus on the UK government’s efforts to mobilise domestic investment. Earlier this week, 17 of the country’s largest pension funds agreed to unlock up to £50 billion in investment, with at least half directed toward UK-based projects such as clean energy and tech startups.
There were some bright spots in the EY report. Greater London retained its status as Europe’s top region for inward investment for the second year running, and the UK led the continent in tech-related FDI, accounting for 20% of all European tech projects in 2024.
EY’s UK chief economist, Peter Arnold, said the country could rebound in the year ahead, citing stable political conditions and a renewed focus on higher-value investment.
“Global uncertainty makes forecasting difficult, but the UK has some strong fundamentals,” Arnold said. “With a stable government and a shift toward high-value sectors like R&D and manufacturing, the country is well-positioned to attract long-term investment.”
