The much-heated discussion about the UK’s exit from the EU is providing great fodder for news headlines. However, expert’s advice that for the discerning business investor, this is all merely background noise. It will not prevent the continued foreign expansion and investment in the UK as recent indicators seem to suggest that trust in the UK economy is stronger than ever.
There is a great deal of factual evidence to support that confidence as we will now show.
Britain is still the primary focus of business immigration for companies seeking a European base. In fact, its status as Europe’s most attractive overseas investment location has not been this strong since 2005, before the financial crisis.
The Organisation for Economic Co-operation and Development (OECD) has announced that UK FDI inflows rose to $253.7bn (£197bn) in 2016. This is an increase of £33bn from 2015.
So why is the UK still a strong draw for business immigration?
Some of the sums behind that impressive FDI figure come from huge cross-global deals, and major companies choosing to set up operations in Britain or to expand here.
Months after the vote to leave the EU, Apple announced its new European HQ would be in Battersea Power Station, London. Nissan revealed that production of two new car models would be based at its site in Sunderland. Google, IBM and Facebook increased staffing and data centres in the UK.
Snapchat also chose London to be its international base of operations outside the US at the start of this year and there have been huge investments in UK production facilities from Boeing (£20m in Sheffield) and Toyota (£240m in Derbyshire).
All proving the theory that the UK is fertile ground for foreign investment and expansion by non-British companies.
To top all this off, Qatar – which owns more London property that HRH The Queen – has announced that it will be investing an additional £5bn into the infrastructure of the UK.
This vote of confidence in the UK’s location, infrastructure, workforce and quality of life is a clear indication that Britain is still the world’s financial epicentre and an economic powerhouse.
Exchange rate offers investment benefits
What other factors support strong interest in business migration to Britain?
The impact of the weaker pound has cut both ways – making it easier to find cheaper land and property in Britain if you do choose to immigrate here for commercial reasons. The weak pound is also believed to be one of the main spurs for a series of high profile mergers and acquisitions involved British firms.
Plus, many overseas investors are believed to be taking advantage of the current exchange rate to buy cheaply, ready to enjoy great returns when the pound inevitably rises again after EU exit negotiations conclude.
Property market buoyancy
There is also fertile ground for overseas investors – both major players and smaller business immigrants – thanks to a relatively buoyant property market.
The evidence for this is also clear. Research commissioned by London Mayor Sadiq Khan concluded that since the Brexit vote, foreign investors have increased their interest in new property developments in and around London, with the most interest coming from Hong Kong and Singapore.
The survey also showed that between 2014 and 2016, some 3,600 of London’s 28,000 newly built homes were purchased by investors from overseas.
Skills and long term workforce investment
According to Woodgrange Solicitors LLP, who are a specialist immigration law practice, one of the reasons the UK is proving a draw for business immigration is that it is not suffering as much as other countries in terms of specialist skills shortages. And Britain has robust and far reaching initiatives underway to upskill the future workforce.
According to figures from the Organisation for Economic Co-operation and Development, some European countries have reported substantial skills shortages in firms with over 10 employees. As percentages, this equates to 63% in Turkey, 40% in Germany and 34% in Italy. Elsewhere in the world, the figures are even more startling, with Japan acknowledging that 81% of its companies struggle to find qualified staff.
Meanwhile, the UK has a 12% skills gap which, though still considerable, is not a crisis.
Britain boasts an enviable education system which has resulted in many top business people sending their offspring to be educated here. It’s is also making substantial inroads into generating greater levels of STEM (science, technology, engineering and mathematics) skills, including funding teachers to improve educational provision in those subjects, and incentivising students to study those topics at universities and colleges.
Recruitment from overseas
The publicity surrounding Brexit has implied that recruiting overseas talent to the UK will be problematic. There will be greater administrative and cost implications to UK immigration of all forms. However, these are not hoops of fire! The systems and charges are likely to be similar to those currently used to bring non-EU workers to the UK.
As for smaller overseas investors and foreign entrepreneurs, the draw is as strong as ever, including applications via a Tier 1 Entrepreneur Visa.
The UK’s prominence in global financial and economic affairs means that many top overseas entrepreneurs have existing connections here. For others, it is a fertile time to bring their expertise and capital to help grow emerging British businesses.
In quarter one of 2017, the Home Office reported that 839 investors (631 classed as entrepreneurs) invested in the UK.
The facts speak for themselves. The UK is not only still “open for business”. It is a fertile and supportive location for ambitious foreign investors.
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