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UK named second-best investment hotspot - why?

Journalist: Jon Brady, Daily Mail

ended 21. January 2025

Britain has been named the world's second-best place to invest globally following PwC's survey of top CEOs - but can you tell me why? Is it the stability of a new government? Rising confidence in Britain's place in AI? The pound being stronger than we think? Let me know!

The UK has risen to become the second-most attractive global destination for international investment according to PwC’s 28th Annual Global CEO Survey.  This is the first time the UK has secured this spot in the 28 year history of the survey.

This shift in attitude towards the UK comes at a time when CEOs globally are looking at new sectors and markets - more than a third said they had started to compete in new sectors in the last five years - to stay competitive. 

The UK, having moved up from fourth the previous year, trails only the US in this year’s survey, with 14% of global CEOs' saying the UK will receive the greatest proportion of planned international capital expenditure. The US commands 30%, with Germany (12%), China (9%) and India (7%), making up the top five investment destinations.

https://www.pwc.co.uk/press-room/press-releases/research-commentary/2024/global-ceos-rank-uk-most-important-market-after-us---pwc-s-28th-.html

4 responses from the Newspage community

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Editor
Gabriel McKeown
Political & Economics Writer at Sad Rabbit - Substack Newsletter
From Rule Britannia to Bargain Britannia, the UK’s rise in investment attractiveness reflects a recalibration of international sentiment, largely driven by poor domestic performance and weak sterling, following years of economic and political uncertainty. Consequently, the UK's recent surge in global attractiveness is a double-edged sword stemming from prolonged underperformance that has rendered British companies comparatively cheap rather than indicating future growth potential. The danger is that Britain risks becoming a ‘value trap’ market rather than a true value proposition, where short-term international investors are attracted by low valuations and may prioritise quick returns over long-term growth. Therefore, it is essential that any short-term momentum is converted into lasting investor loyalty, which can only be achieved with significant economic growth-focused policies, which the current government has yet to illustrate, following a decidedly negative budget late last year.
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Editor
Tony Redondo
Founder at Cosmos Currency Exchange
The UK’s rise to the second-most attractive global investment destination, according to PwC’s 28th Annual Global CEO Survey, is driven by several factors. Post-Brexit stabilization and the UK joining the CPTPP has increased confidence in the UK’s trade relationships and regulatory environment. The country’s growing prominence in AI and tech innovation, particularly in London and Cambridge, has made it a hub for investors in emerging technologies. Additionally, the Pound Sterling was the second best performing G10 currency of 2024, enhancing the UK's appeal, while its resilient economy and diverse industries, including finance, pharmaceuticals, and green energy, attract global capital. The UK's strategic trade agreements and its position as a gateway to European and global markets further bolster investor interest whilst the FTSE100 stock market index in London is seen as “cheap” in international terms, contributing to its rise in global rankings.
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Premium
David Belle
Founder and Trader at Fink Money
It is because they can get a major discount to asset value. Most UK-listed companies do business in USD. With a weaker sterling and almost zero demand from UK citizens to own shares in UK companies, there is no bid keeping share prices higher like there is in the US, Canada and Australia. So any foreign investor is going to see the UK as a place where they can buy assets cheap relative to future cashflows (because the cashflows are not UK domiciled). It's a sleight of hand to hail this as a UK win. In reality, it's the oppposite. In the same survey, it suggested 34% of CEOs believe their businesses won't be economically viable in the next 10 years, up from 21% the year prior. So this survey is not telling the complete picture at all.
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Jai Khandpur MRICS
Investment Manager at IP Global
In the context of property, the UK offers much needed stability to global investors. This is not just applicable to London, but up and coming markets like Manchester and Birmingham have shown resillience in the face of global turmoil due to a constant flow of demand.