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£30 billion investment announcement highlights strength of UK economy

Today, as global chief executives and investors gather at Hampton Court Palace for a government investment summit, the UK government has announced £29.5 billion in new investment commitments for Britain. This significant development spans various sectors including renewable energy, technology, life sciences, and infrastructure, with the potential to create over 12,000 jobs.

This show of confidence in the UK economy serves as a testament to the strength and potential of our nation's business landscape. However, it is crucial that the government provides the necessary support to ensure that these opportunities are maximised and fully realised by exploring options to make it easier for foreign companies to relocate to the UK.

The summit itself is set to be a momentous occasion, with more than 200 business leaders in attendance, including figures such as Stephen Schwarzman of Blackstone, Amanda Blanc of Aviva, David Solomon of Goldman Sachs, and Jamie Dimon of JP Morgan. Although a comprehensive list of attendees has not been made public, it is understood that representatives from China and Abu Dhabi have been invited. This move reflects the government's commitment to engaging with global partners and fostering international relations, particularly with China, something which was reinforced by Lord Cameron’s comments recently about engaging more with China.

Spearheaded by the sponsorship of Barclays, HSBC, and Lloyds Bank, this summit comes at a crucial time when Prime Minister Rishi Sunak is vying with the Labour Party to secure the support of the business community ahead of the upcoming general election. Moreover, as Britain faces competition from the $369 billion American green stimulus package, it is imperative that we continue to showcase our attractiveness as an investment destination. Lord Harrington’s report about FDI, which received an endorsement during last week’s Autumn Statement, should be welcome and I hope that the government follow the recommendations and build on the current momentum.

Prime Minister Sunak himself has reiterated the importance of attracting global investment for economic growth, stating, "Attracting global investment is at the heart of my plan for growing the economy." This commitment from the government is further reinforced by recent announcements such as Jeremy Hunt's plan to make a multibillion-pound tax break permanent and Nissan's £2 billion investment in its Sunderland car plant.

Among the investments announced today, one notable commitment comes from Aware Super, an Australian pension fund. They have pledged to invest A$10 billion (£5.2 billion) in the UK and Europe from their new London office. This significant investment includes their recent acquisition of a 22% stake in Get Living, the build-to-rent developer and operator that owns the former Olympic village in Stratford, east London.

Another noteworthy investor is IFM Investors, also from Australia, who will be signing a memorandum of understanding with the Department for Business and Trade at the summit. This collaboration aims to identify infrastructure and energy transition projects over the next four years, with a substantial investment of £10 billion.

It is worth mentioning that the previous summit, hosted by former Prime Minister Boris Johnson in 2021, saw investments of £9.7 billion. Notably, ScottishPower's £6 billion scheme to build three wind farms off the coast of East Anglia accounted for a significant portion of this investment.

Looking to the future, the government reveals that Iberdrola, the parent company of ScottishPower, plans to invest a further £7 billion between 2026 and 2028. This substantial commitment will focus primarily on electricity transmission and networks, including the construction of a subsea transmission cable connecting East Lothian and Co Durham.

In an effort to make it easier for foreign companies to relocate to the UK, the Department for Business and Trade has established an expert panel led by Professor Vanessa Knapp.

Today's announcement and the investment summit should mark a pivotal moment for the UK's economic growth and international standing. As we move forward, it is crucial that the government continues to foster an environment that attracts and supports global investment. By doing so, we can seize the opportunities presented and ensure a prosperous future for the UK economy.

Irwin Mitchell’s international team offers advice and representation for overseas businesses that are active in the UK market, and those that want to be. It recently published its latest report about foreign direct investment into the UK which looks at which countries are investing the most in the UK, which sectors are most attractive, and where the UK hotspots are currently. Download the report here