Greater Manchester climbs investment rankings as UK battles for foreign capital

Greater Manchester has been named the UK's third most attractive location for foreign direct investment (FDI), according to new research examining how local autonomy and regional competitiveness could shape future investment decisions.

The findings come at a time when competition for overseas capital is intensifying with Government figures showing that UK inward investment projects fell by more than a quarter in 2025/26.

Irwin Mitchell's Investment Confidence Index, produced by the Centre for Economics and Business Research (Cebr), assesses 48 UK locations using measures linked to their attractiveness to overseas investors.

Greater Manchester rose from fifth to third place in this year's rankings, placing behind only London and Edinburgh. Manchester (central) climbed from ninth to sixth, supported by a 12-point increase in its Local Skills score, the largest improvement recorded across any pillar of the index. Birmingham ranked fourth overall.

Impact of devolution

The report is published as the Government continues to advance its devolution agenda and seeks to spread economic growth across all parts of the UK.

While Greater Manchester is highlighted as the clearest existing example of the Government's devolution model in practice, the research suggests that devolved powers alone are unlikely to determine investment success.

Instead, it says regions that convert greater local autonomy into stronger skills, infrastructure and investment-ready opportunities are likely to be best placed to strengthen their appeal to international investors.

The findings indicate that local competitiveness will become increasingly significant as regions take on greater responsibility for economic development and growth.

Bryan Bletso, Head of International at Irwin Mitchell and a corporate lawyer who advises international businesses on investing into the UK, said:

 

"Our latest research highlights the important role that local strengths can play in enhancing a region’s attractiveness to international investors.

 

“Devolution creates opportunities for regions to shape their own economic future, but it is not a silver bullet. Its success will be measured by whether greater local powers deliver the skills, infrastructure and investment-ready opportunities that businesses need.

 

“International businesses also consider factors such as connectivity and long-term growth potential when making investment decisions. The regions that translate local powers into tangible economic advantages will be best placed to give investors confidence in their long-term prospects.”

Government figures show that 1,020 FDI projects landed in the UK in 2025/26, down 25.8% on the previous year. These projects created 69,166 jobs and safeguarded 16,407.