Britain again outmuscles rivals to be named Europe’s most attractive destination for overseas financial services investment
- The UK attracted 76 financial services projects in 2022
- Well ahead of nearest competitor France on 45
- Still concerns about how to restore City’s pre-eminence as listing destination
Britain has again outmuscled rivals to be named Europe’s most attractive destination for overseas financial services investment.
The UK attracted 76 financial services projects in 2022, well ahead of nearest competitor France on 45, as it shrugged off post-Brexit attempts to steal its crown, according to an EY report.
It comes amid concerns about how to restore the City’s pre-eminence as a global listing destination after a series of firms switched to the US.
There are also fresh fears that Britain’s ‘punitive’ tax regime is not helping.
Anna Anthony, UK financial services managing partner at EY, said: ‘The strength of the UK financial market has meant that, even through challenging times, investors see it as the most attractive European financial services market.
Attractive destination: The UK attracted 76 financial services projects in 2022, well ahead of nearest competitor France on 45
‘Our research shows that investors recognise the strength, gold-standard governance and resilience of the UK’s financial system and see it as the preferred destination for growth, innovation and access to top talent.’
The figures cover the number of financial services projects over the year, in which an overseas firm makes an investment by setting up a new operation or expanding an existing one.
In the past decade, the UK has consistently outmuscled European rivals, totting up 819 projects, ahead of France and Germany combined.
It comes amid growing fears over the City’s future. Cambridge-based chip designer Arm’s decision to list in New York came as a blow. A Swedish-led takeover of veterinary drugs maker Dechra added to a string of firms leaving London.
Xavier Rolet, ex-chief executive of London Stock Exchange, said reforms threatened to be a sideshow without changes to a ‘punitive fiscal and regulatory framework’. He told The Sunday Telegraph: ‘We need a recalibration. We have to lower the quadruple taxation of equities in the UK.
‘We have dividend tax, capital gains tax, income tax and a transaction tax via stamp duty, of which the UK has the highest rate in all of Europe. The same pound of income from equities is taxed four times.
‘You have a regulatory framework that forces long-term investors… to effectively short the real economy by preventing them from investing in the stock market.’