40% fall in foreign investment sends South West economy backwards

The TUC has warned the South West is in danger of being left behind the rest of the UK after a report shows foreign investment in the region fell 40% in the last twelve months.

The report by Ernst and Young reveals the South West in 2012 came bottom of the pile when it came to attracting foreign investment projects, at a time when the figure in Wales rose by 244%, in Northern Ireland by 71% and in Scotland it rose by 49%. And of all the 30,013 jobs created in the UK through foreign investment in 2012, just 947 (3%) were created in the South West.

South West TUC regional secretary Nigel Costley said: "This is hugely damaging for the economy in the South West. We're trailing behind other nations and regions, and are slipping further behind.

"Without foreign investment we're not getting the jobs or the knock-on effect on the supply chain of those in work spending more money. International investment and trade is a key part of a vibrant, forward-looking economy but the South West is going backwards into a low-wage, low-productivity and narrow-minded region."

The South West TUC believes the problem has been exacerbated by the abolition of the Regional Development Agency (RDA). The RDA, designed to develop a region-wide strategy, including attracting inward investment, was controversially scrapped by the government in 2009 and replaced with six local economic partnerships (LEPs).

Nigel Costley said: "The South West is simply not doing the business. It reminds me of the Kissinger quote where he asks 'Who do I call if I want to call Europe?'. Who does a foreign investor call if they want to come to the South West. They can't be expected to ring round six different LEPs - 39 across England.

"It's no coincidence the areas in which the development agencies have remained intact have seen a huge increase in investment. Why? Because it's made easier for investors.

"The LEPs in the South West need to look again at how they support inward investment and, if that means they have to work together, so be it. It's time to put the interests of the region first."

Nigel Costley

South West TUC Regional Secretary

0117 947 0521 mobile 0788 779 7153

Ernst and Young UK2013 Attractiveness Survey

http://www.ey.com/UK/en/Issues/Business-environment/2013-UK-attractiveness-survey