The West Midlands has cemented its reputation as a global investment hotspot, and has emerged as the best regional location in the UK for attracting foreign direct investment outside of London.
The region recorded the highest annual growth rate of all UK locations.
According to official data from the Department for Business and Trade (DBT), 181 FDI projects arrived in the region during the 2022/23 financial year – more than in Scotland and Wales combined and surpassed the South East for the first time. This represents more than 10% of all UK FDI earnings (1,654) – the largest share of all UK regions outside the capital. With 8,252 jobs created by foreign investors over the same period – an increase of 48% compared to 2021/22 – the West Midlands also bucked the national trend of fewer FDI-related jobs.
The last financial year also saw West Midlands Growth Company (WMGC) – the region’s official investment promotion agency – achieve record performance, with projects registered posting an unprecedented 171% increase on last year.
The Business and Tourism Program (BATP), the first program of its kind created to enhance the economic impact of the Commonwealth Games, has played a major role in boosting inward investment performance in the region.
Over the past year, BATP-led trade and investment missions to India; Australia, Malaysia, Singapore and the United States have enabled the region to strengthen existing trade relationships and access new markets to increase the inward investment pipeline. In particular, over the past 12 months, India has overtaken the United States to become the leading source of foreign direct investment in the West Midlands, with technology-led investments in the region being a prominent trend.
A third of WMGC’s portfolio of inward investment projects was secured in 2022/23 as a direct result of the Global Growth Program – a support package – led by WMGC – to help international companies start their growth journey in the UK. These companies include international payments solutions provider, Fincra; Singapore-based RegTech company, Primacy; India-based education technology company, Mind & Matter; India’s first plastic credit platform, The Disposal Company, and Canadian-based African fintech company Kora.
Matt Hammond, Chairman of West Midlands Growth Company (WMGC), said: “Despite the shockwave that has faced the global economy over the past year, these recent FDI figures are a reminder that investment appetite in the West Midlands remains very strong…it shows the distance. The mileage and impact of the West Midlands on the global stage when the right interventions – such as the Business and Tourism programme – are in place.
The West Midlands’ impressive numbers buck the national trend of job decline and outperform all parts of the UK when it comes to FDI job growth – including London. It is a showcase of WMGC’s award-winning investment strategy in practice, as we continue to strengthen relationships with key markets for the benefit of local residents.”
As part of a deeper £1.5 billion deal, WMGC will be involved in developing a dedicated international strategy for the West Midlands jointly with DBT. This will help us enhance the gaming legacy by opening up new overseas markets for West Midlands products and bringing millions of pounds worth of foreign direct investment into the region.
Andy Street, Mayor of the West Midlands, said: “We all know how important inward investment is to the success of the West Midlands economy, and so it’s really great that this latest data shows how we are the strongest performing region.
“Not only does this mean that our industrial heritage, entrepreneurial culture, world-class universities and broad and deep talent pool set the West Midlands apart in the eyes of foreign investors, but it also means that thousands of good jobs are rightfully created here for locals.
“There could be no greater vote of confidence in the region than investors putting their money on the table the way they did last year, but it is now important that we maintain that momentum and continue to build on the global platform that the Commonwealth Games have.”
The strength of the FDI strategy has been in the West Midlands recently recognized In FDi Intelligence European Cities and Regions of the Future 2023, Birmingham, Wolverhampton, Coventry and Warwickshire rounded out the top three. The rankings measure European cities and regions according to their economic, financial and commercial strength.