COVID 19 & BREXIT
"Covid and Brexit serve to remind us that we need a balanced approach to our economy based on a diverse and productive indigenous business base while remaining an attractive and competitive location for inward investors with the wider economic benefits this brings."
The Covid 19 pandemic impacted severely on global inward investment flows: 40% down in 2020 globally (UNCTAD) and 62% at Glasgow city level (IG). Signs of the forecast bounce-back appeared in 2022 and Glasgow and the city region is beginning to see a slow but steady increase in levels of FDI and FDI enquiries. Digital tech, business and finance and advanced manufacturing are the dominant sectors underlining Glasgow’s growing strengths in a knowledge-led economy.
During the pandemic, working practices changed. With no business travel into or out of Glasgow, Invest Glasgow pivoted to working digitally with the acquisition of new digital tools and creation of digital marketing collateral including a newly-updated website, creating a vibrant and interactive shop window for investors to browse and explore the city and the wider regional assets from their desk.
More widely, digitalisation and remote working took centre stage and it is likely these will remain key drivers for investors. Remote working, for example, has impacted talent's decision on where they want to work and live. It is also impacting a company's decision on where to go and what to invest in and so the availability of world class digital connectivity, the best property options and an excellent quality of life become paramount. Glasgow and the wider city region are strong in these areas and they will continue to be promoted by Invest Glasgow across all of our collateral (including Zoom Prospector) and at events such as the UK’s Real Estate Investment and Infrastructure Forum (UKREiiF) and COP.
The impacts of Brexit have, to a large degree, been masked by Covid and the impacts of Brexit on trade and investment are still being assessed at Scottish and UK levels. However, the latest EY Attractiveness Survey shows that the UK has fallen to third place behind Germany and France in terms of investment attractiveness. It is suggested that political and economic headwinds are now beginning to impact as are trade restrictions and labour shortages resulting from Brexit.
Nonetheless, the proportion of investment is similar today to what it was pre-Brexit Referendum with the USA still our largest overseas market followed by countries in Western Europe, notably France and Germany.
Covid and Brexit serve to remind us that we need a balanced approach to our economy based on a diverse and productive indigenous business base while remaining an attractive and competitive location for inward investors with the wider economic benefits this brings.
In addition to FDI, Invest Glasgow will support city efforts (eg events) to attract venture capital (VC) and other forms of investment to support local start-ups and SMEs especially in our priority sectors.
