Investor confidence in Europe has surged in 2017 after three years of decline. Europe has attracted a record level of foreign direct investment (FDI), with Russia making the top five list, according to data from EY.
The firm’s report showed that, despite a slowing growth in Europe, investor sentiment is more buoyant with 50 percent of more than 500 investors highlighting confidence. Investors expect Europe’s attractiveness to improve over the next year (up from 35 percent in 2017).
“Investors from around the world continue to be drawn to Europe as a stable place for business growth and investment. Yet, despite a positive sentiment, the uncertain political environment is invoking caution,” said Andy Baldwin, EY EMEIA Area Managing Partner.
He explained that: “With China’s rise to the number two spot for investment and protracted Brexit negotiations between the UK and mainland Europe, governments in Europe need to remember that it’s the relative attraction of the whole that keeps investment momentum into Europe and it’s not a zero-sum game.”
Central Eastern European countries continue to attract more FDI than its Western European counterparts, according to the report. UK, Germany, and France still grab half of FDI projects in Europe. They are followed by the Netherlands and Russia.
EY pointed out that in Russia, Serbia and Turkey investment projects grew by 50 percent in 2017.
“Russia moved up two positions in the top 15 countries (to fifth place) by FDI, recording a solid FDI growth rate of 16 percent,” it said. The number of jobs created within the framework of FDI projects in Russia was estimated at a record of more than 25,000 last year. Investments mainly concerned the development of new production capacities (202 projects).
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