Foreign investment in Britain’s financial and professional services will be cut in half to one billion pounds ($1.25 billion) by 2023, according to the City of London, despite the fact that the UK remains a top worldwide destination.

The industry is experiencing stiff competition in capital markets, notably for listings in New York and, following Brexit, EU financial capitals such as Paris and Amsterdam.

Approximately 7,000 jobs also departed the UK for new post-Brexit centres established in the European Union by banks, insurers, and asset managers to prevent disruption caused by Britain’s exit from the EU.

The one billion pounds in 2023 were half of the “exceptional” two billion pounds in inbound investment in the industry in 2022, as a harder economic backdrop affected mood, according to the City of London, which manages Britain’s primary financial district.

The United States was the greatest source of funding, contributing for more over 40% in 2023, with 222 projects creating nearly 7,000 employment.

Investment management businesses emerged as the key drivers of inward investment initiatives last year, accounting for one-third of total investments (227 million pounds), according to the City.

Chris Hayward, City of London policy chair, believes a more planned approach is required to encourage inbound investment.

“This starts with creating a hub to showcase our offer to the world, alongside a strong financial services strategy,” Hayward said in a statement.

(Adapted from Reuters.com)

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