UK is second most attractive country for investment, according to global CEOs

The survey of worldwide chief executives showed a 'vote of confidence in the UK', PwC said

The UK is the most attractive country for investment behind the US, according to a PwC survey. Reuters

The UK has overtaken Germany, China and India to become the most attractive country for investment behind the US for the first time in PwC’s annual UK CEO survey.

The poll showed the UK moved up from the fourth most important destination for investment in 2024, with senior executives also seeing a brighter economic outlook ahead for Britain in 2025.

The PwC survey found that 14 per cent of chief executives from around the world believe the UK will draw the greatest proportion of international investment, behind only the US, with 30 per cent.

They are followed by Germany with 12 per cent, China with 9 per cent and India with 7 per cent in the top five.

PwC described the findings as a “vote of confidence in the UK”, with almost two thirds (61 per cent) of British chief executives optimistic about the country's economic growth prospects in the next 12 months, up from 39 per cent in 2023.

It comes after Chancellor of the Exchequer Rachel Reeves faced mounting questions over flagging UK growth, the impact of her recent Budget measures and rising UK debt levels, with concerns about the pound slumping and government borrowing costs spike sharply this month.

Last week’s weaker-than-expected growth figures, showing a meagre 0.1 per cent expansion in November, heightened fears of a stalling economy.

The recent sell-off in UK government bonds – also known as gilts – has calmed, but experts worry the rout could resume on further disappointing data or unfavourable trade policies from new US President Donald Trump.

“Our CEO survey findings are a vote of confidence in the UK as a place for business and investment,” Marco Amitrano, senior partner of PwC UK, said.

“The UK’s relative stability at a time of instability should not be underestimated, nor should its strength in key sectors including technology.

“However, there is no room for complacency. Reasserting Britain’s place on the global stage requires a tangible path to growth and a consistent government approach to business and investment.”

Ms Reeves, who is this week attending the Word Economic Forum gathering of business and political leaders in Davos, Switzerland, said: “These latest results show global CEOs are backing Britain and the UK is one of the most attractive destinations for international investment.

“And it’s this investment that will help drive economic growth and improve living standards across the UK.”

Despite fears that her Budget measures to increase wage costs for businesses will hit hiring, the survey showed that over half (53 per cent) of UK chief executives plan to increase their workforces this year, up from 48 per cent in 2023.

But longer-term confidence of bosses in their own businesses has been knocked back, with 57 per cent of UK chief executives feeling very positive about their organisation’s prospects over three years, compared with 61 per cent in last year’s survey.

British business leaders are also leading the way in using artificial intelligence (AI) in their firms, with 93 per cent of chief executives saying their firms have now adopted the technology in some way – more than double the 42 per cent in 2023 and higher than the 83 per cent global adoption rate.

But just 36 per cent of UK bosses anticipate AI boosting their profits over the next year, compared with 49 per cent globally, while only 14 per cent of UK chief executives said they saw profit improvements from AI over the past 12 months.

“UK business has begun to move beyond the initial hype of GenAI to the reality of making it work – but that shouldn’t detract from its huge unrealised potential,” Mr Amitrano said.

The survey also revealed that 98 per cent of UK business bosses are planning to make material changes to their business models to stay competitive.

PwC surveyed 4,701 chief executives across 109 countries and territories from October 1 through to November 8, 2024.