UK given business ‘vote of confidence’ after ranking second-most attractive nation to invest in
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Britain has leapfrogged Germany, China and India to become the second most attractive country for investment behind America for the first time in PwC’s annual UK CEO survey.
In a boost to embattled Chancellor Rachel Reeves, the poll showed the UK moved up from being the fourth most important destination for investment the previous year, while it also revealed top bosses see a brighter economic outlook for Britain in 2025.
It comes after further breathing space was afforded Reeves as gilt yields fell back slightly last week after a sharp rise, while data for the UK economy also showed a surprise 0.1 per cent growth for November.
The PwC survey cheered the findings as a “vote of confidence in the UK”, showing that 14% of worldwide CEOs believe the UK will receive the greatest proportion of international investment, behind only the US, with 30%.
They are followed by Germany with 12 per cent, China with 9 per cent and India with 7 per cent in the top five.
The survey found that nearly two thirds (61 per cent) of UK chief executives are optimistic about UK economic growth in the next 12 months, up from just 39 per cent in 2023.
It comes after Ms Reeves faced mounting questions over flagging UK growth, the impact of her recent Budget measures and rising UK debt levels, with concerns seeing the pound slump and Government borrowing costs spike sharply earlier 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.
Marco Amitrano, senior partner of PwC UK, said: “Our CEO survey findings are a vote of confidence in the UK as a place for business and investment.
“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 hike wage costs for businesses will hit hiring, the survey showed that over half (53 per cent) of UK CEOs plan to increase their workforces this year, up from 48 per cent in 2023.
But longer-term confidence of top bosses in their own businesses has been knocked back, with 57 per cent of UK CEOs 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 CEOs saying their firms have now adopted the tech 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 see AI boosting their profits over the next year, compared with 49 per cent globally, while only 14 per cent of UK CEOs 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.
