Global leaders and industry heavyweights met in the UK for the Global Investment Summit, ‘Building a Greener future together’. The Summit, hosted by UK Prime Minister Boris Johnson, focused on green industries. It showcased the breadth and quality of investment opportunities across the UK to foreign investors, as the UK Builds Back Better from the pandemic. The theme of the Summit is of particular importance given the UK hosted the UN Climate Change Conference COP26.
The UK’s Ten Point Plan for a Green Revolution, announced by Prime Minister Johnson last year, will transform our economy; delivering green jobs and growth and setting us up to become the world’s number one centre for green technology and finance, whilst also taking action on climate change. The Plan will mobilise $22 billion of government investment and unlock three times as much private sector investment by 2030, creating green investment opportunities for international investors.
The Global Investment Summit will highlight these opportunities demonstrating why the UK is an attractive destination for investors and a global hub for green technology and finance.
EY’s Attractiveness Survey 2021 confirmed that global investors see the UK as the most attractive place for future investment in Europe.
This will not be a surprise to Australian investors – the UK has long been a preferred destination for Australian foreign direct investment (FDI), equating to $134.5 billion in 2020. There are over 500 Australian majority owned affiliates in the UK, including FDI investors and institutional capital investors, accounting for over $18.5 billion of direct investment in UK assets, particularly water, power and airports.
Macquarie Group is one of the largest inward investors in the UK. They have invested and arranged over $90 billion since 2005, including financing approximately 50 per cent of the UK’s offshore wind capacity currently in operation and managing portfolio companies in essential community assets covering utilities, transport and telecommunications.
In 2016 AustralianSuper announced a further $900 million in the 67-acre Kings Cross Development, whose occupiers include Google’s European headquarters, to take their stake to a majority 67.5 per cent. In 2020 they also made an investment into Peels Ports group acquiring 25 per cent of the company with a value of £1 billion/$1.87 billion.
Owner-developer Lendlease has been investing in new infrastructure and regeneration projects across the UK. Lendlease has been working with Southwark Council since 2010 on a $4.24 billion regeneration project in Elephant & Castle in central London. Most recently in June 2021 they finalised a joint venture contract with Birmingham City Council for the $3.5 billion Smithfield Birmingham development.
Most recently, Australia’s BAI Communications was awarded a 20-year concession by Transport for London (TfL) to deliver high-speed mobile connectivity across the capital, in the most advanced and largest infrastructure project of its type in the world.
The UK-Australia Free Trade Agreement, which is reaching the final stages of negotiations, will open up more exciting opportunities for Australian investors. My team is already seeing increased enquiries asking how companies can make the most of the opportunities this FTA will unleash. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP membership will further increase this positive momentum.
So what is it about the UK, home to 67 million people with the fifth largest economy in the world, that is so appealing to Australian and global investors alike?
The UK is an obvious top choice for investors. We have the lowest corporation tax rate in the G20 at 19 per cent. Our highly skilled workforce is the envy of the world. And we have a strong track record of business growth and strong investment returns.
But it’s our ability to innovate in the industries of the future and our leadership in research, science and technology that makes the UK a top choice for investors.
Venture Capital investment into the vibrant UK technology sector is third in the world, hitting a record of $20 billion in 2020, and is a growing opportunity. Our Research and Development Roadmap helps create better regulations for startups and entrepreneurs and attracts the best talent. And our new Digital Trade Network drives collaboration and connects businesses from Australia and the UK to increase digital innovation and improve people’s lives.
With Australia accounting for 40 new projects and 659 new jobs in the UK from foreign direct investment in 2020-21, and over $2.2 billion of Australian capital institutional investment into the UK, it is evident that the business links between our two nations remain stronger than ever.
As the global investment community focuses on the UK , the Summit showcased the best of British innovation and our commitment to green growth. Whether it is the mass scale production of electric vehicles or developing the first town heated entirely by hydrogen by the end of the decade, we illustrated why there has never been a better time to invest in the UK.