Foreign Direct Investment 2016-17

Debate between Stephen Kerr and Michael Tomlinson

Tuesday 12th September 2017 Westminster Hall

[Michael Tomlinson (Mid Dorset and North Poole) (Con)]

I beg to move,

That this House has considered foreign direct investment into the UK in 2016-17.

It is a real pleasure to serve under your chairmanship, Mr Gray. You might be forgiven for thinking that foreign direct investment is rather a niche subject for a Tuesday morning, but it is vital, particularly in the context of Brexit and of course international trade more generally. I am delighted to have secured this debate. The timing is especially apt after last night’s vote on the European Union (Withdrawal) Bill and our consideration of the Finance Bill later on today and into this evening.

FDI refers specifically to cross-border investments made by residents and businesses from one country into another and—importantly—with the aim of establishing a lasting interest in the enterprise that is operating in a foreign economy. I hope that this debate will focus on inward investment into this country—into UK companies —by foreign companies and enterprises. I will explore several main themes, including investment in the UK in the context of Brexit. I will give specific figures on FDI and statistics for 2016-17, and describe how FDI is spread across the regions, which is certainly important for me as a Member of Parliament from the south-west. I shall also discuss opportunities for FDI after Brexit and put some specific questions to the Minister.

First, let me talk about investment in the UK generally. As The Economist points out this week, many people warned of a slump in our economy following last year’s EU referendum. The expectation was that investment would decrease and that FDI itself would dry up, but that has not happened. Companies such as Google, Nissan, Toyota, Amazon and even Snapchat have shown that Britain is still a great country in which to invest.

Toyota recently announced an investment into the UK of more than a quarter of a billion pounds for its plant near Derby. Nissan is increasing its production in Sunderland by a fifth, doubling the amount of parts that it sources from within the UK and stepping up production by about 20%. Importantly, as we look to the future and electric vehicles, Nissan is investing strongly in this country, particularly in Sunderland. Google has invested £1 billion in 3,000 more jobs, and Amazon recently announced that it was taking over 15 storeys and 600,000 square feet of a new building in Shoreditch, which is even more than it originally promised back in 2014. That shows that London really is the capital of research and development, certainly for Amazon, which is also increasing the number of jobs.

[Stephen Kerr (Stirling) (Con)]

I congratulate my hon. Friend on securing this debate on a vital subject. He mentions London, but I would like to mention my home turf of Scotland. I am sure he is aware that Scotland was recently voted the most beautiful country in the world by the readers of a certain travel publication, but is he also aware that for the last five years in a row, Scotland has been the top location in the UK outside London for FDI? In fact, despite the warnings of naysayers and prophets of doom, 2016 was a record year, with 122 FDI deals done in Scotland during that year, which was up from the previous year. Does he agree that an industrial strategy with an emphasis on education and skills, combined with proactivity on the part of the Department for International Trade and business-friendly taxes, can help to make all the nations and regions of the United Kingdom irresistible to foreign investors? Should we not all be very positive about our future outside the European Union?

[Michael Tomlinson]

I completely agree that we should be positive about our future outside the EU. The whole purpose of the opening part of my speech was to show that, even after last year’s EU referendum result, the situation has not been all doom and gloom. I will talk about Scotland and the regions a little later in my speech, but my hon. Friend is absolutely right.