New data shows Liverpool still lags behind other UK cities for foreign direct investment with Metro Mayor Steve Rotherham pledging to push the city region into the top 10. Tony McDonough reports
One of Metro Mayor Steve Rotheram’s pledges when he was re-elected in May was to increase foreign direct investment (FDI) into Liverpool city region.
Mr Rotheram aims to put Liverpool in the UK top 10 for FDIs but new data this week shows the city is still languishing at number 16. In particular Liverpool remains a long way behind Manchester.
Accountancy firm EY has published its latest assessment of the FDI landscape across the country. It shows the North West secured 68 FDIs in 2023, down from 88 in 2022. It pushes the region down from third to fourth place.
Manchester attracted a total of 31 FDI projects last year, with only Edinburgh (32), Birmingham (67) and London (353) surpassing the city’s total. However, this was a lower total than the 45 FDI projects Manchester attracted in 2022.
Liverpool was the UK’s 16-best performing city for attracting FDIs in 2023 with a total of nine projects, up from seven in 2022.
Manchester has cemented its status as a regional economic powerhouse in recent years and Liverpool, despite a renaissance in sectors such as maritime and tourism, remains some way behind.
However, Mr Rotheram is optimistic the city region has the strengths to significantly up its inward investment game before the end of the decade. He proposes to secure 25% more FDIs to the city by 2030.
“The Liverpool city region is an area built on international trade,” Mr Rotheram has said.
His previous ‘One Front Door’ strategy back in his first term as Metro Mayor did not appear to have a significant impact on FDIs but this time around Mr Rotheram has two major projects that could yield significant results.
Liverpool city region has become one of only three places in the UK to benefit from both Innovation Zone and Freeport status.
LCR Freeport launched in January 2023 and the Combined Authority estimates it could create more than 14,000 new highly skilled jobs, deliver £800m of investment and generate an additional £850m of GVA for Liverpool city region’s economy.
Also In 2023 Liverpool city was chosen to be the location for one of the Government’s new investment zones. This £160m, 10-year programme focused on the life sciences sector, aims to leverage up to £800,000 of investment and create around 8,000 jobs.
Two big locations that will be the focus for the investment zone are Paddington Village in Liverpool’s Knowledge Quarter and Sci-Tech Daresbury out in Halton.
Speaking in May Mr Rotheram said: “From the moment I was elected Mayor, it has been one of my priorities to cement our reputation as an attractive environment for businesses to invest.
“We are already home to world leading clusters in life sciences, gaming, advanced computing, and infectious disease control – but I am never content with resting on our laurels.
“That is why we will invest 5% of local GVA in R&D by the end of the decade, nearly double the Government’s own target. I truly believe that innovation will be the fuel that powers our economy forward.
“By establishing ourselves as a hotbed of innovation and new technology, we will be ready to attract many more highly skilled, well paid jobs, businesses and opportunities from around the world.”
One area of concern is the loss of the Lufthansa link between Liverpool John Lennon Airport in February. Lufthansa has suspended the link but has told LBN it could return in 2025.
While the airport remains as strong as ever with holidaymakers – with the launch of Jet2 and expansion by easyJet and Ryanair – it ideally needs a global hub link of the type Lufthansa offered to attract more business travellers.
Overall UK projects increased by 6% last year, from 929 to 985. While Business Services was the activity that drove the North West’s largest volume (27) of FDI projects in 2023, this was followed by manufacturing projects (11) and R&D projects (10).
Stephen Church, EY’s north market leader, said: “Despite persistent economic challenges nationally and globally, the North West remains one of the UK’s top regions for attracting FDI.
“It has also continued to attract the strategically important, high-growth investment activity that policymakers have prioritised in recent years.”