A deepening disparity of foreign direct investment (FDI) that flows into Yorkshire has been revealed by a report with the region’s largest cities attracting over half of inward investment and little signs of spillover benefit for the areas that surround them.
The joint report by EY and the Centre for Towns, which captures detailed analysis on where FDI has located across the UK’s cities, towns, communities and villages over the last 21 years, shows that the number of FDI projects has declined across the region within the last 12 months, from 82 to 49.
Despite this overall decrease in foreign investment, the report reveals that the number of projects within the region’s core cities grew steadily from 25 to 27 in 2018, with the smaller towns and communities bearing the brunt of the decline.
This is only the second time since 1997 that the number of FDI projects within the region’s core cities has surpassed that of the region’s towns and communities, illustrating further the flow of investment into core cities.
Leeds attracted 21 foreign direct investment (FDI) projects in 2018, placing the city within the country’s top three performing cities, outside of London.
Suzanne Robinson, managing partner for professional services firm EY in Yorkshire, said: “It’s encouraging to see that Yorkshire’s core cities continue to attract foreign direct investment and that Leeds’ inward investment figures are within the top three outside the capital.
“However, the growing disparity experienced by our region’s towns and smaller communities with regards to such investments is concerning and largely mirrors the UK trend.
“What the Yorkshire region needs is more of that crucial foreign investment spilling over from the core cities like Leeds, Sheffield and Hull and into the region’s towns.
“It’s vital that business leaders, investors and policymakers all make a concerted effort to ensure a fairer distribution of this investment across the region so that more of our towns and communities can share in the wider economic benefits, rather than the lion’s share of success disseminated across a handful of cities.”
The level of investment into the UK’s 12 largest cities, or Core Cities as they are defined in the report, has increased from less than a third, 31 per cent, in 1997 to nearly two-thirds, 59 per cent, in 2018, with over half of all projects over the past two decades being attracted into the major population centres.