Britain has attracted no more overseas investment as a member of the European Union than it would have done alone, research has found.
Many of the myths about the benefits of being part of the Single Market do not stack up, according to cross-party think-tank Civitas.
Although the UK enjoyed a boost after joining the then Common Market in 1973, the increase in foreign direct investment (FDI) was short-lived, it said. Overall, there is no evidence to suggest the market encourages investment and many non-members have a better track record of attracting overseas cash, the EU Effect report found.
Single Market founding members – Belgium, Denmark, France, Germany, Greece, Ireland, Italy, Netherlands, Spain, Portugal and the UK – received the equivalent of £9,300 of FDI per person over its first 19 years while independent European countries Norway, Iceland and Switzerland received £16,460 per person, the study showed.
Report author Michael Burrage said: “There is no evidence to suggest that the Single Market as a whole has been a magnet to foreign investors, or that it has encouraged FDI in the UK specifically. Many non-members have attracted more FDI.”
The report also dismisses suggestions made when the single currency was being set up that remaining outside would hit investment. Britain did see a drop in its share of FDI but France and the Netherlands, both eurozone members, were hit by larger falls, it found.
Juncker row: Page 10.