Question to the Department for Business and Trade:

To ask His Majesty's Government which areas of the United Kingdom have experienced the largest decreases in foreign investment since 2023; and what steps they are taking to ensure the even distribution of foreign investment throughout the UK.

Answered by Lord Stockwood - Minister of State (HM Treasury)

DBT Official Statistics on inward investment show that FDI project numbers into the UK fell from 2023/24 to 2024/25, with London seeing the largest drop and the East of England recording the biggest percentage decline. Year-on-year changes remain volatile and should be interpreted cautiously.

To attract investment, mayoral strategic authorities are delivering growth plans aligned with local strengths and clear pipelines. Our strategy focuses on enhancing infrastructure, skills, and sector clusters to make all UK regions competitive for long-term foreign investment.

Question to the Department for Business and Trade:

To ask His Majesty's Government what is their assessment of the performance of foreign direct investment in the UK compared to that of the other G7 nations.

Answered by Lord Stockwood - Minister of State (HM Treasury)

Data published by the United Nations Trade and Development Data Hub show that at the end of 2024 the UK ranked second in the G7 (behind the United States) for levels of inward foreign direct investment (FDI) stock.

Question to the Department for Business and Trade:

To ask His Majesty's Government what steps they are taking to ensure that the United Kingdom remains internationally competitive in attracting foreign direct investment.

Answered by Lord Stockwood - Minister of State (HM Treasury)

The Government has introduced a modern Industrial Strategy aimed at boosting nationwide growth by removing investment barriers and improving access to finance. The Office for Investment (OfI) has expanded its commercial expertise and regional presence, collaborating with Mayors and Devolved Administrations to link investors with high-potential UK opportunities. Additionally, UK Export Finance has enhanced support for international investment through its new ‘Invest-to-Export’ Guarantee, designed for overseas firms investing in UK export facilities.

Question to the Ministry of Housing, Communities and Local Government:

To ask His Majesty's Government what assessment they have made of the impact of freeports and special economic zones on UK inward investment trends.

Answered by Baroness Taylor of Stevenage - Baroness in Waiting (HM Household) (Whip)

Freeports and Investment Zones, now integrated as Industrial Strategy Zones (ISZs), are delivering strong results for UK inward investment, supporting the government's number one priority – economic growth.

They have attracted over £6.4 billion in private investment to date, including Siemens Gamesa's £186 million wind turbine factory in the Humber and Nissan's £1.12 billion investment in the Northeast Investment Zone.

Over their lifetime, ISZs are projected to generate over £60 billion of private investment, with a focus on the high-growth sectors identified in the Industrial Strategy. Comprehensive Monitoring and Evaluation of ISZs will track progress and impact against this projection.

Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the impact of the UK's tax regime on foreign direct investment competitiveness.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

The UK has considerable economic strengths. It is the second largest services exporter in the world, the second most attractive location to invest in Europe and is ranked sixth in the Global Innovation Index.

Investment is at the heart of the government’s growth mission and is one of its key pillars alongside stability and reform. The UK continues to champion free trade and global investment, supported by over 70 international trade agreements and a competitive tax regime. Our stable fiscal rules and competitive tax system enable international firms to invest confidently and drive innovation across advanced manufacturing, clean energy, and digital technologies.

Investment is critical to growth and we are taking further steps to make the UK the most attractive destination for global investment. As confirmed at the Budget in November 2025, the government has committed over £120 billion of additional departmental capital spending over the course of the Parliament. This investment is being directed to infrastructure and planning priorities that support growth, including supporting regional growth by bringing new affordable homes and improved transport connectivity to more places and supporting energy and net zero priorities through new nuclear power. The National Wealth Fund and the British Business Bank are catalysing private investment and the new National Housing Bank will extend that catalytic effect to the housing market. The strategy is working: the UK is attracting international investment, with £150 billion of new confirmed inward investment commitments at the US State Visit in September and further commitments at the Regional Investment Summit in October.

In addition, following the commitments in the Corporate Tax Roadmap in 2024, the government continues to maintain the parts of the UK corporate tax offer that are most important for attracting new investment: a low Corporation Tax main rate of 25% - the lowest in the G7 - a flexible and competitive regime for intangible assets, the Patent Box, and one of the most generous and competitive capital allowances regimes in the world.

The UK is an attractive location for groups to locate their headquarters or holding companies, offering broad exemptions for gains on disposals of substantial shareholdings and a broad exemption for dividends paid to UK companies. There are also limited withholding taxes on outbound payments such as dividends, interest and royalties.

Question to the Department for Business and Trade:

To ask His Majesty's Government what assessment they have undertaken on the impact of regulatory burdens on the confidence of foreign investors, and on the UK's competitiveness.

Answered by Lord Stockwood - Minister of State (HM Treasury)

This Government has recognised that the administrative burden of regulation is too high. We have now established a baseline for the administrative burden of regulation on businesses of £22.4 billion a year. This is why we have committed to reduce this administrative burden by 25%, or £5.6bn, by the end of this Parliament. The Government is working to make the UK the best place to start and grow a business and this approach is designed to create a regulatory environment that is proportionate, transparent and internationally competitive, enabling businesses to innovate and invest with confidence.

Question to the Department for Business and Trade:

To ask His Majesty's Government what assessment they have made of the need for a coordination service to assist new international investors; and what steps they are taking to deliver this.

Answered by Lord Stockwood - Minister of State (HM Treasury)

The Government has established the service described. It is the Office for Investment (OfI), a joint unit of HM Treasury, the Department for Business and Trade, and Number 10 Downing Street. The OfI was launched in its current form in June 2025, with a remit to source and secure transformational investment that drives economic growth, job creation, and increased productivity across the UK. The OfI operates as a central government function, working across departments and with external partners to attract and land high-value, strategic investments into the UK.

Question to the Department for Business and Trade:

To ask His Majesty's Government what steps they are taking to encourage long-term, high-value entrepreneurship through foreign direct investment.

Answered by Lord Stockwood - Minister of State (HM Treasury)

The Government is taking decisive steps to foster long-term, high-value entrepreneurship through foreign direct investment. Reforms to procurement, generous R&D tax reliefs, and targeted programmes such as BridgeAI, Growth Catalyst (£130 million) and Enterprise Fellowships will unlock capital, markets and talent. Major investment in AI and semiconductors, alongside a three-year stamp duty holiday for UK-listed firms, gives global investors confidence to back UK innovators and drive sustained growth.

Question to the Department for Business and Trade:

To ask His Majesty's Government what consideration they have given to replicating the Office for Investment: Financial Services model for other key strategic sectors identified in the Science and Technology Framework.

Answered by Lord Stockwood - Minister of State (HM Treasury)

The OfI: Financial Services is a bespoke concierge service partnership involving HM Treasury, the OfI, the Financial Conduct Authority, the Prudential Regulation Authority, and the City of London Corporation. It was created to address the particular investment-related needs of the FS sector but was deliberately branded as the OfI to reflect its commonality with the OfI’s remit of sourcing and securing transformational investment. Whilst the Government will always consider the optimum approach to attracting investment, the OfI remains the single front door investment delivery body for the UK. The OfI works closely with DSIT to maximise investment in the Tech sector.

Question to the Department for Business and Trade:

To ask His Majesty's Government what steps they are taking to attract greenfield foreign direct investment in sectors crucial to the UK's industrial strategy.

Answered by Lord Stockwood - Minister of State (HM Treasury)

The UK’s new ten-year Industrial Strategy, launched in June 2025, is explicitly designed to attract and support investment by providing a stable, long-term framework. Targeted initiatives and incentives exist or are planned in areas such as nuclear power expansion, AI Growth Zones, Industrial Strategy Zones and lower energy costs. The Office for Investment (OfI) has expanded its remit, offering tailored support to major and strategically aligned investors. This includes a new Strategic Investment Opportunities team working with local leaders and agencies to identify and deliver high-impact projects, especially in government-priority sectors.

Question to the Department for Business and Trade:

To ask His Majesty's Government what metrics are used to assess the effectiveness of the Office for Investment's concierge service for high-value investors; and how they ensure that departments and arms-length bodies are accountable for delays or failures in progressing high-value investments supported by the Office for Investment.

Answered by Lord Stockwood - Minister of State (HM Treasury)

OfI uses a range of metrics to assess the effectiveness of its operations. These are currently for internal use. OfI’s output is reported in the Official Statistics, and cover market origin, sector and distribution of investment across the UK. This will be supported by the OfI Board, which will coordinate investment activity across HMG and is chaired by the Minister for Investment.

Question to the Department for Business and Trade:

To ask His Majesty's Government what steps they are taking to address key barriers to foreign direct investment, such as high energy prices and land acquisition costs.

Answered by Lord Stockwood - Minister of State (HM Treasury)

We are taking decisive steps to remove barriers to investment, strengthening the UK’s competitiveness. To address high energy costs, the British Industrial Competitiveness Scheme will reduce industrial electricity prices by up to 25%, supporting thousands of manufacturers. The new Strategic Sites Accelerator, backed by over £600 million, will unlock an initial wave of sites for investment from the growth-driving sectors of the Industrial Strategy from next financial year, with the aim of scaling up the programme over time. These measures form part of a wider strategy to create a pro-investment environment that drives growth and innovation.

Question to the Foreign, Commonwealth & Development Office:

To ask His Majesty's Government how the UK's international sanctions regime has impacted foreign direct investment in the UK over the past three years, and what analysis they have undertaken to assess this impact.

Answered by Baroness Chapman of Darlington - Minister of State (Development)

The Foreign, Commonwealth and Development Office undertakes a pre-designation assessment of the impact of a sanctions designation on the UK economy as part of the decision-making process.  The government also publishes impact assessments alongside sanctions-related legislation.

While these assessments seek to be as comprehensive as possible, it is difficult to analyse the direct impact of sanctions on foreign direct investment (FDI), given the complex mix of factors that affect FDI, including geopolitical tensions, regulatory changes, and trade agreements.

Question to the Department for Business and Trade:

To ask His Majesty's Government what plans they have to unlock opportunities from the free trade and digital agreements with Ukraine.

Answered by Lord Stockwood - Minister of State (HM Treasury)

The UK-Ukraine Political, Free Trade and Strategic Partnership Agreement is the central pillar of the UK’s trading relationship with Ukraine. Under this Agreement, tariffs on all goods are temporarily removed until March 2029 (with the exception of poultry and eggs which are liberalised until 31 March 2026), with businesses in both countries benefiting from this arrangement. The UK-Ukraine Digital Trade Agreement supports businesses to trade more efficiently and cheaply, including through secure electronic transactions, e-signatures, and e-contracts. The UK-Ukraine Trade Committee oversee these agreements and discusses how to enhance further our bilateral trade and investment.

Question to the Department for Business and Trade:

To ask His Majesty's Government (1) how the UK-Ukraine Digital Trade Agreement is being utilised to support the adoption of precision-farming, digital agriculture and the deployment of remote-sensing technologies in Ukraine, and (2) what support is being provided to the United Kingdom agriculture and agritech businesses to unlock export opportunities from the UK-Ukraine Digital Trade Agreement.

Answered by Lord Stockwood - Minister of State (HM Treasury)

The UK-Ukraine Digital Trade Agreement modernises our digital trade relationship, benefitting businesses and consumers in both countries. Our joint commitments, such as securing trusted cross‑border data flows and fostering open digital markets and digital trading systems, and continuing cooperation on digital issues support Ukraine’s adoption of data‑driven tools such as precision‑farming and remote‑sensing technologies. The UK-Ukraine TechBridge initiative, which assists the utilisation of the Digital Trade Agreement, facilitates connections between UK and Ukrainian tech sectors, building mutually beneficial commercial partnerships and helping Ukraine to secure investment into its dynamic technology sector. The initiative covers six priority sectors, including agri-tech.

Question to the Foreign, Commonwealth & Development Office:

To ask His Majesty's Government what steps they are taking to promote and encourage private investment in Ukrainian agri-processing through UK Export Finance and British International Investment.

Answered by Baroness Chapman of Darlington - Minister of State (Development)

At the 2023 Ukraine Recovery Conference, the Foreign, Commonwealth and Development Office announced expansion of British International Investment's (BII) remit to support private sector investment in Ukraine. BII has worked with the European Bank of Reconstruction to establish the Ukraine Investment Platform to facilitate co-investment in Ukraine from G7 and European countries including in infrastructure, financial services and agriculture. BII's investment in Ukraine to date includes providing trade finance to local banks to support trade flows of critical goods and supporting a leading Ukrainian agribusiness producer to help it maintain and expand exports to over 70 countries, benefitting more than 2,000 small retail stores and 2,500 farmers. UK Export Finance (UKEF) has made £3.5 billion of financial capacity available to support Ukraine throughout the war, supporting national priority projects for the Government of Ukraine. UKEF's financing has directly enabled Ukraine to access world-class UK defence, infrastructure, and energy capabilities.

Found: 2 August 2024) Anne Lambert CMG* – (Interim Chair) (from 16 September 2024 to 15 June 2025) Lord Risby