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India overtakes Britain as investment destination
Thursday, 18 September 2003, 19:30 IST
LONDON: The study, carried out by management consultant AT Kearney, says for the first time, Asia has overtaken Western Europe in the ranking of the most attractive world regions for foreign investment.
A majority of the top 10 destinations are now developing economies, with the list topped by China. The U.S. is placed second.
Industry experts described Britain's drop of four places, from the third to the seventh place, as a "catastrophic slump". Fears were expressed that this could lead to a further reduction of jobs.
The countries that have overtaken Britain are Mexico, Poland and India. The three have been attracting huge inflows of investment because of cheap labour, well-educated labour forces and increasingly business-friendly governments.
Britain has long held the reputation of being one of the world's leading magnets for foreign investment. Other developed economies that have dropped out of the top 10 destinations are France, Italy, Canada and Australia.
The report stated that the new stars of inward investment were Russia, Poland and the fast rising "little tigers" of Eastern Europe such as Slovenia, Romania and Baltic states.
The study is likely to cause further concern within the British government at a time when thousands of jobs have moved to India as part of the outsourcing boom.
It will also be seized upon by campaigners for Britain's entry to the euro who will claim that Britain's share of inward investment has been in decline since the birth of the euro in 1999.
Foreign direct investment into Britain fell for the second year running -- from $62 billion to $25 billion, a drop of around 60 percent.
The report recorded a "huge shift" from "heavy" investment in new factories or assembly plants to the new trend of outsourcing of call centres and IT functions.
Source: IANS
Source: IANS