听US INVESTORS ARE CONFIDENT IN THE UK, BUT CONCERNS听OVER FUTURE UK-EU RELATIONS听PERSIST

A new survey听published today by听BritishAmerican听Business and Bain & Company听finds听that business confidence is high for听US听companies in听the听UK,听but听future confidence听may听largely depend on听the UK鈥檚 relationship with听the EU.

 

LONDON 鈥撎齁uly,12, 2021听鈥撎齌oday,听BritishAmerican听Business and Bain & Company听launched听the inaugural听Transatlantic听Confidence Index.听The听Index听measures听the听confidence听of US companies听active听in the UK,听including their views on听investing in UK operations over the next听two听to听three听years and in the overall health of the UK鈥檚 relationship with both the US and the EU.

BritishAmerican听Business and Bain & Company surveyed 68听large cap听American companies representing a combined 3,500 years of business experience and employing more than 275,000 individuals across every region of the UK.

The report can be found ,听and the full analysis can be accessed .

US companies expressed听very听high听confidence听in the UK as a destination for business, with a positive outlook for future听investment听despite the challenges of the听Covid-19听pandemic and the uncertainty surrounding听the country鈥檚 exit听from the EU. However,听the survey results also reveal that听many听executives听are concerned听about听the听current听state of UK-EU听relations. They worry听political tensions and practical matters such as听supply chain problems听and听the ability to access听talent听from the EU could overshadow the outlook for the future.

Among the key findings of the survey:

  • About one-third of respondents听rated听their confidence at level 9 or 10
  • About 60% of respondents plan to increase their investment in the UK over the next two to three years
  • Nearly 40% of all surveyed companies said the UK鈥檚 number one priority should be improving the political and economic relationship with the EU if they want the UK to maintain its top ranking as a destination for US investment
  • Almost 80% of respondents reported a confidence score for the UK-EU relationship of 6 or lower, compared with only 20% for the UK-US relationship
  • Only 17% of all US companies surveyed reported听relocating jobs to the EU so far

Respondents听rated听overall confidence听in the UK听a听7.8 on a 10-point听scale and听identified the country鈥檚 most important assets听such as听the UK鈥檚听stable and predictable听regulatory听environment,听its听openness when attracting talent听from abroad, and听its听strong academic and听R&D听records. Despite听difficulties听around the UK-EU relationship, which听are听impacting supply chain logistics and access to听talent,听about听60% of respondents听said they planned听to increase investments in the UK over the next听two to three听years.

Asked what听they would recommend for the UK听to maintain its top ranking as a destination for US business,听companies听highlighted听improving the political and economic relationship with the EU. The second most important priority was finalising negotiations for the US-UK Free Trade Agreement,听which have听currently听been听put on hold.听Other top recommendations听for the UK Government听included听providing听greater clarity around听its听industrial strategy and maintaining a business-friendly corporate tax environment.

鈥淭he UK is very well-positioned to continue to attract companies from the US and from around the globe鈥 says Duncan Edwards, Chief Executive of BritishAmerican Business. 鈥淏ut this positive outlook will be enhanced by a comprehensive trade deal with the US, a more positive political and trading relationship with the EU, and more business-friendly domestic policies.鈥

Respondents viewed the听health of the听US-UK trade and investment听corridor favourably,听rating听it on average听a听7听out of 10, which should improve in the event of a trade agreement.听However,听that confidence level drops to 5 when discussing the UK-EU relationship.

Respondents听assessed听the largest impact of the UK鈥檚 exit from the EU to be听on听supply chains听because of听鈥榬ed tape鈥 issues, followed closely by the ability to recruit and move talent between the UK and the EU. Regulatory barriers, loss of ability to perform certain services in the EU, and tariffs听rounded out the list of impacts.

鈥淚t is听encouraging听to see that US businesses听still听value听the UK as听hub for innovation,鈥澨齭ays Jonathan Frick,听a partner at Bain & Company based in London.听鈥淥verall, US investors听have maintained听the majority of听their workforces听since the country鈥檚 exit from the EU and in particular, financial services firms believe the City will remain a hub for the business community with a broad and diverse talent pool.鈥

 

Editor’s Note:鈥疶o arrange an interview,听please听contact

BritishAmerican听Business

Dominic Parker听at听dparker@babinc.org听or听020 7290 9882听/听+44 7500 115352

Bain & Company

Contact Aliza Medina at鈥aliza.medina@bain.com鈥痮r +44 207 969 6480

 

About听BritishAmerican Business

BritishAmerican听Business is the leading transatlantic trade association incorporating the British-American Chamber of Commerce in the US and the American Chamber of Commerce in the UK.

We are committed to strengthening the economic corridor between the United States and the United Kingdom by supporting policies and action that protect and enhance the environment for transatlantic trade and investment.

We convene and serve a growing network of companies and business leaders through networking opportunities, bespoke programming and marketing platforms.

We actively promote trade and investment and support those who make the transatlantic corridor part of their business growth ambition.

For more information, please visit听www.babinc.org

 

About Bain & Company

Bain & Company is a global consultancy that helps the world鈥檚 most ambitious change makers define the future.

Across 61 offices in 38 countries, we work alongside our clients as one team with a shared ambition to achieve extraordinary results, outperform the competition, and redefine industries. We complement our tailored, integrated expertise with a vibrant ecosystem of digital innovators to deliver better, faster, and more enduring outcomes. Our 10-year commitment to invest more than $1 billion in pro bono services brings our talent, expertise, and insight to organizations tackling today鈥檚 urgent challenges in education, racial equity, social justice, economic development, and the environment. We earned a gold rating from EcoVadis, the leading platform for environmental, social, and ethical performance ratings for global supply chains, putting us in the top 2% among other consulting firms. Since our founding in 1973, we have measured our success by the success of our clients, and we proudly maintain the highest level of client advocacy in the industry.