The make-up of inward investment into the UK

In 2002, based on earnings in that year alone on the cumulative
inward investment made in the UK in the last couple of centuries,
the breakdown by industry was as shown in Table 6.2. ‘Manufacturing’
accounted for 23 per cent of total earnings; ‘services’ 38 per
cent and ‘resources’ (essentially oil and gas) 39 per cent.
‘Access to the EU’ plays no role in the decision of overseas
investors to choose to invest in the UK in services and oil and gas.
Moreover, ‘access to the EU’ may have been a factor—not necessarily
decisive—in ten per cent or less of investments in UK
manufacturing.4 (‘Access to the EU’ cannot, by definition, explain
the considerable inward investment in the UK that comes from other
EU countries. [See table A4.1, in Appendix IV, p. 65])
HM Treasury, in its October 1997 paper UK Membership of the
Single Currency: an Assessment of the Five Economic Tests, said:
‘The UK attracts a significantly larger share of inward investment
than other countries in the EU. This reflects a number of important
benefits that we offer, including low taxes, the English language and
a flexible labour market.’ Those benefits, it seems, do not include
‘Europe’.