EY: 31% of firms to cease UK investment before EU vote

EY: 31% of firms to cease UK investment before EU vote

Nearly a third of companies plan to freeze or reduce their investment in the UK in the build-up to the EU referendum, according to an Ernst & Young report released today.

Ernst & Young’s latest UK Attractiveness Report found 31 per cent of investors planned to freeze or reduce investments til 2017.

The report comes as economists warned the lack of company investment leading up to the referendum was likely to hurt both UK markets and the broader economy.

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The majority of companies surveyed by Ernst & Young, 72 per cent, said access to the European market was important when considering an investment in the UK, which suggests more companies would rethink their investment plans if it votes to leave the EU.

Companies as diverse as Goldman Sachs, Ford and Airbus have already warned against the UK leaving the EU, threatening to withdraw their operations if the vote passes.

The gloomy outlook in the Ernst & Young report stood in stark contrast to the record year for foreign direct investment (UK) into the UK in 2014.

The number of FDI projects in the UK increased by 11 per cent to 887 in 2014 and the UK increased its market share of all European projects to 20.4 per cent, pulling away from Germany to cement its role as the most popular destination for investment on the continent.