The number of FDI projects into Europe declined in 2012, mirroring global trends, according to data from crossborder investment monitor fDi Markets. These findings were published in The fDi Report 2013, an annual report from fDi Intelligence.

A total of 3891 projects were recorded, representing a 20.82% decrease in comparison with 2011. In 2012, the top 10 countries accounted for 72.19% of FDI projects into Europe.

The UK performed slightly better than Europe as a whole, increasing its market share of FDI into the region to 20.87% in 2012, the highest of any European country. Spain and Poland were the only top countries to experience a growth in FDI, following declines in previous years. Poland increased project numbers by 4.87%, and its market share of capital investment grew to 6.54%. The country also increased its share of jobs created in Europe to 12.7%, indicating the attractiveness of Poland for large-scale projects in both manufacturing and services.

Russia recorded 265 FDI projects, the fourth highest of any European country, and also increased its market share of project numbers and capital investment to 6.81% and 10.99%, respectively. The Czech Republic fell out of the top 10 locations following a decrease of 36.3% in FDI and was replaced by Turkey, which recorded a 35.42% rise in jobs created to 25,941, and increased its market share of European FDI to 3.42%, while its market share of capital investment grew to 6.14%.

FDI projects out of Europe

The number of FDI projects out of Europe also declined in 2012. A total of 5468 projects overseas were recorded, a 17.54% drop compared with 2011. In 2012, the top 10 source countries accounted for 82.64% of FDI projects, with each country holding onto its ranking from 2011.

The UK invested in 1245 FDI projects, ranking it the top source country for FDI from Europe and increasing its market share by 1.9%. Germany also performed well and ranked top for both jobs created and capital investment overseas, creating an estimated 130,000 jobs and investing an estimated $44bn overseas.

Ireland also saw a significant increase in outward job creation in 2012, with overseas job creation by Irish companies up by an estimated 48.71%.

Despite FDI into the Czech Republic declining in 2012 and knocking it out of the top 10, FDI from the country by project numbers increased by 25%. In contrast Turkey, which entered the top 10 in 2012 for inward FDI, lagged behind in outward FDI, sitting in 17th position. The number of projects by Austria-based companies dropped sharply in 2012, from 189 to 128, representing a decline of 32.28%, one of the highest of any western European country.

FDI projects into Europe by sector in 2012

In 2012, ICT was the largest sector for FDI into Europe by project numbers, up from second place in 2011, and accounted for nearly a quarter of FDI into Europe in 2012. Business and financial services slipped to second place, reflecting the weakness of the financial sector in Europe, but still accounting for about one-fifth of FDI projects in the region. Transportation, warehousing and storage sector moved from fifth to third position.

While the top five sectors all experienced a decline in project numbers, the coal oil and natural gas sector maintained its project numbers, while renewable energy recorded a higher number of projects.

To download a complimentary copy of The fDi Report 2013 click here.