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Wales did well from EU money, but will that dry up now that the UK has voted to leave?

As a principality, Wales voted overwhelmingly for the UK to leave the EU in the recent referendum. This was a surprising result on at least one level, given that this is part of the UK that has relied on EU grants and subsidies, be they structural or in agriculture and education.

The value of inward investment projects into the Welsh economy during 2015/16 totalled “at least £660m [and] were from companies based in 23 countries around the world”, according to Ken Skates, cabinet secretary for economy and infrastructure in the Welsh government. Post-referendum, he is confident that Wales can continue to attract future foreign direct investment (FDI).

“This is partly down to our open, responsive and business-friendly approach,” he says. “We remain committed to this, to developing Welsh business and to working with new partners to draw in investment.”

Adam Breeze, an inward investment consultant at Breeze Strategy, adds: “I believe that to make the most of international opportunities, we need to take control of our economic destiny. There’s no reason why within a few years the UK couldn’t have free trade deals with the US, Canada, Australia, China, India, and with the rest of Europe too. We are a trading nation and have always looked outward.”

The PM’s test

Amid the political fallout from the referendum vote, the issue of the economy remains a pressing matter for policy makers. Some uncertainty has been lifted following the appointment of a new Prime Minister, but one of her numerous challenges is ensuring that FDI into Wales is not severely curtailed post-Brexit.

“Companies expand and locate in different locations for many complex reasons. Some of these reasons are impacted by the voter, other less so,” says Mr Breeze. “Confidence will return and the strong fundamentals of the UK economy will continue to attract inward investment and Wales will continue to have the same strengths and weaknesses in FDI attraction that it had prior to the referendum. Concern over the potential loss of EU funding in South Wales is misplaced, given that the money comes from the UK originally as a net contributor to the EU.”

Mr Skates adds: “Post-referendum, my priority is protecting jobs and doing everything in my power to maintain economic confidence and stability.”

This article is sourced from fDi Magazine
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