Germany’s North Rhine-Westphalia has finished top of fDi’s European Region of the Future 2016/17 ranking. The region performed well in many categories, also being named fDi’s Western European Region of the Future 2016/17 and coming first in the Large European Regions ranking.

North Rhine-Westphalia outward FDI

North Rhine-Westphalia, located in the west of Germany, was the source of the highest number of outward investments of all German regions, and the second highest of all European regions analysed. The region is home to many large industrial companies with large overseas presences, including logistics giant Deutsche Post (with 335 outward investments between January 2010 and August 2015), pharmaceuticals and healthcare company Bayer (89 investments), and chemicals company Evonik (62 investments). In November 2015, Evonik announced major expansion plans for its manufacturing facility in Changchun, China, while in December 2015 alone, logistics company Deutsche Post announced nine investment projects in India, Czech Republic, France, Spain, Malaysia and Russia.

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Europe was the largest destination market for North Rhine-Westphalia’s outward investment – nearly 48% of all outward FDI from the region between 2003 and 2015 went to Europe, with 25.6% going to western Europe and 22.2% to eastern Europe (Figure 1). North Rhine-Westphalia is rich in innovation, with more than 17,600 patents granted between 2003 and 2014 (the highest number of any European region studied), while eight of its universities appear in the Shanghai Ranking Consultancy Global Top 500 Universities ranking. 

Île-de-France on the rise

France’s Île-de-France, home to capital city Paris, ranked second, up three places from fifth position in the 2014/15 ranking. It also placed second among all western European regions, while claiming the top spot in the Connectivity category for Large European Regions. Île-de-France is well connected, with air access to more than 260 international destinations, while France also performs well on indices such as the Logistics Performance Index, the quality of overall infrastructure and quality of roads. The region also boasts nine of the Global Top 500 Universities, while 44% of its population has a tertiary-level qualification.

The UK’s South East England region, the most populous of all UK regions, rose nine places on its 2014/15 position to finish in third place overall. The region performed well in several of the ranking’s categories, particularly in Human Capital and Lifestyle, in which it came first in the Large European Regions category. The South East England region boasts 42 International Baccalaureate schools, which is the highest of any region analysed, while 45% of its population is educated to tertiary level.  

Number of international airports and destinations served

Baden-Württemberg’s large leap

Baden Württemberg, in south-west Germany, ranked first among Large European Regions for Economic Potential, and recorded the highest number of FDI projects between 2010 and 2014 of all European regions analysed. Foreign investment projects peaked in 2014, when 229 projects were recorded in Baden-Württemberg. Ireland’s Dublin region attracted the highest number of FDI projects per 100,000 people of all European regions, helping it finish first in the Economic Potential category for small regions.

The East of England region had the highest number of airports (along with Scotland and South West England), and had the highest number of international destinations served of all UK regions analysed (Figure 2). The region ranked second of all large European regions in the Connectivity category.

Kiev Oblast in Ukraine had the most cost-friendly labour cost levels of all European regions analysed, across three skills sets, helping it reach the top 10 for Cost Effectiveness among Mid-sized European Regions, while Zurich canton in Switzerland was the most expensive region (Figure 3). Russia had the region’s cheapest petrol prices, at $0.60 per litre, one factor among many that landed the country’s regions six of the top 10 spots for Cost Effectiveness among large regions. Petrol was most expensive in the Netherlands, where customers can expect to pay $1.78 per litre at the pumps, at the time data was analysed.

Of all regions in the highly competitive UK, Scotland attracted the highest number of FDI jobs. However, on a per capita basis, Northern Ireland came out on top (Figure 4). Scotland received the highest number of expansion projects per 100,000 people of all European regions analysed. In absolute terms, Scotland witnessed year-on-year increases at an average of 30.7% between 2011 and 2014 (Figure 5), to peak in 2014. This helped Scotland place number two among large regions for Business Friendliness. 

On a country level, Denmark, which had regions place in the top 10 for Connectivity at the Mid-sized Region and Small Region level, has a well-regarded ICT Infrastructure, and scored highest in the United Nations International Telecommunication Union ICT Development Index, while Georgia was the lowest performing country (Figure 6).