§ The Secretary of State for Trade and Industry (Ms Patricia Hewitt)With my right hon. Friend, the Secretary of State for Foreign and Commonwealth Affairs, I am pleased to inform the House that the UK remains a world-class business location.
Invest.UK has announced today, in its Annual Review of Operations, that there were 709 direct investments in the UK by foreign owned companies between 1 April 2002 and 31 March 2003, as reported by Invest.UK's partner agencies in Scotland, Wales, Northern Ireland and the English Regional 57WS Development Agencies. This is a fall of 7 per cent. on the year before but is a commendable performance against a background of geopolitical uncertainty and difficult economic conditions in much of the world. Moreover, there was a small increase in the number of new jobs—34,396—that these investments will create.
This performance reflects the confidence, which companies around the world continue to show in the business climate in the UK. Indeed, excluding mergers and acquisitions, in which there has been a major global decline, the number of new investments and expansions reached the second highest level ever recorded by Invest.UK.
However, the world is changing. China's membership of the World Trade Organisation and the accession to the European Union of ten new member states in 2004, for example, present both challenges and opportunities. The UK is well placed to grasp the opportunities; but we must not allow our position as market leader in Europe to make us complacent. Invest.UK will further strengthen and adapt its operations around the world and the Government will continue to ensure that the UK provides a haven of economic growth and stability where companies from any country can continue to prosper.
There is the question of whether the UK would be an even more attractive location if it were part of the euro. The Treasury's assessment suggests that, if we joined on the right basis, membership of the single currency would, over time, increase inward investment in Britain. Whatever happens, the Government will put stability and the national economic interest first. Our five tests on euro membership are our stability guarantee.
I am arranging for a copy of the Invest.UK annual review to be placed in the Library of the House.