EY ‘attractiveness’ survey: Why Scotland is so appealing to overseas investors

Releasing its latest Scotland attractiveness survey, accountancy and business services giant EY said the country was demonstrating “resilience” and continued investor confidence in a challenging global environment.

Scotland secured 108 inward investment projects in 2025. While this was down 20 per cent year-on-year, the country still maintained its long-standing leadership outside London and captured 14.8 per cent of all UK foreign direct investment (FDI) projects in 2025 - down from 15.8 per cent the previous year but comfortably above its ten-year average share of 11.6 per cent.

Across Europe, projects declined 7 per cent, with the UK as a whole falling by 14 per cent. However, figures excluding London (the only part of England to see project numbers increasing, by 5 per cent) show UK project numbers slid 23 per cent.

Scotland also secured 51 new projects in 2025, and 57 deals classed as operation expansions. Over the last decade, Scotland is estimated to have secured 52,144 jobs from FDI, representing 12.2 per cent of the UK total and ranking second in the UK over that period for total FDI employment. Scotland secured six projects in 2025 that announced a projected 100-plus jobs.

EY said investor sentiment towards Scotland remains “highly positive”. Not only has the country secured the most projects outside London, but it is also considered the most attractive UK destination outside London by investors.

One-third of those planning UK investment say they will choose Scotland, up from 27 per cent last year. Investors continue to cite Scotland’s highly skilled workforce, strong infrastructure and overall business environment as core strengths.

EY Scotland managing partner Sue Dawe said: “Scotland’s performance highlights the strength and resilience of its investment proposition. While global investment flow has slowed, Scotland remains the clear destination of choice outside London.

“The powerful sentiment results, particularly within financial services, is a strong endorsement of how positively investors view Scotland - and a signal for policymakers to capitalise on these enduring strengths by translating perceptions into higher investment flows.

“While global macroeconomic pressures, geopolitical uncertainty and energy costs continue to weigh on investment decisions, the survey decisively concludes that Scotland's fundamentals remain strong: a deep talent base, competitive cities, internationally recognised sector strengths and a proven ability to secure high-value investment.”

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She added: “When investors are asked what could be done to improve competitiveness, they point to the same actions the Scottish business community has been calling on for years. There is a single unified voice across the spectrum.

“Rising to this challenge will demand sustained commitment backed by action. But with the new parliamentary term beginning, there’s arguably no better time to muster the political will to bolster Scotland’s attractiveness than now.”

Scotland's “big three” cities continue to play a pivotal role in attracting international investment. During 2025, Edinburgh reclaimed its position as Scotland’s top city for FDI, securing 30 projects - a 25 per cent increase on 2024 - and ranking second overall outside London, after Manchester secured only one more (31) to take top spot. Glasgow is fourth outside London after securing 23 projects. Aberdeen has slipped out of the UK top ten cities outside London at 11th place, however, having recorded five projects, down from 12 the previous year, reflecting continued “challenges” over the future of the North Sea, EY noted.

Investor appetite for Scotland’s big cities remains strong. Edinburgh is ranked as the top UK city for future investment outside London, with 27 per cent of investors choosing the Scottish capital, while Glasgow (17 per cent) also features prominently in investor plans at third outside London.

The study highlights a more sustainable, services-led investment profile for Scotland in 2025. Business services and professional services became the nation’s leading sector with 22 projects, more than doubling from nine in 2024. Software and IT services remained a core strength with 14 projects, while utility supply accounted for 12 projects and machinery and equipment saw nine projects.

Scotland continued to attract high-value investment, particularly in manufacturing, technology and innovation-related activity. Manufacturing remained highly resilient with activity in the sector accounting for 27.8 per cent of projects into Scotland in 2025. Scotland also retained notable shares of UK projects in business services, research and development (R&D) and logistics.

The US remained Scotland’s leading source of inward investment in 2025, accounting for 33 projects, down marginally from 37 the year before. Ireland rose to second place with 12 projects, doubling from six the year before, while France remained third with eight projects, unchanged from 2024.

Germany fell from 12 projects in 2024 to two projects in 2025, and while India was the second highest country of origin for the UK delivering 71 projects, Scotland only saw only one project from India.

In year-on-year terms, Scotland’s number of financial services FDI projects for 2025 dropped to five, from a high of 11 the year before. However, in sentiment polling for financial services, more than half (52 per cent) of investors expect to activate investment plans, which would establish or expand operations in the next 12 months, expect to do so specifically in Scotland.

EY UK chief economist Peter Arnold said: “Against a backdrop of more cautious global investment flows, the UK must sharpen its focus on where it can compete most effectively and deliver long-term value.”