Investments from Abroad in the United Kingdom's Artistic Sectors

Dive into the Creative PEC's State of the UK's Nations Report

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A Creative PEC's Take on Foreign Direct Investment

Now's a bloody good time for this new report on Foreign Direct Investment (FDI). The UK Government's fresh industrial strategy places the creative industries as a key sector for growth, and this report on FDI could not be more timely. Our State of the Nations report emphasizes the UK's status as a world leader in FDI for the creative industries—but it also reveals a slip from the 2019 peak. So, it's high time the Industrial Strategy focuses on attracting inward FDI as a top priority along with bolstering outward FDI initiatives.

Our research team at Newcastle University dug into the details and found That:

On average, around 10% of total UK FDI projects were creative industry-related over the last ten years, illustrating their importance.
The UK ranks second globally in terms of hosting and generating FDI creative projects, just trailing behind blimmin' America. Keep in mind we're talking about the Trump administration here!
Almost 45% of inward FDI in the UK came from one place—you guessed it, America.
The creative industries' share of inward FDI experienced a drop from 12% in 2021 to the current stats.
The creative FDI landscape is dominated by mergers and acquisitions (M&As) rather than new (greenfield) projects - a pattern that differs from non-creative sectors.
There's quite a bit of geographical variation: advertising and marketing FDI tend to pop up in the South East of England, IT and software and computer services FDI usually set up camp in main cities, while FDI in Architecture, Film, TV, Radio, Photography, and Publishing are spread out all over the UK.
This suggests that creative sub-sector forces vary regionally and that well-established creative clusters have a significant impact on attracting FDI.

Christopher Smith, AHRC's Executive Chair, who oversees Creative PEC, had this to say on the findings:

"This report showcases our creative industries' potential: one of the UK's industrial strengths. Leverage that potential? Instrumental investments, at scale, with a well-planned, place-based approach. The data backs up ten years of growth in the creative sectors and reveals regional and sub-sectoral variations in FDI activity across the UK. It's crystal clear that vigorous creative clusters play a key role in drawing inward investment."

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State of the Nations

Welcome to our website's 'State of the Nations' series. This series scrutinizes the latest data across four main areas to inform creative industries policy-making. It covers the whole of the United Kingdom, and offers data for all the nations and regions whenever possible. Look out for reports on each area every half year over the five-year course of Arts and Humanities Research Council (AHRC) funding. The themes and corresponding Research Consortium Partners are:

**R&D, Innovation, and Clusters (University of Sussex)

**Internationalisation (Newcastle University)

**Arts, Culture, and Heritage (University of Sheffield)

**Education, Skills, and Talent (Work Advance)

The report was put together by research partners at Newcastle University:

Dr Jonathan Jones, Senior Lecturer (Economics), Newcastle University Business School

Dr Daniel Simandjuntak, Research Associate (Newcastle University and Creative PEC)

Dr Sara Maioli, Reader in Economics, Newcastle University Business School

Professor Giorgio Fazio, Research Director of Creative PEC and Chair of Macroeconomics at Newcastle University Business School

The report design was by Mike Green of Green Doe. Heartfelt thanks to Creative PEC's policy, operations, and communications teams for their sharp eyes, editing, proofing, and support.

Citation: If you chuck this stuff into any future research or publication, please slap on this citation: Jones, J., Simandjuntak, D., Maioli, S. and Fazio, G. (2024) 'Foreign Direct Investment and the UK's Creative Industries'. DOI: 10.5281/zenodo.14045803.

Credits

Report design by Mike Green/Green Doe Ltd

Writers

Dr Jonathan Jones, Senior Lecturer (Economics), Newcastle University Business School

Read More* Dr Daniel Simandjuntak, Research Associate (Newcastle University and Creative PEC)

Read More* Dr Sara Maioli, Reader in Economics at Newcastle University Business School

Read More* Professor Giorgio Fazio, Research Director of Creative PEC and Chair of Macroeconomics at Newcastle University Business School

Read More

The creative industries, a key sector for growth according to the UK Government's new industrial strategy, received around 10% of total UK Foreign Direct Investment (FDI) projects over the last ten years, showcasing their importance.
The UK ranks second globally in terms of hosting and generating FDI creative projects, trailing just behind America, even during the Trump administration.
Almost 45% of inward FDI in the UK came from one place - America.
The creative industries' share of inward FDI experienced a drop from 12% in 2021 to the current stats.
The creative FDI landscape is dominated by mergers and acquisitions (M&As) rather than new projects, contrasting with non-creative sectors.
There is geographical variation in FDI activities across the UK, with advertising and marketing FDI tending to cluster in the South East of England, IT and software and computer services FDI setting up primarily in main cities, and FDI in Architecture, Film, TV, Radio, Photography, and Publishing spread out across the UK.
These findings suggest that creative sub-sector forces vary regionally, and well-established creative clusters have a significant impact on attracting inward investment.
Christopher Smith, AHRC's Executive Chair who oversees Creative PEC, emphasized that the report showcases the creative industries' potential and that instrumental investments, at scale, with a well-planned, place-based approach, are necessary to leverage this potential.
The report, 'Foreign Direct Investment and the UK's Creative Industries', is part of AHRC's 'State of the Nations' series, which scrutinizes data across four main areas: R&D, Innovation, and Clusters, Internationalisation, Arts, Culture, and Heritage, Education, Skills, and Talent, to inform creative industries policy-making.