Foreign investment decline 'unsurprising'

Recent data showing a slump in foreign investment in the UK is not a major cause for concern, according to the British Chambers of Commerce (BCC).

A report from the UN Conference on Trade and Development revealed that Britain was hit particularly hard by the global recession in terms of inward investment, which fell by half to reach £97 billion last year.

However, the BCC’s chief economist David Kern insisted that foreign investors will inevitably return to the country as the economy continues to recover.

’There’s nothing very surprising there. It’s very much what you would expect in the global situation,’ he said of the UN figures.

Mr Kern added: ’Once you bring the recession to an end, then investment will recover and if investment recovers, you get both foreign investment and domestic investment.’

According to the BCC’s latest economic forecast, published earlier this month, the UK will see its GDP decline by 4.3 per cent this year, followed by positive growth of 1.1 per cent in 2010.
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