An increasing share of these projects has come from the USA, as the table below indicates

(Source: Ernst & Youngs's European Monitor 2000)

Over the period 1998 – 2000 as a whole, by far the most projects went to London, as the table below illustrates.

(Source: Ernst & Youngs's European Monitor 2000)

For 1998 - 2000, if sales and marketing offices are excluded, the overall picture changes. London stays in the lead with 13. 1% of projects, followed closely by the West Midlands with 13.0%. Scotland is in third place with 10.9%, followed by the South East with 10.2%.

By far the greatest (and increasing) number of projects are from the software sector, accounting for 22% over the period 1998 - 2000 (29% in 2000) . This is followed by electronics, business services, chemicals, machinery and equipment, auto components, telecoms, pharmaceuticals and auto assembly.

The table below show the regional destinations of US investment over the period 1998 - 2000, and the cumulative regional destination of US investment in the UK respectively.

(Source: Ernst & Youngs's European Monitor 2000)

London has won an increasing share of projects in the last three years. It is winning, in particular, more Contact Centres, HQs (58) , Internet Data Centres and Sales & Marketing offices (107) . The USA is by far the major source of these projects (116 in 2000) .

Software is the leading sector (82 projects) followed by business services, telecoms and finance. However, manufacturing still takes place in London, and London itself is a massive market with areas of relatively lower costs.

The growth of inward investment into the South East is very much a mirror image of London. It has been particularly successful in HQs and Sales & Marketing projects and has experienced rapid growth in projects between 1998 and 2000. Berkshire has been the most popular area, with Reading, Bracknell and Maidenhead the most favoured cities. Most projects were in the software sector (43) , followed by electronics.

In third position for the period 1998 - 2000 overall, the West Midlands has experienced a decline in projects (81/53/48 for the years 1998/1999/2000) .

It has still won the most logistics projects, but manufacturing projects won declined from 41 to 27 to 21 for the three years under consideration. However, manufacturing remains the most important activity. The USA remained the main source of projects, closely followed by Germany and France. Most projects were in auto components and assembly, followed by machinery and transport equipment. However, this does not mean that inward investors should not consider the Midlands as a location for projects in other high tech industries. Coventry, Telford and Birmingham were the most popular destinations.

After a drop in projects coming into Scotland in 1999 (56 to 42) , Scotland has bounced back (to 55 projects) , particularly in sales and marketing and manufacturing activities. The USA (31) was well ahead of Japan (1) , Germany (6) , France (2) and Switzerland (4) as the source of projects into Scotland in 2000. Most projects were in electronics, followed by software and business services. Manufacturing was the leading activity. Edinburgh, Glasgow and Livingston remain the top destinations.
These four regions maintained the same overall positions in 2000 that they had in 1999.

The North West moved up from 7th position in 1999 to 5th in 2000. While the number of projects in 2000 grew (to 42 from 32) , it was still less than in 1998 (52) . The gains have been spread across activities such as contact centres, logistics, and sales and marketing projects. They have been spread across several sectors, especially software and chemicals. Manchester, Liverpool and Warrington were the most popular destinations. The USA remained by far the most important source of projects (17) . Therefore there is some evidence that the Northwest is reducing its dependence on its traditional manufacturing base and winning ‘new economy’ projects that in the past may not have considered the region an appropriate location.

Wales has moved up from 8th to 6th position in 2000. It has held a relatively steady position in manufacturing projects through 1998 - 2000 and won some projects in contact centres, logistics, R & D, and sales and marketing offices that have led to a reasonably good recovery in projects won (from 39 in 1998 to 26 in 1999 and 35 in 2000) . Projects were distributed over a very wide variety of industrial sectors. The message is that Wales could be on the list for a wider variety of project types.

Yorkshire and Humberside drew joint 6th with Wales in 2000, moving up from 12th position in 1999. This is despite suffering a reduction in manufacturing projects between 1998 and 2000 from 38 to 12 to 8. Gains have been made particularly in contact centres and sales and marketing activities.

Between 1998 - 2000 nearly 50% of projects have come from the USA. Germany was in second place with Sweden, France and Switzerland joint third for the period as a whole. Projects were from a wide variety of sectors with software and chemicals standing out. Leeds, York and Sheffield were the most popular destinations.

In 2000 the East of England slipped from 5th to 7th position, partly due to a very good performance in 1999 that was not sustained in 2000. There has been a reduction in the number of manufacturing projects won: from 11 in 1999 to 4 in 2000. Successes have been particularly in sales and marketing, R & D and HQs. Most popular sectors were software and electronics. Cambridge was the most popular location, followed by Chelmsford and Harlow.

The South West has moved up in 2000 from 10th to 8th position, with 27 projects. Contact centres, HQs and sales and marketing offices have helped offset losses in manufacturing. Most projects were in electronics, followed by software, chemicals, auto assembly & components and machinery and equipment. Bristol was the favourite city, followed by Swindon and Plymouth.

Northern Ireland slipped from 6th to 9th position from 1999 to 2000. The reduction in projects won was spread through a wide range of activities, but Northern Ireland is holding out well in manufacturing. Most projects were in software and electronics, with Belfast the most popular destination and, suggest that Northern Ireland is moving successfully towards the new economy.

The North East moved up from 11th to 10th position in 2000. However, the number of projects going into the North East has continued to decline, from 37 in 1998 to 20 in 1999 to 15 in 2000. It is particularly manufacturing that has been on the decline over this period: from 31 to 12 to 7 projects. Losses have been made good partly by a good performance in contact centres, with five projects won in 2000. The most popular sectors were telecoms, software and chemicals. Newcastle was the most popular city. Again, there is evidence of a successful move away from traditional sectors.

Manufacturing has also proved a vulnerable spot for the East Midlands, which has slipped from 9th to 11th position. Projects are distributed through a wide variety of sectors - software, chemicals, plastics and rubber. Derby and Nottingham were the most popular cities, followed by Leicester and Northampton. The East Midlands could be a potential location for a wide range of projects.

There is clearly a good deal of change taking place throughout the UK that affects the location decisions of inward investment decisions.

	Many UK cities have become attractive business centres in their own right.
	Some traditional manufacturing regions are winning services sector projects.
	Some traditionally service oriented regions offer manufacturing opportunities for local or specialised markets.
	Regional organisations are working hard to influence the factors that determine the attractiveness of their territories.

As a result, some of the old preconceptions held about regions are no longer valid. More regions and cities deserve examination by inward investors to find viable alternatives to historic investment patterns.