But Brexit fears are slowing down deals, says Arcadis research

HS2 Euston 1 thumb

The UK is the ninth most attractive market in the world for infrastructure investment, up four places on 2012, according to new research by Arcadis.

The Global Infrastructure Investment Index, which ranks 41 countries by their potential to attract investment, rates Singapore as the most favourable location, followed by Qatar and the UAE.

Taking into account factors such as infrastructure demand, ease of doing business, risk and capacity to deliver, the index places the UK in ninth position and ahead of all other European nations except Norway and Sweden.

It found that the “stable and relatively low-risk nature of the UK’s business environment”, coupled with the government’s “renewed commitment to major infrastructure” – including HS2, Crossrail 2 and HS3 – have opened opportunities to potential investors.

However, it also discovered that the “prolonged and politicised decision-making processes” involved in making decisions on infrastructure “remain something of a barrier.”

Uncertainty around the upcoming EU referendum has also had an impact, the report found, with the number of construction deals slowing as banks and contractors wait for the result.

It said that European firms in particular, who are major investors in the UK, are expected by some to respond negatively to a Brexit.

Chris Pike, UK infrastructure director at Arcadis, said the UK is a “very attractive option for those looking to invest” but added that “wading through the political quagmire” is an issue in the short-term.

He said: “Unless politicians address these concerns, we could potentially see the pool of international investors who are looking to invest in UK infrastructure reduce.”