“The UK offers an incredibly welcoming and entrepreneurial business environment, with a highly skilled workforce and a firm focus on supporting innovation.” – Melanie Frean, International Business Centre Director at Grant Thornton UK
With its unrivalled trading history and highly entrepreneurial culture, the UK remains one of the most attractive and welcoming for overseas investors. Its networks of leading universities, research institutions and innovation clusters mean the country is well suited to businesses in areas ranging from life sciences and artificial intelligence to advanced manufacturing, green technology and aerospace.
And while trading arrangements with its nearest neighbours have changed following the UK’s recent departure from the European Union, its central location in terms of global time zones makes it the ideal place to access markets in Asia, Europe and North America. Meanwhile, the UK continues to play a central role in the global financial system, creating critical access to private and capital markets.
Europe remains a key trading partner for the UK as a result of the agreement which came into force at the start of 2021. Melanie adds: “Trading across the Channel is a bit more complicated at the moment – and businesses are likely to need assistance to set up in the right way – but it remains a viable option. The government, meanwhile, is working hard to establish trade deals with nations elsewhere in the world.”
“The government has stepped up its efforts to attract foreign businesses since Brexit, for example with a new Office for Investment and a number of – free-trading zones which will start to come into operation in the next few months,” Melanie adds.
The UK regularly ranks highly in international comparisons when it comes to the ease of setting up and running a business. The World Bank recently rated the UK as the most business-friendly of Europe’s 10 largest economies, for example, and the 8th globally for ease-of-doing business.
“It is straightforward to set up a company in the UK,” Melanie explains. “And the legal system is far less aggressive and litigious than many other countries. We have high standards in terms of things like anti-corruption measures, but a very fair regulatory regime in general.”
While UK business and financial regulations are transparent, compliance can require some specialist support and organisations from outside the UK will benefit from expert guidance in meeting the relevant requirements.
People from other parts of the world find it relatively easy to relate to the UK’s business culture, she adds: “In the past, of course, people from the UK have travelled all over the world, exporting our ideas and importing ideas from elsewhere. We also work hard to embrace a lot of other cultures here.”
At 19%, is relatively low at present, but this is set to rise for larger businesses to 23% in 2023. In general, however, the business taxation system supports entrepreneurial businesses and innovation and the tax incentives, such as those for research & development, can be very attractive.
While London has huge economic importance to the UK and is one of the world’s major financial centres, industrial specialisations are spread around the country – and the current government is keen to promote a more balanced approach through its “levelling up” agenda.
This involves developing the UK’s transport infrastructure and creating new innovation hubs based on universities and research centres. “There is a cluster of dynamic life sciences and pharma companies based around Oxford and Cambridge Universities, while the Midlands has become a hub for advanced manufacturing,” Melanie says. The UK is also positioning itself at the forefront of the green technology revolution, she adds, with significant levels of public and private sector investment and support for the likes of battery storage, electric vehicles and sustainability in industries such as agriculture and manufacturing.
Melanie adds that the capital markets in London are among the most advanced in the world, providing businesses of all types with access to finance at every stage of their growth journey. “The UK is a particularly attractive place for technology startups: we are behind only the US and China in terms of the unicorns [companies valued in excess of $1bn] we have created: at the moment we have an incredibly buoyant IPO market, which is attracting businesses from all over the world.
“Furthermore,” she adds, “while the last few years have seen a decline in the value of sterling, the upside is that the UK has become a more competitive place to operate,” she adds. Being the leading venture capital market in Europe and the top location globally for cross border bank lending, the UK’s financial centre is one of the best in the world.
The UK has a range of incentives for innovative companies, ranging from research & development tax credits to loans and grants for groundbreaking ideas. Its workforce is highly educated, and the country attracts talent from across the globe through its strong education system.
It is this education system, alongside a high quality of life, and a world-famous cultural heritage, that gives the UK a huge amount of appeal for expats who are considering moving to the country for the medium- to long-term.
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Selling into, supplying or setting up operations in UK can be a step into the unknown. At Grant Thornton, we have the experience to guide you. Our International Business Centre directors can co-ordinate access to international teams, resources and global delivery, while also helping you forge valuable trading relationships in the UK market.