1st Report - Promoting Wales for Inward Investment

Key findings

• Wales attracted only 3.5% of UK FDI projects in 2023–24, down from 15% in 1990–2004; recent 2024–25 figures show recovery to 4.9%, but remain below historical performance.
• Welsh inward investment is concentrated in lower value-added activities (80%+ in production) and heavily reliant on EU sources; limited diversification into innovation-intensive, high-wage sectors compared to Scotland.
• Complex fragmented landscape of UK, Welsh, and local government bodies promoting Wales creates confusion for investors; no single 'front door' or coordinated 'Team Wales' approach exists.
• Committee recommends creation of dedicated investment-focused agency for Wales (mirroring the abolished Welsh Development Agency); improved intergovernmental collaboration between Office for Investment and Welsh Government; and Wales Office-led diaspora engagement strategy targeting 3–4 million global Welsh diaspora.
• Inadequate data monitoring: DBT figures lack granularity at sub-regional and local authority level; committee calls for annual Wales-specific inward investment report with sectoral and comparative analysis.

Recommendations

• Welsh Government should establish a single, dedicated investment-focused agency for Wales to provide coherent promotion and act as a clear entry point for investors.
• Wales Office should lead development of an investment-focused Welsh diaspora engagement strategy to harness 3–4 million global Welsh diaspora as source of investment leads and business community re-engagement.
• Wales Office should work with Department for Business and Trade and Office for National Statistics to produce annual Wales-specific inward investment report covering sectoral composition and comparison with other UK nations, adjusted for population and economy size; first report by end of calendar year.
• UK and Welsh governments should use intergovernmental machinery more consistently, with greater engagement by Minister for Investment with Welsh Government infrastructure.
• UK Government should improve transparency on volume of Wales investment enquiries generated by overseas network and make better use of Wales industrial clusters, particularly compound semiconductor cluster in South Wales.
• UK and Welsh governments should continue to work together on vital improvements to Wales' business basics: infrastructure, skills provision, and broadband connectivity.

Key actors

Ruth Jones (Labour; Newport West and Islwyn, Chair), Tim Newns (Director, Office for Investment), James Gardiner (Senior Economist, EY), Professor Riccardo Crescenzi (London School of Economics), Jo Stevens (Secretary of State for Wales), Lord Harrington (led 2023 Review of FDI), Vishay Intertechnology, Eren Holdings