Report identifies 鈥榳all of money鈥 from Canada, the Far East and Middle East

europe

Global institutional investors have funds of $1tn (拢600bn) to pump into European infrastructure assets over the next ten years, a major report has found.

The report by law firm Linklaters said the recent trend for heavy investment from Canada, the Far East and Middle East in Europe is set to accelerate, with the UK grabbing as much as a fifth, or $200bn (拢120m), of this 鈥渨all of money鈥.

If fully invested this capital could boost UK GDP by 1.9% a year and EU GDP by 1.4% a year between 2014 and 2023.

However, the report warns EU countries risk 鈥渕issing out鈥 on the investment due to regulatory uncertainty and 鈥渨eak pipeline of assets available鈥.

Linklaters found global investors from Canada, China, Hong Kong, the Middle East, Japan and South Korea had increased their investment in European infrastructure assets by 465% between 2010 and 2013, compared with the previous four years, and predicted this trend would continue.

Chinese funds in particular stepped up their investment in EU infrastructure 鈥 such as roads, bridges, nuclear power plants and airports by nearly 8000% - 80 timed as much - to $22.7bn (拢13.6bn) between 2010 and 2013, compared with the three years to 2009.

Middle Eastern countries increased their investment in European assets by 81% to $13.4bn (拢8bn) over the same period.

Iain Wagstaff, infrastructure sector co-leader at Linklaters, said: 鈥淎s the Eurozone becomes more stable, these investment flows are expected to grow.

鈥淏ut this is dependent on the availability of sufficient high quality assets and projects, as well as continued regulatory and economic stability.鈥