1 February 2012 Last updated at 02:51 ET

Wales inward investment: Cardiff Business School report's concern over decline

Cardiff Business School says a lack of co-ordination among agencies has led to conflicting messages.

Wales must be better marketed around the world to stop a big fall in inward investment, a report has warned.

The Cardiff Business School study says Wales is lagging behind almost every other part of the UK in terms of attracting foreign companies and jobs.

It urged that agencies should work together to improve Wales' image globally.

The Welsh government said it was working to "sell Wales to the world" in a bid to boost the economy.

The report said Wales had seen a "steep downturn" in inward investment over the past decade following a period of success in the 1990s.

It said that although a lot of investment had now gone to eastern Europe, China and India, other areas of the UK were still managing to improve their performances.

Wales, on the other hand, had fallen from being the second best performing UK area for inward investment in 2003 - excluding London - to second from bottom, ahead of just the south west of England.

The report for the Cardiff Business Partnership - which represents employers in the capital - said this was "disappointing" and should be of "concern".

Poor promotion

Cardiff Business School, which conducted the study, is part of Cardiff University.

Analysis

Nick Servini BBC Wales business correspondent

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It is a big contentious subject. Inward investment was such a big part of Welsh economy with the demise particularly of heavy industry. It was a touchstone issue.

The Cardiff Business School report is fairly short and made up of data and a variety of confidential, anonymous anecdotal stories.

The overwhelming impression is the lack of co-ordination among agencies.

And there is almost a distrust among a variety of different agencies out there trying to bring companies to Wales and selling Wales around the world.

There are stories of people protecting their own contacts, nothing to really gain by sharing work together.

One confidential source talks about one company going to Newcastle because, in effect, it was fed up of being bounced around different agencies.

Another talks about the time of the Ryder Cup and a sizeable advertisement in a north American publication. And on the page opposite was another advert from a Welsh local authority, again pointing to a lack of co-ordination.

The other big message is about the marketing and international branding of Wales and in one line it says there is a perception of Wales being closed for business and that's a damning assessment.

And there is reference to Scotland peppered throughout this report because it has become the market leader in inward investment in UK.

In terms of its conclusion the report pulls back from the full radical view which would be to scrap all the different agencies and bring back an arms length body like the Welsh Development Agency which co-ordinated much of this before it was demolished in 2006.

The Welsh government, in reference to some of these criticisms to the general system, says much of it relates to the former administration and it has already recognised many of the points.

Their research found that people who work for agencies involved in inward investment believed one of the reasons for the decline was that Wales had not been promoted well over the past few years.

It said that many believed marketing had become worse since the Welsh Development Agency (WDA) was taken over by the Welsh government in 2006 as part of the so-called "bonfire of the quangos".

The report also said that agencies did not work together enough to promote Wales and were often competing against each other.

It urged them to join together to launch a marketing campaign which shows the country as a "more attractive place".

The report, called Selling Wales, said: "A more proactive marketing campaign designed to let global firms know what Wales has to offer, both in terms of skills and in terms of location, is required.

"To date the brands of Wales and Cardiff have been communicated too weakly, with different agencies each trying to focus on separate components. This fragments the overall message."

Adrian Clark, chairman of Cardiff Business Partnership, said attracting investment into Wales continued to be essential and that selling Wales should be a team effort.

"Inward investment is even more competitive than it was in the 1990's," he added.

The Welsh government pointed out that the report relates to the former administration and said it had already recognised many of the points raised and moved on.

"Since her appointment last May the business minister [Edwina Hart] has been working with industry and commerce leaders to decide how to best to promote Wales and the Welsh brand across the world," a spokesman said.

"We need to showcase what we have to offer, the world certainly isn't going to come to us.

"That is why last year the first minister (Carwyn Jones) led trade missions to New Zealand and China and this year already has overseas visits planned to New York and India."

He added: "We are now looking to open a Welsh government office in central London and are preparing a detailed itinerary of Welsh trade missions and other opportunities to promote Wales overseas."

Report author Dr Andrew Crawley said there was "almost a competition" between different agencies involved, although they were working with the same aims.

"The problem we found is a lack of co-ordination between those agencies and a lack of communication and in some cases there is almost a competition between agencies to bring in firms and, if you put all that together, it gives us an uncompetitive approach to doing this compared to other regions," he said.

He said the remit of the report was to understand how things were done in Wales. It looked largely at the Cardiff city region last year before the new Welsh government took over.

Percentage of UK new inward investment projects (excluding London)
Rank 2005-10	Area	Average %	Rank 2003-04 and average %
Source: UKTI and FDI Markets ™ from the Financial Times
1	Scotland	9%	1 (8.5%)
2	North west England	6.8%	3 (6.5%)
3	West Midlands	5%	4 (4.5%)
4	Northern Ireland	4.3%	5 (4%)
5	North east England	3.7%	6 (3.5%)
6	Yorkshire and Humber	3.7%	9 (2%)
7	East Anglia	3.7%	8 (2.5%)
8	East Midlands	3.5%	8 (3.5%)
9	Wales	3.5%	2 (7.5%)
10	South west England	3.3%	6 (3%)