LONDON (Reuters) – The 2016 Brexit vote spurred British companies into increasing investment in European Union countries sharply, likely at the expense of spending at home, an academic study showed on Monday.

People walk through the Canary Wharf financial district of London, Britain, December 7, 2018. REUTERS/Simon Dawson
FILE PHOTO: People walk through the Canary Wharf financial district of London, Britain, December 7, 2018. REUTERS/Simon Dawson/File Photo

The referendum result led to a 12 percent increase in foreign direct investment transactions from Britain into the EU between mid-2016 and September 2018, researchers from the London School of Economics’ Centre for Economic Performance said.

That translated into an increase of around 8.3 billion pounds, concentrated entirely in the services industry.

Although the authors could not be certain if this would have otherwise been spent in Britain, they cited business survey evidence and media reports that suggested spending often took place at the expense of British.

Conversely, the research pointed to an 11 percent drop in investment transactions from the EU into Britain, worth around 3.5 billion pounds.

“The data show that Brexit has made the UK a less attractive place to invest,” said Thomas Sampson, one of the report’s authors.

“Lower investment hurts the economy and means that UK workers are going to miss out on new job opportunities.”

London and Brussels are arguing over whether a deal clinched in November can be changed, raising the possibility of either a delay to Brexit, a last-minute deal or a no-deal exit.

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