Ireland attracted 165 foreign direct investment projects in 2020, placing it ninth on the European league table of the most attractive investment destinations.

The EY European Attractiveness Survey 2021 reports that while Ireland experienced a drop in investment projects since 2019 (from 191) it has maintained its position in first place for the greatest number of projects per capita.

The report examines the performance and perceptions of Europe as a destination for FDI and includes a survey of 550 international investors looking at the impact of Covid-19 on their investment decisions.

EY's analysis shows that while Ireland’s number of FDI projects has dropped for the second consecutive year, this is largely due to a 'Brexit bounce' that occurred in 2018 which saw a record 205 projects.

However over the past five years, Ireland has maintained a steadily high level of FDI at an average of 167 projects per annum.

The US continues to be the most active investor country into Ireland, accounting for 58% of projects, followed by the UK (17%) and Germany (5%).

Feargal de Freine, Assurance Partner and Head of FDI, EY Ireland said the data illustrates how FDI was impacted across Europe in 2020 as the Covid-19 pandemic took hold.

"Despite our own reduction in FDI in line with our European peers, Ireland has held up well and in the last three years alone," Mr de Freine said, "we have secured over 550 projects which is truly remarkable for a country of our size.

"The strength of Ireland’s track record in FDI can also be seen in our GDP and more specifically the tax records for 2020 which were only down by 3.6% despite the devastating impacts of COVID-19, helping to facilitate the significant level of financial support given by Government to firms and individuals during the pandemic."

The report also predicts that investment will rebound this year, with 40% of investors saying they plan to establish or expand operations in Europe in the next 12 months.

Reflecting long-term optimism in Europe as an investment destination, 63% believe Europe’s attractiveness will improve during the next three years, with only 5% saying they think it will deteriorate.

Meanwhile, 80% believe western Europe in particular will be the most attractive global location for FDI post Covid-19.