The UK’s ambition for sustainable economic growth cannot rest on domestic policy alone. It depends on deep, reliable sources of private capital, foreign direct investment (FDI) and robust longstanding financial and cultural partnerships.
The UK Government has identified seven pillars as key areas for its growth policy: economic and fiscal stability, investment, infrastructure and planning, regional growth, people (including jobs and skills), industrial strategy and trade, innovation, and Net Zero.
The newly published report, The Value of Guernsey’s Funds Industry to the UK’s Growth Ambitions from Frontier Economics, demonstrates how Guernsey is uniquely placed to support the UK Government to deliver on four of these growth pillars, which require private investment, particularly in employment, trade and human capital.
Guernsey-domiciled funds direct £58 billion into UK assets on an ongoing basis, and the data reveals how Guernsey funds act as a capital engine across multiple sectors, utilising Guernsey’s unique regulatory framework which provides investors with the speed, cost efficiencies and security they need.
As a global capital conduit, with more than 90% of Guernsey-domiciled funds sourced from foreign investors, the island is a hugely important channel for UK-bound investment into growth sectors and asset classes such as biotech innovation, social housing, green energy and venture capital. This investment is drawn from 63 countries, with particularly strong inflows from the US, EU, and a growing share (20%) from Asia-Pacific, Africa and South America. This diverse investor base reflects confidence in Guernsey’s regulatory framework and governance and also positions the island as a global gateway for UK-bound capital.
This global confidence translates directly into UK growth, with Guernsey funds directing investment into a range of different UK infrastructure projects that deliver social and economic benefit to local communities. Notable examples include wind farms in Aberdeenshire and Norfolk, fibre connectivity in Lancashire and Shropshire, and student accommodation across major UK university towns.
The analysis shows these investments support tangible economic input with an estimated contribution of £300 million per year to UK GDP and the sustaining over 7,000 jobs nationwide. This means powering research labs, building homes, delivering clean energy projects and scaling high-growth SMEs across all four UK nations.
Guernsey is not just a passive capital allocator - it is an active enabler of national priorities that has the potential to out-deliver competitor jurisdictions. A partner from leading offshore law firm Carey Olsen, noted in the Frontier Economics report that, “over a 10-year lifetime, establishing a fund in Guernsey rather than Luxembourg could save investors 2-3 million euros.”
This is because, beyond the numbers, Guernsey offers a unique operating environment that enhances the speed, cost-effectiveness and resilience of private finance. For example, the newly streamlined Private Investment Fund (PIF) regime can be set up in as little as 24 hours.
Another important element of Guernsey’s USP is The International Stock Exchange (TISE), headquartered in Guernsey. It supports UK capital markets by providing a regulated listing venue for alternative asset securities. Nearly 60% of new issues on TISE in 2024 came from the UK, and the exchange attracts business from over 35 countries.
Guernsey is also driving capital into the UK’s future-facing sectors. The Guernsey Green Fund regime channels investment into areas such as wind, solar, infrastructure and forestry in all four nations.
Guernsey-based asset manager Gresham House has backed renewable energy projects and digital infrastructure that directly benefit British communities from the Scottish Highlands to East Anglia.
This real world impact that Guernsey has on UK development is well established but still provides a ripe opportunity. Since 2021, Guernsey funds have increased their UK holdings at an average rate of 7% per annum – twice the pace of UK inward FDI from 2021-2023. If this trajectory continues, Guernsey could be responsible for channelling £80 billion into the UK economy by 2029 – a 38% uplift in just a few years.
This additional £23 billion could singlehandedly meet the entire private financing needs of the UK’s new National Wealth Fund (£21.9bn). It could also fund the UK’s £5 billion public housing commitment for 2025–2026 five times over or could help underwrite key green infrastructure projects like HyNet and East Coast Hydrogen, boosting progress on carbon capture and hydrogen energy.
If UK fund promoters were to move away from Guernsey in favour of other domiciles, it is estimated that at least 20% of UK-focused fund investment would be lost.
The island’s relationship with the UK is more than transactional, it is symbiotic, built on shared values, aligned interests and a common vision of prosperity. By continuing to collaborate, we can ensure that global capital remains hard at work, delivering long-term, impactful investment fuelling Britain’s economic future.
Rupert will be speaking on a panel at our National Conference 2025. Find out more and register here.
