One of the world’s biggest pension funds is to set up a new base in London in a move the government expects to provide a major boost to investment in British infrastructure.
The South Korean National Pension Service (NPS) announced the decision on Monday after a meeting between its chair, Jun Kwang-woo, and the deputy prime minister, Nick Clegg, who is visiting Seoul.
The $320bn (GBP 201bn) fund is the fourth largest in the world and has ambitious plans to almost double its overseas portfolio to $36bn. The London office, to be opened in June, is only its second foreign base after New York.
It has already invested more than GBP 1bn in the UK over the past two years, with stakes in Gatwick Airport, HSBC’s Canary Wharf headquarters and other property developments.
Clegg said: “This is fantastic news which has the potential to bring considerable investment to the UK and create a significant jobs boost back home.
“Investment in infrastructure is a virtuous circle, growing our manufacturing and construction sectors and making Britain more attractive for further investment.
“We’re ramping up our sales pitch abroad – Britain is open for business. We’re making sure the UK doesn’t miss out because investors don’t know what’s on offer or about our long-term strategy to deliver world-beating infrastructure. NPS’s decision to open in London is testament to the economic opportunities in the UK.”
On Sunday, the deputy prime minister announced that the UK had ratified a free trade agreement between the EU and South Korea. He said it could add GBP 500m a year to the UK economy and create GBP 2bn of additional export opportunities for UK businesses.
The move is part of the coalition’s strategy of strengthening trade links with the world’s fastest-growing economies.
Clegg is in Seoul to attend the nuclear security summit, which will be attended by representatives of 53 nations including the US president, Barack Obama.
Obama is leading calls for countries to “lock down” vulnerable nuclear materials that could prove deadly in the hands of terrorists.
Britain is to press for greater information security, and its delegation, led by the deputy prime minister, will call for more vigilance about the spread of potentially dangerous information.
There are concerns that data that could be useful to terrorists – ranging from nuclear weapons designs and maps of nuclear sites to details about border controls – is too freely available, particularly on the internet.