The UK remains the most successful country in Europe at attracting foreign investment, a survey showed today.

Competitive cost levels, flexible labour laws, the large domestic market and the benefit of an English-speaking workforce all helped the UK score top marks with investors.

The survey also showed that many companies setting up regional headquarters were turning to the UK, as well as the United States, Switzerland and Ireland.

Researchers said this was due to the strategic location of these countries, the quality of infrastructure, their skills base, high quality of life and favourable tax environments.

The IBM Global Investment 2003 report showed that cross-border investments were still increasing, with more than 1.3 million new jobs announced globally in 2003 as a result of 11,000 new projects.

IBM business consultant Roel Spee, who worked on the report, said: ''The UK has been the dominant country for a long time.

''It has a number of strong points for investors - its cost levels are very competitive and its flexible labour laws are another traditional strength. ''It is also helped by the fact that English is the number one corporate language.''

The UK was especially successful at attracting service centres, such as call centres and software development centres.

The report also showed that the United States was still the leading country for foreign investment worldwide.

New technology development and purchasing power were among the reasons for investors finding the US attractive.

The US was the leading country for manufacturing investment, as well as the car industry and pharmaceuticals, while China was top for investment in the electronics industry.

Information used in the report was compiled from the Global Investment Location Database, which records investment project announcements around the world on an ongoing basis.