OVERSEAS firms created more than 71,000 jobs in the UK last year, following a big rise in inward investment projects.

There were 869 new projects and expansions, a rise of 15 per cent on the previous year, creating almost 20,000 more jobs than in 2000/01.

The US was the biggest investor, with 421 projects, creating almost 40,000 jobs, followed by Germany (71), Canada (56), Japan (51) and France (43).

Most of the new projects were in computer services, electronics, finance and automotive.

Trade and Industry Secretary Patricia Hewitt said the figures showed the UK was Europe's top investment location.

Kitty Ussher, chief economist of Britain in Europe, said: "Foreign investors presently believe that Britain will join the euro in due course.

"Ruling out membership, as anti-Europeans seek to do, would jeopardise our success."