Foreign investment from the likes of Microsoft and Gehrlicher Solar helped the West Midlands become the brightest spot outside London for foreign investors looking at the UK last year.

The manufacturing sector also played a key role in helping the region become an attractive destination, with the number of foreign direct investment (FDI) projects leaping by more than 35 per cent.

Birmingham led the way with 14 new investment projects in the city in 2010, with five in Coventry – but just two in Wolverhampton, according to a new report by Ernst & Young.

Overall the Midlands as a whole saw 91 investment projects last year.

Birmingham saw big names like Microsoft invest through its Rare Games subsidiary in Digbeth, as well as German renewable energy firms Gehrlicher Solar and Juwi setting up bases in the city.

In the manufacturing sector Japanese automotive supply firm Unipres decided to open a facility in Tyseley, creating more than 80 jobs.

Across the Midlands the majority of investments originated from the USA (27), while there was also considerable investment from Germany (11).

Ernst & Young said the Midland investment projects resulted in 3,769 jobs being created in the region, the largest increase across the whole of the England.

Sara Fowler, Ernst & Young’s senior partner in Birmingham, identified manufacturing as a key asset to the region.

“As in previous years the report has shown the strength of the manufacturing sector in the region with 30 per cent of the investment projects coming from this sector.

“Foreign businesses are continuing to invest in the region because of its strong reputation and expertise in the sector.