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Edinburgh's strong economic performance and high proportion of skilled and educated workers have made it the UK's most attractive city for inward investment, according to a new report.

The study by design and consultancy firm Arcadis put the Scottish capital ahead of cities such as Liverpool on fourth and Coventry at fifth. London came in at seventh, highlighting what Arcadis described as the challenges associated with sustaining the growth of some of the UK's most established economic centres.

The report, entitled “Investing in Britain: Cities Built for the Future”, ranks 24 UK cities based on their performance against six criteria deemed crucial for future inward investment and growth. They include the business environment, workforce and skills, infrastructure performance, housing, place and "city brand".

According to the report, Edinburgh currently tops its rankings as an established economic centre, but this means it requires high levels of investment to accommodate continuing growth. The city needs to make sure that the speed of its economic growth does not surpass its ability to invest in housing and infrastructure.

Although the capital benefits from having strong business fundamentals already in place, some additional improvements - including more affordable housing and an environment that fosters invention and the creation of patents - could mean that its strength as a magnet for investment rivals that of any other city worldwide, the report said.

Meanwhile, the study found the UK's largest cities, including London, Manchester and Birmingham, all face particular challenges to sustain their long-term attraction as magnets for investment.

Measures such as having more affordable housing and reducing congestion were recommended as ways of boosting investment in London, while Birmingham and Manchester are urged to boost skills levels to grow their attractiveness to investors.

Peter Hogg, UK cities director at Arcadis, said: "All cities have strengths and weaknesses, and no area is fundamentally 'un-investable'.

"The important thing is to recognise which levers need to be pulled - whether that's more affordable housing, more efficient transport or better digital connectivity - to ensure a city attracts the type of investment it needs. Every region needs to look at what it has, and how it can make the most of it."