EUROPE/US – The total invested overseas by US institutions fell 25% in 2001, but the overall amount allocated to Europe continued to grow, from 67% to 73%, according to research by research firm Greenwich Associates.

Greenwich says the value the investments in Europe represent is considerably greater than their investments in all other countries combined.

The report says the main reasons investors are showing a preference for Europe are a common currency, less variation in time-zones and the steady growth shown by major western European countries.

Greenwich says this is particularly true of some countries, such as France, Germany and Switzerland, whose equity markets outperformed the Standard & Poor's US 500 in 2001.

John Webster, a consultant at Greenwich says it ultimately comes down to the fact that Europe offers less risk than other geographical areas outside the US: “More than anything else, Europe looks less liable to political upheaval or to economic stagnation than most other parts of the world” he says.