This report examines how the bioeconomy can drive growth, resilience and nature recovery in the UK. It was commissioned by NatureFinance and produced by Earth Capital Nexus, part of the Grantham Research Institute on Climate Change and the Environment and the Global School of Sustainability at the London School of Economics (LSE).
The UK has one of Europe’s largest bioeconomies – a major economic system that encompasses all economic activity that depends on, processes or transforms biological resources. It contributes an estimated £325 billion a year, 13.2% of gross value added, and employs 6.4 million people, almost one in five UK workers. Crucially, two-thirds of that activity sits outside London and the South East, precisely where the Government’s regional growth and devolution missions need to reach.
The country already has the components of a thriving bioeconomy from world-leading research institutions, globally competitive life sciences, engineering biology capabilities to sophisticated financial markets. Yet its potential remains constrained by fragmented policy and investment. The bioeconomy has grown at just 0.73% a year since 2009, against 1.62% for the wider economy, and ranks only 21st of 28 European countries for growth. The strengths are all there; what is missing is the coordination to connect them.
In this new report, the UK’s bioeconomy is comprehensively mapped as it exists today, identifying barriers to growth and setting out a agenda to turn the UK’s scattered strengths into a coherent engine for growth. It argues that growing the bioeconomy offers a framework for linking economic growth, regional development, resilience and nature recovery, while helping the UK capitalise on advances in areas such as engineering biology, biomanufacturing and bio-based materials.
Where the opportunity lies
There are four connected levers through which the bioeconomy can deliver the Government’s priorities.
• Productivity and devolved growth: The majority of the bioeconomy’s value sits outside London and the South East. Investing in demonstration facilities and regional clusters would help new technologies upgrade established strengths, from food manufacturing in North Yorkshire to pharmaceuticals in Liverpool.
• Sustainability and a nature-positive transition: The bioeconomy is not inherently sustainable, but it can be designed to be. Specifically, embedding circularity and reducing resource intensity across established industries, backed by procurement, standards and skills development, can make growth and nature recovery work together.
• Investment: Private investment in UK bioeconomy companies reached £14.3 billion in 2023, up 7.5-fold in a decade. The UK does not lack capital; it lacks the mechanisms to connect it to opportunity.
• Resilience and security: The UK imports around 40% of its food and half its nature-related risks originate overseas. Long-term offtake agreements and advance market commitments would give firms the certainty to build capacity at home, cutting exposure to imported feedstocks, food shocks and volatile fossil fuel prices.
Why this matters
Without a coordinated policy and finance architecture, the UK risks falling behind its peers, greater exposure to shocks, and losing its most promising bio-based firms overseas. Taking leadership on the bioeconomy agenda would strengthen resilience and position the UK to lead on climate, food security and nature, especially in the run up to holding the G7 and G20 Presidencies.
