Cutting edge medical businesses in Birmingham are set to catch the eye of high-powered investors in the next five years, a senior venture capitalist has claimed.
That comes as another expert said the aerospace sector in the region is due to benefit from a bounce-back after the September 11 New York terror attacks.
Chief executive of the British Venture Capital Association Peter Linthwaite said Birmingham had always had a background of strong business within the city.
He described the economy in the area as vibrant and continuing to attract venture capitalists.
Looking forward, he said investment in university research and development was set to pay dividends in the region.
The city was particularly strong in the medical sector.
He said "This is a slow burn situation but I expect to see significant progress in that area in the next five to six years."
Matthew Caffrey, of Isis Equity partners in Birmingham, said the aerospace sector had previously seen substantial investment in the region.
Orders were now starting to come back after September 11 and he said the Midlands was set to benefit.
The two were speaking at a press briefing in Birmingham.
They both believe venture capitalists would continue to show interest in companies delivering results in niche engineering and manufacturing areas.
Their comments came as the Organisation for Economic Cooperation and Development said the UK was the world's largest recipient of foreign direct investment in 2005.
UK FDI inflows surged to a record $164.5 billion (£90.3 billion) last year, from $56.3 billion (£30.9 billion) in 2004.
The OECD said the strong rise in UK FDI inflows was partly the result of the restructuring of multinational firms and partly due to large cross-border mergers and acquisitions.