Israel has overtaken Hong Kong as an investor in British industry.
Figures released by UK Trade & Investment place Israel in the top 20 countries investing in British companies.
Richard Salt, the director of UK Trade & Investment at the British Embassy in Tel Aviv, said he was delighted Israel had risen in the rankings.
He called on more Israeli companies “to act now to benefit from the huge investment opportunities on offer in the UK.”
Mr Salt added: “I and my team will do our utmost to help those companies to succeed."
In total 16 Israeli projects generated jobs in the UK over the 2009/10 period despite what Business Secretary Dr Vince Cable described as “a difficult year for inward investment”.
Although inward investment fell by ten per cent around Europe, the UK has enjoyed a record year as businesses from 54 countries launched projects here.
Prime Minister David Cameron said the government is committed to helping the world’s best companies thrive in Britain.
He said: “Attracting and retaining inward investment is hugely important for our economic recovery."
Israel is one of Britain’s largest export markets in the Middle East.
