David Cameron will use a speech to lure business back to the UK, reversing the trend of "offshoring" - where businesses relocate manufacturing and customer service to countries where overall costs are cheaper.
The Prime Minister is hoping cheap energy from shale gas and a pro-business regulatory climate could be the key to persuading firms to move "re-shore" back to the UK.
In a speech at the World Economic Forum in Davos, the PM will say companies are most likely to continue to house production in India and China, but argue the West should not be "written off".
According to Government figures, some 1,500 manufacturing jobs have already come back to the UK since 2011, and Business Secretary Vince Cable was today launching a new service called Reshore UK to help firms which want to do the same.
Manufacturers expect an improved outlook this year which should lead to growth in exports and more investment in jobs, according to a new report.
A survey of 200 senior executives by EEF, the manufacturers' organisation and Aldermore Bank found a more positive outlook than the muted picture of a year ago, with growth expected in all markets and across all sectors and sizes of companies.
Two fifths of companies said they plan to invest in the UK, with a further fifth saying their investment would be significant.
EEF chief executive Terry Scuoler said: "Manufacturers are telling us they expect to make a greater contribution to growth, investment and jobs this year".
Production and manufacturing are up 1.1 per cent and 1.9 per cent respectively in May and June - the pace is picking up.
A £1.2 billion contract for new 140mph trains that will reduce journey times on key routes has been announced by the Government.
A total of 270 carriages will be manufactured in Britain as part of the Government's £5.8 billion Intercity Express Programme and the trains will be operational on the East Coast Main Line from 2019.
Capacity will be boosted by 18%, improving train reliability, and journey times between London, Leeds, Newcastle and Edinburgh cut by up to 18 minutes.
The plan is a boost for Hitachi Rail Europe's manufacturing facility in County Durham with 730 jobs set to be created by the order.
The growing import of goods from abroad instead of manufacturing them here has fuelled an increase in carbon emissions, according to the government's climate change advisers.
Official figures show that Britain's carbon emissions have fallen by around 20% over the last two decades, partly as a result of manufacturing moving overseas. But this data does not include the emissions produced in the making and transportation of goods we import to the UK.
The Committee on Climate Change report found that when emissions 'embedded' in the goods we consume are taken into account, there has actually been a 10% rise since 1993.
The report concludes that official figures should continue to track only the emissions produced within UK borders since this is what other countries do, but that imports should also be monitored.
The UK's hopes of avoiding a return to recession remain in the balance after the Office for National Statistics (ONS) released mixed figures on manufacturing and exports.
Economists were cheered by a month-on-month improvement of 0.8% in factory output for February, reversing some of the 1.9% slide in January.
But separate figures from the ONS also showed a widening in the UK's trade deficit, largely due to a 1.1% fall in exports amid weaker demand from the beleaguered eurozone.
The UK will duck its third recession since the start of the financial crisis if GDP figures on 25th April avoid a second quarter in a row of contraction.
An unexpected fall in UK manufacturing has raised new fears over the health of the economy.
The Purchasing Managers' Index measures activity in the sector. The latest figures suggest it is contracting much more quickly than anticipated.
ITV News Economics Editor Richard Edgar reports:
Police have been using water cannon to disperse protesting steel workers in the Belgian town of Namur.
The workers are demonstrating against the closure by ArcelorMittal of a coke plant and six production lines in Liege.