A recent study conducted by the Institute of the German Economy (IW) reveals a concerning trend: foreign investment in Germany has plummeted to its lowest levels in a decade. According to the report, foreign companies invested a mere 22 billion euros in Germany in 2023, marking a significant decline in capital influx. Concurrently, German businesses are showing a preference for expanding within the European Union rather than investing domestically.

The net outflow of investments from Germany totaled a staggering 94 billion euros in the same period, as highlighted by the IW. This figure represents the disparity between investments made by German companies abroad and those by foreign entities in Germany. Notably, the outflows recorded in 2021 and 2022 were even higher, indicating a concerning trend of diminishing foreign interest in German markets.

The implications of decreased foreign investments extend beyond economic concerns, potentially signaling a broader trend of deindustrialization.