Foreign direct investment into Germany fell 10% to 548 projects in 2025, marking a 17-year low, according to an EY survey.
High taxes, labor costs, and energy expenses continue to weigh on investment decisions. Rigid bureaucracy remains unreformed.
Germany remains Europe's third most attractive investment destination, behind France and the UK.
Henrik Ahlers, EY Germany head, noted: "While France and the UK have shown upward trends, Germany's economy has moved downward for years."
Poor sales and profits, along with uncertain economic conditions, are forcing companies to postpone or cancel investments.
