Calculations by the German Economic Institute (IW), based on foreign direct investment transaction data from the Bundesbank and seen by Reuters, put total foreign investment in Germany at approximately €86 billion ($99.91 billion) last year.
The figure was nearly 11% higher than the median level recorded between 2015 and 2024, although economists caution that foreign direct investment can vary significantly from one year to another as companies adjust investment plans, complete major acquisitions or shift capital between markets.
The composition of Germany’s foreign investment also changed markedly in 2025. Britain emerged as the country’s largest single source of foreign capital, overtaking the United States after British companies dramatically increased their investments.
British firms invested around €26 billion in Germany during the year, representing an increase of approximately 284% compared with 2024. The surge gave Britain a share of nearly 31% of total foreign investment inflows into Germany.
The sharp rise in British investment came against the backdrop of a substantial retreat by U.S. companies. American investment in Germany fell by almost 44% year on year, declining to about €11.8 billion in 2025.
As a result, the U.S. share of total foreign investment in Germany dropped to roughly 14%, compared with more than 36% in 2024. The shift significantly altered the ranking of Germany’s major foreign investors and underscored the changing pattern of international capital flows into Europe’s largest economy.
Investment from other European Union countries remained an important pillar of Germany’s foreign investment position. Companies from other EU member states invested approximately €43 billion in Germany in 2025, despite a modest 2.7% decline from the previous year.
The EU contribution accounted for more than half of all foreign investment flowing into Germany, highlighting the continued importance of the European single market to German businesses and the country’s economy.
The figures suggest that while Germany continued to attract substantial amounts of international capital, the sources of that investment shifted considerably during 2025. The surge in British investment was particularly significant, helping drive overall inflows higher despite weaker investment from the United States.
Foreign direct investment is closely watched as an indicator of international confidence in an economy because it often involves companies establishing operations, expanding existing businesses, acquiring firms or committing capital to long-term projects.
For Germany, the increase in overall investment provides a positive signal after a period in which concerns about weak economic growth, high energy costs, industrial competitiveness and uncertainty in global trade have weighed on business sentiment.
However, the year-on-year figures should be interpreted with caution because individual large transactions can have a substantial impact on annual investment totals. The IW noted that foreign direct investment flows are capable of fluctuating sharply from year to year.
Still, the scale of Britain’s increase stands out. With British investment rising by more than four times its 2024 level, the United Kingdom became Germany’s biggest individual foreign investor in 2025, while the United States’ position weakened considerably.
The figures therefore point not only to stronger overall foreign investment in Germany but also to a notable reshaping of the country’s international investment landscape.