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Germany’s Appeal to Investors Declines to Lowest Level
(MENAFN) Germany’s appeal to foreign investors has slipped to its weakest point since 2017, according to a new survey released by KPMG on Wednesday. The report attributes this decline to elevated energy expenses, heavy bureaucracy, and ongoing shortcomings in infrastructure, all of which are reducing the country’s overall competitiveness.
The study, titled Business Destination Germany 2026, draws on responses from 400 chief financial officers working for major German branches of multinational corporations based in the eight most important investor nations.
KPMG’s location index, which evaluates Germany against other European Union countries using more than 20 criteria, fell to 0.2 points in 2026. This marks a drop from 1.2 in 2023 and a significantly higher 3.1 in 2017, on a scale ranging from +10 to -10. The latest figure positions Germany only marginally above the EU average.
Despite this downward trend, Germany still retains several key advantages, including a large domestic market, strong public security, political steadiness, and solid innovative capabilities, the survey found. Around 60 percent of respondents indicated that they use Germany as their European headquarters, while 63 percent also oversee business activities outside Europe from within the country.
Even so, participants pointed to underlying structural problems that continue to weaken Germany’s competitiveness and limit its attractiveness as a global investment destination.
The study, titled Business Destination Germany 2026, draws on responses from 400 chief financial officers working for major German branches of multinational corporations based in the eight most important investor nations.
KPMG’s location index, which evaluates Germany against other European Union countries using more than 20 criteria, fell to 0.2 points in 2026. This marks a drop from 1.2 in 2023 and a significantly higher 3.1 in 2017, on a scale ranging from +10 to -10. The latest figure positions Germany only marginally above the EU average.
Despite this downward trend, Germany still retains several key advantages, including a large domestic market, strong public security, political steadiness, and solid innovative capabilities, the survey found. Around 60 percent of respondents indicated that they use Germany as their European headquarters, while 63 percent also oversee business activities outside Europe from within the country.
Even so, participants pointed to underlying structural problems that continue to weaken Germany’s competitiveness and limit its attractiveness as a global investment destination.
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