Expansion is main reason for foreign investment, power prices not high priority
Half of Germany’s large enterprises (annual turnover of more than 500 million euros) made foreign investments of an average 125 million euros in 2014, the Foreign Investment Monitor by development bank KfW shows. Investment at home was at an average 135 million euros per company. “The main motivation to invest outside national borders is to expand, that is, to open up new markets,” the report says, with 87 percent of businesses attaching high or very high importance to this reason. 18 percent of businesses saw electricity costs as an important motivation for their 2015-2017 foreign investments; 39 percent named labour costs. The money invested abroad was primarily used to expand or modernise existing facilities; nine out of ten companies regarded it as complementary rather than a substitute for domestic investment. The main locations of foreign investment by German firms were in Europe, followed by Asia and North America.