Achim Hartig, Director of Foreign Direct Investment at Germany Trade & Invest (GTAI) and Chair of the OECD Network of Investment Promotion Agencies, discusses Germany’s evolving investment priorities, spanning healthcare, energy, digital technologies and mobility. He highlights the country’s strengths in innovation, skilled talent and industrial ecosystems, while emphasising the need for greater European collaboration, resilient value chains and increased transparency to attract foreign investment in an increasingly competitive global landscape.
Could you introduce yourself?
At Germany Trade and Invest, I am responsible for attracting foreign direct greenfield investment, working alongside a team of around 80 employees worldwide focused on bringing in investment that supports the German economy. I am an economist by training, spent a considerable period working in banking, and also have an artistic background, all of which I find useful in shaping strategies to attract investment and market the country as a business location. Alongside my role at GTAI, I have been elected chair of the OECD Network of Investment Promotion Agencies, an important platform across OECD countries for exchanging best practice, peer learning, and feeding practical experience from investment promotion agencies back into policy design.
We operate as a private limited company, a GmbH, with a single shareholder, the Federal Ministry for Economic Affairs and Energy.
How does GTAI prioritise across industries, and what sits at the top of your agenda today?
Our organisation has two core objectives. The first is helping the German Mittelstand, and the wider economy, export goods and services, primarily by providing information on foreign markets, a pull-based service that companies draw on as needed. The second, which I lead, is investment attraction, where we operate more like a consulting firm, handling sales, advisory work and site selection to help foreign companies establish themselves here. We also run cross-functional programmes tied to specific government initiatives supporting exports or locations in particular segments, which feed into our broader offering.
In terms of structure, our teams are organised around the strengths of the German economy, so that our people can speak credibly with industry leaders. We have teams covering chemicals and healthcare, mechanical and electronic technologies, energy and digital technologies, among others. Crucially, these teams are reconfigured periodically, roughly every one to two years, based on a set of core questions: which industries are under distress and need support, which have high barriers to entry, meaning they cannot be easily replaced by new entrants, and among those, which have value chains that could genuinely benefit from foreign direct greenfield investment. Only once we have answered those questions do we ask whether we have the expertise and capacity to serve that industry well. That process consistently points to a defined set of five strategic industry priorities.
At present, these are mobility, which extends well beyond electric vehicles to the broader transformation of the transport sector, including air and water-based mobility, since Germany’s automotive industry has been somewhat slow to make that shift. The second is energy and resources: on the energy side, almost exclusively renewables, covering generation, transport, storage, grid management and batteries; on the resources side, building resilience by securing critical raw materials within Germany and Europe, largely through circular economy activities such as battery recycling and recovering materials from industrial waste streams. Third is digitalisation and future technologies, with two focus areas: artificial intelligence and quantum computing, alongside electronics and automation, covering robotics, industrial automation and semiconductors, including value chains around silicon, the forth one is Elenctronics and Automation covering the Semiconductor industries as well as manufacturing with automation and robotics. Healthcare forms our fifth pillar.
Could you say more about the strategic importance of healthcare, given it stands as its own pillar? Is this a newer priority, or a longstanding one?
This has been a priority for many years. Germany has a substantial population, which provides a strong client base, and its pricing system for new medicines has long been attractive, offering price guarantees for innovative treatments. More recently, the ability to access electronically collected patient data has become a significant draw, particularly for research and development in biotech and pharmaceuticals, given that the scale of data available in Germany remains largely unmatched. This makes the country attractive both for genuinely innovative research and for generic manufacturing that could be relocated here, as well as for standard medication production more broadly.
Your annual report noted a decline in foreign direct investment compared to the previous year. Could you tell us more about that?
Globally, greenfield foreign direct investment declined in 2025, and it is worth distinguishing this from capital flows, which is a separate measure entirely. Within the European Union, the decline was around 18 percent, while Germany saw a reduction of about 9 percent, which reflects the country’s more diversified risk profile. With more than three million small and medium-sized enterprises, no single industry’s setback can undermine the whole economy, which allows us to mitigate risk more effectively. Roughly 1,700 companies establish operations in Germany each year, a figure that held steady even through the pandemic and its aftermath, so this marks the first year we have seen an actual decline.
Looking more broadly, what trends are you seeing in investor sentiment, particularly given the mixed signals around Germany’s healthcare sector and questions about how innovation is being valued?
From a company perspective, one would naturally want to explore as many locations as possible, but there are relatively few places worldwide offering comparable market size, innovation capacity and skilled workforce to Germany, and I believe this remains one of the country’s core strengths in healthcare too. We saw this recently in Rhineland-Palatinate, where BioNTech reduced staff following a shift in its business model, prompting some concern, but as far as I understand, the company is already in discussions with interested buyers, precisely because the workforce is highly qualified and the equipment reflects the latest technology. That research and development base, which is mission-critical for long-term growth in the pharmaceutical industry and for retaining intellectual property, remains strong in Germany. What we genuinely need is to bring more bulk production of generics, currently manufactured elsewhere, back into Germany as a resilience factor for Europe.
Given the growing global competition for investment and research and development, and pressure from the US around drug pricing, what should Germany and Europe be focusing on to avoid falling behind?
Transparency about existing expertise and industries is essential. I am engaging with the European Commission to build momentum among member states to present value chains collectively. At present, investors from outside Europe may recognise France or Germany individually for pharmaceuticals, but they are far less likely to see the complementary advantages different European countries offer, whether in labour cost efficiency, research and development expertise, or available land for production. Connecting those dots across Europe, not only in pharmaceuticals but across other mission-critical industries, is a substantial task, but one that needs to be done.
At GTAI, we are contributing to this effort through two channels. The first is the OECD Network of Investment Promotion Agencies, which gives us a platform to map out which industries and value chains different countries are focused on, since none of us fully understands our own value chains in isolation, with the aim of building toward a shared European approach in at least some sectors, recognising that not every country will be equally willing or able to participate at first. The second is a more focused working group of European investment promotion agencies, where we go beyond methodology to examine actual figures and statistics, identifying strengths and weaknesses. I see this as an important grassroots step in building a clearer picture of what Europe has to offer and how to promote it collectively.
In your work attracting investment to Germany specifically, what is the biggest challenge you face?
The consistent challenge is communicating the complexity of the business environment clearly. Companies interested in Germany need to understand how different factors, energy prices, transaction costs, regulatory timelines, permitting processes, translate into their specific business case. Investment hurdles should really only exist at the outset, before there is transparency about how things work, and it is the role of an investment promotion agency to create as much of that transparency as possible.
Looking ahead two to three years, what are GTAI’s key strategic priorities, particularly given the current moment for Germany and Europe?
Establishing a genuine European investment promotion platform is crucial. Understanding ourselves as strong nations that are also competitors within Europe, while recognising the imperative to work together, is probably the most important shift needed over the next few years.
On Germany specifically, the pattern that prevailed before the pandemic, where companies would establish a presence here while scattering value chains globally based purely on cost, has changed. The cheapest locations are no longer automatically the preferred ones, and considerations around human rights, environmental protection and sustainability now shape how value chains are organised, pushing nations toward greater resilience. What I have observed, both in Germany and elsewhere, is that local ecosystems are becoming increasingly important, functioning as self-contained units within a larger value chain. When foreign companies see these ecosystems working well, it becomes far easier for them to connect and build a business case around them, rather than piecing together fragmented, geographically scattered production.
Your annual report also noted China overtaking the US in terms of foreign direct investment. What broader shifts have you observed, and how are they affecting Germany’s position?
It is notable that we are seeing rising numbers of US R&D coming to Germany, even as greenfield investment from the US declines. This reflects current US trade policy: high tariffs mean companies must produce within the tariff zone itself, effectively localising value chains that would otherwise not need to be, since this runs counter to the efficiencies of free global trade. Beyond that, the unpredictability created by the current US administration undermines a key element of any investment environment, namely planning security and cost certainty. This has two consequences. Only larger companies can still afford to invest elsewhere, which is reflected in the rising average size of greenfield projects, and small and medium-sized enterprises, the backbone of most economies, increasingly struggle to expand internationally because they are preoccupied with managing cost pressures at home.
One thing that has struck us here is the sheer scale of the Mittelstand in Germany. Given that part of your role is helping German companies expand internationally, what can you tell us about their capacity to do so, and how you support that?
I am consistently struck by the history of the German Mittelstand. Some of these companies are 400 to 600 years old, having survived wars, changes of regime, pandemics and economic crises, and continuing to operate today. While not overwhelming in number, they represent a significant presence across the chemical, financial services and manufacturing industries, and I believe their survival reflects a certain DNA: the ability to adapt and innovate. That, in turn, rests on two further elements: process excellence, meaning a deep, precise understanding of one’s own operations, and the capacity to adapt that understanding as circumstances change, which is itself a form of innovation. These qualities have allowed the German Mittelstand to endure, expand, and produce more than 1,600 world market leaders across a wide range of products and services, making them reliable partners for foreign companies, since a business that has survived this long is likely to remain a dependable presence going forward. The model has thrived because exports have historically fuelled Mittelstand growth, though conditions are somewhat more difficult now. German companies view Germany’s business environment differently than foreign investors do, given their different starting points, and while established companies retain a solid base for exporting and looking abroad, more traditional firms can find it harder to reorient their strategies quickly enough to benefit from a changing landscape, particularly as access to certain markets narrows while other opportunities open up.
What message would you like to share on behalf of GTAI to potential international investors?
Every company must grow to remain successful, and growth depends on competitiveness, which in turn depends on strong products and services, profitability, and access to the right resources, whether intellectual property, materials or otherwise. Germany will not automatically be the right location for every company, but once a business begins to outgrow its home market, it will need to look elsewhere, and I would encourage international companies to consider Europe as a whole: a region of 500 million potential consumers, offering meaningful diversification and a market considerably larger than the United States. Within that, Germany naturally has its own case to make as a business location, and we are always glad to help companies understand what that looks like in practice.
To close on a positive note, what excites you most about what lies ahead?
I find myself genuinely excited by technological developments capable of improving both society and the economy. Rather than speak too broadly, I would point to fusion technology as a particular area of interest for us: research aimed at recreating the processes that power the sun to generate clean, eventually low-cost and effectively limitless energy. Germany is home to three world-leading fusion installations, and one of them may be far enough along that market readiness becomes feasible within 20 to 30 years. That remains a long horizon, but given the decades-long nature of this kind of development, it represents a substantial step forward.
