BERLIN (Reuters) - A record number of British businesses invested in Germany last year to help them to cope with the looming effects of Brexit, a study by a German government agency showed on Thursday, with the trend set to continue.
Britain is set to leave the 28 member European Union in March 2019, but with negotiations making slow progress it is unclear whether companies will enjoy access to the bloc’s internal market in some sort of customs union.
Some 152 firms moved from Britain to Germany last year, up more than 20 percent on 2016, the Germany Trade & Invest (GTAI) agency said.
“The effects of Brexit are gradually making themselves felt,” said GTAI expert Thomas Bozoyan, adding that Germany is the most attractive European country for British investment and second globally behind the United States.
GTAI said that an increasing number of companies are making enquiries about Germany and it expects investment growth to continue.
“The most exciting question is whether more production will be shifted from Britain to the continent,” said GTAI’s Iris Kirsch. So far, most investment has been made in the financial and services sectors, plus IT and software businesses.
Overall, 1,910 companies moved to Germany from abroad last year, bringing 29,000 jobs with them.
The biggest investor was the United States, spending on 276 projects and overtaking China with 218. In addition, 1,925 foreign investments were registered because of takeovers, mergers or stake acquisitions.
A record number of Britons were granted German citizenship last year, the Statistics Office said on Wednesday, citing the potential of Brexit to limit freedom of movement.
Writing by Madeline Chambers; Editing by David Goodman