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The United Kingdom withdrew from the EU on 31 January, 2020. The 2020 edition of the Single Market Scoreboard refers to time periods preceding the withdrawal of the UK, and the UK is therefore listed as a Member State.

Foreign Direct Investments

Reporting period:
2017 - 2018

Foreign direct investment (FDI) is a category of cross-border investment in which an investor resident in one country establishes a lasting interest in and significant degree of influence over (ownership of 10 % or more of the voting power), a business resident in another country.

FDI is a driver of competitiveness and economic development. Information on its evolution over time provides an indication of an EU Member State’s external competitiveness and the effectiveness of economic, trade and investment policies.

FDI and Single Market – why does it matter?

FDIs are a component of the investments made into an economy. As such, they can play a role in spurring economic growth and the creation of jobs in the receiving economy. Moreover, the level of FDI may indicate – among many other factors – a particular attractiveness or competitiveness of an economy. Measuring the levels and trends of FDIs in the EU’s Single Market is thus a relevant exercise in order to assess the latter’s performance and attractiveness.

Key messages

Overall, the 2018 data presented below show that FDIs are unevenly distributed across EU Member States. Some small countries exhibit very high stocks of both intra-EU and extra-EU FDIs. On the contrary, certain large western European economies present comparatively lower figures, and most eastern European countries lie in the lower part of the distribution of FDI stocks.

Facts and figures

All indicators are based on official statistics from Eurostat.

Inward and Outward EU FDIchanges 2017-2018

The following indicators measure percentage changes in FDI flows and stocks between 2017 and 2018.

Change in inward intra-EU FDI flows

Change in the level of inward intra-EU FDI flows between 2017 and 2018, for each EU Member States.

Increases or decreases may indicate - among other factors - changes in a country’s relative attractiveness for investors.

Change in outward intra-EU FDI flows

Change in the level of outward intra-EU FDI flows between 2017 and 2018, for each EU Member States.

Increases or decreases may reflect – among other factors – policy measures taken abroad that modified incentives or barriers to investment.

Change in inward intra-EU FDI stocks

Change in the level of inward intra-EU FDI stocks between 2017 and 2018, for each EU Member States.

Change in outward intra-EU FDI stocks

Change in the level of outward intra-EU FDI stocks between 2017 and 2018, for each EU Member States.

Change in inward extra-EU FDI flows

Change in the level of inward extra-EU FDI flows between 2017 and 2018, for each EU Member States.

Increases or decreases may indicate – among other factors – changes in a country’s relative attractiveness for investors.

Change in outward extra-EU FDI flows

Change in the level of outward extra-EU FDI flows between 2017 and 2018, for each EU Member States.

Increases or decreases may reflect – among other factors – policy measures taken abroad that modified incentives or barriers to investment.

Change in inward extra-EU FDI stocks

Change in the level of inward extra-EU FDI stocks between 2017 and 2018, for each EU Member States.

Change in outward extra-EU FDI stocks

Change in the level of outward extra-EU FDI stocks between 2017 and 2018, for each EU Member States.

Inward and Outward EU FDIlevels

Inward intra-EU FDI flows – levels

This indicator measures the level of inward intra-EU FDI flows, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator, which reflects flow data, is volatile and may change significantly from one year to the next.

Outward intra-EU FDI flows – levels

This indicator measures the level of outward intra-EU FDI flows, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator, which reflects flow data, is volatile and may change significantly from one year to the next.

Inward intra-EU FDI stocks – levels

This indicator measures the level of inward intra-EU FDI stocks, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator is relatively stable and less volatile than indicators of flow data.

Outward intra-EU FDI stocks – levels

This indicator measures the level of outward intra-EU FDI stocks, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator is relatively stable and less volatile than indicators of flow data.

Inward extra-EU FDI flows – levels

This indicator measures the level of inward extra-EU FDI flows, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator, which reflects flow data, is volatile and may change significantly from one year to the next.

Outward extra-EU FDI flows – levels

This indicator measures the level of outward extra-EU FDI flows, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator, which reflects flow data, is volatile and may change significantly from one year to the next.

Inward extra-EU FDI stocks – levels

This indicator measures the level of inward extra-EU FDI stocks, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator is relatively stable and less volatile than indicators of flow data.

Outward extra-EU FDI stocks – levels

This indicator measures the level of outward extra-EU FDI stocks, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator is relatively stable and less volatile than indicators of flow data.

Priorities

To improve investment performance in the EU, 3 obstacles need to be tackled:

  1. Regulatory stability needs to be strengthened and unnecessary administrative burdens need to be reduced.
  2. The remaining obstacles to access to finance, especially for small and medium-sized firms and start-ups, need to be tackled and access to equity and venture capital improved.
  3. Single market barriers that restrict firms seeking to open branches or buy up companies in other EU countries may limit opportunities involving more than one EU country, expansion of new business models and investment.

The EU seeks to boost investment using the following instruments:

Facts and figures

All indicators are based on official statistics from Eurostat.

Inward and Outward EU FDIchanges 2017-2018

The following indicators measure percentage changes in FDI flows and stocks between 2017 and 2018.

Change in inward intra-EU FDI flows

Change in the level of inward intra-EU FDI flows between 2017 and 2018, for each EU Member States.

Increases or decreases may indicate - among other factors - changes in a country’s relative attractiveness for investors.

Change in outward intra-EU FDI flows

Change in the level of outward intra-EU FDI flows between 2017 and 2018, for each EU Member States.

Increases or decreases may reflect – among other factors – policy measures taken abroad that modified incentives or barriers to investment.

Change in inward intra-EU FDI stocks

Change in the level of inward intra-EU FDI stocks between 2017 and 2018, for each EU Member States.

Change in outward intra-EU FDI stocks

Change in the level of outward intra-EU FDI stocks between 2017 and 2018, for each EU Member States.

Change in inward extra-EU FDI flows

Change in the level of inward extra-EU FDI flows between 2017 and 2018, for each EU Member States.

Increases or decreases may indicate – among other factors – changes in a country’s relative attractiveness for investors.

Change in outward extra-EU FDI flows

Change in the level of outward extra-EU FDI flows between 2017 and 2018, for each EU Member States.

Increases or decreases may reflect – among other factors – policy measures taken abroad that modified incentives or barriers to investment.

Change in inward extra-EU FDI stocks

Change in the level of inward extra-EU FDI stocks between 2017 and 2018, for each EU Member States.

Change in outward extra-EU FDI stocks

Change in the level of outward extra-EU FDI stocks between 2017 and 2018, for each EU Member States.

Inward and Outward EU FDIlevels

Inward intra-EU FDI flows – levels

This indicator measures the level of inward intra-EU FDI flows, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator, which reflects flow data, is volatile and may change significantly from one year to the next.

Outward intra-EU FDI flows – levels

This indicator measures the level of outward intra-EU FDI flows, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator, which reflects flow data, is volatile and may change significantly from one year to the next.

Inward intra-EU FDI stocks – levels

This indicator measures the level of inward intra-EU FDI stocks, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator is relatively stable and less volatile than indicators of flow data.

Outward intra-EU FDI stocks – levels

This indicator measures the level of outward intra-EU FDI stocks, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator is relatively stable and less volatile than indicators of flow data.

Inward extra-EU FDI flows – levels

This indicator measures the level of inward extra-EU FDI flows, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator, which reflects flow data, is volatile and may change significantly from one year to the next.

Outward extra-EU FDI flows – levels

This indicator measures the level of outward extra-EU FDI flows, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator, which reflects flow data, is volatile and may change significantly from one year to the next.

Inward extra-EU FDI stocks – levels

This indicator measures the level of inward extra-EU FDI stocks, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator is relatively stable and less volatile than indicators of flow data.

Outward extra-EU FDI stocks – levels

This indicator measures the level of outward extra-EU FDI stocks, for each EU Member State, in the years 2016, 2017 and 2018.

The indicator is relatively stable and less volatile than indicators of flow data.

More information on FDI – detail and analysis

Foreign direct investment (FDI) is key to internationalisation and integration in Europe. It is also one of the main components of total investment as measured by Gross Fixed Capital Formation.

The indicators show the volume of:

They reflect:

Data on FDI flows are on a net basis (credits less debits between direct investors and their foreign affiliates).

Negative FDI flow data indicate reverse investment or disinvestment in which at least 1 of the 3 components of FDI (equity capital, reinvested earnings or intra-company loans) is negative and not offset by positive amounts of the remaining components.

Changes in flow and stock data over time could reflect changes in the framework and investment conditions in the country and/or abroad due to policy measures taken to strengthen incentives for or reduce barriers to investment.

FDI positions between the beginning and the end of a given year (n) may change due to factors as:

However, changes in the volume of FDI can be misleading. What can happen is that an economic entity’s “portfolio positions” for a particular year can be reclassified as “direct investment” if it acquires additional shares pushing its ownership above the 10 % threshold.

FDI Glossary

FDI flows

FDI flows record the value of cross-border transactions related to direct investment during a given period of time. Financial flows consist of equity transactions, reinvestment of earnings, and intercompany debt transactions.

FDI stocks

FDI stocks measure total direct investment at a given point in time. The outward FDI stock is the value of the resident investors' equity in and net loans to enterprises in foreign economies. The inward FDI stock is the value of foreign investors’ equity in and net loans to businesses resident in the reporting economy.