Investment promotion in Germany: What grants and subsidies are available?

Germany offers foreign and domestic investors a wide range of Support programs, Grants and Subsidiesto stimulate investment, support innovation and strengthen regional economic structures. Companies wishing to invest in Germany or relocate here can benefit from various financial aid and tax concessions benefit.

1. funding for investments in structurally weak regions (GRW grant)

The Program for the improvement of regional economic structures (GRW) offers financial support for companies investing in economically weaker regions of Germany.

Who can benefit?

• Companies that set up a new business premises in an assisted region
• Companies that expand or modernize existing locations
• Companies that create jobs in structurally weak regions

What subsidies are available?

• Investment grants of up to 40 % of eligible costs for small companies
• Up to 30 % for medium-sized companies
• Large companies can use up to 20 % Promotion receive

Example: A foreign company opens a production facility in eastern Germany and creates 50 new jobs. It can receive a grant for machinery, buildings and infrastructure.

2. funding programs for energy efficiency and climate protection

Germany offers companies attractive subsidies if they invest in energy-efficient technologies or make their operations more environmentally friendly.

Important programs:

• Federal subsidy for efficient buildings (BEG): Grants for the energy-efficient refurbishment of company buildings
• Energy efficiency in the economy: Promotion for the use of renewable energy in production processes
• Promotion of climate-friendly production facilities: Grants for energy-efficient machines

What subsidies are available?

• Up to 40 % promotion for investments in energy-efficient machines
• Up to 50 % promotion for building renovations (e.g. thermal insulation, heating modernization)

Example: A company replaces its old heating system with a modern heat pump and receives a state subsidy for this.

3. innovation and research funding (ZIM program)

The Central Innovation Program for SMEs (ZIM) supports companies that invest in research and development.

Who can benefit?

• Small and medium-sized enterprises (SMEs) that develop new products or technologies
• Companies that cooperate with universities or research institutions

What subsidies are available?

• Up to 45 % conveyance for research and development projects
• Promotion of cooperations between companies and research institutions

Example: A start-up develops a new environmentally friendly packaging technology and receives financial support for research, testing and patent registration.

4. promotion of start-ups and venture capital (INVEST grant for venture capital)

There are special support programs for young companies and investors to Supporting start-ups with capital.

Important funding programs:

• INVEST grant for venture capital: Private investors receive a grant when they invest in innovative start-ups
• EXIST start-up grant: Funding for start-ups from science

What subsidies are available?

• Up to 20 % of the invested capital as a subsidy for investors
• Up to €150,000 in funding for research-related start-ups

Example: A foreign investor finances a German tech start-up with €500,000. He receives a grant of €100,000 from the state.

5. tax incentives for investments

In addition to direct subsidies, Germany also offers Tax advantages for investors.

Important tax incentives:

• Special depreciation for investments: Companies can write off investments more quickly and thus reduce their tax burden
• Tax credits for research and development expenditure
• Reduced trade tax rate in certain regions

Example: A production company invests 1 million euros in new machinery. Special depreciation allows it to achieve high tax savings in the first few years.

6. agricultural and agribusiness promotion

Companies operating in the Agricultural sector or food production can benefit from special programs.

What subsidies are available?

• Promotion of sustainable agriculture (Investments in environmentally friendly cultivation methods)
• Grants for modern machinery and warehouse technology
• Promotion of organic products and sustainable food production

Example: A company builds a new production facility for organic food and receives state support.

7. funding for digital transformation and Industry 4.0

Companies that have expanded their production Digitize or automatecan benefit from state subsidies.

What subsidies are available?

• Funding for artificial intelligence (AI) and automation
• Subsidies for the expansion of digital infrastructure (cloud technologies, IT security)
• Support programs for the introduction of ERP systems and Industry 4.0

Example: A manufacturing company introduces a new, automated production line with AI-controlled machines and receives a grant for digitalization.