In the globalised economy, foreign investment plays an essential role in the economic and employment growth of a country, thus contributing to the development of innovation in industrial processes and services. They also bring significant benefits in terms of increased productivity, value added and business performance. A modern economy must open up to foreign capital in order to be part of the “global value chains”: foreign investment brings valuable capital even to those companies whose small size does not enable them to be competitive in international markets and introduces innovative working methods and greater familiarity with distant markets that would otherwise be difficult to penetrate.
FDI enables the recipient country to further specialize in sectors where it has a competitive advantage. Foreign investment is therefore an opportunity for industrialization and economic growth, both for the investing country and the recipient country (according to a win-win solution logic).
Foreign investment are indispensable in a production system like the Italian one, largely based on small and medium-sized enterprises (SMEs), when traditional financing channels (banking and from domestic sources) prove insufficient. Most Italian companies that have survived the long period of economic crisis of recent years have done so thanks to their ability to innovate and internationalize, including by being more open to foreign investment. Attracting direct investment, in fact, means increasing capital flows, boosting competitiveness, quality, and innovation in our industrial system, which is characterized by a high propensity for technological innovation and particularly advanced know-how, increasing employment levels and investment in research and development.
Foreign-controlled companies contribute significantly to the national export system (intra-group trade flows), and more generally to the commercial internationalization of our companies.
In most cases, investors’ interest is to leave production and especially the R&D phases in Italy, benefiting from the complementarity between the propensity for innovation and technological excellence of Italian companies and the operational capacity that potential partners guarantee.
Moreover, foreign companies in the last decade have produced a substantial growth in demand for patents, particularly in the manufacturing sector.
The Confindustria/ABIE (Advisory Board for Foreign Investors) report, “Large Foreign Enterprises in Italy”, divided into three volumes, has shown that every euro invested by foreign multinationals leads to 3.3 euros of overall growth in industrial production and 5 jobs for every job created by foreign enterprises in Italy.
In 2024, Italy is one of the top 20 countries in the world for foreign capital stock. with a total of over $493 billion. Its weight on GDP was 20.8%. In 2024, foreign direct investment (FDI) fell by 11% globally, with a particularly sharp decline in Europe. However, the outlook for Italy in 2025 promises a 48% increase in estimated investment compared to 2024, with a rebound that could exceed $35 billion.
According to UNCTAD data, from 2020 to 2024, Italy shows better resilience than other major European countries, such as Germany, France, and Spain.
Foreign-controlled companies in Italy account for 0.4% of resident companies, employ 9.8% of the workforce, and produce 21% of turnover and 17.5% of the added value of industry and services. They play a significant role in foreign trade in goods and private spending on research and development (over €6 billion). They account for 35.8% of national exports of goods and 49.7% of imports. There are 18,825 foreign multinationals in Italy, originating from 106 countries (Istat, 2023 data).
Mergers and acquisitions (M&A) in 2024 were valued at approximately $30 billion, representing very strong growth compared to 2023 ($4 billion). In the European context, the Italian market stood out in 2025 as one of the most dynamic markets, with a significant increase in transactions of +47% compared to the previous year. In 2025, there were over 55 deals worth almost $60 billion, particularly in the financial and consumer goods sectors.
Announced greenfield investments grew by 36% to $38.6 billion (UNCTAD data, WIR 2025)
In 2024, Italy recorded 224 announced investment projects, representing a 5% increase compared to 2023, for the second consecutive year. What makes this figure particularly significant is the negative trend in other European countries, which saw an average decline of 5% this year, with the three main continental economies—France, the United Kingdom, and Germany—all recording negative growth, demonstrating the consolidation of Italy’s attractiveness (EY Attractiveness Survey, 2025).
Italy’s political and economic stability is also strengthening the country’s attractiveness for private capital operators. The Italian market doubled its private capital investments in 2024 compared to the previous year, reaching €20 billion, and the share of foreign capital is now 27%, which is expected to increase thanks to growing competitiveness.