Foreign direct investment (FDI) in Europe declined in 2025, marking a period of slowdown and structural transformation in the investment landscape. The number of announced projects was 7% lower than in 2024 and remains significantly below peak-period levels, against a backdrop shaped by moderate economic growth, high energy costs, geopolitical uncertainty, and more difficult access to financing.
FDI is increasingly concentrated in less labour-intensive activities, while the number of jobs generated has almost halved compared with the 2021 peak. This trend reflects both the decline in the number of projects, by 15%, and the reduction in their average size, with the number of jobs per project falling from around 70 to 40.
At the same time, the share of large projects creating more than 500 jobs fell to 30%, compared with 48% in 2021, reaching its lowest level since 2017 and confirming investors’ shift towards more automated and productivity-efficient projects.
Despite the broader European decline, Romania recorded a stronger performance in 2025, attracting 109 foreign direct investment projects, up 16% year-on-year, while the number of jobs generated rose by 39%, to 5,710. The figures point to a consolidation of Romania’s position in Central and Eastern Europe, supported by the rising share of expansion projects and renewed commitments from investors already present on the local market.
“In 2025, foreign direct investment reflects a clear paradigm shift at European level, where investment decisions are becoming more selective, and criteria related to competitiveness and predictability carry more weight than in previous years. In this context, Romania’s evolution, with a 16% increase in the number of projects and a 39% rise in jobs generated, in a year when most European markets recorded declines, indicates a consolidation of its position in the region. The high share of expansion projects and the return of FDI inflows to EUR 8.1 billion suggest that existing investors are reaffirming their long-term commitments. Maintaining this trend will depend on the ability to ensure predictability, political stability, and coherence in public policies, in a context in which indicators from the first part of 2026 show an increase in Romania’s attractiveness, based on M&A data, while the prospect of OECD accession could further increase the country’s potential to attract FDI,” said Bogdan Ion, Country Managing Partner, EY Romania and Moldova.
Regional differences deepen
Western Europe remains the leader by project volume, with France, at 852 projects, down 17%, the United Kingdom, at 730, down 14%, and Germany, at 548, down 10%, at the top of the ranking. However, the region recorded declines in both the number of investments and the jobs generated, confirming a trend of market maturity.
Southern Europe had a mixed evolution: Spain led the region with 376 projects, up 7%, while Italy, at 206, down 8%, and Portugal, at 186, down 5%, recorded declines. Greece stood out through an accelerated increase in jobs, up 374%, indicating a more employment-intensive investment profile.
Central and Eastern Europe is strengthening its position, particularly through industrial investment and a higher number of jobs per project. Poland led with 285 projects, up 10%, followed by Romania, with 109 projects, up 16%, and Hungary, which attracted fewer projects, 73, down 9%, but generated a high number of jobs, highlighting the region’s competitiveness in attracting large-scale investment.
At sector level, investment is dominated by services and technology. In 2025, the Software and IT services sector led with 857 projects, up 8%, followed by Business and professional services, with 716 projects, up 4%, while the financial sector recorded the fastest growth, reaching 355 projects, up 21%.
By contrast, most industrial sectors recorded declines compared with previous years, including Transport and logistics, down 14%, Electronics, down 13%, Healthcare, down 15%, Automotive, down 8%, and Chemicals, plastics, and rubber, down 11%, reflecting pressures related to demand, costs, and financing conditions.
Emerging fields such as artificial intelligence, low-carbon energy, and defence are attracting increasing investment. FDI projects in artificial intelligence almost doubled, from 156 in 2024 to 306 in 2025, up 96%, while jobs increased by 41%, to 14,693.
In the low-carbon energy sector, the number of projects increased from 71 to 89, up 25%, but the jobs generated fell significantly, from 5,565 to 2,039, down 63%, reflecting the more automated nature of these investments.
Defence investment grew strongly, with the number of projects reaching 107, up 84%, and jobs generated rising to 6,887, up 118%, against the backdrop of Europe’s strategic shift towards security and industrial resilience.
Against this background, investor confidence remains positive, but is moderating, affected by risks such as geopolitical tensions, macroeconomic conditions, trade barriers, and regulatory complexity.
Romania: performance above European trend, stronger investment profile
In this challenging European context, Romania stands out with an evolution above the regional average, both in terms of the number of FDI projects and jobs generated.
In 2025, Romania ranked 11th in Europe and attracted 109 foreign direct investment projects, up 16% compared with the previous year, in contrast with the decline observed at European level. At the same time, the number of jobs created increased by 39%, reaching 5,710, indicating a recovery in investments with an impact on the economy.
A defining element of this evolution is the change in the structure of investment. Expansion projects became dominant, exceeding new projects. The number of expansion projects increased from 31 in 2024 to 60 in 2025, a 94% rise, signalling stronger confidence among investors already present on the market, who are choosing to develop their existing operations.
This dynamic suggests a maturing market: expansion decisions reflect investors’ direct experience in the local environment and confirm the relative stability of operating conditions.
At regional level, Romania is consolidating its position in Central and Eastern Europe, standing between Poland, which leads by scale, with 285 projects in 2025, up 10%, and Hungary, which attracts a smaller number of projects, 73, down 9%, but larger projects with a significant impact on employment.
Romania stands out through more balanced growth, distributed across several sectors, which reduces dependence on the cycles of a single field.
The sectoral structure of investment confirms this mixed profile. Of the 109 FDI projects announced in 2025, the Machinery and Equipment sector remained the largest, with 17 projects, accounting for 16% of the total, followed by Software and IT services, with 14 projects, or 13%, Transport and logistics, with 13 projects, or 12%, and the Transport manufacturers and suppliers and Agri-food sectors, each with 12 projects, or 11%. Overall, this mix indicates Romania’s growing role both as a production base and as a platform for regional operations and integration into European supply chains.
The geographical distribution of investment also shows a clear differentiation between Bucharest and the rest of the country. Bucharest-Ilfov leads by number of projects, with 45, but generates a relatively small number of jobs, 754, or around 17 jobs per project, reflecting the profile of investment in services and support activities. By contrast, the West, Centre, North-West, and South-West regions account for most of the jobs created, for example North-West, with 1,375 jobs from 14 projects, Centre, with 1,108 from 13 projects, West, with 909 from 11 projects, and South-West Oltenia, with 737 from only 4 projects, highlighting their role as main hubs for industrial investment.
Overall, the 2025 evolution indicates a consolidation of Romania’s role in the European investment landscape, against the backdrop of regional economic reorganisation and a growing orientation towards operational efficiency and integration into supply chains.