BRITISH investment in Germany has soared thanks to the ‘Brexit effect’ as UK firms and investors prepare for a hard exit from the bloc, according to new figures.

Following figures outlining how a record number of British citizens applied for German passports, the number of British Foreign Direct Investments (FDI) in Germany jumped by a fifth in 2017 according to numbers released by the German government.

The new set of figures, released on Thursday, indicate the number of UK investment projects in Germany rose by 21 percent in 2017 – the highest jump in UK investment in Germany recorded in the last decade.

1,910 new projects were set up by foreign companies in Germany in 2017, which the GTAI estimates will create 29,000 additional jobs in the booming economy.

The Germany Trade & Invest (GTAI) development agency said new figures could be down to what was dubbed “Brexit effect”, as UK companies brace themselves for the possibility of a “hard” Brexit.

But so far, companies are only embarking on new office locations – although analysts believe the new projects could be a forerunner for production facilities and permanent headquarters.

Thomas Bozoyan, Manager of Research at GTAI, told The Local: “We believe this is that effect in that some firms or investors are ensuring they are covered should it come to a ‘hard Brexit’”.

“The number of British firms moving capital into Germany reflects the current stability of the German investment scene.

“In many cases it is simply a hedging strategy where firms have investments both sides of the potential Brexit border. Nobody knows what will really happen over the next few months, so it’s wise to have a wider portfolio of investments.”

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THE GTAI also confirmed that the volume of new enquiries from UK businesses had “risen sharply”.

The UK was also the largest source for merger, acquisition and shareholding investment in Germany last year, while the GTAI says the volume of enquiries from the UK has “risen sharply.”

Mr Boyzan said: “We are convinced that this increase in British FDI activity is a direct consequence of the Brexit decision. It’s a part of a larger trend, which has seen British FDI across Europe increase by 33 percent.”