Google announces $6.4 billion investment in Germany

(Patria) - Google has announced its largest ever investment in Germany, pledging 5.5 billion euros for a new data center and other projects, as Europe seeks to catch up in the race for artificial intelligence (AI), AFP reported.

This comes after AI chip giant Nvidia and Deutsche Telekom announced plans last week for a high-tech hub in Germany aimed at helping industry accelerate AI adoption.

The cash injections are a boost for Germany, whose economy is struggling, as well as for Europe, which is trying to catch up with AI leaders, the United States and China.

"We are driving growth in Germany," said Chancellor Friedrich Merz as Google announced the investments, which are expected to be realized by 2029.

"Our country is and will remain one of the most attractive places for investment in the world," Merz said.

Google's plans include a new data center and the expansion of an existing center in the western state of Hesse, which will provide computing power for artificial intelligence.

It also plans to expand its offices in Berlin, Frankfurt, and Munich, and has presented various projects aimed at reducing greenhouse gas emissions.
This included the purchase of renewable wind and solar energy and a "heat recovery project" that would allow local residents to reuse excess heat generated at the data center.

The plans will support around 9,000 jobs annually in Germany, Google said.

"Google is deepening its roots in Germany, expanding our investments in the country and creating new pathways for AI-driven transformation," said Philipp Justus, Google's Germany manager.

Boosting the digital sector

Merz's coalition, which took power this year, is seeking to attract more foreign investment to boost the digital sector, as the outlook for the country's traditional industrial titans becomes increasingly bleak.

The recently announced Nvidia project includes an investment of one billion euros for a computing center in the southern city of Munich, designed to give European companies, from large industrial players to startups, better access to artificial intelligence.

Germany is rapidly building its data centers. By 2030, the country's data center computing power will increase by seventy percent, according to the digital business association Bitkom.

Europe still lags significantly behind. Last year, data centers on the continent had a computing capacity of 16 gigawatts compared to 48 in the US and 38 in China, according to group data.

While the investments will be very welcome in Germany, as Merz seeks to revive the economy, some are still concerned about reliance on American tech giants in sensitive areas such as artificial intelligence.

Increasingly strained ties between Europe and the US since President Donald Trump returned to power have fueled calls for greater "digital sovereignty," meaning the region's data should be stored at home, where European rules and norms apply, rather than handed over to American firms.

Google nodded to these concerns on Tuesday, emphasizing in its announcement that it offers "sovereign" cloud computing that allows customers to adopt "AI capabilities while adhering to local requirements and European values."

Kristina Sinemus, a senior official responsible for digital affairs in Hesse, also sought to allay concerns that cooperation with American tech giants could compromise data security.

"We are not automatically handing over all data to the US with an American investor," she said, emphasizing that agreements could ensure that data is stored domestically.

"We need to stop thinking in black and white, because it's a bit more complex than that," she added.