Why are euro-zone companies not using the very low interest rates and their very high profitability to invest more?

Despite very low long-term interest rates and very high profitability, the euro zone’s corporate investment rate is not very high. How can this be explained ? The sharp rise in the risk premium associated with investment in corporate capital; The industrial crisis, industry being the most capital-intensive sector; Banks’ difficulties; The uncertainty over growth in the short term and low potential growth ; The return to regional value chains, given the weak growth in domestic demand in the euro zone; The weakening of global trade, which is mainly linked to China’s change of growth model; The fact that a large share of the euro zone’s savings is invested in the rest of the world. Some of these explanations are related: the decline in potential growth weakens investment because of the regionalisation of value chains and diverts savings from being used to finance investment in the euro zone; the industrial crisis is linked to the weakening of global and Chinese growth. All this leads to a frustrating situation in the euro zone, where the environment might appear to be very conducive to corporate investment and yet is not generating much of it.