"In the course of the global competition over market share and market dominance, industrial espionage is becoming increasingly important," a new government report on terrorism, political extremism and intelligence found. This industrial espionage hurts the German economy in the process and endangers jobs, the report said.

"Despite strengthened political and economic ties, the Russian leadership continues to be active in Germany through intelligence means," the report said.

As many as one in two German firms has become a target of industrial espionage, Hartwig Moeller, head of North Rhine-Westphalia's intelligence agency, told the Financial Times Germany newspaper.

"Every second German company has been affected, studies show," Moeller said, adding that the loss of information costs German companies up to $78 billion a year.

Heinz Fromm, head of the Federal Office for the Protection of the Constitution, the government agency that compiled the 291-page report, said Thursday at the document's publication that the German government will increase its efforts to fend off foreign spies who are trying to acquire business secrets in Germany. Berlin will advise companies how to best protect themselves from industrial espionage, Fromm said.

The report says Russian spies are the ones who are most active in Germany. It also mentions intelligence activities by China, as well as countries in the Middle East and North Africa. "Intelligence and security services are ordered to actively support the Russian industry," the report found, adding that Vladimir Putin, Russia's prime minister and former president, supports the work of the intelligence services, citing comments made by Putin at an event of the SVR, Russia's civilian foreign intelligence service.

While industrialized nations spy for economic strategies, developing countries have set their eyes on information on "concrete products and research results," the report said.

Russian spies, disguised as journalists or diplomats, tried to acquire information on Germany's efforts to diversify its energy imports. Over the past several years they collected information on renewable energy, automobile and military technology, telecommunications products, as well as satellite and pipeline technology, the report said.

Besides full-time spies, Moscow also is using students, teachers and interns to acquire information, with computer espionage becoming increasingly important:

Currently, the "most dangerous threat" stems from Internet-launched spy attacks on computers in government agencies and company offices.

The report cited evidence that these attacks have a "state background" because of the quality of the technology and the level of financial and human resources used.

In 2007 German authorities uncovered a Russian spy operation that intended to unearth military helicopter technology secrets. Three people were arrested -- a Russian spy and his German and Austrian informants. The spy had to be released shortly, after Moscow protested with the United Nations that the man had diplomatic immunity.

While the Russians were given a warning for their spy activities, the biggest threat to Germany's interior security remains Islamist terrorism, according to Interior Minister Wolfgang Schaeuble.

"To Islamist terrorists, Germany is more than a place of retreat," Schaeuble said Thursday. "Our country has become an operating field of Islamist terrorists."

Only because of coordinated efforts by German and international authorities have terror attacks been prevented, he added.

The report also mentioned the high incidence of politically motivated extremism from the Far Left and the Far Right, with the number of neo-Nazis in Germany growing by 200 to 4,400.

By organizing social events and even extra tuition for schoolchildren, right-wing extremists are trying to "nest in the middle of society," Schaeuble said, adding that Germany had to make sure that this plan fails.

As recently as last week, Schaeuble banned private organizations comprised mainly of senior citizens who are denying the Holocaust and were trying to spread Nazi ideology.

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