German agreed to invest a thousand, with skill to make capital (7)
I believe the answer is:
jakarta
'capital' is the definition.
(capital of Indonesia)
'german agreed to invest a thousand with skill' is the wordplay.
'german agreed' becomes 'ja' ('yes' in German).
'to invest' is an insertion indicator.
'thousand' becomes 'k' (synonyms).
'with' means one lot of letters goes inside another.
'skill' becomes 'art' (both can mean a talent).
'a'+'k'='ak'
'ja' placed around 'ak' is 'jaka'.
'jaka' enclosing 'art' is 'JAKARTA'.
'to make' acts as a link.
(Other definitions for jakarta that I've seen before include "Eastern capital" , "Indonesian capital" , "Capital of Indonesia, also spelled with initial D" , "Indonesian city" .)