Speaking after chairing a cabinet meeting in Chancellor Angela Merkel's absence, Westerwelle also said he was in favour of a "points system" to plug what experts say is a 60,000-strong gap in Germany's skills set.
"It is of course right that we intelligently invite citizens to work in our country who are positive for us and for our development," said Westerwelle, adding it was in Germany's "national interest."
Such a programme must run hand-in-hand with training home-grown talent and preventing well-qualified people from leaving the jobs market, he said.
"We have become an emigration land in recent years. Far too many talented people have left Germany. We need to make our country so attractive that people employ their talents here," said the minister, who is also vice-chancellor.
Germany's Economy Minister Rainer Brüderle kicked off what has become a passionate debate over immigrant workers when he suggested last week that firms should offer cash incentives to attract skilled workers from abroad.
Merkel dismissed the proposal and trade unions, opposition politicians and other members of the governing coalition in Berlin also expressed strong objections to the plan.
But with a plunging population and an increasing dearth of skilled employees, Germany is mulling ways to attract top brains to its shores. Consultancy firm McKinsey has estimated that the country will be short of two million skilled workers by 2020.
Germany introduced a "green card" system for qualified immigrant workers in 2000, which has enabled 33,000 people to come to Germany in those 10 years,
according to recent figures.
Despite this, Dieter Hundt, head of the German Employers Federation (BDA), wrote recently in Die Welt daily that the economy lacked more than 60,000 skilled workers and called for a points system to attract more.
Westerwelle said he had campaigned for such a points system while in opposition and found the scheme "as before positive."