Economic World War: Donald Trump wanted to strengthen the USA – and then Germany entered the picture
Donald Trump's tariff policy is increasing uncertainty: German investments in the USA have plummeted to a three-year low, but companies already operating in the country continue to reinvest their profits.
German companies are significantly reducing their investments in the United States against the backdrop of uncertainty created by the trade policy of the Donald Trump administration. According to a report by Reuters, in the first half of 2026, direct investments by German companies in the USA totaled only 4.3 billion euros — a decrease of almost two-thirds compared to the same period in 2025, and the lowest level since 2023.
The sharp decline in investments
The data, based on figures from the Central Bank of Germany and analyzed by the German Economic Institute (IW), point to a significant downward trend. Compared to the first half of 2024, the volume of investments in the first half of 2026 is almost 80% lower. The IW notes that this is a continuation of a trend that began after Donald Trump's return to the White House in January 2025. The trade policy of the American administration, and in particular the threat of imposing tariffs on US trade partners, has contributed to increased uncertainty among German companies.
Since returning to office, Donald Trump has used the threat of tariffs as a tool to exert pressure on US trade partners and achieve concessions in favor of Washington. Against this backdrop, the European Union agreed last year to a deal that included a commitment to investments totaling 600 billion dollars, in an attempt to avoid heavy tariffs on European exports to the USA.
Almost four times the average
The gap between the current level of investment and the years preceding the pandemic illustrates the magnitude of the decline. In the five years preceding the coronavirus pandemic, the average investment by German companies in the USA in the first half of the year was 15.8 billion euros — almost four times the amount recorded in the first half of 2026.
However, the IW emphasizes that the data from the years that followed are also influenced by the extraordinary circumstances created during the coronavirus period. Between 2020 and 2023, abnormal capital movements were recorded, and in some years, there was even a net outflow of investments.
Existing companies continue to invest
Despite the decline in new investments, the data point to a more complex picture regarding German companies already active in the American market. An analysis of the composition of investment flows during 2025 showed that loans as part of direct investments and reinvested profits were particularly high. On the other hand, equity in the narrow sense — the balance between new investments and divestments — remained below average.
The IW explains that the meaning of the data is that the American market is still considered attractive for German companies already operating in it. These companies continue to reinvest in the USA the profits they generate in the country. Alongside this, there is hesitation regarding commitments for new capital. The picture that emerges from the data is one of companies that are not rushing to leave the American market, but at the same time are hesitant to make new and significant investments under the current conditions of uncertainty.
