$5 Billion in German Investments in the US Over Six Months
The United States has maintained its status as an attractive market for German companies, with firms already operating there continuing to reinvest locally generated profits, despite the uncertainty surrounding decisions on new capital investments amid shifts in U.S. trade policies.
According to calculations by the German Economic Institute, based on data from the German Federal Bank, German direct investments in the United States amounted to 4.3 billion euros, equivalent to $5 billion, during the first half of 2026. Although this figure represents a decline of approximately two-thirds year-on-year and about 80% compared to the same period in 2024, detailed data on the composition of investment flows indicate that existing German companies in the U.S. market are continuing to channel their profits into their local investments.
Samina Sultan, a researcher at the German Economic Institute, stated that companies already operating in the United States are continuing to reinvest their earnings in the country, suggesting that the U.S. remains generally an attractive market, while firms are adopting a more cautious approach toward new capital injections. These moves by German companies come at a time when trade relations between the United States and its international partners are undergoing changes linked to the trade policy of U.S. President Donald Trump’s administration and tariffs, prompting companies to reassess their new investment decisions.
Last year, the European Union approved an agreement as part of its efforts to avoid high tariffs on its exports to the U.S. market, which included a commitment to invest $600 billion. Historical data show that the average investment by German companies in the United States during the first half of the year was 15.8 billion euros in the five years preceding the COVID-19 pandemic. Sultan noted that the period from 2020 to 2023 was significantly affected by the exceptional circumstances accompanying the pandemic, with some years witnessing net outward investment flows.
