Markets

The Dangerous Vulnerability of German Industry

A recent survey conducted by the digital association Bitkom highlights a critical issue for German businesses: an overwhelming dependence on the United States for digital technology imports and services. This dependency has reached alarming levels, with the nation’s economic resilience facing significant risks in the absence of these imports.

The Impact of Trump’s Presidency on German Businesses

The potential return of Donald Trump to the U.S. presidency has stirred unease within the German corporate sector. According to the survey, conducted among more than 600 companies across various industries with 20 or more employees, half of the respondents anticipate having to adjust their supply chains if Trump is re-elected. Furthermore, 56% expect to overhaul their business strategies in response to anticipated changes in U.S. policies.

Nearly 95% of the surveyed companies believe that Germany must strive for greater independence from the U.S. “Donald Trump’s renewed presidency presents a challenge for Germany and Europe,” stated Bitkom President Ralf Wintergerst. “While the U.S. will remain one of our key partners, we must urgently enhance our resilience and seize opportunities to become more technologically and economically self-reliant.” Wintergerst called on Germany’s new government to place economic interests at the forefront of its agenda and prioritize digital sovereignty.

Dependence on U.S. and Chinese Technologies

The reliance on U.S. digital technologies is striking. Eight out of ten businesses acknowledge their dependence on imports from the U.S., with nearly 90% sourcing digital devices and services from there. In contrast, only 60% of these companies export digital goods and services to the U.S., illustrating a significant trade imbalance.

However, the U.S. is not the only point of concern. German businesses also identify a heavy reliance on China for digital technology imports, with 80% acknowledging this dependence. Observers suggest that Trump’s protectionist policies and his likely efforts to further isolate China could create additional challenges for German companies operating in or with China.

Calls for Change Amid Escalating Vulnerability

Despite longstanding calls for reduced reliance on foreign technologies, including repeated appeals by Bitkom, little progress has been made. On the contrary, the level of dependency has worsened. Currently, only 3% of German companies believe they could sustain operations for more than two years without digital imports—a sharp decline from 7% in the previous year. Alarmingly, one in six businesses estimates they would survive no more than six months without these essential imports.

This situation underscores an urgent need for action. German policymakers and industry leaders must collaborate to reduce technological reliance on external powers and secure the nation’s economic future in an increasingly uncertain global landscape.