Successfully investing in the USA

last updated on 3 July 2025 | reading time approx. 4 minutes

How do you assess the current economic situation in the USA? »
How would you describe the investment climate in the USA? Which sectors offer the largest potential? »
What challenges does a German entrepreneur face when engaging in the USA? »
How do assess the options for a german company wanting to invest in the USA? »
How do you see a developing in the future? »

How do you assess the current economic situation in the USA?

In 2025, the U.S. economy has demonstrated unexpected resilience, maintaining stability despite ongoing political tensions and deepening social polarization across the nation.

Following a 2.7 percent expansion in 2024, the economy experienced a slight slowdown in the first quarter of 2025. Nevertheless, overall momentum remains strong, with annual growth projected to reach approximately 2.4 percent. Forecasts from the Federal Reserve and other institutions suggest a potential moderate deceleration later in the year.

A key indicator of this resilience is the continued robustness of the labor market. Employment has surpassed pre-pandemic levels, with around 163 million Americans currently employed — an increase of 1.5 million from 2023 and 2.4 million from 2024 — highlighting consistent job growth amid broader economic uncertainties.

Inflation has also eased significantly. After peaking at 9.1 percent in 2022, it declined to an average of 3.2 percent in 2024, thanks to the Federal Reserve’s steady interest rate policy. A further reduction to approximately 2.8 percent is anticipated for 2025.

In summary, the U.S. economy remains solid and resilient, though a gradual cooling trend may emerge as the year progresses.

How would you describe the investment climate in the USA? Which sectors offer the largest potential?

he investment landscape in the United States in 2025 presents a nuanced blend of opportunities and challenges. On one side, favorable conditions — such as robust domestic demand, a thriving innovation ecosystem, and substantial government subsidy programs—continue to draw investor interest. On the other, the growing unpredictability of trade policy under the current U.S. administration complicates long-term planning, particularly for international investors.

Despite these uncertainties, the U.S. remains a highly attractive economic environment. Legislative measures like the Inflation Reduction Act, the Clean Energy Program, and the CHIPS and Science Act are actively bolstering emerging industries, stimulating domestic production, and reinforcing the U.S.’s role as a global leader in technology and industrial innovation. However, efforts are currently being made by the current government to reduce or abolish certain subsidies. These developments should be followed closely.

At the same time, increasingly protectionist trade policies—such as short-term tariffs and “Buy American” mandates—are contributing to a climate of uncertainty that can dampen foreign investment appetite. As a result, investment decisions are becoming more dependent on a company’s strategic risk tolerance and adaptability.

Nevertheless, the overall investment climate remains positive, especially for firms with a long-term perspective, a strong local presence, and solid financial foundations. The combination of government incentives, strong local demand, and the scale of the U.S. market continues to offer compelling opportunities—particularly for companies willing to invest in local production and value chains while remaining agile in response to evolving regulatory conditions.

Current support programs highlight significant potential in sectors such as renewable energy and environmental technologies, information technology (including AI and software development), as well as traditional industries like automotive, healthcare, pharmaceuticals, and biotechnology. These sectors offer promising prospects for innovative German companies, especially those with an established U.S. footprint.

Enterprises can also benefit from attractive short- to medium-term opportunities, provided they are strategically positioned. With their technological expertise, long-term orientation, and high adaptability, German firms are well-equipped to establish a strong presence in the U.S. market. Over the long term, sustained economic growth in the U.S. will increasingly hinge on the localization of production and value creation within its borders.

What challenges does a German entrepreneur face when engaging in the USA?

The United States continues to offer a business-friendly environment, with corporate tax rates that are in general comparable to those in Germany, but generally accompanied by fewer regulatory hurdles. Recent policy measures aimed at bolstering domestic value creation—ranging from trade and tariff barriers to targeted economic stimulus and transformation programs—create both opportunities and challenges for companies entering the U.S. market.

However, cultural differences can pose unexpected obstacles. Communication styles, consumer behavior, and market expectations vary significantly across states and regions. Additionally, many German companies enter the U.S. with limited brand recognition, making it essential to establish a strong presence on social media and digital platforms, while also cultivating networks with suppliers, customers, industry associations, and government agencies. Compounding these challenges is the difficulty of recruiting qualified personnel.

Another critical consideration is the complexity of the U.S. legal and tax system, which operates at federal, state, and local levels. This necessitates thorough planning and expert guidance before market entry. Moreover, the U.S. market is highly dynamic, with conditions that can shift rapidly. Success requires companies to remain agile and responsive to change.

By addressing these factors early in the planning process and preparing thoroughly for market entry, German companies can significantly enhance their chances of success and mitigate potential risks.

How do assess the options for a german company wanting to invest in the USA?

As of 2025, direct investment in the U.S. remains a strategically viable option—albeit under significantly altered conditions. President Trump’s second term has ushered in a more protectionist economic agenda, characterized by abrupt tariff implementations, “Buy American” mandates, and increased regulatory interventions. A return to more liberal trade policies does not appear imminent. Instead, the emphasis continues to be on strengthening domestic markets and promoting local value creation.

In this environment, establishing a physical presence in the U.S.—whether through a subsidiary, joint venture, or local production facility—has become increasingly essential. Such a presence not only facilitates market access and mitigates exposure to trade policy risks, but also demonstrates long-term commitment. Moreover, it is often a prerequisite for participating in government support programs and enhancing competitiveness in public procurement.

U.S. customers are also showing a growing preference for local partnerships. Being on the ground helps build stronger client relationships, improves access to skilled labor, and enables quicker adaptation to regulatory changes.

At the same time, U.S. tax authorities at both federal and state levels are intensifying efforts to identify and tax non-resident companies with economic activity in the country. This includes scrutinizing operations for the presence of taxable permanent establishments or services subject to sales and use tax. These risks are particularly relevant for companies without a physical footprint — such as those offering assembly services, digital platforms, or remote solutions. As such, early and strategic tax planning is critical to avoid unexpected liabilities and ensure compliance.

How do you see a developing in the future?

The year 2025 represents a pivotal shift in U.S. economic policy. The federal government is actively pursuing a targeted industrial strategy focused on reshoring value chains and reinforcing protectionist measures. Policies such as the abrupt introduction of tariffs, “Buy American” incentives, and interventions in global supply chains are increasingly shaping the economic landscape. While these developments introduce a degree of uncertainty, they also open up new opportunities — particularly for companies that proactively establish a strong presence in the U.S. market.

Despite ongoing political polarization and unpredictable shifts in trade policy, the U.S. economy continues to demonstrate strong underlying momentum. Domestic demand remains solid, employment levels are high, and strategic sectors such as energy, semiconductors, defense, and digital technologies are benefiting from substantial public investment through initiatives like the Inflation Reduction Act and the CHIPS and Science Act.

From a European perspective, the medium-term outlook for the U.S. remains favorable — especially for companies prepared to adapt to the evolving regulatory and economic environment. A local footprint, operational agility, and long-term strategic planning are increasingly critical to success. While future elections may alter the political landscape, the current trajectory reflects a fundamental repositioning of the U.S. economy — one that is likely to persist and continue evolving dynamically.