Growing Demand for Digital Sovereignty in Germany
3 min read
German companies are increasingly reliant on the import of digital technologies and services from the Far East and America, but are now advocating for greater digital sovereignty. This is because developments in the USA under Donald Trump are causing concern.
The German economy is watching the second presidency of Donald Trump in the USA with trepidation. It’s not just the announced import tariffs that could have a negative impact on businesses and their operations here. Trouble also looms in the digital sphere. According to Bitkom, the German economy is 81 percent dependent on the import of digital technologies and services from the USA.
While there are already initial initiatives and countermeasures to reduce this dependency, nine out of ten German companies are additionally calling for an increase in Germany’s and the German economy’s digital competitiveness, according to Bitkom. The question remains, however, how quickly these measures will take effect in an emergency and whether it would even be possible to replace leading US providers with German or European ones.
US Imports Still Indispensable
41 percent of German companies surveyed by Bitkom consider themselves heavily dependent on US imports. 87 percent import digital devices and services from the United States, while 60 percent also export digital goods and services across the Atlantic. Roughly half of the companies feel compelled to adjust their business strategies or alter their supply chains due to Trump’s election victory.
95 percent of the more than 600 respondents from companies with over 20 employees, spanning various industries, demand that Germany reduce its dependence on the USA. German companies view China with similar criticism: 79 percent consider themselves reliant on digital imports from the Middle Kingdom.
Bitkom President Dr. Ralf Wintergerst sees Trump’s return to the White House as a “challenge for Germany and Europe” and states: “Although the USA will remain one of our most important partners, we must now position ourselves more strongly, more resiliently, and more opportunistically. We need to become technologically and economically more independent. The new federal government must prioritize the economy in its policies and make digital sovereignty a top issue.”
Digital imports are vital for survival
He further emphasizes: “A country is digitally sovereign if it possesses its own substantial capabilities in key digital technologies and can independently decide from which countries to source digital technologies. The German economy needs strong, trustworthy partners for digital transformation. At the same time, we must become more digitally independent to avoid being blackmailed.”
As his industry association writes, without digital imports, half of all companies would not survive a year. 17 percent estimate they could only last six months, 36 percent for just seven to 12 months, and 39 percent for 13 to 24 months. Only 3 percent of the surveyed companies could endure longer without digital imports.
96 percent of businesses depend on them. At the top of the list of imports are end devices like smartphones and notebooks, which are imported 90 percent of the time. In second place are software applications at 75 percent, followed closely in third by cybersecurity products at 72 percent. Digital components such as hardware, chips, and other semiconductor products come from abroad 69 percent of the time, digital devices and machinery for production, analysis, and services come two-thirds (66 percent) from abroad, and digital services including app programming and IT consulting come 50 percent from abroad.
“87 percent import digital devices and services from the United States, while 60 percent also export digital goods and services across the pond.”
Most trust in other EU countries
The majority of imports come from the USA and China, each with over 40 percent “strong dependence.” Together, the USA and other parts of the EU account for 87 percent of imports of digital technologies and services. China ranks third with 78 percent, while Taiwan, despite many of its factories being in China, lags far behind at 41 percent. Japan is in the mix with 36 percent, the United Kingdom (UK) with 34 percent, and India now at 20 percent.
Problematic are imports from crisis and war zones such as Ukraine or Israel, which in individual cases account for 12 or 9 percent in German companies.
Germany’s digital exports go to other EU countries 92 percent of the time, to the USA 60 percent of the time, to Japan 55 percent of the time, and to India and the UK each 48 percent of the time. Taiwan receives 42 percent.
Other EU countries enjoy the highest level of trust in Germany as importers, with 97 percent. Japan follows with 73 percent. By contrast, only just under half of respondents trust the USA, and trust in China is even lower at 44 percent.
