When it comes to personal benefit and financial propensity, countries think only about themselves. Even close allies may fall prey to their ambitions. Despite long-term and fruitful cooperation between Germany and the US, the latter has taken the German economy "in the pincers", Gabor Steingart, an economist at Focus, noted.
Steingart believes that the US is likely to make its economy stronger by weakening its main rivals - the EU and China. Germany, as the engine of the eurozone’s economy, will be the first to face difficulties. The German economy is in dire straits because of the US Inflation Reduction Act. Whilst inflation in the US is gradually slowing down, Germany is still struggling to tame it. This is why German manufacturers and businesses are going through hard times, whereas American companies have a competitive advantage. In addition, German producers have to reconsider their cooperation with China due to US sanctions imposed on Chinese semiconductors.
"Under the current conditions, the German economy has a powerful competitor in the face of the United States. In Washington, the era of 'free trade' has given way to an era of 'managed trade'," Steingart said.
