The impact of President Trump’s trade tariffs continues to be felt in the global economy and international trade routes.
According to the IMF’s World Economic Outlook published in July, developments in world trade continue to shape the outlook for the global economy. Despite the U.S. decision to partially roll back the very high tariffs announced in April and the easing of trade tensions with China, “tariffs are still historically high and global policy remains highly uncertain, with only a handful of countries having reached fully developed trade agreements.”
Better than expected?
However, the IMF notes that the global economy has remained resilient and that the trade shock may not be as severe as initially feared. Still, the impact remains significant and evidence is accumulating that the global economy is being damaged. Projected growth of 3% this year is disappointingly below the pre-COVID average, while only 2.8% growth is forecast for next year. Moreover, the IMF expects world trade as a share of the global economy to decline structurally: from 57% in 2024 to 53% in 2030.
Shifts are also evident in air cargo. According to Air Cargo Week, prolonged trade tensions between the U.S. and China are casting a heavy shadow over regional air cargo volumes. E-commerce shipments to the U.S. are particularly affected by the additional tariffs. At the same time, new growth opportunities are emerging: trade routes between Asia and Europe are expanding, and Southeast Asia is rapidly developing into a major logistics and manufacturing center.
Restoration of trade between China and the U.S.
Although e-commerce shipments by air freight to the U.S. are under pressure, ocean freight appears to be recovering strongly. After declining sharply in May and June, U.S. container import volumes rose 18.2% in July over June to over 2.6 million TEUs. Imports from China even increased by 44.4% to the highest 2025 level since January. Volumes from Thailand and Vietnam also rose sharply. China remains the main supplier, but other Asian countries are strengthening their position through diversification and changing tariff policies.
Strong demand for shipping
Demand for shipping services remains strong, especially on the route between Europe and Asia. Rolf Habben Jansen, CEO of Hapag Lloyd, confirmed in August that global container volumes have broken monthly records for the second time this year. This comes as Asian exporters shift their volumes from the U.S. to Europe, where freight rates are rising. Maersk also raised its earnings forecast, predicting global container flows will grow 2-4% by 2025.
The Baltic Dry Index, a key indicator of bulk freight demand and economic activity, reached its highest level of the year in August. This indicates continued strong demand for freight services.
China focuses on the south
According to research by S&P Global, U.S. tariffs are accelerating China’s trade and investment strategy toward emerging economies. While Chinese exports to the US and Western Europe grew 28% and 58% respectively over the past decade, exports to Southeast Asia, Latin America and the Middle East doubled. This may lead to a new trade order in which South-South trade becomes central and Chinese multinationals become the dominant players.
The US-EU trade agreement
The recent framework agreement between the US and the EU is an important test case. The US introduced a 15% tariff on all EU goods – half of the previously threatened 30% – while the EU opens its markets to US exports at zero percent tariffs on certain goods.
According to think tank CEPS, this agreement will lead to a 0.2% to 0.8% drop in EU GDP, with countries such as Germany, Italy and Ireland, and sectors such as automobiles, engineering and agriculture, hit hardest.
Continuing uncertainty
CEPS warns that the agreement provides only temporary relief and offers no guarantees for the long term. After all, Trump has been known to revise or even withdraw agreements, as was evident in previous trade agreements. Implementation of new deals has also been difficult. For example, the US-UK deal announced in May would remove the US import duty on British steel, but this has still not been implemented. British steelmakers are losing contracts and jobs are at risk.
Similar frustrations also occur in Japan, the EU and South Korea, which recently reached agreements with the US. Meanwhile, a US tax of 25% on cars from Japan and Germany, among others, remains in place, officially under the guise of national security.
