The tariffs imposed by the Trump administration are set to significantly alter the landscape of international trade and transport. Analysis from Drewry reveals that the previous tariffs against China during Trump’s first term froze the volume of container shipments from China to the US, resulting in no net increase over six years. In contrast, countries like Vietnam, which were not subject to tariffs, experienced a remarkable 45% increase in trade volume during the same period.
Recent studies indicate a clear correlation between tariff increases and trade decline. The Haberkorn et al. study from 2024 shows that a 1% increase in US tariffs corresponds with a 1% decrease in trade volume a year later, underscoring the sensitivity of trade to tariff changes.
With the Trump 2.0 tariffs taking effect, the impact is expected to be uneven across trading partners. The newly announced tariffs, effective April 2, impose high rates on both China (a total of 54%) and Vietnam (46%), while Asian countries like the Philippines (17%), Malaysia (24%), and South Korea (25%) face relatively lower tariffs. This backdrop may prompt factories to relocate to favored Southeast Asian nations, enhancing their role in global supply chains, especially in sectors such as electronics and automotive manufacturing.
As retaliation is likely from China and the European Union, trade between these regions and the US could suffer significantly. The radical nature of these tariffs will create challenges for many economies and businesses. However, it may also lead to gains for others, transforming trade flows.
Carriers will need to reassess their strategies in response to these new realities. The expected shifts in trade volumes and potential downturns could impact freight rates, carrier services, and port coverage. Ultimately, stakeholders in shipping, forwarding, and logistics must prepare for disruptions and navigate the complexities posed by heightened trade barriers.