Trump's trade war wreaked little havoc on trade patterns last year

President Donald Trump’s trade wars, including his near universal tariffs of 10 percent or higher, set off a scramble among US trade partners last year that some experts predicted would reshape the contours of worldwide trade. Many countries reportedly vowed to find alternative sources of imports and markets for exports, rather than relying on the United States.

Perhaps surprisingly, there has been very little reconfiguration of global trade, at least through October of 2025. Two-way trade with the United States as a share of total trade changed very little among 19 impacted foreign partners trading with the United States in 2025. To be sure, trade shares in 2026 could tell a different story. Moreover, US two-way trade with nearly all 19 partners grew significantly slower than world trade in 2025.

Following the “Liberation Day” (April 2, 2025) tariffs of 10 percent and considerably higher on imports from several countries, Trump’s trade team reached agreements and deals with at least 19 trade partners. The talks typically reduced Trump’s previously declared tariff on imports from the trade partner but not often below a rate of 15 percent.

Several factors seem to have been at play keeping the status quo in the overall shape of US participation in global trade. For example, Canada and Mexico continued to benefit from zero tariffs on most goods that are compliant with the United States-Mexico-Canada Agreement (USMCA), which took effect in Trump’s first term, although like other partners they faced new tariffs on select products subject to “national security” tariffs (e.g., steel, aluminum, lumber, and non-compliant autos and parts).

Other likely factors include the probability that firms in many countries, anticipating tariffs, pumped out US exports before the tariffs could take effect. The Trump administration also negotiated myriad exemptions after announcing its tariffs. And at least for most of last year, most trading partners did not retaliate against US imports, with the important exception of China. It is also true that trade relations are slow to change because they reflect deep relations between privately owned buyers and sellers.

Table 1 explores the impact of Trump’s tariffs on the merchandise trade patterns of 19 partners, reporting shares of their total two-way trade conducted with the United States in the full year 2024 and the partial year through October 2025. During 2025, Trump concluded full-fledged trade agreements or partial deals with these 19 partners, but none of the agreements or deals rolled tariffs back to their 2024 levels (typically around 3 percent). For some partners, Trump announced but did not implement future tariff rates. The overall picture is a jagged pattern of actual and announced US tariff rates, depending on the country of origin, as shown in table 1.

Table 1 does not report threatened and withdrawn Greenland tariffs on imports from the European Union, nor the 50 percent threatened tariffs on countries that purchase oil from Russia, nor the 100 percent tariff that Trump threatened against Canada if it concludes a trade agreement with China.

Among the 19 countries that negotiated tariffs with Trump in 2025, 9 reported changes in their US trade shares of less than 1 percent between 2024 and 2025. Another 6 countries reported an increase in their US trade share of more than 1 percent: Australia, India, Indonesia, Switzerland, Thailand, and Vietnam. Southeast Asian increases in two-way trade with the United States largely reflect a diversion of US imports from China to those countries. Only 4 countries reported a decrease in their US trade share of more than 1 percent, but these included the 3 largest US trading partners: Canada, China, and Mexico.

Expressed in dollar terms, data through October 2025 indicate that two-way merchandise trade with the United States increased for 16 of the 19 trade partners. The three exceptions are Canada, China, and Korea. Nevertheless, since the dollar value of world merchandise trade increased by 6.3 percent in 2025 compared to 2024, almost all of the 19 partners increased their two-way trade with the United States by significantly less than the increase in world trade.[1] In dollar terms, the total increase of two-way trade with the listed 19 partners sums to $161.8 billion, representing growth of 3.6 percent, much less than the 6.3 percent increase in world trade and also less than the 5.4 percent increase in total US two-way trade. Several of the 19 partners are subject to much higher “reciprocal” tariffs than the universal 10 percent rate announced by Trump.

Table 2 expands the two-way merchandise trade analysis by examining import shares (and dollar changes) and export shares (and dollar changes) from and to the United States separately. The “shares” represent the proportion of trade to either total imports or total exports respectively of the partner countries. For 11 of the 19 trade partners, the dollar value of their imports from the United States (meaning US exports) increased less than the dollar value of their exports to the United States (meaning US imports). Importantly, in this group were two large US trade partners, Mexico and the European Union. This would appear superficially to run counter to Trump’s goal of reducing foreign imports and expanding US exports.

For 8 of the trade partners in table 2, the dollar value of their imports (meaning US exports) increased more than the dollar value of their exports (meaning US imports). Several large US trading partners are in this group: China, Japan, Korea, the United Kingdom, and the European Union. In other words, for these countries, trade changes reflected Trump’s agenda: bigger increases in US exports than US imports.

However, the total increase in imports of US goods (US exports) adds up to $63.4 billion, while the total increase in exports of goods to the United States (US imports) is half again as large, at $98.4 billion.

As mentioned at the outset, the biggest takeaway from this dive into two-way partner trade with the United States is surprisingly little change in 2025, despite announced US tariffs of 15 percent and higher. While US two-way trade with the 19 partners increased by $161.8 billion, this represents growth of just 3.6 percent, much less than world trade growth of 6.3 percent.

The sharp drop in US two-way trade with China was simply not echoed in US two-way trade with other partners. Instead, much of this trade was diverted to other countries, particularly those in Southeast Asia.

To summarize the possible reasons for these outcomes, as referenced above, four factors seem to be at play:

• Anticipating Trump tariffs, firms in many countries surged their exports to the United States in the early months of 2025.
• Trump allowed exemptions to the negotiated or announced tariffs as affected US firms complained loudly about the adverse impact on their sales and employment. This partly explains the gap between statutory and actual tariff rates. In addition, Trump’s tariff declarations were subject to frequent pauses and new rates were often slow to be implemented.
• Because firms invest heavily in their trade relations they are slow to change. While oil is often bought and sold in anonymous markets, trade in most consumer, intermediate, and capital goods entails deep relations between buyers and sellers.
• Apart from China, no country retaliated strongly against US exports.

All four reasons for steady US trade shares and increased dollar volume of two-way trade may fade in 2026, especially if Trump implements another large round of tariffs, as he often threatens. If current US tariffs persist or increase, more countries seem likely to reduce their two-way commerce with the United States, especially in share terms.

Note

1. UN Trade and Development estimates the growth over the trailing four quarters (Q1-Q4 2025 compared with Q1-Q4 2024) at 6.3 percent for goods and 8.8 percent for services.