The biggest winners and losers of the tariff war as AI-related trade skyrockets

A truck runs by containers at the Uiwang ICD Terminal in Uiwang, South Korea, 12 March 2026
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Copyright 
AP Photo/Ahn Young-joon
Copyright AP Photo/Ahn Young-joon
Published on 26/03/2026 - 9:30 GMT+1•Updated
10:54
A report published this month by the McKinsey Global Institute offers one of the most rigorous accountings of last year's trade war
Its verdict confounds almost every prediction made when the tariffs were first introduced.

It is almost a year since Liberation Day, when US President Donald Trump stood in the Rose Garden and declared "reciprocal tariffs" against more than 50 countries.

Looking back, the tariff war did not kill global trade
That is the counterintuitive conclusion of McKinsey Global Institute's "Geopolitics and the Geometry of Global Trade" report, published this month.

Against US tariff rates at their highest since the Second World War, global trade grew faster than the world economy
Both US imports and Chinese exports reached all-time highs
President Trump speaks during Liberation Day at the White House to announce new tariffs, 2 April 2025
AP Photo/Mark Schiefelbein
As for the US, the figures present the starkest gap between political promise and statistical reality
In his Liberation Day speech, US President Donald Trump stated that "chronic trade deficits are no longer merely an economic problem
They’re a national emergency that threatens our security and our very way of life
For these reasons, starting tomorrow, the United States will implement reciprocal tariffs on other nations."
However, the Bureau of Economic Analysis confirmed a full-year goods and services deficit of $901.5bn (€779bn) last year, a negligible 0.2% reduction from $903.5bn (€780.5bn) in 2024
The deficit with China narrowed to $202.1bn (€174.6bn), its smallest in over two decades, but the US Department of Commerce's own data shows the gap migrated, primarily to Vietnam and Taiwan, where bilateral deficits widened to records
Where the US genuinely prevailed was in artificial intelligence
The US provided approximately half of the world's new data-centre capacity in 2025, and predominantly drove AI-related goods demand
AI-related trade skyrockets
Global trade received a significant boost from artificial intelligence in 2025, with AI-related shipments emerging as the single largest driver of growth.

McKinsey found that AI-related goods exports accounted for roughly a third of overall trade growth, with semiconductors and data-centre equipment expanding to make up more than 35% of global trade
Hardware essentials for building and operating AI systems, including chips, servers and networking gear, saw a boost in demand as major tech firms spend on building out AI infrastructure at an unprecedented pace and scale.

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Asian manufacturing hubs, notably Taiwan, South Korea and parts of Southeast Asia, supplied these goods to markets worldwide, with particularly strong flows to the US
Much of this AI-driven commerce took place between geopolitically aligned economies, illustrating how the technology has begun to redraw global flows amid tariff disruptions elsewhere.

The report underscores that booming investment in AI has left a lasting imprint on trade patterns, sustaining momentum at a time when traditional routes between major powers were contracting
"Every year, trade is shaped by both long-term waves and short-term splashes," said Devesa, adding that "the AI boom is a long-term wave that will continue to redefine trade for years to come, while the tariffs were last year's disruptive splash."
The EU's 'double squeeze'
Of all the major blocs, the European Union offers the most instructive cautionary tale
According to the report, the bloc is facing a “double squeeze”
On one hand, the EU’s trade deficit with China has widened, as imports have risen and exports have fallen
On the other hand, its trade surplus with the United States narrowed over the course of last year.

Moreover, as exports decline and imports rise in trade with China, the bloc also faces a race with the world’s second-largest economy for key markets that are predominant destinations for EU exports, according to Devesa
“There is also increased competition in that regard,” he said.

The automotive sector bore the sharpest impact
EU car exports to the US fell 17% while shipments to China dropped over 30% in 2025.

Simultaneously, Chinese electric vehicles flooded Europe, rising by about 50% to more than 800,000 vehicles
Germany, Europe's automotive heartland, imported more cars from China than it exported there for the first time in its industrial history.

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Overall, if stripped of temporary pharmaceutical frontloading purchases, the EU's manufacturing trade surplus shrank by approximately $40bn (€34.5bn), according to McKinsey.

Brussels has clearly felt the pressure of this double squeeze and is attempting to rewrite this vulnerability.

In January, the European Commission signed two landmark pacts, one with India, cutting, for instance, car tariffs from as high as 110% to 10% over five years, and one with Mercosur, also slashing barriers on autos and pharmaceuticals, among other products.

On Tuesday, the EU announced a new free trade agreement with Australia during a visit by the European Commission President, Ursula von der Leyen
The deal liberalises flows of goods while keeping quotas on sensitive EU farm products.

These agreements represent an explicit attempt to diversify EU trade away from Washington and Beijing, which together account for roughly a third of the bloc's external commerce
Tiago Devesa told Euronews that "the magnitude of trade with Mercosur and India's markets today is limited
However, they are very fast-growing markets, and they are complementary to the EU’s products and services
These are long-term insurance policies, not immediate remedies.

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