Global trade is winning Trump’s war on it
The average effective tariff rate that the US has applied remains much lower than what the American president’s pronouncements would suggest
NEARLY six months after US President Donald Trump announced his ultra-high “reciprocal” tariffs – in blatant defiance of World Trade Organization (WTO) rules – the global trading system is holding up well. No other major economy has followed Trump’s example, and, according to United Nations Trade and Development, world trade has increased by about US$300 billion in the first half of 2025.
Most of the world seems to understand that Trump’s tariffs are economically irrational. Of course, in many cases, economics is not the point: Trump uses tariffs to advance geopolitical goals or to salve his personal grievances. Nowhere is this more apparent than in the 50 per cent tariff imposed on Brazil as punishment for prosecuting former president Jair Bolsonaro for inciting a Trump-inspired coup attempt in 2023, following his electoral loss.
But Trump has always held that tariffs are the key to improving the United States’ trade balance, which is why his “reciprocal” tariffs are purported to reflect the size of America’s deficit with each economy. Economists, by and large, dispute these claims, warning that tariffs will only reduce America’s overall trade volume, both exports and imports. And, so far, their admonitions have been borne out.
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