Global trade stays strong despite US tariffs: DHL

Globalisation is proving far tougher than politics. Despite the steepest rise in U.S. tariffs since the 1930s, global trade is expanding, and business investment abroad remains steady. Global trade is projected to grow 2.5% annually through 2029, matching the past decade’s pace. The first half of 2025 saw the fastest trade expansion in over a decade, as China offset U.S. losses with gains in ASEAN, Africa, and Europe. Even amid record conflicts, the world economy shows no split into rival blocs, and trade is travelling farther than ever.

Tariffs may slow globalisation, but they can’t stop it, reports the DHL and New York University’s Stern School of Business special update to the DHL Global Connectedness Tracker. The update offers the first systematic assessment of how international trade and business investment are reacting to shifting U.S. trade policy under President Trump’s second term, according to a release from DHL.

The Tracker is a concise report and interactive website that provides regular updates on globalisation and global trade. It complements the DHL Global Connectedness Report, published regularly since 2011. "This edition draws on over 20 million data points from more than 25 sources to provide a comprehensive overview of the changing landscape of globalisation and global trade," it reads.

Global trade on track to match growth rate of previous decade through 2029
Global trade is projected to keep growing. The Tracker’s composite forecast projects a 2.5% annualised growth rate in global trade volumes from 2025 to 2029 – roughly matching the pace of the previous decade. One reason why trade can continue growing even as the U.S. raises tariffs is that only 13% of global goods imports went to the U.S. in 2024 and 9% of exports came from the U.S. Another is that most countries have not followed the U.S. in implementing broad tariff increases.

“Despite all the headwinds, the DHL Global Connectedness Tracker highlights the enduring strength of global trade,” said John Pearson, CEO DHL Express. “Trade barriers do not serve the world’s best interests. But we must never underestimate the creativity of buyers and sellers around the world who want to do business with each other. At DHL, we’re ready to help our customers seize the countless trade opportunities that continue to emerge across international markets.”

Tariffs are slowing, not stopping trade growth
While U.S. tariffs are predicted to slow global trade growth, they are not expected to stop it. Before the current wave of tariff increases (in January 2025), global goods trade volume was forecast to grow at a 3.1% annualised rate over the 2025 to 2029 period – since downgraded to 2.5%. North America experienced the steepest downgrade, with projections falling from 2.7% in January 2025 to just 1.5% by September. Most other regions experienced smaller downward revisions.

In contrast, forecasts were upgraded for South & Central America and the Caribbean, as well as the Middle East & North Africa. Most countries in these regions face relatively small U.S. tariff increases, and Middle East trade is expected to benefit from increased oil production and exports.

Global trade defies tariff turbulence in first half of 2025
The DHL Global Connectedness Tracker also reveals that, in the first half of 2025, international trade grew faster than in any half-year since 2010, excluding the pandemic rebound. U.S. imports surged early in 2025 as buyers rushed to frontload purchases ahead of tariff hikes. China fully offset declining exports to the U.S. with increased shipments to the ASEAN (Association of Southeast Asian Nations) region, while also substantially growing its exports to Africa, the EU, and other markets. Even after the frontloading wave in the U.S. subsided, global trade volumes remained above prior-year levels.

Business decision makers continue betting on foreign markets
Data on international corporate investment during the first half of 2025 were mixed, but they underscore the general resilience of global business. There was no pattern of companies redirecting investment from foreign to domestic markets. The cross-border share of M&A deals, for example, remained largely unchanged. However, uncertainty did appear to deter some cross-border investment, especially smaller transactions and new investments during the second quarter of 2025.

“Trade and international business investment trends so far in 2025 do not support the view that globalisation has gone into reverse,” said Prof. Steven A. Altman, Director of the DHL Initiative on Globalisation at NYU Stern’s Center for the Future of Management. “While it would be a mistake to disregard current policy threats to globalisation, companies are not generally pulling back from international markets, trade is crossing the longest average distance on record, and geopolitical conflicts have reshaped only a small fraction of the world’s international activity. The latest data show companies managing the risks and opportunities of a connected world rather than retreating to within countries or regions.”

No major split between geopolitical blocs
Despite 2024 marking the highest number of active global conflicts since World War II, the DHL Global Connectedness Tracker shows no major split of the world economy between rival geopolitical blocs. While direct U.S.–China ties continue to weaken and Russia is largely disconnected from Western-aligned economies, the world as a whole has not substantially reoriented its business ties along geopolitical lines – at least not yet.

Trade is not becoming more regional
Moreover, contrary to popular belief, the DHL Global Connectedness Tracker indicates that trade is not becoming more regional. In fact, the average distance that traded goods traveled rose to a new record of about 5,000 kilometres during the first half of 2025. The share of trade within major world regions fell to a record low of 51%. Greenfield foreign direct investment also became less regional, while international M&A activity remained at a stable level of regionalisation.

Globalisation holds at record high levels
The report also measures the wider phenomenon of globalisation based on trade, capital, information, and people flows. It uses a scale running from 0% (no flows across national borders) to 100% (borders and distance have no impact). Currently, the global level stands at 25% – nearly unchanged since its record high in 2022.