Doha: Qatar National Bank (QNB) projected that global trade would continue to grow above its long-term average of 4 percent, spurred by a new cycle of investment in artificial intelligence worldwide.
According to Qatar News Agency, QNB's weekly commentary highlighted a notable contradiction in the global economy in 2025. Global trade volumes expanded by approximately 16 percent, significantly exceeding the 4 percent long-term average and surpassing the global GDP growth of 3 percent. Simultaneously, the US implemented aggressive tariff increases, culminating in the "Liberation Day" measures announced in April.
At first glance, these developments seem contradictory, as conventional trade theory suggests that higher tariffs, especially by a major importer like the US, should hinder global trade. However, the reality was more complex. QNB's previous commentaries argued that global economic integration was unlikely to reverse despite the US tariff shock. Data reinforced this view, showing that global trade accelerated through 2025, challenging assumptions about the interaction of tariffs with modern supply chains and macro-financial dynamics.
The resilience of trade can be attributed to several factors. First, the threat of tariffs triggered a front-loading cycle, particularly in the US. Before the full implementation of the tariff regime, US importers expedited shipments to secure lower duty rates. This behavior was evident in customs data, inventory buildup, and port activity. US goods imports surged in late 2024 and early 2025, especially in tariff-exposed categories, reflecting precautionary stockpiling rather than consumption.
Similar patterns occurred during the 2018-19 US-China trade war, with tariff announcements leading to short-term spikes in trade flows. In 2025, the scale was larger and more geographically diverse as firms hedged against higher tariffs, uncertainty around exemptions, and future policy changes. This defensive behavior temporarily boosted global trade volumes, masking the long-term effects of tariffs.
Second, effective tariff burdens were lower than headline rates due to exemptions, delays, and corporate adaptation. While statutory US tariff rates rose to around 14.8 percent, effectively charged tariff revenues indicated a burden closer to 11 percent. Product-level exemptions, phased schedules, bilateral carve-outs, and waivers diluted the immediate impact on trade costs. Multinational firms adapted by reconfiguring sourcing, rerouting shipments, and managing internal pricing, reducing the pass-through of tariffs to final prices and volumes.
Third, the acceleration of AI investment provided a strong impulse to trade. The expansion of data centers, semiconductor fabrication, and supporting infrastructure led to increased cross-border flows of capital goods and high-value components. AI-related investment, which is import-intensive and globally fragmented, drove trade volumes, reinforcing exports from technologically advanced manufacturing hubs despite protectionist measures.
Lastly, supportive macro-financial conditions, such as a nearly 10 percent USD depreciation in 2025, offset trade policy headwinds. The depreciation improved competitiveness for exporting economies, particularly those with currencies anchored by the USD. This currency dynamic enhanced exporters' pricing power in global markets.
The 2025 experience highlights that strong global trade growth alongside higher US tariffs was driven by front-loading, lower effective tariffs, AI-related investment, and USD depreciation, rather than a revival of protectionism. While trade growth may slow as front-loading effects fade and the USD stabilizes, continued AI investment should sustain trade growth above the long-term average.