Trade distortion and protectionism

Breaking down US$450 billion of trade destruction from US tariffs

Visual Capitalist

20250613 VC The War On Global Trade Part 2 Trade Destruction 1200X675

Published 17 June 2025

Globalization and the rise of global trade have fueled economic growth worldwide. Now, that landscape is rapidly shifting under the Trump administration’s tariff policies. Visual Capitalist illustrates the dollar value of expected trade destruction by economy, using data from the new United Nations Trade Intelligence and Negotiation Adviser.

On 12 May, the Trump administration threatened a new wave of tariffs on much of the world. The impact on global trade could be massive in the years ahead.

This graphic, created in partnership with the Hinrich Foundation, shows the dollar value of expected trade destruction by economy. It uses data from the new United Nations Trade Intelligence and Negotiation Adviser (TINA).

Trump 2.0 tariffs

Since taking office in late January, President Trump has prioritized disrupting global trade to support domestic industries across America. While tariff details shift frequently, the message is clear: globalization is under threat.

So far, most countries face a 10% tariff. Key trading partners including China, Canada, and Mexico, and industries such as dairy and lumber, are being hit with even steeper penalties. 

Trade destruction: UN estimates

To measure the long-term impact of the tariffs, the United Nations estimated trade destruction — also known in econometric terms as "negative trade creation" — by economy.

Estimates are based on expected changes in import demand, factoring in tariff rates, initial import volumes, and supply and demand elasticities.

The total projected trade loss is a staggering US$450 billion. The biggest hits are expected in China (US$156.6 billion), the EU (US$92.6 billion), and Japan (US$27.7 billion). Canada and Mexico, targets of an earlier set of tariffs, were excluded by the UNESCAP from this dataset.

This hit to trade is also expected to have adverse impacts on the domestic economy. Trump 2.0 tariffs are estimated to lower US real GDP by 0.8% over the next decade.

The future of global trade 

Globalization and the rise of global trade have fueled economic growth worldwide. By enabling countries to specialize based on comparative advantage, trade made goods more affordable and widely available.

Now, that landscape is shifting. The Trump administration’s tariff policies signal a significant turn in global trade strategy, with far-reaching implications for how countries engage in commerce in the future.

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