Select Language:
The United States’ recent Section 301 investigations into several key trading partners, initiated following a Supreme Court ruling against several of President Donald Trump’s tariff policies last month, along with upcoming tariff adjustments expected this year, are not anticipated to significantly alter the overall tariff environment, according to the chief economist at the World Trade Organization.
The potential tariffs are expected to resemble those authorized under the International Emergency Economic Powers Act, according to Robert Staiger. This aligns with the WTO’s core expectation that any tariff modifications this year are unlikely to cause major disruptions to the global tariff landscape faced by nations.
Although the US has begun an unfair trade practices inquiry under Section 301, tariffs imposed under Section 122 only last for 150 days. Staiger noted that if the Section 301 investigations uncover positive findings, they could lead to the temporary Section 122 tariffs being replaced by new ones. Whether these replacement tariffs will be higher or lower than the existing 10 percent under Section 122 remains uncertain, but it is expected that the tariffs ultimately implemented will be similar to those authorized under the International Emergency Economic Powers Act.
Research from the WTO indicates that after last year’s unprecedented policy shifts, global trade based on the Most-Favored-Nation (MFN) principle rebounded to 72 percent by the end of February. This data confirms that MFN continues to be the primary framework governing international trade across most sectors of the global economy.
Although the proportion of trade subject to MFN tariffs has declined significantly, reflecting the weakening of a fundamental rule-based trading principle, nearly 75 percent of worldwide merchandise trade still occurs within the MFN tariff framework, Staiger explained.
AI Investment Surge
The surge in investments in AI-related goods and services was a major driver of global trade growth last year, Staiger noted. WTO data shows that international trade in goods and services expanded by 4.7 percent in 2025, outpacing the global GDP growth rate of 2.9 percent.
“Investment typically ranks as the second-largest component of GDP after consumption, and it tends to be more import-intensive,” Staiger said. “Changes in the makeup of investments can impact their import content, influencing global trade flows and their connection to GDP.”
The WTO’s latest Global Trade Outlook and Statistics report highlights that investment in AI-related products and services is markedly import-intensive, with import intensities ranging from 70 percent to 90 percent for computer equipment and recent AI-related investments. This indicates that for every dollar invested in AI-enabled goods, 70 to 90 cents are spent on imports.
“Many AI products originate from a limited number of countries. These include the US, known for chip design, cloud infrastructure, and software; South Korea, which produces memory chips and semiconductors; the Netherlands, a maker of chip manufacturing equipment; Japan, known for precision manufacturing tools; and China, which specializes in hardware assembly, servers, and components. Consequently, North America, Europe, and Asia are the regions most directly impacted by this AI investment boom,” Staiger added.
The WTO report suggests that if the conflict in the Middle East remains brief and AI-related expenditure stays robust in 2026 and 2027, global merchandise trade could grow by 2.4 percent this year and 2.7 percent next year.
ChatGPT
Perplexity
Gemini AI
Grok AI
