INTERNATIONAL JOURNAL OF ARTIFICIAL INTELLIGENCE
ISSN: 2692-5206, Impact Factor: 12,23
American Academic publishers, volume 05, issue 06,2025
Journal:
https://www.academicpublishers.org/journals/index.php/ijai
page 2003
THE IMPACT OF TRADE TARIFFS ON THE GLOBAL MARKET
Giyozov Mahmud Valijon ogli
Head of the Jizzakh Regional Branch of the Ministry of Digital Technologies
(Uzbekistan, Jizzakh)
Abstract:
This article provides a comprehensive analysis of the impact of trade tariffs on
international economic relations and national economies. It explores how the proper application
of tariffs can stimulate domestic production, create new jobs, and increase government revenues.
At the same time, it examines the negative consequences tariffs can bring, such as rising prices
of imported goods, disruptions in supply chains, and a slowdown in global trade. The study uses
real-world examples from countries such as the United States, China, and India to illustrate how
tariff policies influence economic growth. The author emphasizes the importance of balanced
tariff regulation, strengthening international trade agreements, and ensuring trade stability
through institutions like the World Trade Organization.
Keywords
: trade tariffs, international economy, domestic production, supply chain, global trade,
economic policy.
Introduction
In the global economy, trade tariffs are one of the key instruments of economic policy used by
countries. Through tariffs, nations aim to balance foreign trade relations, protect domestic
producers, and ensure sustainable national economic development. In today's context of
globalization, deeply integrated supply chains, and increasingly active international trade
regimes, tariff policy has gained even more relevance.
Proper implementation of tariffs can lead to positive outcomes such as stimulating local
production, creating new jobs, increasing state budget revenues, and promoting the localization
of imported products. For example, the tariffs imposed by the U.S. on steel and aluminum from
2018 to 2022 spurred the revival of domestic industry and boosted economic activity.
However, excessive increases in tariffs may intensify tensions in international trade relations,
raise prices and inflation levels, disrupt supply chains, and slow down overall economic growth.
For instance, trade disputes between the U.S. and China led to a 1% decrease in global GDP,
disruptions in electronics and automotive industries, and heightened global inflation.
This article analyzes the impact of trade tariffs across various sectors, their positive and
negative consequences, and presents case studies of global and national economies. It also
considers opportunities to ensure stable and inclusive economic growth through prudent tariff
policy.
The Role of Trade Tariffs in Regulating International Trade Relations
Tariffs serve as an important tool for balancing international trade relations, ensuring a state's
economic independence, and protecting local production.
Properly applied tariffs can lead to:
Stimulation of domestic production;
Creation of additional employment;
Increased trade and service volumes, which raise state revenues;
Greater localization of imported products;
Adaptation of foreign manufacturers to local needs.
INTERNATIONAL JOURNAL OF ARTIFICIAL INTELLIGENCE
ISSN: 2692-5206, Impact Factor: 12,23
American Academic publishers, volume 05, issue 06,2025
Journal:
https://www.academicpublishers.org/journals/index.php/ijai
page 2004
Example
:
From 2018–2022, the U.S. imposed a 25% tariff on steel and a 10% tariff on aluminum. As a
result:
Steel production rose from 81 million tons in 2017 to 85 million tons in 2021;
12,000–15,000 new jobs were created;
The government generated $7–10 billion annually in revenue;
The market share of domestically produced vehicles increased from 64% to 67%.
However, tariffs can also have
negative effects
, including:
Higher prices for imported goods;
Increased international trade tensions;
Rising food prices;
Disruptions in logistics and supply chains;
Reduced consumer choice.
Examples of Negative Global Impacts
2018–2019
: U.S.-China tariffs on $300 billion worth of goods reduced global GDP by
1% (World Bank).
2019–2022
: Chip prices rose by 15–20%, slowing production in electronics and
automotive sectors, increasing costs, and reducing purchasing power.
India
: Tariffs of 30–40% on smartphone imports limited market entry for global brands,
reducing consumer choice.
In
2025
, similar issues resurfaced due to:
Unpredictable tariff policies under President Trump;
Retaliatory measures from other countries.
Global Impacts in 2025
:
Global trade growth:
1.8%
, down by
1.6 percentage points
from 2024 (average growth
in 2000s was 5.9%);
Global GDP growth forecast for 2027:
2.5%
— the lowest since the 1960s;
World Bank forecast for global inflation in 2025:
2.9%
, higher than pre-pandemic
levels;
A further 10 percentage point increase in U.S. tariffs could reduce global GDP growth
by
0.5%
.
"This slows global trade, creates uncertainty, and causes instability in financial markets."
Example: U.S. Trade Tariffs Introduced in 2025 under President Trump
Tariff Type
Affected Countries
Rate
Universal tariff
All countries
10%
High tariffs
Countries with large trade deficits
with US
10–60% (or higher)
Energy & minerals not produced
in the US
—
No tariffs
Automobiles & parts
All countries (under Section 232) Varies
INTERNATIONAL JOURNAL OF ARTIFICIAL INTELLIGENCE
ISSN: 2692-5206, Impact Factor: 12,23
American Academic publishers, volume 05, issue 06,2025
Journal:
https://www.academicpublishers.org/journals/index.php/ijai
page 2005
Tariff Type
Affected Countries
Rate
USMCA countries
Canada, Mexico
0–25% (0% for aligned
goods)
If USMCA is abolished
Canada, Mexico
12% on all goods
Such measures force countries to revise growth forecasts and domestic policies:
Revised 2025 Growth Forecasts
:
USA
: 1.4% (down 0.9 percentage points), 2026: 1.6% (down 0.4 points);
EU
: 0.7% (down 0.3 points);
Japan
: 0.7% (down 0.5 points);
Mexico
: 0.2% (down 1.3 points);
China
: Maintained at 4.5% for 2025.
Other impacts
:
Economically vulnerable countries: growth at 3.8% (down from 4.1%);
Recovery in poor countries may take
2–10 years
;
By 2027, per capita GDP in these countries will be
6% lower
than pre-pandemic levels.
Sector-Specific Effects of Tariffs
Sector
Impact of Tariffs
Automotive
Encourages local production, but disrupts international supply chains
Electronics
Price increases reduce competition among local and international brands
Food
&
Agriculture
Supports local farmers, but raises import prices
Metallurgy
Stimulates domestic output, but raises costs in automotive and construction
sectors
Conclusion
Trade tariffs hold a dual role in the global economy:
On one hand, they
stimulate local production
, protect jobs, and increase government
revenues.
On the other hand, they cause
international trade turbulence
,
price inflation
, and
disruptions in supply chains
.
Therefore, the
optimal path
for economic development includes:
Prudent and balanced tariff policy
;
Deepening international agreements
;
Supporting stable trade through WTO and bilateral agreements
.
REFERENCES:
INTERNATIONAL JOURNAL OF ARTIFICIAL INTELLIGENCE
ISSN: 2692-5206, Impact Factor: 12,23
American Academic publishers, volume 05, issue 06,2025
Journal:
https://www.academicpublishers.org/journals/index.php/ijai
page 2006
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