00:00Around 80% of global trade moves by sea.
00:06The container ship is its defining symbol.
00:09Introduced just 70 years ago, it revolutionized how goods are transported.
00:15Today, that system faces headwinds.
00:18U.S. President Trump has imposed high import tariffs on most countries worldwide.
00:24So what does that mean for global trade?
00:31It is also the invisible connector between producers and consumers of every single part of what we make use of in our everyday lives.
00:44The largest container ships can carry more than 24,000 containers, but they weren't always part of global commerce.
00:52American shipping magnate Malcolm McLean introduced them in 1956.
00:57Before that, goods had to be loaded piece by piece as general cargo, a slow, labor-intensive process.
01:08Containers enabled just-in-time production.
01:12Industrialized nations rely on pre-produced parts from abroad to keep factories running.
01:19But this model of international trade is now being tested by new U.S. tariffs.
01:28Import tariffs of 25 to 50% now apply to Indian goods entering the U.S., affecting roughly half of all Indian imports.
01:38Importers from the European Union face a 15% tariff.
01:42I think the consequences for overall container trade in the global economy are quite severe.
01:48Because there's no doubt this will impact volumes, whichever way you look at it.
01:52The lowest tariff for exports to the U.S. is 10% now.
01:57So it will have some dampening effect across the board.
02:01The World Trade Organization has revised its global trade growth forecast for 2025 from 2.7% down to just 0.9%.
02:13This downward revision reflects the combined impact of newly introduced tariffs and heightened uncertainty affecting trade relations with the United States.
02:24The U.S. administration says the tariffs aim to boost domestic growth and industrial production by curbing foreign imports.
02:32The U.S. currently runs a significant trade deficit, importing far more than it exports.
02:41In 2024, the U.S. trade deficit with China reached 295 billion U.S. dollars.
02:48With Mexico, it was over 171 billion, followed by Vietnam, Ireland, Germany, Taiwan and India, which had a deficit of 45.7 billion U.S. dollars.
03:00But will the president's strategy work? Will it actually create more jobs in the U.S.?
03:08The costs of these imports tariffs will be loaded upon the consumers, plus, of course, those who process the goods, especially the metal industry,
03:19of course, of course, with a higher tariffs coming from steel and aluminum.
03:24And that will be to the detriment of the U.S. industry, but not to its benefit.
03:30So what do fewer import opportunities mean for G20 nations and for the broader global economy?
03:37Can they find new markets among themselves?
03:40For example, with India, with ASEAN, we have good options basically also with Australia, with Mercosur, which is nearly done.
03:51And this could actually compensate about 25 percent of the losses with the U.S. trade.
03:58One path forward could be free trade agreements like Mercosur, which simplify duty free exchange among Latin American countries and potentially in the future with the EU.
04:09And there are more options.
04:11There are still also barriers within the single market in the EU.
04:16And so all EU countries could benefit from lowering these informal barriers basically.
04:21And that means like if we increase about 1.1 percent of intra-EU trade, we can basically compensate for the losses with the U.S.
04:31In the meantime, countries will need to work together to keep global trade flowing more freely.
04:37Only then will they be able to start to offset shrinking volumes with the U.S.
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