The Trump Effect: How U.S. Politics Shook Global Supply Chains
Amid strained American political relations, one may be tempted to question the global effects of the Trump administration, particularly its impact on international trade. What happens when a hegemon turns its back on the very source of its success that is international interdependence ? While they were once a pillar of the 1947 GATT, the United States has, in recent years, grown increasingly fond of protectionism. This ideology, which promotes economic isolation in the name of national growth has at times proven effective in history. Yet in Trump’s case, protectionism appears to drift toward mercantilism, an economic approach in which a nation actively regulates trade to strengthen its own power, to the detriment of others.
As the United States retreats from its international networks, a crucial question emerges: how will global supply chains be restructured?
To answer this, it is essential to examine the core of Trump’s “America First” agenda, which clearly targets the rise of its main rival, China. While the U.S. has undergone deindustrialization since the 1960s, China has followed the opposite trend, establishing itself as the world’s leading supplier of manufactured goods in the 21st century. As a result, it now sits at the heart of many global supply chains. Ultimately, they became the primary target of Trump’s aggressive trade measures, including tariffs that reached up to 245% in April 2025. While this proactive action aimed to weaken Chinese competitiveness and their position on the international industrial stage, it has also forced American companies to reconsider long-established sourcing strategies. Industries that found these measures too harmful simply passed the costs onto their customers, effectively transferring the burden to the end participants in global value chains.
But where will the supply chains move if importing from China becomes too expensive? Countries neighbouring the Celestial Empire, such as Vietnam, as well as U.S. neighbours like Mexico, quickly emerged as attractive alternatives due to their relatively low production costs. The technology sector, particularly the semiconductor industry, proved especially sensitive to these shifts. Yet Trump’s objective is not to strengthen foreign manufacturing hubs, since Mexico, for example, was also targeted by these protectionist measures. Instead, his policy sought to stimulate domestic production. Indeed, the administration imposed tariffs on as many as 185 countries, with the clear goal of pushing firms to relocate production to U.S. territory.
To illustrate this, one can look at the Swiss pharmaceutical sector, heavily export-oriented, where the top 5 companies today rely on the US for half of their sales. Faced with the option to avoid tariffs by producing domestically, Swiss firms responded accordingly, by investing in their American factories. One of Switzerland’s largest pharmaceutical companies, for instance, announced a 23 billion dollar investment plan to the American market.
This case encapsulates the current global dynamic. While countries publicly express resistance through retaliatory measures, behind closed doors they negotiate, sometimes even appealing directly to Washington D.C.. Despite widespread criticism of U.S. trade policies, one reality remains unchanged: the United States continues to be the most powerful actor on the international stage.
