Since former President Donald Trump introduced his first round of new tariffs, global markets have been anxiously waiting to see their full impact on international trade. Now, early signs of that impact are starting to show—and the results aren’t encouraging. One of the clearest indicators came this week when South Korea’s Customs Service reported a 5.2% drop in exports during the first 20 days of April compared to the same period last year. According to Min Joo Kang, a senior economist at ING, this specific data point serves as a “key bellwether” for where global trade is headed.
This decline appears closely tied to Trump’s decision to impose a 25% tariff on imported steel, aluminum, and automobiles. In addition, all other South Korean imports were briefly subject to a 25% “reciprocal” tariff, though that measure has been postponed until July. For now, South Korean products face a nearly universal 10% tariff when entering the U.S. market. These policy shifts are already being reflected in the trade numbers. For example, South Korea’s car exports dropped by 6.5% and steel shipments fell by 8.7% during the first 20 days of April compared to the previous year. Even more concerning, overall exports from South Korea to the U.S. declined by a steep 14.3%.
The steep drop suggests that U.S. tariffs are beginning to influence buyer behavior. As prices rise due to these tariffs, American buyers may reduce demand for imported goods, particularly those now facing added costs. South Korean exporters, many of whom depend heavily on strong U.S. demand, are now experiencing the financial consequences. With fewer cars and steel products heading overseas, these companies may soon need to consider adjusting their production strategies, prices, or even target markets.
Despite the downturn in most sectors, there was one exception—semiconductors. Exports in this category actually rose by 10.2% compared to the same period last year. This growth offers a small ray of hope and highlights how exempted sectors can still thrive under restrictive trade policies. However, this positive trend may not last. President Trump has already signaled plans to impose tariffs as high as 25% on semiconductors as well. If such measures are enacted, the last stronghold of South Korea’s export growth could also come under pressure.
The bigger picture remains uncertain. South Korea is widely considered a reliable indicator of global trade trends due to its export-heavy economy. A decline in its shipments may reflect wider disruptions to international trade flows. As more countries respond to the U.S. tariffs—either with their own tariffs or shifts in policy—trade dynamics could become even more volatile. Meanwhile, companies around the world may need to re-evaluate their global supply chains, pricing models, and long-term business strategies in anticipation of continued trade restrictions.
In short, the data emerging from South Korea offers one of the first concrete examples of how U.S. tariffs are affecting the global economy. While it may be too early to draw long-term conclusions, the early indicators are troubling. If these trends continue, the effects of the tariffs could ripple far beyond steel and car manufacturers, impacting a wide range of industries and international trade relationships in the months ahead.
