The barometer of global trade appears to be experiencing a "heartbeat-like" fluctuation. Have you noticed how prices of imported goods around you rise and fall unpredictably? Behind this phenomenon lies a "buy-first-shrink-later" effect in global trade, triggered by U.S. tariff policies.

The latest Goods Trade Barometer from the World Trade Organization (WTO) has surged to 103.5 in the first quarter, marking the highest level since August 2021. This figure, significantly above the 102.8 recorded in March, seems to herald a new spring for global trade. Yet beneath this apparent prosperity lurk troubling risks.

The Illusion of Prosperity Under a "Buying Frenzy"

What force is driving this unexpected rise in global trade indicators? The answer: fear . With former U.S. President Donald Trump's tariff threats looming, businesses worldwide have rushed into a "stockpiling mode," placing large orders for imports to avoid impending additional costs. This "first-mover advantage" mentality has led to a surge in imports, temporarily masking the slowdown in export orders.

Data reveals that among all components of the WTO's trade indicator, only export orders show negative growth—a clear warning sign. While businesses are busy importing, their outlook on future exports remains pessimistic. However, booming air freight, container shipping, and rising demand for automobiles and electronics have obscured this troubling trend.

Who Benefits From This "Buying Frenzy"?

Unsurprisingly, air freight and maritime shipping industries have reaped the most rewards from this rush. Soaring cargo volumes have delivered substantial profits. Meanwhile, imports of high-value goods like automobiles and electronics have surged, indicating businesses are prioritizing stockpiling tariff-vulnerable products at any cost.

The "Buy-First-Shrink-Later" Trade Model: A Poisoned Chalice?

But can this model sustain long-term prosperity? The WTO warns that if stockpiling is indeed occurring, trade growth will likely slow later this year. The reason is simple: businesses will need time to digest accumulated inventories rather than continue heavy imports.

More concerning is the decline in export orders, which exposes the true state of global trade: despite current import strength, businesses lack confidence in future demand, and trade fundamentals remain weak. Once stockpiling ends, trade volumes could plummet sharply—even below normal levels—as excess inventories are gradually absorbed.

The Cost of Trade Wars: A Distorted Global Supply Chain

This "buy-first-shrink-later" pattern reflects businesses' reactive stance toward policy uncertainty and highlights how trade wars have disrupted normal supply chain operations. While short-term data may appear positive, the global economy will likely pay a long-term price.

Experts predict the tariff-driven buying frenzy will eventually fade. When businesses complete their stockpiling, trade volumes could face a cliff-like drop, posing even greater challenges to the global economy.

In the face of this tariff storm, businesses must act with cooler heads. While panic buying may offer short-term risk avoidance, it could backfire in the long run. Only through strategic adjustments and proactive measures can companies navigate this uncertain landscape successfully.