- UK optimism has sharply declined since US tariffs unveiled on 2 April; only 42% of firms now expect export growth, down from 85% beforehand
- 89% of UK firms renegotiating supplier/logistics contracts to manage costs; only 20% of firms plan to absorb higher costs while 38% intend to pass them on in their pricing
- Asia Pacific now the most popular region for both production site/supplier relocation and new export opportunities, surpassing North America
Allianz Trade’s exclusive new survey, which took the pulse at the peak of the US trade war (before and after “Liberation Day” on 2 April) reveals the toll of the trade war and the coping mechanisms for 4,500 exporters in nine key countries that account for close to 60% of global GDP.
The unpredictability of US tariff policies has increased uncertainty for global businesses, according to the findings of the 2025 Allianz Trade Global Survey released today. Covering 4,500 companies across China, France, Germany, Italy, Poland, Singapore, Spain, the UK and the US, and conducted in two rounds – before and after the “Liberation Day” tariff announcements on 2 April – the results reveal a stark shift in expectations for growth, perceptions of risks, especially with regards to payment delays, and diverse strategies to mitigate the effect of the trade war. Even with the advent of bilateral trade deals in recent weeks, the fog of uncertainty isn’t breaking. Some of the relief could prove temporary.
The Allianz Trade Global Survey reveals that close to 60% of firms expect a negative impact from the trade war, and 45% expect export turnover to decline. The impact goes beyond trade volumes: more than one in four firms are considering temporary production halts due to the combination of tariffs and currency volatility, particularly in sectors reliant on imported intermediate goods.
“In sharp contrast to the optimism seen before the April 2 tariff wave, this year’s Global Survey confirms what we’re observing across markets: uncertainty and fragmentation are becoming structural. “Liberation Day” exposed the vulnerabilities of companies with highly concentrated supply chains and export markets. The numbers speak for themselves: global positive export expectations dropped from 80% to 40%, and 42% of companies now expect export turnover to fall between -2% and -10%, compared to just 5% before the April 2 announcements. Despite recent bilateral agreements with the UK and China, we estimate global export losses will reach USD 305bn in 2025. Companies are not standing still. Having navigated successive shocks since 2020, they are once again adapting, diversifying partners, reconfiguring logistics, and embedding risk-sharing across the value chain. In today’s trade environment, success depends increasingly on adaptability,” says Aylin Somersan Coqui, CEO of Allianz Trade.
UK firms to pivot, reassess and press ahead
Like its global counterparts, optimism in the UK has sharply declined. Before “Liberation Day”, 85% of businesses expected export revenue to grow in 2025. Post-”Liberation Day”, that dropped to 42%. More than a third of firms (39%) now expect a decline in turnover of up to -10% this year. This is perhaps unsurprising, given the UK remains on the losing end of the bargain with the US, it’s largest export partner, even though the two nations reached a trade agreement on 8th May. The US trade-weighted tariff rate on UK imports will be lowered from 9.1% to 6.1%, but are still much higher than the 0.9% pre-Trump administration. We expect this will lead to export losses of USD4bn (GBP3bn).
However, according to our survey, UK businesses are among the most ready globally to deploy capital to curb the impact of increased tariff-related challenges. 60% of exporters are planning to diversify into new business lines and increase capital expenditure in strategic areas (up from 49% before “Liberation Day”), second only to China (77% today vs 58% before “Liberation Day”).
Maxime Darmet, Senior Economist for the UK, US and France at Allianz Trade, said: “As one of the few countries to have secured a trade deal with the US, the UK finds itself in a pretty unique position. While the reduction in the US-trade weighted tariff rate is a step forward, it applies to select sectors still leaves UK exporters at a disadvantage compared to pre-Trump administration levels. With businesses still facing a lot of uncertainty, they may understandably be less optimistic, but they’re ready to pivot and find new opportunities where necessary. This balancing act will be crucial in the coming months, as the UK seeks to maintain, manage and build essential trade relationships with the US, EU and, increasingly, Asia.”
Companies still on the backfoot, relying on coping mechanisms such as passing on higher costs, diversification and looking for alternative shipping routes
The temporary relief is likely to encourage companies to keep frontloading until the expiry of the 90-day pauses (12 August for China and 8 July for the rest of the world), as they did at the beginning of the year – 86% of US companies said they had frontloaded shipments from China and the EU before the tariffs kicked in.
Few companies intend to absorb increased costs or cut export prices to maintain market share, especially in the US where more than half of companies plan to raise prices (54%). Because of high uncertainty, sourcing from new markets is likely to continue, being the second most preferred option among ways to mitigate the impact of tariffs, especially in Poland and Spain.
In the UK, the vast majority (89%) of businesses are now renegotiating either supplier or logistics contracts to manage costs. However, only 20% of firms plan to absorb any increased supply chain costs. More commonly, 38% of firms plan to increase their own prices to offset higher costs, rising to 51% among manufacturing firms. Meanwhile, almost a third (32%) of all UK businesses plan to source from new markets (up from 25% before “Liberation Day”) so they don’t have to increase their prices; they’re increasingly considering Asia-Pacific and Western Europe as their preferred locations, moving away from North American production sites. UK firms may also be looking closer to home, with 87% of respondents expecting to switch at least some of their suppliers to domestic firms or partially re-shore their production.
Diversifying supply chains and customer bases is an enduring risk mitigation strategy – unsurprising, given that 54% of respondents consider geopolitical and political risks and social unrest among the top three threats to their supply chains. More than one third of businesses surveyed have already found new markets to export to, while almost two thirds were planning on doing so.
To keep costs related to customs under control, a majority of firms are seeking alternative shipping routes, including 62% of US companies (facilitated by shipping costs having dropped nearly -50% since early 2025 and lower oil prices - expected to range between 65 USD/bbl and 70 USD/bbl for the remainder of the year).
US-China decoupling, Europe-Asia rapprochement, and Latin America as the quiet winner of the trade war
The decoupling between the US and China is likely to continue in the medium term despite the 90-day pause in tariffs. US businesses’ intention to export to China and East Asia halved to 10% after “Liberation Day”, while Chinese firms’ expectations to export to North America collapsed from 15% to 3%. US companies with production in China are increasingly looking for alternatives outside Asia: one fourth of them are considering Western Europe and another fourth, Latin America.
In the UK, partial diversification away from the US is underway. 38% of firms have already found new export markets, while a further 56% plan to. Post-”Liberation Day”, the Asia Pacific has become the most attractive region for new export opportunities, with 41% of businesses saying China now the most attractive destination, followed by Australia in third place (7%). However, it appears the US will remain an important part of the mix, with 12% of businesses still ranking the US as the most attractive for new export opportunities.
“Even though the new trade deal brings the US average import tariff rate on China to 39%, down from an eye-watering 103%, this remains much higher than the 13% rate applied before the second Trump administration. Against this backdrop, friendshoring is likely to continue gaining traction: Europe and Latin America are emerging as attractive alternatives for Chinese firms, and European firms are also increasingly interested in exporting to China and Asia: between both surveys, export intentions increased to 36%, and the interest towards the South and Southeast Asian market doubled to 14%. Meanwhile, Latin America is emerging as the winner of rerouting and trade circumvention strategies, with both Chinese and European firms looking to the region for access to the US at a lower cost,” states Françoise Huang, Senior Economist for Asia Pacific and Trade at Allianz Trade.
Around half of exporters anticipate longer payment terms and increased non-payment risk
The trade war has hit expectations in payment terms: post-”Liberation Day”, 25% of exporters anticipate payment terms longer by more than 7 days, a surge of +13pps. Nearly half of exporters (48%) anticipate increased non-payment risk — particularly in the U.S., Italy, and the UK — reflecting the broader deterioration in global trade conditions.
Only 11% of export companies continue to be paid within 30 days, but this figure is notably lower among top exporters like the US, China, and Germany. Approximately 70% of companies receive payments between 30 and 70 days – this figure is slightly higher in the UK (75%), France (73%), Italy (73%), and the US (73%), and varies by sector and company size.
“Larger firms tend to experience longer payment delays, with 26% of surveyed companies having a turnover above EUR5bn facing payment terms exceeding 70 days, compared to 18% for the overall sample average. This suggests that major companies are increasingly taking on the role of an invisible bank for smaller companies. As exporters face longer payment cycles and rising insolvency risks, they’re under pressure to pass on costs, source from new markets, or even reconsider their entire international footprint,” ends Ana Boata, Head of Economic Research at Allianz Trade.