The Global Trade Pulse: Impact on Investments

In a rapidly evolving marketplace, businesses are navigating a complex web of trade policies, tariff pressures, and shifting supply chains.

This article explores how these dynamics affect investment strategies and offers actionable insights for resilient growth.

Survey Insights and Economic Outlook

The HSBC Global Trade Pulse Survey (Second Edition, October 2025) polled 6,750 business leaders across 17 countries, revealing that global trade confidence is rising compared to six months ago.

Respondents span firms with turnovers from USD 50 million to over USD 2 billion, offering a comprehensive view of corporate sentiment.

Meanwhile, UNCTAD’s Trade and Development Report 2025 indicates global trade grew by 4% in early 2025, with goods up 5% and services up 6% in Q2.

Tariffs and Trade Policy Effects

Tariffs have become the primary cost driver, with 54% of firms reporting higher expenses due to tariffs and customs duties have added to their cost base over the past six months.

Baseline duties of 10% or more are now common on many imports, amplifying price pressures.

Regional impact: 59% of Southeast Asian businesses face tariff-driven cost hikes
In MENAT, 46% report increased expenses from duties
48% see tariffs affecting revenues, with pricing changes at 47%

As governments deploy new levies, companies must refine pricing and sourcing strategies to preserve margins.

Sectoral Performance: Goods vs. Services

Trade growth diverges significantly between goods and services.

In 2024, services trade reached USD 8.7 trillion—up 9%—while goods grew by only 2%.

Services firms also demonstrate greater resilience to shocks and uncertainty.

This table underscores the need for goods-oriented firms to diversify into agile service offerings and embrace digital channels.

Regional Strategies and Supply Chain Shifts

Geographic reorientation is a core response to trade disruption.

Thirty-four percent of businesses have already expanded into more stable regions, and half plan to do so.

Europe: 40% increasing reliance for resilience
Southeast Asia: 36% eyeing expansion
North America: 32% strengthening regional ties

Notably, 22% plan to reduce reliance on North America, while 92% of North American firms remain confident about growing international trade.

Working Capital and Liquidity Pressures

Despite easing monetary policies, companies report increased working capital needs in 2025.

Sixty-two percent of respondents cite higher funding demands, driven by inventory build-ups and tariff mitigation.

India leads with 77% reporting elevated working capital needs, followed by the USA at 73%.

These funding pressures highlight the importance of liquidity management and proactive cash flow forecasting.

Investment Behavior and Future Outlook

Sixty percent of businesses are deferring international investments, echoing April’s 62% figure, yet 77% have adopted a more flexible investment strategy to manage ongoing risks.

Seventy-five percent are planning or executing supply chain transformations, such as relocating assembly or processing activities to mitigate tariff exposure.

Nearshoring and diversification into Eastern Europe, Mexico, and Southeast Asia are gaining traction.

Strategic transformation efforts are still unfolding, suggesting that the full impact of policy shifts will continue to shape global operations.