It’s not just about tariffs. Something deeper is shifting

The global trade model that dominated the post-Cold War era is being quietly but fundamentally rewritten.

For decades, the US offered its allies two core advantages – often without asking much in return:

1. a military security umbrella,

2. preferential access to the world’s largest consumer market.

These weren’t just political favors – they were massive economic inputs.

If you try to quantify them, the picture becomes clear:

• For the EU alone, the value of these two advantages over 25 years is estimated at $5 trillion – around 20% of annual EU GDP.

• Add the time factor and capital multiplier, and the figure may exceed $10 trillion.

But these drivers – defense savings, zero-barrier trade, cheap energy, EU enlargement, infrastructure mega-projects – are no longer what they used to be.

The global cost structure has changed. So has geopolitics.

What we’re seeing now is a gradual but deliberate monetization of privilege – the US is starting to charge for what used to be free.

The numbers speak for themselves:

• US tariffs, once averaging 3 – 4%, have now reached 15 – 20%.

• In April 2025, they hit 20%, levels not seen since the Smoot-Hawley Act of 1930.

• That law helped trigger a 40% collapse in global trade within two years.

We are in a different world today – more complex, more interdependent. But the historical echo is hard to ignore.

Meanwhile, the US federal budget deficit stands at 7.2% of GDP, and the annual trade deficit is close to $1 trillion.

Tariffs are no longer about ideology – they are about balance sheets.

Other economies are moving too.

• India: average tariffs now at 17%.

• Brazil: debating reindustrialization through trade barriers.

• ASEAN, Africa: using tariffs to protect supply chains.

This is not a temporary glitch. It’s a recalibration of global openness.

Ukraine fits into this picture.

• In 2024, Ukraine’s trade deficit with the EU hit €18 billion, or 12% of GDP.

• That’s not sustainable.

• We can’t close this gap through exports alone.

We’ll need a mix of:

• smarter industrial policy,

• deeper processing,

• selective protection,

• strategic reserves.

Takeaway?

This isn’t about protectionism vs. free trade.

It’s about rethinking strategic leverage.

The world is changing – slowly, then suddenly.

And for countries like Ukraine, this may be the last window to build structural competitiveness before the new global terms are set.