PIIE this week released a new working paper arguing that US import sourcing shifted rapidly away from China for tariff-exempt electronics such as smartphones and laptops, as multinationals quickly pivoted to India and Vietnam, but reorientation was slower for non-exempt goods like clothing and footwear.
The working paper states that much of the observed shift in US import sourcing toward Taiwan and Mexico was driven by demand for data centre inputs for artificial intelligence rather than deliberate supply chain decoupling from China.
Quote from the working paper:
US imports of smartphones, laptops, and monitors did not decline sharply in 2025 despite US tariffs hitting Chinese production for the first time, as multinational firms quickly sourced from India and Vietnam, where tariffs were exempted for these products.
Read the full working paper: How did Trump’s 2025 trade war affect decoupling US-China supply chains?