Issue #2 II quarter 2025
Issue Highlights
The determining factors in the development of most sectors of the global economy in April-June 2025 were the trade war initiated by the United States, the suspension of increased tariffs for most countries by D. Trump in early April, and the achievement of a “trade truce” between the United States and China in May. The resulting high uncertainty in the future and its impact on the global economy had the greatest impact on high-tech sectors with advanced global supply chains (semiconductors, equipment and electronics, the automotive industry) — accelerated purchases, restructuring of production processes, and even more intensive provision of technological sovereignty by China began to occur. D. Trump's policy, announced as a tool for the national industrial development, is bearing fruit — manufacturers of steel products, semiconductors, and electronics began to announce investments in the United States, while the automotive giants are reacting more reservedly for now.
The activities of the world's largest companies in Q1 2025, despite geopolitical tensions and the unfolding of a trade war initiated by the United States, generally showed positive dynamics. The Global Performance Index (GPI) was 68%, demonstrating that more than 2/3 of companies increased their revenue compared to the same period of the previous year. One of the main growth drivers was accelerated purchases in a number of industries made by companies in anticipation of the introduction of import duties announced by the United States. The gap between the results of companies from developed and developing countries is quite high — the GPI was 61% and 76%, respectively. A similar picture was observed in Q1 2024, however, during the year the gap almost leveled out.
Investors' views on the near-term prospects for global business development are pessimistic — the value of the world's largest corporations fell by an average of 4% in Q2 2025 compared to Q1 2025. The main drop in quotes occurred at the beginning of April, when Washington announced the introduction of high tariffs, including up to 145% on goods from China, which in turn announced retaliatory measures. Despite the fact that D. Trump subsequently postponed the introduction of increased tariffs for most countries for 90 days, and in May agreed on a "tariff truce" with China, the value of shares of many companies did not recover after a sharp drop or recovered insignificantly due to the high level of uncertainty in future US policy and its impact on the global economy.
Oil and gas
In the global oil and gas sector, severe sanctions pressure on Iran and Russia continues. Despite this, Iranian oil supplies to China and Russian supplies to India are at record levels. An important factor determining market and price dynamics has become OPEC+ decisions on accelerated restoration of oil production. The industry was affected during the quarter by the US-China “trade truce”, the Iran-Israel conflict, and US-Iran nuclear deal negotiations.
Iron and steel
The global steel industry remains the epicenter of the trade war — the suspension of increased tariffs announced by D. Trump in early April did not affect the industry's products, and in early June, US duties on steel increased from 25% to 50%. US policy is bearing fruit — leading manufacturers are making large-scale investments in the American steel industry. US restrictions and record growth in steel exports from China have triggered a sharp increase and global nature of protectionism in the industry.
Food sector
In the food sector, the transition to natural ingredients is transforming into a new industry standard. This will require a restructuring of supply chains, which is causing concern among manufacturers due to the instability of the quality of natural analogues, potential increase in cost price and a small number of suppliers of natural ingredients. Major manufacturers continue to expand internationally and locally, and are also restructuring to focus on key business areas.
Pharmaceutical industry
Geopolitical tensions and the trade war still do not stop pharmaceutical companies from developed countries in their quest to conquer the Chinese market — European and American manufacturers are intensively cooperating with Chinese partners. The industry is experiencing increased competition in the segment of drugs for obesity and diabetes. A new trend is the transition of pharmaceutical manufacturers to contract manufacturing, which has led to the expansion of capacities and consolidation among leading companies for contract development and manufacturing.
Automotive industry
In the automotive industry, manufacturers are transforming supply chains, provoked by D. Trump's trade policy. A high-profile event of the quarter was Tesla losing its leading position in the electric car segment in Europe; its main competitor, the Chinese giant BYD, is increasing sales at a high rate, while Tesla's revenue is falling. Chinese automakers continue their overseas expansion, their sales on the domestic market are provided by a new discount war, and technological development is supported by the integration of the IT sector.
Semiconductor industry
The global semiconductor industry continues to expand capacity in countries around the world, most intensively in the United States. The technological war does not stop China on its path to sovereignty in semiconductor production. According to analysts, by 2030, China will have 30% of the world's production capacity. However, despite a number of significant technological achievements, China's ability to produce advanced chips by that time is still in question.
Consumer electronics
Consumer electronics manufacturers have accelerated the process of transferring product assembly to the United States and India, which at the present stage is becoming the largest beneficiary of the duties introduced by D. Trump. In some segments of the industry, there is a change of leaders, which is explained by high competition, weak demand and the intensive development of Asian manufacturers.
IT equipment
The key drivers of the industrial IT equipment industry continue to be the AI boom and the expanded construction of data centers. China is focusing its efforts on developing its own production of equipment for the production of chips and has demonstrated a number of achievements in this direction. Manufacturers are vigorously promoting quantum technologies from the research stage to the market entry stage.
Platform business
The platform business is increasingly seeing a trend towards the development of unmanned technologies, primarily in the robotaxi sector. Companies are deepening their presence in related industries and expanding their industrial and geographical reach through acquisitions and strategic partnerships. New antitrust charges emerged during the quarter, mostly against American platform giants.
Software
In the software industry, the contradictions between the US and the European Union are intensifying — states are arguing over AI regulation, corporations are competing in cloud services. Europe is trying to close the gap with the US and China in the field of training AI models and building gigafactories, having published the “AI Continent Action Plan”. The development of AI models is making the issue of copyright protection increasingly acute — a number of lawsuits were filed during the quarter on claims by owners of text and video content.
Telecommunications
Telecom operators continue to intensively integrate into satellite communications projects, the global competition in the development of which is intensifying. Companies continue to develop AI technologies and implement AI solutions, providing additional sources of income, and also develop security tools due to the increasing frequency of cyber attacks. Consolidation processes in the industry are intensifying and are taking place in almost all regions of the world.
Transport and logistics
The global transport and logistics sector is experiencing the impact of the trade war — spot rates for container shipping are rising, imports to the US are falling, cargo turnover at Chinese ports continues to grow (now in the direction of Europe and the Middle East), and cargo turnover in civil aviation is increasing. The industry continues to expand its fleet, port infrastructure is being intensively developed. US pressure on China is particularly acute in the shipbuilding industry.