AI imports swell U.S. trade gap

The United States’ 2025 trade gap would have been nearly $200 billion smaller without the surge in artificial-intelligence imports, according to a new National Bureau of Economic Research paper. (nber.org) The paper, posted last week by economists Michael E. Waugh and Daria Taglioni, tracks “AI-related products” such as servers, graphics processors, memory chips, data-center networking gear, and cooling equipment that feed the buildout of AI systems. (nber.org) The researchers found those imports rose fast enough to reshape the balance of trade in 2025, even as Washington kept talking about tariffs and industrial policy. They wrote that trade policy treated many of those products “lightly” through product-level exemptions. (nber.org) That matters because the United States still runs a large goods deficit even after years of tariff fights with China and new subsidies for domestic chipmaking. The Bureau of Economic Analysis said the U.S. goods and services deficit totaled $918.4 billion in 2025, with the December monthly deficit at $70.3 billion. (bea.gov) The same paper found about 69% of U.S. AI-related imports appeared on at least one tariff-exemption list, a sign that the hardware behind the AI boom kept entering the country under carve-outs. Fortune reported that pattern on April 22 as President Donald Trump continued to argue for a hard line on trade. (nber.org) (fortune.com) The country mix helps explain why. Waugh and Taglioni found Mexico and Taiwan together accounted for about half of all U.S. trade in AI-related products, making them central hubs in the supply chain for servers and semiconductors. (nber.org) That reflects how AI hardware is made. Advanced chips may be designed in the United States, fabricated in Taiwan, assembled into servers in Mexico or elsewhere, and then shipped back into American data centers as imports. (nber.org) The paper does not argue that AI imports are economically harmful on their own. It shows the United States is buying foreign-made equipment at a pace that outstrips what it sells abroad in the same category. (nber.org) That leaves Washington in a familiar position: pushing domestic manufacturing through measures like the CHIPS Act while still relying on foreign-made hardware to build the computing backbone for AI. (bea.gov) (nber.org) For now, the numbers suggest the AI buildout is not just changing tech companies’ capital spending. It is also changing the composition of U.S. trade, one server rack and chip shipment at a time. (nber.org)