What Countries Are Primed to Be the Biggest Winners From Trump's Tariffs?

Overview of Trump’s Liberation Day Tariffs

On April 2, 2025, U.S. President Donald Trump announced his “Liberation Day Tariffs,” the colloquial name for Executive Order (EO) 14257, which outlined extensive new U.S. tariff policies. The main tariff effects of this EO were to:

• Institute a baseline 10% import duty on all goods entering into the United States.
• Introduce additional tariffs on a country-by-country basis. 

Exact tariff rates vary by country and are calculated using a formula that relates the amount the U.S. exports to a country and the amount that same country imports. Using this calculation, which essentially calculates the U.S. trade deficit with each country, a clear trend emerges: small and developing countries that are epicenters for manufacturing of goods consumed in the U.S. are given high tariffs, while countries that have limited manufacturing and/or limited trade with the U.S. have low tariffs.

Tariffs, Paused or Not, Still Pose a Threat

While these tariff increases on all countries—except China—are paused until July 9, 2025, they still threaten to upend the international trade system that the U.S. has relied upon for years to import cheap goods—for both manufacturing and consumption purposes. 

This is because many countries targeted by high tariff rates under the EO, including Cambodia (49%), Vietnam (46%), Thailand (32%), and Indonesia (32%), serve as popular options for the “China plus One” manufacturing strategy, which leverages low-cost manufacturing in China alongside alternative and active alternative suppliers outside of it. 

But now, with manufacturing in China being strongly disincentivized for many products and many popular alternative manufacturing locations also having relatively high tariff rates, many businesses are evaluating their plans for future manufacturing locations and their supply chain strategies more broadly.

In this article, we look at two key factors companies must consider when planning to move manufacturing locations in response to new tariffs, as well as what countries are currently poised to benefit the most from the ongoing trade war. 

Getting Started: Two Key Considerations

To navigate these challenges, companies must evaluate two critical factors when assessing foreign manufacturing locations that ship goods to the U.S. market: the tariff landscape and country-specific considerations. While there are other factors to also consider, these two areas represent a significant portion of what companies must assess. 

The Tariff Landscape: Things to Consider

Reconfiguring a supply chain in a new country is often a costly, time-consuming, and labor-intensive process. Before making the leap to move manufacturing away from high-tariff areas and back to the U.S. or other new countries, businesses should consider the following:

Which Tariffs Currently Apply to Your Products, If Any

First: Check to see if the goods being manufactured abroad are actually subject to tariffs in the U.S. It may come as a surprise, but many critical commodities across industries like electronics, such as semiconductors, diodes, transistors, and other highly specialized electronic components, are currently exempted from the high tariffs on Chinese goods. Additionally, many other commodities have tariff exemptions or reductions depending on the industry and Country of Origin. Make sure to check if high-value goods will actually be impacted by tariffs.

Trump’s Tariffs May Be a Short-Term Challenge

Second: Tariff longevity—perhaps the ultimate trend to monitor in this new tariff era—is critically important to consider before moving manufacturing to a new country. This is because the presidential authority used to enact these tariffs could be easily reversed by a new administration in just four years. Additionally, there are several lawsuits pending against the Liberation Day tariffs that must play out in court. 

For many companies, it may not be worth seeking long-term partnerships with manufacturers in new countries to subvert tariffs that may not apply in the long run. Moreover, many tariff programs enacted by the Trump administration have been delayed in implementation, and it’s possible even the Liberation Day tariffs could be delayed beyond their current July deadline. 

All in all, companies should be cautious when evaluating the longevity of tariffs and should take steps to consider that all of Trump’s tariffs may be reduced, removed, or delayed before making decisions to move manufacturing locations to new countries.

There Could Be Trade Deals Around the Corner

Third: Potential bilateral trade deals could be signed with specific countries. The Trump administration has already signed a trade deal with the UK and is in active negotiations with China. The administration also claims that many other countries have been attempting to negotiate trade deals as well. In principle, the main effect of these trade deals will likely be reduced tariff rates. This means that companies that have risk exposure from countries with high tariffs may want to wait to see if a deal can be negotiated, especially during the tariff pause that lasts until July 9, before making any final decisions. Companies should monitor the progress of trade talks (if any) that may affect tariff rates in countries where they currently manufacture goods that will be exported to the U.S.

Tariff Recalculations Make Big Moves Risky

Fourth: Tariff rate recalculation is a formidable risk that could threaten to undo all of the work a company might put into moving manufacturing to a new country. While the EO announcing the Liberation Day tariffs makes no mention of a recalculation schedule using the declared formula, Trump has repeatedly mentioned in many cases that tariffs may be adjusted higher or lower for specific countries based on current trade conditions. This presents a significant risk: countries that become popular destinations for manufacturing due to new U.S. tariff policies could be hit with higher tariffs—either arbitrarily or through a standard tariff recalculation—if the U.S. sees a surge in imports from those countries.

To mitigate this risk, companies should consider the Total Cost of Ownership (TCO) for the products they will manufacture at a new site and come to a fundamental understanding of tariff risk tolerance and appetite before moving manufacturing locations to a new country.

Country-Specific Considerations: Things to Consider

For companies that decide to reconfigure their supply chains in response to tariffs, carefully evaluating the destination country is critical. While moving to the U.S. certainly offers many domestic advantages, the reality for many industries is that it will be difficult to manufacture products that would be competitive in other foreign markets with products coming from low-cost manufacturing countries like China, Vietnam, and Cambodia, which benefit from lower production costs and favorable export conditions. If the Liberation Day tariffs continue, many low-cost manufacturing countries are likely to benefit from this new trade dynamic and relatively low U.S. tariffs.

10% Could Be the New Baseline Import Cost

If products from all countries worldwide (absent trade agreements/exceptions) are subjected to a 10% baseline tariff when entering the U.S., this will reset the effective baseline import cost to the U.S. This means that products coming from countries at the 10% tariff rate (or close to this rate) will effectively be importing goods at the lowest possible rate for goods that do not have exceptions. Therefore, the challenge for many companies will be finding countries with similar manufacturing profiles to their current locations while still benefiting from lower labor costs and established local manufacturing ecosystems.

Which Countries Could Be the Biggest Winners From Trump’s Tariffs?

As mentioned, there are many more considerations companies must account for beyond tariffs when deciding to move manufacturing locations. Z2Data evaluates 10 country-level criteria—such as credit rating, military conflict risk, ease of doing business, and political stability—alongside city- and region-specific factors like extreme weather and public health risks to provide a comprehensive location score for manufacturing decisions. 

The key when choosing a new country for manufacturing operations is to consider: 

• Manufacturing in countries where supply chain stability can be maintained
• Locations that ideally already have manufacturing ecosystems of sub-tier suppliers already in place to support complex manufacturing operations 

Below are a few of the countries identified using Z2Data’s Country Risk Score (which measures the risk of operations in a given country) and associated Liberation Day Tariff Rate data (as of 5/23/2025) that are likely to benefit from Trump’s tariffs.

Brazil (U.S. Tariff Rate: 10%) 

Apple previously announced they would be moving production to Brazil for their iPhone 16e product, and many automotive companies already manufacture goods in the country. While Z2Data rates Brazil as Medium Risk due to challenges with political stability, labor rights, and ease of doing business. However, many Brazilian cities face relatively low risks from natural disasters and power outages, contributing to more stable manufacturing operations in those areas.

Mexico (U.S. Tariff Rate: Free, Dependent on Item and COO)

Many U.S. companies are already very familiar with Mexico as a low-cost “nearshoring” option for manufacturing. With the U.S.-Mexico-Canada (U.S.MCA) agreement offering tariff-free access to the U.S. for goods manufactured in Mexico, there is a viable pathway for many companies to shift final assembly and manufacturing to Mexico to benefit from this agreement. 

Mexico is rated as a Medium Risk country according to Z2Data’s country risk score. The country benefits from minimal cybersecurity risks and military conflict risks but struggles with political stability, inflation, and its credit rating. Many cities in Mexico have limited environmental disruption risks and disruption incidents based on Z2Data’s analysis, which generally means a stable manufacturing environment.

Malaysia (U.S. Tariff Rate 24%)

While the tariff rate on Malaysia is more than double the 10% rate, it is still noteworthy for having an established and growing electronics manufacturing sector that may make a transition to this country for companies already in this region much less painful. According to Z2Data’s Country Risk score, Malaysia is rated as Medium Risk due to its risk for flooding and labor rights issues, but it ranks well for ease of doing business, cybersecurity, and minimal weather-related impacts relative to other countries.

Morocco (U.S. Tariff Rate 10%)

Before the Liberation Day tariffs, Morocco was one of the few countries with free trade agreements with both China and the U.S., and it has long been leveraged by European companies for its cheaper labor and energy costs. Now, Morocco is seeing manufacturing investment from companies all around the world. The North African country is rated as Medium Risk by Z2Data’s country scoring system. While Morocco does have political stability and ease of doing business risks, established companies there benefit from very few natural disaster risks and very limited site disruptions, according to Z2Data’s event monitoring records.

In Conclusion

While these are just a few of the countries that could serve as low-cost manufacturing alternatives for companies looking for every option to remain competitive in both the U.S. and global markets, there may be many more depending on the specific set of circumstances at a given company. 

Z2Data offers tools such as Supplier Insights and Supply Chain Watch that enable companies to continuously monitor their supply chains for emerging risks and evaluate potential countries and suppliers based on a wide range of criteria. Whether you’re looking to respond to tariff changes, assess geopolitical or natural disaster impacts, or identify new sourcing opportunities to stay resilient, Z2Data gives you the data you need to make informed decisions for your supply chain.

To learn more about how Z2Data can help you screen countries or suppliers for manufacturing suitability, schedule a free trial.