GLOBAL TARIFFS SPILLOVERS AND SECTORAL VULNERABILITY: CASE OF NORTH MACEDONIA
GLOBAL TARIFFS SPILLOVERS AND SECTORAL VULNERABILITY: CASE OF NORTH MACEDONIA

Summary/Abstract: The re-imposition of U.S. tariffs in 2025 has intensifiedglobal trade fragmentation and renewed uncertainty in international markets.While tariff impacts are often assessed through direct bilateral trade flows,their most significant effects increasingly arise through indirect spilloversembedded in global and regional value chains. This paper examines the sec-toral implications of renewed U.S. tariffs using North Macedonia as a casestudy. Although the country’s direct export exposure to the U.S. market re-mains limited - accounting for approximately 1 to 1.4 percent of total exports(2021-2024), the analysis shows that indirect effects transmitted through Eu-ropean Union’s supply chains pose substantially greater risks. Sectors suchas automotive components, metals, and chemicals are particularly vulnera-ble due to high export concentration, deep integration into EU manufacturingnetworks, and sensitivity to global price volatility. Drawing on internationaltrade literature, sectoral assessments, and national trade data for 2021–2024,the paper identifies key transmission channels and discusses implications forforeign direct investment, nearshoring, and economic resilience in small openeconomies.The findings underscore that strengthening sectoral competitive-ness, policy coordination, and export diversification is essential for enhancingresilience in small open economies facing an increasingly fragmented globaltrade environment.

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