U.S. Trade Deficit Hits Record High on Pre-Tariff Drug Imports

May 7, 2025 -- Today's top stories: U.S. Trade Deficit Hits Record High on Pre-Tariff Drug Imports, DOJ Seeks Breakup of Google’s Ad Tech Business, and Alibaba’s Qwen AI Models Gain Ground in Japan.

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By CommonWealth Magazine
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2025-05-07

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U.S. trade deficit widens to a record on pre-tariff drug imports

The U.S. trade deficit widened to a record high in March, rising 14% from February's revised US$123.2 billion, according to new data from the Census Bureau and Bureau of Economic Analysis. Imports of consumer goods climbed by the highest on record, primarily due to the largest-ever inflow of pharmaceutical preparations. Imports of capital equipment and motor vehicles also increased.

The report illustrates what was likely the final push by U.S. companies to secure goods before President Donald Trump announced expansive duties on April 2.

While drug imports were excluded, the president has said a decision on pharmaceutical tariffs will be made in the coming weeks.

The dramatic widening of the trade deficit in the first quarter was the key reason the economy contracted. Imports alone have risen 23.3% so far this year and were US$17.8 billion higher just last month, the Bureau of Economic Analysis said. Exports from the U.S. to other countries increased by just US$500 million.

Trump's tariffs, which already amount to more than 145% on China, are set to increase in just under 65 days after they were initially paused.

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U.S. Justice wants Google to sell two advertising products to restore competition

(Source: Reuters)

The U.S. Department of Justice (DOJ) has proposed that Google sell two of its advertising products to restore competition in the ad tech space.

The move comes after a judge found Google guilty of “willfully acquiring and maintaining monopoly power” in the digital ad space last month.

The DOJ’s filing notes that Google should divest its ad exchange product ADX, along with a “phased” sale of DoubleClick, an ad server for website publishers.

The department also wants Google to avoid running an ad exchange for 10 years post the sale of ADX.

The DOJ alleged Google had “ensured that publishers would lose significant revenue if they did not use ADX”.

The DOJ said the proposed remedies, including divestitures, are necessary to end Google's monopolies and restore competition in the ad exchange and publisher ad server markets.

The proposed remedy joins a separate federal effort to separate the Chrome browser from its dominant search engine.

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Alibaba's Qwen is foundation for more and more Japanese AI models

(Source: Reuters)

Qwen, a family of AI large language models developed by Alibaba Cloud, is increasing its presence in Japan as local startups like Abeja use the open-source service to develop their own models, some of which now rank among the world's best.

Abeja, which develops systems that analyze physical spaces, announced on April 17 its new Qwq-32B reasoning model, which demonstrated a high ability to link decisions together and output complex answers. The basis for the development of this model was Alibaba's Qwen model.

Qwen's closed models released in January, with Qwen2.5-Max coming in sixth out of 113 models in a ranking by Nikkei Digital Governance and U.S.-based artificial intelligence developer platform Weights & Biases on the performance in Japanese of major models from the U.S., China, Japan and elsewhere.

Qwen's open models also demonstrate high performance.

Qwen2.5-32B was no. 26 in the Nikkei ranking, beating Google's Gemma-3-27B open AI model, which made 32nd place, and Meta's Llama 3 70B instruct, which came in 57th. Open AI models can be trained by outside companies to develop their own AI.

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