GENEVA (Realist English). The World Trade Organization (WTO) on Tuesday revised upward its forecast for global trade growth in 2025 but cautioned that momentum will fade in 2026 amid a cooling global economy and the full impact of higher tariffs.
In its latest Global Trade Outlook and Statistics report, the WTO said world trade volumes are now expected to grow 2.4% in 2025, up from the 0.9% projected in August. However, it cut its 2026 forecast from 1.8% to a modest 0.5%, warning that rising tariffs and policy uncertainty will take a toll on global commerce.
“Trade growth is expected to slow in 2026 as the global economy cools and as the full impact of higher tariffs is finally felt for a full year,” the WTO said.
Front-loaded gains and AI demand
Global trade volumes surged 4.9% year on year in the first half of 2025, driven by several temporary factors. Companies rushed to import goods into the United States ahead of new tariffs announced by President Donald Trump in April, while disinflation, fiscal stimulus, and tight labor markets lifted consumer spending in major economies.
The report also credited the boom in artificial intelligence-related goods — such as semiconductors, servers, and telecommunications equipment — with fueling nearly half of the year’s trade expansion, with AI-related exports rising 20% in value terms.
The U.S. accounted for roughly one-fifth of global AI-related trade growth in early 2025, while Asia contributed nearly two-thirds, reflecting its dominance in semiconductor production and digital supply chains.
“Trade growth spanned the digital value chain, from raw silicon and specialty gases to devices powering cloud platforms and AI applications,” the WTO said.
Tariff shock and policy risks
The WTO noted that the global trade environment has become increasingly fragmented since Washington’s tariff regime reshaped cross-border flows earlier this year. Even traditional U.S. allies such as the United Kingdom continue to face a 10% baseline tariff on exports to the American market.
Economists warned that the spread of trade-restrictive measures could deepen the slowdown in 2026. At the same time, sustained investment in AI and clean technology could offer some resilience in the medium term.
Global services exports are also expected to decelerate — from 6.8% growth in 2024 to 4.6% in 2025 and 4.4% in 2026 — as weaker goods trade and output spill over into related sectors.
Signs of fatigue in developed economies
The WTO said early signs of weakness are already visible in advanced economies, where business confidence, employment, and income growth are slowing.
WTO Director-General Ngozi Okonjo-Iweala said the 2025 rebound demonstrated “the resilience of global trade and the stabilizing effect of the rules-based multilateral trading system,” but she warned that “complacency is not an option.”
“Today’s disruptions to the global trade system are a call to action for nations to reimagine trade and build a stronger foundation for shared prosperity,” she said.
