Global commerce is expected to slow down in 2026 after experiencing strong expansion in 2025, largely fueled by increased demand for artificial-intelligence-related products. However, the ongoing Middle East conflict is projected to put additional pressure on international trade and could further weaken growth.
This projection comes from the latest Global Trade Outlook and Statistics report released by the World Trade Organization. According to the publication, the growth rate of global merchandise trade volume is forecast to decline from 4.6% in 2025 to about 1.9% in 2026, before improving slightly to 2.6% in 2027. Meanwhile, trade in services is expected to moderate from 5.3% growth in 2025 to 4.8% in 2026, with a mild increase to 5.1% in 2027.
During 2025, the combined value of global goods and services trade increased by approximately 4.7%, exceeding the world GDP growth rate of 2.9%. For 2026, economists anticipate that trade expansion and GDP growth will move at nearly the same pace, with trade rising around 2.7% and global economic output increasing by roughly 2.8%.
The report also highlights that the total value of global merchandise exports reached about US$26.26 trillion in 2025, representing a 7% rise compared with 2024. Trade in services climbed to around US$9.56 trillion, reflecting an 8% increase over the same period. When calculated using balance-of-payments data, the total value of goods and services trade stood at US$34.65 trillion in 2025, marking a year-on-year gain of 7%.
Despite this strong performance, WTO analysts warn that sustained increases in oil prices caused by the Middle East conflict could reduce the expected 1.9% merchandise trade growth in 2026 by about 0.5 percentage points. On the other hand, trade could improve by the same margin if demand for AI-related technologies remains as strong as it was in 2025.
The report further states that the conflict could affect services trade just as much as goods trade. Growth in services could fall by about 0.7 percentage points in 2026 due to risks affecting global transport, aviation, and tourism industries.
A prolonged geopolitical crisis may keep shipping and fuel expenses at high levels, interrupt key sea and air routes, and reduce tourism activity across several regions. These developments could weaken global travel demand and slow economic activity in multiple sectors.
Apart from energy supply concerns, the blockade of the Strait of Hormuz has also affected fertilizer shipments that are vital for global agricultural production. Nearly one-third of the world’s fertilizer exports normally pass through this route, making the disruption a major risk for food supply chains.
Large agricultural economies such as India, Thailand, and Brazil rely heavily on fertilizer imports from the Gulf region, accounting for about 40%, 70%, and 35% of their urea supply respectively. At the same time, Gulf countries depend heavily on imported food, with roughly 75% of rice and more than 90% of corn, soybeans, and vegetable oil coming from abroad. Alternative shipping routes could therefore increase costs significantly for both exporters and importers.
Speaking during the presentation of the report, WTO Director-General Ngozi Okonjo-Iweala stated that global trade has shown resilience thanks to strong demand for high-technology products, growth in digitally delivered services, and improved supply-chain adjustments. She also noted that the absence of large-scale tariff retaliation helped maintain stability in 2025.
However, she warned that the Middle East conflict remains a serious risk to the baseline forecast. Continued increases in energy prices could create wider economic pressure, including higher food costs and increased expenses for consumers and businesses worldwide.
Dr. Okonjo-Iweala emphasized that WTO member countries can reduce the negative effects by maintaining stable trade policies, avoiding sudden tariff increases, and strengthening supply chains to ensure smoother movement of goods across borders.
Trade Growth Performance in 2025
According to data available as of March 10, the volume of global merchandise trade grew by 4.6% in 2025, which was higher than the 2.4% growth predicted in the October 2025 outlook. The stronger-than-expected performance was partly due to the temporary suspension of new tariffs by the United States until August, limited retaliatory measures from other economies, and several exemptions applied to certain products.
Another important factor supporting trade growth was the sharp rise in demand for AI-enabling goods. The total value of trade in these products increased by 21.9% year-on-year, reaching about US$4.18 trillion in 2025 compared with US$3.43 trillion in 2024.
Although these goods represent only a small portion of global trade, they accounted for roughly 42% of the total growth recorded in 2025. Many AI-related products such as semiconductors, advanced chips, and data-transmission equipment remain excluded from most tariff increases, which helped keep trade flowing.
For 2026, WTO economists believe that recent tariff changes mainly reflect adjustments in strategy rather than major policy shifts. By the end of February 2026, around 72% of world trade was still conducted under the Most-Favoured-Nation system, meaning countries apply the same tariff rates to most trading partners.
This confirms that MFN tariffs continue to be the primary framework governing international trade across most industries.
Regional Trade Forecast
Under the baseline forecast, Asia is expected to record the fastest merchandise import growth in 2026 at around 3.3%, followed closely by Africa at 3.2%, South America at 2.5%, Europe at 1.3%, and the Middle East at 1.0%.
North America’s import growth is projected to remain almost unchanged at 0.3%, while the Commonwealth of Independent States region could see a decline of about 2%.
On the export side, Asia and South America are expected to lead with growth of about 3.5% each. North America may grow by 1.4%, the CIS by 1.3%, and Africa by 1.2%. In contrast, the Middle East is forecast to experience slower export growth of around 0.6%, while Europe may remain nearly stagnant at about 0.5%.
Least-developed countries are projected to record import growth of about 4.5% and export growth of roughly 2.9% in 2026 under the baseline scenario.
If energy prices remain high, regions that depend heavily on imported fuel such as Asia and Europe could experience the largest decline in trade growth. In contrast, countries that export fuel may benefit from higher income levels, allowing them to increase imports despite the difficult conditions.
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