The World Trade Organisation sharply lowered its 2026 forecast for global merchandise trade volume growth to 0.5 per cent yesterday, citing expected delayed impacts from US President Donald Trump’s tariffs.
It marks a significant revision down from its previous estimate in August of 1.8pc growth.
“The outlook for next year is bleaker ... I am very concerned,” Director-General Ngozi Okonjo-Iweala told reporters in Geneva.
However, she said the world trading system is showing resilience, with the rules-based multilateral system providing some stability amid trade turmoil.
For 2025, the WTO upgraded its forecast for global trade volume growth to 2.4pc, from 0.9pc previously, driven primarily by the front-loading of imports into the US ahead of tariff hikes and growth in the trade of AI-related goods. It is still below the 2.8pc growth seen in 2024.
Trump’s tariff decisions since he took office in January have shocked financial markets and sent a wave of uncertainty through the global economy.
On August 7, Trump imposed higher tariffs on imports from dozens of countries, leaving major trade partners like Switzerland, Brazil and India scrambling for a better deal, while the EU struck a deal that set duties at 15pc on most EU goods imported into the US.
Overall world merchandise trade volume growth is expected to slow from 2.8pc last year to 2.4pc this year and 0.5pc next year.
The WTO also forecasts global GDP growth to ease slightly from 2.7pc in 2025 to 2.6pc in 2026.
In the first half of 2025, world merchandise trade volume, measured by the average of exports and imports, increased by 4.9pc year-on-year, with trade value rising 6pc compared to 2pc growth in 2024, according to the WTO report.
Consequently WTO economists upgraded their trade growth forecast for this year to 2.4pc, above April’s prediction of a 0.2pc fall.
The rush of exporters to send goods including machinery, motor vehicles, and lumber to the US before the tariff increases, alongside a surge in demand for AI-related products, contributed to this growth, the report found.
Trade in AI-linked goods such as semiconductors and telecommunications equipment accounted for nearly half of overall trade growth, rising 20pc year-on-year. Asia’s export performance was particularly strong, the report said.
Asia and Africa are expected to see the fastest export volume growth this year, while Europe’s export growth will slow and North America’s is set to decline. All regions are projected to experience weaker import performance in 2026.
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