WORLD – A report by the World Trade Organization (WTO) stated that global goods trade growth will slow sharply to 1.9% this year, compared to 4.6% in 2025.
The slowdown could be worse if the war in the Middle East continues to push energy prices up and disrupt global supply chains.
The report noted that last year’s better-than-expected performance was driven by a surge in trade related to artificial intelligence (AI), as well as accelerated shipments to avoid a wave of U.S. tariffs.
Although global trade still shows some resilience thanks to AI products, forecasts face increasing pressure due to the widening scope of the conflict, according to WTO Director-General Ngozi Okonjo-Iweala.
WTO economists said that if crude oil and liquefied natural gas prices remain high throughout 2026 due to the conflict, global goods trade growth could slow further to 1.4%. The report also warned that a continued closure of the Strait of Hormuz by Iran, which disrupts about a third of urea imports used in fertilizers, could harm major producers like India, Thailand, and Brazil, increasing food security risks.
The report added that rising energy prices could reduce global goods trade growth by about 0.5 percentage points, with Asian and European economies dependent on fuel imports facing the most pressure. It also forecast a decline in services trade growth by 0.7 points, from 4.8% to 4.1%, due to shipping and flight disruptions, noting that the sector grew by 5.3% last year.
AI Trade Growth… A Question Mark
The report explained that global goods trade grew last year at about twice the expected rate, driven by higher demand for AI-related goods such as chips and semiconductors, offsetting the impact of U.S. tariffs and trade fluctuations.
These goods accounted for 42% of global trade growth in 2025, even though they represent only one-sixth of total trade, rising 21.9% year-on-year to $4.18 trillion.
However, the report noted that continued strong investment in this sector remains “highly uncertain” for 2026 and beyond.
The WTO expects trade in goods and services and global GDP to grow at similar rates this year, around 2.7% for trade and 2.8% for global GDP, compared to 4.7% and 2.9% last year, respectively.
Regionally, Asia is expected to lead goods import growth in 2026 with a 3.3% increase and exports by 3.5%, followed by Africa with imports up 3.2% and exports 1.2%, while North American imports are expected to remain nearly flat at 0.3%.
Economists also noted that about 72% of global trade is now conducted under the “Most-Favored-Nation” principle, down from about 80% at the start of last year, after higher tariffs were imposed. This principle requires WTO members to treat their trade partners equally.
Okonjo-Iweala said this slowdown is an important lesson ahead of the WTO meeting in Cameroon next week, where trade ministers will discuss reforms to the global trading system, stressing that “the rules-based system may be under pressure, but it is far from collapsing.”
