• Global goods trade volumes rose 4.6% in 2025, beating expectations
• AI-driven demand helped offset tariffs and policy uncertainty
• Growth could slow to 1.9% in 2026 amid geopolitical risks

Global trade held up better than expected in 2025, but that resilience may not carry into the year ahead, according to a report released March 19 by the World Trade Organization.

The WTO said global merchandise trade volumes grew 4.6% in 2025, well above its October forecast of about 2.4%.

Strong demand for goods tied to artificial intelligence, fueled by a global investment boom in the sector, helped offset the drag from higher tariffs and rising trade policy uncertainty, the report said.

In value terms, global merchandise exports reached $26.26 trillion in 2025, up 7% from 2024.

Services trade totaled $9.56 trillion, also up 8% year over year. Combined trade in goods and services, measured on a balance-of-payments basis, rose 7% to $34.65 trillion.

A Tougher Outlook for 2026

Despite stronger-than-expected growth last year, the WTO expects a sharp slowdown in 2026. It projects merchandise trade volumes will rise just 1.9%.

That outlook could weaken further if geopolitical tensions intensify. The ongoing conflict in the Middle East, including recent escalation involving Iran, Israel, and the United States, has already disrupted trade flows through the Strait of Hormuz and pushed oil prices higher.

If elevated oil prices persist, they could shave 0.5 percentage points off global trade growth in 2026, the WTO said. On the other hand, continued strength in AI-related trade could add a similar margin, leaving the balance of risks uncertain.

The conflict could also weigh on services. Prolonged tensions may keep transport and fuel costs high, disrupt key shipping and air routes, and reduce tourism demand, the report said.

Looking further ahead, the WTO expects a modest rebound in 2027. In its baseline scenario, merchandise trade growth would rise from 1.9% in 2026 to 2.6% in 2027. Services trade growth would ease from 5.3% in 2025 to 4.8% in 2026, before edging up to 5.1% in 2027.

The United States, China, and Germany continue to dominate global merchandise trade. The U.S. remained the world’s largest importer in 2025 with $3.507 trillion in imports, while China led exports at about $3.772 trillion. Germany ranked third in both imports and exports.

Espoir Olodo