09/10/2026 09:11 AST
The World Trade Organization (WTO) has upgraded its global merchandise trade growth forecast for 2026 to 3.9%, a significant jump from its previous 1.9% projection made in March.
The upward revision is primarily driven by surging investments in artificial intelligence (AI) and adaptable supply chains, which have successfully cushioned economic shocks from the ongoing Middle East conflict.
The latest WTO Global Trade Outlook and Statistics report expects 4.1% growth in 2027, up from a previous forecast of 2.6%, and marginally below 2025 trade volume growth of 4.2%.
A surge in spending on semiconductors and AI data centers provided a significant boost, with trade in those products jumping 67% from a year earlier, the report said.
It said in the first half of 2026, AI-enabling goods such as semiconductors and servers accounted for 47% of global merchandise trade growth.
The WTO said merchandise trade had proved more resilient than expected in the face of disruptions, as stronger demand for AI-related products offset some of the impact of the war and supply chain disruptions.
However, the Geneva-based trade watchdog downgraded its outlook for services trade to 3.3% in 2026, down ?from a previous baseline forecast of 4.8%, due to higher aviation fuel costs linked to the conflict in the Middle East.
Growth forecasts this year for transport and travel services, both of which rely heavily on the region, were also cut to 0.9% and 0.2%, respectively. Services trade growth is forecast to rebound to 6.4% in 2027.
Regional Disparities
The WTO report said Asia is set to lead merchandise trade growth in 2026, with imports rising 9.5% and exports 9.9%, while Africa is also expected to post strong growth, with imports up 8.9% and exports ?up 5.6%.
Import growth is forecast to remain subdued in North America at 1.4%, although exports are expected to increase 5.7%. By contrast, both imports and exports in the Middle East are projected to contract sharply, falling 15.4% and 17.2%, respectively.
The WTO said signs of wider fragmentation between rival geopolitical ?trade blocs had eased while world GDP is expected to grow by 2.6% in 2026, with the largest gains in Asia at 4.3%, followed by Africa and South America, while the Middle East is expected to see a sharp drop in output of 4%.
AI Leads Trade
The report also noted one of the widest gaps in recent years between the growth in world merchandise trade volumes - at 3.5% year-on-year in the ?first half of 2026 - and the dollar value of trade, at 15%, reflecting higher prices for energy products and strong demand for AI-enabling goods.
In value terms, AI-enabling goods accounted for nearly half of global merchandise trade growth in the first half of 2026, but remain highly geographically concentrated, the report said.
It then warned that several risks could still affect the forecast such as diminishing household purchasing power due to higher fuel and fertilizer costs linked to disruption of the Strait of Hormuz, a critical route for global energy supplies, and the Russian war in Ukraine, as well as any slowdown in AI investment.
Also, the WTO said signs of wider fragmentation between rival geopolitical ?trade blocs had eased, but decoupling between the US and China had accelerated and was now the main driver of divergence in global trade patterns.
US imports from China fell 29% in 2025, reducing China's share of total US imports to 9.3% from more than 20% before trade tensions between the world's two largest economies flared up in 2018, the report said.
Asharq Al Awsat
Please wait...