WTO Global Trade Outlook

Global goods trade is expected to pick up gradually this year following a contraction in 2023 that was driven by the lingering effects of high energy prices and inflation, WTO economists said in a new forecast on 10 April.

The volume of world merchandise trade should increase by 2.6% in 2024 and 3.3% in 2025 after falling 1.2% in 2023. However, regional conflicts, geopolitical tensions and economic policy uncertainty pose substantial downside risks to the forecast.

In value terms, the decrease in merchandise trade by 5% in 2023 to US$ 24.01 trillion was somewhat balanced by a robust 9% growth in commercial services trade, culminating in a total trade reduction of only 2%.

Notably, digitally delivered services have shown significant resilience and growth, totaling US$ 4.25 trillion in 2023, a 9% increase from the previous year and representing 13.8% of global exports. These services have now surpassed pre-pandemic levels by more than 50%.

Regionally, Europe significantly impacted the decline in merchandise trade volume between 2022 and 2023. However, looking ahead, all regions, particularly Asia, are expected to contribute positively to growth in both export and import volumes in 2024. Asia's contribution is particularly anticipated to be strong, enhancing global export growth by about 1.3 percentage points and import growth by 1.9 percentage points.

Despite the broader recovery, ongoing regional conflicts and geopolitical tensions may restrict trade rebound by triggering further price increases in food and energy sectors. Instances such as the Suez Canal disruptions due to Middle Eastern conflicts have impacted various sectors, including automotive and fertilizers, primarily through delays and increased freight costs.

Additionally, the evolving geopolitical landscape is reshaping trade patterns, evident from the slowed growth in bilateral trade between the United States and China compared to their trade with other global partners. Trade among geopolitically aligned countries has grown slower compared to intra-bloc trade since the onset of the conflict in Ukraine.

The volume of world merchandise trade remained robust compared to pre-pandemic levels, and trade growth, though subdued compared to real GDP growth, indicates underlying economic stability.

Going forward, with expected easing of inflationary pressures and potential reductions in interest rates, a rebound in demand for manufactured goods is anticipated, supported by improving real incomes, particularly in advanced economies.

This should encourage stronger consumption and heightened import demand through 2024 and 2025, supporting a gradual strengthening of the global trade environment.

[WTO Release].  [Global Trade Outlook and Statistics]