What happened
The World Trade Organization (WTO) forecasts a "two-speed" global trade environment for 2026, driven by surging artificial intelligence (AI) demand and destabilising geopolitical conflicts. Global merchandise trade volumes expanded 4.6% in 2025, with AI-related goods accounting for nearly 50% of this growth, despite representing one-sixth of total trade. The WTO forecasts merchandise trade growth to slow to 1.9% in 2026, potentially falling to 1.4% if Middle East conflicts elevate energy costs. Conversely, sustained AI investment could add 0.5 percentage points to trade growth.
Why it matters
Global supply chain architects and procurement teams face divergent pressures as AI-driven demand clashes with geopolitical instability. AI-related goods, which grew 21.9% year-on-year and comprised nearly 17% of trade by 2025, continue to drive growth, offering a potential offset to rising energy and transport costs. However, the risk of merchandise trade growth dropping from 1.9% to 1.4% due to Middle East conflicts necessitates re-evaluating logistics and sourcing strategies. This dynamic requires investors to assess exposure to both AI infrastructure and volatile energy markets.
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