The latest update from the World Trade Organization (WTO) signals a mixed picture for global trade—and that has direct implications for businesses, exporters, and supply-chain planners alike. On the one hand, the WTO has raised its forecast for world merchandise trade growth in 2025. On the other hand, it warns of a sharp slowdown in 2026. If you’re wondering what this means for your business or global trade strategy, you’re not alone. Many businesses face a two-fold problem: capitalising on near-term upside while preparing for a leaner year ahead. The good news? By understanding the forecast and adjusting proactively, you can turn this challenge into opportunity.
In this article, we’ll break down the WTO’s key revisions, explain what’s driving them, and offer practical strategies to help your business adapt—whether you’re an exporter, supply-chain manager, or international trade strategist.
Understanding the WTO’s Revised Trade Outlook
What changed?
According to the WTO’s October 2025 “Global Trade Outlook and Statistics” update, merchandise trade volume is now projected to grow by 2.4% in 2025, up from just 0.9% in the August estimate. Modern Distribution Management+2World Trade Organization+2 Yet, for 2026, the outlook is far weaker: growth is now expected at only about 0.5%—a steep downgrade from the previous ~1.8%. Modern Distribution Management+1
On services trade, the forecast moves from 6.8% growth in 2024 to 4.6% in 2025 and 4.4% in 2026. World Economic Forum+1
What’s driving the upgrade for 2025?
Several factors underpin the stronger-than-expected performance:
- In the first half of 2025, merchandise trade volume rose ~4.9% year-on-year and trade value ~6%. m.jctrans.com+1
- A surge in “front-loading” of imports, especially in North America, ahead of tariff hikes. ikargos.com+1
- Strong demand for AI-related goods (semiconductors, servers, communications equipment) which reportedly accounted for nearly half of the overall trade expansion in that period. Modern Distribution Management+1
- Growth in trade among emerging markets (“South-South trade”) which lifted export activity outside traditional Western markets. m.jctrans.com+1
Why the weak outlook for 2026?
Despite the near-term lift, several risks and structural issues cloud the outlook for next year:
- The boost from advance imports (front-loading) isn’t sustainable—once inventory buffers build, demand can drop. World Trade Organization+1
- Slowing global GDP growth, geopolitical/trade-policy uncertainty and higher tariffs risk reducing trade momentum. World Economic Forum+1
- Services trade, which often depends on business/consumer confidence and travel, is expected to lose steam.
What This Means for Businesses, Exporters & Supply Chains
Short-term opportunity (2025)
For businesses positioned well, 2025 offers a window of opportunity:
- Exporters of goods tied to tech/AI sectors: The strong demand for semiconductors, servers and components is a tailwind.
- Supply-chain planners: With trade volumes up, companies can move to optimise inventory, negotiate favourable logistics/transport terms and capture global demand.
- Emerging-market businesses: The growth of South-South trade means diversification beyond default markets may pay off.
Mid-term caution (2026)
However, the weak 2026 outlook means companies should not become complacent:
- If your business relied on 2025 spikes (e.g., front-loaded imports) you may face overstock, margin pressure or demand softening.
- Regions/markets that lag may feel sharper impacts—planning and flexibility will be key.
- Services-heavy businesses (travel, transport, digital exports) should temper expectations and budget conservatively.
Practical Strategies to Navigate the Shift
1. Scenario-plan for both upside and downside
Create dual plans: one for the “boost continues” scenario and one for the “slowdown hits” scenario.
- Map inventory, procurement and cap-ex decisions against both growth and contraction in trade.
- Use triggers (e.g., tariff announcements, PMI data, shipping congestion) to switch between scenarios.
- Maintain flexibility in contracts—e.g., logistics, warehousing—and avoid over-committing.
2. Diversify trade partners and product mix
Given the uneven regional performance and sector shifts:
- Explore emerging-market trade corridors (e.g., Africa, South-East Asia) where growth is stronger.
- Broaden your product portfolio if you’re tied to one niche (especially if it’s vulnerable to policy or demand shocks).
- Embrace value-added goods—not just raw exports—to build resilience.
3. Harness tech, data and logistics agility
The strong link between AI-related goods and trade growth means tech matters:
- Use data analytics to anticipate demand shifts and manage inventory leanly.
- Optimise supply chains: shorter lead-times, multiple sourcing, regional logistics hubs.
- Monitor trade policy changes and tariffs: being agile can save cost and market share.
4. Manage working capital and inventory carefully
With uncertainty ahead, your balance sheet matters:
- Avoid large build-ups of inventory simply because of 2025 momentum—if 2026 slows, that’s a risk.
- Negotiate flexible payment/credit terms with suppliers and logistics partners.
- Monitor cash-flow impact of delayed shipments, tariff changes or demand drops.
5. Keep an eye on trade policy and global signals
Key external factors could shape trade in 2026:
- Tariff/escalation risks, especially between major powers (e.g., US-China).
- Global economic slowdown or credit constraints reducing demand.
- Technological shifts: growth in digital trade, supply-chain decoupling, localisation of production.
Stay plugged into sources such as the WTO’s updates for early warning.
How to Translate the Outlook into Action for Your Business
Exporters
- Use the 2025 momentum to lock in favourable contracts now but avoid assuming similar growth in 2026.
- Explore growth in markets outside your usual circle, especially in emerging economies.
- Highlight tech-/AI-related content in your value proposition if relevant.
Supply-chain managers
- Review lead-time and logistics risk for 2026; establish alternate routes and backup suppliers.
- Focus on inventory turnover rather than accumulation.
- Use data to monitor demand trends rather than relying solely on past growth.
Service-based trade (digital, travel, transport)
- Realise that growth is expected to decelerate; budget accordingly.
- Diversify service offerings and geographic reach.
- Invest in digital platforms and innovation to remain competitive in slower growth conditions.
Final Thoughts
The WTO’s revised trade forecasts reveal a nuanced trade environment: an upgraded 2025 outlook offers hope, but the 2026 slowdown warns against complacency. For businesses and exporters, the key lies in managing this transition intelligently: seize the near-term growth window, but build resilience for a more restrained future. By scenario planning, diversifying markets and products, leveraging technology, and keeping a tight handle on working capital, you can turn this mixed trade outlook into strategic advantage.
If you’d like to keep up-to-date on trade-policy shifts, supply-chain best practices or export planning tools, explore our blog’s dedicated section on global trade insights.
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