By Paul Hannon
Global trade in goods will increase more rapidly than previously expected this year as purchases of goods related to artificial intelligence surge and a buildup in inventories in the U.S. softens the impact of higher tariffs, the World Trade Organization said Tuesday.
However, the Geneva-based dispute resolution body expects exports and imports of goods to grow at a slower pace in 2026 as the tariff rises implemented by the U.S. and in retaliating countries take full effect.
The WTO now forecasts that global trade will increase by 2.4% in 2025, having expected to see a 0.9% rise as recently as August, and a 0.2% decline in April. Growth is now forecast to be much closer to the 3% projected before the U.S. presidential election than in the immediate aftermath of President Trump's first tariff announcements.
Trade has been more resilient than many economists expected in large part because U.S. businesses imported large quantities of goods in the early months of the year in order to avoid paying the higher tariffs on imports that were expected later in 2025.
But the WTO said the modest nature of retaliation by other governments to the higher U.S. duties had also helped, as did a jump in trade in AI-related products.
"Countries' measured response to tariff changes in general, the growth potential of AI, as well as increased trade among the rest of the world helped ease trade setbacks in 2025," said Ngozi Okonjo-Iweala, the WTO's director-general.
The WTO calculates that trade in 100 product lines related to AI that range from semiconductors and processors to finished computers, servers and telecommunications equipment jumped by 20% in the first six months of this year compared to the same period in 2024. As a result, AI-related products were responsible for 42% of trade growth, although they account for just 15% of total trade.
""The new trade data are just the latest sign that AI is no longer an emerging issue on the horizon, it has arrived with very important implications for trade," said Okonjo-Iweala.
It said the U.S. "stood out," with imports of semiconductors alone surging by 36%, while purchases of servers and automatic data processing machines grew by 10%.
"This reflects firms expanding inventories ahead of tariff increases and at the same time investing in cloud and data centre capacity," the WTO said.
The WTO's upgrades follow the release of new forecasts from the Organization for Economic Cooperation and Development, which last month said it expects the global economy to expand by 3.2% this year, stronger than the 2.9% projected in June.
But while 2025 may prove to be a stronger year for trade and broader economic activity than many economists had expected when Trump began to announce big rises in tariffs, the outlook for next year is less rosy.
The WTO lowered its forecast for trade growth in 2026 to 0.5% from the 1.8% seen in August, as businesses will find it harder to escape higher tariffs as they become more widespread, and the inventories they built up earlier this year are exhausted.
"The tariffs still have a significant effect, it is just the timing that has changed" said Marc Bacchetta, acting head of economic research.
However, taking 2025 and 2026 together, expected trade flows remain higher than they were in April.
"The tariff impact has shifted into 2026, with the slight improvement reflecting that some inventory build up in early 2025, particularly of durable goods, will not be fully reversed in 2026," the WTO said.
The WTO's economists warned that trade flows could be even weaker in 2026 if large economies outside the U.S. were to impose higher tariffs on each other. Okonjo-Iweala warned members of the WTO against following that path.
"Complacency is not an option," she said. "Today's disruptions to the global trade system are a call to action for nations to reimagine trade and together lay a stronger foundation that delivers greater prosperity for people everywhere."
The WTO's economists also said trade flows could be stronger than forecast if the surge in trade in AI-related goods were to be sustained.
Write to Paul Hannon at paul.hannon@wsj.com
(END) Dow Jones Newswires
October 07, 2025 09:18 ET (13:18 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.