Global trade remains resilient despite geopolitical tensions

In April, the World Trade Organization raised its forecast for global trade growth and then revised the forecast upward from 2.6% to 2.7% in October due to the resilience of demand despite ongoing geopolitical challenges, which suggests the possibility of entering 2025, according to the World Economics platform. FORM International.
Trade is expected to recover, especially in sectors such as technology and energy.

Record level of global trade

A UN report released in December showed that global trade in 2024 is set to reach a record $33 trillion, $1 trillion more than in 2023, driven by 3.3% growth.
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Services trade, up 7%, fueled half of the expansion, while goods trade grew 2%, still below 2022 levels.

Geopolitical tensions

In light of this, geopolitical tensions remain the biggest risk to trade in 2025 alongside trade wars and potential shifts in US trade policies.
The expectation that global trade will reach $33 trillion in 2024, according to the latest statement published by the United Nations Trade and Development Organization (UNCTAD) in December, highlights, according to analysts, that the $1 trillion increase indicates resilience in global trade despite ongoing challenges and despite… Fears of recession and major decline.

Emerging and developed economies

Moreover, despite this activity for the year that is coming to an end, developing economies that have traditionally been strong drivers of global trade will face headwinds in 2024, with imports shrinking by 1% and South-South trade declining by the same margin in the third quarter.
In contrast, advanced economies led growth in the third quarter, as stable demand led to a rise in imports by 3% and exports by 2%.
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Despite these challenges, there are still opportunities for developing economies to benefit from high-growth sectors in 2025.

IT trade

ICT and apparel trade registered a sharp rise of 13% and 14% respectively in the third quarter of 2024 and this growth underscores the potential for diversification and entry into value-added industries.
Expectations of stable global growth and declining inflation also represent an opportunity to build greater resilience in 2025.
Trade pressures and growth prospects
While ICT and clothing showed strong momentum, traditional sectors vital to developing economies faced declines.
Energy trading fell by 2% during the quarter and 7% during the year while metals trading contracted by 3% on a quarterly and annual basis.
Auto trade fell 3% in the third quarter but is expected to end the year with modest growth of 4%.

A call to strategic action

UNCTAD urges developing economies to adopt targeted policies that promote the diversification of trade and investment in high-value sectors to mitigate risks.
The organization stresses that trade constitutes the cornerstone of sustainable development, and to benefit from the opportunities available in 2025, developing economies need coordinated support to overcome uncertainty and strengthen ties in the global market.

Trade relations between America and China

In May, the United States increased tariffs on Chinese exports including electric vehicle batteries and solar panels to address unfair trade practices and overproduction.
These changes reflect ongoing efforts to protect US industries, and as President-elect Trump returns to office, these tariffs may increase further, which will continue to impact US-China relations and global trade.