UNCTAD Projects Global Growth Slowdown to 2.6 Percent

The United Nations Conference on Trade and Development projects global economic growth will slow to 2.6% in 2026, a decrease from 2.9% the previous year. The agency attributes this deceleration to energy shocks stemming from the crisis in the Middle East. While global trade in goods and services is expected to expand by 4%, this rise is largely driven by higher energy prices. Asia is expected to be the primary engine of growth, contributing 59% of the global total, with India projected to expand by 7.3%.

Other international bodies offer varying outlooks. The International Monetary Fund projects 3% growth, while the World Bank forecast 2.5% in June. Simultaneously, the World Trade Organization raised its growth forecasts for global trade in goods to 3.9% this year and 4.1% next year, citing an investment boom in artificial intelligence centered in the United States. The World Trade Organization noted that if these trends continue, trade volumes in 2027 will be more than 12% higher than 2024 levels.

Despite these gains, systemic risks persist. The United Nations Conference on Trade and Development warned that the AI boom creates financial stability risks due to market concentration and noted that trade between China and the United States has fallen by more than 20% since 2024. Additionally, the World Trade Organization expects trade in services to grow more slowly than anticipated due to the ongoing war between the United States and Iran.