WTO raises global trade outlook, cites gains for Pakistan

The World Trade Organisation has significantly upgraded its forecast for global merchandise trade in 2026, saying Pakistan is among the countries that have benefited from trade disruptions linked to the ongoing Middle East conflict.

In its latest Global Trade Outlook Update, the WTO projected global merchandise trade volume to grow by 3.9% in 2026 and 4.1% in 2027. The estimates are considerably higher than its earlier forecasts of 1.9% and 2.6%.

The organisation said stronger-than-expected global trade was being supported by a surge in investment related to artificial intelligence and increased supplies of fuel and fertilisers from countries outside the Middle East.

Pakistan has benefited from the diversion of maritime traffic following disruptions around the Strait of Hormuz. The WTO said Pakistan’s sea freight transport exports increased by 73% year-on-year during the first half of 2026.

Container traffic also remained strong, with vessel calls at major Karachi terminals 14% higher than a year earlier in July.

Pakistan also recorded strong growth in computer services exports. According to the WTO, the country’s computer services exports increased by 23% in the second quarter, placing it among several emerging economies that saw rapid expansion in the sector.

However, the rerouting of ships and containers has also created capacity pressures across South Asian ports. Longer routes, waiting times and congestion have increased transportation costs, with some of these expenses potentially being passed on to consumers.

The WTO lowered its 2026 forecast for commercial services trade growth to 3.3% from an earlier estimate of 4.8%, mainly because the Middle East conflict has affected tourism and travel while increasing fuel costs.

The organisation expects global goods and services trade combined to expand by around 3.7% this year and 4.7% in 2027, although it warned that the outlook depends partly on a timely resolution of the Middle East conflict.

AI-related products accounted for a significant share of merchandise trade growth in the first half of 2026. The WTO said demand for advanced technology and data-centre equipment was helping offset the impact of reduced energy and fertiliser shipments.

The organisation nevertheless warned of risks from high energy prices, weaker household purchasing power and a possible slowdown in AI investment. It also noted that geopolitical tensions continue to influence global trade patterns, with US-China trade decoupling emerging as a major factor behind increasing trade divergence.