Source: UNCTAD Global Trade Update | April 2026

Global trade in goods and services reached approximately $35 trillion in 2025, an increase of around $2.5 trillion, or nearly 7.5%, compared to 2024. Goods accounted for roughly $1.8 trillion of that rise, while services contributed around $700 billion. While the momentum carried into early 2026, warning signs are mounting across the global trading system.

Africa and East Asia: The Bright Spots

Trade growth was supported by developing economies in East Asia and Africa, alongside strong South–South trade. Africa posted export growth well above the global average in 2025, reinforcing the continent’s growing importance as a driver of global trade expansion — a trend with significant strategic implications for African businesses and policymakers.

The Rise of Connector Economies

In 2025, trade between the United States and China declined sharply, falling by roughly one-quarter, or about $170 billion. Despite this drop, overall trade for both economies continued to grow, with some of the missing bilateral trade redirected through “connector” economies whose trade with both the United States and China increased. Prominent examples include Egypt, Cambodia, Vietnam, and Thailand. This emerging dynamic presents new opportunities for strategically positioned African economies.

Sectoral Highlights

Manufacturing recorded a strong year, expanding by around 11%, driven by robust growth in machinery and electrical equipment. Agricultural trade also expanded, led by animal products, coffee, tea, and spices. By contrast, trade in natural resources declined, weighed down by lower prices for mineral fuels.

At the industry level, the electronics trade made 2025 a standout year, driven by surging demand for AI-related products, while wind energy and hybrid vehicles also showed strong growth. Fossil fuel trade declined sharply amid falling prices.

Risks on the Horizon: What to Watch in 2026

While trade growth remained solid in the first quarter of 2026, global trade is expected to slow for the remainder of the year. UNCTAD identifies six key headwinds:

1. Middle East Conflict & Strait of Hormuz Disruptions The ongoing conflict continues to disrupt energy flows, regional logistics, and broader geopolitical stability, representing the current primary global trade headwind.

2. US Trade Policy Uncertainty While the rollback of certain US tariffs provides limited relief, uncertainty remains high due to expanding Section 301 investigations that may result in new selective tariffs.

3. Geoeconomic Fragmentation Governments are increasingly deploying export controls, subsidy regimes, and non-tariff measures to boost strategic sectors’ actions that reduce predictability and increase compliance burdens for supply chains.

4. Slowing Services Trade Services trade growth has slowed in recent quarters, with tighter restrictions on cross-border data and digital services creating friction for IT and professional services.

5. Debt Pressures in Developing Economies Elevated public and private debt continues to constrain fiscal space, stifle investment, and weaken import demand across many developing nations.

6. Global Overcapacity Risks Industrial policies, combined with potentially weaker global demand, risk exacerbating oversupply in key sectors such as green and advanced manufacturing, potentially triggering defensive trade measures.

Reasons for Cautious Optimism

Despite the headwinds, several positive forces remain at work:

Rapid expansion in technology-intensive and green industries, including semiconductors, batteries, AI hardware, and clean-energy equipment, continues to drive global trade growth.

Trade among developing economies is expected to continue growing faster than the global average, reinforcing diversification and boosting regional trade resilience.

China’s expanded duty-free access for African exports and the potential renewal of the African Growth and Opportunity Act support preferential market access, while deepening regional agreements offer medium-term upside.

The Bottom Line

The outlook for the coming quarters points to slower global trade growth, with risks skewed to the downside compared with the robust performance observed in 2025. Rising energy costs, higher trade costs from tariffs, regulatory changes, and erosion of trade rules further dampen prospects.

For African economies, the message is clear: the window of opportunity created by US–China decoupling, South–South trade expansion, and Africa’s above-average export growth must be seized through deliberate policy, industrial coordination, and investment in trade-enabling infrastructure now, before global conditions tighten further.

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