Key facts
- Global economic growth is projected to slow to 2.6% in 2026.
- Trade in goods and services is expected to expand by 4% in 2026.
- Asia is projected to contribute 59% of global economic growth in 2026.
- India is projected to expand at 7.3% in 2026.
- China is projected to expand at 4.5% in 2026.
- Indonesia is projected to expand at 5.2% in 2026.
Global economic growth is expected to slow to 2.6% in 2026, a decrease from 2.9% in the previous year, according to the United Nations Conference on Trade and Development (UNCTAD). The agency cited the energy shock from the Middle East crisis, export controls, investment screening, and supply-chain conditions as factors testing the global economy.
UNCTAD's trade and development report projects that trade in goods and services will expand by 4% in constant prices, following a record global trade volume of $35 trillion in 2025. However, this projected rise is largely attributed to higher energy prices.
Trade between China and the US has declined by over 20% since 2024, while East Asia has increased its trade with both China and North America. The report also highlighted that while AI products like semiconductors are driving merchandise trade, growth in AI-related trade does not automatically translate to broad development gains.
Furthermore, UNCTAD warned of financial stability risks associated with the AI boom, as markets become increasingly concentrated in a few companies. The World Bank had previously lowered its global growth forecast to 2.5% in June, citing the Middle East war, and projected a potential decline to 1.3% in a worst-case scenario. The International Monetary Fund (IMF) offered a slightly more optimistic outlook with a 3% growth forecast but also flagged risks from the Iran war, trade fragmentation, and AI-related market corrections.