A new report from UN Trade and Development (UNCTAD) reveals that global trade expanded by approximately $500 billion in the first half of 2025, showcasing strong resilience despite persistent geopolitical tensions, policy volatility, and shifting trade dynamics.
The momentum of growth remained robust into the third quarter, driven primarily by manufacturing, a powerful rebound in services, and strong leadership from developing economies.
Strong Volume and Services Rebound:
Global trade in both goods and services recorded solid gains. Goods trade growth edged up to 2.5% quarter-over-quarter in the second quarter. Services trade, which had contracted earlier in the year, saw a significant rebound. UNCTAD’s nowcast for the third quarter anticipates continued expansion, with goods expected to grow by 2.5% and services accelerating sharply to around 4% quarter-over-quarter.
Manufacturing and High-Tech Drive Growth:
Manufacturing remains the central pillar of the current trade expansion, with the electronics sector leading the charge. Strong, sustained demand for hybrid and electric vehicles continued to bolster the automotive industry, reinforcing manufacturing’s critical role in global trade expansion.
Developing Economies Lead the Charge:
Growth in the second quarter was overwhelmingly driven by developing economies, supported by increasing South–South trade. Conversely, weak trade performance in the United States weighed on the global average. The report also noted a narrowing of global imbalances in goods trade, largely reflecting shifts in United States trade policy, even as trade deficits expanded in major economies like Japan, India, and the United Kingdom.
Prices Begin to Climb:
While the value rise in global trade during the first half of the year was mainly attributable to higher volumes, the report indicates that rising prices are beginning to contribute to growth. Prices for traded goods rose slightly in the second quarter, with preliminary estimates suggesting a marked increase in the third.
Barring major economic shocks in the final months of the year, global trade is on track to surpass its 2024 record.
However, UNCTAD cautioned that while global trade dynamics have so far shown limited disruption from shifting U.S. trade policy, uncertainty remains a key risk. Furthermore, persistent geopolitical conflicts continue to weigh on trade, heightening concerns over regional dynamics and energy and food security.
UNCTAD is the UN body responsible for dealing with development issues, particularly international trade, and the interlinkages with finance, technology, investment, and sustainable development.
