Global commerce witnesses a boom during the first half of 2025, according to the World Trade Organization, yet the specter of tariffs threatens the trade landscape in 2026.
The global economy is bracing for a slowdown in merchandise trade growth, with the World Trade Organization (WTO) revising its 2026 forecast to 1.8%, a decrease from the previous 2.5%. This downward revision is largely due to the impact of recent tariff hikes and ongoing trade tensions [1][3].
In 2025, despite the introduction of higher tariffs, global merchandise trade is still forecast to grow by 0.9%. This growth is partly due to a frontloading effect where US importers accelerated purchases to beat the tariffs, temporarily boosting trade volume in early 2025 [1][2][4]. However, this surge is expected to be followed by a slowdown in the second half of 2025 and into 2026.
The WTO Director-General Ngozi Okonjo-Iweala noted that the full impact of recent tariff measures is still emerging and that uncertainty remains a disruptive force for business confidence, investment, and supply chains [1].
The US-China trade truce and exemptions for certain goods have lessened the impact of new tariffs, but higher reciprocal tariff rates introduced on August 7 are expected to increasingly constrain trade [3]. The US tariffs imposed in 2025 are the highest average rates since 1933, with significant impacts on consumer prices and trade dynamics [3][5].
Economies reliant on energy exports are forecast to see their contribution shrink in 2026 as lower oil prices reduce revenues and dampen demand. The Turkish central bank estimated the average price of Brent crude at $65.7 per barrel for 2025, but as of Friday's close, Brent crude was priced at $66.32 per barrel [6].
North America's imports are now expected to fall by 8.3% in 2025, a smaller drop than the 9.6% decline previously projected [4]. U.S. import volumes rose 11% year-on-year in the first half of 2025, with a sharp 14% quarter-on-quarter increase in the first quarter followed by a 16% decline in the second quarter [4].
Asia is expected to remain the largest positive driver of global trade growth in 2025, with exports from the region projected to increase 4.9% [1][2]. Europe's trade contribution has weakened, with exports expected to fall 0.9% and imports to grow just 0.4% this year [1].
Turkiye's energy-excluded current account posted a $36.4 billion surplus on an annual basis as of May [7]. The Turkish central bank stated that lower oil prices would help narrow the current account gap and ease inflation [7].
In summary, tariff hikes have caused a temporary frontloading surge in trade in early 2025 but are expected to restrain global merchandise trade growth to around 1.8% in 2026, reflecting a slowdown compared to previous forecasts and increased economic uncertainty [1][2][3][4][5]. This slowdown is particularly noticeable in the US and European markets, while Asia continues to be a bright spot in the global trade landscape.
[1] World Trade Organization (WTO) press release, 2025 [2] International Monetary Fund (IMF) World Economic Outlook report, 2025 [3] US Trade Representative press release, 2025 [4] US Census Bureau data, 2025 [5] Federal Reserve Bank of New York report, 2025 [6] Oil Price Information Service, 2025 [7] Central Bank of the Republic of Turkey press release, 2025
- The Turkish central bank anticipates that lower oil prices, as reported by the Oil Price Information Service, will help reduce the current account gap and eventually ease inflation in Turkiye.
- Despite the global economy's bracing for a trade growth slowdown, as stated in the World Trade Organization (WTO) press release, Turkiye's energy-excluded current account posted a significant surplus of $36.4 billion as of May.
- According to the Federal Reserve Bank of New York report, the US tariffs imposed in 2025 are the highest average rates since 1933, resulting in significant inflation concerns for the finance and business sectors.
- The Turkish government recognizes the impact of inflation on the economy, making policy-and-legislation changes a priority in addressing this issue, which is a critical part of the general news cycle.
