In its July 2025 Global Trade Update, the United Nations Conference on Trade and Development (UNCTAD) reported that global trade showed unexpected resilience in the first half of the year. This occurred despite significant headwinds stemming from policy uncertainty and geopolitical tensions.
According to the report, trade expanded by approximately $300 billion during this period. Goods accounted for $230 billion while services contributed $70 billion. Although modest, this growth marks a recovery from the sluggish performance observed in late 2024.
UNCTAD notes that the first quarter of 2025 saw a 1.5% increase in global trade, followed by a projected 2% rise in the second quarter. These figures suggest a steady and cautious rebound in global economic activity. The resilience is attributed to factors such as easing inflation in major economies, improvements in logistics and supply chains, and a resurgence in consumer demand, particularly in developed markets.
One of the more notable shifts in the trade landscape is the renewed dominance of developed economies. The United States recorded a 14% surge in imports, driven by strong domestic consumption and inventory restocking. The European Union experienced a 6% increase in exports, supported by demand for industrial goods and green technologies. This trend contrasts with recent years when developing economies had been the primary drivers of trade growth. While the Global South remains essential for long-term expansion, short-term momentum has clearly shifted toward more mature markets.
Growing trade imbalances feature prominently in the report. The United States trade deficit widened further, while China and the European Union posted increasing surpluses. These imbalances have been building over the past year and could pose risks to global financial stability if not addressed. UNCTAD warns that such disparities may fuel tensions between major trading blocs, especially in the context of ongoing disputes over tariffs, subsidies, and digital trade regulations.
The report also highlights that market concentration among digital multinational enterprises has intensified. The top five firms now account for 48% of global digital sales, which is more than double their share in 2017. This consolidation raises concerns about competition, innovation, and consumer welfare. UNCTAD calls for stronger enforcement of competition laws, particularly in emerging markets, and urges governments to invest in digital infrastructure to ensure a more inclusive digital trade environment.
Looking ahead, UNCTAD remains cautious about the second half of 2025. Geopolitical tensions, including conflicts in Eastern Europe and trade disputes in Asia, continue to cast uncertainty over global markets. Additionally, shifts in monetary policy across major economies could affect exchange rates and capital flows, further complicating trade dynamics.
Despite these challenges, the report underscores the adaptability of global trade systems and the potential for innovation-driven growth. The expansion of digital services, the greening of supply chains, and the rise of new trade corridors in regions such as Africa and Southeast Asia offer promising avenues for diversification and resilience. UNCTAD emphasizes that inclusive trade policies, investment in infrastructure, and regional cooperation will be key to sustaining momentum.
The report also calls attention to the importance of multilateralism in navigating future uncertainties. As trade becomes increasingly intertwined with technology, climate policy, and security concerns, coordinated global action will be essential. UNCTAD urges governments to engage constructively in international forums and to prioritize long-term stability over short-term protectionism.
In summary, while the first half of 2025 has demonstrated that global trade can withstand considerable pressure, the path ahead remains complex. The choices made by policymakers, businesses, and international institutions in the coming months will shape not only the trajectory of trade but also the broader contours of global economic recovery.
