On September 15, the World Trade Organization (WTO) released its annual World Trade Report, warning that global trade fragmentation triggered by geopolitical tensions and a breakout in restrictive policies is slowing growth, stability of multilateral trading system, and international trade compliance.
WTO’s report highlighted a heightened activity in trade-distorting measures – nearly doubled since the pre-pandemic era – disproportionately impacting developing economies and threatening to reduce global gross domestic product (GDP) by billions of dollars.
The report stresses that AI’s impact won’t be automatic. The benefit of this transformation will depend on whether governments can address factors affecting international trade like digital divides, education gaps, and maintain open and free trade rules.
Without these measures, AI might reinforce inequalities rather than reduce them.
The Outlook for Growth in Global Trade Appears to Be Ominous
According to the WTO estimations, AI would raise world trade by 34–37% and increase global GDP by 12–13% by 2040, depending on the speed of adaptation by economies.
If lower- and middle-income nations can reduce their digital infrastructure gap with wealthier countries by 50% and implement AI more extensively, their incomes will rise by 15%.
“AI has vast potential to lower trade costs and boost productivity. However, access to AI technologies and the capacity to participate in digital trade remains highly uneven,” said WTO Director-General.
International trade logistics will play a big role in this growth, through AI reshaping supply chains and streamlining cross-border operations. The WTO estimates that trade in AI-enabling goods, such as semiconductors and digital components, reached $2.3 trillion in 2023. It argues that trade will play a significant channel for disseminating these technologies more extensively, allowing less-developed economies to access AI-driven growth.
Fair Access to Technology, AI
Challenges in changing the international trade course do exist, as highlighted in the report, quantitative indices have grown exponentially, from 130 in 2012 to nearly 500 in 2024, most of the indices being from high and upper middle-income economies.
Tariffs on products for enabling AI for some low-income countries are as much as 45%, making it more expensive to access the digital economy.
“With the right mix of trade, investment and complementary policies, AI can create new growth opportunities in all economies. With the right frameworks, trade can play a central role in making AI work for all. The WTO is committed to supporting this effort,” DG Okonjo-Iweala said.
The WTO notes that countries’ different types of international trade practices transform how inclusive AI adoption will be. Without them, inequality within countries could increase, particularly if the new opportunities accrue primarily to only a minority sector of the population.
Additionally, the policy and theory of international trade will need updating to reflect the role of AI. Broader participation in agreements like the Information Technology Agreement could help make technologies more accessible.
A Technological Lens on Trade
While the report focuses on rules and international trade compliance, a deeper question arises: what of AI change the definition of trade itself? Already, algorithms manage supply chains, predict demand, and even negotiate contracts.
This point of view could shift global markets toward international specialization and trade, where countries exchange AI driven intelligence, not only goods.
Experts argue that the drawbacks of international trade due to Trump’s tariffs are proof of how fragile access to technology can be when politics intervene. Supposedly the next wave of globalization centers on algorithms instead of goods, then politics will need to count for the risks of inequality.
As international economic organizations try to help the global economy by coordinating trade rules, the challenge remains in acquiring balance in access to advanced technologies with fair competition. The history of globalization and economic inequality shows that unchecked growth often leaves smaller economies behind.
Ultimately, international trade most often takes place because of differences in resources and specialization. However, in an AI-powered future, who controls the data and algorithms matters. Therefore, global trade could move beyond containers and cargo ships, toward a marketplace where intelligence is the most valuable export.
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