Global trade hits record $33tr in 2024, growing by 3.7%: UNCTAD
According to the latest Global Trade Update from the UN Conference on Trade and Development, services drove growth, rising 9 percent for the year and adding $700 billion — nearly 60 percent of total exchange expansion.
Meanwhile, trade in goods grew 2 percent, contributing $500 billion.
'This positive momentum is expected to continue into Q1 (first quarter) 2025, building on a global trade value of nearly $33 trillion in 2024,' the report said.
UNCTAD's analysis highlighted a continued shift in global trade dynamics, with developing countries — particularly China and India — outperforming their developed counterparts.
While many advanced economies faced exchange contractions, emerging markets sustained momentum, bolstered by strong exports and domestic demand.
China's trade surplus expanded significantly in 2024, fueled by robust exports. Meanwhile, the US trade deficit widened, reflecting its growing reliance on imports. South-South trade, involving exchanges between developing economies, remained a key driver of global trade growth.
Services trade booms
Services trade outpaced goods trade in 2024, increasing by 9 percent and contributing approximately $700 billion to global exchange expansion. This sector's resilience contrasts with goods trade, which rose by just 2 percent, adding around $500 billion. The fourth quarter saw services trade maintain strong momentum, while goods trade growth decelerated.
Tariffs and trade barriers
Despite overall growth, UNCTAD warns of significant trade barriers. High tariffs continue to hinder market access for developing countries, particularly in agriculture and manufacturing.
'High import tariffs raise costs for businesses and consumers, potentially curbing growth and competitiveness,' the report said.
It added that tariff escalation — where higher duties are imposed on processed goods than raw materials — remains a major obstacle to industrialization in developing economies.
Agricultural exports from developing countries still face steep import duties, averaging nearly 20 percent under most-favored-nation treatment. Meanwhile, textile and apparel exports continue to be subjected to some of the highest tariff rates, limiting competitiveness.
Uncertainty clouds 2025
Looking ahead, UNCTAD warned that mounting geopolitical tensions, trade disputes, and protectionist policies could disrupt global exchange in 2025. The report identified several risk factors, including:
Shifts in trade policy: Increasing protectionist measures, such as new tariffs targeting specific industries, may reshape global supply chains.
Ongoing trade tensions: Major economies, including the US and China, continue to impose retaliatory tariffs, affecting global trade flows.
Subsidies and industrial policies: Governments are prioritizing national industries, particularly green energy and critical minerals, which could impact international trade relations.
Economic slowdown risks: Indicators such as declining demand for container shipping suggest potential trade contraction in the coming quarters.
However, the analysis also noted potential tailwinds, including China's planned economic stimulus and the expected easing of global inflation, which could support trade expansion.
Sectoral trade trends
Trade growth varied significantly across sectors in 2024. Office equipment and pharmaceuticals saw above-average growth, while the energy sector faced a sharp decline. In the third quarter, agri-food, communication equipment, and transport surged, whereas apparel and extractive industries weakened.
Global trade imbalances
The report highlighted growing trade imbalances, with the US maintaining the world's largest trade deficit and China recording the highest surplus. The EU, which ran a deficit in previous years, returned to surplus in 2024, aided by shifts in energy trade.
Bilateral trade imbalances, particularly between the US and China, remain significant, contributing to global economic uncertainty.
As global trade enters 2025, policymakers face the challenge of balancing growth with rising protectionism. UNCTAD emphasized the importance of multilateral cooperation and strategic trade policies to sustain momentum and navigate emerging risks.
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