WTO chief sees lasting impact on trade from Middle East war and geopolitics
SPY•WTO Director-General Ngozi Okonjo-Iweala said wars and geopolitical shifts are reshaping trade routes, with some changes likely to endure. The WTO forecast Middle East exports will fall 17% this year and imports about 15%, while global merchandise trade volume is projected to grow 3.9% in 2026.
1. Trade routes shift
Ngozi Okonjo-Iweala, director general of the World Trade Organization, said the wars in Ukraine and the Middle East and shifting geopolitics will have a lasting impact on global trade flows as companies prepare for future shocks. Trade in the Middle East has contracted sharply because of the Iran war, and the WTO forecast a 17% drop in exports this year and an approximately 15% decline in imports.
2. Diversification continues
Okonjo-Iweala said some alternative routes may remain in use even after the war ends and the Strait of Hormuz reopens, as businesses and governments seek to hedge against disruptions. She said repeated conflicts and US tariffs have prompted supply-chain reconfiguration, despite higher costs for some routes.
3. Regional trade outlook
She said regional trade is expected to expand, citing intra-African trade, which accounts for about 20% of African trade, compared with about 60% for trade within the European Union. The WTO last week raised its forecast for global merchandise trade volume growth to 3.9% in 2026 from a March baseline forecast of 1.9%, with demand for AI-related products helping offset disruption; Okonjo-Iweala said uncertainty remains over conflicts, tariffs and the AI boom.
