## Trade and Growth: Strained Resilience

## Source details

**Canonical URL:** [Trade and Growth: Strained Resilience](https://www.imf.org/annual-report/2026/in-focus/trade-and-growth-strained-resilience/)

## Other formats

- [Markdown version](/annual-report/2026/in-focus/trade-and-growth-strained-resilience/index.md)
- [Structured JSON version](/annual-report/2026/in-focus/trade-and-growth-strained-resilience/index.json)
- [Bundle manifest](/annual-report/2026/in-focus/trade-and-growth-strained-resilience/bundle-manifest.json)

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### Global trade environment and shocks
- Geopolitical tensions, changing trade relationships, and supply chain disruptions are reshaping global commerce, investment, and economic growth.
- The trade shocks of 2025 created headwinds to global growth and stoked inflation concerns.
- Trade volumes were up nearly 5 percent in 2025, with trade in technology-related goods continuing to grow briskly.
- The structural shift in US trade policy in early 2025 accelerated the reorientation of trade, most notably in Asia.
- Many economies negotiated bilateral trade understandings with the US and pursued trade opportunities and agreements with each other and within regions, based on existing trade rules and systems.
- Trade growth is expected to slow in the current year, exacerbated by the shock emanating from the war in the Middle East.

### War in the Middle East and energy supply impacts
- According to the International Energy Agency (IEA), the war—and subsequent closure of the Strait of Hormuz—caused the largest ever cut to global energy supplies.
- The war has led to knock-on effects on other commodities, food supplies, and broader supply chains.
- Enduring damage to energy export infrastructure in the region could continue to limit supply.
- Uncertainty and the need to build supply chains that are more resilient, but less efficient, heavily influence trade and investment decisions.
- Recovery is hampered by global trade barriers that remain much higher than they have been for decades.

### IMF analysis of imbalances and vulnerabilities
- IMF analysis shows how excessive imbalances increase vulnerability to economic shocks and financial instability, raising the risk of sudden sharp corrections.
- High external and domestic imbalances are identified as a pressing global risk to be addressed alongside efforts to diversify and deepen trade and sources of supply.

### IMF advice and policy recommendations
- The IMF is providing tailored country and multilateral advice and encouraging countries to cooperate and scale back impediments to international commerce.
- Predictable, transparent, and well-communicated trade policy frameworks help reduce uncertainty and anchor business and consumer expectations.
- The IMF has advised regions to be agile in looking for further opportunities to advance trade, including through multilateral and plurilateral negotiations.
- The IMF is providing deeper analysis of how to address today’s high global imbalances and their negative spillovers while stimulating growth.

### Country-specific guidance and regional integration
- For external surplus countries such as China:
  - Continued progress toward consumption-led growth can improve welfare and narrow trade and current account surpluses.
- For external deficit countries such as the US:
  - Credible fiscal consolidation could reduce demand for imports and external financing.
- At the regional level:
  - Further integration within groups such as the Association of Southeast Asian Nations (ASEAN) can support resilience.
  - Deepening the European Union’s single market and enacting reforms to stimulate private investment will support more resilient and sustainable growth.

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## Content in this bundle

- **Appendices**
  - [Appendices (Markdown version)](/annual-report/2026/pdfs/imf-annual-report-2026-appendices.pdf.md){rel="alternate" type="text/markdown"}
  - [Appendices (PDF)](/annual-report/2026/pdfs/imf-annual-report-2026-appendices.pdf){rel="external" type="application/pdf"}
- **Web Tables**
  - [Web Tables (Markdown version)](/annual-report/2026/pdfs/imf-annual-report-2026-web-tables.pdf.md){rel="alternate" type="text/markdown"}
  - [Web Tables (PDF)](/annual-report/2026/pdfs/imf-annual-report-2026-web-tables.pdf){rel="external" type="application/pdf"}

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## References

- [see In Focus on AI).](https://www.imf.org/annual-report/2026/in-focus/ai-deployment-and-disruption/)
- [IMF analysis](https://www.imf.org/en/publications/policy-papers/issues/2026/04/06/understanding-global-imbalances-575234)

_Source: https://www.imf.org/annual-report/2026/in-focus/trade-and-growth-strained-resilience/_