- October 15, 2025
- Posted by: AITCR 3
- Categories: News, Economics, Blog, Report
Introduction
The World Trade Organisation (WTO) Annual Report 2025 provides a comprehensive overview of global trade developments and the organisation’s activities throughout 2024 and the early part of 2025. Against a backdrop of mounting geopolitical tensions, policy uncertainty, and evolving economic challenges, the report examines both the resilience of the multilateral trading system and the pressing need for reform and adaptation. As the WTO celebrates 30 years since the Marrakesh Agreement established the organisation, this report underscores trade’s critical role in raising living standards while acknowledging that benefits have not reached all segments of society equally.
Key Findings
Trade Performance and Forecasts
Merchandise Trade: In 2024, world merchandise trade volume grew by 2.9%, surpassing world GDP growth (2.8%) for the first time since 2017, excluding the pandemic rebound. However, rising tariffs and trade policy uncertainty prompted the WTO to downgrade its 2025 forecast to a -0.2% contraction. The trade covered by new restrictions surged to US$888 billion—half a trillion dollars more than the previous period, signalling an alarming trend toward protectionism.
Services Trade: Commercial services trade demonstrated strong growth, increasing by 9% in value terms in 2024, with all major sectors contributing. Digitally delivered services reached US$4.64 trillion, now accounting for 14.5% of world exports of goods and services.
Ministerial Outcomes and Negotiations
The 13th Ministerial Conference (MC13) in Abu Dhabi brought together nearly 4,000 delegates and resulted in ten multilaterally agreed decisions and declarations. Key outcomes included:
- New Members: Comoros and Timor-Leste became the 165th and 166th WTO members, marking the first membership expansion since 2016
- Development Focus: Ministers adopted a declaration on improving special and differential treatment (S&DT) for developing economies and least-developed countries (LDCs)
- Services Regulation: New disciplines on services domestic regulation entered into force, expected to lower trade costs by over US$125 billion annually
- Investment Facilitation: 123 members finalised the Investment Facilitation for Development (IFD) Agreement, though consensus on incorporation into the WTO framework remains elusive
Despite intensive negotiations, members could not reach a consensus on agriculture reform or conclude the “second wave” of fisheries subsidies negotiations.
Fisheries Subsidies Progress
By mid-July 2025, 106 WTO members had accepted the Agreement on Fisheries Subsidies, representing more than 95% of the required two-thirds threshold for entry into force. The WTO Fish Fund has approved a 2025 budget and work plan to support eligible developing economies in implementing their obligations once the Agreement takes effect.
Development and Capacity Building
Aid for Trade: Following pandemic-related declines, Aid for Trade disbursements reached a record high of over US$50 billion in 2022. Since 2006, US$648 billion has been invested to help developing economies participate more fully in global trade.
LDC Participation: LDCs’ share in world trade has nearly doubled since the WTO’s launch, from 0.59% in 1995 to 1.17% in 2023. The Enhanced Integrated Framework (EIF) concluded its second phase after implementing 175 projects in 49 countries with US$143.56 million in contributions.
Technical Assistance: Approximately 7,000 participants benefited from trainer-led technical assistance in 2024, while over 10,600 completed e-Learning courses, a 14% increase. Africa accounted for 42% of total participation.
Trade Policy Concerns
The Trade Policy Review Body examined 14 members’ trade policies in 2024, with members raising concerns about:
- Relatively higher tariff protection for agricultural products
- Use of non-tariff measures, including non-automatic licensing and temporary prohibitions
- Potentially trade-distorting subsidy schemes
- Environmental policies and their implementation
Trade remedy investigations increased significantly, with anti-dumping initiations jumping to 169 in the first half of 2024 from 77 in the same period of 2023.
Dispute Settlement
WTO members filed ten requests for consultations in 2024, up from six in 2023. Five panel reports were circulated, and three were adopted. However, the Appellate Body remains unable to hear appeals due to vacant positions and the ongoing lack of consensus on launching a selection process. Efforts continue on dispute settlement reform, with members producing draft texts on several issues under discussion, though the 2024 deadline was not met.
Digital Trade and E-commerce
Seventy-one WTO members finalised the text of the e-commerce agreement after five years of negotiations, establishing the first-ever set of global baseline rules on e-commerce. The agreement awaits incorporation into the WTO legal framework. Meanwhile, the Work Programme on Electronic Commerce was reinvigorated at MC13, with the moratorium on customs duties on electronic transmissions extended until MC14 in March 2026.
Recommendations
1. Accelerate Agricultural Reform
The persistent deadlock in agriculture negotiations, particularly on public stockholding for food security, requires fresh approaches. The proposed hybrid process involving group configurations and facilitator-led discussions should be pursued urgently. Members must demonstrate political will to make necessary trade-offs, as agriculture affects billions of people globally. Early progress in 2025 would allow more focused ministerial discussions at MC14.
2. Conclude Fisheries Subsidies Negotiations
With 95% of required ratifications achieved for the 2022 Agreement and broad support for additional provisions on overcapacity and overfishing, the remaining holdout members should reconsider their positions. The revised draft text from late 2024 merits serious consideration to break the current stalemate and deliver comprehensive disciplines that protect global fish stocks and fishing-dependent communities.
3. Strengthen Dispute Settlement System
Build on the “significant progress” noted in December 2024 to finalise reforms by MC14. The near-final draft chapter on capacity building and technical assistance should be adopted, while members must find a compromise on the contentious appeal/review mechanism. The proliferation of disputes (631 initiated since 1995) and increasing use of trade remedy measures underscore the urgent need for a fully functioning system accessible to all members.
4. Enhance Aid for Trade Effectiveness
While Aid for Trade reached record levels, the study “Aid for Trade in a Changing Global Context” highlights the need for:
- Greater focus on trade policy and regulations (currently only 2% of funding)
- Increased ownership by both beneficiaries and donors
- Better alignment with WTO work through discussion of best practices and lessons learned
- More coordination between Aid for Trade and complementary domestic policies in education, infrastructure, and labour markets
Addressing the concerning decline in Global Trust Fund contributions is critical for sustaining technical assistance activities.
5. Integrate Plurilateral Agreements
The Investment Facilitation for Development Agreement (backed by 126 members representing three-quarters of the membership) and the e-commerce agreement (supported by 71 members) should be incorporated into the WTO framework. Members with reservations should engage constructively to address concerns, recognising that these agreements modernise the rulebook without binding non-participants and could unlock significant economic growth, particularly for developing economies.
6. Address Trade Restrictive Measures
The surge in trade-restrictive measures, with coverage increasing from US$337 billion to US$888 billion, demands immediate attention. Members should:
- Roll back existing restrictions rather than allowing stockpiles to accumulate
- Ensure transparency through timely notifications
- Prioritise the least trade-distortive measures when addressing legitimate policy concerns
- Strengthen multilateral cooperation to prevent fragmentation along geopolitical lines
The WTO Secretariat’s enhanced monitoring and transparency tools should be fully utilised.
7. Advance Development and Inclusiveness
Implement the MC13 decisions on S&DT for developing economies and LDCs, with particular focus on:
- The three-year transition period for graduating LDCs
- Enhanced technical assistance in SPS and TBT areas
- Support for LDCs’ participation in digital trade through the “Digital Trade for Africa” project
- Implementation of the Women Exporters in the Digital Economy (WEIDE) Fund to empower women entrepreneurs
The retreat on “Trade as a Tool for Development” should translate into concrete actions leading to MC14.
8. Leverage Technology and Digital Transformation
Continue advancing the Secretariat’s digital transformation initiatives, including:
- Expanding AI applications while maintaining appropriate safeguards
- Rolling out new platforms for notifications, trade data, and services statistics
- Enhancing cybersecurity measures
- Implementing knowledge management tools to preserve institutional expertise
- Supporting members in addressing the digital divide through capacity building
The new Global Services Trade Data Hub and enhanced trade data platforms demonstrate the value of improved digital tools.
9. Prepare for MC14 with Clear Priorities
Use the first part of 2025 to make progress in multiple areas so ministers can focus on agriculture and other critical unresolved issues at MC14. Specific targets include:
- Finalising fisheries subsidies, additional provisions
- Achieving consensus on IFDA incorporation
- Delivering meaningful dispute settlement reform
- Making substantive progress on development issues
- Advancing e-commerce work programme recommendations
This phased approach would ensure a manageable and productive ministerial agenda.
10. Strengthen Multilateral Cooperation
In an era of rising geopolitical tensions and policy uncertainty, reinforce the WTO’s role as:
- A forum for dialogue on trade concerns among all 166 members
- A provider of stability through rules-based trade (with MFN terms underpinning 74% of global merchandise trade)
- A platform for addressing shared challenges, including climate change, pandemic preparedness, and food security
- A coordinator with other international organisations on cross-cutting issues
The WTO Secretariat Strategy 2030, with its focus on excellent service, knowledge hub, global platform, engaged partner, and forward-looking organisation, provides a roadmap for enhanced institutional effectiveness.
Conclusion
The WTO Annual Report 2025 presents a sobering assessment of the multilateral trading system at a critical juncture. While trade demonstrated remarkable resilience in 2024 with merchandise trade volume growth of 2.9% and services trade increasing by 9%, the dramatic downgrade of the 2025 forecast to -0.2% contraction underscores the fragility of this resilience amid escalating trade tensions and policy uncertainty.
Director-General Ngozi Okonjo-Iweala’s observation that the global trading system is experiencing “its worst disruptions since the Second World War” is not mere rhetoric but a call to action. The surge in trade-restrictive measures, the stalling of key negotiations on agriculture and fisheries subsidies, and the continuing impasse on dispute settlement reform all point to a system under strain.
Reference
World Trade Organisation. (2025). Annual Report 2025. Geneva: WTO Publications. Retrieved from www.wto.org
