UN Trade and Development said global economic growth is projected to slow to 2.6% in 2026, down from 2.9% in the previous year. The assessment, released on October 9, highlights the combined effect of weaker investment, financial instability, energy shocks and widening differences in access to technology.
Developing economies are expected to grow more quickly than advanced economies in aggregate, but UNCTAD warned that their expansion is losing momentum. Growth in developing countries is projected at about 4% in 2026, while many governments face higher borrowing costs, fragile currencies and limited fiscal room to respond to external shocks.
The report also points to a changing relationship between trade and technology. Artificial intelligence and digital systems are becoming increasingly important drivers of productivity, services exports and industrial competitiveness. Yet the gains remain concentrated among countries and companies with access to advanced computing, data, infrastructure, capital and technical skills.
That concentration has institutional consequences. Governments are reassessing industrial policy, data rules, digital taxation and the role of public investment in computing and connectivity. Companies are also deciding whether AI deployment will reduce costs, increase output or widen the gap between firms that can integrate new systems and those that cannot.
UNCTAD said global trade in goods and services is expected to expand by around 4% at constant prices in 2026, but trade growth alone does not guarantee broad-based development. Commodity exporters remain exposed to price volatility, while import-dependent economies can be hit by fuel and food shocks. Countries with narrow export bases face particular difficulty when demand shifts or supply chains are disrupted.
The report arrives as energy markets remain sensitive to conflict and shipping risk. Higher fuel costs can raise transportation bills, widen current-account deficits and intensify inflation in countries that lack domestic energy resources. UNCTAD has separately warned that vulnerable economies could face significant additional fuel-import costs during sustained oil shocks.
For financial institutions, the outlook reinforces the importance of distinguishing between headline growth and the quality of growth. A country may post positive expansion while household purchasing power, public investment and debt sustainability deteriorate. Currency pressure and refinancing needs could become more important than domestic output figures alone.
UNCTAD's central message is that the global economy is not simply slowing; it is becoming more uneven. The policy challenge is to ensure that digital transformation, trade and investment generate wider productive capacity rather than reinforcing a small group of technological leaders.
Sources: - https://unctad.org/news/global-growth-slows-26-and-gaps-widen-between-developing-regions - https://worldinvestmentforum.unctad.org/wif2026/news