Global trade is undergoing a structural transformation driven by tariff volatility, the rapid adoption of artificial intelligence and the rise of more regionalised supply chains, according to a new report by Citigroup Inc..
The bank’s latest Global Perspectives & Solutions (Citi GPS) study, Supply Chain Financing – Durable Global Trade in the Age of AI, says companies have shown notable resilience despite policy uncertainty and rising costs. Businesses have adapted through supplier diversification, inventory management and tighter working capital controls.
Adoniro Cestari, Citi’s Global Head of Trade and Working Capital, said technology is “fundamentally reengineering” trade finance. He highlighted advances such as AI-powered document processing, which can cut processing times to minutes, and blockchain-based conditional payments that could enable near round-the-clock digital settlement.
The report draws on Citi’s proprietary Global Supply Chain Pressure Index, payment flows from the bank’s Services business—processing more than $5 trillion daily—and surveys of multinational firms and small and medium-sized enterprises. It found that although US tariffs rose sharply to about 16.8%, supply chain pressures have remained close to pre-pandemic levels.
Trade patterns are also shifting. South Asia and ASEAN have emerged as major beneficiaries, with shipments from North and East Asia rising 44%. Latin America is becoming more deeply integrated into Asia- and North America-linked supply chains, with exports to South Asia and ASEAN jumping 82%.
Citi estimates that AI is driving a once-in-a-generation capital expenditure cycle in data centres, projecting $7.75 trillion in global AI-related investment by 2030. Adoption of AI in trade finance is accelerating, with 36% of large corporates now using AI tools—up 18 percentage points year on year.
Working capital pressures remain acute, however. Nearly two-thirds of companies cited rising input costs as their top concern, while an average 6.3% of working capital is now tied up in tariff expenses.
