A resurgence of global economic activity has lifted merchandise trade above its pre-pandemic peak, the World Trade Organization (WTO) said on Monday, as it revised up its 2021 and 2022 trade forecasts. 

"The WTO is now predicting global merchandise trade volume growth of 10.8 percent in 2021 - up from 8.0 percent forecast in March - followed by a 4.7 percent rise in 2022," the global trade body said. This is up from 4.0 percent previously.

The strong annual growth rate for merchandise trade in 2021 is mainly due to the collapse in 2020, when trade bottomed out in the second quarter.

The rate of growth is expected to moderate as merchandise trade returns to the long-term trend it was on before the COVID-19 crisis struck.

Supply-side issues such as semiconductor scarcity and port backlogs may strain supply chains, but are unlikely to have large impacts on global aggregates, WTO experts said.

They said the biggest downside risks came from the pandemic itself.

"Trade has been a critical tool in combating the pandemic, and this strong growth underscores how important trade will be in underpinning the global economic recovery," said WTO director-general, Ngozi Okonjo-Iweala.