Citi has launched the latest edition of its Global Perspectives & Solutions (Citi GPS) report titled: Supply Chain Financing – Durable Global Trade in the Age of AI. Its key findings show that global trade is undergoing a fundamental transformation, driven by tariff volatility, artificial intelligence adoption, and the continued shift toward multipolar, regionalized supply chains. Despite significant headwinds, businesses demonstrated remarkable resilience, adapting rapidly to policy shifts while maintaining strategic focus on diversification and working capital optimization.

The Middle East and Africa are emerging as a strategic crossroads in the new era of global trade, forging stronger connections with both Asia and Europe. The region has seen a dramatic 52 percent increase in shipments from North and East Asia, highlighting a significant pivot in trade flows. This growing importance is underscored by China's deepening relationships in the area, particularly with Saudi Arabia. The data suggests the region is successfully positioning itself as a vital and growing hub for international commerce and supply chains.

Key Supporting Data Points

  • Shipments from North and East Asia to the Middle East and Africa increased by 52 percent between 2019 and 2024 (Page 14).
  • Trade flows from the Middle East and Africa to Europe rose by 27 percent in the same period (Page 15).
  • China’s exports to the Middle East and Africa grew by 61 percent between 2019 and 2024 (Page 17).
  • Saudi Arabia leveraged its energy base to make fertilisers its third largest export growth category (Page 17).
  • Despite global trends, only 6 percent of suppliers in the Middle East view rising input costs as their most important challenge, suggesting different regional cost pressures (Page 97).

Adoniro Cestari, Global Head of Trade and Working Capital at Citi, said, "Technology is fundamentally reengineering how trade finance operates. AI-powered intelligent document processing enables exceptionally high accuracy rates and reducing processing to just minutes. Through a pilot of blockchain-based conditional trade payments, we have seen the potential for an evolution from standard paper-based guarantees to near 24/7 digital execution and automated settlement.” 

The report provides industry insights from Citi's proprietary Global Supply Chain Pressure Index, payment flows of the over $5 trillion its Services business processes daily, alongside survey responses from multinational corporations and small- and medium-sized enterprises (SMEs). While U.S. tariffs rose to approximately 16.8% from 2.4% before the change in US Administration, the Index shows supply chain pressures remained subdued and near pre-pandemic levels. Companies successfully navigated initial tariff shocks through strategic inventory management, supplier diversification, and accelerated nearshoring initiatives.

Analysis of goods reveals a complex reorganization of global trade. South Asia & ASEAN emerged as major winners, with a 44% increase in shipments from North & East Asia. Latin America has become deeply integrated into both Asia- and North America-linked supply chains, with exports to South Asia & ASEAN surging 82%, the single largest increase globally. The U.S. diversified its import base, with shipments from South Asia & ASEAN up 50% and from Latin America up 43%, both exceeding the 32% growth from North & East Asia.

The report examines how AI is creating a once-in-a-generation capital expenditure supercycle in data centers, with Citi Research estimating $7.75 trillion in global AI-related capex by 2030. Trade finance is playing an increasingly critical role in this ecosystem, with solutions ranging from supply chain finance to structured receivables programs supporting the complex, capital-intensive nature of AI data center development. AI adoption in trade finance accelerated dramatically, with 36% of large corporates now using AI tools – an 18% increase from the previous year.

“These types of innovations, combined with structuring expertise, helps companies unlock trapped liquidity and optimize working capital while supporting more efficient supply chains and the massive AI infrastructure buildout underway globally." Adoniro Cestari went on to say.

Working capital management has become a C-suite imperative, with 64% of companies citing increasing input costs as their primary concern. On average, 6.3% of working capital is now tied up in funding tariff costs. In response, companies are deploying inventory finance, structured receivables programs, and dynamic discounting to release trapped liquidity. Citi's survey of 710 large corporations revealed that 65% are actively diversifying supply chains away from one or more countries, with Vietnam, Thailand, India, and Mexico emerging as preferred destinations.