AI is accelerating trade in digitally delivered services
Artificial intelligence (AI) is set to further accelerate these trends by acting as a general purpose technology that reshapes how services are produced and traded internationally. AI is already enhancing digitally deliverable services such as finance, software, design, translation and data analytics, while also improving logistics, compliance and facilitation on digital trade platforms.
According to the WTO’s World Trade Report 2025, AI could raise global trade volumes by an estimated 34%–37% by 2040, driven by a combination of lower trade costs, productivity gains and the expansion of cross-border, AI‑enabled services. It’s also expected to deepen the tradability of services that are already digitally deliverable, thereby reinforcing the role of services as a key engine of global trade growth.
Within this broader context, cross‑border digital services trade is projected to grow rapidly over the next decade. WTO baseline assumptions point to around 20% growth in digitally delivered services by 2035, which would bring the global value of such trade to more than US$5 trillion (in current dollar terms).
This expansion reflects both rising demand for digitally enabled services and the increasing ability of firms to supply them across borders, as digital infrastructure and data‑driven technologies diffuse more widely. AI adoption is expected to be a central driver of this process, by lowering fixed costs of entry and enabling scale.
Some of these trends may already be playing out. The 2025 WTO-ICC (International Chamber of Commerce) business survey noted that 90% of AI‑adopting firms experience measurable trade improvements—such as faster customs processing, better market intelligence, or more efficient logistics. The survey also showed that 37% of micro, small and medium-sized enterprises expect AI tools to reduce communication costs by more than 50%, while another 24% expect major logistics savings. This highlights how smaller firms, with fewer resources, stand to gain from AI‑enabled efficiency.
Canada’s position in digitally delieverd services and potential growth paths
Since 2005, Canada’s exports of digital services have expanded at nearly four times the rate of its goods exports. However, Canada’s portion of global digital service exports has stayed below 3%, barely changing over the past 20 years. Meanwhile, economies of similar size, such as France, India, and the United Kingdom (U.K.), account for much higher shares of worldwide digital service exports than Canada.
Taken together, these trends point to a central paradox in Canada’s digital trade performance: Despite strong absolute growth, Canada hasn’t translated this momentum into a rising presence in global markets. Our stagnant market share suggests that growth has largely tracked global expansion rather than outpaced it, leaving Canada behind peers that have successfully scaled their digital services internationally.
This gap between growth and global positioning underscores the importance of assessing not just how fast Canada’s digital services exports are expanding, but how much unrealized potential remains. It’s in this context that a scenario‑based analysis becomes particularly useful for understanding what a stronger AI‑enabled digital services trajectory could mean for Canada’s future export performance.
Growth scenarios for Canada’s digital services exports
By leveraging digitally delivered service exports data from the WTO and incorporating two growth scenarios for Canada, our research team forecast two potential outcomes of Canada’s prospective digital service exports:
- Under the assumption that global digitally delivered services grow at 20% into 2035, our baseline scenario has Canada maintaining its average global market share over the past decade (2013-2023) of approximately 2.1%. In this case, Canada’s exports of digitally delivered services could reach roughly US$110 billion by 2035. This outcome would broadly align Canada’s performance with overall global trends, suggesting that maintaining competitiveness in digital services would be sufficient to secure moderate but steady export growth in a rapidly expanding AI-driven global market.
- An optimistic scenario highlights the potential upside from stronger positioning in AI‑enabled and digitally delivered services. If global digitally delivered services grow at 20%, and Canada were to increase its market share to around 3%—comparable to that of Switzerland’s average global market share over the past decade (2013-2023), a close peer in high‑value services exports—digitally delivered services exports could rise to about US$161 billion by 2035. This would imply growth of about 86% relative to 2023 levels. Realizing such an outcome would depend on Canada’s ability to leverage AI adoption, digital skills and data‑intensive capabilities, as well as on an external environment that supports open digital trade, cross‑border data flows and regulatory coherence.
The bottom line: AI expansion set to ignite global trade
Services—especially digitally delivered services—now sit at the core of global trade, and AI is set to dramatically accelerate their scale, scope and tradability. With digitally delivered services already accounting for more than half of global services exports, the coming AI‑enabled expansion represents a large and fast‑growing market. The key question isn’t whether digital services trade will grow, but whether countries, like Canada, can capture a meaningfully larger share of it.
This week, a very special thanks to Prerna Sharma, senior economist of our EDC economics department. As always, at EDC Economics, we value your feedback.
If you have ideas for topics that you’d like us to explore, please email us at economics@edc.ca and we’ll do our best to cover them.
