Developing economies have increased their share of world trade, becoming key players in global value chains. But rising emissions, persistent commodity dependence and growing public debt require urgent attention.
As UN Trade and Development (UNCTAD) celebrates its 60th anniversary, we delve into key trends that have shaped global trade and development over the past decades and will continue to influence them.
These trends include the increasing share of global trade by developing economies, the evolution of maritime trade, the rise of e-commerce, shifts in global emissions, the growing plastics trade, the persistence of commodity dependence, the surge in demand for critical minerals and the alarming rise in global public debt.
Developing economies have increased their share of global trade
Trade has grown significantly since UN Trade and Development's creation in 1964. Measured in current prices, which reflect inflation, trade in goods today is about 134 times greater than six decades ago. The integration of national economies into the global system has helped to drive this remarkable growth.
Importantly, developing countries have greatly increased their participation in global trade. For example, from 1964 to 2023 their share of world merchandise trade rose from 22% to 44%. While regional disparities persist and not all countries have benefited equally – the least developed countries’ share is under 1% – trade has generated unprecedented prosperity overall.
While tariffs have fallen, non-tariff measures have risen, creating new trade challenges for developing countries
The increase in developing countries' share of world trade has been driven by tariff liberalization since 1995, thanks to World Trade Organization agreements, bilateral and regional trade deals, and unilateral policies.
However, while tariffs have fallen, the rise of non-tariff measures (NTMs) poses new trade challenges. NTMs, such as quotas and safety and sanitary standards for food and medical products, are increasingly used by governments to protect public health and the environment.
Over the past decade, global tariffs have declined from 13% to 7%, while the frequency of NTMs has increased from 53% to 72%. The complexity of these measures and the higher compliance costs can be particularly challenging for businesses in developing countries, hindering their global competitiveness.
Goods are mostly carried by sea and increasingly in containers
Ships carry around 80% of trade in goods – from electronics to clothes to food. Since UN Trade and Development’s creation, the volume of seaborne trade has grown significantly. Between 1970 and 2021, cargo transported by ships increased from 2.6 billion tons to nearly 11 billion tons.
The invention of the standard shipping container revolutionized global trade, enabling seamless transport of goods across rail, road and sea. From 2010 to 2022, world container port throughput grew by 56%.
While bulk carriers and oil tankers still dominate in terms of carrying capacity, containers ships have gained prominence over the decades. Their share of the global carrying capacity has grown from 1.5% in 1980 to 14% in 2024.
Developing economies have increased their share of the goods unloaded from ships globally
While developing countries have long been major loading points for goods carried by sea, their share of the goods unloaded has climbed, surpassing 50% in 2011 and peaking at 61% in 2020.
This trend reflects their growing role as consumers in the global market. It also highlights their increased participation in global value chains since merchandise imports include semi-finished goods. However, this participation varies, with Asia, particularly China and neighboring East Asian economies, being the primary contributors.
Rapid-growing digital economy poses opportunities and challenges for developing countries
Technological advancements, widespread internet access and the proliferation of smartphones have fueled rapid growth in e-commerce. The latest estimates show that by 2022 e-commerce business sales in 43 developed and developing economies accounting for around three quarters of global GDP reached nearly $27 trillion, up 60% from 2016.
Trade in digitally deliverable services, including telecommunications and financial services, has also risen by 114% since 2010. Developing countries increased their share from 19% in 2010 to 24% by 2022.
For developing countries, the digital transformation offers vast potential for economic growth, job creation and poverty reduction. However, they face significant challenges to capitalize on these opportunities, such as high market concentration, inadequate laws and infrastructure, limited financial resources and a lack of digital skills.
Rising per capita emissions in developing countries highlight the need for more sustainable growth
While global GDP per capita has nearly tripled since 1960, CO2 emissions have quadrupled. The production and distribution of goods contribute to about a quarter of all emissions, posing a challenge for both developed and developing countries.
Over the decades, per-capita emissions have risen in lower-middle and upper-middle-income countries while falling in high-income ones. This highlights the urgent need to find more sustainable production and distribution methods while ensuring a just global energy transition that addresses both environmental and development goals.
The soaring trillion-dollar plastics trade offers emerging opportunities for substitutes
Global plastics trade has more than doubled from $535 billion in 2005 to $1.2 trillion in 2022. The world traded more than 382 million tons of plastics in 2021, enough to fill over 19 million trucks. With less than 10% of plastics recycled, most of these products end up polluting our environment.
Sustainable materials like bamboo, hemp, sand and algae offer eco-friendly alternatives and growing trade opportunities, especially for developing economies. In 2022, global trade in plastic substitutes was worth around $557 billion. About two thirds of global exports of plastic substitutes are in the form of raw materials, mostly from developing countries.
Commodity dependence persists in the developing world, underscoring the need for economic diversification
Many developing economies have historically relied on a few commodities, such as oil, copper, cacao and wheat, hindering their growth. A country is classified as “dependent” when commodities make up more than 60% of a its total merchandise exports.
From 1998 to 2021, the number of commodity-dependent countries increased from 92 to 101. In 2021, about 85% of the world's least developed countries were commodity-dependent, compared to only 12% of advanced economies. Overreliance on commodities makes countries vulnerable to price volatility and global shocks, such as drops in oil prices or climate change impacts.
The boom in critical energy transition minerals carries opportunities and risks for many developing countries
The climate emergency has led to a surge in demand for minerals critical to renewable energy technologies. UN Trade and Development (UNCTAD) projections based on data from the International Energy Agency indicate that by 2050, demand for lithium could rise by over 1,500%. Significant increases are also expected for nickel, cobalt and copper.
This demand presents opportunities for developing countries rich in these minerals, particularly in Africa, which holds large reserves. However, to benefit fully and avoid deepening commodity dependence, these countries must move up the value chain rather than merely supplying raw minerals.
Global public debt keeps rising, especially in developing countries
Global public debt surged to a historic peak of $97 trillion in 2023, growing by 90% since 2010. Currently, about 3.3 billion people live in countries that spend more on debt interest payments than on education or health.
This growth is marked by regional disparities, with public debt in developing countries rising at twice as fast as in developed countries. In 2023, developing countries' public debt reached $29 trillion. Their share of the global total climbed from 16% in 2010 to 30% in 2023, highlighting the need for urgent action.
Forward together navigating complex trends
The trends shaping trade and development highlight both progress and ongoing challenges.
Developing economies have made significant strides in global trade, becoming key players in global value chains and embracing digital transformation. However, issues like emissions, commodity dependence, and rising public debt require urgent attention.
As global dynamics evolve, UNCTAD remains committed to helping developing countries navigate these changes towards a more balanced and sustainable world.