Money and business

"Unkad" Developing countries warn against relying on basic commodities to correct their economic path

Geneva on July 22 / WAM / The United Nations Trade and Development Organization (UNCTAD) has warned developing countries against relying on deep -rooted goods to correct their economic path, which includes energy, mining, agriculture, whether wheat, coffee or minerals such as copper and lehium.

The organization confirmed in a report issued today in Geneva on the state of dependence on basic commodities during the years 2021 and 2023 – especially for developing countries that the rooted dependence on these basic products – which has always been a source of world concern – hinders industrial development and threatens financial stability of countries when international prices fluctuate.

She said that it is concerned that relying on basic commodities is widespread in the weak and fragile economies, which affects more than 80 % of the least developed countries, non -coastal developing countries and about 60 % of the developing small island countries.

It revealed that almost two thirds of developing countries – 95 out of 143 countries – remained dependent on basic commodities during the years 2021 and 2023, especially in Central and Western Africa, most of which achieved more than 80% of their exports revenues from primary commodities at the same time that similar patterns appeared in Central Asia and South America, where resource wealth plays a pivotal role in trade.

The report warned that without making more efforts to diversify economies and add value, countries risk wasting the chances of converting their wealth from raw materials into engines for sustainable and flexible growth and said that basic commodity exports are still an essential axis in the global economy, making 32.7 % of international trade in terms of value between 2021 and 2023 with a slight decrease from 35.5 % recorded a decade ago.

The report pointed out that by comparing the two periods, the value of global trade in goods increased by 25.6 %, while the basic commodity trade expanded slowly and did not exceed 15.5 %.

He noted that this shift confirms that countries that issue raw materials mainly may be deprived of taking advantage of the broader advantages of global trade, which is increasingly driven by diversification, innovation and value -added production.

The report pointed out that energy products continued to dominate the trade of global basic commodities and constituted 44.5% of the total value during the period 2021-2023, although this share was much lower than it was a decade before it reached 52.1% and attributed this to the low oil prices and the change in energy demand – including the transformation to renewable energy sources – which reconfigured global trade flows.

At the same time, the report pointed out that the exports of agricultural commodities grew by 34% to reach 2.3 trillion dollars, most of which are foodstuffs, followed by mining products such as minerals and materials, an increase of 33.4% in the value of exports with an average of 1.65 trillion dollars annually during the period 2021-2023.

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