The United Nations Conference on Trade and Development (UNCTAD) warned that increased volatility and fragmentation of trade policies are weakening the conditions of stability on which developing countries depend to expand their exports, attract foreign investment and diversify their economies .
In its most recent World Trade Update , the international organization detailed that trade rules have become less predictable .
“Countries are increasingly using discriminatory trade measures such as tariffs, investment controls and technological restrictions linked to industrial policy, national security and geopolitics ,” he said.
For developing countries, such conditions can be detrimental, as many of these nations rely on a limited range of exports and have little capacity to absorb economic shocks.
According to the analysis, despite the current adverse environment, trade continues to be an essential driver for developing countries – known as South-South trade – which has expanded rapidly within the framework of the multilateral trading system, going from $500 billion in 1995 to $6.8 trillion in 2025 .
However, participation remains uneven: the least developed countries account for only 1.1% of global exports , far from the 2% target set for 2030, despite preferential access regimes.
Given this situation, the organization stressed the urgent need to restore certainty to trade rules . A system based on clear and stable rules is key for smaller economies to integrate into global value chains and attract investment.
The World Trade Organization ‘s (WTO) dispute settlement mechanism remains a fundamental tool: since 1995, 644 disputes have been registered, which led to the creation of 378 panels – independent teams of specialists who examine trade disagreements and issue rulings.
“Restoring a fully functional dispute settlement system is essential to maintaining fairness and predictability in global trade,” the UN agency’s report stated .
He also pointed out that services, digital technologies and the green transition are increasingly important sources of economic growth, although many developing countries remain on the sidelines of these sectors.
For example, least developed countries account for less than 1% of global services exports . Between 2014 and 2024, their services exports grew by only 3% annually, compared to 5.3% globally, revealing the barriers they face in participating in the global services economy.
“Clearer multilateral rules in areas such as digital trade, financial services and professional services would also help ensure that developing economies can participate in these emerging sectors,” UNCTAD explained.
The report concludes that strengthening the multilateral trading system is not only an institutional necessity, but an indispensable condition for inclusive and sustainable development .
Strengthening international cooperation and ensuring the full participation of developing countries in new areas of trade will be crucial to sustaining global economic growth and expanding opportunities in an increasingly uncertain environment, marked by constant tariff changes and conflicts such as the one in the Middle East.
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