Last week, the Commonwealth Secretariat, the United Nations Conference on Trade and Development (UNCTAD), and the Permanent Mission of Nepal in Geneva jointly organized a session at the World Trade Organization’s (WTO) 9th Global Review of the ‘Aid for Trade’ initiative. This session, moderated by Ambassador Kadra Ahmed Hassan of Djibouti, delved into strategies for centering trade within the development agendas of Least Developed Countries (LDCs). Despite their potential, LDCs remain marginalized in the global trade arena, contributing less than 1% to global exports collectively.
The discussion focused on three primary strategic approaches. The first approach emphasized addressing the unique and complex vulnerabilities of LDCs through targeted support aimed at leveraging trade as a catalyst for growth, structural transformation, and sustainable development. This involves creating tailored interventions that align with the specific needs of LDCs to promote their integration into the global trade system.
The second approach highlighted the importance of enhancing productive capacities within LDCs. Strengthening these capacities is crucial for diversifying their economies and exports, thereby positioning them to better navigate potential trade-related challenges both before and after their graduation from LDC status. Building robust productive capacities is seen as a foundational step towards achieving sustainable economic development.
The third strategic focus centered on providing effective support for LDCs transitioning out of the LDC category. This includes ensuring a smooth and sustainable graduation process by granting flexibilities, transition periods, and assistance in capacity-building and institutional arrangements. Such measures are essential to maintaining the momentum of development post-graduation.
Ambassador Ram Prasad Subedi of Nepal articulated the challenges Nepal is expected to encounter upon its graduation in 2026. He stated, “In the WTO, LDCs are seeking some flexibilities, a transition period, a time and space to develop capacity as well as to make institutional arrangements to ensure that graduation becomes smooth, irreversible and sustainable.” His remarks underscored the critical need for supportive measures that facilitate a seamless transition for LDCs exiting the category.
Mr. Paul Akiwumi, Director of the Division for Africa, LDCs, and Special Programmes at UNCTAD, critiqued the traditional commodity-dependent development model, arguing that it has proven ineffective for LDCs. He advocated for more targeted policies and strategies to build diversified productive capacities. He stated, “Fostering productive capacities not only requires a change in the development narrative. It must also be accompanied by a reorientation of macroeconomic, industrial, rural, and infrastructure (including energy, ICTs, and transport) policies and strategies, as well as other relevant sectoral policies.” His insights called for a holistic rethinking of development strategies to support LDCs in achieving sustainable growth.
Dr. Ruth Kattumuri, Senior Director for Economic, Youth, and Sustainable Development at the Commonwealth Secretariat, proposed practical policy solutions to address the trade-related vulnerabilities of LDCs. She emphasized the need for improved access to innovative technologies to enhance productive capacities, stating, “We need better access to innovative new technologies for LDCs to enable them to upgrade their productive capacity, improve productivity, and produce and trade more sophisticated, diverse, and higher value products and services.” Her recommendations highlighted the role of technology in advancing LDCs’ trade capabilities.
Other notable contributions came from Mr. Dinesh Kumar Ghimire, Secretary of the Ministry of Industry, Commerce, and Supplies of Nepal, and Mr. Paul Whittingham, Head of Trade for Development at the UK’s Foreign, Commonwealth & Development Office. They shared valuable insights from their respective countries, demonstrating how LDCs and their development partners can collaborate to create more inclusive, resilient, and sustainable economies through trade and investment leveraging Aid for Trade.
This session was a part of the Memorandum of Understanding (MoU) between the Commonwealth Secretariat and UNCTAD, which aims to foster deeper institutional collaboration. The discussions underscored the significance of strategic, targeted support for LDCs to enhance their participation in global trade, thereby driving their overall development.
