In 2022, the Commonwealth’s collective Gross Domestic Product (GDP) reached a significant milestone, surpassing US$14 trillion for the first time. Projections suggest that this figure could grow to US$20 trillion by 2029, reflecting the economic potential of the 56-member organization. The Commonwealth also experienced a robust post-pandemic recovery in international trade, with intra-Commonwealth trade reaching a record US$854 billion in 2022. This trend is expected to continue, with intra-Commonwealth trade forecasted to exceed US$1 trillion by 2026. Foreign direct investment (FDI) flows within the Commonwealth also surged, with FDI between member states reaching US$172 billion during the same year.
At the launch of the 2024 Commonwealth Trade Review, Secretary-General Rt Hon Patricia Scotland KC emphasized the critical role of inclusive and sustainable trade. Speaking in anticipation of the upcoming Commonwealth Heads of Government Meeting (CHOGM) in Samoa, she stated, “To achieve the vision of ‘One Resilient Common Future: Transforming Our Common Wealth,’ it is essential to ensure that trade and investment benefit everyone, fostering resilience and sustainability.”
The report not only highlights the Commonwealth’s economic resilience but also underscores the importance of intra-Commonwealth cooperation in fostering robust trade relationships. By focusing on key sectors, such as food security, member nations can work together to build more sustainable and resilient food systems, particularly benefiting the Commonwealth’s smaller states and developing economies.
Food Security and International Trade
The Commonwealth Trade Review aligns with global efforts to meet Sustainable Development Goal 2 on Zero Hunger, an area where progress has been slow. Currently, over two-thirds of Commonwealth nations, especially small states and least developed countries, are net importers of essential food products. These countries rely heavily on international trade to secure their food and nutritional needs.
In 2022, Commonwealth nations imported US$224 billion worth of food while exporting US$263 billion globally. Intra-Commonwealth food trade played a pivotal role in ensuring food security for member nations, with Commonwealth countries trading US$53 billion worth of food among themselves. This represents 24% of their total food imports. The importance of this intra-Commonwealth food trade is especially notable for developing nations and small island states, where access to essential food supplies is critical.
The report provides fresh evidence of the advantages of Commonwealth membership in promoting food trade, which is 22% higher between member states compared to trade with non-members. This effect is particularly significant for exports of vital commodities such as fruits and vegetables, cereals, and fish products—goods that are essential for achieving food security. Additionally, when Commonwealth countries share a trade agreement, this food trade benefit increases to 33%, further emphasizing the value of intra-Commonwealth partnerships.
Processed Food Trade and Investment
The trade in processed food has also witnessed substantial growth, with processed food imports accounting for 47% of the Commonwealth’s total food imports in 2022. This figure equates to US$105 billion in imports. The Trade Review calls for increased investment in the production and trade of healthier, more nutritious food options. This shift could alleviate some of the hidden costs associated with public health and environmental degradation. Furthermore, between 2005 and 2023, Commonwealth countries announced greenfield FDI in food-related sectors totaling US$70 billion, highlighting their ongoing efforts to strengthen food systems within the bloc.
In a video message, World Trade Organization Director-General Dr. Ngozi Okonjo-Iweala praised the Commonwealth’s trade achievements, noting the impressive recovery in intra-Commonwealth trade following the pandemic. In 2022, intra-Commonwealth trade accounted for nearly 3% of global trade, marking its increasing significance on the world stage. The Commonwealth’s focus on using trade as a tool for development provides a promising outlook for the future.
Policy Recommendations and Future Outlook
The 2024 Commonwealth Trade Review also offers a range of policy recommendations aimed at addressing food security challenges. These include enhancing cooperation in food trade, investing in sustainable food production systems, and tackling issues such as food loss and waste. With Commonwealth food imports projected to double to US$486 billion by 2033, the report stresses the need for concerted efforts to ensure the resilience of global food supply chains.
As Commonwealth leaders prepare to meet at CHOGM 2024, discussions will focus on ways to strengthen trade, build economic resilience, and achieve the Sustainable Development Goals. The insights provided in the Commonwealth Trade Review will serve as a critical guide in shaping policies that promote sustainable, inclusive, and resilient trade and investment across the Commonwealth. Through stronger collaboration and targeted investment, the Commonwealth can continue to lead the way in fostering a more secure and sustainable future for all its member states.
