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United Nations Conference on Trade and Development (UNCTAD) Policy Briefs
UNCTAD Policy Briefs provide authoritative data and analysis on trade, investment, finance and technology, offering solutions to the major challenges facing developing countries, particularly the poorest and most vulnerable nations. Beyond tailored analysis and policy recommendations, our research has also generated global standards that govern responsible sovereign lending and borrowing, investment, entrepreneurship, competition and consumer protection and trade rules towards achievement of the 2030 Agenda.
ISSN (online):
27082822
Language:
English
46
results
1 - 20 of 46 results
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Correspondent Banking Relationships and Trade
Publication Date: April 2024More LessBanks often use intermediary banks through CBRs to enable cross-border payments. These relationships are, therefore, critical for international trade transactions that rely on those payments. In recent years, CBRs have declined in many developing economies, and the de-risking strategy of some banks contributes to this trend. This decline in CBRs creates a challenge for LDCs, LLDCs, and SIDS to conduct trade. This brief examines the cause of declining CBRs, and presents a preliminary assessment of how it can affect trade, and proposes possible pathways of action.
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Navigating Troubled Waters: Impact to Global Trade of Disruption of Shipping Routes in the Red Sea, Black Sea and Panama Canal
Publication Date: February 2024More LessMaritime transport, the backbone of international trade, is responsible for 80% of the global movement of goods. Disruptions in key global shipping route – Suez Canal, Panama Canal and Black Sea – signal unprecedented challenges for global trade affecting millions of people in every region. According to the UNCTAD report, attacks on shipping affecting the Suez Canal add to geopolitical tensions impacting shipping routes in the Black Sea, and severe drought due climate change disrupting shipping in the Panama Canal. UNCTAD estimates that transits passing the Suez Canal decreased by 42% compared to its peak. With major players in the shipping industry temporarily suspending Suez transits, weekly container ship transits have fallen by 67%, and container carrying capacity, tanker transits, and gas carriers have experienced significant declines. Meanwhile, total transits through the Panama Canal plummeted by 49% compared to its peak.
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Climate-responsive Central Banking in the Least Developed Countries
Publication Date: February 2024More LessClimate change can have physical and economic impacts that affect core areas of central banking, including inflation and financial sector stability. Central banks, including those of LDCs, need to reevaluate their options in the light of the climate crisis and the global low-carbon transition. This policy brief outlines the ways central banks can identify policy tradeoffs and determine how to best incorporate climate-responsive policy and analytical tools in their operational frameworks. There is increased awareness of how climate change risks can have profound effects on financial sectors and other economic sectors. Two broad classes of climate risks can create financial stress: physical risks – arising from the direct and indirect consequences of climate-related events – and transition risks, associated with the shift towards a low-carbon economy. Examples of physical risks include increased frequency and intensity of extreme weather events, such as hurricanes and floods that damage assets and disrupt supply chains. Transition risks relate to regulatory changes, technological progress, and market shifts that impact the value of investments to which carbon-intensive industries are especially exposed.
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Is the Labour Force in Africa Supply Chain Ready?
Publication Date: February 2024More LessOver the last decade and a half, global supply chains have come under pressure due to geopolitical events, economic uncertainties and natural disasters. Disruptions have led to questions on how to strengthen supply chain resilience, with two key concepts advanced, namely, diversification and flexibility. As global multinationals reconsider resilience, opportunities arise in the following two key areas: countries in Africa can gain entry into supply chains; and multinational firms have an opportunity to diversify into the African continent by strengthening or building new supplier, producer and customer base supply chains. However, as noted in this policy brief, it is imperative for economies in Africa to be adequately prepared and willing to adapt, to ensure participation in global supply chains. The current level of labour productivity in Africa and the connection with supply chains are also discussed.
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Preliminary Assessment of the Economic Impact of the Destruction in Gaza and Prospects for Economic Recovery
Publication Date: January 2024More LessIsrael has occupied Gaza and the West Bank, including East Jerusalem, since June 1967. Despite the “withdrawal” of Israel from Gaza in 2005, it has retained control over its airspace and all land and sea borders, except for the 12 km border with Egypt. Since the early 1990s, and greatly amplified after 2007, the Palestinian people in Gaza have been subjected to prolonged and severe restrictions on their movement that, in combination with tight restrictions on trade in goods, in effect amount to a blockade on the densely populated 365 km2 Gaza Strip. Furthermore, Israel does not allow the construction and operation of air or seaports and bans or restricts the importation of critical production inputs and technology.
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An Equitable and Just Transition to Low-carbon Shipping
Publication Date: November 2023More LessThe twenty-eighth session of the Conference of the Parties to the United Nations Framework Convention on Climate Change provides an opportunity to assess progress in decarbonization efforts in the shipping sector and adds further momentum to carbon reduction actions. As noted in this policy brief, taking swift measures to reduce the carbon footprint of this sector is instrumental’, given the economic role of the sector and the potential for the current carbon footprint to grow in tandem with global economic growth and trade expansion.
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Twin Transition for Global Value Chains: Green and Digital
Publication Date: July 2023More LessThe green and digital transitions have developed in parallel to date, especially in latecomer countries, but green and digital technologies are increasingly becoming intertwined. In this policy brief, greening and digitalizing options for latecomer countries are examined, along with opportunities for benefiting from this twin transition in global value chains. The focus is on environmental and technological upgrading and on how global value chains can become greener by switching to the use of digital frontier technologies associated with smart manufacturing, often referred to as industry 4.0 technologies.
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Industrial Hemp: An Old Crop in a Modern Era
Publication Date: June 2023More LessClimate change and its impacts on the daily lives of billions of people require innovative actions. One potential component of such initiatives could be to advocate for and foster an industrial hemp sector, for exploitation and valorization based on a “whole plant” approach that uses all parts of the plant. Such exploitation could be achieved in most regions of the world, and the whole plant approach would help promote the establishment of various production chains. As discussed in this policy brief, industrial hemp value chains have the potential to be carbon negative and ecologically sustainable and can therefore effectively supplement strategies for sustainable development and the transition to clean energy. Practical experiences worldwide highlight the need for Governments to establish a regulatory and institutional framework supporting the exploitation of all parts of the industrial hemp plant. In this regard, the categorization of industrial hemp as an agricultural commodity subject to regulatory oversight by an agricultural department, as in many member countries of the European Union, rather than a controlled substance, as in Malawi and the United Kingdom of Great Britain and Northern Ireland, is of paramount importance.
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Moving Fast With Frontier Technologies
Publication Date: June 2023More LessIn the last two decades, the use of frontier technologies such as artificial intelligence, the Internet of things and energy from renewable sources has undergone significant growth, and this trend is expected to continue. However, there is still considerable concentration in these markets. The leading frontier technology providers are mostly firms from China, the United States of America and a few other developed countries, with little participation from developing countries. The same pattern is observed with regard to knowledge generation and trade. Governments of developing countries should take proactive action to increase preparedness to use, adopt and adapt such technologies and to take up the economic opportunities linked to them. Some of the challenges associated with the adoption of new technologies in developing countries are addressed in this policy brief, and some policy recommendations are proposed.
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Formulating Strategic Policy Responses to Open Green Windows of Opportunity
Publication Date: May 2023More LessThe depth and speed of green development vary across different environmental technology domains. Accordingly, sectoral and policy responses must be tailored to the “green window of opportunity” in question. Many developing economies have embraced renewable energy sources such as solar power and biofuels, with supportive policies in place to enhance domestic demand. However, the adoption of new and less mature technologies, such as green hydrogen, necessitates considerable investments in research and development, infrastructure and regulatory frameworks, to establish economic feasibility and competitiveness. An overview of renewable energy markets is presented in this policy brief, and four scenarios of green windows of opportunity are highlighted, based on individual responses and preconditions. An “identify-assess-sustain” approach is recommended, to facilitate the transition to green energy.
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Trade Policies for the Low-carbon Transition Need to Take Into Account Least Developed Country Structural Features
Publication Date: January 2023More LessIncreasing the share of manufactured goods in total exports would be beneficial to least developed countries (LDCs), but achieving industrial growth remains elusive. This goal can be jeopardized by the increasing use of trade policy measures to achieve climate or environmental goals. While these goals are legitimate, uncoordinated measures by systemically important traders can have adverse consequences for LDCs. To attenuate them, these traders should adopt special measures to help LDCs adapt to the evolving international regulatory scene. LDCs should invest more on upgrading their productive capacities and intensify trade with regional markets.
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Financial Services: Unlocking the Potential for Export Diversification
Publication Date: January 2023More LessThe services sector presents an opportunity for African countries to diversify their exports through two key facets: (a) the use of innovation and technology in the services sector can strengthen productive capacities, leading to high-quality and more diversified exports of goods; and (b) African countries can diversify exports through intensifying forward and backward linkages with services sectors and increasing export of services. This policy brief, based on the EDAR 2022, presents recommendations on how the roles of financial services and private businesses can be leveraged to strengthen productive capacity and diversify into high-quality exports.
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African Continental Free Trade Area: Design of Dispute Settlement Mechanism Should Reflect Preferences and Realities of All Its Member States
Publication Date: January 2023More LessThe African Continental Free Trade Area is set to promote structural transformation in States parties, in addition to strengthening sustainable and inclusive socioeconomic development and improving gender equality. However, to achieve the desired outcomes and maximize benefits, it is imperative for implementation to be undertaken carefully, with strong and appropriate institutions underpinning the process. A key aspect of any trade agreement involving different parties is the dispute settlement mechanism, aimed at fostering trust, accountability and the rule of law in operationalizing the agreement. UNCTAD, in this policy brief, analyses the framework of the dispute settlement mechanism under the African Continental Free Trade Area Agreement by comparing it with other dispute settlement mechanisms under regional economic communities and the World Trade Organization, with a focus on challenges. In addition, recommendations are made for enhancing the dispute settlement mechanism, to ensure that it is more accessible and aligned with the preferences of member States of the African Continental Free Trade Area.
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Tackling Debt and Climate Challenges in Tandem: A Policy Agenda
Publication Date: November 2022More LessClimate-related shocks are growing in intensity and frequency while the ability of developing countries to address mounting climate challenges is heavily impaired by unsustainable debt burdens. Achieving climate-resilient structural transformation will require many of them to take on more debt. This policy brief highlights the growing overlap between debt and climate vulnerabilities in developing countries and the urgent need for improved access by vulnerable countries to financing on terms consistent with both long-term sustainable development and debt sustainability. It proposes a policy agenda that focuses on a reform of the international debt architecture and on scaling-up public-led and affordable development financing for climate investments.
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Climate-resilience of Seaports: Adequate Finance is Critical for Developing Countries but Remains a Major Challenge
Publication Date: July 2022More LessClimate change impacts on seaports can result in significant and costly damage, operational disruption and delay across global supply chains, with important implications for international trade and the sustainable development prospects of the most vulnerable countries. Timely and effective action on adaptation is a matter of growing urgency. Major scaling up of capacity-building and finance will be critical for developing countries, and time is of the essence.
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The Cost of Doing Too Little Too Late: How Cryptocurrencies Can Undermine Domestic Resource Mobilization in Developing Countries
Publication Date: July 2022More LessFinancing for development requires that countries simultaneously mobilize resources from various sources while tackling financial leakages. This policy brief discusses how cryptocurrencies have become a new channel undermining domestic resource mobilization in developing countries. While cryptocurrencies can facilitate remittances, these same digital technologies may also enable tax evasion or avoidance through offshore flows whose ownership is not easily identifiable. In this way, they may curb the effectiveness of capital controls, a key instrument for developing countries to preserve their policy and fiscal space and macroeconomic stability. This policy brief recommends policies to reduce the financial leakages from cryptocurrencies. Given the global nature of cryptocurrencies, it highlights the importance and urgency of international cooperation regarding cryptocurrency tax treatments, regulation and information sharing as well as of redesigning capital controls to take account of the decentralized, borderless and pseudonymous features of cryptocurrencies.
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Public Payment Systems in the Digital Era: Responding to the Financial Stability and Security-related Risks of Cryptocurrencies
Publication Date: June 2022More LessThe digital era is leading to many changes in the payment system landscape, some of which threaten monetary stability and security in developing countries. To ensure that payment systems function as a public good, monetary authorities should carefully consider the implementation of a central bank digital currency. Depending on national capabilities and needs, and the challenges of creating such a currency, authorities could alternatively create a fast retail payment system. Moreover, given the risk of accentuating the digital divide in developing countries, authorities should maintain the issuance and distribution of cash.
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All That Glitters is Not Gold: The High Cost of Leaving Cryptocurrencies Unregulated
Publication Date: June 2022More LessThe global use of cryptocurrencies increased exponentially during the coronavirus disease (COVID-19) pandemic. Such private digital currencies have become particularly prevalent in developing countries, entailing considerable risks and costs regarding national monetary sovereignty, policy space and macroeconomic stability. In this policy brief, UNCTAD examines such risks and costs, reasons for the uptake of cryptocurrencies in developing countries and the current regulatory landscape. Three policy recommendations that developing countries may consider in this regard are ensuring financial regulation; restricting advertisements related to cryptocurrencies; and providing a safe, reliable and affordable public payment system adapted to the digital era, such as a central bank digital currency or fast retail payment system.
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Strategy for Graduation with Momentum: Bridging Pre-graduation and Post-graduation Development Processes in the Least Developed Countries
Publication Date: April 2022More LessThe development path followed by a country prior to graduation from the least developed country category has significant implications with regard to the challenges to be faced after graduation. The current conceptualization of a smooth transition strategy primarily aims to create a short-term post-graduation “soft landing” and ease concerns with regard to preparation for engaging in economic relations as a non-least developed country. Therefore, the concept currently does not have a focus on preparing countries for graduation with momentum. UNCTAD has maintained that the post-graduation success of a country significantly depends on the foundations built prior to graduation. Graduating countries need a new strategy, one that prepares them for the challenges ahead by linking the graduation process with the development of productive capacities and sustainable development. UNCTAD has proposed an alternative policy framework to help refocus the objectives and strategic direction of graduation strategies, as well as a new time frame for implementation.
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Integrating a Gender Perspective into Trade Facilitation Reforms
Publication Date: April 2022More LessWomen cross-border traders face significant challenges, including time constraints, costs of burdensome procedures, discrimination and harassment at borders. Despite multilateral calls to address those issues and to make trade policies gender-responsive, notably the Revised Buenos Aires Declaration, limited progress has been made on gender equality in trade. This policy brief outlines key gender-based barriers for women traders and provides 10+1 policy recommendations to address them.
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