According to UNCTAD, the outlook for trade remains “uncertain”; the UN body cited geopolitical tensions, high commodity prices and record levels of public debt combined with high interest rates, as reasons for concern. UNCTAD’s forecast says global trade is set to stagnate in the first half of 2023.“Missing this green technological wave because of insufficient policy attention or a lack of investment targeted at building skills and capacities would have long-lasting negative consequences,” the UN body’s Technology and Innovation report maintained. Green goods that performed especially well in 2022 included electric and hybrid vehicles, non-plastic packaging and wind turbines. In the second half of the year, however, “positive factors” including a weaker US dollar – the main currency used in trade – stabilized shipping costs and fewer supply chain disruptions, could give trade a boost.
‘Uncertain’ outlook for 2023
Overall, global trade was worth a record trillion in 2022, but deteriorating economic conditions contributed to a downward trend in the second half of the year. Despite global economic uncertainties, UNCTAD said that growth in green goods is here to stay, fueled by momentum on climate action. UNCTAD’s latest Technology and Innovation Report released last week characterized this moment as the “beginning of a green technological revolution”. According to UNCTAD’s latest Global Trade Update, trade in “green goods”, which use fewer resources and pollute less, grew by four per cent in the second half of the year, reaching a record .9 trillion in 2022.
Green growth to continue
UNCTAD believes that international trade patterns will more and more closely reflect the green economic transition that’s underway. The report predicted that the market for electric cars, solar and wind energy, green hydrogen and other more environmentally friendly technologies would quadruple in value by 2030 to reach .1 trillion. “This is good news for the planet, as these goods are key to protecting the environment and fighting climate change,” said UNCTAD economist Alessandro Nicita, one of the report’s authors.
Enduring tech gap
The findings come days after the Intergovernmental Panel on Climate Change (IPCC) warned in its flagship report that greenhouse gas emissions needed to go down now, and be cut by almost half by 2030, if the goal of keeping temperatures from rising more than 1.5 degrees Celsius above pre-industrial levels is to be achieved. UNCTAD also warned that developed countries were seizing most of the economic opportunities related to green technologies, while developing countries were falling behind. Among its recommendations, the UNCTAD report urged the international community to support emerging green industries in developing economies through global trade rules and technology transfers – so that developing countries could “catch up economically, while helping to protect the planet”.