Trends in LDC trade

Between 2017 and 2021, exports of goods and services from least-developed countries (LDCs) grew on average by 5 per cent per year, according to the 2022 note on "Market Access for Products and Services of Export Interest to Least Developed Countries" produced by the WTO Secretariat. LDC exports were hit hard by COVID-19, with goods exports recovering more quickly than services exports. Over the past two years, LDCs' share in global exports remained at 0.93 per cent, with global imports staying at 1.39 per cent. Import growth has consistently outpaced export growth, with a widening trade balance (US$ 113 billion in 2021).

LDCs' shares in total world trade of goods and commercial services, 2017-2021

Source: WTO-UNCTAD estimates.

What about LDC merchandise trade?

Growing on a par with world exports, LDC merchandise exports reached US$ 235 billion in 2021 while imports reached US$ 311 billion. LDCs' share in world merchandise exports was 1.08% for both 2021 and 2020.

LDC merchandise exports are highly concentrated among a few exporters, products and markets. In 2021, the top ten LDC exporters accounted for three-quarters of all LDC merchandise exports. Bangladesh was the top exporter (19% of LDCs' merchandise exports), followed by Angola (14%), the Democratic Republic of the Congo (10%), Cambodia (7%) and Myanmar (6%).

Top ten LDC exporters, 2021

Source: WTO-UNCTAD estimates.

Primary commodities, such as oil and minerals, continue to represent a large share in LDCs' merchandise exports. The top exported products in 2021 were crude petroleum oils (accounting for 15% of LDCs' merchandise exports), gold (6%) and refined copper (5%). Clothing was another important export category for LDCs in 2021.

Top ten products of LDC merchandise exports, 2021

Source: Trade Data Monitor (2021)

Ten destinations accounted for nearly 90% of all LDC merchandise exports in 2021. One-quarter of LDC merchandise exports went to China, followed by the European Union (20%), the United Arab Emirates (12%), the United States (10%) and India (7%).

LDCs' top ten export markets, 2021

Source: Trade Data Monitor (2021)

What about LDC services trade?

LDC services exports were hit hard by the pandemic and have experienced a slower recovery than goods. In 2021, LDC services exports grew by 9%, reaching US$ 29.4 billion, roughly half the growth rate of the rest of the world (17%). LDCs' share in world commercial services exports stood at 0.49% in 2021, down from 0.53% in 2020.

The recovery in LDC services exports has varied across regions, with Africa seeing a 26% increase in 2021 while Asia declined by 13%. The top ten LDC exporters of services accounted for three-quarters of LDC services receipts in 2021. Ethiopia was the largest LDC services exporter (18.3% of the overall total), followed by Bangladesh (16.6%) and Tanzania (11%).

Top ten LDC exporters of commercial services, 2021

Source: WTO-UNCTAD estimates.

In 2021, LDC services exports were mostly driven by transport (37%) due to the boost in sea freight revenues, followed by "other commercial services" (covering services ranging from computer services to construction - 29.4%) and travel (26.8%).

Structure of LDCs' exports of commercial services, 2021

Source: WTO-UNCTAD estimates.

Exports of computer services from LDCs were up 37% as the sector expanded in countries such as Bangladesh and Madagascar. LDC participation in global travel exports remained at 1.3% in 2021 as a sharp decline affected economies worldwide. A recovery for this sector, which has traditionally formed the bulk of LDC services exports, has been particularly sluggish for LDCs in Asia.

What about preferential market access?

LDCs continue to enjoy duty-free market access to most developed countries and several developing countries. For example, Australia, New Zealand, Norway and Switzerland offer 100% duty-free market access to LDCs while Chile, the European Union, Iceland and the United Kingdom offer over 99% duty-free market access to LDCs. In addition, Canada, Japan and China offer at least 97% duty-free market access.

For more details, see the Secretariat's 2022 note: WT/COMTD/LDC/W/70.



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