Project Description

The project brings the matter of commodity sector contribution in the international support programmes for sustained structural transformation of Land Locked Developing Countries (LLDC’s).

Studies undertaken by UNCTAD reveal the significance of commodity dependence in Landlocked Developing Countries (LLDC’s). In a series of Ministerial and expert meetings, UNCTAD, CFC and UN-OHRLLS lead the high-level dialogue on commodities which started in the Second United Nations Conference on Landlocked Developing Countries held in Vienna, Austria in 2014. The working paper on “Turning Commodity Dependence into Sustainable and Inclusive Growth” in particular looked at the policies and strategies necessary to enhance the role of commodities in the development of LLDC’s.

The study points at the importance of commodities in LLDC’s, especially in terms of share of exports, Foreign Direct Investment (FDI) and employment. For instance, the study found that from 2011 to 2013, more than half of all exports from 27 out of 32 LLDC’s were primary commodities. Resource-based goods (i.e. primary goods and resource-based manufactures) accounted for some three-quarters of all exports from LLDC’s as a group. These and other findings clearly indicate that the commodity sector provides an essential link between LLDC’s and the global economy.

Current Status

Transforming commodity dependence in LLDC’s into sustainable, inclusive and equitable economic growth requires action at the regional, national and international level. At the regional level, the study identified transit system improvement as the key priority. Nationally, LLDC’s must link the export commodity sector with domestic sectors as part of their national development strategies. This includes, among other things, putting commodity issues at the heart of domestic development policies, facilitating investment flows to commodities sector, effective participation of LLDC’s in regional and global value chains, promoting (non-) traditional exports and acquiring technologies that improve productivity. International support should include transfer of technology and related know-how, as well as forms of financing that encourage commodity diversification and value addition.

The outcomes of the project have been integrated into the updates on the Vienna Programme of Action (VPoA). Collaboration in follow-up on the recommendations of VPoA is envisioned with specialist institutions participating in the Inter-Agency Working Group (IAG) preparing the review. This includes UN-OHRLLS, UNCTAD, UNDP, UNECA, and the World Bank.

Submitting Institution: UN Office of the High Commissioner for LLDC’s Project: CFC/ILZSG/267
Location: Global Commodity: Miscellaneous
Total Cost: USD 418,000 CFC Financing: USD 335,000 (Grant)

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