The world is changing, and developing nations are leading the charge! The UNCTAD16 conference recently highlighted the critical role of South-South partnerships in fostering economic resilience and driving growth. This collaboration between developing countries is reshaping the global landscape, offering new avenues for trade, investment, and sustainable development.
At the heart of the discussion was the South-South Cooperation Forum, held on October 23rd during the 16th United Nations Conference on Trade and Development (UNCTAD16). Participants emphasized the growing influence of developing countries, which now represent approximately 40% of the world's economic output. By deepening their cooperation, these economies can accelerate the achievement of the Sustainable Development Goals, strengthen regional value chains, and build collective resilience.
As UNCTAD Deputy Secretary-General Pedro Manuel Moreno put it, "South–South cooperation stands as a testament to solidarity, resilience and shared purpose among developing countries."
South-South Trade: A Rising Star
Over the past three decades, South-South trade has experienced remarkable growth, expanding tenfold. This growth rate significantly surpasses that of North-South trade, and now accounts for over a third of global commerce.
Yuefen Li, Special Advisor on Economics and Development Finance at the South Centre, noted that South-South cooperation is becoming increasingly important due to the rising share of trade and investment in global flows. She also highlighted the increasing significance of South-South initiatives such as BRICS, ASEAN, and Mercosur. Furthermore, she pointed out the growth in southern sources of development finance, including contributions from China, India, Brazil, and some Gulf states.
But here's where it gets controversial... While the potential of South-South collaboration is undeniable, many developing countries still face challenges such as high trade costs, financing constraints, and limited diversification.
UNCTAD's Role: Building Data and Trust
UNCTAD has been instrumental in promoting South-South trade cooperation since the launch of the Global System of Trade Preferences (GSTP) among Developing Countries in the 1980s. The GSTP provides a framework for preferential trade and economic integration across developing regions.
Mr. Moreno also announced significant progress in measuring South-South cooperation, with five countries submitting the first-ever data under a new global framework, and ten more pilot-testing the system. He emphasized that the lack of data has long obscured the contribution of South-South cooperation. The new measurement framework and the South-South Data Fund will ensure that it is visible, measurable, and treated as a strategic resource.
Charting the Path Forward
Speakers at the forum stressed that the next phase of South-South cooperation must focus on amplifying developing-country voices in the international system, responding to the shift to a multipolar world, and leveraging southern sources of finance.
Febrian A. Ruddyard, Vice Minister of the National Development Planning Government of the Republic of Indonesia, stated that South-South cooperation must address institutional and political challenges to translate solidarity into practical cooperation.
The outcomes of the forum will inform the UNCTAD16 outcome document, reaffirming South–South and triangular cooperation as vital engines of inclusive growth and sustainable development.
What do you think? Are you optimistic about the future of South-South cooperation? Do you see any potential obstacles or areas where it could be improved? Share your thoughts in the comments below!
