Roundtable 3: The changing face of commodities in the 21st century

Sub-theme 2: Key trade and development issues and the new realities in the geography of the world economy.

Key Issues

Prices for commodities -- raw materials and basic agricultural products -- ended the 20th Century in the doldrums, due mainly to sluggish demand growth in relation to supply. They had been on a declining trend in real terms since the 1980s. However, since 2002, there has been a rebound in commodity prices, driven largely by dynamic new demand emanating from newly industrialized developing countries.

If the cycle of growth and industrialization in developing countries continues, the current commodities boom may mark the beginning of a changed situation characterized by a long-term resurgence in the demand for, and hence the value of, primary commodities in world trade. Such a development holds out the possibility that low-income commodity-dependent developing countries may be able to generate sufficient gains from commodity trade to launch their economies on a sustained growth path of rising per capita income and poverty reduction.

There is always the risk, however, of a levelling out or decline in commodity prices, especially given the sector's cyclical nature. These prospects raise opportunities and challenges, as well as the need for appropriate policy responses.

Purpose of the event

This roundtable will provide an opportunity for Ministers of UNCTAD member countries to review the current global commodity situation and related policy issues, including with respect to major commodity sectors such as oil and gas, minerals and metals, and agricultural products, and, to consider elements of an international response designed to harness long-lasting development gains from the current boom in commodity prices and to address long-standing commodity trade and development problems.

Expected outcome

The roundtable seeks to identify:

Actions for integrating commodity policies into national, regional and international development; poverty reduction strategies; and trade-related policies.
Instruments for resolving commodity problem, including with respect to ODA, Aid for Trade and compensatory financing schemes.