Countries heavily reliant on commodities export must use revenues to boost productivity and technology to escape the "resource curse," the UN said. A majority of the world's developing nations are commodity-dependent.
Countries that depend too much on exporting natural resources face continued poverty, the UN saidImage: Imago Images/Zumapress
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Developing countries dependent on commodity exports face economic challenges that keep their population poor and vulnerable, according to a United Nations report published Wednesday.
In 2019, two-thirds of the world's poorer countries were trapped in commodity dependence, meaning more than 60% of their export revenue came from the sale of primary goods, according to the UN Conference of Trade and Development (UNCTAD) report.
"Commodity-dependent developing countries seem to be locked into this undesirable state," the report said.
UNCTAD classifies countries that derive more than 80% of merchandise exports from primary goods as strongly commodity-dependent.
'Low levels of technology'
According to the UNCTAD, commodity dependence was "strongly associated with low levels of technology," as well as "low levels of labor productivity, low productivity growth."
It said countries that are "more reliant on agriculture exports usually have a lower technological level, followed by countries dependent on mining and then those dependent on fuels."
There is a 7% chance that a country will move from "strong commodity-dependent" to just "commodity-dependent," the report said.
A look at some of the world's scarcest resources
July 29 marks Earth Overshoot Day, the day on which we've used up our entire annual natural resource allotment. DW looks at some of the world's scarcest resources that are running out faster and faster each year.
Image: AFP/S. Qayyum
Water – The source of life
In some parts of the world access to freshwater is taken for granted, but it's actually a luxury. Freshwater only makes up 2.5% of the world's total volume, and more than half of that is ice. Agriculture uses 70% of what's actually usable. By 2050, two-thirds of the world's population is expected to suffer from water scarcity, which will affect all aspects of people's lives.
Image: picture-alliance/Zumapress
Land – The new gold
Competition for land is growing across the globe. As the world's population continues to grow, the available land doesn't and is increasingly degrading. Extreme weather events due to climate change add to the equation. Countries with a large population or scarce land areas for agriculture, such as China and Saudi Arabia, are already seeking land in Africa. Land is seen as the new gold.
Image: Imago/Blickwinkel
Fossil fuels – Speak of the devil
And speaking of oil, fossil fuels should surely have a place at the table of the world's scarce resources if anything because they can't be replenished. Continuing today's rate of consumption will eventually lead to their depletion. This could prove a huge challenge for countries, like Iraq and Libya, which have traditionally had large oil and natural gas reserves.
Image: picture-alliance/dpaH. Oeyvind
Coal – Time to break up
The same goes for coal. Even if countries like Germany are reluctant to move away from this polluting source of energy, the reserves are emptying. In Poland, lignite (or brown coal) reserves from operating mines are expected to run out by 2030. Hard coal might last a little longer, but not much, experts say. Therefore, the country might be forced to break up with coal soon – even if it hurts.
Image: picture alliance/PAP/A. Grygiel
Sand everywhere and nowhere
If we think of a desert, sand seems infinite, but its natural production is actually a rather slow process. Sand is a renewable resource, but it's being used at such a fast rate for things like construction that nature doesn't have time to reproduce it. In developing regions like East Africa, where the population is expected to double by roughly 2050, sand could become a scarce resource.
Image: picture-alliance/ZB/P. Förster
Running out of species
Careless behavior with regard to all living beings on this planet is pushing several species to the brink of extinction. Animals are widely seen as resource for humans, and as such pangolins, rhinos, vaquitas or seahorses could be included in the list of scarce natural resources. If they continue to be exploited resources unsustainably, human life will be at risk.
Image: picture-alliance/Zuma/I. Damanik
The scarcest resource of all? Time
It seems like everything is falling apart and as if nothing more can be done to prevent a bleak future. Yet, one thing that's still available is time, a scarce but extremely valuable resource. Some say the climate emergency could still be reversed if action is taken over the next 12 years. And for once, we are allowed to exploit a resource to the fullest. There is no time to lose.
Image: AFP/S. Qayyum
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It cited the example of countries such as Costa Rica, Malaysia and Indonesia that managed to break the so-called "resource curse" and develop strong manufacturing sectors.
Escaping the 'resource curse'
The report added that commodity dependence will not disappear on its own.
"Unless these countries take strong action to change the status quo, they will remain commodity-dependent for the coming centuries."
However, UNCTAD Acting Secretary-General Isabelle Durant said commodity dependence "must not be seen as fate."
"If developing countries embrace new technologies and innovation, and receive the right support from the international community, they can transform and use their resource wealth for better outcomes," she said in a statement.
