Green technology exports represent a vital bright spot in the current global trade landscape. While overall growth remains weak, these environmentally friendly goods show remarkable resilience. According to the United Nations Conference on Trade and Development (UNCTAD), global trade hit a record US$32tn in 2022. However, the second half of that year experienced lacklustre growth across most sectors.
The Rise of Green Technology Exports
Despite a general decline in goods trade during late 2022, green technology exports outperformed the broader market. Specifically, trade in these goods totaled US$1.9tn in 2022. This figure represents over 10% of all trade in manufactured goods. Furthermore, UNCTAD predicts massive growth for frontier technologies like green hydrogen and artificial intelligence. While these markets held a US$1.5tn value in 2020, they could reach US$9.5tn by 2030.
Developing Nations and Green Technology Exports
Some developing countries are making significant progress with green technology exports such as biofuels and solar energy. For instance, Brazil, China, and India appear in the top 50 of UNCTAD’s readiness index. This index ranks nations based on their industrial capacity, research, and finance. However, developed nations currently increase their exports at a much faster pace. Between 2018 and 2021, developed economies saw these shipments jump from US$60bn to over US$156bn.
Protecting Infant Green Industries
Developing countries face a limited window of opportunity to capture renewable energy markets. Without swift action, they risk remaining locked into fossil-fuel pathways. Consequently, UNCTAD suggests a review of global trade rules. Such changes would allow developing nations to protect infant industries through subsidies and public procurement. Moreover, specific regions like Africa and Southern Asia possess huge potential for green hydrogen. This potential stems from their abundant solar and wind resources.
Courtesy: Global Trade Review
