Inclusive diversification and the energy transition: Prospects and challenges
Most economic value chains involve commodities, and developing countries that depend on exporting primary products are often vulnerable to macroeconomic instability, delayed industrialization or deindustrialization and volatility in export revenue caused by commodity price fluctuations. Many commodity-dependent developing countries are among the most vulnerable to the impacts of climate change. The pandemic and the war in Ukraine have further exposed the vulnerabilities of these countries and highlighted the urgent need for them to become more resilient by moving up value chains and diversifying economies. However, commodity-dependent developing countries also need to diversify in a new way, namely, through low-carbon paths in the context of climate change and the energy transition. In addition, these countries need to make growth less carbon intensive without compromising economic development. Inclusive and green diversification is possible if the right to development of commodity-dependent developing countries, the need to address climate change and existing inequalities are addressed in a common and balanced way. Commodity-dependent developing countries need to leverage untapped potential in renewable energy sources, to explore new energy markets and green products that can help create new jobs, boost incomes and reduce inequalities, for example by linking the mining of clean energy minerals such as cobalt and lithium with local value addition. Finally, green industrial policies can help to achieve just diversification pathways in these countries. The course will discuss ways in which these countries can become more resilient by diversifying production and moving up value chains, to produce and export a wider variety of products, and do so in ways that are inclusive and climate friendly. The course has the following objectives:
- Raise awareness of the prospects for and challenges to inclusive diversification and the energy transition in commodity-dependent developing countries
- Ensure an understanding of the enablers of export diversification, the factors that affect inequality in this process, the historical relationship between diversification and carbon emissions and the policy tools that can foster inclusive and greener economic diversification
Clovis Freire Junior is Chief, Commodity Research and Analysis Section, Commodities Branch, of the Division on International Trade and Commodities of UNCTAD in Geneva. He is an Economist specialized in economic diversification and strategies for building productive capacities in developing countries. His work supports the structural transformation and sustainable development of commodity-dependent developing countries. He has over 20 years of work experience in the United Nations in programmes related to commodity dependence, least developed countries, technology and innovation for development, and disaster risk reduction. He holds a degree in Computer Engineering from the Technological Institute of Aeronautics (ITA), Brazil, a Master’s degree in Computer Sciences from the University de Brasília (UnB), an MBA in Strategic Management of Information Systems from the Fundação Getúlio Vargas (FGV), Brazil, and a PhD in Economics from the Maastricht University, in Maastricht, the Netherlands.
Rachid Amui is an Economic Affairs Officer in the Commodities Research and Analysis Section of the Commodities Branch, Division on International Trade and Commodities at UNCTAD.
His research interests are in extractive industries and development, and commodity price risk management.
Prior to joining UNCTAD in 2003, Rachid worked extensively in the field of structures and foundation engineering.
Sofia Dominguez is an Associate Economic Affairs Officer in the Division on International Trade and Commodities at UNCTAD. She specializes in economic research focused on development topics related to commodity dependence and commodity-dependent countries. Sofia has contributed to multiple publications covering a range of topics including diversification and inequality, value addition, and trade dynamics along critical mineral value chains. These publications shed light on pressing issues within the field. She holds an MSc in Economics from the University of Warwick.
