The United Nations Conference on Trade and Development (UNCTAD) is urging developing economies to reduce their dependence on the export of key commodities, citing the potential of those with a more diversified economic mix like the Philippines to nurture sustainable growth.

Based on its 2025 State of Commodity Dependence Report released on July 22, UNCTAD reported that 95 out of 143 developing countries are still dependent on commodities for their export market.

Approximately 80 percent of least developed countries and landlocked developing countries and 60 percent of small island developing states are prone to this excessive reliance.

UNCTAD considers a country to be commodity-dependent when it makes more than 60 percent of its export earnings from commodity exports.

The report categorizes commodity trade into three key sectors: energy, mining, and agriculture.

“Entrenched reliance on these primary products—long been of global concern—hinders industrial development and threatens countries’ fiscal stability when global prices go volatile,” it said.

UNCTAD labels the Philippines as a non-commodity dependent economy since the country’s share of commodities only stood at 20.5 percent during the period 2021 to 2023.

Agricultural products accounted for the highest portion of 10.1 percent, followed by mining at 9.1 percent, while energy trailed at 1.3 percent.

According to the Philippine Statistics Authority (PSA), manufactured goods contributed the highest value to the country’s total exports last year, amounting to $58.39 billion or a share of about 80 percent. It was followed by mineral products and agro-based products, with a share of 9.6 percent and 8.1 percent, respectively.

Further, data from the Bangko Sentral ng Pilipinas showed that the services sector contributed the most to the country’s gross domestic product (GDP) last year, accounting for 62.9 percent and totaling ₱16.72 trillion.

The industry sector, which covers manufacturing and mining, had its share at 29.1 percent, which stands at a value of ₱7.34 trillion.

The agriculture, forestry, and fishing sector’s contributions to GDP were at eight percent, equivalent to ₱2.4 trillion.

UNCTAD said this economic mix places the Philippines in a strong position to foster sustainable growth.

However, the report emphasized that diversification should still be complemented by adding value to key commodities.

“Without more efforts to diversify economies and add value, countries risk squandering opportunities to translate their raw material wealth into engines of sustainable and resilient growth,” it said.

UNCTAD said value addition—or the processing of raw materials into higher-value products—will help developing countries strengthen their economies.

Based on UNCTAD data, commodity trade had a downward share in the global economy from 2021 to 2023, which, at 32.7 percent, is lower than the 35.5 percent recorded from 2012 to 2014.

In contrast, trade in manufactured goods expanded significantly, rising to a 25.6-percent share from just 15.5 percent a decade earlier.

“The shift underscores that countries mainly exporting raw materials could miss out on the broader benefits of global trade—increasingly driven by diversification, innovation and value-added production,” the report read.

UNCTAD stated that a combination of targeted policies, strategic investment, and expanded market access can transform developing countries into resilient economies.