Diversifying export markets and strengthening participation in trade agreements are crucial for building resilience amid growing global trade policy uncertainty, according to a new report from the United Nations Conference on Trade and Development (UNCTAD).
In its Global Trade Update: September 2025, UNCTAD noted that heightened geopolitical tensions and economic challenges are fueling uncertainty in global trade, leading to volatility and greater risks for economies that depend heavily on exports.
The report explained that firms with access to multiple markets are better able to redirect shipments when policy shifts restrict trade in one country, helping to cushion potential revenue losses and production disruptions. It was observed that during recent tariff hikes, companies with well-established regional networks successfully diverted goods to unaffected markets, minimizing the impact on sales.
At the national level, UNCTAD found that countries with broader export bases—selling to a wide range of partners—are more capable of weathering periods of instability. Losses in one region can often be offset by gains in another, resulting in smaller overall contractions and less trade volatility.
The report cited China’s recent trade patterns as a clear example of the benefits of diversification. In the second quarter of 2025, Chinese exports to the rest of the world grew even as shipments to the United States declined. UNCTAD said this shows how multiple markets can help cushion the effects of unpredictable policies and stabilize overall export flows.
Participation in trade agreements was also highlighted as a critical factor in resilience. According to the report, agreements provide clear rules and dispute settlement mechanisms that reduce the risk of sudden policy shifts. Firms operating under regional or bilateral trade frameworks generally experience fewer disruptions and feel more confident making long-term investments, even amid policy volatility.
To restore stability and build stronger resilience in global trade, UNCTAD recommended strengthening agreements with effective dispute resolution systems, ensuring advance notice of proposed policy changes, adopting data-driven trade measures to increase investor confidence, and promoting greater international coordination. The report stressed that timely announcements of trade measures allow for consultations, give trading partners time to adapt, and enable companies to adjust their operations and supply chains more smoothly.
Ultimately, the report emphasized that stable and predictable trade policies are essential for sustaining growth and safeguarding development, particularly in vulnerable economies. It warned that unpredictability over market access can disrupt supply chains, discourage investment, and disproportionately harm low-income countries and smaller firms.