Commonwealth Trade Ministers will gather in Windhoek, Namibia, in June 2025 for their biennial Ministerial Meeting at a tumultuous time for global trade. Formidable headwinds are buffeting a global trading system already reeling on the back of the lingering effects of the Covid-19 pandemic, the ongoing conflicts in Ukraine and the Middle East, escalating geopolitical tensions, increasing fragmentation of the global economy, and disruption and destabilisation of global supply chains. An alarming trend of rising protectionism – headlined by the current United States administration’s tariff policies, escalating trade tensions and the prospect of a protracted trade war between the United States and China – threatens to further undermine the stability of the global trading order.
The protectionist tariff policies recently announced by the United States could have severe implications for Commonwealth countries. While there is considerable uncertainty surrounding the tariff rates to be applied in the future, they may impact as much as 25 per cent of Commonwealth members’ exports, worth around US$750 billion. When coupled with the wider challenges affecting global trade, the tariff hikes and the prospect of a retreat to protectionism in many parts of the world signal an increasingly uncertain outlook for Commonwealth trade.
This article considers how Commonwealth Trade Ministers might respond to the considerable threats confronting the global trading system and outlines potential opportunities for further collaboration to grow intra-Commonwealth trade and investment.
A collective voice in support of a stronger multilateral trading system
Amid rising trade protectionism, safeguarding the integrity and stability of the rules-based multilateral trading system, and reinforcing trust and confidence in its role as an arbiter of global trade, is likely to be a major priority for Commonwealth Trade Ministers. Commonwealth countries have consistently expressed their support for a fair, transparent, equitable, inclusive, non-discriminatory, and open rules-based multilateral trading system, with the World Trade Organization (WTO) at its core. They have also been vocal in their commitment to supporting all Commonwealth members – particularly small and vulnerable economies – to integrate effectively into the multilateral trading system and enhance their participation in international trade. ÌÇÐÄ̽»¨â€™s shared commitment to multilateralism and international cooperation — anchored in a robust multilateral trading system — is arguably more important than ever given the current global context.
Stronger together: boosting trade and investment within the Commonwealth
Commonwealth countries can look to each other as key partners to shore up trade amid a deteriorating global outlook. The deep historical ties, common language (mainly English), similar legal systems and administrative practices, and large and dynamic diaspora networks between Commonwealth countries provide a structural advantage for trade and investment (ÌÇÐÄ̽»¨, 2021). On average, Commonwealth partners enjoy 21 per cent lower bilateral trade costs, creating a strong foundation for expanding intra-Commonwealth trade (ÌÇÐÄ̽»¨, 2024). These bilateral cost advantages help to drive more trade in merchandise (20 per cent higher), food (22 per cent higher) and modern services (400 per cent higher) between Commonwealth countries. On the back of these advantages, intra-Commonwealth trade in goods and services reached a record high of US$854 billion in 2022 and is expected to surpass $1 trillion by 2026 (ibid.).
There is also evidence of a persistent and growing Commonwealth advantage in investment. Prior to the outbreak of the COVID-19 pandemic, foreign direct investment (FDI) flows between Commonwealth member countries were 27 per cent higher, on average, than those between other country pairs (ÌÇÐÄ̽»¨, 2021). Greenfield investments announced between Commonwealth countries, which are crucial for building new productive capacity, were 3.5 times greater, on average, from 2003 to 2022 (ÌÇÐÄ̽»¨, 2024).
The recent trajectory of intra-Commonwealth investment is encouraging, even as growth in global investment flows has slowed considerably. Intra-Commonwealth FDI inward stock almost doubled between 2015 and 2022, reaching US$1.7 trillion (ibid.). FDI flows between Commonwealth members more than quadrupled in value over the same period and totalled $172 billion in 2022 (ibid.).
Mobilising Investment for Sustainable Growth
Looking to grow these investment flows even further, Commonwealth Trade Ministers made a commitment when then last met in London in 2023 to explore mutually beneficial investment initiatives and partnerships across the Commonwealth. They expressed particular emphasis on promoting high-quality infrastructure investments – especially in green infrastructure and technologies – to boost productive capacity and drive sustainable economic growth. To support these endeavours, pan-Commonwealth platforms – including the Commonwealth Connectivity Agenda, Commonwealth Working Group on Trade and Investment and its Sub-Action Group on Investment – have been established to enable Commonwealth members and their business communities to engage in collective action to grow intra-Commonwealth trade and investment.
The commitment to expanding investment flows between Commonwealth countries and a desire to mobilise investment where it is most urgently needed was evident during the last Commonwealth Heads of Government Meeting in Samoa in October 2024, where Commonwealth leaders launched a Plan of Action on Investment. Through pillars focused on technical support, knowledge exchange and engagement with the private sector, the plan aims to address key challenges faced by Commonwealth countries, particularly developing and small states, in securing the necessary investment to meet the Sustainable Development Goals (SDGs) by 2030. In an important step towards delivering these objectives, work is underway to establish a Commonwealth Investment Network (CIN), with seed funding provided by the United Kingdom. The CIN will look to establish an ecosystem of international partners working together to exchange knowledge, provide tailored technical assistance and capacity building, and facilitate private sector investments into climate and climate-resilient projects in small island developing states in the Commonwealth.
Sustainability and resilience headline an expanding ‘to do’ list
Beyond these endeavours, and the increasingly urgent need to counteract the protectionist undercurrents undermining the global trading system, other pressing matters are also likely to occupy the thoughts of Commonwealth Trade Ministers and senior officials when they assemble in Windhoek. They may look to ways to increase cooperation to strengthen food security. More than two-thirds of the Commonwealth membership (40 of 56 countries) are net importers of essential foods and rely heavily on imported agricultural products and foods to meet their food security needs (ÌÇÐÄ̽»¨, 2024). Greater collaboration to diversify and expand food trade between Commonwealth countries would help to connect supplies in large food-producing members (such as Australia, Canada, Malaysia, New Zealand and South Africa) with demand in those countries facing significant food security challenges.
Commonwealth Trade Ministers could also devote some time in Windhoek to explore opportunities for deeper cooperation and enhanced trade and investment in renewable energy and related supply chains in support of a just and equitable sustainable energy transition. Th transition is imperative if the climate change targets outlined in the Paris Agreement as well as the goal of universal access to affordable and clean energy (SDG 7) are to be achieved across the Commonwealth.
The themes of sustainability and resilience are expected to serve as overarching frameworks guiding the deliberations in Namibia. This may extend to discussion of ways to collectively promote green trade and the development of circular economies, build more sustainable and resilient supply chains (including for critical minerals), and drive digital transformation and innovation within the Commonwealth.
Pursuing deeper cooperation
Greater cooperation on trade and investment is essential if Commonwealth leaders’ shared ambition to grow intra-Commonwealth trade to US$2 trillion is to be achieved by 2030. Collaboration at a pan-Commonwealth level could look to build on existing frameworks to strengthen trade facilitation; accelerate trade digitalisation through advances towards cross-border paperless trade and via the integration of artificial intelligence and other emerging technologies supporting digital trade; and/or adopt a longer-term approach to the removal of trade barriers and harmonisation of standards and regulations (Zaman, 2025). Regardless of the form it takes, deeper economic cooperation in the Commonwealth seems imperative to provide a bulwark against the mounting challenges and significant uncertainty confronting the global trading landscape.
Neil Balchin is the Economic Adviser, Trade Policy Analysis, International Trade Policy at the ÌÇÐÄ̽»¨.
This article was first published on the website.
References
ÌÇÐÄ̽»¨ (2021) Energising Commonwealth Trade in a Digital World: Paths to Recovery Post-COVID. Commonwealth Trade Review 2021. London: ÌÇÐÄ̽»¨.
ÌÇÐÄ̽»¨ (2024) Strengthening Food Security in the Commonwealth: Trade, Investment and Resilient Supply Chains. Commonwealth Trade Review 2024. London: ÌÇÐÄ̽»¨.
Grantham-Philips, W. (2025)
Zaman, A. (2025)
Based on the Reciprocal Tariffs announced by the United States on 2 April 2025. These tariffs were paused for 90 days just hours after they took effect on 9 April 2025, leaving a 10 per cent levy in place for nearly all global goods imported by the United States (Grantham-Philips, 2025). The tariff situation is constantly evolving as countries consider how to respond and some seek to negotiate better trading terms with the United States.
