Planning for this Palladium Conversation Series session, began with a sense of urgency. With geopolitical tensions rising, protectionist policies resurfacing, and aid budgets under pressure, the rules of global trade were being rewritten in real time. For developing economies that have depended on global markets for growth, especially over the past three decades, the stakes couldn't be higher.

What does this new uncertainty mean for development? That was the question we set out to explore with a panel of close colleagues and long-time collaborators, each bringing distinct perspectives from trade policy, digital transformation, private sector engagement, and on-the-ground implementation. Our inaugural hybrid event brought together voices from Geneva to Nairobi to London, to understand what the future might hold and what needs to happen now.

Dr. Dan Gay opened the discussion with a sobering analysis. A former UN adviser and long-time advocate for Least Developed Countries (LDCs), Gay has recently modelled the economic impact of new tariffs on LDCs, countries that had previously enjoyed duty- and quota-free access through schemes like AGOA.

Gay’s data-driven assessment was stark: Lesotho could lose up to 10% of its GDP, and as many as 30,000 formal jobs in the export-oriented garment sector which support hundreds of thousands more indirectly. In countries like Haiti, Cambodia, and Bangladesh, the story is much the same. "In countries already struggling with limited diversification and no social safety net, the reimposition of tariffs could mean losing hard-won progress almost overnight," he said. While not all LDCs will be equally affected, Gay emphasised the disproportionate risks for those most reliant on U.S. markets and garments exports. "This is a serious setback," he concluded, "and one that calls for urgent dialogue and new thinking around inclusive trade models."

From Nairobi, Nadia Hasham provided a grounded counterpoint. As Managing Director at Vanguard Economics and advisor to the Rwanda Export Development Programme, Hasham brought the voice of the private sector, especially Small and Medium Enterprises (SME) navigating the fallout.

"Many of our businesses feel like they’re large at home, but they’re small in the global market," she said. "Now there’s real incentive to come together. We’re seeing new associations, new collaborations, even among sectors and groups that historically struggled with collective action." This enables SMEs to pool resources, advocate for policy changes, share compliance costs and build resilience in a more challenging global environment.

Hasham also warned of growing informality: "Tariffs are just a tax on honesty. We’re now incentivising businesses to go underground, and that’s a real loss."

Still, she found hope in the African Continental Free Trade Area (AfCFTA) as an opportunity to diversify and build resilience closer to home. "It’s opening up the mindset. Businesses are taking the rest of the continent seriously as a market."

That theme of diversification and digital opportunity was picked up by Dr Kati Suominen, CEO of NexTrade Group and previously the Technical Director for Palladium’s E-Trade Alliance programme. Few people have done more to articulate the promise of digital trade for developing markets. Suominen's message was clear: digital services are the fastest-growing part of world trade, and countries that enable their SMEs to go digital stand to benefit.

"SMEs using e-commerce are much more export-driven and diversified," she explained. "Digital trade is growing twice as fast as manufacturing exports. There’s real opportunity here."

She also stressed the importance of digital trade agreements like the AfCFTA's new protocol: "We estimate these agreements can boost digital trade by 40% if implemented well."

The final word came from Robin George, Partner at BCG and Team Leader for the UK Growth Gateway. George shared insights from BCG's latest trade modelling, forecasting a reordering of trade flows globally.

"What we’re seeing is structural transformation," George said. "Less trade between China and the West, more within the Global South, and particularly, a rise in trade between Africa and Asia."

George was optimistic about services: "India is already running a trade surplus with many countries in services. In Africa, we’re seeing services grow faster than manufacturing or agriculture. There’s an opportunity here to leapfrog."

In closing, we asked each speaker where development partners like the UK could lead. From investment in digital readiness and value addition, to services trade and regional integration, the answers were diverse but aligned around one theme: the old trade playbook is no longer fit for purpose.

This moment of uncertainty offers the chance to build something new: more inclusive, more sustainable, and more regionally rooted. For leaders and policymakers, that means investing in the infrastructure and regulatory frameworks that enable digital trade, supporting SME access to new markets, and ensuring that services trade does not get sidelined in traditional trade policy. Investors should be looking beyond immediate returns to support catalytic capital that fosters innovation and resilience in emerging economies. And development partners must double down on value addition, regional integration, and partnerships that align long-term commercial incentives with social outcomes.

We’ll need more conversations like this one. The situation is still fluid, and no single roadmap will suffice. Ongoing dialogue is critical to surface new challenges, build consensus, and share what’s working. But even more urgently, we need action that supports a more resilient and inclusive multilateral trade system, one that reflects the new realities of global power, regional integration, and digital transformation. Building this future will take coordination, imagination, and a willingness to adapt the tools of trade and development to a very different world.

Ilmari Soininen is Director, Economic Growth at Palladium