World Bank Sounds Alarm as Global Standards Reshape Trade, Leaving Developing Nations Behind

 

A fast-growing maze of international standards governing products, technology and trade is quietly redrawing the global economic map, granting major advantages to richer nations while limiting the competitiveness of developing economies, a new World Bank report warns.

According to the World Development Report 2025: Standards for Development, standards have become one of the most powerful yet least understood forces in global commerce. They determine everything from how food is labelled to how digital devices communicate—and increasingly influence which countries can participate effectively in international markets.

Standards Now Rival Traditional Infrastructure

Once seen as technical checklists, standards have become “foundational economic infrastructure,” the report argues. Their impact rivals that of roads, ports and bridges.

The best example, the report notes, is the standardized shipping container, which boosted global trade more than all trade agreements signed since the 1960s combined. Today, new standards around digital trade, cybersecurity, financial technology and 5G connectivity are expected to play a similar role in shaping the next era of global competition.

But they are also becoming a battleground. Non-tariff measures such as pesticide limits or labelling rules now affect 90 percent of world trade, up from just 15 percent in the late 1990s, making standards a tool of both cooperation and competition.

“Standards are both central and unsung today,” said Indermit Gill, World Bank Chief Economist. “When countries engage in adapting, aligning and authoring standards, they become powerful tools for growth and poverty reduction.”

Developing Countries Absent From Key Decisions

Despite their importance, most low- and middle-income countries remain on the margins of global standard-setting. Tight budgets, limited technical expertise and weak institutional systems prevent them from taking seats on committees where the rules are written.

ISO Secretary-General Sergio Mujica said global participation must be widened to ensure standards reflect the needs of all economies. Over half of ISO’s 20,000 standards have been issued since 2000, he noted, yet developing nations sit on fewer than one-third of the technical committees.

“International standards are no longer invisible infrastructure—they are critical enablers of sustainable development,” he said. “Unlocking their power means allowing all countries to help shape them.”

A Strategy for Turning Standards Into Growth Tools

The report urges countries to approach standards as part of their national development strategy. It recommends a three-step pathway:

Adapt: For less developed markets, modifying global standards to local realities helps firms learn, innovate and grow without being overwhelmed.

Align: As institutions strengthen, aligning with international norms can cut costs, boost exports and help local companies compete internationally.

Author: At higher levels of development, countries should actively shape or write new global standards.

Japan’s transformation—from post-war producer of low-quality goods to world leader in quality manufacturing—demonstrates the power of such a strategy. Through the Japanese Standards Association and the adoption of Total Quality Management, Japan used standards as a springboard to global competitiveness.

A Growing Divide Without Action

The World Bank warns that unless developing countries invest in standards development and participation, they risk being excluded from emerging markets in clean energy, digital services, AI, advanced manufacturing and biotechnology.

“Countries that treat standards as an afterthought fall behind,” said Xavier Giné, Director of the 2025 World Development Report. “Those that make them part of their development strategy are the ones that climb the ladder of prosperity.”

The report calls for stronger global cooperation, targeted support for developing economies and greater transparency in standard-setting systems to ensure the rules of global trade reflect the needs of all nations.