About OECD/WTO Aid for Trade at a Glance
The Aid for Trade Initiative is a global initiative that was launched following the 2005 Hong Kong WTO Ministerial Conference where countries agreed to expand of aid to support developing countries to increase exports of goods and services, and to benefit from free trade and increased market access.
The Aid for Trade Initiative is not just about a question of how much Aid for Trade is available or whether to earmark more money to Aid for Trade, but whether it is effective and actually benefiting the recipients of that aid. The WTO Task Force recommended in 2006 that monitoring of Aid for Trade be strengthened and that the Paris Declaration on Aid Effectiveness be used as the guiding principles for the delivery of Aid for Trade. And the basic mechanism to improve the effectiveness of Aid for Trade is monitoring itself. As such, the Task Force also underscored that donors and recipient countries have a responsibility to report on progress and results.
OECD and WTO have developed a very constructive collaboration in shaping the aid-for-trade debate and strengthening the Initiative from its outset to ensure Aid for Trade is delivered and used effectively. This namely involved setting out the framework for the global monitoring system to assess whether additional Aid for Trade resources are being delivered, to identify where gaps lie, to highlight where improvements should be made, and to increase transparency on pledges and disbursements.
To assess whether progress is being made towards the desired objectives of the Aid for Trade Initiative, OECD and WTO have jointly developed a simple, intuitive, logical monitoring framework which consists of:
- Demand for trade-related development assistance as expressed in national development strategies
- Donor response in the form of Aid for Trade programmes and projects
- Outcomes of the Aid for Trade programmes and projects in terms of improved trade capacities, and finally
- Impact on long-term development objectives, such as MDGs
This framework enables OECD and WTO to elicit critical quantitative and qualitative information from donor agencies and their partner governments to arrive at a comprehensive Aid for Trade picture. On the basis of this framework, the success of the Aid for Trade Initiative may be measured on three fronts:
- Greater awareness and mainstreaming of trade;
- Increased levels of Aid for Trade flows; and
- More effective Aid for Trade interventions (i.e. demonstration outcomes and impact)
The focus of the OECD-WTO monitoring exercise so far has been on the first two dimensions which are “Raising awareness about trade” and “Mobilizing resources”. Monitoring of the third aspect is more complex and a challenge which must be addressed. The Aid for Trade Initiative will succeed only if it produces results. Such need to demonstrate that Aid for Trade works at the country level is particularly pressing considering the significant additional resources that have been directed toward trade-related activities since the Initiative was launched in 2005.
The centrepiece of the monitoring framework is the joint OECD-WTO publication, Aid for Trade at a Glance. The central theme of the 2011 report is “showing results”. In this context, OECD-WTO have extended the monitoring exercise beyond self-assessments and launched a call for Case Stories, to obtain firsthand knowledge about outcomes and impacts of aid for trade on the ground, from partner countries, donors (including the providers of South-South cooperation), multilateral and regional organizations, NGOs/CSOs, and academic and research institutes. These case stories about policies, processes and programmes will provide the Global Review with a wealth of evidence on what has worked and where it could work better. The joint OECD-WTO report will present the results in aid-for-trade country facts sheets which provide, at a glance, the demand, supply, outcomes and impacts of aid for trade.
What is aid for trade (video)