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This paper assesses the achievements and challenges of the WTO-led Aid for Trade initiative. After outlining the achievements, the paper discusses where to put the emphasis, how to expand partnerships, how to enhance effectiveness; and, most importantly, how to retain interest in using aid to make trade work for the poor.
The Aid for Trade Initiative has allowed for the active engagement of a large number of organisations and agencies in helping developing countries and especially the least developed build the infrastructure and supply-side capacity they need to connect to regional and global markets and improve their trade performance. The new development paradigm under the post-2015 Development Agenda requires an integrated approach to ensure that the aid for trade achievement leads to inclusive and sustainable development outcomes. Embedding trade cost at the centre of the Aid for Trade Initiative provides an operational focal point for such action among a broad collation of stakeholders.
The 2015 joint OECD/WTO publication Aid for Trade at a Glance focusses on how reducing trade costs will help in achieving inclusive and sustainable economic growth. The publication contains contributions from the Enhanced Integrated Framework, the International Trade Centre, the United Nations Conference on Trade and Development, and the World Bank.
This note describes some of the major implications and opportunities presented by the new agenda, and the implications for the OECD and its Members in policy formulation, implementation, measuring and monitoring. It gives examples of the contributions the OECD could make to support, monitor, and review progress towards the SDGs to 2030 by drawing on a range of existing policy instruments, dialogue platforms and indicators.
Deepening economic integration via regional co-operation has emerged as a key priority in the reform strategies of most developing economies over the past decade. This is evidenced by the explosive growth in bilateral and regional trading agreements in which they now participate. Regional aid for trade can help developing countries spur regional economic integration, enhance competitiveness, and plug into regional production networks.
Based on a rich set of experiences regarding regional aid for trade projects and programmes, the study finds that regional aid for trade offers great potential as a catalyst for growth, development and poverty reduction. The study recommends greater emphasis on regional aid for trade as a means of improving regional economic integration and development prospects. While regional aid for trade faces many practical implementation challenges, experience has shown that associated problems are not insurmountable but do require thorough planning, careful project formulation, and prioritization on the part of policy makers.
We have come a long way since 2005, when we launched the Aid for Trade initiative in Hong Kong at the 6th WTO Ministerial Conference. Each successive global review has deepened our analysis and broadened our understanding of the dynamics of aid, trade, development and their interaction. In parallel, more and more partner countries and donors have come on board as the tangible results of our efforts become apparent.
The 2013 report Aid for Trade at a Glance: Connecting to Value Chains analyses the strategies, priorities, and programmes from the public and private sectors in developing and developed countries to connect developing country suppliers to value chains. The publication was launched at the 8-10 July 4th Global Review of Aid for Trade at WTO in Geneva and can be read on OECD iLibrary.
On the occasion of the 4th Global Review of Aid for Trade, the OECD and the WTO, in collaboration with GrowAfrica; the International Chamber of Commerce; the International Trade Center; the International Telecommunications Union; and the United Nations World Tourism Organization, conducted a survey among the private sector to identify the barriers that suppliers in developing countries face in connecting to value chains.
The purpose of this OECD Study is to provide the aid-for-trade community with good practices in designing and introducing results frameworks for aid-for-trade projects, and programmes based on country-defined quantifiable targets and a menu of limited number of indicators to measure performance (i.e. outcomes and impacts). We have prepared case studies focusing on Bangladesh, Colombia, Ghana, Rwanda, Solomon Islands and Vietnam.
This study presents a tool to help design logical frameworks for results-based management of aid for trade. What are donors and partner countries trying to achieve? Three different levels of possible objectives (i.e. direct, intermediate and final) are explored. Trade is treated as an intermediate objective, serving as a transmission mechanism, with an increase in the value for trade as the final objective. Six case studies - Bangladesh, Colombia, Ghana, Rwanda, Solomon Islands and Viet Nam - provide a comprehensive overview of the challenges involved in introducing a tool for managing results in an agenda that covers a broad area of interventions that are aimed at building trade-related supply side capacities.
History has shown that openness to trade is a key ingredient for economic success and for improved living standards. But simply opening the economy to international trade is not enough. Developing countries – especially the least developed – require help in building their trade-related capacities in terms of information, policies, procedures, institutions and infrastructure, so as to compete effectively in the global economy. Aid for trade aims to help countries overcome the supply-side constraints that inhibit their ability to benefit from market access opportunities. The almost 300 case stories show clear results of how aid-for-trade programmes are helping developing countries to build human, institutional and infrastructure capacity to integrate into regional and global markets and to make good use of trade opportunities. Together, these stories are a rich and varied source of information on the results of aid for trade activities – an indication of the progress achieved by the Aid-for-Trade Initiative.