Aid for Trade and Development Aid for Trade and Development Part I Rajan Dhanjee Office of the Director Division on International Trade in Goods and Services, and Commodities UNCTAD

2 Background (1/2) Trade, not aid?Trade, not aid? Developing countries’ difficulties in:Developing countries’ difficulties in:  Implementing Uruguay Round agreements  Adjusting to trade reform (preference erosion, loss of customs revenue, declining terms of trade, etc.)  Benefiting from preference schemes  Overcoming “supply-side” (productive capacity, infrastructure, etc.) and institutional constraints  Enhancing trading competitiveness to promote development

3 Background (2/2) Growing acceptance need for AfT:Growing acceptance need for AfT:  ODA pressures/commitments  Monterrey Consensus   UN Millennium Project Report (Sachs Report)  UN S-G message to 5th WTO Ministerial  World Summit Outcome  Blair Commission  Joint IMF/World Bank proposal

4 6th WTO Ministerial Para. 57 HKMD: Para. 57 HKMD:  Should aim to help developing countries, particularly LDCs, to build supply-side capacity and trade-related infrastructure needed to implement and benefit from WTO Agreements and more broadly, expand their trade  Not substitute for development benefits from successful conclusion to Doha Round - however can be a valuable complement

5 WTO Task Force (1/2) AFT categories:AFT categories: 1.Trade policy and regulations 2.Trade development 3.Trade-related infrastructure 4.Building productive capacity 5.Trade-related adjustment 6.Other trade-related needs

6 WTO Task Force (2/2) AFT objectives to:AFT objectives to: Enable developing countries, particularly LDCs, to use trade more effectively to promote growth, development and poverty reduction,and to achieve their development objectives, including the MDGs. Help developing countries, particularly LDCs, to build supply-side capacity and trade-related infrastructure in order to facilitate their access to markets and to export more. Help facilitate, implement, and adjust to trade reform and liberalization. Assist regional integration. Assist smooth integration into the world trading system. Assist in implementation of trade agreements.

7 UNCTAD role in AfT Derived from core function as UN focal point on integrated treatment of trade and development Comparative advantage in: 1.Providing integrated perspective on trade and development strategies and policies 2.Promoting coherence at national, regional and international levels 3.Drawing on 3 pillars (intergovernmental policy dialogue and consensus-building, research and policy analysis, technical assistance)

8 Relevant UNCTAD activities (1/2) Assistance/support in: - Participating effectively in of negotiations, WTO accession processes, implementing trade agreements, developing services sectors, addressing NTBs, meeting product standards and regulations - Formulating trade, investment, technology-related policies - Drafting and implementing competition laws - Adjusting to trade reform - Trade facilitation infrastructure, e.g. customs automation - Databases, e.g. on NTBs - Promotion of Enhanced Integrated Framework - Enterprise development - One UN country programmes

9 Relevant UNCTAD activities (2/2) UNCTAD/Comsec Conference - G24 Working Papers - UNCTAD XII pre- and parallel events - Forthcoming book with UNU “Aid for Trade and Development: Global and Regional Perspectives” Participation in: - WTO D-G’s Advisory Group on AfT - UN Cluster on Trade and Productive Capacity - Working Group on Trade of UN Executive Committee on Economic and Social Affairs

10 Accra outcome on AfT (1/2) Accra Declaration (para. 11), Consensus paras. 61, 71, 106:Accra Declaration (para. 11), Consensus paras. 61, 71, 106: 1.Stronger national action and international support 2.Adequately resourced, increased, more effective, additional, predictable, sustainable and effective 3.Based on each beneficiary country’s needs and priorities – should mainstream trade and integrate Aft into development strategies in accordance with national priorities 4.Mechanisms to ensure efficient and effective utilization

11 Accra outcome on AfT (2/2) 5.Implemented through multilateral and bilateral channels with UN and other multilateral organizations playing important role 6.UNCTAD should continue to: a.Play important role in developing and implementing AfT projects b.Provide focused support in building capacity of developing countries to meaningfully participate in and benefit from the international trading system and address its opportunities and challenges

12 Issues for discussion 1.Why do developing countries or regions need Aft – can you provide examples of such needs – how are trade, development and poverty reduction linked? 2.Are the categories and objectives of AfT listed above appropriate –can you think of more - how new or trade-related are these categories? 3.Do you agree with the principles relating to AfT highlighted above (complement but not substitute for Round, adequate, additional, based on beneficiary country’s needs and priorities, mainstreaming into development strategies) – can you think of others? 4.Is there anything more UNCTAD could do on AfT?