News and Analysis • Volume 12 • Number 2 • March 2008
WTO Approves Aid for Trade Roadmap
Increasing developing country ownership of Aid for Trade and identifying ways to measure the impacts of such assistance will be the WTO’s main objectives for 2008.
The Aid for Trade (A4T) initiative was formally launched at the WTO’s ministerial conference in December 2005 in Hong Kong, where the EU, Japan and the US pledged funds for activities aimed at helping developing countries, and the least-developed among them in particular, “to build the supply-side capacity and trade-related infrastructure that they need to assist them to implement and benefit from WTO agreements and more broadly to expand their trade.”
A task force set up to ‘operationalise’ this concept within the WTO delivered its recommendations in July 2006 (Bridges Year 10 No.5 page 8). The organisation’s principal role with regard to Aid for Trade is to monitor the implementation of those recommendations both in terms of the funds disbursed and the results achieved in making weaker economies better equipped to participate in international trade. Recipient governments are expected to drive the process through the identification of needs and priorities, and donor countries can channel their contributions through bilateral programmes or regional/ international institutions involved in trade-related development assistance.
Focus on Advancing ‘Concrete’ National and Sub-regional Plans
WTO Director-General Pascal Lamy received the go-ahead for his 2008 Aid for Trade ‘roadmap’ from the WTO Committee for Trade and Development on 25 February.
The roadmap refers to the A4T activities planned for this year by the WTO. A ‘limited number’ of national and sub-regional Aid for Trade reviews will be held in Africa, Latin America and the Caribbean, and in Asia and the Pacific. Each of the reviews will focus on three parts: assessing plans, determining priorities, and agreeing on how plans and priorities should be implemented. Mr Lamy promised that the meetings would be “more focused, technical and results-oriented” than those held last year. The process will culminate in a global Aid for Trade review that will take place within the first six months of 2009.
The overarching objectives guiding WTO activities in the run-up to that event are to strengthen the recipients’ ownership of A4T, to improve monitoring and to move from awareness-raising to the development and implementation on concrete national and subregional plans. Mr Lamy laid particular emphasis on monitoring not just financial flows, but the impact of Aid for Trade activities. Finding ways to measure progress is a priority, he said, and the goal is to come up with a ‘basket of performance indicators’ to help assess trade capacity in developing countries. The World Bank and the OECD, as well as other institutions, have been requested to assist in the identification of such yardsticks.
Unease Growing over Doha Round Linkage
Independently of the WTO review, some poor countries are concerned about what they perceive as donor governments’ attempts to link their potential Aid for Trade gains with the conclusion and outcome of the Doha Round negotiations. Formally, there is no such linkage. The A4T task torce emphasised that Aid for Trade was ‘important in its own right’ and “should assist developing countries to benefit from increased trade opportunities multilaterally (both from previous rounds and from the anticipated results of the DDA), regionally, bilaterally and unilaterally.” It also stated categorically that A4T was “a complement to the Doha Round, but not conditional upon its success.”
Donor governments have already committed themselves to helping build the supply-side capacity and trade-related infrastructure that would allow developing countries to expand their trade. A good faith implementation of this commitment will easily absorb any amount of assistance made available to beneficiaries regardless of the Doha Round outcome.