Donors pledge to boost aid-for-trade projects
Friday, 23 November 2007
Frances Williams, FT Syndication Service
GENEVA: International agencies and donor nations this week pledged to strengthen aid programmes designed to boost the exports of developing countries and enable them to take advantage of market opportunities created by lower trade barriers.
The Organisation for Economic Co-operation and Development said aid-for-trade schemes were now running at $21bn (euro14bn, £10bn) a year, accounting for about a quarter of all development assistance. However, critics say much of this money has not been spent effectively and has had little tangible impact.
Aid-for-trade spans help for the construction of essential infrastructure, such as roads and ports, provision of trade services, such as finance and safety testing, advice and training on trade policy and reform, and trade-adjustment assistance.
A two-day conference to review aid-for-trade spending organised by the World Trade Organisation ended last Wednesday with commitments from both rich and poor nations to give trade projects higher priority and to manage them better.
The UK, which last month announced a 50 per cent increase in aid-for-trade by 2010, called for more resources for the 18 poor countries that do not fall under the United Nation's definition of "least developed" - such as Cameroon, Vietnam and Nicaragua - and greater support for region-wide programmes.
"Probably the biggest gains for many poor countries are going to come from trade with their neighbours," Gareth Thomas, a junior UK development minister, told the Financial Times.
Pascal Lamy, the WTO's director-general, said aid-for-trade was an essential complement to the continuing Doha round of global trade talks because many poor countries were unable to exploit market opportunities created by trade liberalisation. "We are moving from making trade possible to making trade happen," he said.
However, development groups said the emphasis on aid-for-trade carried the risk of diverting funds from other critical areas, such as health and education, and could perpetuate unfair trade rules.
"The WTO should get back to the task of creating a better trading system," said Anne Laure Constantin of the US-based Institute for Agriculture and Trade Policy.
The heads of the World Bank and International Monetary Fund called for a quick conclusion of the troubled Doha round.
GENEVA: International agencies and donor nations this week pledged to strengthen aid programmes designed to boost the exports of developing countries and enable them to take advantage of market opportunities created by lower trade barriers.
The Organisation for Economic Co-operation and Development said aid-for-trade schemes were now running at $21bn (euro14bn, £10bn) a year, accounting for about a quarter of all development assistance. However, critics say much of this money has not been spent effectively and has had little tangible impact.
Aid-for-trade spans help for the construction of essential infrastructure, such as roads and ports, provision of trade services, such as finance and safety testing, advice and training on trade policy and reform, and trade-adjustment assistance.
A two-day conference to review aid-for-trade spending organised by the World Trade Organisation ended last Wednesday with commitments from both rich and poor nations to give trade projects higher priority and to manage them better.
The UK, which last month announced a 50 per cent increase in aid-for-trade by 2010, called for more resources for the 18 poor countries that do not fall under the United Nation's definition of "least developed" - such as Cameroon, Vietnam and Nicaragua - and greater support for region-wide programmes.
"Probably the biggest gains for many poor countries are going to come from trade with their neighbours," Gareth Thomas, a junior UK development minister, told the Financial Times.
Pascal Lamy, the WTO's director-general, said aid-for-trade was an essential complement to the continuing Doha round of global trade talks because many poor countries were unable to exploit market opportunities created by trade liberalisation. "We are moving from making trade possible to making trade happen," he said.
However, development groups said the emphasis on aid-for-trade carried the risk of diverting funds from other critical areas, such as health and education, and could perpetuate unfair trade rules.
"The WTO should get back to the task of creating a better trading system," said Anne Laure Constantin of the US-based Institute for Agriculture and Trade Policy.
The heads of the World Bank and International Monetary Fund called for a quick conclusion of the troubled Doha round.