WTO members, international organizations outline Aid for Trade activities amid COVID-19
An overview of recent Aid for Trade activities was given by WTO members, international financial institutions and observer organisations at a session of the Committee on Trade and Development on 8 February dedicated to the Aid for Trade initiative. A workshop organized by the Committee on 7 February explored how the COVID-19 pandemic has accelerated the shift towards the digital economy and the constraints that developing countries face.
The WTO-led Aid for Trade Initiative encourages developing country governments and donors to recognize the role that trade can play in meeting countries’ development objectives. The initiative also encourages action to address the trade-related constraints identified by developing and least-developed countries (LDCs).
China provided an update on its technical assistance and investment cooperation activities, highlighting that it has distributed close to 2 billion doses of COVID-19 vaccines globally. It is currently assisting 20 countries build domestic vaccine production capacity. Members’ attention was also drawn to the Tenth China Roundtable, held virtually in January 2022.
The Republic of Korea gave a rundown of its programmes to build trade-related capacities in developing countries. These include the country’s collaboration on the latest phase of the NTF V programme aimed at helping African micro, small and medium-sized enterprises (MSMEs) in the field of digital technology and agribusiness nurture business opportunities. It also announced a scaling up of its contributions to several trust funds, including the WTO Chairs Programme.
Russia underlined the funding it provided through United Nations bodies to help developing countries meet their development objectives. In particular, it drew attention to the second Russia-Africa Summit — scheduled for October-November 2022 in Addis Ababa, Ethiopia — which aims to increase trade flows between Russia and the African continent.
The United States highlighted the PROSPER Africa Initiative, which seeks to leverage private capital, promote trade between the US and African businesses, and support implementation of the African Continental Free Trade Area. Since 2019, it has established over 60 partnerships, administered over USD 62 million in grants, and facilitated over USD 600 million worth of exports.
Tajikistan outlined its efforts to expand exports and facilitate trade and investment, notably through the implementation of the WTO’s Trade Facilitation Agreement. In April 2019, Tajikistan launched a national Trade Portal in connection with the Global Trade Help Desk to provide a single-entry point for information on trade flows and tariff regulatory requirements.
International financial institutions provided reports on resource mobilisation and Aid-for-Trade related activities.
The Asian Development Bank (ADB) noted that trade was picking up in Asia, amidst a scaling up of the COVID-19 vaccine roll-out. Developing Asian countries are expected to sustain their rebound, with regional projections of growth of 7 per cent in 2021 and 5.3 per cent in 2022. ADB provides loans, grants and technical assistance to its developing country members, including for the roll-out of COVID-19 vaccination campaigns.
The Enhanced Integrated Framework presented an overview of projects aimed at addressing the trade priorities in LDCs. In Timor Leste, a project is currently underway to support tourism, economic recovery and women’s economic empowerment. A technology needs assessment was started in Lao PDR and Senegal to maximise the impact of technology and foster structural transformations.
The Organisation for Economic Co-operation and Development (OECD) highlighted its “Peer Learning event on Aid for Trade” held in December 2021. The event highlighted the importance of reinforcing Aid-for-Trade capacity-building projects to help developing countries tap into the opportunities for sustainable growth that the economic recovery brings.
The Islamic Trade Finance Corporation (ITFC) presented its initiatives to increase trade opportunities for its member countries. It highlighted that an ITFC programme to harmonize standards for pharmaceutical and medical devices in Africa was recently launched under the aegis of the “Arab-Africa Foreign Trade Bridge”. The Bank also noted its involvement in the SheTrades initiative of the International Trade Centre.
The Standards and Trade Development Facility (STDF) provided an overview of its “Guide of Good Regulatory Practices” launched in November 2021. The Guide seeks to ensure that sanitary and phytosanitary measures are fit for purpose and do not create unnecessary trade barriers. A project is underway to assess virtual food inspection and audits in collaboration with the United Nations Industrial Development Organization, as well as a gender assessment aimed at making recommendations on gender equality and women’s empowerment in developing countries.
The World Bank‘s latest Global Economic Prospects outlined some of the challenges that developing countries face in their economic recovery from the COVID-19 pandemic. The report noted that these challenges could be mitigated through policies targeting rapid and equitable COVID-19 vaccine distribution, climate change mitigation and the strengthening of global cooperation — including on trade governance.
The International Trade Centre presented its Strategic Plan 2022–2025, which outlined how it will support developing countries in making their economies more inclusive, sustainable and prosperous through trade. The focus will be on enhancing the competitiveness of MSMEs.
Find out more about the Aid for Trade initiative here.
The workshop on “Digital Connectivity and Economic Diversification” explored the trade opportunities that digitalization brings to the information and communications technologies (ICT) sector, as well as for goods and services, and parcel trade in particular. OECD research suggests that a 10 per cent increase in digital connectivity comes with a 4 per cent increase in parcel trade.
While the COVID-19 pandemic spurred growth in the global trade of ICT goods — which grew 4 per cent year on year between 2019 and 2020 to reach USD 2.3 trillion — UNCTAD research suggests it favoured existing developing Asian exporters. Growth in digitally deliverable services was more balanced across countries, although measurement issues continue to pose problems to accurately track trade flows.
The affordability of digital connectivity is a major obstacle identified by the World Bank. Digital systems are also an integral part of clean energy transition and underlined in the nationally determined priorities of many countries.
E-government services and social media have helped drive Madagascar‘s digital connectivity, with support from donors, particularly in the area of ICT skills. Madagascar’s economy was hit hard by the tropical storm Ana and the tropical cyclone Batsirai, in addition to the COVID-19 pandemic, while the government was already looking to address shortcomings in access to energy and to update regulatory frameworks for digital trade.
The European Union noted that support for digital connectivity has become more prominent in its Aid-for-Trade programming and would be further strengthened through the roll out of the Digital for Development (D4D) Hub. Supporting digital connectivity is also a key objective of the ADB future programming up to 2030, and a focus area for ADB’s knowledge products.
Copies of all presentations and a recording of the workshop can be found here.
- The dates of the Aid for Trade Global Review are under consideration. back to text