Aid for trade has bounced back, with Africa as the largest beneficiary, WTO members heard on 9 April 2014, in a meeting where they also discussed the priorities for next two years of initiative.

Preliminary figures for 2012 were presented by the Organization for for Economic Cooperation and Development (OECD) at this session of the Trade and Development Committee focusing on aid for trade. They showed a marked increase following a first fall registered in 2011.

Aid for trade is a WTO-led initiative aiming at increasing the capacity of developing countries, particularly least developed countries (LDCs), to engage in international trade. The OECD is a key partner in this initiative, and monitors the flow of foreign aid targeted at improving countries’ trade policy and regulations (including assistance for trade facilitation – streamlining customs procedures and cutting red tape), building economic infrastructure and building the production capacity of developing countries.

In presenting the aid for trade figures in 2012, Frans Lammersen of the OECD noted that commitments of aid for trade had increased by 20% in 2012. Over $39 billion was also disbursed. He termed this rising expenditure “impressive” given the backdrop of the economic crisis and governments’ tight budgets.

Mr Lammersen noted that the large increase in aid for trade was directed to middle-income countries, mainly in the form of loans. In contrast, the least developed countries’ share of total aid-for-trade flows fell 2% in 2012 and stood at $13.1 bn or 24% of the total. Commenting on the figures, the LDC group, represented by Ambassador Onyanga Aparr of Uganda, called for increased disbursement to benefit the least-developed countries.

The OECD presentation on 2012 Aid-for-Trade Flows is available to download below.

Priorities for new work programme

Members exchanged views on the elements of the new aid-for-trade work programme currently being developed. The work programme will provide a framework for activities over the period 2014-2015 in line with the decision adopted by Ministers at the 2013 Bali Ministerial Conference, which says the programme “should be framed by the post-2015 development agenda”.

Members welcomed the work in aid for trade and stressed the need to maintain the momentum. The committee’s chair of the Committee Pierre Claver Ndayiragije of Burundi said that a draft work programme would be prepared by the WTO Secretariat before the Easter break (18–21 April 2014) for members to review.

A presentation on the new aid-for-trade work programme is available to download below.

Activities

The meeting also heard about activities that WTO members and development agencies undertake in aid for trade. Australia, China and UN Conference on Trade and Development (UNCTAD) introduced their programmes that provide more resources and activities to help developing and least-developed countries to trade.

Peru shared its experience on making trade a government priority.

The Enhanced Integrated Framework, a multi-donor programme that promotes aid for trade among LDCs, presented an overview of its activities to help LDCs play a more active role in the global trading system. And the International Trade Centre, run jointly by the WTO and UNCTAD, shared its experience in supporting the private sector in developing countries.

The WTO secretariat presented a research paper, which shows that aid for trade is of particular importance for LDCs, and that financial inflows benefit their trade performance and development.