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Aid for Trade: one year on

Working paper

Working paper

A series of WTO meetings on Aid for Trade later this year will determine whether and in what form the Aid for Trade initiative will survive. While Aid for Trade emerged as an issue in the current Doha round of WTO negotiations, it has now acquired an independent momentum outside it. There is now an increased awareness of the importance of trade and development in developed and developing countries and existing Aid for Trade programmes are being improved. WTO regional and general council meetings on Aid for Trade and other discussions forthcoming in the second half of this year will determine how the initiative moves forward. First, donors do not yet regard trade as an objective of aid similar to other areas. Further, it is unclear how the private sector has been involved in the planning and implementation of Aid for Trade. It is also unclear how regional challenges such as cross-border infrastructure can be resolved satisfactory in nationally based development programmes. Finally, after the promises during the run-up to the Hong Kong ministerial, donors are failing miserably on their promises and there is the risk that Aid for Trade will actually decrease as a share of aid. Aid for Trade will need new impetus if it is to survive outside the current WTO negotiations and meet its expectations. The forthcoming meetings can contribute to this.