Trade integration is a key determinant for long-run growth and poverty reduction for all countries in the region, said IDB President Luis Alberto Moreno during the opening session of the global review for Aid for Trade (AFT) being held today and tomorrow in Geneva, Switzerland.
The aim of the AFT Initiative, launched in December 2005 at the WTO Ministerial Conference in Hong Kong, is to help developing countries build the supply-side capacity and infrastructure they need to take advantage of trade liberalization and enhance their participation in the world trading system.
“The challenge is to build the capacity and infrastructure that countries need to take advantage of, and connect to, today’s dynamic global economy,” said Moreno. “Succeeding in today’s integrated global economy requires systemic competitiveness, coherent policies and broad public support.”
During this week’s event, “Mobilizing Aid for Trade: A Global Review,” participants will discuss the results of three regional conferences held this year under the AFT initiative. The first regional conference, held in mid September in Lima, Perú, focused on Latin America and the Caribbean and was led by the Inter-American Development Bank. The other two, in late September and in October, focused on Asia and Africa and were led by the Asian Development Bank and African Development Bank, respectively.
According to President Moreno, the event in Lima was a unique opportunity that for the first time brought together trade and finance ministers, bilateral donors, regional and multilateral agencies and private sector representatives to discuss how to build the capacity and infrastructure that Latin America and the Caribbean countries need to take advantage and connect to today's dynamic global economy. The meeting helped shift the focus of the aid-for-trade initiative from policy debate to implementation.
“Globalization is changing the development dynamics, creating new opportunities for countries to harness trade for growth and poverty reduction, but also creating new pressures to strengthen competitiveness and to "connect" more effectively with global markets,” said Moreno. “These changes are particularly relevant to the countries of Latin America and the Caribbean, most of whom are highly trade dependent and whose economic strategies increasingly hinge on export growth.”
Other high-level participants at this week’s event include WTO Director General, Pascal Lamy, OECD Secretary General Angel Gurría; Robert Zoellick, President of the World Bank; Dominique Strauss-Kahn, Managing Director of the IMF; Kemal Dervis, Administrator of the UNDP; Donald Kaberuka, President of the African Development Bank; Rajat Nag, Managing Director General of the Asian Development Bank.
As part of the meeting, the IDB and the WTO recommendations stemming from the regional meeting held in Lima. Among those recommendations, IDB and WTO propose that countries update national and regional action and implementation plans to address key priorities, building on existing needs assessments; to set up an AFT Network in Latin America and the Caribbean led by IDB and WTO to assist countries and sub-regions in mapping out those priorities, in collaboration with regional organizations; and to explore funding for priority projects, including specific regional financial facilities.
A roadmap and a timetable to accomplish this will be set up. This roadmap will include a regional “stock taking” conference to be held in Latin America next year.
The global review will conclude on November 21 when the WTO General Council holds its first annual debate on AFT. This meeting will give WTO members an opportunity to discuss the results of the WTO monitoring process, and provide political guidance on future directions of the initiative.