Aid for Trade: Trade as an engine of development
European Commissioner for Trade Karel De Gucht spoke at the Policy Dialogue on Aid for Trade event organized by OECD in Paris, France between 16-17 January, addressing the issue of trade and its potential to boost development. The European Union remains committed to the Aid for Trade initiative that was launched in 2005 and even committed €10.7 billion in 2010.
As Commissioner De Gucht stated: “While trade is certainly a driver of growth and development, it needs the right conditions to flourish. Bottlenecks and inefficiencies – whether at border crossings, or in the way the economy is regulated, or even within the private sector itself – get in the way of prosperity. Making a success of trade, then, means making reforms. Reforms that are sometimes difficult and sometimes expensive, and often have to take place in economic conditions that are less than ideal.” And added: “And that is where Aid for Trade enters the picture – as assistance to those who wish to make the most of trade’s opportunities.”
In addition, Commissioner De Gucht mentioned the impressive outcomes of the Aid for Trade initiative which include the creation of a one-stop border post on the frontier between Zambia and Zimbabwe that has significantly reduced waiting hours, the establishment of a scheme helping farmers and fishermen in Mexico to comply with European food safety requirements and the international recognition of Sri Lanka for its national accreditation body for product testing laboratories.
Moreover, he highlighted the need to focus collective efforts on the countries that want help, to develop additional cross-border and regional programmes, to engage the private sector in these efforts, to promote coordination and trade facilitation by simplifying procedures and bureaucracy for developing countries.
The Aid for Trade initiative was launched in 2005 at the WTO Ministerial Conference in Hong Kong in order to encourage developing country governments and donors to recognize the role that trade can play in development. In 2010, an overall of €25 billion invested on Aid for Trade projects – up 50% on 2006 –have led to Aid for Trade currently accounting for roughly a third of all official development assistance.