This document discusses aid for trade (AfT) and its role in development. It makes several key points: 1) AfT is important for supporting trade-related policies, regulations, adjustments, and building productive capacity in developing countries. 2) Over 1/3 of total AfT is provided by the EU, with increasing focus on least developed countries and those most in need. 3) AfT faces challenges at the national, regional, and sectoral levels including coordination between different actors and improving private sector involvement. Going beyond aid to leverage private resources will be important.

1. Aid for trade
and beyond
Development Perspectives
Dr San Bilal

2. Aid for Trade logic
• Important role played by trade in
development
• Trade can lead to different growth trajectories
• Importance of adjustment policies and
domestic agenda/reforms
• Need aid for trade-related: (1)
policies and regulation (2)
adjustments (3)
building productive capacity
(4) infrastructures
• Aid effectiveness principles
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3. Increasing Aid for Trade…
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4. With increasing focus on poor
countries…
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5. And Africa and Asia…
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6. Over 1/3 of overall AfT provided
by the EU
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7. EC Trade, Growth and
Development Communication
• Better targeted AfT
• On LDCs (only 22% of EU AfT in 2009) and
‘countries most in need’
• Improving complementatory between AfT and
broader development policies
• Targeting small and rural operators
• Improving AfT at regional level
• Better support HRs, labour rights and social
protection, sustainable development
• Enhanced effectiveness, cooperation within EU
and with emerging players Page 7

8. Regional dimension of AfT
(= 18% of tot AfT in 2009)
• Increasing attention to regional level
• International and regional banks key role
(WB, AfDB, ADB)
• Bilateral donors: the EU (France, Germany,
UK); the US; Japan…
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9. Regional challenges
• National – regional nexus
• Coordination and complementarity
• Implementation issues
• Ownership and prioritisation
• Capacity constraints
• Donors coordination
• Focus on policies and infrastructure / TF
• Multiplication of regional programmes + EPAs
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10. Sectoral challenges
• Bridging sectors:
e.g. AfT with Agriculture and rural
development / food security
• Involvement / ownership from private sector
• Access to finance
• Multiplication of fora: national, regional,
continental, international and by sector
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11. Eg. Productive capacity
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12. Innovative sources of financing
• Go beyond aid: private capital
• Leverage aid to mutiple pool of resources
• New sources and instruments:
blending (grants and loans), private-public
partnership
FDI, portfolio investment, capital markets,
private equity, sovereign funds
• Domestic resources mobilisation
• Emerging players
 Capacity challenge !!! Page 12

13. AfT and other official flows (OOF)
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14. Way forward
• Effectiveness & monitoring: show
results and learn lessons (e.g. OECD/WTO)
• Involve private sector: leverage & impact
• Connect to emerging players:
South-South Cooperation
• Address broader policy objectives & ensure
bridging/coherence:
- industrial policy, policy space,
- sustainability, inclusiveness and equity
= build synergy and complementary
• Strenghten ownership and coordination
• … Page 14

15. Thank you
San Bilal: sb@ecdpm.org
www.ecdpm.org
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