UNDP takes the view that international trade can play an important role in raising levels of human development and achieving sustainable poverty reduction. From this perspective, trade is a means to an end, not an end in itself. Properly harnessed, international trade can create opportunities for growth, poverty reduction and human development through for example: Expanding markets: exports allow an economy to overcome the constraints of its domestic market;Raising productivity: increased returns to scale in production resulting from access to international markets; andAccelerated technological development: from increased exposure to new technologies and knowledge. However, none of this is automatic or inevitable. Appropriate policies are also required across several fronts and sectors. UNDP’s trade-related support has three main objectives:(i) To help developing countries build capacity to compete internationally by overcoming supply side constraints;(ii) To help developing countries build capacity to negotiate, interpret and implement trade agreements (multilateral, regional and bilateral) in a manner that prioritizes poverty reduction and human development; and(iii) To help developing countries incorporate pro-poor, development-centered trade policies into national development strategies, including poverty reduction programmes.
Background – Ministerial Meeting
The second focus area, cross-border cooperation, would have two main components: the physical and the institutional trade infrastructure and would include both cooperation among the SPECA countries and between SPECA countries and their (other) neighbours. In trade-related physical infrastructure development, cross-border cooperation may include joint projects (with two or more countries as partners) for the construction of works like roads, railways, oil and gas pipelines, electricity transmission lines, and irrigation canals. However, irrespective of how a particular infrastructure is financed and managed, cross-border cooperation is key for ensuring that major infrastructure investments are made with due consideration of the needs, interests and resources of all the countries concerned. Considerable savings in construction, maintenance and operation costs could be achieved if transport links within and between the SPECA countries were allowed to follow the most economic routes, as dictated by topography and the potential for trade development, rather than by the way borders have been traced. Similar considerations also speak for close cooperation on the design, capacity and management of facilities for electricity generation and irrigation, and the proper costing and pricing of inputs and outputs, so that demand in the region can be met at minimum cost. Addressing these aspects properly and at an early stage would help obtain financing, minimise costs and maximise benefits, and thereby secure the long-term success of physical infrastructure investment. Enhanced information exchange, regular consultations and harmonised planning of major investments across the region would, therefore, be important to launch at an early stage of cross-border cooperation on physical infrastructure in the Aid-for-Trade context and to maintain, as a key element, throughout the preparation and implementation of physical investment programmes. Cross-border cooperation in institutional infrastructure development complements physical investment as well as efforts to improve the business environment. This component would address a number of key issues for developing overall international trade and particularly between neighbouring countries in the region and with the region’s neighbours. The focus would be trade facilitation, i.e., the harmonisation and simplification of rules, procedures and practices for trade across the borders and their formalisation, where appropriate, through corresponding agreements, whether bilateral or multilateral. This could include, for instance, the exchange of customs related information and the mutual recognition of certificates, inspection reports and the like, so as to minimise the number, the time and the cost of interventions by authorities in the process and, thereby, facilitate the ability of the business community to profitably engage in mutually beneficial trade. Evidently, conformity with international practice would be of paramount importance, in particular as this may also be required for WTO accession. The important role of transit through and between the SPECA countries would need to be kept in mind; depending on the circumstances, facilitating transit may require adhesion to, or improved application of international agreements like the TIR convention, or the preparation of agreements specific to the region but in accordance with best international practice.
Aid for Trade in Central Asia, South Caucasus, and Western CIS
Wider Europe:<br />Aid for Trade in Central Asia, South Caucasus, and Western CIS<br />Border Management CoP<br />19th July 2011<br />United Nations Development Programme <br />
UNDP’s vision on trade<br />Supporting the link between human development and trade<br />UNDP’s focus:<br />To help developing countries build capacity to compete internationally by overcoming supply side constraints;<br />To help developing countries build capacity to negotiate, interpret and implement trade agreements (multilateral, regional and bilateral) in a manner that prioritizes poverty reduction and human development; and<br />To help developing countries incorporate pro-poor, development-centered trade policies into national development strategies, including poverty reduction programmes.<br />
Fast Facts<br />Phase I: <br /><ul><li>Implementation duration: 18 months (Aug 09’ - Jan 11’)
Aid for Trade Needs Assessments under phase I<br />Development of Aid for Trade Needs Assessments in 11 countries in Central Asia, South Caucasus and Western CIS:<br />Objectives:<br /><ul><li>Identification of capacity gaps (institutional, human, etc.) and technical assistance needs;
Development of policy recommendations and action matrix for potential donor assistance;
Development of concrete project proposals for AfT interventions.</li></li></ul><li>The SPECA AfT Ministerial Meeting<br />Border management can have a dramatic impact on trade;<br />To have an impact, trade facilitation measures on one side of a border will have to be matched by corresponding measures on the other side – cooperation remains key;<br />Despite large and long term projects creating trade corridors in Central Asia – the network is still hampered by slow processes at the borders;<br />
Continued<br />Although tariffs have become mostly insignificant as obstacles to trade between SPECA countries, several non-tariff barriers remain:<br />Regulations of sanitary and phyto-sanitary measures;<br />Mutual recognition of inspection and testing results between countries in the region is poorly developed/implemented.<br />Lack of coordination between inspection bodies;<br />Technical barriers to trade;<br />Number of rules, procedures and documents needed for import and exports;<br />Variability and uncertainty in the implementation of the rules and regulations (judgement calls);<br />Disproportionally high trade costs.<br />
Some info from the CAREC institute<br />Source: CAREC CPMM 2009-2010<br />
The harmonisation challenge<br />In order to facilitate cross-border trade :<br />Individuals need to be able to easily cross borders without having to pay a bribe;<br />It is necessary to reduce trade costs through better and faster procedures at the border for both customs and border agencies;<br />Private sector needs to be involved in the harmonisation and improvement<br />Why is this important:<br />Cross border trade (including informal) is a vital part in Central Asian economies and has a substantial impact on human development.<br />Trade (not considering oil and gas) in Central Asia is below its potential > high trade costs discourage;<br />Trade, especially if it benefits small producers, can have an important impact for human development.<br />
The SPECA AfT Ministerial Declaration<br />On the basis of the Aid for Trade Needs Assessments undertaken in SPECA countries the following areas were considered as critical by member states and adopted as focus areas in the Ministerial Declaration:<br />Supply side/within-border measures; <br />Cross-border cooperation;<br />The multilateral trading system .<br />Cross- border cooperation:<br />Physical infrastructure;<br />Institutional trade infrastructure, with a focus on trade facilitation;<br />Market access.<br />
Focus of the Aid for Trade project<br />Trade Capacity<br />Building<br />Access to markets<br />To enhance private sector’s trade-related capacity<br />Eco-Friendly Technologies and Green commodity <br />Access to<br />information<br />
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