The heart of the Doha Development Agenda is a "trade and growth"
agenda that is of central importance to helping developing
countries, and especially the least developed countries (LDCs), to
reach their Millennium Development Goals.
"Aid for Trade" is about investing in developing countries so
they can use trade as an engine for growth, development and poverty
reduction. It aims to help them build the supply-side capacity and
trade-related infrastructure that they need to be able to implement
and benefit from WTO Agreements, and more broadly, to expand their
trade.
In the past 12 months, Aid for Trade has become an important
political and economic complement to the negotiations, one that can
contribute greatly to unlocking the full growth potential of a
successful Doha round.
A factor that is complicating the conclusion of the trade
negotiations themselves is the evolving public response to
globalization in many parts of the world. Today it is not only
global income growth that matters. It is also who shares in that
growth and how. Politically, we cannot leave the question of "who
gains what?" from trade liberalization to market forces only.
We have to address concerns about adjustment costs, capacity
constraints and supply responses in developing countries and LDCs.
Where those cannot be taken care of with national resources or by
the private sector alone, we must try to build an effective
international response.
Integral to the Doha agenda
That is why Aid for Trade is essential to support the conclusion of
the Doha negotiations, and why trade ministers took the initiative
in Hong Kong to mandate me, together with a Task Force of member
governments, to produce recommendations to raise additional
financial resources that can make the Aid for Trade initiative
operational.
Aid for Trade will continue to move forward despite the
temporary suspension of negotiations. We consider a comprehensive
Aid for Trade package as both necessary in itself and an essential
part of a successful round.
WTO's role in Aid for Trade is predominantly one of advocacy for
additional resources and of enhancing coordination at the
multilateral level and, in the case of beneficiary countries, at
the domestic level. No direct development assistance role is
foreseen for the WTO.
This means advocacy, on the one hand, with trade and finance
ministers and their officials to encourage them to raise the
domestic profile of the trade and growth agenda, ensure that it is
incorporated in national development programmes and use ODA
(official development assistance) best practices when presenting
trade-related needs for international support.
It also means advocacy with finance and development ministers
and officials to encourage them to provide well-coordinated,
generous responses to trade projects, commensurate with the needs
of developing countries and LDCs.
Test for success: Better trade capacity
In our view, the test for our collective success in aiding trade
should not be limited to mainstreaming trade in national
development plans, but to increased capacity of developing
countries to translate the opportunities from market opening into
increased trade flows of goods and services.
ITC has a tried and tested role here. Its work with the private
sector is crucial in making the Doha round a beneficial one for
developing countries, by preparing business to compete
internationally.
Strengthening partnerships
I am convinced that there is a strong and broad commitment to
increasing Aid for Trade in the context of a projected increase in
ODA. We are working closely with established mechanisms - at the
bilateral, regional and multilateral levels - to help us make the
Aid for Trade initiative operational and successful. I know I can
continue to count on the support of my colleagues in the World
Bank, the International Monetary Fund and the regional development
banks.
There is a broad agreement that we cannot continue to do Aid for
Trade in the same way we have done in the past. This initiative is
not about replacing or duplicating existing mechanisms, but about
making them work more effectively, with measurable results, in a
focused manner. We are working with the Organisation for Economic
Co-operation and Development on possible ways to improve the
effectiveness of Aid for Trade, in particular through our joint
database on trade-related technical and development assistance.
A wide range of priorities needs to be met to promote regional
and global integration and to realize the developmental potential
of trade opening. Meeting these needs can only be determined by
countries themselves, working with national stakeholders,
particularly the private sector, and with their development
partners. Ownership should not just be a buzzword. It is a
precondition for making Aid for Trade effective (see Aid for Trade: We Can Do
Better).
The WTO Secretariat has already started reflecting on how to
utilize its own internal mechanisms to monitor Aid for Trade.
We must move forward on Aid for Trade, building on the momentum
that clearly exists despite the current setback in the
negotiations. Increasing Aid for Trade is not contingent on the
outcome of the Doha round, but its value will be greatly increased
if it is in conjunction with substantial new market access
opportunities and new rules to facilitate trade.