Despite some shortcomings, the Integrated Framework for
Trade-Related Technical Assistance for Least Developed Countries
(IF) is recognized as a sound basis for trade capacity building and
coordination among assistance providers.
First mandated at the 1996 WTO Singapore Ministerial Conference
and subsequently endorsed at a High-Level Meeting on least
developed countries (LDCs) in October 1997, the IF has been at the
heart of the Action Plan for LDCs to help these countries
participate more effectively in the world trading system.
The IF process was revamped in 2000. As a result, a diagnostic
tool for trade development is now part of the process. The IF has
also been integrated within the structure for Poverty Reduction
Strategies.
By the end of 2006, Diagnostic Trade Integration Studies (DTIS)
and national validation workshops will have been completed for 24
countries. Another nine countries are either starting or in the
process of drafting their trade studies and ten countries have a
technical review under consideration.
What are the recognized ingredients of success? At a
minimum:
- A coherent trade strategy that is closely integrated with a
country's overall development strategy.
- Effective mechanisms for intra-governmental policy
coordination, for consultation among the three key sets of
stakeholders: government, the business sector and civil
society.
- A network of trade support institutions.
In addition, the IF process should be anchored by firm country
ownership and be backed by strong political commitment.
First lesson: Country ownership and coherence
The government must be able to provide the right leadership when
both formulating and implementing trade development policies.
Throughout the entire process, the political commitment, support
and participation of the country's top decision-makers are needed -
from preparation to successful completion of the diagnostic study,
to the implementation of the technical assistance matrix, to
integration of pro-poor trade policies and programmes in the key
document, the Poverty Reduction Strategy Paper (PRSP), and, for
some countries, to their successful accession to the WTO.
- Tap into local knowledge. The
government has an important role as the local partner. Its
contribution, in the form of time and local knowledge, is crucial.
More often than not, technical missions have been comprised of
highly qualified international consultants, most of whom
regrettably had never been in the countries they were supposed to
advise and thus lacked insight into the local realities.
- Reconcile trade and development
cultures. Mainstreaming trade into development
policies is difficult without a coherent policy framework.
Ultimately, mainstreaming trade means giving greater visibility to
linkages between trade and other related economic policy areas.
Capacity building provided to the government should aim at helping
it reconcile two distinct cultures, namely, trade and development.
Trade involves highly centralized, legal negotiation and
implementation of WTO and other trade agreements. Development is
decentralized and demand-driven, and based on a country-owned
process. Development culture supports a host of complementary
policy reforms outside the purview of the WTO and costly
investments in trade-related institutions, infrastructure and human
resources.
- Coordinate the role of finance.
Financing is also critical in mainstreaming efforts. Without it,
efforts to mainstream trade will dissipate. Over the long term
there is a need to develop and consolidate mutually supportive
policies that connect trade, development and finance communities.
This requires effective coordination across government institutions
and development partners (donors and agencies), as well as
partnership between the government and private sector participants
in the economy.
Second lesson: A multi-level partnership
Partnerships are important; trade matters to so many different
groups that they all need to be involved.
Achieving support from all key stakeholders - government
policy-makers, bureaucrats, business sector actors, development
partners and civil society - requires an inclusive process that
engages the stakeholders all along the various stages of the
cycle.
- Consultation is easier said than
done. Identifying key issues and broad approaches to
trade-sector strategy is not necessarily the most difficult part of
the exercise. What is more demanding is to create a plan of action
that is the result of a true process of consultation among all
stakeholders, one in which each partner is able to contribute ideas
and inputs.
- Bring in business. Institutionalizing
systematic consultations between private and public sector
institutions can have positive, long-term effects. Private
enterprises are well placed to identify trade-related problems and
bottlenecks.
Capacity building for the business community, many of whom work
with trade support institutions, has proven critical. Trade support
institutions, through their access to government decision-makers
and their active participation in coordination meetings with the
government, can ensure that constraints faced by private
enterprises are understood and taken into consideration when
designing a coherent development strategy. At the same time, trade
support institutions can ensure that authorities draw on the
untapped resources and potentialities of the private sector as
appropriate.
- A role for NGOs. In recent years,
civil society organizations have been very active in shaping the
trade development process despite the lack of a formal dialogue
mechanism. Apart from contributing to negotiating positions and
supporting (technically and financially) specific trade events,
NGOs are shedding their adversarial skin. They have gradually
earned the respect of former opponents in society and
government.
Third lesson: Bridge demand and response
The third lesson from successful IF initiatives is the need for a
solid implementation mechanism championed by a focal point and
supported by a dedicated core team. Resources are needed to
strengthen the capacity of the focal point to drive the process,
including the creation of a national implementation unit and the
provision of both secretariat resources and adequate
capacity-building support in trade-related issues.
What is the Integrated Framework?
The Integrated Framework of Trade-Related Technical Assistance
is an international initiative in which six agencies dealing with
trade (International Monetary Fund, ITC, UNCTAD, United Nations
Development Programme, World Bank and WTO) coordinate their efforts
with donors and least developed countries to respond to LDCs' trade
development needs.
Most LDCs are part of this process (43 out of 50).
The Integrated Framework is being "enhanced" as part of the Aid
for Trade process and could serve as a model for other aid for
trade initiatives.
WTO agreed to make the Enhanced Integrated Framework operational
by the end of 2006.
Siphana Sok (sok@intracen.org) is Director of
ITC's Division of Technical Cooperation Coordination.