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Dialogue on The Future of Aid for Trade

A two-day international dialogue on The Future of Aid for Trade was  organized from 22-23 November 2012 at the World Trade Organization (WTO), Geneva by International Centre for Trade and Sustainable(ICTSD) and Ministry of Foreign Affairs of Finland in collaboration with South Asia Watch on Trade, Economics and Environment (SAWTEE), World Bank and other organizations. The dialogue ended with a call for instituting a mechanism to evaluate the effectiveness of the Aid for Trade initiative at the country level.

Making his opening remarks, Ricardo Melendez-Ortiz, Chief Executive Officer of ICTSD mentioned that one of the objectives of the dialogue is to feed the findings studies that have been conducted in various countries in Asia, Africa and the Americas to the Fourth Global Review on Aid for Trade taking place in Geneva in 2013.  During the dialogue Mr. Sigfrido Lee, Vice minister of economy of Guatemala emphasized the role of private sector in harnessing the potential of aid for trade because according to him “they are the primary stakeholders of the initiative”.

Ambassador of Nepal to the United Nations H.E. Shanker Bairagi mentioned that aid for trade is also plagued by the same asymmetric power relationship that has plagued traditional ODA. “We need to take partnership issue seriously so as to ensure that aid for trade delivers on its promises”, he suggested. He further added that the issue of absorptive capacity needs to be tackled upfront in order to see the kind of change trade and development community are envisaging.

Dr. Ratnakar Adhikari, Chief Executive Director of SAWTEE emphasized the need for addressing supply side constraints in order to enable South Asian least developed countries such as Nepal and Bangladesh enhance their export potential. “However, the study conducted in the region shows that this is not happening because of a confluence of factor, including apathy of donors and the partner countries towards taking the Aid for Trade Task Force Report seriously”, he added. He was of the view that aid for trade should be taken as an entitlement rather than a charity.

Mr. Frans Lammersen, Principle Administrator, development cooperation directorate, OECD suggested that aid for trade, which roughly represents a third of total official development assistance (ODA), has done relatively better than any other type of assistance. He, however, warned that aid for trade may decline in the near future because of on-going debt crisis, among others.Delivering her closing remarks ambassador of Finland to Geneva H.E Paivi Kairamo said that we should not lose sight of the big picture, which is the role that aid for trade could play in creating employment opportunities and alleviating poverty without compromising with the overall objective of promoting sustainable development.

More than 80 people representing various governments, inter-governmental organizations, non-governmental organizations, private sector and academia participated at the event.