Aid for Trade for SPECA Countries Jean-Jacques Hallaert Senior Trade Policy Analyst Trade and Agriculture Directorate, OECD Ministerial Conference “Aid for Trade Roadmap for SPECA” Baku, Azerbaijan December1-2, 2010

What is the OECD involvement? Promote coherence between aid and trade An important contribution of the OECD Aid for Trade at a glance reports Using the Creditor Reporting System (CRS) AfT data can be extracted online The focus of this presentation 2) Enhance donor co-ordination and alignment 3) Maximize aid effectiveness Monitor aid-for-trade flows & commitments

Monitoring Aid for Trade DEMAND RESPONSE OUTCOME IMPACT Partner country assessment i.e. Questionnaires Donor assessment and Trade performance Economic growth Poverty reduction Development indicators OECD/CRS Case stories Case stories

AfT commitments reached USD 41.7 bn. in 2008 Source: OECD/CRS (millions of 2008 US$)

Asia is the largest recipient… 2008: + USD 5.3 bn

…but is SPECA marginalized ? DISBURSEMENTS SPECA countries: less than 5% percent of global flows. Excluding Afghanistan: only 1.4%. COMMITMENTS A risk: the marginalization of the region. In real terms, Aid for Trade increased in 2008 by: +35% World +40% Asia +8% only for SPECA AND declined by 16% for the region if Afghanistan is excluded.

Donors priority Source: 2009 DAC REPORT ON AID PREDICTABILITY

Aid for Trade in SPECA (1)

Aid for Trade in SPECA (2) SPECA countries attract 5% of global AfT flows (2002-2008) o/w Afghanistan = 3% Is it a good performance? AFT per capita (2002-2008 in 2008 USD) Different metrics can be used AFT per capita is one of them SPECA as a region is rather successful Only Turkmenistan (2$) and Uzbekistan (10$) receive less than world average SPECA (all) 70 SPECA (excl. AFG) 29 ________________________ ALL recipient countries 26 ALL (excluding SPECA) 25 But is this Aid effective? Does it meet the needs? Does it target the most binding constraints to trade expansion?

What did AfT to SPECA finance? (1)

Sectoral allocation: what did AfT to SPECA finance? (2)

Looking forward: Donors’ commitments

What can be done to attract more AfT? The logic of AfT Initiative Starts with partners’ demand. Donors committed to respond (alignment) Demand is crucial Need to mainstream trade in development strategy Let the donor community know The Roadmap is very important Answer the OECD/WTO questionnaires and case stories Very high profile Will be part of the AFT at a glance 2011 Centrepiece of the WTO Global Review on AFT in July 2011 where all donors (and more) will gather. Partner country Donors DEMAND RESPONSE

Conclusions SPECA as a region is rather successful in attracting AFT despite substantial differences across countries. But there is a risk of marginalization. And there is scope to increase inflows of AfT. This requires Mainstreaming trade in development strategy Letting the world know what the region’s needs are: The AfT Roadmap is a crucial step Answer the OECD/WTO questionnaires and submit case stories This will help orient donor support Where it is needed And increase its effectiveness i.e. its impact.

Further information Questionnaires: www.oecd.org/dac/aft/questionnaire Case stories: www.oecd.org/dac/aft/casestories Aid for Trade in 2008: http://www.oecd.org/dataoecd/45/17/45468870.pdf Aid for Trade Statistical Queries: http://www.oecd.org/document/21/0,3343,en_2649_34665_43230357_1_1_1_1,00.html OECD/WTO: “Aid for Trade at a Glance 2009”: http://www.oecd.org/document/56/0,3343,en_2649_34665_42835064_1_1_1_1,00.html#statistics Aid for Trade web page: www.oecd.org/dac/trade/aft “Binding Constraints to Trade Expansion: Aid for Trade Objectives and Diagnostic Tools” (OECD Trade Policy Working Paper #94): http://papers.ssrn.com/sol3/cf_dev/AbsByAuth.cfm?per_id=546100 http://www.olis.oecd.org/olis/2009doc.nsf/LinkTo/NT0000701E/$FILE/JT03275544.PDF “Increasing the Impact of Trade Expansion on Growth: Lessons from Trade Reforms for the Design of Aid for Trade” (OECD Trade Policy Working Paper #100): http://www.oecd.org/officialdocuments/displaydocumentpdf/?cote=com/dcd/tad(2010)4/final&doclanguage=en