UNDP Engagement in Trade and Development: An Update Presentation to the Strategic Management Team (SMT) 3 October 2005 Bureau for Development Policy

3 October 2005Bureau for Development Policy2 Structure of the Presentation 1.Overview of UNDP interventions in Trade and Development 2.The Integrated Framework Trust Fund (IFTF) 3.Scaling Up Aid for Trade and Some Implications of an Enhanced IFTF

3 October 2005Bureau for Development Policy3 Capacity Development for Trade  The July 2004 SMT-endorsed developing country needs have been prioritized: 1.Capacity to compete internationally by overcoming supply-side bottlenecks (especially LDCs) 2.Capacity to negotiate, interpret and implement trade agreements (multilateral, regional and bilateral) which prioritize poverty and human development (HD) concerns 3.Capacity to incorporate pro-poor, development centered trade policy in national development strategies (including PRSPs)

3 October 2005Bureau for Development Policy4 Global Initiatives  Integrated Framework for Trade Related Technical Assistance for the LDCs (IF): Focus on national institutional and human resource constraints in LDCs UNDP: Trust Fund manager and lead agency for Window II (Capacity Development) Total Fund ( ) as of Sept. 30, 2005:  approx. $35m pledged  approx. $33m received

3 October 2005Bureau for Development Policy5 Global Initiatives  TRIPS and Access to HIV/AIDS Drugs Programme: BDP Poverty Reduction and HIV/AIDS Groups Joint Cross-Practice Attempt to operationalize 2001 Doha Ministerial Declaration on TRIPS and Public Health through South-South modality  ACP Capacity Building Programme – in collaboration with UNDP Brussels: To support ACP states in EPA negotiations with EU, ensuring WTO consistency

3 October 2005Bureau for Development Policy6 Regional Initiatives  Asia-Pacific Trade and Investment Initiative (APTII): Seeks to strengthen developing country policy analysis skills and capacity from HD perspective Phase I ( ): approx. 50 “technical support documents” in 10 thematic/sectoral areas Phase II ( ): emphasis on trade policy issues. Ongoing collaboration on Regional HDR on Trade and Human Poverty (to be released in first half of 2006) with inputs from Phase I

3 October 2005Bureau for Development Policy7 Regional Initiatives  Africa Trade, Poverty Reduction and HD Programme: Approved for period Focus on strengthening both national trade policy and international trade negotiations, incl. through increased trade-human development analysis  Arab States Trade, Economic Governance and HD Programme: Strengthen poverty reduction and human development outcomes of trade policy and trade negotiations in Arab States Close to finalization. Expected to be approved in October 2005 for 2 years

3 October 2005Bureau for Development Policy8 Country-Based Intra-Regional Initiatives  Cushioning MFA Expiration Impact: Now Part of APTII - Phase II. Substantive design and fundraising led by BDP Focus on 4 LDCs - Bangladesh, Cambodia, Laos and Nepal Assistance in efforts to cushion the negative impact of MFA expiration on their textiles and clothing (T&C) exports, strengthen value addition and export diversification  Fiscal Implications of Trade Liberalization: Substantive design led by BDP, funded by RBAP as part of APTII – Phase II Focus on LDCs in Asia Pacific Analysis of the fiscal implications of trade reform for the design of pro-poor development strategies and the MDGs

3 October 2005Bureau for Development Policy9 UNDP Capacity in Trade and Human Development  UNDP’s own capacity in trade and HD issues continues to grow in response to: Increasing demand from UNDP COs, developing country governments and parliaments Responsibility of being IF Trust Fund Manager and lead agency for IF’s Window II on capacity development  In addition to existing SURF/Regional Center Trade Advisers and HQ based BDP staff, BDP has established a Trade and HD Unit, as part of the UNDP Geneva Office in third qtr 2004

3 October 2005Bureau for Development Policy10 The Integrated Framework  Window I: Diagnostic Trade Integration Studies  DTIS completed in 15 countries  DTIS validation workshops planned in 6 countries  DTIS under preparation in 7 countries  Window II: Capacity Development

3 October 2005Bureau for Development Policy11 The Integrated Framework Trust Fund  Status as of 30 Sept Funds Pledged (in $ million): TOTALWindow IIWindow I Funds Transferred: Funds Disbursed for Projects: Balance:

3 October 2005Bureau for Development Policy12 Scaling Up Aid for Trade  Linked to Doha Development Round and achievement of MDGs (esp. Goal 8) Millennium Project Report; UN SG Report for Sept. Summit July G8 Gleneagles Meeting September 25 World Bank-IMF Development Committee Communiqué  endorsed proposal for an “enhanced IF, including expanding its resources and scope and making it more effective”

3 October 2005Bureau for Development Policy13 Scaling Up Aid for Trade  IF Trust Fund could plausibly increase from current $30m up to $ 150 m over next few years:  from current one-time support of $1m per country for Window II to $ 3m per country for all 50 LDCs

3 October 2005Bureau for Development Policy14 Scaling Up the IFTF: Implications for UNDP  Need for an early meeting of the six IF Agencies, key donors and LDCs at Senior Officials level (now planned for Nov.7, under UNDP Administrator’s leadership): To discuss operational implications of an enhanced IFTF, if it materializes, and agree on common understanding on how to deal with existing IF problems and way forward  Need for enhanced UNDP internal capacity and resources Thank you