Third Global Review of Aid for Trade: Showing Results

> Pascal Lamy’s speeches


Heads of Agencies
Distinguished ladies and gentlemen

It has been an enriching two days.  We emerge from it with a strong narrative on Aid for Trade.  It is an encouraging account of how we are building trade capacity, not just for the short or medium-term, but importantly for the long‑term.  It is a narrative which flows from the engagement of an ever broader Aid for Trade community.  The heads of institutions who first joined me here in 2007, and again in 2009 and this year, have been joined by the ministers of developed, developing and south-south, by the heads of regional organizations, civil society and the private sector.  I have been impressed by the quality of analysis and debate, and I must say that this is not just a strong narrative; it is a weighty one too. 

Let me focus on the past two days and share with you my thoughts on the way forward. 

The Third Global Review has vindicated our decision to focus on showing results.  The need to firmly grasp this nettle has been foremost in my mind since our second Global Review in November 2009.  Donors have highlighted this message because of budgetary pressures.  Partners have underlined it in the context of improved accountability and transparency.  In reality, this means making accountability work for effectiveness. But regardless of the motivation, the message is the same: better accountability is here to stay. 

I am convinced that our initiative emerges stronger from this Review, and more robust for embracing accountability.  It is stronger for the results we have been able to showcase, but also for the candour with which we have debated the shortcomings of current approaches and practices; both with regard to the allocation and implementation of Aid for Trade.

We have had to strike a delicate balance between being:

  • Encouraging, but not self-congratulatory;  and yet being
  • Realistic, but not disheartening.

Overall, I think we have got it about right.  Yes, we have results to show.  But we must also recognize the need to improve practices.  And strengthen our confidence in the way in which we report on progress. 

The UN Secretary-General's inspirational words this morning underline the task we have ahead of us.  I was particularly struck by his insight that Aid for Trade is “transcending artificial boundaries”.  He called on us to extend the same logic to ensure broader coherence with sustainable development. We need to recognize the intersections of the initiative with this wider agenda, whilst remaining true to the mandate we have. 

We need to listen to the development community and make the case why trade is important for economic growth.  We can do a better job of explaining why Aid for Trade can support broader policy objectives like poverty alleviation, social welfare, food security, gender empowerment, climate change adaptation, energy generation and sustainable development.  In so doing, we will be promoting deeper coherence within the initiative and with the broader international context. 

Equally, though we must not lose sight of the fact that in making the case for Aid for Trade, we are really making the argument for the multilateral trading system.  Aid for Trade is all about logging onto this world-wide trading system.   And this means understanding the role that intellectual property, services, and standards can play; all areas where we have multilateral agreements in place. 

This should be the central theme of our forthcoming work programme.  In my closing statement in 2009, I stated that Aid for Trade was “coherence in action”.  In 2011, I want to make the case for “Deepening coherence”. 

In 2009, we came together at the height of economic crisis.   Nowhere was this crisis more evident than in the collapsing market for trade finance.  We held a media event to launch the Global Trade Liquidity Programme.  That programme has now disbursed $1.8 billion in funding.  And over the past two days, we have heard of the success of the efforts which all of you have undertaken on this issue.  But we are not out of the woods yet.  While liquidity has returned to the markets, longer term structural issues have become more apparent.  Access is now the challenge, not availability, particularly in Africa.  And here we could do with some of the innovative thinking that we have heard yesterday and today.  

When asking for indicators for Aid for Trade which track poverty reduction and other objectives, the development community is really asking us to hold a mirror to the multilateral system; inviting us to examine the image in front of us.  This is about more than the development effects of Aid for Trade; it goes to the core of our arguments on the development benefits of the multilateral trading system.  It speaks to why the DDA is a development round. 

In moving monitoring and evaluation forward, in my view, we must remember that we are also examining progress towards the achievement of the development goals of our Members and their regional organizations. This means not only engaging partner countries and regional bodies in this process; it means they should own it.   This is a point which shone through very clearly through the event.  We must take monitoring and evaluation down to that level. We must feed it into our global work.  In short, we must apply the Paris principles of country ownership to evaluation and impact assessment. Evaluation is a challenge which has climbed the political agenda given the pressure on budgets at our back.  But we must strike an appropriate balance with long-term aspiration. To see the cause and effect we seek, we have to be realistic about our timeframes.   

It also implies that we should:

  • Redouble our efforts with the OECD to develop a menu of meaningful performance indicators which partners and donors alike can use for planning and implementation; 
  • Explore new techniques like impact evaluation and bolster the results-based management approach;
  • Draw more fully on on-going results measurement efforts, and do more to learn and work with each other between regions.  I particularly appreciate that the African and Asian Development Banks are working together on trade finance;

At the same time we should not allow a focus on results to get in the way of implementation.  Cost-benefit analysis is useful, but it comes at a price.  Furthermore, we should avoid creating the impression that what we did not measure, did not work.   Let’s not make a vice of virtue.  We need to get better at showing results, not obsessive about finding them.  Monitoring and evaluation is an important element, one we have perhaps neglected in the past, but it should be one element of our new work programme.

So let me highlight what I think should be the themes addressed by the future work programme:

  • Resource mobilization: This was really the focus of our efforts from Hong Kong through to the Second Global Review in 2009.  It must remain central.  And here I fully hope to be able to build on and continue our excellent working relations with the G-20.  The Seoul commitment to maintain Aid for Trade resources at 2006-2008 levels is a good insurance policy to have. And as many of you have highlighted it should also be more equitable and respectful of the particular challenges which many Members in this room face. 
  • Leveraging other sources of finance:  We should also make better use of the resources we have by examining innovative ways of leveraging additional financing.  We must sustain the thrust on ensuring adequate trade finance.  At the same time, as we heard this morning, we need to look at innovative financial instruments that would allow Aid for Trade to tap financial markets in search of local assets beyond the traditional international concessional funding. 
  • Mainstreaming.  Comments by Ministers and other interventions both from the Panel and the floor, as well as the excellent UNDP side-event, highlight the tangible progress we have made in bringing trade into national and regional planning frameworks.  Promoting bottom up coherence.  But this is not a one-off process.  Plans are updated, governments change, priorities shift; keeping trade at the heart of these frameworks and operational plans is a continuous challenge.  It is a challenge for Members at all levels of development, LDCs and non-LDCs alike.  We need to consider how we can support this process across our developing country members.
  • Engaging the private sector. This is the Third Global Review, but the first with genuine private sector participation. The quality of yesterday's panel discussions highlights the benefit of bringing the private sector more into the Initiative - and redoubling our efforts to engage them on the ground.  It is clear that Aid for Trade's primary function must be to prepare the ground for the private sector to grow, not just within, but also beyond its own borders.  We must also remember that it's not development agencies that sell into global value chains.  It's business.  They are the ones who will ensure that our trade development projects do indeed develop trade that lasts after the end of the project.   That we get the conditions right on the ground. But getting the private sector on-board also means understanding that in reality “Aid for Trade” is as much the need to generate “Investments for Trade”. 
  • I think we need to put the aid effectiveness agenda more centrally in the Aid for Trade Initiative.  This is about addressing concerns about effective and timely implementation and getting serious about measuring the impacts of our interventions.  This is a something to which I am happy to personally commit to undertake when I attend the 4th High Level Forum on Aid Effectiveness in Busan, Korea in November this year where we will also explore the role of Aid for Trade in leveraging other forms of development finance. 
  • Exploring the intersections of Aid for Trade with other agenda.  In my opening remarks, I gave the analogy of the office printer.  I am also the Director-General who wants to create a paperless Secretariat.  We should heed the UN Secretary-General's call to coherence with the broader sustainable development agenda.   My view is that a work programme centred on deepening coherence will give us this flexibility to meet this challenge, whilst we remaining true to our core mandate.
  • Taking South-South co-operation to a higher level.  We have a good record to show.  But more can be done in knowledge transfer and in sharing skills.
  • Finally, Regional Integration, which emerged in all sessions as area of success and on-going challenge.  It should feature prominently again in our forthcoming work programme.  And support to the work of the regional development banks.

Since we are on the issue of regional integration, this is perhaps the perfect moment to bring in the launch of the World Trade Report tomorrow.  Bilateral and regional trade agreements are growing in number, but also in complexity.  This reflects the changing structure of global production - an issue discussed in the past two days.  This evolution requires a rethink of the traditional way in which we analyse preferential trade agreements.  Such deep integration schemes pose a different challenge to the multilateral trading system that policymakers must learn how to successfully navigate.  This is an issue we shall discuss in more detail tomorrow and need to factor into our new work programme on Aid for Trade, which I fully expect to be ready in time for the WTO Ministerial Conference at the end of the year. 

Before we close, let me pay a specific tribute to our WTO Secretariat Aid for Trade team. A formidable one. What I mean by formidable is not their headcount. Not more that the five fingers of my right hand. What I mean by formidable is their dedication, brain power, and capacity to listen, liaise and report.

Starting with Valentine Rugwabiza which I understand some of you have nicknamed “lady Aid for Trade”. Since 2005 she has put to the service of this initiative her vast experience, her deep understanding of the realities on the ground, her special human touch and her well known perseverance. She has supervised a group composed of Shishir Priyadarshi, Michael Roberts, Matthew Wilson, Debbie Barker and the team of secretaries in the development division and the many other hands across the Secretariat that have made this event work for you. In this case, I will make an exception to my rule of not mentioning my own team, Arancha Gonzalez, Joshua Setipa and Susan Conn.

I believe they all deserve your applause.
In closing, let me leave you with a visual image:

  • When I became DG in 2005, the IF focal point of a West African country would always bring my staff a box of mangoes;
  • Now he brings mangoes as well as mango jams and mangoes chips when he visits my office.

What better image with which to leave you with about the transformative power of Aid for Trade — about using Aid for Trade to unlock the trade potential and move up the value chain. 

Let's now keep working with the Fourth Aid for Trade Review in mind, two years from now. My hope is that, by then, we will have made one more step in making trade opening work for development.

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