Trade Policy at Work

Aid for Trade, Regional and Global Value Chains and the Role of Trilateral Cooperation

Multi-stakeholder coordination is inherent to the Trilateral Development Cooperation model of implementing aid projects, which provides an ideal platform for regional Aid for Trade projects. It goes far beyond simple tripartite aid initiatives involving donors from developed and developing regions and recipient countries. It involves participation of a wide range of stakeholders in various capacities. In this session, the state of regional value chains in selected developing regions, particularly in South Asia, Eastern and Southern Africa and in Mercosur, and possibilities of linking them with global value chains, were explored.

Trilateral development cooperation model of implementing aid projects provides an ideal platform for advancing regional aid for trade projects and promotion of value chains, observed Pradeep S Mehta, Secretary General, CUTS International.

Speaking whilst chairing a side event organized by CUTS International Geneva and South Asia Watch on Trade, Economics and Environment (SAWTEE) as part of the Fourth WTO Global Review of Aid for Trade on 10th July, Mehta indicated that there was need to look at trilateral development cooperation beyond simple tripartite aid initiatives involving donors from developed and developing regions and recipient countries to how participation of a wide range of stakeholders in various capacities which are active in recipient countries can be galvanized and harnessed.

“A more concerted and streamlined approach is needed for promoting regional aid for trade projects by applying an ideal model of trilateral development cooperation. This should be done through greater involvement of emerging economies in the implementation including funding and knowledge sharing‘’ he said.

Dr Mohammad A Razzaque, Advisor and Head, International Cooperation, Economic Affairs Division, Commonwealth, stressed on the need to addressing regional supply chain related constraints before looking at the global value chains. He said regional capacity and supply side trade facilitation related constraints need to be identified and trilateral funding be leveraged towards addressing those constraints.

Speaking at the same event, Dr Ratnakar Adhikari, Chief Executive, South Asia Watch on Trade, Economics and Environment (SAWTEE), stressed that the constraints to regional integration were similar to the constraints for the development of the regional value chain. In view of this, he indicated that trilateral development cooperation framework should be committed towards mainstreaming of trade in the development cooperation framework.

ZHU Hong, Minister and Deputy Permanent Representative, Permanent Mission of China to the WTO in Geneva, indicated that China was firmly committed to working with nations towards shared prosperity and believed in potential of trilateral cooperation in addressing the constraints facing least and other developing countries.

He said, China, has contributed 600,000 US dollars to the WTO A4T for three consecutive years since 2008. ‘’In 2011, China also started funding an LDC Accession Assistance Programme aimed at strengthening LDCs participation in the WTO by providing 400, 000 US dollars annually”, he added.

Several issues were raised in the follow up discussion including: need of thinning the borders to facilitate regional value chains, importance of trade facilitation beyond the WTO negotiations and hence the need to work on a TF reform agenda at the national and regional levels, and improved prospects for regional integration in South Asia.

Pradeep S Mehta, in his concluding remarks, pointed out that political will is there in South Asia to work towards regional integration. However, inertia, often at the bureaucratic level, still needs to be addressed through sustained advocacy and networking.