Forum for the Future of Aid - Trade

Un Nuevo marco regional

Fri, 10 Oct 2008 17:21:54 +0100

By Alberto Croce, Fundación SES

A menudo escuchamos y hablamos acerca de que América Latina está viviendo una etapa nueva que permite esperar un proceso de integración auspicioso, esperado y soñado por muchos desde hace muchas décadas. Por otra parte, también es necesario advertir que esto está surcado por múltiples contradicciones. ¿Qué hay detrás de este proceso? ¿Cuánto se asemeja al sueño de integración de la “Patria Grande”? ¿Dónde es posible advertir mayores avances? ¿Cómo identificar mejor las contradicciones y cómo enfrentarlas? Son preguntas tan difíciles como necesarias de intentar responder.
El presente artículo hace una revisión los temas más acuciantes que atraviesan la región en materia de integración, como ser la producción de materias primas básicas, superávits y estrategias financieras regionales, la carga de la deuda, las nuevas tendencias políticas, el tema migratorio, los movimientos sociales, etc.

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OMC: Una ronda para el desarrollo… ¿de los países en desarrollo? ¿O de quién?

Tue, 16 Sep 2008 17:58:39 +0100

Autor: Oriana Suárez, LATINIDADD

Desde 2001 se inició la Ronda Doha que tenía como uno de los objetivos convertirse en “la ronda del desarrollo”, para conseguir beneficios para los países más pobres. Los países desarrollados (PD) consideraron que la mejor manera de apoyar a los países en desarrollo (PED) era generar mecanismos para un comercio mundial más libre al que tuvieran acceso. Sin embargo, la Ronda lleva estancada varios años porque no ha logrado conciliar los intereses de los países industrializados y los países en desarrollo.
El aparente fracaso de la ronda de Doha evidencia una reconfiguración de poderes mundiales, con EEUU y la Unión Europea por un lado, y la aparición de las economías emergentes que han logrado un contrapeso a los intereses del norte, en pos de incorporar en algo las necesidades del sur.
El presente articulo hace un repaso del desenvolvimiento de las negociaciones hasta la fecha, haciendo hincapié en la falta de interés en concensuar y la falta de voluntad para que esta sea efectivamente una ronda para los PED.

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Development package at the WTO? What do developing countries want from the Doha round?

Tue, 16 Sep 2008 16:20:55 +0100

By Sheila Page, Massimiliano Calì and Dirk Willem te Velde

[Introduction]:The idea of what a minimum level for a ‘development package’ implies has been evolving throughout the Doha round, following the interaction between the different negotiating positions. Almost every country has today a definition of its own specific interests in the trading system. The old model of developing countries led by a few major countries or outside advisers no long holds. As the latest ‘final negotiations’ begin, this paper aims to summarise which of the issues still under negotiation are priorities for different developing countries. From the beginning of the negotiations, it has been clear that (as it was in the Uruguay Round) different developing countries have different priorities, and in some cases that the aims are directly opposed. Some groups have emerged which normally work together and present a common position. This paper therefore aims to summarise the interests of different developing country groups in each of the most important negotiating issues at this stage of the negotiations. This is a complex and imperfect exercise, but it provides a snapshot of the current constraints to the completion of a round which would need to be overcome in order to meet the interests of the various developing country groups.

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Good intentions aren’t enough (disponible también en Español)

Tue, 12 Aug 2008 15:14:38 +0100

By Javier Gomez Aguilar and Juan Luis Espada Vedia

Just over six years since this Monterrey Consensus (MC), only weak and limited results have been achieved, given that the Millennium Development Goals are far from being reached by 2010 and that the financial fragility and vulnerability of our countries has again been brought to light in the last few years. This is made even more notorious due to the economic disturbances generated by the bigger world economies. Within this framework, it is important to note that the MC actions are not based on principals or axes which differ from the current development model. Neither does the mobility of resources that the MC promotes prioritize the financial strengthening of our States for their autonomous management. Rather they aim to generate conditions so as these States are receptors of transnational capital and that the “goodness” of international trade only deepens economic and social concentration and differentiation.
This article explores the economic model in Latin America and the mechanism for the mobilization of internal resource and international financial resources. It also presents critics and recommendations around issues related with International Aid, Debt, International trade and the Reform of the international financial system.

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Policy Coherence: Aid, Trade and Investment

Thu, 14 Feb 2008 10:37:44 +0000

by Ademola Oyejide

The paper provides a southern perspective on what constitutes policy coherence within and between the areas of aid, trade and investment; and on what needs to be done, especially by the north, when incoherent policies undermine development. The paper was produced for the Southern Perspectives research project

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Policy Coherence: Aid, Trade and Investment

Fri, 02 Nov 2007 15:25:40 +0000

Source: North South Institute

In principle aid is used to assist low-income countries evolve an appropriate mix of policies and institutions to support their development goals. The efficiency and effectiveness of this process could be enhanced by increased coherence within and across the aid, trade, and investment policies which feature prominently in the donor-recipient relationship. Policy coherence exists when the gap between policy intent and outcome is minimized by using mutually supportive approaches in related policy areas in pursuit of a common goal. Policy coherence is naturally more complicated where national policy is significantly influenced by policy-making at the supranational level. In this case policy coherence requires harmonization through international cooperation around jointly determined and voluntarily accepted common norms and approaches.

Central to the aid relationship is a common understanding of development as societal transformation for the purpose of enhancing the abilities of all members of the society to shape their own lives. In this context, the goals of development combine income growth with poverty eradication and human development, while the “drivers” of development include macroeconomic stability, openness, good governance, quality infrastructure and strong institutions. Among these, openness and institutions are the most contentious and constitute the main sources of policy incoherence. In both cases, no general consensus has emerged regarding the best approaches, the adjustment processes and time paths for generating sustainable growth through policy and institutional reforms.

The aid relationship presumes an understanding that both sides share a common interest in achieving certain development objectives. It is characterized, however, by policy coherence issues arising from ineffective partnership and collaboration which in turn reflect donor prescription of policy and institutional reforms considered unacceptable by recipients, and unwillingness by donors to accept experimentation in these reform areas. Similarly, standard donor prescription that trade openness enhances growth and poverty reduction often clashes with recipient-country perspectives that are more nuanced because in low-income countries supply response capacity is typically limited, the adjustment process is slow and, hence, the expected efficiency gains are limited and/or delayed while up-front costs of liberalization are real and can be substantive. Finally, with regard to investment policy where donors have tended to push aid recipients towards full liberalization, the latter seem to prefer a two-track approach which promotes export-oriented foreign direct investment (FDI) through liberalization and attracts market-seeking FDI through protection.

In addition to policy coherence within each of aid, trade, and investment policy area, coherence across the three policy areas is also critical for enhancing the positive impact of development assistance. For instance, aid disbursement conditioned upon trade liberalization will lack policy coherence where the aid recipient’s economy has limited supply-response capacity or is patently unable to defray the short-run costs. Similarly, the donor provision of aid to particular low-income countries may be more or less offset when the donors simultaneously erect trade barriers against their exports. There are many examples of this conflict. For instance, distortions to agriculture in several donor countries lead to significant reduction in the real income of many aid-recipient countries.

Across the aid, trade, and investment policy areas, there is a fundamental difference in the perspectives of aid donors and recipients. The former generally expect that aid disbursement should go hand-in-hand with the liberalization of the trade and investment regimes of the aid recipients; while the latter contend that building their supply response capacity should have priority and, hence, that trade and investment policies must be coordinated and strategically linked and involve gradual, selective and differentiated liberalization.

Enhancing policy coherence and, thus, effectiveness of aid requires an appropriate mechanism for reconciling and accommodating these differences. This should encourage the aid-recipient country to articulate a consistent development program with coherent policies for dealing with identified constraints and indicating how and where external assistance is required. It should then permit donors to evaluate the program’s coherence and feasibility and, in the process, coordinate donors’ activities with the program as a basis for establishing a constructive and mutually beneficial partnership.

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The Role of Civil Society Organizations in Influencing Trade Policy Making: Strategic Planning and Brainstorming Meeting

Thu, 06 Sep 2007 13:10:43 +0100

Source: Arab NGO Network for Development

The involvement of civil society organizations in trade policy processes has become perhaps the central issue in the lively and often acrimonious debate on the "democratic deficit" held by many to exist in the functioning of the multilateral trade system . The more trade interferes in social trends, domestic affairs, norms of life, national traditions, and social institutions that touch on people’s rights and standards of living, the more civil society organizations see a necessity for interference. Civil society organizations want "in" to trade policy – and not merely to be listened to and politely shown the door when the time comes for serious decision making. What they are clearly seeking is to rebalance, not simply to be heard .

Approaches to addressing trade and development policies and advocacy tools used for lobbying in this area vary among organizations and among agreements and regions. Civil society has taken on different roles and types of mobilizations in this area. Different kinds of intelligence, analysis, and advocacy on trade policy, including that in think tanks, universities, the legal community, grassroots organizations, research and advocacy groups, policy NGOs, and social movements bring their perspectives and propositions forward in quest of influencing the current trade system. Protests and mass mobilization is the most visible strategy, especially when the street protests in Seattle and other cities contributed to the collapse of the multilateral negotiations in the World Trade Organization (WTO).

In this context, three broad functional categories of civil society organization coalitions or networks are identified: "mobilization networks," whose chief objective is to rally support for a specific set of activities; "technical networks," which are designed to provide information to civil society organizations to facilitate their participation in the policy process; and networks dedicated to servicing developing countries, which are dubbed a "virtual secretariat" for the latter.

Given the limitation of resources, capacities, and previous experience in the area of trade policy advocacy, and discrepancies in capacities among regions, the exchange of experiences among regions and groups becomes of significant added value.

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Managing Commodity Booms in Sub-Saharan Africa

Thu, 06 Sep 2007 12:58:14 +0100

African Economic Research Consortium

Current booms in commodities of importance to African economies bring into sharp focus the importance of managing such booms effectively, so that they are neither panacea nor curse, but major inflows of resources with potential to promote sustainable development and poverty reduction. AERC researchers have recently been investigating how best to manage commodity booms to maximize this contribution to the economy. Discussions by the ninth Senior Policy Seminar were organized around the following seven themes:
• Lessons of international experience
• Africa’s management of previous oil booms
• Strategies for managing the current oil boom
• Africa’s management of previous solid mineral booms
• Strategies for managing the current solid mineral booms
• Africa’s management of previous agricultural commodity booms
• Strategies for managing the current agricultural commodity boom

Welcoming the participants, Cameroon’s Minister of State, Augustin Kodock, indicated how timely the subject was for most African governments, and particularly Cameroon. He expressed a wish for strong policy recommendations to come out of the seminar, including strategies to keep Africa’s commodity prices at the highest possible levels. In the official opening address, the Prime Minister of Cameroon, Ephraim Inoni, commended African researchers and policy makers as fully capable of analysing issues, rather than solely relying on lessons from other continents transmitted by international experts. He stressed the importance of the seminar’s focus on the impact of commodity booms on government revenues and expenditures. He hoped that the deliberations would improve the future management of resulting budget surpluses and the planning of long-term expenditures to avoid the “boom and bust” cycles of past commodity price volatility. This would help keep Africa on a path of steady development.

Policy recommendations arising from the ensuing discussions were to:
• Turn general declarations of support for agriculture into detailed commodity-specific strategies with adequate budgets.
• Promote microfinance as one way to assist farmers.
• Strengthen agricultural research institutes for improved technology, research and development, as well as extension services.
• Analyse the potential for intra-African commodity trade, as well as the impact of the Africa-Caribbean-Pacific/European Union (ACP-EU) economic partnership agreements and any potential Doha Round based liberalization.
• Assess the structure of agricultural production more closely – that is, under what circumstances do large farmers, small farmers and agricultural labourers gain?

Countries have different political and economic contexts so options will vary. However, they can choose from among the following:
• Encouraging farmers to diversify into other crops and non-farm activities, and to save and invest their earnings during boom times.
• Promoting national economic diversification into manufacturing, value added and use of by-products by investing boom revenues.
• Establishing stabilization funds and buffer stocks, in addition to investing boom revenues in infrastructure to support farmers – rural roads, electricity, irrigation, extension, technology and research.
• Rethinking and restructuring marketing boards so that they can retain their regulatory role and provide support services to the farmers, plus developing effective systems to improve farmers’ access to reliable, accurate and timely market information.
• Encouraging joint ventures between countries for value adding activities,especially within regional trade blocs.

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The debt-trade connection in debt management initiatives. The need for a change in paradigm

Thu, 14 Jun 2007 06:43:28 +0100

Source: CHOIKE

The current international community efforts to support development and poverty reduction in developing countries are based on the notion that the participation of these countries in the international economic system is deeply affected by a series of asymmetries and imbalances. Debt and trade policies are perceived to be a crucial part of this complex of policies. However, the close interdependence that exists between the asymmetries in the trade system and the chronic nature of the over indebtedness problem faced by developing countries oftentimes goes missing in policy initiatives.

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The Aid for Trade Debate in WTO

Mon, 19 Mar 2007 12:05:12 +0000

Source: Economic Commission of Latin America and the Caribbean

One of the central aims of the accelerated negotiation process of the Doha round, which is currently taking place in WTO, is to tackle the development dimension of the multilateral trading system. Few results have been achieved in relation to this objective, however, since the beginning of these negotiations at the Fourth WTO Ministerial Conference held in Doha at the end of 2001. In this context a new element, or possibly a new approach, has been introduced into the debate and was included in the final declaration of the Sixth Ministerial Conference held in Hong Kong at the end of 2005 (ECLAC, 2006a).This declaration added to the work of this Round a greater commitment to Aid for Trade, which is intended to help developing countries, particularly the least developed countries (LDCs), to build or develop the capacities that will assist them to implement and benefit from WTO agreements.

Aid is not a substitute for other aspects of the development dimension covered by the present Round and in particular for greater market access opportunities for developing countries’ exports. This issue is of great interest to the Latin American and Caribbean countries, since they are all developing nations (Haiti alone is in the LDC category), and their trade, economic and social performance has lagged behind that of other economies at a similar level of development.

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Oslo Conditionality Conference

Tue, 09 Jan 2007 14:26:24 +0000

The Norwegian government, whose aid money cannot be spent on programs that require trade liberalization and privatization, hosted an inter-governmental meeting in November to assess the extent to which the World Bank and IMF still require developing countries to pursue privatization and liberalization as a condition of support. An independent study commissioned for the meeting, determined that while the World Bank and IMF are still pushing privatization and trade liberalization in their development policy lending, it is less pervasive than in the past. It also concluded that governance conditions are increasingly taking the place of economic policy prescriptions, and that developing government “ownership” over Bank and Fund policies is still weak.

Held in Oslo, the meeting brought together Finance and Development Ministries from Norway, Sweden, Denmark, Finland, UK, Germany and the Netherlands, as well as academics and civil society groups. Canada which had agreed to participate, withdrew from the conference some days before, as did the IMF.

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The Doha Development Agenda (DDA) and Aid for Trade: Finding the Policy Link

Tue, 09 Jan 2007 12:42:00 +0000

Author: International Gender and Trade Network (IGTN)

The paper critically analyzes the rationale and principles of Aid for Trade as presented by the Task Force to the 27 July 2006 General Council at the WTO and identifies policy and issues and evaluation indicators of an eventual implementation of Aid for Trade. It analyses and questions theoretical references and principles underpinning Aid for Trade and offers conclusions and recommendations.

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The Collapse of Cancun: A Perspective on the Problematic

Mon, 20 Feb 2006 09:46:13 +0000

The Collapse of Cancun: A Perspective on the Problematic* Rashed al Mahmud Titumir, Social Science Review [The Dhaka University Studies, Part - D], Vol. 21, No. 2, December, 2004, pp. 69 - 86

The paper attempts an enquiry into the failure of the fifth WTO Ministerial Conference in Cancun in 2003 of the much-hyped Doha Round of multilateral trade negotiations. The first part assembles divergent negotiating positions of major countries/blocs on the issues under multilateral trade negotiations, chiefly those at Cancun. The second part considers roles played by different actors at Cancun and exposes imbalances that afflict developing countries. The final part ends with recommendations for the internal reflection by Bangladesh and elements of strategy she may choose for her onward journey.