Aid for Trade Falls to $41.5bn in 2011

The WTO-OECD report found, for instance, that aggregate Aid for Trade fell to US$41.5 billion in 2011, largely due to lower contributions from G-20 countries. Overall official development assistance (ODA), with the exclusion of debt relief, also fell for the first time since 2007.

Ministers, delegates, civil society, and private sector representatives gathered in Geneva in early July to review the progress of the WTO’s Aid for Trade initiative, an eight-year-old effort designed to help developing countries better integrate into the world trading system. While the emergence of global value chains has created new opportunities in this area, participants broadly stressed that challenges remain, particularly given that donor countries have had to tighten their aid budgets as a result of the financial crisis.

These “Global Reviews” of the Aid for Trade initiative are held on a biennial basis, with this year’s event marking the fourth since the project began. The theme of this year’s event was “Connecting to Global Value Chains,” focusing both on how countries can better integrate into these chains and move “up” them by producing more value-added goods.

Eight years in

The Aid for Trade initiative was formally launched at the 2005 Hong Kong Ministerial Conference, shortly after Lamy began his first term. Eight years into the initiative, donors have allocated more than US$170 billion in Aid for Trade commitments, according to the joint report prepared by the WTO and the Organisation for Economic Co-operation and Development (OECD) for the event.

The effort has also been shown to generate large returns in developing country exports. OECD-WTO analysis found, for example, that US$1 in Aid for Trade is associated with an increase in developing countries’ exports by US$8, with that number reaching up to US$20 for some of the poorest countries.