GC: In Speech On Aid For Trade, Lamy Stresses Monitoring And Evaluation

20 December 2006

In a speech to WTO Members on aid for trade, Director-General Pascal Lamy highlighted the importance of monitoring and evaluation to ensuring that trade-related assistance efforts are effective. The aim was not to turn the WTO into a development agency, he said. Instead, he envisioned a scenario in which the WTO would focus on helping the wide range of existing international donors to better understand recipient countries' trade-specific needs.

Transparency and evaluation, Lamy explained, would be crucial to ensuring that aid for trade promises are being kept and delivering the expected results. If assistance is failing to deliever, evaluation would be necessary to determine what needs to change. He outlined some of the WTO Secretariat's current views on how a monitoring mechanism could function at the multilateral, regional, and country level.

In October, Members endorsed the recommendation's of the Aid for Trade Task Force (WT/AFT/1, see BRIDGES Weekly, 11 October 2006). That panel had been set up in accordance with the Hong Kong Ministerial Declaration, with the mandate to provide Members with recommendations for how aid for trade "might contribute most effectively to the development dimension of the Doha Development Agenda." Its report set out a detailed course of action for aid for trade, with guidelines for funding, identifying recipients' priorities, and monitoring (see BRIDGES Weekly, 2 August 2006). Aid for trade work is at least in principle separate from the ongoing Doha Round negotiations.

Sources report that Lamy said that the WTO's role in aid for trade should centre on promoting coherence: to play the role of a catalyst to ensure that the various organisations involved in trade-related assistance actually do the work that recipient countries need done. He stressed that there was no need to set up new mechanisms for delivering aid. Existing ones need to be used more effectively.

The WTO chief said that Members would have to agree on a definition of aid for trade in order to monitor it. He acknowledged that this would be difficult, since the line between trade-related assistance and overall aid is a blurry one. For instance, infrastructure aid could well boost countries' ability to participate in international commerce. Yet, all infrastructure spending should not end up eligible to be classified as aid for trade.

Outlines three-level monitoring process

According to sources who attended the meeting, Lamy described a three-level monitoring process, based on a new paper prepared by the Secretariat (JOB(06)/262). To avoid duplicating work already being done elsewhere, he suggested that a broad global picture of aid for trade flows could be drawn based largely upon the existing database maintained by the Organisation for Economic Cooperation and Development's development assistance committee (OECD-DAC). Regular progress reports by multilateral, regional, and bilateral development agencies would provide a second level of monitoring. The final level would come from country-based monitoring and evaluation, to assess what the money actually achieves on the ground in each recipient country

The Secretariat's document acknowledged that the WTO would have to rely on data from other agencies and organisations, which could taint any effectiveness assessment. Nevertheless, the WTO would be uniquely placed to collect all the data related to aid for trade activities and analyse their real impacts. The monitoring process, it said, should be two-fold: quantitative, in terms of assessing commitments and pledges versus actual disbursements; and qualitative, such as measuring the actual impact of activities on trade growth, export diversification, poverty reduction and so on.

Also playing a role in monitoring would be the expert committee whose creation was recommended by the Task Force, Lamy said. He suggested that it should comprise a network of donor agencies, international organisations and private sector representatives. Sources say he indicated that civil society should be part of this process, although he did not specify whether this would be as part of the committee.

In his remarks to delegates, Lamy reported that major donor countries told him that they remained committed to the large pledges of aid for trade that they made at the time of the Hong Kong Ministerial Conference in December 2005. He said that non-traditional donors -- including developing countries -- were also eager to participate. He stressed the need for additional, dedicated financing for aid for trade, and told recipient countries that for such efforts to truly be 'demand driven,' they too have much work to do: specifically, to develop the projects and business plans that will be put into place.

Lamy said that the Secretariat was working towards including a general assessment of aid for trade -- for donors and recipients alike -- in future Trade Policy Reviews. He also proposed an annual debate on aid for trade in the General Council, starting next autumn. The Committee on Trade and Development would set the groundwork for this, holding a series of meetings to discuss aid for trade in the run-up to the debate. He also suggested that public seminars open to the media and civil society could be organised in order to increase transparency about aid for trade work.

Members gave Lamy's speech a generally positive reaction, especially on the point that the WTO should restrict itself to the role of monitor and catalyst. The African Group in particular stressed the need for 'additionality,' that is, for aid for trade resources to come over and above existing promises of overall assistance. Members urged the director-general to translate the Secretariat's ideas into something concrete as soon as possible.

ICTSD reporting.  

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