Background
For developing countries, participating in regional and global trade is crucial to their efforts to reduce poverty sustainably. However, at around one per cent, the least developed countries’ share of global trade remains very low.
If developing countries are to make better use of the advantages of cross-border trade, trade agreements need to be designed to promote development, regardless of whether they are negotiated under World Trade Organization (WTO) auspices or in other fora. However, in many cases, the industrialised nations’ trade policies do not yet adequately reflect the interests of developing countries.
Conditions also need to be created within the developing countries themselves to promote commerce and facilitate wide-ranging participation in trade. Decision-makers frequently lack the necessary know-how to campaign effectively for necessary reforms.
The role of Germany’s Federal Ministry for Economic Cooperation and Development (BMZ) and German service providers in the area of international cooperation and sustainable development, including GIZ, is therefore to support developing countries in making better use of the potential for trade.
Objective
The German Federal Ministry for Economic Cooperation and Development (BMZ) and German service providers in the area of international cooperation and sustainable development take greater account of development oriented trade policy when designing their portfolios and shaping the relevant policy area, particularly as part of international processes.
Approach
The project provides BMZ with technical and human resources support to take greater account of key aspects of development oriented trade policy in its measures and its input to international processes. It operates in two areas of activity:
1. Further development of the policy area. Trade-related development policy and aspects of trade policy relevant to development both play a part here. Work is currently focusing on the priority areas of trade and the 2030 Agenda, trade and the G20, Aid for Trade, the WTO, trade facilitation, regional economic integration, intellectual property rights and access to drugs, technology transfer, digital trade, and quality infrastructure. The project develops concepts, strategies and positions for BMZ. On the basis of research, it also develops new approaches for creating development oriented trade structures. These are trialled in German development cooperation (DC) projects and fed into national and international debates.
2. Advising DC projects as part of the Aid for Trade concept. The Aid for Trade initiative was launched at the 2005 WTO Ministerial Conference. It supports developing countries in improving their integration in regional and international trade by mobilising additional financial resources and creating greater awareness of the importance of trade promotion for sustainable development. For this purpose, BMZ has developed a concept that serves as the basis for German development policy in the area of trade. The project processes the practical experience gathered in German development cooperation work and takes up new ideas emerging from relevant international debate, passing these on to DC projects through advisory services, training and other instruments.
Results
With support from the project, BMZ has been successful in influencing in a number of international processes and debates. These include implementation of the WTO Trade Facilitation Agreement, ongoing negotiations on the Doha Agenda and the Trade in Services Agreement (TiSA), and extension of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) for the least developed countries.
German development cooperation projects have trialled and disseminated innovative approaches to a range of trade issues. For example, the sector project has helped to design two projects to support developing countries in implementing the WTO Trade Facilitation Agreement.
The wide-ranging work of the project is helping to ensure that partner countries can make better use of the potential for trade to promote their economic and social development.