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WTO’s 5th Aid for Trade Global Review

Reducing Trade Costs to Increase Competitiveness

The Inter-American Development Bank (IDB) underscored the importance of reducing trade costs in Latin America and the Caribbean (LAC) to increase the region’s competitiveness and its participation in international value chains and promote a more equitable growth in the framework of the 5th Global Review on Aid for Trade (AfT) that took place during the first days of July at the World Trade Organization (WTO).

Antoni Estevadeordal, Manager of the Integration and Trade Sector of the IDB participated as a panelist in the Opening Plenary Session: “Reducing Trade Costs for Inclusive, Sustainable Growth”, inaugurated by WTO Director General Roberto Azevêdo, on how reducing trade costs can contribute to the United Nations’ emerging Post-2015 Development Agenda. The session addressed the importance of trade costs for economic performance and experiences on how to reduce them, as well as the social impact of reducing trade costs and the link to Sustainable Development Goals and the Financing for Development agenda.

Antoni Estevadeordal also participated in Parallel Plenary Session 4: “Reducing Trade Costs in Central America through Trade Facilitation”, jointly organized by the IDB and the Secretariat for Central American Economic Integration (SIECA, for its Spanish acronym). This sub-regionally-focused session addressed trade facilitation in Central America, examining how it fits with the region's trade and economic agenda, policies and measures to reduce the cost of trade, the needs of the private sector and stakeholder support to the integration process. Carmen Gisela Vergara, SIECA Secretary General, acted as moderator, and Elena María de Alfaro, Member of El Salvador’s Chamber of Commerce and Industry and President of El Salvador’s Business Foundation for Social Action; Jhon Fonseca, Costa Rica’s Vice-Minister of Foreign Trade; and Alejandro Gamboa Castilla, Director-General of the Colombian Presidential Agency for International Cooperation acted as panelists and discussed key topics such as lessons learned from on-going initiatives, the role of public-private partnerships and of traditional donors and South-South cooperation partners in ensuring successful trade facilitation interventions.

Joaquim Tres, Regional Integration Instruments Coordinator at the IDB, participated in Plenary Session 17: “Reducing Trade Costs and the Aid-for-Trade Results Agenda: Lessons from Recent Evaluations and Impact Studies”, which focused on the role of evaluation and impact assessments in ensuring efficient and effective Aid for Trade delivery to reduce trade costs more effectively and to springboard accountability to national and international stakeholders. Joaquim Tres emphasized the importance of impact assessment in different aspects of IDB interventions. First, he underlined the need for solid results frameworks to report outputs and outcomes at the project level as an effective tool to enhance the quality of interventions and overall development effectiveness and accountability. Joaquim Tres also discussed the IDB’s Capacity Building Program on Integration and Trade, which since 2013 has trained more than 3,000 LAC public officials in over 130 online tutored courses and established 10 communities of practice to facilitate continuous learning among course graduates, stressing the need to assess the impact of the Program’s courses through a robust assessment of the knowledge transfer of participants into the workplace. Finally, he pointed out that the IDB also tracks the leverage effect of donor-funded interventions on lending, which reached US$80 in loans for every US$1 in grants from the IDB’s Aid for Trade Strategic Thematic Fund (Canada, Chile, Switzerland and the United Kingdom) and the Regional Infrastructure Integration Fund (Canada, Colombia, Mexico, Spain and the United States).

The 5th Global Review on AfT was also an opportunity to present the recent IDB publication “Bringing Down the Barriers: IDB Research on Trade Costs in LAC”, which summarizes the Bank’s research since 2008 on the impact of transportation costs, information constraints and trade facilitation on LAC’s trade performance; the effect of regulatory overlap stemming from the proliferation of trade agreements since the early 1990s'; and the region's participation in global value chains.

To learn more on the WTO’s 5th Global Review on AfT, click here.

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