aid for trade
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AID FOR TRADE. JOHN S. WILSON THE WORLD BANK. NEW YORK JULY 15, 2010. OBJECTIVE AND OVERVIEW. I -Aid for trade – why it matters II - Supply, demand, and effectiveness III – Looking Ahead - LDCs. WHAT AND HOW MUCH?. Aid for trade – official development assistance - PowerPoint PPT PresentationTRANSCRIPT
AID FOR TRADEAID FOR TRADE
JOHN S. WILSON
THE WORLD BANK
JOHN S. WILSON
THE WORLD BANKNEW YORK
JULY 15, 2010NEW YORK
JULY 15, 2010
I -Aid for trade – why it matters
II - Supply, demand, and effectiveness
III – Looking Ahead - LDCs
OBJECTIVE AND OVERVIEW
07/15/2010 2
WHAT AND HOW MUCH?
Aid for trade – official development assistance
Trade policy and regulatory reform
Trade capacity
Infrastructure
Total aid for trade $40 billion (2008)
About 27% of total official development assistance
Aid for trade – official development assistance
Trade policy and regulatory reform
Trade capacity
Infrastructure
Total aid for trade $40 billion (2008)
About 27% of total official development assistance
07/15/2010 3
AID FOR TRADE COMMITMENTS
ODA commitments (constant 2008 US$ million)
Source: OECD CRS 2010.
ODA commitments (constant 2008 US$ million)
Source: OECD CRS 2010.
07/15/2010 4
WHY AID FOR TRADE MATTERS to LDCs
Supports trade as engine of growth
Enhance diversification
Fight protectionism and support for global and regional
trade agenda
Lowers trade costs – more critical given fragile and changed
global demand; higher financing costs
Supports trade as engine of growth
Enhance diversification
Fight protectionism and support for global and regional
trade agenda
Lowers trade costs – more critical given fragile and changed
global demand; higher financing costs
07/15/2010 5
Performance Rankings: LLDCs / LDCs / OECD
LLDCs* LDCs** OECD
LPI (Average Score) 2.36 2.41 3.66
DB Time to Export (days) 48 35 11
DB Time to Import (days) 54 39 11
DB Import (US$) 3,400 2,145 1,146
DB Export (US$) 2,758 1,773 1,090
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* Land Locked Countries ** Least Developed Countries
Sources: Doing Business 2009; Logistics Perception Index 2009.
6
Gains to Reform and Capacity Building
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Sources: World Bank estimates in Portugal and Wilson, 2010.
7
QUESTIONS MOVING FORWARD
Are countries most in need getting aid for trade?
Is aid for trade effective?
A new agenda for LDCs -- with G-20 support (Hoekman
Wilson 2010)
Are countries most in need getting aid for trade?
Is aid for trade effective?
A new agenda for LDCs -- with G-20 support (Hoekman
Wilson 2010)
07/15/2010 8
DOES DEMAND MATCH SUPPLY?
ARMBEN
BGD
BIH
BOL
CMRECU
ETH
HND KAZKEN
KGZ
LKA
MDG
MLI
MNG
MOZ MWI
NIC
PRYUGA
VEN
ZMB
ZWEARG
AZE
BRABWACHL CHN COL CRIDZA
GEO
GHA
GMB
GTMHRVIDN
INDJAMJOR MAR
MDA
MEXMUSMYS
NAM
PAKPANPER
PHL
SLVTHATUN
TUR
TZA
UKRURY
VNM
ZAF
-.0
10
.01
.02
.03
AF
T D
isb
urs
em
en
ts a
s s
hare
of
GD
P
1 1.5 2 2.5 3 3.5TF Index
Average AFT Bottom Performers
Top Performers
Source: Authors Calculations based on indexes from Wilson & Portugal (2010), World Bank and ITC
Controlling for GDP per Capita, Rule of Law and Trade Facilitation Index
Potential Demand for AFT, 2005
ARMBEN
BGD
BIH
BOL
CMRECU
ETH
HND KAZKEN
KGZ
LKA
MDG
MLI
MNG
MOZ MWI
NIC
PRYUGA
VEN
ZMB
ZWEARG
AZE
BRABWACHL CHN COL CRIDZA
GEO
GHA
GMB
GTMHRVIDN
INDJAMJOR MAR
MDA
MEXMUSMYS
NAM
PAKPANPER
PHL
SLVTHATUN
TUR
TZA
UKRURY
VNM
ZAF
-.0
10
.01
.02
.03
AF
T D
isb
urs
em
en
ts a
s s
hare
of
GD
P
1 1.5 2 2.5 3 3.5TF Index
Average AFT Bottom Performers
Top Performers
Source: Authors Calculations based on indexes from Wilson & Portugal (2010), World Bank and ITC
Controlling for GDP per Capita, Rule of Law and Trade Facilitation Index
Potential Demand for AFT, 2005
07/15/2010 9
WHAT ABOUT AID EFFECTIVENESS?
World Bank research.
Examine rate of return on investment.
Inform priorities – global level.
$1 invested in trade policy & regulatory reform = $697
trade.
World Bank research.
Examine rate of return on investment.
Inform priorities – global level.
$1 invested in trade policy & regulatory reform = $697
trade.
07/15/2010 10
AID TYPES & RATES OF RETURN
Aid Spent (USD millions), 2007Aid Spent (USD millions), 2007
*Based on estimates in Helble, Mann, Wilson (2009).
Return on Increase in Aid (USD)*Return on Increase in Aid (USD)*
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SUMMARY CONCLUSIONS
Commitments on aid for trade solid.
But critical gaps remain
Basic data, analysis of effectiveness
Need to leverage large infrastructure investment
Greater clarity and coordination going forward
Unique time to build on achievements to date and drive a
high profile agenda.
Commitments on aid for trade solid.
But critical gaps remain
Basic data, analysis of effectiveness
Need to leverage large infrastructure investment
Greater clarity and coordination going forward
Unique time to build on achievements to date and drive a
high profile agenda.
07/15/2010 12
PRIORITIES - AID FOR TRADE
1. Expand South-South knowledge exchange with strategic
initiative of policy dialogue and advice by bringing
middle-income G20 countries into the aid for trade
initiative.
2. Create a new public-private partnership to harness the
dynamism and expertise in the private sector. The World
Bank is developing an Aid for Trade Facilitation Public
Private Partnership which could serve as a model.
1. Expand South-South knowledge exchange with strategic
initiative of policy dialogue and advice by bringing
middle-income G20 countries into the aid for trade
initiative.
2. Create a new public-private partnership to harness the
dynamism and expertise in the private sector. The World
Bank is developing an Aid for Trade Facilitation Public
Private Partnership which could serve as a model.
07/15/2010 13
PRIORITIES - AID FOR TRADE
3. Provide dedicated financial support for a global program
of monitoring and evaluation of aid for trade anchored in
systematic data collection and research .
4. Promote market access for low income countries through
a commitment by all G20 members to eliminate import
restrictions for LDCs, thus stimulating South-South trade
and leveraging return on aid for trade disbursements.
3. Provide dedicated financial support for a global program
of monitoring and evaluation of aid for trade anchored in
systematic data collection and research .
4. Promote market access for low income countries through
a commitment by all G20 members to eliminate import
restrictions for LDCs, thus stimulating South-South trade
and leveraging return on aid for trade disbursements.
07/15/2010 14
JOHN S. WILSON THE WORLD BANK
HTTP://WORLDBANK.ORG/TRADE HTTP://ECON.WORLDBANK.ORG/PROJECTS/TRADE_COSTS
THANK YOUTHANK YOU
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