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  • Case study: Bangladesh Presented by:

    Mohammad Farhad Bangladesh Foreign Trade Institute

    AID FOR TRADE EXPERT DIALOGUE BANGKOK, 18th Nov. 2013

  • Outline of presentation

    Preparation Stage Implementation Stage Preliminary Results Identified Challenges for Project Implementation or Next Steps

  • Research Team Joined the project at the end of May 2013 No formal research team was formed for

    Bangladesh

    1. Preparation stage

  • Project Overview

    Background, rationale and aims/objectives of study - The project at hand is to design a methodology to measure AfT project effectiveness

    2. Implementation stage

  • Overview of Aid for Trade in Bangladesh

    2. Implementation stage

  • Trade and development strategies: The overarching goal of Bangladesh is to take the country

    forward through achieving the Millennium Development Goals (MDGs) and becoming a middle income country by 2021.

    The countrys development strategies and priorities are laid down in its ten-year national development plan, named the Perspective Plan (PP), 2011-2021.

    Trade is explicitly highlighted in the countrys development priorities. The PP endorses the present trade policy regime, outlined in sub-section 2.1, and underscores that to cross the middle income threshold by 2021, Bangladesh will need to transform its trade regime to the kind seen in high-performing emerging market economies .

    2. Implementation stage

  • Trade and development strategies (contd.) The PP also emphasises that trade should be mainstreamed

    in the countrys national development agenda, and should particularly incorporate Aid for Trade, and recognises that Bangladesh needs to take initiatives for making best use of AfT with a view to building and improving the countrys trade capacity and infrastructure so as to benefit from the opportunities created in the multilateral trading system.

    The PP outlines several strategic approaches meant to get the maximum leverage out of the manufacturing sector and its competitiveness in the global marketplace, including:

    (a) Export diversification (b) Export restructuring in a globalised economy (c) Working on market access issues.

    2. Implementation stage

  • Trade and development strategies (contd.) Like the PP, the Sixth Five Year Plan (SYFP) (GOB, 2011)

    also endorses the countrys outward-oriented growth and trade strategy, and seeks to further reduce trade barriers as provided by the WTO rules framework and to promote more effective cooperation with the neighbours and also envisages active participation in relevant international and regional/sub-regional fora.

    Aid for Trade is considered as a means to facilitate the achievement of these policy objectives.

    2. Implementation stage

  • Flow of Aid for Trade in Bangladesh: In Bangladesh, all types of aid (both grants and loans) are

    received through the ERD of MoF. Aid received is categorised into 17 sectors, however, there is no separate classification for aid the country receives in the form of AfT, which means that ERD does not have accurate information on the actual aid flows in the category of AfT.

    However, it has become much easier to track the flows of trade-related aid since the beginning of AfT initaiative, as the OECD-DAC Aid activities database (CRS), introduced in 2007.

    According to OECD-WTO data, Bangladesh is the second largest recipient of AfT among the LDCs.

    2. Implementation stage

  • Flow of AfT in Bangladesh: Average annual flow during 2006-2009 (in million US$)

    Source: OECD-WTO

    2. Implementation stage

    Category Total (2006-2009)/ Annual average Commitment Disbursement

    AfT, total Total 137,465.2 98,842.4 Annual average 34,366.3 24,710.6

    AfT, LDCs

    Total 39,096.2 26,887.12 Annual average 9,774.05 6,721.78 % of AfT total 28.44% 27.20%

    AfT, Bangladesh

    Total 3,669.08 1,756.64 Annual average 917.27 439.16 % of AfT total 2.67% 1.78% % of AfT LDCs 9.38% 6.53%

    AfT, trade policy & regulations, total

    Total 4,907.12 3,217.52 Annual average 1,226.78 804.38

    AfT, trade policy & regulations, LDCs

    Total 1031.12 584.4 Annual average 257.78 146.1

    % of trade policy & regulations, total 21.01% 18.16%

    AfT, trade policy & regulations, Bangladesh

    Total 114.64 91.4 Annual average 28.66 22.85

    % of trade policy & regulations, LDCs 11.12% 15.6%

    AfT, trade facilitation, total Total 796.64 478.72 Annual average 199.16 119.68

    AfT, trade facilitation, LDCs Total - 55.12

    Annual average - 13.78 % of trade facilitation, total - 11.51%

    AfT, trade facilitation, Bangladesh

    Total .04 .524 Annual average .010 .131

    % of trade facilitation, LDCs - 3.80%

  • Flow of AfT in Bangladesh: Growth of AfT disbursement: Global vis-a-vis Bangladesh (2010

    constant price) Source: OECD-DAC CRS database

    2. Implementation stage

    AfT Categories Total AfT

    (% change) during 2006-11 over 2002-05

    Bangladeshs AfT (% change)

    during 2006-11 over 2002-05

    Economic infrastructure 77.92 20.00

    Building productive capacities 56.03 -44.81

    Trade Policies and Regulations

    59.54 686.03

    Total 66.79 -28.68

  • Project Selection Sources of project data: International and National data sources were

    explored OECD Creditors Reporting System (CRS), WTO

    Trade-Related Technical Assistance Database (GTAD), World Bank project data

    Government database- Completed Project Evaluation Reports 2003-2010; Implementation Monitoring and Evaluation Division (IMED), Ministry of Planning, Government of Bangladesh

    2. Implementation stage

  • List of Completed Projects in Bangladesh under AfT (2003 - 2011)

    2. Implementation stage

    Year Completed: 2003 Year Initiated Project Name Donor AfT Category Type of Aid

    2000 Bangladesh Export Diversification Project (BDXDP) World Bank,/DFID

    Trade development

    2001 Bangladesh and the WTO: Trade Policy, the Changing International Environment and Poverty Reduction

    DFID/Netherlands

    Trade development

    1999 Agricultural Services Innovation and Reform Project Building productive capacity

    Loan

    Year Completed: 2005 Year Initiated Project Name Donor AfT Category Type of Aid

    2001 Bangladesh agro-based industries and technology development project (ATDP II)

    USAID Building productive capacity

    Job Opportunities and Business Support (JOBS) project USAID Building productive capacity

    2003 Technical Assistance to Privatization Commission ADB Building productive capacity

    Grant

    Year Completed: 2006 Year Initiated Project Name Donor AfT Category Type of Aid

    2002 Research for the development of sustainable aquaculture practices

    USAID Building productive capacity / Trade development

    Grant

  • List of Completed Projects in Bangladesh under AfT (2003 - 2011) cont.

    2. Implementation stage

    Year Completed: 2007 Year Initiated Project Name Donor AfT Category Type of Aid 2002 Katalyst (Phase I) (http://www.katalyst.com.bd/) DFID/SDC/ SIDA Building productive

    capacity/ Trade development

    2003 Business development service for private sector promotion

    GTZ Trade development Grant

    2003 Market Access and Trade Facilitation Support for South Asian LDC's through Strengthening Institutional and National Capacities (SMTQ)

    NORAD & India Trade development Grant

    Year Completed: 2008 Year Initiated Project Name Donor AfT Category Type of Aid 2003 Developing business services Markets programme in

    Bangladesh Trade development

    2005 Computerization of the Office of the Registrar of Joint Stock Companies and Firms (RJSC)

    SEDF, AusAid Trade Facilitation Grant

    2006 Capacity building of FBCCI JICA Grant 2005 Technical assistance for promoting private sector

    participation in the energy sector ADB Building productive

    capacity/ Trade development

    Grant

  • List of Completed Projects in Bangladesh under AfT (2003 2011) cont.

    2. Implementation stage

    Year Completed: 2009 Year Initiated Project Name Donor AfT Category Type of Aid 1/1/2005 Bangladesh Trade Support Programme European Union+GoB Trade policies and

    regulations/Trade Development

    Grant

    South-Asia Enterprise Development Facility (SEDF) I DFID , ADB, CIDA, EU, IFC, the Netherlands,

    and Norway.

    Trade Development Grant/ Loan

    2005 Bangladesh Leather Service Center Italy Building productive capacity

    Grant

    2000 Chittagong Di-Ammonium Phosphate(DAP-1) Project Building productive capacity

    Loan

    Year Completed: 2010 Year Initiated Project Name Donor AfT Category Type of Aid 1/1/2006 Bangladesh Quality Support Program (BQSP)

    (http://best-bd.org/bqsp/index.php) EU/ NORAD/ UNIDO/

    ITC Trade policies and regulations / Trade development

    Grant

    2004 Trade Related Research and Policy Development CIDA Trade policies and regulations

    Grant

    10/1/2008 Promotion of Social and Environmental Standards in the Industry-PSES (http://www.pses.com)

    GIZ Trade development Grant

  • List of Completed Projects in Bangladesh under AfT (2003 2011) cont.

    2. Implementation stage

    Ongoing Year Initiated Project Name Donor AfT Category Type of Aid 12/1/2008 Technical and Vocational Education and Training

    (TVET) Reform European Union Building productive capacity Grant