United Nations Development Programme

Wider Europe project:Aid for Trade in Central Asia, South Caucasus, and Western CIS

Sheila Marnie UNDP Central Asia EconomistAlmaty, 14th September 2012sheila.marnie@undp.org

Trade as a tool to leverage human development …

Approach

• Supporting the link between human development and trade

• Work at different levels: national, regional, community

• Project focus:

– Capacity building on trade issues at national and local level

to help countries incorporate pro-poor, development-centered trade policies into national and local development strategies

– strengthening trade capacity of SMEs and farmers through business skills development, improving access to market information, access to finance, capacity development of associations for exports promotion, etc.

Project Information

Donors: Ministry for Foreign Affairs of Finland; Government of Luxembourg

Implementation:• Phase I: 2009-2011

• Phase II: 2011-2014

Budget (Million Euro):

Phase I: 1.8

Phase II: 4.7

Wider Europe - Aid for TradeProject Coverage

11 countries in Central Asia, South Caucasus, Western CIS

Phase I: 2009-2011

• 1. AfT Needs Assessments

• 2. Economic Development along transport corridors in CA for SMEs, farmers and associations

Aid for Trade Needs Assessments under phase I

Development of Aid for Trade Needs Assessments in 11 countries in Central Asia, South Caucasus and Western CIS:

Objectives:• Identification of capacity gaps

(institutional, human, etc.) and technical assistance needs;

• Development of policy recommendations and action matrix for potential donor assistance;

• Development of concrete project proposals for AfT interventions.

In country activities: promoting trade along transport corridors

Trade CapacityBuilding

Trade related information capacities

Expanding SMEs’Access to

Financial Services

Eco-Friendly Technologies and Green commodity

To enhance private and

public sector’s trade-related

capacity

Wider Europe - Aid for TradePhase II

I. Linking products with key markets along trade/transport corridors

• Business Development Centres : ARM, GEO, KAZ, KGZ, TAJ• Business training & SME advise : GEO, KAZ, KGZ, MDL, TAJ • Co-financing innovative investments : ARM, KAZ, KGZ, TAJ• Trade information:

• business/exporters/investment guides : GEO,• online market places : ARM, KGZ, TAJ

• Trade in services : GEO• Vocational skills : GEO• Environmental friendly production : KGZ, TAJ

II. Better use of trade opportunities

• Electronic trading facility for light industry : BEL• Capacity development for fruit sector : MDL• Region trade strategy : TAJ• Trade policy – national export strategy, WTO tariff commitments, export financing : UKR

Wider Europe - Aid for TradePhase II

III. Overcoming trade barriers

• Informal trade barriers: research, dialogue process, information (GEO, MDL)• Trade Capacity Development

• Local: region administration, staff of trade/business/information centers (ARM, GEO, TAJ, UKR)

• Central Asia: trade support agencies, entrepreneurial associations (KGZ, TAJ, UZB)

IV. SMEs to benefit from trade

• Application of new technologies, tools for better market access for SMEs (Central Asia )• FairTrade: certification, SME networking, trade fairs (Central Asia)

Synergies with UNDP-supported local development initiatives in CA

• Area-Based Development Programmes in Tajikistan, Kyrgyzstan, Kazakhstan and Uzbekistan

• Presence on the ground for many years

• Permanent offices and field staff

CA coverage: link to ongoing local development programmes

Links to CAREC transport corridors

• 6 corridors traverse Central Asia, including in regions where UNDP active in local development

• Link efforts to improve behind-border conditions and new transport infrastructure

• Very topical due to “Istanbul Process” and efforts to integrate Afghanistan with other countries of sub-region

MONGOLIA

PEOPLE'S REPUBLIC OF CHINA

PAKISTAN

AFGHANISTAN

TAJIKISTAN

KAZAKHSTAN

UZBEKISTAN

TURKMENISTAN KYRGYZ REPUBLIC

RUSSIAN FEDERATION

IRAN

ULAANBAATARASTANA

ASHGABAT

XINJIANG UYGUR AUTONOMOUS REGION

INDIA

Urumqi

N

BISHKEK

AZERBAIJANBAKU

CAREC-1a,c

1a

1c

CAREC-2CAREC-1CAREC-5

CAREC-4a

CAREC-2

2a

2b

CAREC-6a

CA

RE

C-1b

CA

RE

C-6b,c

6a

6b,c

3a

3b

CAREC-6a,b

CAREC-3bCAREC

-3

CAR

EC-6

cC

AR

EC-5

Tashenta

N

TASHKENT

DUSHANBE

KABUL

Ulaanbaishint

Olgiy

Hovd

YarantTakeshiken

Hexi

LianyungangTurpan

KashiUlukeqiati

IrkeshtamSary-Tash

Karamik

Kushat

Kurgan-Tube

Nizhni PianjSherkhan

Kunduz

Torkham

Karachi

Troitsk

Fedorovka

Karaganda

Moyinty

Aktogay

Shu

Druzhba Ala Shankou

Almaty

Khorgos

HuochengLugovayaChaldovar

Naryn

Torugart

Chuanwulu Shankou

Agstafa

Yevlakh

Alyat

Turkmenbashi

Turkmenabad

AktauBeyneu

Karakalpakya

Nukus

Uchkuduk

Navoi

Samarkand

DjizakKhavast

Khujand

Kanibadam

KokandAndijan

Kara Suu

Osh GulchaAlat

Bukhara

RubtsovskBelagash

Semey

Charskaya

Taraz

ShymkentArys

SaryagashChukursay

Syrdaryinskaya

Kara Balta

Tursunzade

Shargun

TermezHairatan

Mazar-i-Sharif

Herat

Islam Qala

Aksarayskaya AtyrauMakat

Orenburg

Iletsk

Kandagash

AyniIstaravshan

Mary Tash GuzarBaisun

Kumkurgan

Tianjin

Kandahar

Jalalabad

Gwadar

Port Qasim

Kumla Pass

Balykchy

Khorong

CA

RE

C-4b

Zamyn-Uud

Sukhbaatar

Astara

Ban

dar-

Abb

as

Sarahs

CAREC-3a

Zaranji

Cha

baha

r

Delaram

Aral Sea

CaspianSea

Arabian Sea

PersianGuff

Karachi/Gwadar

Bandar-Abbas

Chabahar

}

}

Kyzyl-Orda

Aktobe

Erenhot

Naushki

1a,bKuytun

Sarakhs

1b

1c

Landi Kotar

Arababad

Gulam Khan

Gerdez{

Band

ar-A

bbas

6b

1b

MONGOLIA

AZERBAIJAN

AFGHANISTAN

PEOPLE'S REPUBLIC OF CHINA

KAZAKHSTAN

KYRGYZ REPUBLIC

TAJIKISTAN

UZBEKISTAN

0 100 200 300 400

Legend:

Kilometers

International boundaries are not necessarily authoritative

CAREC Participating CountriesCAREC 1: CAREC 2:CAREC 3:CAREC 4:CAREC 5:CAREC 6:Feeder Corridors:

PROPOSED SIX CAREC CORRIDORSPROPOSED SIX CAREC CORRIDORS

UNDP and CAREC

• Working – through ABD and AfT to ensure that transport infrastructure brings benefits to communities situated along the corridors

• Not just at the beginning and end points, or in big transport “nodes”

• UNDP AfT focus: not customs legislation, tariffs, infrastructure

• But trade capacity at the micro/ local level

• With Link to regional cooperation

Links to BOMCA

• Integrated border management project

• EU-financed UNDP-implemented

• Since 2003 (now in Phase 8, 2011-14)

• Includes component on Border Crossing Points and Border Outposts

Example of Batken, KYG

• Trade capacity: local development strategy

• Training for entrepreneurs

• Work with local government and local cooperative on creation of Batken brand

• Support to local producers: processing of local agricultural produce, packaging, storage, identification of new markets

• Opening of Batken trade representation in Novosibirsk

Batken Brand

Batken Brand

Example from Sugd, TAJ

No artificial heating (clay)

Cost of one: 17 000US$ (10K – loan and 7K contribution from farmer)

Cost recovery: one year (2 season January-May 2011 and December 2011-March 2012 - 9 months)

Drip irrigation

Organic fertilizer (i.e. cow dung)

Tonnage (collected: 7000kg tomatoes January - May 2011)

Protecting the environment = PROFIT

Environmental protection & business sense

Some examples from the project: TAJ

Bigger yields:

Traditional cotton - 2.17 ton/ha

‘Organic cotton’ - 2.50 ton/ha

Cost price:Traditional cotton – 907 US$/ha

‘Organic cotton’ - 904 US$/ha

Profit:

Traditional cotton – 314 US$/ha

‘Organic cotton’ - 891 US$/ha

Protecting the environment = PROFIT

Natural fertilizer in cotton production

Some examples from the project:

Improved services along the transport corridors:Establishment of a café along the Kyrgyz – Tajik border

Human Development Impact

Enhanced Trade Capacity

New Sales Channels & Business Partnership

Improved Access toFinances

Eco-Friendly & Cost Effective AG Production

Income Generation

Regional Cooperation

Better Access to Market Information

massimiliano.riva@undp.org

TRADE & HUMAN DEVELOPMENT UNITGeneva, Switzerland

www.undp.org/geneva/trade.html

www.undp.org/poverty/focus_trade_ip_migration.shtml

REGIONAL CENTER for EUROPE AND CISBratislava, Slovakia

http://europeandcis.undp.org/poverty

http://akvo.org/rsr/project/305/joern.rieken@undp.org