BUILDING LDC TRADING CAPACITY
On the institutional front, in 2016 alone, over 11,000 public officials as well as 5,000 private sector officials in 40 LDCs were trained in trade-related areas, including trade facilitation, global value chains, standards and quality, enterprise development, taxation, trade policy formulation, implementation of trade reforms, trade mainstreaming, and gender mainstreaming in trade. On average, 30 percent of the trainees were women. The knowledge gained facilitates inclusive participation in the national trade agendas of LDCs.
Aid for Trade in LDCs is better delivered when key actors, in both the public and private sectors, work together on the national trade agenda. The EIF has helped 33 countries to establish trade coordination mechanisms which allow development partners to maintain a dialogue on trade-related issues, monitor trade-related activities, and ensure that initiatives are complementary, avoiding duplication of efforts. Such mechanisms include high-level dialogue between government and the private sector on trade policy issues, consultations between government and donors on interventions in the trade sector, and working groups spanning the trade sector.
On the policy front, inadequate and outdated trade policies are major constraints on LDCs’ capacity to trade. In response, through its institutional support, the EIF has helped 35 countries (including three graduated LDCs) make trade a key component of their national development plans. Twenty-one countries have produced updated trade policies which identify trade-related priorities in trade in goods and services at both regional and global levels.
In order to effectively mainstream trade into the national development agendas, the EIF has supported 32 LDCs in linking their sector strategies to their trade policies. The aim is to integrate trade into at least three productive sector strategies, which can include agriculture, tourism, energy, industry, information and communication technology, and transportation, as well as cross-cutting areas such as the environment, hard infrastructure, e-trade, gender equity, and micro, small, and medium-sized enterprises (MSMEs). The EIF also assists in ensuring that the process for developing a trade policy and trade strategies includes effective stakeholder engagement and is gender-inclusive, with a focus on helping the poor.
Closely linked to the trade policies and sector strategies is an analytical study called the Diagnostic Trade Integration Study (DTIS), which has been produced in 31 countries with the EIF's support. This evidence-based study enables countries to analyse their macroeconomic outlook, potential business and regulatory reforms, trade in services, trade facilitation, and competiveness. The effective use of the DTIS is imperative if LDCs are to have a clear strategy for mainstreaming trade into their national development plans and productive sector strategies. It is also vital in identifying bankable projects aligned with the identified priorities for future interventions from donors and development partners and/or for foreign direct investment.
The EIF also provides catalytic support to these bankable projects. As of now, the EIF has supported 40 such projects in 29 countries. These projects address sectoral and cross-cutting priorities with potential for development that empowers people, especially the poor, to both participate in, and benefit from, economic growth through job creation, increased revenue and facilitation of a constant income flow.
An overwhelming majority of these projects focus on export productivity increases and export-oriented business development, specifically targeting MSMEs. The 189 MSMEs that have been supported by the EIF have created employment in labour-intensive sectors, including agro-processing, services in the tourism sector, and the textile and apparel industry, all of which have a high level of participation by women.
To list but a few examples, in the Gambia three cashew processors have adopted new packaging technologies which have enabled them to sell to local supermarkets and hotels. Improvements in horticultural production in Lesotho has led to a monthly cash income of US$80 for farmers who previously earned very little. In Burkina Faso, 1,020 new jobs were created in 2016 at 17 new dried mango processing units, leading to increased exports. Between 2014, when the project was initiated, and 2016, exports of dried mangos increased from US$3.9 million to US$10.2 million, translating into growth in exports of 160 percent. In Zambia, 6,580 beekeepers (30 percent of them women) have been trained in improved beekeeping methods, leading to at least a 60 percent improvement in the quality of the honey.