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Trade

Making trade fair for everyone – including the world’s poorest.

Sharing the benefits of trade

In the Central African Republic, moving a container from a factory in Bangui, the capital, to the nearest port and getting through customs takes 116 days. In Denmark it takes five days. On average, transport costs in Southern Africa are 73% higher than in the EU. For African fruit and vegetable exporters, this kind of delay seriously threatens their competitiveness.

Developing countries face big challenges to improving their prospects for growth through trade:

  • High transport costs
  • Cumbersome export processing procedures
  • An absence of supportive policies and regulations
  • Inadequate export and trade negotiating skills
  • Poor product standards
  • Lack of energy, telecommunications and transport infrastructure.

Aid for Trade

Aid for Trade is a joint venture between donors and developing countries to help developing countries overcome trade barriers – and to benefit from the global economy. It includes the crucial reforms, investments and policies that help drive sustained and inclusive growth that ultimately helps to reduce poverty. Aid for Trade is needed now more than ever, as it addresses both short and long term needs.

The UK launched an Aid for Trade Strategy in 2008, which sets out to:

  • Help boost trade – through funding and assistance to upgrade trade-related infrastructure, cut transport costs, improve the trade and investment climate, and support expansion and diversification of agricultural exports.
  • Ensure that trading and growing nations have the capacity to develop social and economic policies that enable the opportunities and benefits of trade and growth to be shared widely among their populations.
  • Get donors to put more emphasis on trade in their work on growth, and to provide additional resources to help developing countries undertake necessary trade sector reforms, investments and adjustment.

The most appropriate Aid for Trade measures, and those that will have the biggest impact, will vary from country to country. That is why Aid for Trade has to be demand driven – led by the needs of each country, and in line with clearly defined national and regional priorities.

The EU and G8 are making Aid for Trade a priority in the fight against global poverty – the UK will be contributing more than £400 million annually by 2010, most of which will be invested in Africa.

Links

Farm-workers in Ghana load pineapples on to a truck bound for market

Farm-workers in Ghana load pineapples on to a truck bound for market.

We know that the benefits of trade are unevenly spread, and that the poorest countries have been marginalised for too long.

Douglas Alexander Secretary of State

Fighting Poverty Index