EU Offers Both Trade And Aid
BRUSSELS, Oct 2: The Pakistani delegation in a recently-concluded UN World Summit on Sustainable Development in Johannesburg strongly argued in favour of getting a better opportunity to draw benefits from international trade.
The delegation, comprising ministers, officials press, men and women, pointed to the many obstacles preventing business in Pakistan and in all of South Asia from exploiting commercial opportunities to lift themselves out of poverty.
The EU agreed on the importance of developing countries’ full integration in the world economy. Indeed, the EU has always believed that increased trade is essential to fight poverty for the benefit of current and future generations.
We do not believe this means developing countries have to choose between trade and aid. Both are important. This is maybe one of the most important lessons we draw from Johannesburg, and indeed it is a strong message coming from all three recent major international conferences: In Doha, the WTO launched a new trade round centred on development: the Doha Development Agenda. In Monterey, the UN Conference on Financing for Development stressed the importance of securing effective and predictable financing for trade related development programmes. And in Johannesburg, the UN World Summit on Sustainable Development spelled out the need for mutually supportive trade, development and environment policies.
The EU is getting organised to offer trade and aid in a more coherent manner. On the trade policy side, this means continuing to pursue development objectives - both unilaterally (as in the Everything But Arms initiative to eliminate tariffs and quotas for least developed country exports) and multilaterally in the Doha Development Agenda, where we are committed to negotiating a development friendly outcome with respect to market access and multilateral trade rules. On the development cooperation side, it means stepping up efforts to target donor money to help partners draw effective benefit from market access. The EU is already quite active in giving trade related assistance.
Over the last five years, 640 million euro were spent on more than 100 trade- related assistance projects in developing countries. But now, the EU has decided to take a step further. On 18 September 2002, the EU published an action plan on how to respond to developing countries’ clear calls in Doha, Monterey and Johannesburg for more trade-related assistance. The Action Plan, which we will discuss with EU trade and development ministers, and the European Parliament over the autumn, sets out a series of concrete steps.
First, we will discuss with countries such as Pakistan whattheir own priorities and needs are. We won’t pursue a “one size fits all” policy. Countries have different priorities, different needs. For example, many land-locked African countries lack sufficient roads to transport their agricultural products to the market. Building such transport infrastructure can transform the economy. The message is that we are ready to increase trade related assistance as our partners see necessary, and we will both monitor closely how much money goes on trade projects, and then review trade-related assistance overall in 2005.
Second, we will help trade officials and operators to find their way through the red-tape of international trade. We will work with partner countries to help them comply with food safety rules. And we will work directly with governments - to help train their negotiators and administrators, and to develop “sustainability impact assessments” on the environmental and social impact of trade proposals.
In this regard we are proposing in our 2003-2005 programme of cooperation for Pakistan a programme for trade development which should include, among other components, training and capacity building on WTO issues as well as trade facilitation and customs reform.
Third, we will work to improve the coherence and delivery of trade related assistance. All donors must work together to ensure that countries like Pakistan are getting what they need in terms of trade-related assistance from different sources.
We have put particular attention to make certain that our proposed cooperation with Pakistan in all areas is the result of both coherence with EU policies and complementary within the EU and with other donors.
This means reversing the focus from who gives what to who gets what. The WTO is going in this direction, and the international community as a whole has to work more coherently than in the past. For example, we are increasingly concerned that the lending policies of Bretton Woods institutions sometimes undermine agreed development policies by imposing ever tougher commercial conditions in their lending policies to developing countries.
The fact is that trade and development policies have the capability to deliver enormous change. Everything But Arms, the EU’s quota and tariffs-free trade regime for the Least Developed Countries has meant that many of those countries are now attracting more international investment to develop their export capacity precisely because they have free access to the EU market.
The EU believes that trade should be in the service of development and that is our goal, most immediately in the Doha Development Agenda. The EU heard the message from its partners at the conferences in Doha, Monterey and Johannesburg. We agreeto offer both trade and aid.
*** Poul Nielson is EU Commissioner for Development and Humanitarian Aid. Pascal Lamy is EU Trade Commissioner. **
