Wednesday, May 09, 2007

EU strategy on Aid for Trade: EC communication and working paper

In the beginning of April, the Commission adopted a communication entitled 'Towards an EU aid for trade strategy - the Commission's contribution'. Together with a staff working document, the Communication was transmitted to the Council of ministers who will discuss it at the GAERC meeting of 14 and 15 May. This Communication is the Commission's contribution to further expanding EU support for Aid for Trade, with a view to the adoption of a joint EU strategy by the Council in the second half of 2007, as agreed by the Council in October 2006.

The communication states that "Aid for Trade is a key complement to trade negotiations. It is not a substitute for a pro-development outcome of these negotiations but should be delivered independently of progress in the negotiations. The Communication also refers to the fact that as the Council drew specific attention to the Aid for Trade needs related to the ongoing negotiations of Economic Partnership Agreements (EPAs) with ACP countries, the EU strategy should pay similar specific attention to these developments, in order to help realise the full development potential of EPAs". It seems to be the intention of the Council of ministers to include a commitment to the fact that the EU will strive to increase its trade related assistance to 2 billion per year (1 billion from the EC and 1 billion from the MS) by 2010 in the Conclusions on EPA negotiations that will be adopted at the same GAERC meeting.

On that specific commitment to significantly increase trade related assistance in the coming years, the Commission's makes the following recommendations:
  • A linear trend from the present situation to their 1 billion target would imply that the collective commitments to TRA by EU Member States should rise to at least € 600 million by 2008;
  • The EU strategy should underline the importance of integrating trade-related concerns into national development strategies and identify criteria for when it is acceptable to finance trade-related priorities in anticipation of national development strategies being updated.

Chapter 5 of the Communication is devoted to the specific ACP angle of the strategy with, among others, the following recommendations:
  • The EU strategy should provide guidance on the amounts involved in the Council's commitment to allocate a "substantial share" of the additional TRA to ACP countries with a view to increasing the share of overall TRA allocated to the ACP.
  • The strategy should include a political commitment on the part of the EU to strengthen its support for traderelated infrastructure, productive capacity and trade-related adjustment, starting by supporting good coverage of such wider issues in trade needs assessments.
  • The strategy should outline how to strengthen support to regional trade needs assessments, in support of regional integration. In the EPA context, this includes a particular emphasis on the EPA Regional Preparatory Task Forces.
  • The strategy should indicate a priority to EPA regions as regards coordinating delivery modes and supporting regionally owned initiatives, such as regional EPA funds.
Other chapters of the strategy refer to enhancing quality of aid for trade, monitoring and reporting and EU capacity for aid for trade.

Source: EU News - Issue 3, May 2007 (APRODEV, CIDSE, Caritas Europa).

See also Euforic dossier on EU cooperation.