• Aid for trade

Aid for trade

What are the next steps that need to be taken as interest in the Aid for Trade (AFT) agenda gathers steam? This short article argues that it is of fundamental importance that the AFT mechanism itself has a pragmatic and concrete legal and institutional framework to ensure that the AFT agenda:

• will be fully implemented to meet the stated objectives
• will have a broader mandate to encompass trade-related adjustment costs
• doesn't involve a trade-off with other types of development aid, i.e. to ensure ‘additionality’ of AFT resources rather than reshuffling of existing aid
• doesn't divert attention from key development issues of the Doha Round

In particular the article argues that:

• AFT should have a concrete institutional and legal architecture that ensures, in a legally enforceable way, additionality of money; respect to recipient countries’ development priority, trade policy and negotiating positions; transparency and predictability
• developing countries need to ensure that aid cannot be a substitute to a fair and balanced trading system. Therefore they need to stress the need for the creation of an institutional and legal framework with an effective monitoring and enforcement mechanism in order to ensure that AFT plays a complementary role in the development of developing countries

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