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Enabling Developing Countries to Participate in International Trade Strengthening the Supply Capacity Gradual but good progress in reducing tariff and quota barriers to trade
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Participate in International Trade
Strengthening the Supply Capacity
Special initiatives for developing country exports (ACP country access to EU; “Everything but Arms” initiative; AGOA)
However, until now a very limited supply response from developing countries.
Opening borders is essential but not sufficient!
The Issue:
Most developing countries (and their potential exporters) do not have the capacity to deal with international standards, technical regulations and requirements
Two main reasons:
Without capacity to deal with them, they become a real obstacle to DC exports and thereby to production and investment
Standards and Regulations
Both specify that Technical Assistance was to be provided to DCs to enable conformity assessment procedures and compliance standards and regulations
TBT and SPS Agreements
Very few internationally recognized testing capacities in DCs
Very limited participation in international standard setting, international professional bodies
Potential exporters have to use overseas services for metrology, testing and analysis, at high cost and with delays
Current situation:
Perception that many standards are "imposed" by industrialized countries
Standards and regulations can be used as non-tariff barriers, DCs lack capacity to analyze problems and solve; in a weak position to argue
High cost and delays i.a. through duplication of conformity assessment and testing procedures
These factors make exporting for many not viable
IMPLICATIONS FOR DEVELOPING COUNTRIES
Building on UNIDO strengths in “technical infrastructure” and sectoral expertise;
Now one of three main priorities of UNIDO: “Trade Capacity Building”, attracting increasing funding.
UNIDO Initiative: Enabling Developing Countries to Participate in International Trade- Strengthening the Supply Capacity”
Combined with assistance to high export-potential sectors to upgrade product/ production quality, comply with standards and regulations for exports;
Increasingly integrate investment/partnership promotion and export consortia of SME.
Trade Capacity Building
MOU with the World Trade Organization (joint programme);
agreements with ISO, BIPM, OIML, ILAC, IAF, IEC;
cooperation with ITC/UNCTAD.
Cooperate with regional (integration) organizations (e.g. UEMOA, SAARC, COMESA); promote common standards and sharing of key facilities at regional level.
Trade Capacity Building
Due to hygiene and other safety concerns a major market banned imports, resulting in 50% loss of exports and 60,000 job losses.
Integrated assistance to improved processing, better quality inspection and setting up recognized laboratory services enabled restart of exports in 1999
An example
Project funding (over $ 55 mln.) from:
European Commission: € 22 mln. for UEMOA, Pakistan, Bangladesh
Norway: $ 3.6 mln. for Sri Lanka, Mekong countries, SAARC
Switzerland: $ 5.3 mln. for Vietnam, Tanzania, Mozambique
Italy: € 3 mln. for Egypt (traceability); € 10 mln. for Algeria, Argentina, Tunesia, Uruguay and Syria
Austria: $ 0.8 mln. for Cambodia
France: € 2.5 mln. for Algeria and Senegal
Self financing: $ 2.1 mln. Nigeria and Guatemala
Under negotiation: €14 mln. UEMOA II/ ECOWAS, $ 5 mln. for Central America and Lebanon, second phases for Sri Lanka, Mekong countries, SAARC etc.
Funding 2001-2005:
