Aid for Trade Conference Opens in Dar es Salaam

01/10/2007
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Aid for Trade Conference Opens in Dar es Salaam

Kaberuka Underscores importance of Private Sector in Aid for Trade Agenda

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Tunis, 1 October 2007  – A high-level conference on Mobilizing Aid for Trade: Focus on Africa, opened on Monday in Dar es Salaam, Tanzania, with emphasis on the need to provide meaningful support to African countries and help the continent to obtain its fair share of the proceeds of Global trade.

President Donald Kaberuka of the African Development Bank Group,  Pascal Lamy of the World Trade Organization, Abdoulie Janneh of the UN Economic Commission for Africa and other prominent participants, spoke on the need to leverage aid to develop trade infrastructure, policies and practices to enable the continent to participate effectively in global transactions.

"We are here to concreticise the work of the Hong Kong Ministerial (conference)… to mobilize the commitments, to mainstream trade in our national plans, align donors and the private sector to that agenda, agree on delivery modalities for aid for trade and mechanisms of evaluation," Mr. Kaberuka told more than 300 finance and trade ministers, senior donor representatives, regional institutions and key private sector actors who began discussions on trade-related challenges in the region and priorities for action.

Mr. Kaberuka said that in spite of the encouraging performance of a number of African countries largely spurred by rising demand for commodity prices, the underlying economic conditions were still fragile.  Structural weaknesses remain, the AfDB President said, as he called for a mutual and complementary response by governments and donor to enhance trade in African countries.

He highlighted the Bank Group’s efforts in supporting trade and regional integration in its member countries, with commitments in the last three years reaching US$ 531 million for initiatives that include major corridors and regional public goods. "We have stepped up our private sector lending which has tripled to over 1 billion dollars in this year alone," he pointed out.

Opening the conference, Tanzania’s Vice President, Mr. Ali Mohamed Shein, spoke on the need for greater, predictable and well targeted aid for trade, saying that Africa – whose global trade share stood at 1.5% in 2004 and at 1.7% in 2005 – generally remains a negligible player in world trade .

He said that resources for aid-for–trade can only be meaningful if they are untied and not just reallocation or repackaged support from other existing programmes such as education or health. They should be predictable, demand-driven and with fewer conditionalities.

Besides, the Vice President said, African countries must meet certain obligations in order for them to benefit from aid for-trade. These includes continuation of economic reforms to sustain macroeconomic stability, good governance and the rule of law, improved public financial management and accountability, infrastructure in the transportation, energy, water and sanitation sectors. Africa must also invest in health and education to generate the kind of human capital that can make a difference, he added.

On his part, the Director-General of the World Trade Organization, Pascal Lamy, said the conference was about helping countries in Africa build the capacity they would need to expand trade and integrate into the global economy. "It is part of a broad initiative – launched at the WTO’s 2005 Hong Kong Ministerial Conference – to scale up international financial assistance for trade capacity building in developing countries", he said.

The Executive Secretary of the UN Economic Commission for Africa (UNECA), Mr. Abdoulie Janneh, cited a range of trade-related challenges facing the continent including the integration of trade into national development strategies and improved ability to negotiate and implement trade outcomes. 

"At the same time, more roads, electricity grids, telecommunications, ports, irrigation and laboratory testing facilities are required to underpin production and exchange.  Aid for trade should also help to create a good business environment and to help countries to meet adjustment costs of trade liberalization", he said.

He emphasized the importance of aid for trade in efforts to overcome the limitations of Africa’s small, fragmented economies and intensify the process of regional integration. Africa has 15 landlocked states that depend on unreliable transportation systems in neighboring countries for access to ports and markets.

World Bank President Robert Zoellick addressed the conference through a taped message in which he said aid for trade was critical to Africa’s development and poverty reduction and as such, will receive the Bank’s full support.

The Bretton Woods institution was represented by its Vice President for Africa, Mrs. Obiageli Ezekwesili while Elizabeth Tankeu, Commissioner for Trade and Industry of the African Union, represented the President of the AU Commission, Mr. Alpha Omar Konare.

The agenda of the two-day conference includes a ministerial dialogue on "Why Aid for Trade Matters for Africa", and three break-out sessions on Mobilizing Aid for Trade in West Africa, Central Africa, East and Southern Africa, and North Africa, respectively.

Other discussions are focusing on the "Investment Climate Facility for Africa" initiated by the AfDB and partners, "Development Dimensions of Aid for Trade", "Leveraging Africa's Regional Development Banks" and a concluding "Open Dialogue" on a roadmap for action.

The Dar es Salaam conference is the last of three regional meetings held this year within the context of the "Aid for Trade" initiative launched in December 2005 at the WTO Ministerial Conference in Hong Kong. The other two conferences were held from September 13-14 in Lima, Peru, for Latin America and in Manila, Philippines, for Asia and the Pacific region from September 19-20. The outcomes of the three regional meetings will be included in the WTO’s Aid for Trade Review session in Geneva on 20-21 November 2007.