Aid for Trade: Its role in WTO negotiations and in long-term development

A series of research seminars funded by the ESRC has addressed the implications of increasing trade for labour markets, including employment, wage inequality and conditions of work. One recurring theme is that labour market flexibility is required to adjust the economy to trade liberalisation or to use opportunities created by trade negotiations. Current WTO negotiations introduced the concept of ‘Aid for Trade’, to help countries address adjustment and trading costs. Aid for Trade also may mark a shift in aid priorities towards support to production.

The WTO Task Force on Aid for Trade must report in July. The aim of this seminar was to bring together policy makers, development agencies, NGO representatives, academics and other experts to discuss:

Aid for Trade in the WTO

• How has the Aid for Trade Task Force defined it, what progress has been achieved so far and what issues are still outstanding?
• What are the possible institutional and financial characteristics?
• Should Aid for Trade be focused on adjustment, e.g. addressing preferences, or should it also address supply-side constraints such as infrastructure and skills development?
• Should it have a regional or a national focus?

Possible Long-Term Implications of Aid for Trade for Developing Countries

• Will the new prominence of trade in aid lead to more support for productive capacity in development programmes?
• Will it lead to helping labour markets to adjust to trade liberalisation?
• What would national or regional Aid for Trade programmes look like?