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Mobilizing and Implementing Aid for Trade

Example: The European Union’s complex aid approval and disbursement procedures CARICOM countries receive some of the most useful trade assistance through EUfunded agencies such as ProInvest, CDE and CEDA. However, the potential value of this assistance is reduced substantially as a result of the EU’s complex aid procedures. Two examples—one regional and the other national—serve to illustrate the problems that countries experience. In February 2004, the CRNM received grant funding for improving regional capacity in trade and economic negotiations. The agreement was due to expire in January 2005. However, owing to a combination of factors, including delays in implementation of the 9th EDF Caribbean Integration Support Programme the programme had to be extended five times. The final disbursement of funds was made in April 2007. During the period when no funds were available, the CRNM had to seek alternative sources of funding and postpone or cancel meetings. Another example is in regards to the EU’s Support to Dominica for the Banana Industry, 2004–2007 (US$6.6M). The banana farmers were initially pleased to hear the announcement about the aid they would receive for re-structuring. However, after waiting a very long time for the assistance, they eventually left the land since they had to find alternative ways of feeding their families. In this latter case, ensuring that procedures were followed appeared to be more important than meeting the objective of helping the banana farmers. The EU’s cumbersome procedures are well known and documented. In an evaluation of European Community support to the private sector in five countries ( Jamaica, Mexico, Morocco, Vietnam and Zambia) covering the period 1994–2003, the following comments were made [1, p. 35]: Two factors inhibit the efficiency of many European Community programmes: the complexity of EC procedures and the delays incurred at different stages of the programme cycle…..procedures are slow and heavy to the point that several sources declared their preference for working with other donor agencies. 3.4. Implications for Future ‘Aid for Trade’ The above discussion highlights a few points that should be borne in mind in any future ‘aid for trade’ programme: a. There is an urgent need for donor harmonization in the region—to avoid duplication of efforts, to reduce conflicts during implementation, to simplify disbursement and reporting procedures, to coordinate needs assessment exercises, and to ensure that the needs of countries are met. b. Although it is recognized that each donor has its own interests, countries should not allow donors to impose their objectives in programme planning;

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mobilizing aid for trade: focus on latin america and the caribbean: proceedings of the regional r...  

this report was prepared by the integration and trade sector (int) as a contribution to the regional meeting on mobilizing aid for trade: la...