GENEVA: The WTO-led Aid for Trade initiative has contributed US$648 billion since 2006 to strengthen the export potential of developing economies and least-developed countries (LDCs). The impact of the initiative in improving these economies’ capacity to trade is revealed in a new publication – ‘Aid for Trade at a Glance 2024’ – launched by the WTO and the Organisation for Economic Co-operation and Development (OECD) on 26 June.
Aid for Trade disbursements and commitments surged in 2022, the latest year when data are available, surpassing pre-pandemic levels. Disbursements reached an all-time high of US$ 51.1 billion – a 14 percent year-on-year increase in real terms. Commitments increased by 31 percent to reach a peak of US$ 65 billion.
Over 55 percent of Aid for Trade is provided by bilateral donors, primarily countries that are members of the OECD Development Assistance Committee. Other Aid for Trade financing is mostly provided by multilateral donors, such as the World Bank and the Asian Development Ban
k. In 2022, the top donors included Japan (US$ 11.1 billion – about one fifth of total Aid for Trade disbursements), followed by the World Bank (US$ 7.9 billion) and EU institutions (US$ 6.8 billion).
Africa and Asia are the main geographical destinations of Aid for Trade, accounting for 70 percent of total flows. By income level, lower middle-income economies are the main recipients of Aid for Trade, representing US$ 19.8 billion (38 percent of total disbursements), followed by LDCs and other low-income economies, which accounted for US$ 14.1 billion (28 percent) in 2022. Since 2006, LDCs have received a total of US$ 189 billion in Aid for Trade.
Aid for Trade projects comprise three main types: (i) economic infrastructure (i.e. roads, ports, telecommunications), which accounted for 54.6 percent of funding in 2022; (ii) productive capacity building (support to productive sectors with high export potential), 43.6 percent; and (iii) trade policy and regulations, 1.8 percent.
Within these three categories, t
ransport and storage attracted the highest share of funding (27 percent), followed by energy generation and supply (23 percent), agriculture (18 percent) and banking and financial services (12 percent).
Source: Emirates News Agency