Brainstorming Meeting on the Substantive Preparation for LDC IV

MOBILIZING INTERNATIONAL SUPPORT FOR LDCs

New York, 15 July 2010

Rob VosDirector

Development Policy and Analysis DivisionUN-DESA

e-mail: vos@un.org

Existing international support measures for LDCs

A. Official Development Assistance: Financial flows and technical assistance Bilateral and multilateral donors Special targets under MDG 8 (0.15-0.20% of DAC

member GNI)B. International trade: Special and Differential Treatment in WTO

obligations Market AccessC. Other forms of support: Caps in contribution to UN budget, discounts in

contributions to PKO Travel funds

Other Since 1981, support by development partners

framed by the Programmes of Action for LDCs

Current status of international supportOfficial Development Assistance

Aid targets have not been met GAP: $23-43 billion (0.06 – 0.11% of donor GNI)

Aid remains highly fragmented and volatile (though improvements in some cases)

Enhanced Integrated Framework Trust Fund reached $100 million in 2008

Aid for Trade to record level, but top 20 recipients in 2008 included just three LDCs

SDT for LDCs in the WTO Provisions Not well utilized due to lack of understanding and

effectiveness Not all LDCs have access (32 LDC WTO Members) Accession negotiations remain complex and lengthy

Market Access No full DFQF Actual market opening had little effect on increasing LDC

market shares and export diversification since 2004 LDCs face the challenge of preference erosion Restrictive Rules of Origin and other non-tariff barriers

Limited results from international support Goals too ambitious in relation to support

measures… …or, support measures inadequate to meet

ambitious goals

Difficulties in strategy implementation owing to inadequate external support, misguided domestic policies, poor governance, and random shocks.

Programs of Action overemphasized international measures whose impact on growth, poverty alleviation and graduation has not been convincingly demonstrated.

International support measures necessary but not sufficient to address the structural handicaps affecting LDCs:

many important (domestic and international) obstacles to development were neglected.

Strengthening existing international support

ODA Reiterate target of 0.15 per cent of GNI for LDCs, but

…. … align more fully behind national development

strategies to better fit country needs (see WESS 2010)

…. provide ODA mostly in form of budget support (covering gaps in financing the NDS)

to reduce transaction costs and reduce fragmentation of aid

… provide ODA through multi-annual agreements aligned with medium-term expenditure frameworks

to enhance predictability of aid flows Recognition of non-traditional donors in the new aid

architecture Define clearly additionality of new financing needs

(for climate change, food security, disaster relief).

Strengthening existing international supportTRADE

Aid for Trade and IF Increased funding needed to respond to country-based

formulations of trade-related needs and priorities (as part of NDS’s)

EIF is a promising initiative and should be expanded

SDT WTO agreements SDT provisions should be simplified, meaningful and more

effective (i.e. better tailored to country needs) Accession of LDCs should be further facilitated.

Market Access Accelerate progress towards full implementation of DFQF Creation of more simplified and harmonized rules of origin Removal of non-tariff barriers Increasing South-South collaboration

More tailor-made approach needed

Need to articulate tailor-made national and international responses for each LDC:

Alignment behind NDS’s Principles for allocation and SDT could be set in

function of types of key vulnerabilities (CDP clustering idea):

LDCs with low land productivity LDCs vulnerable to environmental & economic shocks LDCs involved in, or exiting from, a conflict

Better framework for smooth transition strategies needed for graduating countries

EBA extensions one of few elements available Increase the knowledge on available

support measures DESA - Development account project

Additional international support and considerations

Enhancing policy coherence across international development strategies and related support measures:

MDG strategies and PRSPs Climate change adaptation and mitigation (financing, technology

transfer) Food security

More realistic alignment of new BPoA targets and the international support measures that are made available

Debt relief: continued heavy debt burden of some LDCs requires action from creditors

Extending HIPC initiative Deliver more ODA as pure grants

Include support measures from large developing country partners and NGOs

Annex

Aid for Trade increased to record level of $42 billion

Aid for Trade Commitments (2008 dollars)

0

5

10

15

20

25

30

35

40

45

2002-2005 2006 2007 2008

25

28

31

34

37

40Trade-related adjustment

Trade policy and regulations

Building productive capacity

Economic infrastructure

Percentage of total sector-allocable aid

B Bac

Large gap remains in providing duty free access

Proportion of developed-country imports from developing countries and LDCs admitted free of duty (percentage)

60

65

70

75

80

85

90

95

100

2000 2001 2002 2003 2004 2005 2006 2007 2008

Developing countries, excl. arms and oil LDCs, excl. arms and oilDeveloping countries, excl. arms LDCs, excl. arms

DFQF Target

B Bac

Enhanced market access has not led to greater export diversification(Concentration index: 1 = extremely

concentrated)

B Bac

x

Use of survey results - Information portal fact sheets

Uganda

Multilateral donorsTrust Funds- NAPA: received $199,790.GEF grant for implementation of action plan in 2003.- UNCDF: District Development Programme, 2008 - 2012: $2,000,000. more

LDC SPECIFIC ODA

Technical assistance received:SIDA has provided specialised training for officials from Uganda Export PromotionBoard, Uganda Revenue Authority, Department of External Trade, and Ministry ofFinance.Training for government officials also received from COMESA and WTO.

Preferential treatment from developing countries:India, China, Korea, Kyrgz Republic,Turkey,Tajikistan, Uzebekistan, Russia

more

Market Access

AccessionDate of accesssion: 1 January 1995.

Compliance with WTO agreementsIn 2005, Uganda together with other LDCs realised that they were notgoing to be able to implement the TRIPS Agreement within the requiredgrace period that had been granted to them.A request to extend the transitional period for another 15 years wasmade to the TRIPS Council. In 2005, the TRIPS Council agreed toextend the transitional period for the implementation of the TRIPSAgreement to 2013. LDCs were requested to submitt to the TRIPSCouncil their technical and financial requirements necessary for theimplenetation of the TRIPS Agreement.

technical and/or financial assistance received to enhance SPS-related capacity:General capacity building on the SPS Agreement funded by MTTI andWTO; training to the flower funded by the Netherlands/EU;Development of the manual on Good Agricultural Practices forflowers by Netherlands/EU.

more

WTO Provisions

http://www.un.org/esa/policy/devplan/ldcproject.html

B Bac