The African Development Bank’s Contribution to Aid for Trade (AfT)
Kennedy Mbekeani
NEPAD, Regional Integration and Trade Department
3rd Meeting of Trade Ministers of Landlocked Countries
Swaziland, October 21-22, 2009
African Development Bank Group 2
1. Specific Issues for LLDCs
2. The AfDB’s Contribution to AfT• Financial and Technical Assistance:
o Operational Activitieso Capacity Buildingo Knowledge Products
• Institutional Support to AfT Processo Monitoring and Evaluationo Advisory Groups
3. The Way Forward
Outline
African Development Bank Group 3
• Challenges– Infrastructure
RoadsRailMaritime
– Transit and Trade Facilitation
Specific Issues for LLDCs
African Development Bank Group 4
Infrastructure Missing Links Road Network
African Development Bank Group 5
African Ports
African Development Bank Group 6
Solutions
• Potential Solutions• Regional approach to deal with cross-border constraints
Road and rail networkPort infrastructureRationalization of the RECs
• Harmonization of policies
African Development Bank Group 7
The AfDB’s Contribution to AfT
AfDB’s Contribution to AfT
Institutional Support to AfT ProcessFinancial and Technical Assistance
Operational
Activities
Capacity
Building
Monitoring
and
Evaluation
Advisory
Groups
Knowledge
Products
African Development Bank Group 8
Financial and Technical Assistance:Operational Activities
• Infrastructure accounts for over 75% of the AfDB’s activities.
- In 2008, the AfDB invested nearly US$ 2.2. billion in infrastructure:
45.4% on transport
37.8% on power supply
16.8% on other infrastructure
- Multinational infrastructure also supports regional integration.
• Investments in infrastructure have been scaled up.
- The AfDB has supported projects such as the North-South Corridor, as well as projects within corridors.
North-South Corridor: US$ 600 million for 2009-2012 to support activities in the corridor.
Nacala Corridor US$181 million.
African Development Bank Group 9
Financial and Technical Assistance:Capacity Building and Knowledge Products
• Capacity Building
Training of trade policy officials, especially through the African Development Institute.
Support to trade facilitation programs to increase cross-border trade and regional integration.
• Productive Capacity building
- Agriculture Sector: 2006 in US$336 million; 2007 US$230 million
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Financial and Technical Assistance:Capacity Building and Knowledge Products
• Trade Development
- Trade Finance Initiative: Provision of emergency funds to support trade:
US$ 500 million in the form of lines of credit to African financial institutional to support trade finance operations.
US$ 500 million in the Global Trade Liquidity Programme, which will be jointly implemented with the IFC and other DFIs.
• Knowledge Products
The AfDB conducts studies and reports on markets and trade in Africa (i.e. African Competitiveness Report).
African Development Bank Group 11
Institutional Support to AfT Process
• Monitoring and evaluation
– Monitor and report AfDB’s financial commitments.
Finalized the OECD donor questionnaire
Assisted member countries in completing the OECD questionnaire
– Participate and support national and regional AfT reviews
First regional review was held in Tanzania in 2007.
Eastern and Southern Africa sub-regional review was held in Lusaka in April 2009.
Regional reviews are planned for West, Central, and North Africa
– Participate in the AfT Global Review conducted by the WTO
• Advisory Groups
– WTO AfT Advisory Group
– Africa AfT Working Group
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The Way Forward
• The AfDB recognizes the importance of Aid for Trade in support of the trade liberalization agenda and its capacity to foster economic growth.
• The AfDB is committed to playing a leadership role in the implementation of the AfT in Africa by:
– Addressing soft and hard infrastructure constraints through operational activities;
– Assisting in institutional capacity building;
– Providing knowledge;
– Enhancing the monitoring and evaluation agenda to show the impact of AfT;
– Sharing lessons with other donors, member countries and regional economic communities.