Development and building trade capacity

Aid for Trade seeks to enable developing economies and in particular least-developed countries (LDCs) to use trade as a means of fostering economic growth sustainable development and poverty reduction. It promotes the integration of developing economies especially LDCs into the multilateral trading system and aims to galvanize support to build supply-side capacity and trade-related infrastructure in these economies to improve trade performance. This publication draws on the responses provided by participants to the questionnaire of the 2024 joint OECD–WTO Aid for Trade monitoring and evaluation (M&E) exercise which underpins the 2024 Global Review of Aid for Trade. It presents an analysis of the M&E questionnaire responses and provides information on Aid for Trade financing flows up to the year 2022. Drawing on the responses to the survey it describes priority areas for the Aid for Trade Initiative for 2024 and the coming years.

This publication is the result of a joint effort of the OECD and the WTO and was prepared under the overall guidance of Michael Roberts (Head Aid for Trade Unit Development Division WTO) and Olivier Cattaneo (Head of Unit Architecture and Analysis Development Co-operation Directorate OECD). WTO Deputy Director-General Xiangchen Zhang Taufiqur Rahman (Director of the Development Division WTO) and María del Pilar Garrido Gonzalo (Director for Development Co-operation OECD) supervised the work. The publication was edited and reviewed by Ross McRae and Anthony Martin of the Information and External Relations Division of the WTO and by Henri-Bernard Solignac Lecomte Head of Communications of the OECD Development Cluster. Additional contributions were provided by Masato Hayashikawa (Development Co-operation Directorate OECD).

The transition to clean energy offers opportunities for developing economies and least-developed countries (LDCs) to exploit the export potential of this transition and to accelerate their growth prospects. The WTO-led Aid for Trade initiative provides significant support to these economies to help them develop their energy sectors and transition to clean energy. However sustained support is required to ensure that firms benefit from the trade opportunities that will emerge as a result of the clean energy transition. This report highlights the role that Aid for Trade can play in mobilizing financial resources to deliver targeted assistance and to help developing economies unlock export opportunities created by clean energy. It also underlines the role of development partners in helping firms integrate into clean energy value chains by investing in the production of clean energy technologies such as green hydrogen and solar power.

The clean energy transition is critical to achieve net zero goals and is a key element of most economies’ nationally determined contributions under the Paris Agreement to keep global warming under a 1.5° Celsius threshold. The clean energy transition also has trade integration potential as it helps to advance industrial development and addresses capacity constraints in energy generation capacity.

Nearly 40 per cent of anthropogenic GHG emissions are caused by burning fossil fuels to produce electricity (IEA 2022b). Decarbonizing electricity generation is a critical step toward achieving net zero goals. Target 7.2 of the UN Sustainable Development Goals (SDGs) calls for a substantial increase in the share of renewable energy in the global energy mix by 2030 (UN General Assembly 2015).