Trade monitoring
Aid for trade in Action
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.
Conclusion
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.
Acknowledgements
This publication was prepared by Visvanathan Subramaniam (Economic Affairs Officer WTO) and Michael Roberts (Head of the Aid for Trade Unit of the Development Division WTO) under the supervision of Deputy Director-General Xiangchen Zhang and Taufiqur Rahman Director of the Development Division. The publication was edited and reviewed by Anthony Martin and Helen Swain of the Information and External Relations Division.
Overview of the Aid for Trade initiative
The Aid for Trade initiative led by the WTO grew out of the 2005 WTO Hong Kong Ministerial Conference. Its aim is to help developing economies integrate into world trade by mobilizing additional development support to address supply-side capacity and trade-related infrastructure constraints in these economies. In 2006 the Task Force on Aid for Trade was constituted by the WTO Director-General to report to the General Council with recommendations on how to operationalize Aid for Trade.
Opportunities for trade integration in clean energy value chains
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).
Executive summary
Energy generation infrastructure has long been identified by Aid for Trade stakeholders as requiring additional predictable and sustainable financing to enable developing economies and LDCs to participate more fully in international trade. The energy sector is one of the largest recipients of Aid for Trade support accounting for nearly 25 per cent of all disbursements (US$ 116 billion) over the 2010-21 period.
Report by WTO Secretariat
Located in the Horn of Africa Djibouti is a least developed country (LDC) and has been classified by the World Bank as a lower-middle-income country. It had a gross national income per capita of USD 5610 in 2020. Its geographical location port infrastructure and political stability make it a major maritime hub and have prompted several countries to establish military bases there. Revenue from the bases and from port activities has fostered the emergence of a modern segment of the economy that coexists with a large informal sector. However the high cost of production factors and the strong presence of public companies continue to hinder the country’s economic development. Given Djibouti’s narrow production base international trade is fundamental for the country which relies almost exclusively on imports to meet its domestic demand for most goods and some services. Thanks to the infrastructure (especially ports) re-exports far outstrip exports.
Report by Djibouti
The Republic of Djibouti is a State in the Horn of Africa located on the Red Sea and bordered to the north by Eritrea to the north-west west and south by Ethiopia and to the south-east by Somalia. The territory is delimited by 370 kilometres of coastline the population is estimated to be 1 million and the country has no natural resources.
Trade Policy Review: Djibouti 2022
“Trade Policy Reviews" analyse the trade policies and practices of each member of the WTO. The reviews consist of three parts: an independent report by the WTO Secretariat a report by the government and the concluding remarks by the Chair of the WTO’s Trade Policy Review Body. The opening section - "key trade facts" - provides a visual overview of the WTO member’s major exports/imports main export destinations origins for its imports and other key data. This edition looks into the trade practices of Djibouti.
Introduction
The Trade Policy Review Mechanism (TPRM) was first established on a trial basis by the GATT contracting parties in April 1989. The Mechanism became a permanent feature of the World Trade Organization under the Marrakesh Agreement which established the WTO in January 1995.
Report by United States
As we undergo our fifteenth trade policy review the United States affirms that our priorities at the WTO and in the global trading system are more important than ever. We are leveraging our core values of fairness inclusivity growth and sustainability to navigate the myriad complex challenges we find ourselves in today: a pandemic response violent conflict initiated by one WTO Member against another supply chain shortages and environmental concerns.
Trade Policy Review: United States of America 2022
“Trade Policy Reviews" analyse the trade policies and practices of each member of the WTO. The reviews consist of three parts: an independent report by the WTO Secretariat a report by the government and the concluding remarks by the Chair of the WTO’s Trade Policy Review Body. The opening section - "key trade facts" - provides a visual overview of the WTO member’s major exports/imports main export destinations origins for its imports and other key data. This edition looks into the trade practices of the United States of America.
Report by the Secretariat
The United States has a large economy that is highly integrated with the rest of the world. After a period of stable economic growth in 2018 and 2019 when real GDP expanded by 2.9% and 2.3% respectively the U.S. economy suffered the effects of the COVID-19 pandemic. Real GDP contracted by 3.4% in 2020 after 11 consecutive years of expansion. The economy experienced a rapid rebound in 2021 aided by the support packages put in place by the Government and by an easing of monetary conditions. This led to a real GDP growth rate of 5.7% in 2021.