Report on Meeting
Global Enhanced Integrated Framework (EIF) Workshop for Focal Points
8-10 July 2009, Centre William Rappard, Geneva

I. Introduction

1.  This first EIF Global Workshop for EIF Focal Points, Donor Facilitators (DF) and EIF partners marked the long-awaited operationalistation of the EIF. In fact, HE Dr Anthony M. Maruping, Chair, EIF noted that full operationalisation had been achieved when the Interim Board approved funding of the first two Tier 1 projects in Sierra Leone and Yemen on 2 July 2009. As a technical framework for the strengthening of LDC’s capacity building in their integration in the multilateral trade system, the main objectives of the EIF could be summarised in five points, to: 1) overcome the weaknesses of the IF; 2) enhance countries’ ownership; 3) build a more solid governance structure; 4) reinforce partnership amongst government/private sector/civil society/donors, and 5) intensify South-South cooperation.

2.  During the inauguration, Ms Dorothy Tembo, Executive Director, EIF Executive Secretariat (ES), announced and presided over the signing of an agreement between ITC- UNCTAD-UNOPS, under the supervision of a representative of the EIF Trust Fund Manager (TFM). This new agreement aims to accelerate the evaluation procedure and to put in place a more efficient mechanism for the “unlocking” of funds.

II. Objectives and summary of the meeting

3. This workshop paved the way for implementation of the EIF on the ground. In a spirit of high level interaction amongst all participants through a series of nine modules or short presentations of specific aspects of the EIF, as well as two additional small group sessions [note 1]. The latter sought to facilitate sharing of experiences amongst colleagues and EIF partners while it allowed for establishing useful EIF networks for the future.

III. The EIF—introduction and Preparations (Module 1)

4. Following the introduction made by Mr Félix Mutati, Minister of Commerce, Trade and Industry, Zambia, where he enumerated the three pillars underlying the EIF: 1) infrastructure; 2) border facilitations issues, and 3) behind-the-border issues [note 2], Mr Mbaye Ndiaye, IF Board Member, Senegal, underscored the salient points leading to the enhancement of the IF, based on IF evaluations results. These were the: 1) inability of the IF to integrate trade priorities in Poverty Reduction Strategy Papers (PRSP); 2) lack of ownership of programmes by LDCs; 3) insufficient capacity building in the recipient countries; 4) inadequate financial resources; 5) need of improved coordination amongst agencies, equally applicable to 6) the evaluation and monitoring aspects.

5. In the words of Mr Edward Brown, IF Board Member, United Kingdom, a firm and continuing belief that the IF can play a vital role in stimulating economic growth, and in turn alleviate poverty; the realisation that focusing purely on Market Access for recipient countries was not sufficient, and the need to empower LDCs to determine their own priorities, and taking control of this process by choosing their cooperating partners were the arguments that motivated donors four years ago to redesign the EIF, to ensure that it will deliver results for LDCs. This last aspect of the enhancement process implied the selection of the right Donor Facilitator (DF), with whom a regular and frank dialogue could be held.

6. Along this lines, Mr Oscar Kass, Finland, DF Zambia, shared his experience in the field and added that the main roles played by the DF is to liaise between the national government and the cooperating partners by building awareness of the EIF and mobilising funds for DTIS implementation, as well as to provide strong commitment—time and resources—in support to the EIF process. He concurred with Mr Brown on the statement that LDCs should be clear about what they want because there is a temptation on the governments’ side in being too soft. He commented on the progress of the EIF process in Zambia, considered an element of the high profile Government’s programme. He highlighted the fact that awareness of Cooperating Partners (CP) is small but growing as virtually all donor agencies—except Japan International Cooperation Agency (JICA)—have signed a Memorandum of Understanding (MOU) as a tool for in-country Trade-Related Technical Assistance (TRTA) coordination.

7. On the recipients’ side, Mr Adel Alghaberi, Focal Point, Yemen, took stock of the state of play as regards the EIF process in the country. Fuelled by a strong need for policy formulation, harmonisation of donor activities and most notably its trade integration into the world economy—Yemen is the smallest recipient of ODA in the world—the EIF is operational since the completion of its DTIS in 2002-03. Three projects under the EIF umbrella have been approved since 2005, in order to address fundamental problems such as the country’s AFT approach, donor coordination, DTIS updating, as well as greater inclusion of the private sector into national trade strategies.

IV.  EIF Trade Mainstreaming at policy, institutional and donor relations level (Module 2)

8. Mr Charles Gore, UNCTAD, highlighted that ten years ago aid was linked to trade by donors to support their own trade. Only in the last five years there has been a shift in the paradigm in the scope of trade mainstreaming. Some of the poverty reduction schemes cited were Brazil’s and India’s Employment Programmes. Trade mainstreaming is a matter of ownership of the macroeconomic framework as part of the development strategy. In other words, it is up to the country to select its trade strategies, and the public/private sectors to elaborate policies accordingly. Nonetheless, he noted a widespread lack of linkage between trade policies and the macroeconomic framework, due to the “narrow” ownership of this framework by the Ministry of Trade in many countries—rather than an inter-ministerial approach. Further, there is a tendency to make trade policy projections for exports, while trade policy import projections are virtually nonexistent.

9. Mrs Luisa Bernal, UNDP, pointed out that analytical work in the area of trade mainstreaming is highly needed, namely at the national development plans level, since there is a tendency that trade and Poverty Reduction Strategy Papers (PRSPs) remain general and most of them make the linkage between trade and income solely. There is a greater need for LDCs to take ownership of poverty reduction processes, as well as the importance of enhancing capacity building at the national level to drive the process of trade mainstreaming. She acknowledged that the EIF Steering Committee as well as the DTIS, and Tier 1are acquiring importance in the effort.

10. Mr Bernard M. Hoekman, Director, International Trade Department, World Bank, observed four conditions for success in trade mainstreaming: 1) to advocate for the trade agenda by mobilising specific stakeholders; 2) to coordinate and communicate regularly and extensively within the Government; 3) to build a consensus (in cabinet, parliament) around a programme of action focused on improving trade performance, 4) to define and prepare projects focusing on incentives, infrastructure, and institutions—at and behind the border. In addition, a Sector Wide Approach (SWAp), in the WB’s terminology, has proven to be an effective mechanism in defining a trade framework, by making cross-cutting reforms, building capacity development and implementing sector-specific projects. The above should be accompanied by other good practices such as serious accountability and independent assessments of outputs and outcomes which measure changes over the baseline needed to mobilise support for moving forward and make the necessary adjustments.

11. During the discussion session, some delegations acknowledged that mainstreaming is a challenge that they face as a state undergoing economic and structural reforms, while others emphasised that strategies are not sufficient for mainstreaming trade into national policies. These should be accompanied of a trade policy and the country’s own appropriation of the projects. Only one mention was made concerning the importance of embracing women in the trade and poverty eradication processes.

12. During the lunch break, participants were invited to follow a presentation by Ms Meg Jones, International Trade Centre (ITC), concerning the EIF process as an ideal platform for the gender dimension inclusion into trade strategies (i.e. in the DTIS), and mitigating poor efforts in this respect.

V.  EIF National Implementation Agreements (Module 3)

13. During this module, it became clear that trade mainstreaming into national development policies would only be possible if the necessary national implementation agreements are put into place. Mr Dieudonné Ouefio, Coordinator, Central African Republic (CAR), described in detail his country’s experience regarding the admission in the EIF programme in 2005, and leading to the implementation of nine IF projects to date. As far as the constraints they have faced in this process, one finds the delay in the procedure of disboursement by cooperating partners, the financial crisis, and the potential impact on overall Official Development Assistance (ODA).

14. Mr Jo Scheuer, UNDP Donor Facilitator, Cambodia, shared some of the lessons learned from the implementation mechanism. Cambodia is an interesting study case as one of the most fragmented countries in the world, in terms of development partners—only during 2007, one could find 759 ongoing development projects in the country. In 2005 the Cambodia Government realised that a revision of the DTIS was needed, and the updated version is the 2007 DTIS; subsequently a Trade SWAp was adopted. Under the EIF, the Department for International Cooperation was created. In his view, two crucial structures are needed: inter-ministerial and Government-Private partnership, as well as “up-front” support from the DF’s in the early stages.

15. Mr Ajesh Patel, Private Sector Representative, Zambia, focused on the Private Sector Development (PSD) Reform process programme whose principle is to carry out reforms across various sectors of the economy aimed at creating the right environment expected to lay the foundation for a vibrant private sector and an attractive business climate—including a greater inclusion of women in this process. As part of this reform process, the Trade Expansion Working Group (TEWG [note 3]) (whose secretariat is the EIF’s NUI), was created. The TEWG is most notably responsible for 1) overseeing implementation of all trade-related activities/programmes, including IF and ATF; 2) coordinating delivery of the actions identified in the DTIS Action Matrix and thus acts as the EIF’s National Steering Committee, and 3) advising on amendments and endorses proposals formulated by the EIF’s NIU. In relation to the challenges which have proved to be a strain on the private sector’s efficiency, inadequate capacity in Trade Policy amongst some stakeholders, especially those outside Government, as well as the diversity of issues and tight time frames were pointed out.

VI. The role of the EIF in regional integration (Module 4)

16. The discussion was centred around possible entry points for the EIF in the context of regional integration. Mr Bernard M. Hoekman, highlighted the many ways in which regional cooperation can improve national competitiveness. These include: 1) elimination of duplicative regulations and procedures; 2) competition promotion by integrating product markets through liberalization and mutual recognition; 3) sharing of fixed costs of regulatory bodies, and 4) reduction of trade costs through joint infrastructure.

17. Both the WB’s old and new agendas on trade facilitation are needed for successful results, the former concentrates on TR infrastructure and customs reform and modernisation, while the latter looks at cross-cutting issues and quality and efficiency of service providers. As a complement to the EIF by working with regional bodies, the WB-managed Trade Facilitation Facility (TFF)—financed by the UK, The Netherlands, and Sweden—includes a focus on regional projects for specific corridors or to build capacity. TFF procedures will be designed to ensure coordination with IF Focal points and donor coordination mechanisms. Although it will have an emphasis on Africa/low-income countries, governments of developing countries and regional organisations are eligible to apply for TFF funding. In this respect, demand for support in other regions such as Central Asia and Central America [note 4] has already been identified.

18. Mr Mark Pearson, Programme Director, Regional Trade Facilitation Programme, examined the importance of the North-South corridor [note 5] project in reducing transport costs for landlocked countries (LLDCs), and facilitating trade (c.f. cutbacks in port and border crossing waiting times, poverty reduction and unemployment), in the eight countries it covers, out of which five are LDCs (with the exceptions of Botswana, South Africa and Zimbabwe). It was acknowledged that concerned LDCs’ DTIS Actions Matrices are instrumental in linking transport programmes to regional scale efforts. There would be a useful leverage obtained in implementing trade facilitation, trade policy and trade-related issues in the Action Matrices as part of the regional agenda. This would improve lock-in, raise the countries’ political profiles and would allow access to regional financing mechanisms. On the way forward front, National Focal Points and EIF stakeholders are important actors in exploring new alternatives to advance this process. Substitute ways to finance implementation of Action Matrices and Monitoring and Evaluation (M&E) at the regional level could prove a useful tool in this regard.

19. Mr Mohamed Fofana, Focal Point, Guinea, raised the issue of the need to create a specific EIF envelope to fund regional projects. He illustrated his point through a practical example in the West Africa region, where ineffective fruit fly control on mangoes in recent years, had caused losses on the overall production of 36 per cent in Senegal, and 95 per cent in Mali and Benin, with an ultimate negative effect on the number of trading partners. The increased awareness that this problem had to be dealt with regionally, mainly due to financial constraints in dealing with problem at national level, led to the elaboration of a roadmap setting up the different financial responsibilities of each partner country. In drawing up the regional project, the realisation of various challenges was made evident: 1) lack of funding available for a regional project within the EIF; 2) the absence of engagement of all development facilitators came up; 3) poor institutional framework for dialogue and communication; 4) the need for harmonisation of sub-regional legal frameworks, and 5) increasing human resources.

VII.  EIF Project and Programme Implementation (Module 5)

20. During this session, Mrs Christian Kraus, EIF Executive Secretariat, made a review of the tools through which the Secretariat supports beneficiary countries in the implementation process, noting that ownership and partnership remain the backbone of the EIF. These include: 1) setting up IF/EIF National Implementation Arrangements; 2) preparing a multi-year EIF programme (i.e. prioritisation and sequencing of actions); 3) preparing/revising Tier 1 project proposals, and 4) implementing the EIF programme or Tier 1 project.

21. On the EIF’s financial and fiduciary fronts, Mr Jairo Morales, UNOPS, highlighted the mandate and functions of the Trust Fund Manager (TFM), which started operation as of September 2008. This body is rigorous in the application of operational principles (i.e. accountability, effectiveness, efficiency, sustainability, and transparency) in the 49 beneficiary countries, and supported by three regional offices in Bangkok, Dakar and Nairobi (soon Johannesburg, South Africa). The financial outlooks is as follows, USD 68,699,653 in contributions had been made as of June 2009 from which USD 5,445,852 have been already allocated. The funding available for Tier 1 and 2 projects is USD 63,253,801. Thus far, thirteen capacity assessment missions have been undertaken, for which two reports have been submitted.

22. Mr Pan Sorasak, Secretary of State, EIF Focal Point, Cambodia, shared his country experience in project development, as one of the pilot countries in 2001. The country’s first DTIS was launched in 2002 and subject to a review in 2007, in order to take stock of Cambodia’s successful integration into the world economy. The EIF Tier 1 proposal was developed over one year, starting with the definition of the national EIF strategy in January 2008 and culminating with the submission of the EIF Tier 1 proposal to EIF Executive Board in July 2009.

23. The awareness of insufficient implementation and weak monitoring through this review led to the adoption of a more coordinated approach for implementation, namely the SWAp tool discussed under Module 2. Mr Seth van Doorn, European Commission, Cambodia, showcased the Trade SWAp, as a new way of delivering TRTA under a sector-wide approach, where trade is the sector. The Trade SWAp enabled 1) increased attention for overall policy coherence; 2) improved planning, coordination, monitoring; 3) a stronger role for government, and 4) more attention to capacity building. Nonetheless, it was recognised that there is a risk of losing focus on results if efforts towards coordination do not strike the right balance. In the case of Cambodia, the idea was to tie up existing institutions instead of creating new structures and modalities. The results include a broad donor engagement, and the establishment of a Trade Development Trust Fund (USD 30 mill approximately). Challenges faced during the implementation of the new coordinated approach relate to the fact that not only Government has a bigger role, but also individual donors stand to lose both individual control over design/implementation and access to funding, as well as individual visibility and credit for results.

24. Amongst the best practices and food for thought four major needs were brought to the EIF Secretariat’s attention, specifically,1) the need for flexibility as pertains the design of the implementation that better meets the country-specific needs in keeping with the Paris Principles on Aid Effectiveness; 2) for consideration of LDC status by recognising the “up-front” technical assistance investment required to put in place various building blocks even before a Tier 1 proposal can be developed; 3) for training and guidance, by organising training on specific elements of project proposal development and other trade mainstreaming actions, and 4) for developing a standard Tier 1 and 2 project proposal methodology and post it on a dedicated website in English and French.

VIII. Financing of IF Action Matrix and beyond- Build on the AFT Review’s deliberations on funding (Module 6)

25. Mrs Khemmani Pholsena, Lao PDR, presented the sources in support of the national IF structure, from bilateral in-country donors, to the locally managed trade-basket and direct budget funds, and the multi-donor (Australia, the EC and the WB) trust fund called Trade Development Facility (TDF). A relatively new mechanism, the TDF has committed funding of approximately USD 6.82 mill over four years. Its scope is aligned with the five DTIS Action Matrix priority areas: 1) export competitiveness; 2) trade facilitation; 3) business environment; 4) trade policy, and 5) trade opportunity for the poor.

26.  Ms Raine Dixon, AusAID, Donor Facilitator in Lao PDR, coincided with Mrs Pholsena in that the difference was made between recipient country and donor’s ownership, and noted that both are equally important. The challenges highlighted in taking the TDF forward included 1) government limited capacity; 2) donor coordination and competing interests; 3) donor capacity to pool funds; 4) slow progress; 5) reluctance to come under the trade “umbrella” (since there are donors who would like to focus on private sector development), and 6) fear in fending off unsolicited donor proposals, when the interests at stake are not.

27. Ms Manuela Tortora, UNCTAD, presented the Inter-agency Cluster on Trade and Productive Capacity, which was launched as a support to the EIF during UNCTAD XII in 2008 in Ghana, and comes under the Delivering as One label, which builds on the existing UN reform agenda. Through a pragmatic, flexible, action-oriented approach, the 13 UN agencies grouped in the cluster—including FAO, UNDP, UNEP, UNIDO, WTO, etc.—this initiative seeks to build competitive productive capacity, by using trade as an engine for development. Until 2005, the United Nations Development Assistance Framework (UNDAF), four-year programmes, tended to marginalise the international development agencies. Through the Cluster, eight pilot countries (e.g. Mozambique and Rwanda), and other countries which have showed interest in this mechanism are given the opportunity to insert this new component of UN developmental assistance grounded in the DTIS and the UN country processes with a view to ensuring ownership.

IX.  EIF Monitoring and Evaluation (Module 7)

28. Mrs Julia Betts, Performance Assessment Resource Centre (PARC), introduced this section by laying out the general principles of M&E. She explained that in an era of great amounts of aid flowing, there is greater need to demonstrate impact, effectiveness and results as well as an increased pressure on countries on the effective use of resources. M&E is an opportunity not a constraint to measure progress, showcase achievements and results, sharing knowledge, and it requires commitment and a spirit of partnership and cooperation of all stakeholders. In this process three key frameworks—the Paris Declaration, the OECD’s DAC principles and the Accra commitments—complement the main principles of M&E: 1) integration, constructive, rather than extractive; 2) cross-cutting issues and contribution to change; 3) country-specific and global-aggregated approach, and 4) capacity building.

29.  Ms Dorothy Tembo, reminded the participants of the origins of the M&E tools in the context of the EIF. The Task Force recommended an EIF M&E Mechanism to monitor progress in achievement of EIF-supported activities. The one-year process culminated with the final approval of the EIF Framework by the Board on 1 April 2009. This covers all EIF-related activities, amongst which promotion of accountability, effective M&E—at programme, country and project levels—as well as knowledge sharing make up the core of it. Success of EIF M&E is dependent on clearly defined roles and responsibilities of all the different EIF partners [note 6].

30.  Ms Peggy Mlewa and Mr Maybin Nsupila, Ministry of Commerce Trade and Industry, Zambia, stated that their country’s position on M&E rests on two main documents which spell out Zambia’s long-term development plan under the Vision 2030 overarching strategy,which is to“become a prosperous Middle-income country by 2030”: 1) The Fifth National Development Plan (FNDP) focuses on several sectors, including trade, and 2) The Private Sector Development Programme (PSDP). Under the former, the road to establishing the M&E under the Trade Chapter has not been smooth, and needs to be strengthened further, one of the reasons being the very narrow use of indicators (e.g. only the “Volume of Trade”), while the latter demonstrated not having an elaborated M&E. However, the Government of Zambia plans to reinforce this process by 1) involving quarterly reporting, and 2) mid-term and final evaluations for the different projects under implementation. The lessons learned regarding the M&E requires significant time, human and financial resources, and advised against creating separate EIF M&E frameworks, given that EIF provides a good starting point. By way of concluding, Ms Mlewa noted the significant strides in designing an M&E framework that will contribute to successful implementation of the EIF, namely through capacity enhancement within the NIU, FP and the TEWG (discussed at length under Module 2).

X. Agency presentations on how and in what areas they can support DTIS Action Matrix implementations (Module 9)

31.  In the words of Mr Mark Gawn, Canada, “the EIF is a partnership consisting of the clients, donors and agencies who bring to the partnership a set of resources”. Along these lines, representatives from several organisations brought forward their agencies’ implementation practices of DTIS Action Matrices.
32.  Mr Willem Van Der Geest, ITC, pointed out that 24 projects have been implemented in twenty LDCs, under the EIF’s umbrella. ITC’s new institutional strategic framework has committed half of their work to be directed to LDCs through sustainable development promotion, export expansion, and a unique mandate that lies on bringing in the private sector, as much as possible, as well women.

33. The concluding remarks made by at the 2nd Global Reivew on AFT the Permanent Representative of Switzerland “Implementation, implementation, implementation”, and those of WTO Director General, Mr Pascal Lamy “the EIF is now fully operational” found echo in Mr Masoumeh Sahami’s, UNCTAD, opening statement. He added that UNCTAD delivers its mandate through three pillars: 1) Research and Policy Analysis; 2) Capacity Building and TA [note 7], and 3) Inter-governmental Service and Consensus Building.

34. Mr David Luke, UNDP, addressed questions regarding the main areas for UNDP’s support on implementation of Tier 1 and 2 which concentrates on the inter-agency coordination in the field. With this in mind, they have developed two specific tools used to impact assessment of Trade policies on 1) human development and on the 2) capacity building. Both bring the gender dimension very strongly into their work.

35. Dr Bernardo Calzadilla, UNIDO, highlighted the Organisation’s supply-side approach to form strategic partners with UN agencies and donors with the objective of mobilising additional resources. In 2007 LDCs Ministerial Conference requested UNIDO to take special account of the needs of LDCs, and UNIDO was welcomed implementing partner and granted observer status at the meeting of the EIF Interim Board on 14 May 2009. The signature of the agreement whereby this agency “will make an essential contribution through its expertise in the area of trade capacity building” took place on 24 June 2009. Most recently, through the review of the supply side needs in the Action Matrices of thirty LDCs, 664 supply-side measures were identified in 8 categories.

36. Mr Richard Newfarmer, WB, addressed the issue of how to use the EIF so that LDCs “unlock” global markets. With the provision of provided USD 2bill to LDCs in the form of policy analysis, infrastructure projects in 2008, the Bank faces important challenges. Poor communication between finance minsters and his cabinet on proposals, and the fact that trade ministers is rarely at the table in these discussions are important shortcomings in providing services and financial services. The EIF can be the key in funding competitiveness programmes, and funding for pre-feseability projects. A real secret is placing demand on WB staff, and convince the Finance Minister and the Country Director to sit down with EIF stakeholders. Countries which have done this effectively are Burkina Faso, Lesotho, and Rwanda. Conversely, Cape Verde, Gabon, Swaziland have been less successful in this regard.

37. Mr Panos Antonakakis, WTO, highlighted the role of the WTO in providing a spotlight on the Standards and Trade Development Facility (STDF)—a joint initiative the FAO, the World Organisation of Animal Health (OIE), WB, WHO, WTO. This aims at enhancing expertise/capacity to analyse/implement SPS standards, and a vehicle for coordinating technical assistance on SPS norms [note 8]. Under a mandate to allocate 40 per cent of its resources to LDCs, current collaboration between the EIF and the STDF, takes place through both project funding and project development having to do with SPS issues (eligible any SPS-related organisations and agencies are public/private and NGOs), and which are embedded in the DTIS AM. LDCs contribute to the governance of this mechanism through their representation within the STDF Working Group. Other potential EIF-STDF partnerships concern the development of SPS indicators, preparation of SPS-related sections in DTIS as well as desks reviews in this same vein.

XI.  The way forward for in-country EIF implementation (Module 11)

38. A general feeling of concern amongst the beneficiary countries—irrespective of the EIF stage they are at—in approaching the following aspects stood out: 1) establishment of the NIU; 2) the identification of a DF; 3) financing ongoing activities while new funds are disboursed; 4) the ability to communicate with Geneva-based partners in French; 5) weak national structures, and 6) non-continuity of the DF (i.e. in this regard participants advised that he/she stayed at least 3 years on the ground).

39. The recommendations that came out of the group meetings where technical assistance was further needed covered: 1) speeding up approval Tier 1 phase and DTIS process; 2) possibility of annual regional meetings; 3) mainstreaming gender and youth issues—which is poorly reflected in the DTIS; 4) in-country donor coordination; 5) convening the inter-ministerial task force that would help formulation of a pipeline of projects; 6) having dissemination workshops; 7) harmonising the various reporting requirements, and 8) strengthening the pivotal roles of Focal Points and DFs.

40. Ms Dorothy Tembo concluded that the EIF is an important tool to advance LDC’s trade and poverty reduction agendas. The EIF success lies to a great extent on finalising Tier 2 guidelines as soon as possible, the degree of regional integration achieved, as well as the political involvement reached. The EIF ES’s commitment in organising workshops (at the national and regional levels) and information was maintained. The Secretariat will consolidate all the reports and will come up with an Action Programme addressing M&E activities, finalisation of Tier 2 guidelines, and continuation of Tier 1.

Acronyms