USAID chief announces scale up of trade facilitation alliance

Devex
By Adva Saldinger

A port in Santos, Brazil. Photo by: Alan / CC BY-NC-ND

WASHINGTON — The Global Alliance for Trade Facilitation, an initiative aimed at helping countries reduce import barriers, will scale from four to 20 countries, U.S. Agency for International Development Administrator Mark Green announced Tuesday.

“We believe that private enterprise is the only sustainable way to lift lives, to build communities, and so we’re dedicated to working to find ways to ease the barriers for businesses to participate,” Green told a crowd of business leaders at the U.S. Chamber of Commerce Foundation’s Corporate Citizenship Conference.

Green said the agency is looking to more often collaborate, co-finance, and co-design programs, tools, and initiatives with the private sector, and highlighted the alliance as a public-private partnership that demonstrates that new way of delivering assistance.

“For the first time companies through the alliance have a say in determining the countries where assistance dollars will be spent and what activities will actually take place,” he said.

The alliance, which includes the U.S., Australia, Canada, Germany, and the U.K. — as well as the World Economic Forum, the International Chamber of Commerce, the Center for International Private Enterprise, and a number of companies — is governed in large part by a steering group made up of donors and a rotating group of companies. While companies do have a say in determining which countries the alliance will work in and which projects it will undertake, there are extensive rules of engagement and lengthy decision-making processes to prevent self-interest, a USAID official told Devex.

To choose this new list of countries, for example, the alliance went through a “fairly long process” where each member prioritized countries of interest. Then, with an eye to geographic diversity and having a mix of developing and emerging economies, they narrowed it to the 20 countries where the alliance will pursue work with over the next several years.

The alliance has thus far worked in four pilot countries — Vietnam, Colombia, Kenya, and Ghana — but will expand to work in 20 countries in the next months or years. While not all of the new countries have been identified — in part because conversations with local stakeholders are at an early stage — the list includes Argentina, Brazil, Morocco, and Sri Lanka.

Most of the new countries are developing countries, the USAID official said, but there are some emerging markets partly because in those cases, the private sector was more willing to spend money and because their engagement is key to the sustainability of the alliance’s work, he said.

In Brazil, for example, the alliance sees a double benefit. It will not only help a country that has significant challenges in trade facilitation, but when they have a reformed customs and import system, they can serve as a model for other countries in the region, the USAID official said.

The announcement of the expansion will not require USAID to spend additional funds, as it announced a contribution of $50 million over several years when the alliance launched and does not intend to add additional funding. Rather, USAID hopes to make the alliance sustainable and hand off responsibilities to the private sector, the USAID official said.

The alliance, which was launched to help countries adopt the World Trade Organization’s Trade Facilitation Agreement, largely measures it success based on how well countries adopt the provisions of the agreement, he said.

“This is good for business, but we believe it’s just as good for development,” Green said in his speech. “The future of international development is enterprise-driven and we at USAID, working with all of you, will embrace it.”