Boosting Export in Developing and Transition Economies:

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• Boosting Export in Developing and Transition
  Economies
• The Role of ITC
• Sok Siphana
• Director, Resources and Partnership Group
• Bureau of Policy and Programme
• OFID Headquarter, Vienna, 7 March 2008

ITC Your Development Partner in Export Success
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We are based in Geneva
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We are half World Trade Organization (WTO)
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We are half UN Conference of Trade and
Development (UNCTAD)
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But our main clients are the private sector
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• ITCs Comparative strengths confirmed by
  independent evaluation
• Specific TRTA mandate
• Convening power with private sector
• Leader in trade development and strategies
• Business aspects of trade development
• Strong technical competencies

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External forces....
.The Doha Development Agenda is about more
than trade. It is about reducing poverty,
promoting growth, and helping developing
countries to integrate into the global economy.
  Pascal Lamy, WTO Director-General
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The Doha Development Agenda and Aid for Trade
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WTO General Council Meeting on Aid for Trade
(November 2007) - Roadmap for 2008
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A shared burden and shared opportunities

• Aid for Trade and the EIF are guided by the Paris
  Declaration on Aid Effectiveness

• Trade and Growth agenda responsibility of Trade
  and Finance Ministers

• International Organizations, Development Banks,
  International Financial Institutions

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ITCs Role in Aid-for-Trade
Aid for Trade Agenda
ITCs Strategic Objectives
Strengthen policy-makers ability to integrate
business into the global economy
Strengthen trade promotion institutions
Make enterprises more competitive
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Role of ITC and the Private Sector in
Aid-for-Trade
Private sector as Advocates
Strengthen policy-makers ability to integrate
business into the global economy
Strengthen trade promotion institutions
Make enterprises more competitive
Private sector as Beneficiaries
Private sector as Partners
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Role of Private Sector in Aid-for-Trade
Annual World Export Development Forum (WEDF),
Montreux

• Aid for Trade Regional Reviews in 2007
• Peru, Manilla, Dar es Salaam
• More national and regional reviews in
  2008

Private Sector as dialogue and advocates
partners
Private Sector as beneficiaries
Private Sector as knowledge and know-how
partners
Private Sector as financing partners
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Diversifying the economy andbroadening the
export base is crucial for many developing
countries, particularly for LDCs
Concretly, and ultimately, what does it mean?
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getting the products to the shelves...
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Getting the Ethiopian leather products to the
markets.
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getting the clients to their destinations...
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getting the services to the clients...
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.What sectors?Which products ?

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Areas of support

• Advise on best practices in procurement and
  supply chain management to ensure cost-effective
  use of resources.
• Provide tailor-made advice and support for
  product development and adaptation, promotion and
  market development covering priority sectors such
  as textiles and garments, wood and wood products,
  artisanal products, beverages, leather and
  leather products, organic products, fruit juices,
  fruit and vegetables, fibres and spices.

cashew ?.
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organic rice ?.
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coffee ?.
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Cosmetics?
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other markets ?.
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• Geographical constraints
• Different levels of trade integration
• Weak Trade Support Institutions (TSIs)
• Severe supply capacity constraints (quality
  inconsistency, co-ordination of produce
  aggregation, synchronization of harvests, cooling
  platform, various logistics requirements)
• Network of Overseas Trade Representatives
  under-utilized
• Lack of pro-active marketing approach
• Trade promotion organizations under-resourced and
  not sufficiently responsive to needs of
  enterprises

Similar Challenges
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What our customers want
Policy makers

• Understand the international trade rules
• Get ready to negotiate at international level
• Interact with their national government
  counterparts
• Help operationalize at private sector level

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What our customers want
Trade Support Institutions

• Institutional capacity building
• Networking

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What our customers want
SMEs

• Provide an economical and political framework
  conducive to exports
• Help in making enterprises export ready
• Help grow enterprise export competitiveness at
  international level

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How ITC assists countries diversifyITC 5 Core
Competencies
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How do we do it
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Policy for exports

• Assist decision makers to establish institutional
  frameworks and mechanisms that improve the
  business and trade environment

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The complexity of export success..
COMPETITIVE PRODUCT OR SERVICE
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Export Strategy

• Provide methodologies and tools for
• designing and implementing export strategies

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Single commodity product expertise Gourmet
Coffee Guide.. and now Cotton Guide
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TSI strengthening

• Develop the capacity of trade support
  institutions
• to support exporting SMEs

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Exporter competitiveness

• Assist SMEs and communities to reach global
  markets with products and services

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Enterprise Competitiveness
Managing ICT applications
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Diversification depends on adequate advisory
services and tools to support enterprise
competitiveness
I n f o r m a t i o n / T r a i n i n g
Negotiate and draft contracts
Understand thebusiness implications of the
tradingsystem
Assess thecompetitive position and trade
potential of the enterprise
Produce quality products and meet
standards of international markets
Ensure and manage trade finance
Trade Support Infrastructure
Package and label
Resort to arbitration/ mediation services
P r o d u c t s / M a r k e t s
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SMEs and Export Packaging.
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The right packaging.
Hides skins
Handicrafts
Cut flowers
Fish Seafood
Dried Fruits Vegetables
Chemicals
Fresh Fruits Vegetables
Herbs Spices
Food
Natural products
Oilseeds
Castings forgings
Furniture
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Lots of mandatoryregulatory information
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Meeting the buyers

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Branding
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Visibility.
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Export competitiveness means concretly bringing
clients to the market and generating concrete
export contracts.
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Sri Lanka
1.
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Cambodia Silk

 
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Cambodian Golden silk

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Bangladesh
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Trade at Hand in Burkina Faso
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Cotton Izmir Mercantile Exchange, Turkey
Business Networking Event
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Cut Flowers A Multi-million Dollar Industry in
China
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Export Market Diversification and Poverty
Reduction The Case of Horticultural Sector in
Mali
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Export Market Diversification and Poverty
Reduction The Case of Horticultural Sector in
Mali
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Exposure of Malian Exporters to international
markets
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Impact more than 500000 families in Mali depend
on horticulture related production for their
livelihood
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Trade Intelligence

• Build capacities in trade information services by
  providing market analysis and intelligence

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Wide range of analytical and information tools
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National Export Performance
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Trade Performance Index
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Export promotionPerformance of industries in
Viet Nam
Underperformerin attractive markets
Performerin attractive markets
Furniture
Cashewnuts
Plastics
Underperformerin unattractive markets
Performerin unattractive markets
Coffee
Dairy products
Rice
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Promising sectors in Viet Nam
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World Importers of Cardamom
Unit Value
Growth rate
Countries
Global market share
Value
Quantity
Tariff and Non-Tariff Barriers
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Access barriers to Pakistans market

• Tariff Barriers

• Non-Tariff Measures

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Assess the competition in export markets
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List of importing countries for a product from
Guatemala
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Mangoes imported by Japan at the tariff line level
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Trade data over five years
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Analyse potential for bilateral trade
Select your countries/regions
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Existing and potential trade between Tanzania and
United Kingdom
at the HS 6 digit level
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Investment Map Homepage
http//www.investmentmap.org
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Investment Targeting Priority sectors (Brazil)
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Forging Ahead
Strengthening Partnership between ITC and
International Financial Institutions (IFIs)
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ITC Core Competencies and IFIs
The OIC Context as a case study
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OIC Objectives in terms of Trade Development

• Increase the OIC Trade from 13 to 20 by 2015
• Move up in the global value chain
• Diversify the economy base and the exports
• Develop the capacity to trade

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Appreciating the geographical diversity of the
OIC Member States

• The 57 OIC members are from four different
  continents/regions
• Africa 27 members
• Asia 27 members
• Americas 2 members
• Europe 1 member

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Top 10 OIC exporters in terms of value
Source TradeMap. Data refer to 2006.
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Intra OIC Trade
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Major product groups exported by the OIC countries
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Major product groups traded within OIC member
countries
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A number of OIC countries have substantial
diversification with respect to products and
markets
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Making market access barriers transparent
European trade policy preferential agreements
G.S.P.
Bilateral
L.D.C.

Sri Lanka
Nepal
Afghanistan
Albania
Andorra
Malaysia
Bangladesh
A.C.P.
Armenia
Cambodia
Macedonia
Mexico
Yemen
Georgia
Maldives
Lesotho
Cape Verde
Croatia
Togo
South Africa
India
Bulgaria
Bhutan
Samoa
Botswana
Argentina
Ethiopia
Bosnia
Ctrl. Afr. Rep.
Senegal
Chile
Laos
Sao Tome
Romania
Zambia
Myanmar
Tuvalu
Burkina Faso
Angola
C.A.C.M.
Honduras
Tonga
Benin
Madagascar
Kiribati
El Salvador
Sudan
Guatemala
Solomon Isl.
Nicaragua
U.S.
Eq. Guinea
Uganda
E.E.A.
Costa Rica
Malawi
Mali
Vanuatu
Countries Fighting Drugs
Gambia
Comoros
Guinea-Bissau
Haiti
Norway
Burundi
New Zealand
Pakistan
Iceland
Somalia
Niger
Tanzania
Rwanda
Guinea
Mauritania
Liechtenstein
Eritrea
Bolivia
Chad
Hong Kong
Liberia
Mozambique
Sierra Leone
Djibouti
E.F.T.A.
Ecuador
Switzerland
Andean Group
Venezuela
Kenya
Peru
Zimbabwe
St. Lucia
Suriname
Seychelles
Dominica
Colombia
M.F.N. W.T.O.
Barbados
Congo
Nauru
Dominican Rep.
Antigua
Australia
Korea, Rep.
Namibia
Gabon
Cuba
U.A.E
Kyrgyzstan
Swaziland
Congo Dem.Rep.
Jamaica
Cook Isl.
Cameroon
Canada
Qatar
Guyana
Trinidad
Taiwan
Indonesia
Palau
Mauritius
Thailand
St. Vincent
Bahrain
Micronesia
Ghana
Grenada
Uruguay
Tokelau
Singapore
Brunei
Macao
Marshall Isl.
Ivory Coast
Nigeria
Japan
Kuwait
Brazil
Papua
Oman
Mongolia
Belize
Montserrat
Bermuda
St. Kitts
Niue
Israel
Morocco

Egypt
Moldova
Bahamas
Fiji
Panama
Turkey
China
Uzbekistan
Tunisia
Philippines
Yugoslavia
Paraguay
Jordan
Belarus
Korea, Dem. Rep.
Russia
Kazakhstan
Palestine
Syria
Iran
Algeria
Vietnam
Libya
Lebanon
Iraq
Saudi Arabia
East Timor
Greenland
Gibraltar
Tajikistan
Turkmenistan
Euromed
Ukraine
Aruba
Anguilla
Non-M.F.N.
Azerbaijan
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Products with the highest export
potentialexported by OIC countries to other OIC
countries (1)
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Products with the highest export
potentialexported by OIC countries to other OIC
countries (2)
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A successful outcome
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Service exports by woman entrepreneurs

• 5 English-speaking countries (Ethiopia, Ghana,
  South Africa, Tanzania, Uganda
• 5 French-speaking countries (Burkina Faso,
  Cameroon, Mali, Senegal, Tunisia, Mozambique
  (mostly OIC members)

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WHAT IS THE SOUTH-SOUTH TRADE PROMOTION
PROGRAMME?
A transaction-oriented programme aimed at
generating new trading opportunities across
developing countries economies in transition
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How South-South Trade benefits developing
countries ?
Production diversification
Consolidates the position of the South
Increase of the market size and Economies of
Scale

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Difficulties in promoting South-South Trade
Exporting Tradition from North to South
Limited capacity of TSIs
Lack of Information

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PROVIDE INFORMATION ON TRADE OPPORTUNITIES
Trade Flow Analyses
Region
Sector
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PROVIDE INFORMATION ON TRADE OPPORTUNITIES
Product Selection Workshop
Validation of Sectors
Design of Workplan
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PROVIDE INFORMATION ON TRADE OPPORTUNITIES
Supply and Demand Surveys
Involvment of TSIs
Description of the Sector and Business Practices

Identification of Key Companies
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Company profile form
CAPTURING COMPANIES TRADING INTERESTS
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TRANSLATE OPPORTUNITIES INTO TRANSACTIONS
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TRANSLATE OPPORTUNITIES INTO TRANSACTIONS

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INCREASE THE CAPACITY OF TSIs AND CREATE
AWARENESS
Involving the TSIs in
The organization of Buyers/Sellers Meetings
Follow-up activities

Exposing SMEs to real-life situations
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Some Examples and Results
REGIONS
Africa and Indian Ocean
Middle East
Asia, Pacific
Latin America and Caribbean
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Products and sectors..
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Innovative applications
Aid procurement
Pharmaceuticals and natural products
Value chain approach
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Results fince 1999
3500 companies from 100 developing countries and
transition economies
50 buyers/sellers meetings
USD 250 millions reported business transactions
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Second Area of cooperation Improving SME
access to finance using Management Competence as
Collateral
Quantifiable/assessable risks
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Reducing Uncertaintiesand Better Assessing
Credit Risks

• Uncertainty mainly deals with lack of
  information about Management Competency
• Competency As Collateral (CAC) quantifies
  management competency allowing a more accurate
  credit risk assessment by reducing uncertainty

CACs assessable credit risk distribution
Usual assessable credit risk distribution
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 Data Modules of CAC
Company Profile
Assessment of Strategy and Business Capabilities
Assessment of Resource Management Capabilities
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ITCs Approach to Trade Finance Example through
the ITC-IDB-AFIs Triangle
Loan for Competenece (Eximbank) Helping
financial institutions evaluating loan
applications from SMEs
ITC tools training
ITC
Competence as Collateral (CAC) SME
certificatioon programme for good management
practice
LOANCOM
SME Finance
SMEs
AFIs or commercial banks
IDB
Credit Lines And Guarantee Lines
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Indeed, diversification means having quality
products.
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Consumer trends.
crochet
ethical fashion
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beadwork ethical fashion
ethical fashion
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Effects of the Paris Declaration...
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Stronger ownership from our clients.
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ITCs Brand Essence
Export Impact For Good
Thank You