Aid for Trade projects should address next generation issues in Bangladesh

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CPD Research Director Fahmida Khatun addresses the dialogue.

Although the Aid for Trade (AfT) was designed to support trade-related capacity building towards strengthening global integration of the LDCs, the impact of AfT in Bangladesh has been rather mixed.

A CPD study revealed that the flow of AfT has been declining in the key areas of infrastructure development and capacity building in the country.

These observations emerged from the CPD dialogue on “Aid for Trade: Second Generation Issues for Bangladesh,” co-organised with International Centre for Trade and Sustainable Development (ICTSD), Geneva, at the BRAC Centre Inn Auditorium in Dhaka, on 24 October 2013.

Speakers at the dialogue identified a number of second generation issues such as the importance of strategic trade policy, role of FDI, formulation of regional projects under AfT, donor coordination and role of AfT in global value chain.

Dr Fahmida Khatun, Research Director, CPD, made the keynote presentation titled “Effectiveness and Impact of Aid for Trade Initiative in Bangladesh,” which was part of an eight-country study that undertook an examination of AfT by following a common methodology developed by the Nepalese think tank South Asia Watch on Trade, Economics and Environment (SAWTEE), Kathmandu.

Dr Khatun noted that despite an increasing volume of support under AfT since 2002 at the global level, Bangladesh has experience a slow progress. Moreover, the effectiveness of AfT in terms of alignment, coherence and impact on some key areas was rather discouraging in the context of Bangladesh.

Among many recommendations, Dr Khatun stressed the establishment of an AfT Cell similar to the Aid Effectiveness Unit at Economic Relations Division (ERD), and mainstreaming of trade policies in national development policies.

Discussants pointed out that private sector in Bangladesh should be more involved in identifying projects under AfT; institutions dealing with trade policies should be strengthened and there should be domestic ownership of the trade agenda.

Mr Christophe Bellmann, Programme Director, ICTSD made introductory comments at the session, chaired by Professor Mustafizur Rahman, Executive Director, CPD.

Dr Md Mozibur Rahman, Chief Executive Officer, Bangladesh Foreign Trade Institute (BFTI) and Ambassador Dr Toufiq Ali, Former Permanent Representative of Bangladesh to the WTO and UN Agencies in Geneva, were present at the event as the Chief Guest and the Guest of Honour respectively.

The event was also addressed by Distinguished Panellists Dr Sanjay Kathuria, Lead Economist, Regional Integration, South Asia Region, The World Bank, Washington D.C.; Dr Mostafa Abid Khan, Director, Programme, Research and Policy Advocacy, BFTI and Mr Fazlul Haque, Former President, Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).

Dr Debapriya Bhattacharya, Distinguished Fellow, CPD shared his views on a wide range of relevant issues as the Special Commentator.

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Effectiveness and Impact of Aid for Trade Initiative in Bangladesh

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