Index

Capacity Building

Christophe Bellmann

“There is also a need to provide developing countries with assistance to identify possible policy options to implement their rights and obligations under international treaties and to strengthen the reform of domestic institutions and regulatory frameworks.”

The pursuit of economic growth without taking into account the broader public policy agenda on human development (e.g., education, health and nutrition); equity (e.g., livelihood security, income distribution and gender equality) and the environment is unlikely to result in lasting poverty reduction. As a response to these concerns, the last decade has seen increasing recognition by the donor community of the need to assist developing countries in integrating environment, development and trade concerns into policymaking and in maximizing net sustainable development gains from trade.

At the fourth WTO Ministerial Conference in Doha, promises of new technical assistance commitments, together with numerous references to capacity building in as many as 12 paragraphs of the Doha Ministerial Declaration, played a critical role in securing developing countries’ acceptance to initiate a broad-based round of negotiations. The launch of negotiations on fisheries and environmental goods and services also generated momentum for trade and environment capacity building as reflected in Paragraph 33 of the Doha Declaration, which highlights the importance of technical assistance in this area. Since Doha, many developing countries consider technical assistance and capacity building (TACB) to be a key element of a “development” round.

Interests and Fault Lines

TACB concerns are not exactly a “negotiating item,” but it is clear that recipient and donor countries are motivated somewhat differently. Even though all countries share the broader goal of capacity enhancement in developing countries, and while Doha commitments are resulting in increased financial and organizational resources, there are serious concerns that the type of assistance provided so far has not adequately responded to the specific needs of developing countries and failed to yield the desired outcome.

Developing country interests in trade, environment and development TACB relate to policy formulation; participation in international rule making and standard setting; domestic regulatory reforms and implementation of international commitments; and compliance with environmental and food safety standards. In this section, we will first look at each of these developing country interests and then review the issues from the perspective of the providers of technical assistance and capacity building.

Enhancing Domestic Policy-making

For most countries, a major policy challenge consists of integrating environment, development and trade objectives into a mutually supportive policy framework that maximizes the net sustainable development gains from trade. Building on earlier work by Solignac Lecomte, the accompanying figure provides a schematic description of the various stages of an ideal stylized policy process. First, the definition of domestic interests needs to be framed in the broader context of the national sustainable development strategy and developed through a participatory process involving both state and non-state actors. The interests identified through this process then form the basis of the country’s negotiating positions, the orientations and content of domestic regulatory reforms, and the trade promotion strategy. Finally, roles are attributed and resources are allocated to pursue those policy objectives.

It is inappropriate for technical assistance providers to intervene in the definition of national interests and the assessment of different policy options, not least because their own interest might conflict with recipient priorities. However, donors may want to support an integrated policy-making process by strengthening domestic analytical capacities and facilitating policy dialogues with relevant stakeholders. This can be accomplished in three main ways: Through building domestic analytical capacities, promoting participation, and facilitating the policy-making process.

Building domestic analytical capacities. A solid understanding of the costs and benefits of trade liberalization from a sustainable development perspective is a sine qua non condition for informed decision-making. However, with very few exceptions, developing countries lack the analytical capacities to conduct applied research at home, undertake informed cost-benefit-risk analysis and to anticipate the necessary social and environmental adjustments associated with trade liberalization. Most of the analysis produced in this field is generated in the North. Building backstopping analytical capacity in developing countries requires strengthening centres of excellence (universities, think tanks) that look at trade in the broader context of sustainable development and can provide informed inputs into the policy-making process, but that are independent institutions. The creation of specific academic curricula in developing country universities would also contribute to filling this important gap.

For a higher resolution version of this figure, click here.

Promoting participation. International trade rules affect a broad range of stakeholders concerned with multiple agendas, such as fish stocks management, water sanitation, biodiversity conservation, soil erosion and pesticide use. While governments should maintain their role as decision-makers and arbitrators between different national interests, inclusiveness and participation in policy-making are fundamental for assuring legitimacy, good governance and acceptable results for the society at large. It is also essential to ensure integrated policy-making that goes beyond short-term mercantilist interests and reflects broader public policy concerns. Traditionally, the conception of stakeholders or constituencies in the trade and environment field has been narrow, limited mostly to ministries of trade and ministries of environment. This conception needs to be broadened to include the variety of actors who are actively involved in sustainable development policy-making.

Facilitating the policy-making process. The active participation of relevant and wellinformed stakeholders is not sufficient in itself. It is equally important to put in place formal (inter-ministerial committees and public-private dialogue platforms) and informal (lobbying) mechanisms through which interaction can take place. In most countries, very little has been done so far on the integration of environment, development and trade; there are concerns that the few embryonic mechanisms that have been put in place often remain “empty shells” due to a lack of political leadership or a low level of understanding of the issues. Donors could play a role in supporting the establishment of permanent advisory committees for trade, environment and development, which could become the focal point for inter-agency coordination and the integration of sustainable development concerns into policy-making.

For a higher resolution version of this figure, click here.

Participation in International Rule Making and Standard Setting

There is a need to assist developing countries in advancing their sustainable development interests in international negotiations. This can come in the shape of strategic advice, formulation of negotiating proposals, coalition building, public awareness campaigns and financial support for participation in negotiations. For example, developing countries need to design offensive and defensive strategies not only on the various negotiating items but also on the implications of other related areas of the negotiations. The fact that Western and Southern African countries, for example, have been virtually absent from the negotiations on fisheries subsidies, even though many of them have major trade and natural resource management interests, is symptomatic of the need for TACB in this area.

Beyond the WTO, developing countries are simultaneously negotiating at multiple levels, ranging from multilateral negotiations under various multilateral environmental agreements (MEAs) to bilateral and regional free trade agreements. Another major area of concern relates to the ability of countries to participate in international standard setting bodies, such as the Codex Alimentarius Commission. Developing country participation is crucial as standards developed by those institutions form the basis of international harmonization, which is encouraged under the WTO Agreement on the Application of Sanitary and Phytosanitary Measures (SPS). The risk for many countries is to end up with standards set at levels inappropriate to their situation or which require infrastructure that is unavailable domestically.

Regulatory Reforms and Implementation of International Commitments

There is also a need to provide developing countries with assistance to identify possible policy options to implement their rights and obligations under international treaties and to strengthen the reform of domestic institutions and regulatory frameworks.

Translating WTO or MEA commitments into domestic law can be costly and burdensome. The implementation of the SPS Agreement, for example, involves building new public agencies, educating personnel, establishing notification and enquiry points, upgrading national standards to world-class levels and creating domestic capacities to undertake risk assessment. Beyond the cost of implementation, many developing countries face difficulties in implementing their obligations under different international instruments in an integrated and coherent manner. The absence of international mechanisms to ensure policy coherence among the different regimes not only generates legal insecurity, it also places the burden on individual governments to reconcile any inconsistencies. While the WTO agreements and MEAs are mutually supportive in principle, experience has shown that conflicts between regimes might arise at the implementation stages. This was the case, for example, in the highly controversial debate on the compatibility between the WTO Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS) and the Convention on Biological Diversity (CBD). While this challenge applies equally to developed and developing countries, the latter are often not sufficiently equipped to resolve potential conflicts.

Compliance with Environmental Requirements in Export Markets

A growing number of products from developing countries are subject to environmental and health measures in Northern markets. These measures involve economic instruments, technical regulations and standards, and quantity import controls. Knowledge of existing standards is limited in developing countries and the cost of compliance can be high, particularly if new requirements are regularly introduced. For example, the SPS regulations in the European Union that establish “farm to fork” tracing requirements, maximum residue levels of pesticides or hygiene regulations have a significant effect on the ability of developing and particularly least-developed countries to export products such as fruits, vegetable or fish. Access to, and local adaptation of, environmentally sound technology (EST) plays an important role to help countries upgrade their production processes and meet growing consumer preferences for green products in the North.

On the other hand, voluntary instruments such as eco-labels or geographical indications have the potential to help developing countries enhance their market penetration and facilitate the creation of specific niches for environmentally preferable products (EPPs). The production and promotion of EPPs or products based on traditional knowledge, which are often produced by poor rural communities, can also contribute to poverty reduction. Taking advantage of these opportunities, however, often involves high investment, well-adapted marketing tools and knowledge of potential export markets. In practice, few countries have the capacity to promote such forms of sustainable trade without long term and well-targeted TACB.

Providers of Technical Assistance and Capacity Building

The supply of TACB encompasses a wide variety of services provided by a myriad of international, bilateral and non-governmental donors. It mostly takes the form of training packages and seminars for government officials, manuals and handbooks, policy research and dialogues. Providing an accurate overview of trade and sustainable development TACB, however, is complex; not least because of the lack of reliable data and the large number of small-scale, one-time workshops or conferences. Another difficulty relates to the crosscutting nature of the trade, environment and development debate. Many technical assistance services related to agriculture, intellectual property rights and market access often address environmental concerns even if this is not their primary objective.

The most elaborated source of information on TACB is the joint WTO-OECD Doha Development Agenda Trade Capacity Building Database (see http://tcbdb.wto.org), which compiles data reported from bilateral donors and regional and multilateral agencies. According to this source, donor commitments on trade and environment amounted to US$84.2 million in 2001. This figure decreased to US$25.4 million in 2003 even though the number of activities increased from 64 to 70. It should be noted, however, that this database only provides a partial and probably underestimated overview. Reports by donors including major ones are often incomplete. It is clear, however, that trade and environment related TACB remains a marginal area of capacity building. In 2002, for example, it only represented four per cent of the WTO’s assistance, with only 21 of a total of 488 courses and seminars focusing on trade and environment issues. In subsequent years, this percentage decreased to less than 1.8 per cent, with eight activities out of 451 in 2003 and nine out of 501 in 2004.

The main providers of trade and environment TACB can be divided into three broad categories.

• International and regional organizations assist government officials to adjust to international rules and disciplines, implement obligations, comply with environmental requirements, participate in international negotiations and exercise their membership rights.

• Bilateral governmental donors vary considerably in the scale and geographical coverage of their TACB. The main providers include the European Union and its members, the United States, Japan and Canada. They address a wide range of needs by providing assistance either multilaterally by contributing to international agencies or bilaterally through national development cooperation and environment ministries. They also contribute to projects undertaken by non-traditional providers, such as non-governmental organizations (NGOs).

• Non-traditional providers have become important TACB providers over the last decade. They include environment and development NGOs, consumer groups, activists, think tanks and universities. Most rely on funding from bilateral donors and private foundations. Their activities focus on policy analysis, policy dialogue, support to negotiations and advise on implementation of international commitments. As opposed to multilateral agencies, they tend to deal with a broader set of stakeholders, including government officials, the private sector and grassroots organizations. They also fill important gaps in areas where traditional donors are less active such as policy dialogues.

Trends and Future Directions

Ensuring that the limited resources allocated to TACB effectively respond to the expectations of developing countries requires a comprehensive review of existing policies and practices by donors as well as recipients. This section identifies a few strategic considerations that should be explored further and are likely to be critical in shaping the future of TACB discussions.

A Sustainable Development Approach

Despite recent efforts to promote a holistic approach, most TACB activities remain compartmentalized and have failed to move from isolated to integrated policy-making. In particular, a sustainable development approach that goes beyond short-term mercantilist interests and effectively encompasses environmental, human development and equity concerns still evades the design and delivery of trade-related capacity building activities. A significant extent of trade and environment related TACB services, for example, focuses narrowly on the agenda of the WTO Committee on Trade and Environment (CTE) with little attention given to other dimensions of the trade, environment and development interface.

A Beneficiary-driven Approach

Overall, technical assistance services remain essentially conceived by the providers with a low degree of diversification and responsiveness to the particular needs of the beneficiaries. Seminars and training packages are largely standardized with little attention being paid to the country’s level of development or cultural differences. Neither is assistance tailored to regional needs, environmental concerns and economic interests of the country in question. For example, most technical assistance focuses on multilateral negotiations with few initiatives for bilateral and regional negotiations. TACB also tends to be centered on export needs, without ensuring that local consumers benefit. Technical assistance for compliance with SPS standards, for example, often results in better quality and safety standards, but only for exported goods and rarely for the local market.

Building Local Capabilities

Frequently, TACB is designed as a transfer of knowledge and solutions from the North to the South. Trade experts come to lecture or train developing country officials. Local skills and capabilities to find solutions are not created within local institutions. Donors should also be aware of the risks associated with placing excessive emphasis on individual capacity building over institutional development. Experience has shown that technical assistance programs targeted at individuals all too often result in those individuals leaving the civil service for more lucrative positions in the private sector or in international organizations once they have accumulated expertise. In contrast, few resources are invested in strengthening centers of excellence in developing countries, which can provide lasting analytical capacities to inform the policy-making process.

Targeting the Right Participants

Despite a wide recognition of the need to promote policy dialogue, a large majority of activities remain focused on training and teaching policy-makers instead of promoting long-term interaction among stakeholders. Among policy-makers, beneficiaries are often mid-level government officials who have little influence in their ministries and who may not be in a position to share or put in practice what they have learned. TACB providers should consider selecting participants more carefully to ensure that they reach out to key people within different stakeholder groups.

For a higher resolution version of this figure, click here.

Establishing Long-term Relationships

Technical assistance services, all too often, take the form of one-off conferences or workshops with little or no efforts to build longterm relationship. Activities are isolated, unlinked to others and lacking follow-up, evaluation and ex post assessment to adjust future activities to country needs. They also continue to be delivered in an uncoordinated and ad hoc manner by different institutions.

Promoting Diversification of TACB Supply

Finally, most of the financial resources are concentrated in a limited number of providers. While donor coordination and synergy are essential, particularly if TACB is to promote integrated policy-making, there is a case for a more diversified supply of technical assistance to allow beneficiaries to choose among different providers. Of course, this presupposes the beneficiaries’ ability to make appropriate choices and highlights the importance of effective policy formulation in developing countries. Such “competition” might help to improve the quality of technical assistance and ensure that the services provided effectively respond to the beneficiaries’ specific needs.