Published on Let's Talk Development

A New Year’s Resolution: Closing the Gap on Trade Research

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New Year’s resolutions are always of the lofty – but often short-lived kind.  I will go to the gym more often, lose more weight, or volunteer more often than I do now.  One resolution made by a number of  us in the Research Group of the Bank – and elsewhere, has been to find a way to get more people excited about investing in data collection and analysis on trade.  I recognize this is not the most glamorous of topics at any time of the year – but nonetheless a resolution as important as any made each year for decades as the calendar turns another page.

Here is why 2011 is different and resolutions made can be kept, however, and why data and research should be high on anyone’s development and trade agenda.
There were a number of high level dialogues in 2010 and 2011 related to global finance, trade, and development issues.  These included the High Level Summit on the MDG’s in September 2010 and the G20 Summit in Seoul in November 2010.  These events provided important opportunities -- in the post-crisis environment – to inform priorities going forward on aid effectiveness and trade.  The President of the Bank, Mr. Zoellick, outlined in October 2010 -- in a very high profile speech at Georgetown University – a new vision of development economics which included new ways of looking at and advancing research tied to make aid more effective and inclusive.

The UN LDC-IV process in 2011 presents a unique opportunity to build on this momentum gained last year to review priorities in the global aid for trade agenda as they relate to informing aid effectiveness and trade for the poorest of the world’s citizens.  The post-crisis world demands lower trade costs for development as well as more effective and targeted aid solutions informed by research.

The World Bank is committed to attaining a better understanding of the channels through which aid for trade affects the LDCs.  Bank research suggests, for example, that aid targeted at trade policy and regulation reform has an average return on investment that is nearly 20 times greater than returns on infrastructure and trade development investments.  Meanwhile, other research here shows that if investment were focused to improve the infrastructure quality of Chad, for example, halfway to the level of South Africa, trade levels in Chad would increase by 79% (a comparable increase in exports would require a reduction of 58% in import tariffs).

The need to make investments in data and analysis on aid effectiveness and trade can’t be ignored.  We’ve taken good steps in 2010 – let’s not let the momentum slip away into the dust bin of resolutions made and broken.  The World Bank’s Research Department co-organized, with the UN, an official LDC-IV pre-Conference event in Geneva on December 13th.   We discussed concrete actions for the Bank and other institutions to act to: 1) assist the LDCs in increasing trade-related aid effectiveness and, 2) provide innovative research and analytical tools specific to the unique challenges faced by LDCs today in expanding trade opportunities. 

The World Bank delegation at the LDC-IV pre-Conference event was led by Managing Director, Mahmoud Mohieldin, and consisted of  Ishac Diwan, Country Director (AFR) and me.  Other participants included: Pascal Lamy, Director-General of the World Trade Organization; Cheick Sidi Diarra, U.N. Under-Secretary General and High Representative for the LDCs; Patricia Francis, Director, International Trade Centre; Dorothy Tembo, Executive Director, Enhanced Integrated Framework; Paul Collier, Economist; William Egbe, President, Coca Cola South Africa; and several LDC Ambassadors to the UN and WTO.

Mr. Mohieldin issued a challenge to the development community to “come together in support of innovative and concrete research, data, and knowledge tools tailored to the LDCs.” 

Let’s make this a New Year’s resolution for 2011 we can all take credit for keeping when we meet in Istanbul for UN LDC-IV in May.

For more information on the Bank’s LDC-IV pre-Conference event and the proposed research partnership, please visit DECRG’s Trade Costs and Facilitation project web page and the recent story on the World Bank’s main page. 



John Wilson

Former Lead Economist, Development Research Group, World Bank

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