Have TPOs Changed? National Institutions Are Essential to Increase Trade in a Sustainable Way. the Best Trade Promotion Organizations Continue to Evolve in a Fast-Changing Trade Environment. This Is the Message in the First of Three Viewpoints about TPOs

Article excerpt

This well-known Chinese proverb is most relevant for any type of sustainable development. Amazingly, it is often ignored by technical assistance providers who, in their haste to do good and be seen to be doing good, often support the "quick fix" or the "quick win". Many proceed on the basis that if the man is hungry, give him some fish. This allows the technical assistance provider to show immediate positive results and everyone is happy over the short term. The problem is that the man comes back tomorrow, hungry again, but by then the donor may have moved resources on to another "quick win" situation.

Sustaining trade development

Government-funded (not necessarily government-controlled) national development institutions are indispensable to sustainable development. Though painstaking to establish, these institutions provide continuity after technical assistance projects end.

This is as true for LDCs (least developed countries), such as Cambodia and Lao People's Democratic Republic, as it is for developed countries, such as Ireland, which has benefited from substantial European Union (EU) development assistance for over 20 years. The alternative is cosmetic interventions with little real hope of sustainability once the technical assistance project comes to an end.

Most writers on trade development, of which there are regrettably not many, start from some World Bank-sponsored articles written in the early 1990s and usually agree that trade promotion organizations (TPOs) in developing countries have not been very successful. Developing countries' TPOs were generally considered an inappropriate delivery mechanism for trade support: they were a single (or monopoly) public service supplier, with unsuitable and poorly paid staff, hamstrung by inflexible government procedures, wrong attitudes and strategies; they had a confusion of purpose resulting from the assumption of regulatory and administrative roles; and they had failed to develop the range of necessary commercial support services.

Taking another look at TPOs

This issue of Forum, which features the very successful 5th World Conference of TPOs, held in Malta in October 2004, provides us with an opportunity to take another look at TPOs around the world and ask ourselves a few questions: Have TPOs moved forward since 1991, and are they more or less relevant today? Do we have better options to deliver trade support services? Are these the right questions?

Yes, they have moved forward, some TPOs more than others. Unfortunately, some TPOs in the less developed countries still lag far behind. This does not mean that they are not needed.

No "one-size fits all"

The trade environment has changed radically since the early 1990s, and has become a more fast-paced and complex world for exporters, potential exporters and national policymakers. Institutional structures to deliver trade support services are more, not less, necessary.

These changes in the trade environment make it incumbent on TPOs to monitor and review their position constantly and also remind us that there is no "one-size fits all". The delivery of technical assistance is complicated, because no magic formula exists that will work in all countries all of the time.

What structures are appropriate? A developing country, cannot rely on foreign technical support--however good--indefinitely. At an early stage, it must start to develop its own expertise, best nurtured within focused, institutional structures.

There are many institutions needed for trade development: from those related to basic infrastructure, such as customs, transport, air and sea ports, to those that facilitate market access and support competitiveness, such as standards bureaux or packaging institutions. TPOs are just one of these necessary structures, although arguably the ones with the most comprehensive base for trade.

As mainstream development agencies, the institutions cannot be for profit. …