Magazine article International Trade Forum

Aid for Trade Strategy in the Pacific

Magazine article International Trade Forum

Aid for Trade Strategy in the Pacific

Article excerpt

Just 100,000 people live within the Republic of Kiribati's 3.5 million square kilometre territory in the South Pacific. Kiribati is one of the most remote countries in the world, thousands of kilometres from major ports such as Shanghai, Sydney and Tokyo. Distance, therefore, is a formidable barrier to developing an export trade in manufactured goods.

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But since 2008, the Pacific Islands Forum's regional trade and investment promotion agency, Pacific Islands Trade and Invest, has assisted Kiribati-based KiriCraft Central Pacific in marketing their power catamarans in Australia and New Zealand. The business is providing jobs for citizens of Kiribati, and in just two years, the business has secured more than AUD$ 1.78 million (US$ 1.85 million) in sales from Australia.

KiriCraft owner Michael Savins acknowledges the important role played by Pacific Islands Trade and Invest in developing his business. 'The expert advice, contacts and marketing advice we've received from Pacific Islands Trade and Invest has been crucial in helping us secure our distribution channels in the Australian market.' These services would not have been possible without Aid for Trade funding by key development partners, particularly Australia, China, the European Union, Japan and New Zealand.

Small and remote island states face many challenges when exporting to the world, and the 14 small island nations that are members of the Pacific Islands Forum are among the most challenging business environments in the world. This means companies operating in the Pacific islands must be creative, dynamic and resilient. It also means that well-targeted Aid for Trade has the potential to create long-lasting results that can improve a country's economic performance. KiriCraft sales, for example, are equivalent to over 1% of Kiribati's GDP.

Coordinating Aid for Trade development

The value of development assistance for the private sector has been recognized in the Pacific ACP (Africa, Caribbean, Pacific) for several years. Trade ministers from the region initiated a work programme in 2008 to encourage greater coordination on Aid for Trade with development partners. The programme had three main outcomes: the establishment of a regular Aid for Trade roundtable, which brings together development partners, implementing partners and national representatives to discuss Aid for Trade needs; the development of the Pacific Aid for Trade Strategy, to guide development partners in the provision of Aid for Trade; and the compilation of a list of urgent needs for which funding could be sought from development partners. The first Aid for Trade roundtable meeting was held in 2008, and in 2009 Pacific ACP trade ministers endorsed the Pacific Aid for Trade Strategy.

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The Pacific Aid for Trade Strategy is a policy framework to help Pacific island countries prioritize, undertake and coordinate development initiatives that support increased trade and investment, and which lead to sustainable, broad-based economic development to the benefit of their citizens. The strategy helps ministers focus on the region's most critical trade-related challenges and provides a mechanism for addressing them.

In developing the regional policy, it was important to emphasize national action and, so far, projects supported under the strategy have kept national action firmly in focus. For example, the Oceania Customs Organisation has commenced a major project to modernize customs practices in all 23 member countries, and the Secretariat of the Pacific Community is scaling up a successful programme to promote value-chain development in key agricultural commodities. …

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