Interview: Africa needs both aid and trade
The International Trade Centre (ITC), a subsidiary of the United Nations Conference on Trade and Development (UNCTAD) and the World Trade Organization (WTO), provides technical assistance on global trade to businesses in developing countries. Arancha González, the ITC's executive director, sat down with Africa Renewal's Nirit Ben-Ari and Kingsley Ighobor to talk about the centre's activities and Africa's growing influence in the global marketplace. These are excerpts from the interview.
Africa Renewal: What does ITC do in Africa?
González: Over half of our activities are in sub-Saharan Africa, where we address the need for skills, access to capital and improved competitiveness. For example, we provide training on how to access finance for trading.
AR: How do you work on the ground?
González: We provide expertise to local partners. There are thousands of companies that could benefit if we build capacity locally. The expertise that we provide for mango producers in Senegal, for example, will also benefit pineapple or poultry producers there.
AR: Where else in Africa are you working?
González: We have a project with spice traders in Zanzibar, Tanzania. We found out that producers can obtain up to 20 times more revenue by branding and packaging the product attractively.
AR: How do you promote trade within Africa?
González: We promote trade by supporting the African Union's goal to make the continent a free trade zone, because we think that part of the difficulties are that local markets are too small. Our key objective is to remove obstacles to trade.
AR: What are the obstacles?
González: The new obstacles are non-tariffs barriers, such as regulatory constraints. Other non-tariff barriers are technical regulations and safety standards.
AR: How do you reduce trade barriers?
González: We survey companies and ask them what the barriers to export and import are. Once we map these barriers, we sit down with the companies on one side, and the government and regulatory agencies on the other and help them identify obstacles to trade and what has to be done to tackle them.
AR: Tell us about your Aid for Trade programme.
González: Aid for Trade is the name we give to development assistance that builds the productive capacity of countries and companies to trade.
AR: What does Africa need more: aid or trade?
González: It would be a simplification to make countries choose between aid and trade. The reality is that both are needed. The question is not whether to choose between aid or trade, but how to balance the two.
AR: Do you believe that trade agreements tend to favour developed economies at the expense of weaker ones?
González: No, because that statement presupposes that African countries are incapable of negotiating profitable trade pacts. And I don't think this is true.
AR: From a position of weakness, Africa countries can't be very assertive at the negotiating table.
González: I have seen African countries negotiate bilaterally and within the WTO. African countries come to the WTO prepared and defend their interests with vigour. They will not sign an agreement until their interests have been taken into account.
AR: Do you expect EU food subsidies to be removed soon?
González: African pressure has led the EU to rethink part of its agricultural subsidies. And now the EU is offering to eliminate export subsidies. That's a victory for Africans who have said, “We will not negotiate an agreement with you because you are dumping food products in Africa.”