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Increasing the Impact of Trade Expansion on Growth: Lessons from Trade Reforms for the Design of Aid for Trade


  • Jean-Jacques Hallaert



In order to reach its objectives, Aid for Trade should not only focus on helping developing countries to turn trade opportunities into trade but also tackle the binding constraints that choke the impact of trade on economic growth. This report shows that although most trade reforms had a positive impact on economic growth, some reforms proved unsustainable and others did not have a meaningful impact on growth. It discusses the various reasons for these outcomes in order to draw the lessons for the design of aid-for-trade projects and programmes and increase their impact on trade performance and on growth. It argues that the scope of activity of aid-for-trade is broad enough to support both the compatible policies that will make a trade reform sustainable and many of the complementary policies that will increase the growth impact of trade expansion. Supporting compatible and complementary policies is about policy coherence and adequate sequencing. As much as possible, proper sequencing and policy coherence should be reflected in the design of aid-for-trade projects and programmes. This cannot be achieved without adequate donor coordination and alignment on country priorities.

Suggested Citation

  • Jean-Jacques Hallaert, 2010. "Increasing the Impact of Trade Expansion on Growth: Lessons from Trade Reforms for the Design of Aid for Trade," OECD Trade Policy Papers 100, OECD Publishing.
  • Handle: RePEc:oec:traaab:100-en

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    References listed on IDEAS

    1. Keiko Ito & Kyoji Fukao, 2005. "The Vertical Division of Labor and Japanese Outward FDI: Impacts on Human Capital Deepening in Japan (in Japanese)," Hi-Stat Discussion Paper Series d05-115, Institute of Economic Research, Hitotsubashi University.
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    Cited by:

    1. Frederick Mayer & William Milberg, 2013. "Aid for Trade in a world of global value chains: chain power, the distribution of rents and implications for the form of aid," Brooks World Poverty Institute Working Paper Series ctg-2013-34, BWPI, The University of Manchester.
    2. Honeck, Dale, 2011. ""Expect the unexpected"? LDC GATS commitments as internationally credible policy indicators? The example of Mali," WTO Staff Working Papers ERSD-2011-07, World Trade Organization (WTO), Economic Research and Statistics Division.
    3. Patricia Sourdin & Richard Pomfret, 2012. "Trade Facilitation," Books, Edward Elgar Publishing, number 14596.

    More about this item


    aid effectiveness; aid for trade; complementary policies; sequencing of reforms; supply-side constraints; trade and growth; trade expansion; trade reform;

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