Improving Inclusiveness of Trade Policy Making in Developing Countries

1. Improving Inclusiveness of Trade Policy Making in Developing Countries Presentation to CUTS Geneva Resource Centre Session during the WTO Geneva Week 6 May, 2010 By Rashid S. Kaukab Deputy Director and Research Coordinator, CUTS Geneva Resource Centre rsk@cuts.org www.cuts-grc.org

2. Structure of Presentation • Brief Introduction • Trade policy making process: main stakeholders and some features of formal consultative mechanisms • Challenges as viewed by stakeholders • Measuring inclusiveness: the Inclusive Trade Policy Making (ITPM) Index • Conclusions and Recommendations

3. I. Introduction • Importance of trade and trade policy as a means to achieve growth and development • Importance of inclusive trade policy making to ensure relevance and effective implementation • Based on recent CUTS research under the FEATS project with focus on Kenya, Malawi, Tanzania, Uganda and Zambia

4. II. Trade Policy Making: Main Stakeholders

5. II. Trade Policy Making: Main Stakeholders 1. Government Ministry Responsible for Trade Policy • Role of the ministry as the primary institution to deal with all trade policy issues is generally recognized now and reflected in governmental procedures • Responsible for trade policy making, and monitoring its implementation • Also generally responsible for developing negotiating positions for various trade negotiations • Entrusted with the task of consulting all relevant stakeholders on trade policy issues including through the establishment and functioning of consultative mechanisms

6. II. Trade Policy Making: Main Stakeholders 2. Other Relevant Government Ministries and Agencies • Providing overall policy direction to ensure coherence with the long term development vision and strategy, e.g. President’s Office, Ministry for National Planning • Providing specific, expert inputs on issues that are under the mandate of a particular ministry/government agency, e.g., Ministry of Agriculture • Implementing trade policy measures that are covered under the mandate of a particular ministry/government agency, e.g. National Revenue Authority, District Commercial Officers, etc

7. II. Trade Policy Making: Main Stakeholders 3. Private Sector • Organized in overall umbrella organizations (e.g. National Chamber of Commerce and Industry) as well as on sectoral basis (e.g. associations of fresh fruit exporters, textiles and garments industry, etc) • Representation generally through large umbrella and / or sectoral associations but occasionally individual firms also play key role • Informal sector generally not represented

8. II. Trade Policy Making: Main Stakeholders 4. Civil Society Organizations • Organization: international, regional, national; faith-based; project, policy; network • Focus of activities: awareness-raising, advocacy, research, capacity building, project execution, networking • Substantive issue coverage of activities: human rights, trade and development, gender and youth issues, finance and monetary issues • Issues of representation and mandate

9. II. Trade Policy Making: Consultative Mechanisms Categorization by Mandate • On specific trade negotiations (e.g. EPA, WTO) • On all trade issues • On larger set of issues that includes trade Categorization by Membership • Only governmental actors • For public and private sectors • Multi-stakeholder

10. II. Trade Policy Making: Consultative Mechanisms

11. III. Challenges as Viewed by Stakeholders Ministry Responsible for Trade Policy • Lack of capacity and technical human resources • Issues of internal and external coordination • Lack of financial and human resources to ensure regular functioning of consultative mechanisms • Diversity and evolving nature of issues • Changes in governments/restructuring of ministries

12. III. Challenges as Viewed by Stakeholders Other relevant Government Ministries and Agencies • Lack of capacity and technical human resources • Issues of coordination among governmental machinery • Lack of regular and timely information flow on trade issues • Issue of primary mandate

13. III. Challenges as Viewed by Stakeholders Private Sector • Limited technical understanding, and advocacy capacities • Need to balance the interests of members • Tight timelines to provide feedback on trade issues • Need to improve opportunities for less powerful business associations • Representation of informal sector?

14. III. Challenges as Viewed by Stakeholders Civil Society Organisations (CSOs) • Limited technical understanding of complex issues • Need to strengthen research-based advocacy • Need for better coordination and information sharing among CSOs • Occasional tensions with the government • Limited opportunities for participation • Lack of resources to maintain sustained engagement and retain the knowledge and expertise gained on trade issues • Issues of representation and mandate ?

15. IV. Measuring inclusiveness: the Inclusive Trade Policy Making (ITPM) Index Objectives of ITPM Index • Raising awareness about the political economy aspects of trade policy making • Assessing the inclusiveness of a country’s trade policy making processes in terms of the capacities and participation of main stakeholders in these processes • Identifying the weaknesses and gaps that should be the target of related capacity building and other activities by the governments, donors, and various stakeholders • Allowing for comparisons across countries to identify the good practices as well as prompting actions by countries lagging behind • Improving prospects for domestic ownership of trade policies through development and application of more inclusive trade policy making processes

16. IV. Measuring inclusiveness: the Inclusive Trade Policy Making (ITPM) Index Methodology • Development of analytical framework: defining main features of inclusive trade policy; linking these features with elements of trade policy making process and relevant stakeholders; and developing action variables to assess performance • Constructing initial ITPM Indices for all five countries based on the analytical framework and the information collected during the study • Validation of the framework and the initial IPTM Index values and finalization after incorporating the comments

17. IV. Measuring inclusiveness: the Inclusive Trade Policy Making (ITPM) Index IPTM Index: Action Variables, Actors and Values Part I: Ministry Responsible for Trade Policy

18. IV. Measuring inclusiveness: the Inclusive Trade Policy Making (ITPM) Index IPTM Index: Action Variables, Actors and Values Parts II, III, and IV: Other Relevant Government Ministries, Private Sector, and CSOs

19. IV. Measuring inclusiveness: the Inclusive Trade Policy Making (ITPM) Index Explanation of Possible Action Values • Yes = maximum value of 1 = when appropriate action has been taken by the actor concerned • Many/Most = high value of 0.75 = when quite a lot has been done but some gaps remain • Some = intermediate value of 0.5 = when action has been taken but is not sufficient • Few / Little = low value of 0.25 = when some action has been taken but much remains • No = 0 value assigned = when no action has been taken by the actor concerned

20. IV. Measuring inclusiveness: the Inclusive Trade Policy Making (ITPM) Index

21. IV. Measuring inclusiveness: the Inclusive Trade Policy Making (ITPM) Index

22. IV. Measuring inclusiveness: the Inclusive Trade Policy Making (ITPM) Index

23. V. Main Conclusions • Several consultative mechanisms on trade issues established; however • Lack legal mandates and adequate resources • Multiplicity of consultative fora • Not all trade issues covered by consultative fora • Irregular and ad hoc functioning • Improved stakeholders participation; but • Not all stakeholders being represented • Not all stakeholders have equal opportunities to participate

24. V. Main Conclusions • Remaining challenges classified in three broad categories • Related to capacity (limited technical, human, and financial capacities of stakeholders) • Related to institutional and structural issues (design and functioning of consultative mechanisms) • Related to challenges internal to each group of stakeholders

25. V. Some Recommendations • Identification and involvement of all relevant stakeholders: by governments and concerned ministries • Awareness-raising on trade issues: by all actors • Regular information flow on trade issues to key stakeholders: by concerned ministries • Rationalization and strengthening of consultative mechanisms: by governments and concerned ministries • Better coordination among relevant government ministries and agencies on trade issues: by governments

26. V. Some Recommendations • Better opportunities for CSO participation: by concerned ministries • Better feedback and input loops between CSOs and the private sector umbrella organisations on the one hand, and their constituencies on the other: by private sector and CSOs • Investment on knowledge and expertise building: by all including development partners • Promotion of a culture of dialogue and inclusiveness: by all

27. Inclusiveness will generate national ownership which is the best guarantee for effective implementation of trade policy as part of overall development policy