Technical Co-operation, Capacity Building and Doha Work Programme

by Chandrakant Patel*

Geneva, 13 Dec 2001 - Ministers of developing countries, and in particular those from the least developed, African and low-income developing countries, cited the commitments given and prospects of getting technical assistance for capacity building as a major element behind their support to the adoption of the Declaration and Work Programme at the 4th Ministerial Conference of the WTO at Doha, Qatar.

In response to the many commitments made at Doha to help low-income developing countries cope with the enlarged agenda and workload, the secretariat of the World Trade Organization (WTO) has proposed a global extra-budgetary fund of SF.15 million for 2002. Together with contributions from the regular budget, this represents an additional amount of less than SF 5 million over 2001.

If developed countries are serious about implementing the commitments on capacity-building they undertook at Doha, a qualitatively different and more ambitious programme of recipient-driven technical support needs to be established.

The Director General of the WTO as well as several developed country officials, most notably Mr. Pascal Lamy of the EU, have cited the Doha commitments on technical co-operation and capacity building (TCCB) as among its major achievements. The Director General has recently stated, “Provision has been made in every area for capacity building to help developing countries participate and profit from the work.”

A closer examination of these “provisions” in the Ministerial Declaration suggest that they are no more than best endeavour efforts: for example, Para 2 of Doha Declaration states “...sustainably financed technical assistance and capacity-building programmes have a role to play” and accordingly confirms, in Para 38, “that technical co-operation and capacity building are core elements of the development dimensions of the multilateral trading system.”

Promise of technical co-operation in exchange for acquiescence of developing countries to enter into new negotiations and assume further trade and non-trade obligations is by now a well-honed tool of trade diplomacy. Whether it is in the framework of ACP-EU relations or the Final Act of the Uruguay Round or the Singapore Ministerial meeting of the WTO (which launched the integrated framework for trade related technical co-operation to LDCs), the rhetoric of capacity building has rarely been matched by implementation of promises.

The Doha Declaration has set new standards in the not-so-delicate-art of persuading reluctant countries to sign on to far reaching commitments in exchange for vacuous promises of ‘integrated’, ‘comprehensive’, ‘co-ordinated’, ‘enhanced’ etc technical co-operation. The hyperbole could hardly be exaggerated: the Declaration describes the discredited Integrated Framework for LDCs - as “A VIABLE MODEL FOR LDCs TRADE AND DEVELOPMENT.”(Para 43, emphasis added).

In the eleventh hour pressures on developing countries to make concessions, particularly on the new issues in exchange for promises of future technical assistance to them, few developing country Ministers would have raised questions about their experiences with trade-related technical assistance. It is now a moot point whether they would have signed on to the Declaration had they been aware of the size of additional resources now proposed by the WTO secretariat in response to Doha - CRP (01) 31/Rev.2 /December.

To evaluate these proposals, some basic questions about trade-related TCCB need to be raised.

What exactly is the annual size of such support? What has been its quality? Does it add value? How does the quantum relate to needs? Then again, how and where have the resources been spent? Who are the principal beneficiaries of this largesse? Are the resources managed well? Finally, are the Doha commitments additional to on-going TCCB programmes in WTO and elsewhere?

Although detailed information is not available to answer any of these questions with certainty, some conclusions can nevertheless be drawn from available data.  Despite the oft-repeated importance of TCCB, the overall amount not all of it strictly trade-related—provided by the International Trade Centre (ITC), the UN Conference on Trade and Development (UNCTAD) and the WTO in 2000 amounted to around US Dollars 42-43 million, of which WTO’s share was about USD 7 million.

To put this total amount in perspective, the annual budget for technical assistance of the International Atomic Energy Agency (IAEA) alone this year was of the order of USD 65 million. It is also the case that TCCB provided by the Geneva-based agencies over the past several years has not increased in real terms.

As regards the distribution of expenditures, the WTO and its budget documents, and proposals, are not easily available to outsiders. However, an UNCTAD report on its activities for the year 2000 (TD/B/48/5/Add.2/Corr.1, 12 September, Table V) shows that of a total technical co-operation budget of USD 24.18 million in 2000, over 80% was spent on administrative overheads, project personnel and equipment, much of it at headquarters. There is no reason to believe that the situation is any different in other Geneva-based agencies.

Extra-budgetary resources are keenly sought by multilateral agencies since they provide much needed flexibility in their spending programmes, particularly for travel (including by the executives and senior staff to promote their particular agendas), recruitments of short-term staff and consultants, almost invariably from Europe and North America. This flexibility, however, is rarely used for capacity building activities. These features of the current TCCB activities largely explain the malaise and absence of credibility surrounding the provision of such support.

It has been argued that high shares of expenditures concentrated on consultants, experts and administrative overheads at headquarters are unavoidable for TCCB activities since they cover transfer of knowledge, information and skills. Even accepting the argument that TCCB activities are perforce headquarters-oriented and staff- intensive, it does not answer the question regarding its quality and whether it has any value-added to the recipients.

Objective evaluation of technical co-operation activities is difficult for many reasons, including the fact that the donors and agencies conveniently measure TCCB output and its delivery by amounts spent rather than by the quality of services delivered. UNCTAD has acknowledged this difficulty: “The very nature of trade-related technical assistance activities, the inability to devise any common methodology for measuring the gains deriving from them, and the scarcity of data render any quantification of benefits of such activities necessarily precarious.” (TD/ B/48/5 Para 64).

This conclusion is supported by many other studies including a recent General Assembly initiated report which, on the basis of country case-studies, concludes “it is not possible to make an overall assessment of the effectiveness of the impact of operational activities.” (Capacity Building Supported by the UN: Evaluation and Some Lessons, New York).

The management and effectiveness in the use of technical co-operation resources has been a source of concern to all the stakeholders. Experience with one of the major experiments in the provision of such assistance as a result of a decision at the WTO Ministerial meeting in Singapore in 1997 is instructive. That meeting promoted the so-called Integrated Framework for technical cooperation to help least developed countries integrate in the trading system. Since its adoption in 1997, several evaluations, meetings of agency heads and inter-governmental resolutions and inter-agency task forces have failed to breath any life into this much-touted programme of inter-agency co-operation.

The reasons for this are not hard to find: agencies with varying mandates and commitments by their management, differing levels of resources and priorities and even capacities and competencies have been unable to forge a common purpose, notwithstanding the apparently high level of political support for the programme. The same fate is reported to have befallen JITAP (Joint Inter-agency Technical Assistance Programme), yet another “ ...integrated response of ITC, UNCTAD and WTO, to assist in the effective integration of beneficiary African countries into the international trading system” (Para 46,UNCTAD-above).

Judging by these experiences, efforts currently underway in the WTO to revive an integrated response to Doha (WTO Press Release, 23 November) is also likely to yield similar results. In the light of WTO’s limited capacity to provide assistance, it appears to have decided to share the burden of Doha commitments by involving other agencies, including the World Bank and the IMF. Given their ideology and general lack of credibility in developing countries, it is doubtful whether the Bretton Woods bodies in particular can add any value to strengthen developing countries capacities in multilateral trade negotiations.

One of the assumptions concerning the provision of TCCB has been that issues on WTO agenda are perforce technical and therefore warrant technical support and responses. This is indeed the case in many areas of trade negotiations. But trade negotiations are also about power relations and as such go beyond the narrow bounds of economic and trade related expertise provided by typical assistance programmes. The process of transforming the WTO from a trade body to one that embraces virtually the totality of economic relations between states poses challenges that go well beyond technical issues and certainly beyond the capacity of the international agencies to address.

This is nowhere truer than with respect to the relentless drive to promote a framework for Foreign Direct Investment (FDI). The prevailing ideology in international organisations is to promote FDI, on the basis of a priori beliefs about its many advantages for recipient countries. The question of benefits from FDI, however, is an empirical one: the benefits critically depend on the terms of its entry, its effects on employment, balance of payments, on domestic industry and a host of other macro and micro-economic variables. The pre-conceived assumptions surrounding such flows means that none of the major providers of multilateral technical support in this field have the objectivity to provide useful advice. The same is true with respect to other new issues on the WTO agenda such as competition policy and government procurement and for which similar limitations circumscribe their role in providing advice.

In the light of the experiences with these programmes, serious doubts must remain whether the kind of independent and objective support required by developing countries can be mobilised by the present suppliers of such assistance.

It has been estimated that the post-Doha work programme at the WTO may have increased by as much as 50 percent. Much of this derives from priorities accorded to some of the on-going work, more focussed work programme in the four Singapore issues and on trade and environment, industrial tariffs, and implementation issues. Additional work is also envisaged in the areas of electronic commerce, small economies, trade, debt and finance and trade and transfer of technology. In meeting the enlarged workload, the Doha Declaration cites “firm commitments” of TCCB in paragraphs 16, 22, 25-27, 33, 38-40, 42 and 43.The Declaration has instructed the Director-General “to report to the Fifth Session of the Ministerial Conference, with an interim report to the General Council in December 2002 on the implementation and adequacy of these commitments in the identified paragraphs”.

The WTO’s response has been to propose a target budget of SF 15.0 million for the year 2002 - documents CRP (01) 31/Rev.2 and WT/BFA/W/65, 7 December. The extra-budgetary amount is expected to be mobilised through a new global fund, which is expected to bring under one window virtually all of WTO’s TCCB activities. This represents an increase of SF 4.0 million or approximately 36% over the estimated TCCB expenditures in 2001. In assessing additionality, account should be taken of the total incremental contribution from regular and extra-budgetary resources. Some of the activities relating to training were programmed prior to Doha in the 2002 budget proposals and cannot be considered to be additional response to the decisions at Doha.

More important from the standpoint of the developing countries however is the adequacy of the additional amounts proposed. Assessed against their expanded needs and the qualitatively different nature of the support required for the new work programme, the amount falls far short of the expectations engendered by the promises in Doha.

It is equally clear that the willingness of donors to provide support is directly linked to the promotion of their agenda, in which the agencies have heretofore been willing accomplices. In as much as far- reaching policy decisions will be taken over a pre-determined time frame i.e. negotiations to be “concluded not later than 1 January 2005” (Para 45, Doha), will developing countries in Geneva and their capitals, be ready to participate meaningfully in the work programme? More specifically, will they be in a position to agree to launch negotiations on the four new issues by the Fifth Ministerial meeting in two years time? The Doha Declaration assumes that this is a possible, thanks to more TCCB. It is implicitly assumed that the programme of TCCB will somehow level the playing field, equip each developing country with the knowledge and understanding of the new issues and to take key decisions in an informed way.

The current programmes, however, are largely donor and international agency driven and designed to support the status quo. As such, they are more concerned with securing compliance with the system than helping provide advice and support that is independent and objective.

If the developed countries were genuine about their intentions concerning TCCB, they would draw lessons from the unsatisfactory functioning of the existing programmes and help evolve more user-friendly and user-driven programme. Such a programme would have at least some of the following features:

As a general principle, the putative beneficiaries should have the greatest say in the programming of the resources. In the WTO this is done by a combination of the Committees on Trade and Development and on Budget, Finance and Administration. In practice, however, it is the secretariat that drives much of this process. If developing countries are to help design a user-friendly and driven programme, it may be necessary for them to evolve a consultative mechanism of TCCB users with a view to provide guidance to the secretariat, make recommendations concerning prospective needs, monitor agencies activities and make periodic evaluation of the on-going programmes.

In at least three areas identified below, developing countries are in a position to make recommendations that are consistent with the Doha commitments. First, a greater share of training and capacity building expenditures should be required to be undertaken at the national level involving national ministries and departments heretofore absent from the work of WTO. This is particularly the case in several new areas where many more government ministries, departments and private sector entities are likely to be involved in the negotiations. Secondly, the capacity of Geneva- based missions of low-income countries should be strengthened by the addition of at least two professional staff to be funded by the programme. With the number of meetings scheduled certain to grow rapidly, the difficulties developing countries, particularly LDCs and several other low-income countries, will face in servicing them will mount.

It is equally clear that technical assistance of the type dispensed so far will make little difference to their capacities to negotiate effectively and safeguard their national interests. Often developing countries have been accused of adopting a negative stance in their negotiations i.e. that they tend to be reactive to the proposals rather than be pro-active. The reason for their back-to-the wall-approach in trade negotiations lies in the fact that many of them do not have the resources, technical support and back up to prepare their positions and react in an informed way, let alone take a pro-active stance to a proliferating agenda that they have failed to contain.

Third, increased and regular participation by officials from capitals, in meetings and on-going negotiations should be a regular feature of the TCCB programme. In the area of investment and competition policy for example, issues of a regulatory nature of concern to public utilities, will require participation in on-going negotiations by officials from bodies such as power, water, transport and communications, to name a few.

Such participation would become an important tool of capacity building; it would also strengthen Geneva missions with expert level participation from capitals.

The cost of programmes such, as the ones outlined above are likely to go well beyond those currently under discussion. For such a programme to materialise, however, developing countries will have to play an active role in the budgetary processes of WTO in order to ensure that Doha and other commitments are implemented. This may warrant greater scrutiny of budget proposals, significant shifts in spending priorities and re-allocations within both the regular and non-regular budgets of the WTO and other agencies. – SUNS5031

[* The author was a senior official at UNCTAD and has had experience of LDC programmes and technical assistance activities. He represented SEATINI, the Southern and Eastern African Trade Information and Negotiations Initiative, at Doha and contributed this article at the request of SUNS.] .

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