Australia's aid for trade investments

Trade facilitation and integration

Facilitating trade—WTO Agreement on Trade Facilitation

In recognition of the significant potential benefits of reducing red tape barriers to international trade, WTO Members concluded the Agreement on Trade Facilitation (TFA) at the Ninth Ministerial Conference on 7 December 2013 in Bali.  The TFA was negotiated with the needs of developing countries in mind. It has a phased implementation process and provisions for donor countries to support developing countries meet the commitments. Australia is partnering with the World Bank to help developing countries undertake reforms in line with the TFA, to cut red tape by simplifying and modernising trade processes. More than 60 countries have already requested support, with positive results. For example, in Timor Leste we have helped to reduce processing times at Dili Port from 16 to nine days, which contributes to Timor Leste’s economic development by lowering the cost of trading, boosting links to global markets, and increasing investment attractiveness. Australia has also provided support to the WTO Trade Facilitation Agreement Facility to assist developing and least developed countries to implement the Agreement.

Mainstreaming trade in national development strategies—Enhanced Integrated Framework

Australia is one of 23 donors to the Enhanced Integrated Framework (EIF). The EIF helps least developed countries build their capacity to trade, including by identifying and addressing major constraints to trade, formulating and implementing trade policies and strategies, and mainstreaming trade into their national development plans. The Sustainable Development Goals recognise the EIF as being one of the main multilateral mechanisms for donors to assist developing countries with aid for trade.

Infrastructure and finance

Enhancing access to trade finance—working with the Asian Development Bank

International trade is a driving force behind economic growth. Since 1990, it has lifted more than a billion people out of poverty in our region. For small and medium businesses in developing countries, having access to trade finance is crucial to participating in the global trading system. The ADB estimates there is about a $1 trillion trade finance gap in the Asia-Pacific region.

Through the ADB’s Trade Finance Program, Australia is: supporting stronger prudential and governance processes for banks in the region; helping banks to develop new products that can be accessed by their customers to finance their trade transactions; and providing guarantees and co-insurance to support transactions. The outcome is improved access to trade finance in developing countries, especially for small businesses. In 2017–18, Australia’s support helped catalyse more than 3500 trade finance transactions worth $4.5 billion in developing countries in our region. This involved more than 240 banks and benefited more than 2800 small and medium enterprises. With Australia’s support, this work is also expanding into the Pacific region for the first time. Following a rigorous due diligence process and training, banks in Fiji, PNG, Samoa and Vanuatu are now being supported to deliver loans and guarantees to prospective traders. The first transaction supported was for $30,000 in pre-export finance to ship 8 tonnes of cocoa beans from Samoa to Japan.

Banking opportunities for the poor—South Pacific

As the Pacific is one of the least banked regions in the world, Australia is supporting the Pacific Financial Inclusion Program. The Program helps develop the capacity of financial service providers and regulatory bodies in the Pacific to deliver new products and invest in technology-linked delivery channels. The program has helped more than two million low-income Pacific islanders gain access to formal financial services and financial education.

Women’s economic empowerment

Promoting gender equality through better factory conditions

Across Asia, approximately 80 per cent of garment and footwear factory workers are women. Women who work in these sectors often do not earn enough for a decent standard of living or to meet their own and their families’ basic needs. Women are also often frequently subjected to sexual harassment in the workplace and have little or no access to labour rights.

To support the improvement of labour standards in the garment and footwear factories, Australia is partnering with the International Labour Organization and the International Finance Corporation, through their Better Work program, to improve workplace standards, including wages, working hours, maternity leave and labour relations. The program is operating in 1600 factories that together employ more than 2 million workers in seven countries. Australia’s funding for Better Work goes to projects in Bangladesh, Cambodia, Indonesia and Vietnam. In addition to improving working conditions, the program has led to a 22 per cent increase in productivity, and a 25 per cent increase in profitability, for participating factories.

Agriculture

Australia Indonesia Partnership for Rural Economic Development

This program aims to increase inclusive economic growth in five provinces in eastern Indonesia by influencing how agricultural markets work for the poor. The program is designed to help reduce the number of Indonesians living in poverty, address constraints to rural income growth and improve agricultural productivity. The program is facilitating private sector-led investment in better agricultural practices, while also supporting the Australian Government's aid for trade and women's economic empowerment priorities.

Health and disability

Addressing non-communicable diseases

Aid for trade can contribute to achieving health objectives.  Australia, through the McCabe Centre for Law and Cancer, is helping to train government health and legal professionals from developing countries to better understand the impact of international trade laws on the implementation of domestic regulations necessary to address non-communicable diseases (NCDs). The training program is helping developing countries implement commitments under the 2011 United Nations Political Declaration on the Prevention and Control of NCDs, World Health Organization’s Global action plan for the prevention and control of NCDs 2013–2020, and the World Health Organization’s Framework Convention on Tobacco Control.

Bringing books to the disadvantaged—Bangladesh

Australia and the World Intellectual Property Organization (WIPO) are working together to navigate global copyright rules to help developing countries access education material for use by the visually impaired. Our partnership has led to the production of accessible books and reading devices that have benefited more than 35,000 visually impaired people in Bangladesh, Nepal and Sri Lanka.



Last Updated: 8 October 2018