WT/COMTD/AFT/W/48  
 
4 April 2014  
(14-2086)  Page: 1/29  
Committee on Trade and Development 
Aid for Trade    
 
TRADE-RELATED DEVELOPMENT OUTCOMES AND IMPACTS:  
AN ANALYSIS OF THE 2013 AID-FOR-TRADE FACT SHEETS 
 
Table of Contents 
 
1   OVERVIEW AND MAIN FINDINGS ................................................................................ 3  
1.1   Key Co nclusi ons ........................................................................................................ 4 
2   FINANCIA L INFLOW S .................................................................................................. 5  
2.1   Least-develope d countries (LDCs) ............................................................................... 10 
3   TRADE PERFORMANCE AN D TRADE INDI CATORS ...................................................... 12  
3.1   Least-develope d countries (LDCs) ............................................................................... 15 
4   DEVELOPMENT INDICATO RS ..................................................................................... 17  
4.1   Least-develope d countries (LDCs) ............................................................................... 18 
5   THE RESULTS CHAIN PERSPECTIV E APPLIED AT THE MACRO LEVEL ......................... 19  
5.1   Development financ e and trade pe rformance ................................................................ 19 
5.1.1   Aid for Trade and trade pe rformance ........................................................................ 20 
5.2   Trade performance and developmen t impacts ............................................................... 22 
6   CONCLUSIONS ........................................................................................................... 23  
7   REFERE NCES ............................................................................................................. 25  
ANNEX I - 80 DEVELOPING COUNTRIES USED FOR THE ANALYSIS ACCORDING TO 
INCOME GROUPS  .............................................................................................................. 26  
ANNEX II – CHOICE OF INDICATORS  ................................................................................. 28  
 
 WT/COMTD/AFT/W/48 
 
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Table of Figures 
 
Figure 1 - Results Chain Framework to Conceptualize Trade and Development - Performance in Developing Countries ................................................................................... 3
 
Figure 2 - Aggregate financial inflow s 2005-2010 (current US$ millio ns) ................................... 5  
Figure 3 - Aggregate financial inflows by in come group in 2010 (curre nt US$ mil lions) ................ 6  
Figure 4 - Average share of financial inflows by country group ................................................. 7  
Figure 5 – Aid-for-Trade disburseme nts: category sh ares, 2005/2 010 ...................................... 8  
Figure 6 – Aid-for-Trade disburse ments: donor sh ares, 2005/ 2010 .......................................... 8  
Figure 7 – Aid-for-Trade disburseme nts: recipient sh ares, 2005/2 010 ...................................... 9  
Figure 8 - Trade policy and regulation and tr ade facilitation, value (2010) and change 
(2005-10) ........................................................................................................................ 9  
Figure 9 - Aggregate financial net inflows to LDCs, 2005-2010 (cu rrent US$ m illions) ................ 10 
Figure 10 - Trends in financial inflows by LDC countries, 2005-2010 (cu rrent US$ m illions) ........ 11 
Figure 11 – Goods' and services' expo rts, 2005-2010 (current  US$ bill ions) ............................. 12 
Figure 12 – Goods' exports by inco me group (current  US$ billi ons) ......................................... 13 
Figure 13 - Top five export markets for de veloping countries' me rchandise, 2005/2010 ............. 13 
Figure 14 - Top five origin countries for developing countries' imports, 2005/2010  .................... 14 
Figure 15 - Relationship between growth in merchandise exports and export product 
concentration,  2005-2 010 ................................................................................................. 14 
Figure 16 - Merchandise exports from LDCs, 2005-2010 (current US$ millions and % 
change) .......................................................................................................................... 15 
Figure 17 - Commercial services exports from  LDCs, 2005-10 (current US$ million and % 
change) .......................................................................................................................... 16 
Figure 18 - Evolution of top five merc handise exports from  LDCs, 2005- 2010 ........................... 16 
Figure 19 - GDP per capita by country gr ouping, PPP (current internatio nal $) .......................... 17 
Figure 20 - Human development inde x (HDI) by coun try grouping .......................................... 18 
Figure 21 - GDP per capita of LDCs, PPP (current international $) and % change ....................... 18 
Figure 22 - HDI of LDCs, index (left axis ) and change in in dex (right  axis) ............................... 19 
Figure 23 - Correlation between growth in financial inflows and growth in merchandise 
exports, 2005-2010 ......................................................................................................... 20 
Figure 24 - Correlation between the leve l of Aid for Trade and export growth ............................ 21 
Figure 25 - Relationship between growth in merchandise exports and GDP per capita, 
2005-2010 in % chan ge ................................................................................................... 22 
Figure 26 - Relationship between GDP per capita growth and HDI growth , 2005-2 010................ 23 
 
Table of  Tables 
 
Table 1- Composition of Financial In flows to LDCs by  country, 2010 ........................................ 10 
Table 2 - Countries and country gr oupings used in the analysis .............................................. 27 
 WT/COMTD/AFT/W/48 
 
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  1  OVERVIEW AND MAIN FINDINGS 
1.1.  One of the functions of the Aid-for-Trade Initiative is to monitor the demand and supply of 
Aid for Trade and to evaluate the effectiveness in delivering results on the ground. One innovation of the 2013 edition of the WTO-OECD Aid for Trade at a Glance monitoring report was the inclusion 
of national fact sheets that were based on a results chain framework at the macro level for the 
period 2005 to 2010/11. This methodology seeks to examine how development finance inflows are linked to trade and development outcomes.
1 Figure 1 below highlights how this approach has been 
conceptualized in the design of the 2013 fact sheets. 
Figure 1 - Results Chain Framework to Conceptualize Trade and Development - 
Performance in Developing Countries 
Inputs Outputs Outcomes Impacts
Investment  and 
financing
Indicators  include:
•Aid for Trade
•Trade‐related non‐
concessional  flows
•Foreign direct 
investment
•Workers remittances
•Long term external 
debt and IMF 
disbursementsIndicators  include:
•Goods exports
•Services exports
•Top 5 markets and 
productsTrade performance Trade  indicators Development  
indicators
Indicators  include:
•Export product 
concentration  Indicators  include:
•GDP per capita 
•Human Development  
Index (HDI)
 
Source: WTO Secretariat. 
Note: Details on the indicators used can be found in Annex II. While the fact  sheets covered several 
indicators, Figure 1 only shows the indicators used in this study. 
 
1.2.  The fact sheets contained in the WTO/OECD Aid for Trade at a Glance 2013 publication provide factual information for the period 2005-2010. Data in each of the categories is reported 
(where available) for the 80 developing countries that responded to the Aid-for-Trade 
self-assessment monitoring questionnaire in 2012/2013.  
1.3.  The aim of this report is threefold. First, it  provides an analysis of the 80 country fact sheets 
at the aggregate level, including for the five country groupings Least-developed countries (LDCs), 
Lower Middle Income Countries (LMICs), Upper Middle Income Countries (UMICs), Small and Vulnerable Economies (SVEs), and Landlocked Developing Countries (LLDCs).
2 Furthermore, more 
detailed analysis is provided for LDCs, which are particularly reliant on aid for trade. This 
aggregate analysis highlights commonalities and differences between country groupings.  
1.4.  Second, the study assesses Aid for Trade and development finance from a results chain 
perspective by describing the relationships between development finance and trade performance, 
and between trade performance and development im pacts. The discussion of these relationships 
allows policymakers to better understand the role of investment and financial flows in achieving development objectives. Furthermore, the study co mplements a growing body of research pointing 
to the positive role and challenges of Aid for Trade in fostering trade and development impacts. 
1.5.  A third objective of the analysis is to ill ustrate the explanatory power of the fact sheets, 
thereby providing inputs to the discussion on how to  further refine the approach taken by the fact 
sheets and the methodology used. Therefore, the analysis is limited to the data and variables of 
the fact sheets, even if newer data such as in the case of Aid for Trade exist. 
1.6.  Since the analysis is based on data for 80 developing countries for the time-period 
2005-2010/11, conclusions drawn are based only on the sample i.e. those who also replied to the 
                                               
1 Results based management tracks how inputs beco me outputs, outputs generate outcomes, and in 
turn outcomes become impacts. 
2 Annex I provides more details regarding the sample of countries and the composition of the respective 
country groups. WT/COMTD/AFT/W/48 
 
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  partner country questionnaire. For instance, a number of countries from the income groups of 
LMICs (e.g. Philippines, Egypt) and UMICs (e.g. China, Namibia) have not been included in the fact sheets and are therefore also not included in the income group aggregates.   
1.7.  Another important limitation of the analysis is data availability. For many indicators included 
in the fact sheets, data are missing for several coun tries. For example, the lack of export data for 
Bangladesh, Nepal, Lesotho and Afghanistan results in an underestimation of the importance of textiles and apparel exports for LDCs. In some cases, this was remedied by using data from the 
closest available year.
3  
1.8.  The fact sheets rely on the OECD, DAC-Creditor Reporting System (CRS) Aid Activities 
Database for Aid for Trade and trade-related Other Official Flows disbursements. Disbursement data do not capture South-South flows of trade-related assistance, which is mostly not reported to 
the OECD.   
1.1  Key Conclusions 1.9.  The following general conclusions can be drawn: 
a. Financial inflows to the 80 developing countries increased by more than 62% between 
2005 and 2010. Aid for Trade remains of particular importance for LDCs and accounts, on average, for 20% of their external financial inflows. Support for trade facilitation has 
increased significantly between 2005 and 2010 grow ing at a faster rate than overall Aid 
for Trade. 
b. Between 2005 and 2010 goods' and servic es' exports increased by 66% and 70% 
respectively for the 78 countries for which data were available. Goods exports increased 
the most for LDCs, LLDCs and LMICs with 98%, 102% and 83%, respectively. In the 
case of LDCs, export growth has been dr iven by primary commodities leading to 
increased product concentration in several countries.  
c. South-South trade is proving an important driver for market diversification. Between 
2005 and 2010, China and India moved into the top five export and import markets for an increasing number of developing countries. 
d. Developing countries experienced positive development trends as captured by the 
indicators GDP per capita and human development index. In particular, GDP per capita increased the most for poor countries, i.e. on average by 27% for LDCs and 30% for LLDCs. Furthermore, all LDCs in the sample improved their human development index 
score between 2005 and 2010. 
e. The assessment of the fact sheets from a results chain perspective at the macro level 
highlights the positive relationships between development finance and trade 
performance as well as between trade performance and development impacts. The 
analysis suggests positive correlations betw een Aid for Trade and export growth and 
between export growth and GDP per capita income growth.  
                                               
3 The choice of indicators was itself  influenced by the availability of time series data. New indicators are 
appearing which may, in some cases, be more fitting for the purpose of th is analysis. However, the absence of 
historical data and geographic coverage mean s they were not appropriate for inclusion. WT/COMTD/AFT/W/48 
 
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  2  FINANCIAL INFLOWS 
2.1.  Development finance refers to external  financial inflows to developing countries. 
Development finance can come in different forms,  including foreign direct investment (FDI), 
Official Development Assistance (ODA), remittances, non-concessional flows or Other Official Flows 
(OOFs) and long term external debt.4 
2.2.  Financial inflows to the 80 economies cove red by the fact sheets increased by more than 
62% between 2005 and 2010. Figure 2 shows that disbursement of long term external debt, 
workers' remittances and FDI are the main sources of external finance to these countries and 
increased respectively by 65%, 68%, and 38% between 2005 and 2010. 
2.3.  While Aid for Trade and trade-related OOFs are smaller in size compared to other financial 
flows, they grew at a faster pace. In particular, trade-related OOFs more than tripled and Aid for 
Trade disbursements more than doubled between 2005 and 2010. Furthermore, Aid for Trade has 
been stable over time. In contrast, FDI and long-term external debt have been volatile, experiencing a sharp decline during the 2007-20 09 Great Recession. Meanwhile, the multilateral 
response to the Great Recession led to a temporary increase of OOFs. 
Figure 2 - Aggregate financial in flows 2005-2010 (current US$ millions) 
050,000100,000150,000200,000250,000
2005 2006 2007 2008 2009 2010Trade‐related non‐concessional  flows Aid‐for‐Trade disbursements
FDI inflows Long‐term external debt
Workers' remittances 
 
Sources: OECD, DAC-CRS Aid Activiti es Database; World Bank, World De velopment Indicators; World Bank, 
International Debt Statistics. 
Note: Official development assistance  and Other Official Flows that are not Aid for Trade or trade-related 
are not covered. Graphs are based on data for 80 countries. Long term external debt and workers' 
remittances are underestimated due to missing data for few countries, e.g. missing data for eight 
and twelve countries in 2010, respectively. 
 
2.4.  Figure 3 shows different financial inflows by income group in 2010. Middle income countries 
were the largest recipients of all financial inflows, except Aid for Trade, for which LDCs were the main beneficiaries.
5 Remittances were the largest financial inflow for all income groupings except 
UMICs. Disbursements of long-term external debt to  UMICs were substantially higher than to other 
income groups. Trade-related OOFs go mainly to  more economically-developed countries, i.e. 
                                               
4 Aid for Trade is a subset of official development assistance. Trade-related non-concessional flows also 
cover only Aid for Trade sectors. Long-term external debt is defined as debt that has an original or extended maturity of more than one year and that is owed to non-residents by residents of an economy and repayable in c u r r e n c y ,  g o o d s ,  o r  s e r v i c e s .  I t  a l s o  i n c l u d e s  I M F  p u r c h a s e s ,  w h i c h  a r e  t o t a l  d r a w i n g s  o n  t h e  G e n e r a l  Resources Account of the IMF during the year specif ied, excluding drawings in the reserve tranche. 
5 It should be noted that LDCs are the biggest be neficiaries of Aid for Trade in the sample of 80 
developing countries used in this study. For a broade r sample, Aid for Trade data show that LMICs were the 
biggest beneficiaries in 2012.  WT/COMTD/AFT/W/48 
 
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  UMICs and LMICs. For instance, low income countries  traditionally receive less than 3% of overall 
OOFs. 
Figure 3 - Aggregate financial inflows by income group in 2010 (current US$ millions) 
020,00040,00060,00080,000100,000120,000140,000
Trade‐related
OOFsAid‐for‐Trade
disbursementsFDI Long ‐term
external debtRemittancesUMICs LMICs LDCs SVEs LLDCs
 
Sources: OECD, DAC-CRS Aid Activiti es Database; World Bank, World De velopment Indicators; World Bank, 
International Debt Statistics. 
Note: Country groupings cover the following number of  countries: LDCs: 35; LMICs: 17; UMICs: 19; SVEs: 
18; LLDCs: 17. Remittances are underestimated as no  data were available for 8 LDCs, 4 LLDCs and 
1 UMIC. 
 
2.5.  Looking at the average share of Aid for Trad e in financial inflows by country reveals that Aid 
for Trade remains relevant (Figure 4). Aid for Trade accounts, on average, for about 20% of financial inflows in LDCs and LLDCs. In contrast, in UMICs, LMICs and SVEs Aid for Trade 
constitutes on average less than 10% of financial inflows. For these countries, FDI flows are 
relatively bigger in size. For instance, for UMICs, FDI is the most important source of development finance accounting for almost 40% of inflows. Meanwhile, for all country groupings except UMICs, remittances constitute, on average, the biggest external finance resource. WT/COMTD/AFT/W/48 
 
- 7 - 
 
  Figure 4 - Average share of fina ncial inflows by country group 
20%
6%4%8%21%1%
2%2%2%1%24%
28%39%29%25%22%
28%32%
28%25%33%36%23%
33%28%
LDCs LMICs UMICs SVEs LLDCsAFT Trade‐related OOFs FDI External debt Remittances
 
Sources: OECD, DAC-CRS Aid Activiti es Database; World Bank, World De velopment Indicators; World Bank, 
International Debt Statistics. 
Note: Country groupings cover the following number of  countries for all indicato rs: LDCs: 27; LMICs: 17; 
UMICs: 18; SVEs: 18; LLDCs: 13. 
 
2.6.  Aid for Trade to the 80 developing countri es surveyed increased by 131% between 2005 and 
2010. During this period, there was little change in the distribution of Aid for Trade to different categories (Figure 5). Aid for Trade was mainly spent on transport and energy infrastructure as 
well as agriculture, forestry and fishing. In particular, in 2010 these three categories accounted for 
more than 75% of total disbursements. 
2.7.  The top five Aid-for-Trade donors in 2010 were Japan, USA, the World Bank, Germany and 
EU Institutions accounting together for more than 60% of total Aid-for-Trade disbursements 
(Figure 6). However, the increasing contribution of other countries ("Other") from 21% in 2005 to 
38% in 2010 highlights that an increasing numbe r of actors play a significant role in the 
Aid-for-Trade Initiative. In addition, the growin g importance of other countries can partly be 
explained by an increasing loan share of their assi stance, while, for example, the US only provides 
grant-based Aid for Trade. WT/COMTD/AFT/W/48 
 
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  Figure 5 – Aid-for-Trade disbursements: category shares, 2005/2010 
Transport  and 
Storage
30%
Agriculture,  
forestry, fishing
25%Energy 
Generation  and 
Supply
22%Financial,  
business, tourism 
services
13%Industry
4%Trade Policy
4%Communication
2% Mining
0% 2010
Transport  and 
Storage
29%
Agriculture,  
forestry, fishing
20%Energy 
Generation  and 
Supply
21%Financial,  
business,  
tourism 
services
13%Industry
6%Trade Policy
3%Communication
3%Mining
5% 2005
 
Source: OECD, DAC-CRS Aid Activities Database. 
Figure 6 – Aid-for-Trade disbursements: donor shares, 2005/2010 
Other
21%
EU 
Institutions
10%
Germany
6%World Bank
18%United 
States
25%Japan
20%2005
Other
38%
EU 
Institutions
8%Germany
9%World Bank
12%United 
States
13%Japan
20%2010
 
Source: OECD, DAC-CRS Aid Activities Database. 
 
2.8.  Of the 80 countries studied, the top ten recipients obtained 53% of Aid-for-Trade disbursements in 2010 (Figure 7). While LDCs were the largest recipient group in the sample, the 
single main beneficiaries were LMICs and UM ICs, except for Afghanistan. Even though 
Aid-for-Trade Flows, in particular commitments, can fluctuate significantly from year to year, the fact that eight out of the top ten recipients in 2005 were also among the top ten recipients in 
2010, underscores the sustained engagement of Aid for Trade at the country level. 
 WT/COMTD/AFT/W/48 
 
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  Figure 7 – Aid-for-Trade disbursements: recipient shares, 2005/2010 
Others
47%
Bangladesh
3%Tunisia
3%Ghana
3%Ethiopia
3%Turkey
4%Tanzania
4%Morocco
4%Indonesia
6%Afghanistan
10%India
13%2010
Others
43%
Morocco
4%Indonesia
4%Tanzania
4%Ghana
4%Pakistan
4%Ethiopia
4%Mozambique
4%Bangladesh
6%Afghanistan
11%India
12%2005
 
Source: OECD, DAC-CRS Aid Activities Database. 
 
2.9.  Figure 8 shows the value and the change ov er time of Aid for Trade policy and regulation 
(TP&R) and its sub-category Aid for trade facilitation (TF) by country grouping. LDCs are the biggest recipients of both TP&R and TF. Aid for trade facilitation accounted for less than 0.5% of 
total Aid for Trade in 2010, but support has increased significantly since 2005. For instance, for the 
sample of 77 countries, aid for trade facili tation increased by 228% between 2005 and 2010 
compared to 130% for overall Aid for Trade. Fu rthermore, Figure 8 shows that, between 2005 and 
2010, aid for trade fa cilitation increased by mo re than 450% for both SVEs and UMICs and by over 
160% for LDCs. 
Figure 8 - Trade policy and regulation and trade facilitation, value (2010) and change 
(2005-10) 
0%40%80%120%160%200%240%280%320%360%400%440%480%
020406080100120
LDCs LMICs UMICs SVEs LLDCsTrade facilitation  (TF) Trade policy and regulation  (TP&R)
% Change 2005‐10 (TF) % Change 2005‐10 (TP&R)US$ mill.
 
Source: OECD, DAC-CRS Aid Activities Database. 
Note:  Trade facilitation is a sub-component of trade policy and regulation.  WT/COMTD/AFT/W/48 
 
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  2.1  Least-developed countries (LDCs) 
2.10.  For LDCs, workers' remittances were the largest financial inflow followed by FDI, long-term 
external debt, Aid for Trade and OOFs (Figure 9). Workers' remittances and Aid for Trade flows have experienced the most substantial increase between 2005 and 2010, while, FDI 
declined sharply in 2008 with a partial recovery in 2009. Relative to other income groups, 
Aid for Trade is of greater importance in LDCs as it constitutes a higher share of development finance. 
Figure 9 - Aggregate financial net inflow s to LDCs, 2005-2010 (current US$ millions) 
050001000015000200002500030000
2005 2006 2007 2008 2009 2010Trade‐related non‐concessional  flows
disbursed  (OOFs)
AfT flows disbursed
FDI inflows
Disbursements  on external debt, long‐term
+ IMF (DIS, current US$)
Workers' remittances  and compensation  of
employees,  received (current US$)
 
Sources: OECD, DAC-CRS Aid Activiti es Database; World Bank, World De velopment Indicators; World Bank, 
International Debt Statistics. 
Notes:  For workers' remitta nces, data is available for 27 out for th e 36 LDCs surveyed and not available for 
all the years sought. 
 
2.11.  In 2010, Bangladesh was by far the largest recipient of financial flows to LDCs due to 
remittances, accounting for 81% of Bangladeshi financial inflows (Table 1). In fact, Bangladesh received 44% of total remittances reported.  At the country level, Aid for Trade disbursements are 
most important for the development financing of Afghanistan, Burundi, Rwanda and Tuvalu 
accounting for 90%, 59%, 51% and 51% of their financial inflows, respectively. Across LDCs, Afghanistan was also the largest recipient receiving over 21% of total Aid for Trade followed by 
Tanzania at 9% and Ethiopia at 7%.  
2.12.  FDI is the dominant source of development finance for resource-rich countries such as 
Chad, the Democratic Republic of Congo, Zambia  and Liberia constituting respectively 90%, 88%, 
81% and 75% of financial inflows. The Democratic Republic of Congo and Zambia are also among 
the top three recipients of FDI, obtaining respec tively 19% and 11% of FDI to LDCs. The D.R. of 
Congo, Zambia and Sudan (14%) account for 44% of all inward FDI, which illustrates the concentration of FDI in capital-intensive industries of resource-rich countries. 
Table 1- Composition of Financial Inflows to LDCs by country, 2010 
 Financial 
inflows 
 Aid for 
Trade Trade-rel. 
OOFs FDI Workers' 
remittances External 
debt 
  US$ million % 
Bangladesh 13,344 3.5 1.1 6.9 81.3 7.2 
Sudan 5,256 5.3 0.1 39.3 37.6 17.8 
Nepal 3,985 6.3 0.0 2.2 87.0 4.4 
D.R. of Congo 3,343 8.6 0.0 87.9 n.a. 3.5 
Ethiopia 2,953 18.9 0.0 9.8 7.6 63.8 
Tanzania 2,453 29.9 0.1 17.7 1.0 51.3 
Uganda 2,404 17.6 1.5 22.6 38.0 20.2 WT/COMTD/AFT/W/48 
 
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   Financial 
inflows 
 Aid for 
Trade Trade-rel. 
OOFs FDI Workers' 
remittances External 
debt 
Haiti 2,376 13.2 0.1 6.3 63.1 17.3 
Senegal 2,319 10.6 0.2 10.2 58.0 20.9 
Zambia 2,149 5.4 0.4 80.5 2.0 11.7 
Afghanistan 1,940 90.2 1.4 3.9 n.a. 4.5 
Yemen 1,812 9.7 0.0 3.1 68.4 18.8 
Cambodia 1,715 12.3 0.3 45.6 21.5 20.2 
Mozambique 1,677 20.4 2.1 47.1 7.9 22.5 
Madagascar 1,406 9.0 14.8 61.2 0.0 15.0 
Niger 1,271 10.0 1.2 74.5 6.9 7.5 
Mali 1,238 27.2 0.0 11.9 35.2 25.7 
Lesotho 940 2.6 0.0 12.4 79.3 5.6 
Chad 865 3.1 0.0 90.3 n.a. 6.6 
Benin 753 24.6 0.0 14.7 32.9 27.8 
Burkina Faso 659 35.1 0.0 5.6 14.4 44.9 
Liberia 606 17.8 0.3 74.6 4.4 2.8 
Mauritania 600 19.5 3.9 2.3 n.a. 74.3 
Togo 538 6.8 0.0 7.6 61.9 23.7 
Malawi 424 43.5 0.0 33.0 0.0 23.6 
Rwanda 398 50.8 0.0 10.6 23.1 15.4 
Bhutan 310 28.1 6.8 6.1 1.6 57.4 
Guinea 260 23.9 0.0 38.9 23.2 13.9 
Samoa 256 12.7 0.0 0.3 56.1 30.9 
Comoros 237 3.3 1.1 4.0 n.a. 91.6 
Gambia 234 14.4 0.0 16.0 49.5 20.1 
Burundi 206 58.9 0.0 0.4 13.7 27.0 
Djibouti 165 22.5 12.9 22.1 19.8 22.6 
Central 
African Rep. 126 27.5 0.0 57.2 n.a. 15.3 
Vanuatu 81 44.1 0.0 48.0 7.9 0.0 
Tuvalu 3 51.4 0.0 48.6 n.a. n.a. 
Sources: OECD, DAC-CRS Aid Activiti es Database; World Bank, World De velopment Indicators; World Bank, 
International Debt Statistics. 
 
2.13.  Figure 10 further reveals the heterogeneit y of LDCs regarding financial inflows using the 
examples of Bangladesh, Burkina Faso and Cambodia. Financial inflows of Bangladesh are dominated by remittances, which more than doubled between 2005 and 2010. On the other hand, 
Burkina Faso relies more on Aid for Trade and long-term external debt. Lastly, Cambodia attracts 
mainly FDI. The difference in scale for the th ree countries must be noted; Bangladesh and 
Cambodia receive substantially more inflows than Burkina Faso.  
Figure 10 - Trends in financial inflows by LDC countries, 2005-2010 (current US$ 
millions) 
020004000600080001000012000
2005 2006 2007 2008 2009 2010Bangladesh
Trade‐related non‐concessional  flows disbursed  (OOFs)
AfT flows disbursed
FDI inflows
Disbursements  on external debt, long‐term + IMF (DIS, current US$)
Workers' remittances  and compensation  of employees,  received (current US$)050100150200250300350400
2005 2006 2007 2008 2009 2010Burkina Faso
Trade‐related non‐concessional  flows disbursed  (OOFs)
AfT flows disbursed
FDI inflows
Disbursements  on external debt, long‐term + IMF (DIS, current US$)
Workers' remittances  and compensation  of employees,  received (current US$)01002003004005006007008009001000
2005 2006 2007 2008 2009 2010Cambodia
Trade‐related non‐concessional  flows disbursed  (OOFs)
AfT flows disbursed
FDI inflows
Disbursements  on external debt, long‐term + IMF (DIS, current US$)
Workers' remittances  and compensation  of employees,  received (current US$) 
Sources: OECD, DAC-CRS Aid Activiti es Database; World Bank, World De velopment Indicators; World Bank, 
International Debt Statistics. WT/COMTD/AFT/W/48 
 
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3  TRADE PERFORMANCE AND TRADE INDICATORS 
3.1.  Trade performance and trade indicators represent outputs and outcomes in the macro-level 
results chain framework used in the fact sheets.  While factors such as policy and development 
finance affect trade performance, it is actually th e direct objective of Aid for Trade interventions to 
increase countries' trade performance or to lower trade costs. This section assesses the trends of developing countries in terms of trade performance and indicators.  
3.2.  Aggregate data on goods and commercial se rvices exports from the 78 developing countries 
in the sample show an upward trend during the period 2005-10 (Figure 11). Merchandise goods' exports increased by 66% between 2005 and 2010 from close to US$800billion to close to US$1,300 billion. Even though goods' exports expe rienced a decline in 2009 following the onset of 
the financial crisis, they recovered quickly in 2010. Services' exports are lower in value terms 
accounting for less than 20% of total exports. Howe ver, services' exports grew at a faster rate 
than goods' exports, increasing by 70% between 2005 and 2010.  
Figure 11 – Goods' and services' ex ports, 2005-2010 (current US$ billions) 
02004006008001,0001,2001,400
2005 2006 2007 2008 2009 2010Goods' export Services' export
 
  Source: WTO Secretariat. 
 Note:  Based on 78 countries for which data are available. 
 
3.3.  Goods' exports increased for all income gr oups (Figure 12). LDCs and its sub-group LLDCs 
experienced the greatest increases in goods' exports with 98% and 102%, respectively. In terms 
of value, lower-middle income countries narrowed the gap to upper-middle income countries with both country groups exporting more than US$570 billion. WT/COMTD/AFT/W/48 
 
- 13 - 
 
  Figure 12 – Goods' exports by in come group (current US$ billions) 
+98%+83%+48%
+37%+102%
0100200300400500600
LDCs LMICs UMICs SVEs LLDCs2005 2010
 
 Source: WTO Secretariat. 
 Note:  Country groupings cover the following numb er of countries: LDCs: 36; LMICs: 18; UMICs: 
22; SVEs: 21; LLDCs: 17. 
 
3.4.  The increasing importance of South-South trade has led to export market diversification. 
Data on the top five markets for developing countries' merchandise imports and exports show the increasing presence of emerging economies, nota bly India and China, as major trading (Figure 13 
and Figure 14). For instance, while in 2005 China was among the top five export markets for 13 
developing countries, in 2010, this was the case for 17 developing countries. On the import side, this trend is even more significant where in 2010, China was among the top 5 origin markets for 
51 developing countries.
6 
Figure 13 - Top five export markets for developing countries' merchandise, 2005/2010 
EU, 60
USA, 42
Switzerland,  
13China, 13 India, 9Japan, 9S. Africa, 9UAE, 9Brazil, 4Other, 652005 
EU, 49
USA, 34
Switzerland,  
13China, 
17
India, 13Japan, 6S. Africa, 10UAE, 9Brazil, 5Other, 552010 
 
Source: WTO Secretariat. 
 
                                               
6 A report on rising powers in development (IDS, 2013) provides complementary insights regarding the 
increasing importance of South-South trade. In particul ar, it shows that ten emerging economies accounted for 
more than 30% of imports and 28% of exports of Sub-Sa haran Africa in 2010. China plays a significant role 
with shares of close to 15% in both exports and imports of Sub-Saharan Africa in 2010. WT/COMTD/AFT/W/48 
 
- 14 - 
 
  Figure 14 - Top five origin countries fo r developing countries' imports, 2005/2010 
EU, 61
USA, 44
Swizerland,  3China, 35
India, 8Japan, 25 S. Africa, 10UAE, 10Brazil, 13Other, 592005 
EU, 49
USA, 33
Swizerland,  1China, 51
India, 12Japan, 12S. Africa, 10UAE, 9Brazil, 8Other, 482010 
 
Source: WTO Secretariat. 
 
3.5.  Figure 15 shows a slight positive correl ation between growth in merchandise exports and 
changes in export product concentration. In othe r words, developing countries with the highest 
growth in exports tend to become less diversified as the value of their main exports increases. 
Zambia and Ghana are examples where export growth was driven by few products. For resource-rich countries, higher commodity prices can ex plain export growth that is accompanied by 
increasing export product concentration. For instance, in the case of Zambia, the share of copper 
in merchandise export increased from 55% in 2005 to 75% in 2010. 
3.6.  Importantly, this does not imply that other sectors could not increase their exports, but that 
growth in other sectors was masked by the high gr owth of commodity exports. However, if export 
growth is weak and export concentration nevertheless increases, this indicates falling exports for 
some sectors. For instance, for the Central African Republic exports only increased by 9%, while export concentration, mainly in diamonds, increased significantly. 
Figure 15 - Relationship between growth in merchandise exports and export product 
concentration, 2005-2010 
Belize
BeninBurkina FasoBurundiCentral African 
Republic
Colombia
DominicaGhana
JamaicaMalawiMali
MozambiqueNiger
NigeriaYemenZambia
‐0.4‐0.3‐0.2‐0.100.10.20.3
‐50% 0% 50% 100% 150% 200% 250%Change in export product concentration
Growth in merchandise  exports
 
Source:  WTO Secretariat and UN Comtrade. 
Notes:  Concentration in exported products is measured by the Hirsch man-Herfindahl index, which ranges 
from close to zero (perfectly dive rsified export portfolio) to on e (the country exports only one 
product). WT/COMTD/AFT/W/48 
 
- 15 - 
 
   
3.1  Least-developed countries (LDCs) 
3.7.  Figure 16 and Figure 17 show that all LDCs  experienced increases in both merchandise and 
services exports between 2005 and 2010. LDCs also  experienced the largest growth in exports 
compared to other groups, albeit from a low basis.  
3.8.  Merchandise exports were dominated by Bangladesh accounting for 20% of total LDC exports 
in 2010 followed by Sudan (12%). Large increases in merchandise exports were achieved by the 
Democratic Republic of Congo, Zambia, Mauritania and Burkina Faso. 
3.9.  Trade reforms and reduction in trade barriers conducted in the context of WTO accession 
have been important for some in this regard. For instance, Samoa, which acceded to the WTO in 2011, increased its exports by more than 190% between 2005 and 2010.  
Figure 16 - Merchandise exports from LD Cs, 2005-2010 (current US$ millions and % 
change) 
‐50%0%50%100%150%200%250%300%
05,00010,00015,00020,00025,000
Comoros
Samoa
Vanuatu
DjiboutiBurundi
Central African Republic
Gambia
Liberia
Rwanda
Bhutan
Haiti
Lesotho
Nepal
Togo
Madagascar
Niger
Malawi
Benin
Guinea
Burkina Faso
Mali
Mauritania
Uganda
Senegal
Mozambique
Ethiopia
Chad
Tanzania
Cambodia
Zambia
Yemen
D. R. of Congo
Sudan
Bangladesh
2005 2010 %Change
 
Source:  WTO Secretariat  
 
3.10.  During the same period, services expo rts were dominated by Tanzania, Ethiopia and 
Cambodia, mainly in the area of tourism (Figure 17). Growth in services exports tells an 
interesting story. The highest growth was experi enced in Yemen and Burkina Faso; two countries 
with a dominant fuels and mining sector that also experienced high growth of merchandise exports. WT/COMTD/AFT/W/48 
 
- 16 - 
 
  Figure 17 - Commercial servic es exports from LDCs, 2005- 10 (current US$ million and % 
change) 
‐100%0%100%200%300%400%500%
05001,0001,5002,0002,500
Burundi
Liberia
Lesotho
Comoros
Guinea
Bhutan
Mauritania
Gambia
Niger
Malawi
Djibouti
Samoa
Haiti
Sudan
Rwanda
Burkina Faso
Vanuatu
Togo
D. R. of Congo
Zambia
Benin
Mali
Mozambique
Nepal
Senegal
Madagascar
Uganda
Bangladesh
Yemen
Cambodia
Ethiopia
Tanzania
2005 2010 % Change
 
Source:  WTO Secretariat. 
 
3.11.  Even though LDCs are becoming more di versified in terms of markets, exports remain 
concentrated in fuels and mining, agricultural commodities, and textiles and clothing. Figure 18 
shows how often products were among the top five export products of LDCs. It is apparent that 
fuels, mining and agricultural products remain th e main export categories. It must, however, be 
noted that textiles and apparel may be underestimated due to data limitations for major exporters. 
Figure 18 further shows the ongoing role of fuels and mining for LDCs: fuels and mining products appeared 41 times as top five exports in 2010 compared to 36 times in 2005.   
Figure 18 - Evolution of top five me rchandise exports from LDCs, 2005-2010 
051015202530354045No. of mentions  in top 5 exports
2005 2010
 
Source: WTO Secretariat. 
Note:  Data on top five exports were unavailable fo r Afghanistan, Bangladesh, Central African Republic, 
Djibouti, Lesotho, Nepal, Sudan, and Vanuatu. 
 WT/COMTD/AFT/W/48 
 
- 17 - 
 
  3.12.  The "commodity super-cycle" of the past decade, has increased the weight of commodities 
in LDCs export basket. This ph enomenon explains the large grow th in merchandise exports for 
countries engaged in extractive industries with positive spin-off effects for trading partners. 
3.13.   Burkina Faso and Mauritania increased their exports of gold, most of which is going to 
Switzerland and South Africa for further processing . As a result, Switzerland and South Africa are 
rapidly gaining market share in terms of value.  
3.14.  However, it must also be noted that due to  large growth in the export of fuels and mining, 
growth in the export of other goods have not been reflected. Figure 18 shows that light 
manufacturing, chemicals and livestock are becoming  more prevalent in the top exports of LDCs. 
Furthermore, Escaith and Tamenu (2013) found that for other export categories from LDCs; "whereas most types of exporters enjoyed a simila r export growth in terms of volume, they fared 
differently when it came to the evolution of the prices of their exports". 
4  DEVELOPMENT INDICATORS 4.1.  Development interventions such as Aid fo r Trade seek to achieve development impacts, 
which represent the last link in the results-chain framework. This section uses GDP per capita and 
the Human Development Index (HDI) to summarise the trends and achievements of developing 
countries in economic and human development. 
4.2.  Developing countries of all income groups experienced, on average, positive economic 
development between 2005 and 2010 (Figure 19). GD P per capita increased on average the most 
in the poorest countries, i.e. by 30% in LLDCs an d by 27% in LDCs. While this increase has been 
partly driven by the rise in commodity prices, it also reflects that these countries started from a 
lower base compared to, for instance, UMICs. De spite their higher economic growth, the average 
GDP per capita of LDCs in 2010 was still less than  one third of the average GDP per capita of 75 
developing countries.  
Figure 19 - GDP per capita by country grouping, PPP (current international $) 
+23%
+27%+24%+22%
+16%
+30%
 ‐ 2,000 4,000 6,000 8,000 10,000 12,000 14,000
ALL LDCs LMICs UMICs SVEs LLDCs2005 2010
 
 Source: World Bank, World Development Indicators. 
 Notes: GDP per capita by country grouping are simple averages and based on 75 countries for 
ALL, 35 for LDCs, 18 for LMICs, 22 for UMICs, 20 for SVEs and 16 for LLDCs. 
 
4.3.  The Human Development Index takes a broader approach towards development, capturing not only GDP per capita, but also life expectancy  and schooling. On average, all country groupings 
increased their HDI between 2005 and 2010 (Figure 20).  WT/COMTD/AFT/W/48 
 
- 18 - 
 
  Figure 20 - Human development index (HDI) by country grouping 
0.000.100.200.300.400.500.600.700.80
ALL LDCs LMICs UMICs SVEs LLDCs2005 2010
 
 Source:  UNDP, International Human Development Indicators. 
 Notes:  The HDI ranges from 0 (minimum de velopment) to 1 (maximum development). HDI 
aggregates are simple averages and based on 68 countries for ALL, 33 for LDCs, 18 for 
LMICs, 16 for UMICs, 14 for SVEs and 16 for LLDCs. 
 
4.1  Least-developed countries (LDCs) 
4.4.  All LDCs experienced an increase in their GDP per capita between 2005 and 2010 (Figure 21). 
Ethiopia, Liberia and Buthan could increase their GDP per capita by more than 50% between 2005 
and 2010. Bhutan, Vanuatu and Samoa, which are expected to graduate from LDC status in 2014, are the LDCs with the highest GDP per capita.  
Figure 21 - GDP per capita of LDCs, PPP (current international $) and % change 
0%10%20%30%40%50%60%70%
01,0002,0003,0004,0005,0006,000
D. R. of Congo
Liberia
Burundi
Niger
Central African Republic
Malawi
Mozambique
Madagascar
Togo
Ethiopia
Afghanistan
Mali
Guinea
Comoros
Haiti
Rwanda
Nepal
Burkina Faso
Uganda
Tanzania
Chad
Zambia
Benin
Lesotho
Bangladesh
Senegal
Gambia
Cambodia
Sudan
Djibouti
Mauritania
Yemen
Samoa
Vanuatu
Bhutan2010 2005 % change
 
Source: World Bank, World Development Indicators. 
 
4.5.  Figure 22 shows that the Human Development Index increased for all LDCs for which data 
are available. Countries that improved the mo st on their situation compared to 2005 were 
Afghanistan, Rwanda, Burundi, Ethiopia and Mala wi. The fact that no LDC stepped backward in 
terms of development, can be regarded as an encouraging sign. Nevertheless, the distance to 
more developed countries, in particular in economic terms, appears still substantial.  WT/COMTD/AFT/W/48 
 
- 19 - 
 
  Figure 22 - HDI of LDCs, index (left ax is) and change in index (right axis) 
00.010.020.030.040.050.06
00.10.20.30.40.50.60.70.8
D. R. of Congo
Niger
Burundi
Mozambique
Liberia
Chad
Burkina Faso
Central African Republic
Guinea
Mali
Ethiopia
Afghanistan
Malawi
Sudan
Gambia
Benin
Rwanda
Zambia
Djibouti
Comoros
Togo
Uganda
Lesotho
Haiti
Mauritania
Nepal
Senegal
Yemen
Tanzania
Madagascar
Bangladesh
Bhutan
Cambodia
Vanuatu
Samoa2010 2005 Change
 
Source: UNDP, International Human Development Indicators. 
 
5  THE RESULTS CHAIN PERSPECTIV E APPLIED AT THE MACRO LEVEL 
5.1.  The first part of this paper focused on describing the trends in the indicators pertaining to the 
four elements of the results chain framework at the macro level (Figure 1), namely investment financing (inputs), trade performance and indica tors (outputs and outcomes) and development 
indicators (impacts) for diffe rent country groupings.  
5.2.  This second part provides an assessment of  the linkages between the elements of the results 
chain framework. In particular, it will touch upon the relationships between development finance 
and trade performance (outputs and outcomes) and between trade performance and development 
impacts. As already mentioned at the beginning of  the paper, the aim of the analysis is not to 
assess possible causal effects but rather to describe correlations between the different indicators.  
5.1  Development finance and trade performance 
5.3.  Correlations between financial inflows and exports of goods and services illustrate the 
relationship between development finance (i nputs) and trade performance (outputs and 
outcomes). 
5.4.  Figure 23 shows a positive relationship between growth in financial inflows and growth in 
merchandise exports between 2005 and 2010 for 68 countries. Mauritania and the Democratic Republic of Congo recorded the highest growth in both financial inflows and merchandise exports. 
In the case of the Democratic Republic of Congo, the link between financial inflows and exports 
works mainly through FDI in extractive industries and subsequent exports of primary commodities. Countries that experience negative growth in merchandise exports were the SVEs Antigua and Barbuda, Saint Kitts and Nevis, Jamaica, Domi nica, and Grenada. Vanuatu recorded negative 
growth in financial inflows accompanied by relatively low growth in merchandise exports. WT/COMTD/AFT/W/48 
 
- 20 - 
 
  Figure 23 - Correlation between growth in financial inflows and growth in merchandise 
exports, 2005-2010 
Antigua and BarbudaSaint Kitts and NevisJamaicaDominica GrenadaVanuatuMauritaniaD. R. of Congo
R² = 0.1432
‐100%‐50%0%50%100%150%200%250%300%
‐200%‐150%‐100% ‐50% 0% 50% 100% 150% 200% 250% 300% 350%% Change in merchandise  exports
% Change in financial inflows
 
Sources: WTO Secretariat, OECD, DAC-CRS Aid Acti vities Database; World Bank, World Development 
Indicators; World Bank, Inte rnational Debt Statistics. 
Notes: Six countries with a more than 400% incr ease in financial inflows between 2005 and 2010 have 
been excluded from the graph. 
 
5.5.  Development finance consists of a variety of different financial inflows, including FDI, ODA, 
which includes Aid for Trade, OOFs, loans and remittances, which are related to trade through 
different channels. For instance, FDI targets economic activities and is thereby closely linked to 
trade. However, the effects of FDI on trade differ depending on whether FDI is horizontal (market seeking), vertical (resource seeking) or used to cr eate export platforms to serve third markets. In 
contrast, Aid for Trade supports infrastructure financing, strengthens government capacities or 
addresses other market failures to help firms overcome supply-side constraints. More broadly, ODA targets also other development issues that are only indirectly related to trade such as health or education. Remittances affect trade mainly through the demand side by financing household 
consumption. 
5.6.  Given this variety, it is not surprising that each source of development finance and its 
relationship with trade performance has been subject to a distinct assessment in the academic 
literature. However, due to the focus of this study, only the link between Aid for Trade and trade 
performance is described in more detail. 
5.1.1  Aid for Trade and trade performance 
5.7.  Figure 24 shows a positive relationship between Aid for Trade and growth in merchandise 
exports. Obviously, this scatterplot does not imply causality and does not control for other factors that affect export growth. Nevertheless, it provides a first illustrative evidence in line with the findings from the empirical literature.  WT/COMTD/AFT/W/48 
 
- 21 - 
 
  Figure 24 - Correlation between the leve l of Aid for Trade and export growth 
D. R. of Congo
MauritaniaZambia
Burkina Faso
Samoa
Ghana
Saint Lucia
EthiopiaBhutanParaguay Tanzania
NigerSudan
Rwanda Malawi
BeninIndia
Djibouti
UgandaUruguay
Bangladesh Peru
Congo
Nicaragua
Colombia MaliLiberia IndonesiaZimbabwe
Cambodia Guinea
P.N.G.SurinamePanama
BurundiMorocco
JordanGambiaComorosGuatemalaTunisia TurkeyTogo
Cape VerdeKenyaCôte d'IvoireBelize
Mexico Pakistan Nigeria
Senegal GabonVanuatu LesothoCosta RicaMozambique El Salvador
MadagascarHaitiFijiYemen
Chad
HondurasTrinidad and Tobago
C.A.R.
Dominican  Rep.MauritiusSt. V. & G.Botswana Nepal
Grenada
Dominica
Jamaica
Saint Kitts and Nevis
Antigua and Barbuda
-50%0%50%100%150%200%250%
14 15 16 17 18 19 20 21 22 23Change in merchandise  exports  2005‐2010
Logarithm  of Aid for Tade 2005‐2007
 
Sources: WTO Secretariat; OECD, DAC-CRS Aid Activities Database. 
 
5.8.  Existing empirical analyses (reviewed in OECD-WTO, 2013a) come to the conclusion that Aid 
for Trade is positively correlated with trade expansion and reductions in trade costs. The impact of 
Aid for Trade on trade costs or trade performance,  will, however, vary depending on the type and 
purpose of aid, country characteristics and, of co urse, on factors related to the implementation of 
projects. For instance, (OECD-WTO, 2013a) report research that US$1invested in Aid for Trade in 
International Development Association (IDA)-eligible countries is associated with an expected US$20 increase in exports compared to an average expected US$8 increase for developing countries. However, since generalisations are difficult, the sectors and type of instruments of Aid 
for Trade interventions should be tailored to the necessities of specific countries and regions.  
5.1.1.1  Aid for trade facili tation and trade performance 
5.9.  Relatively few empirical studies exist that  assess the relationship between, on the one hand, 
aid for trade facilitation and, on the other, trad e costs and trade performance at the macro level. 
Nevertheless, empirical analyses suggest that aid for trade facilitation reduces the cost of trading (Calì and te Velde, 2011; Busse et al., 2012) an d increases trade performance (Helble et al., 
2012).  
5.10.  Case studies provide another source of evid ence regarding the effectiveness of aid for trade 
facilitation. The 3
rd Global Review of Aid for Trade in 2011 gathered 269 case stories, 62 of which 
relate to trade facilitation, including hard infrastructure investments, trade policy, customs 
regulations, border crossings and the business environment (OECD-WTO, 2013b). These case 
stories highlight several key factors for the success of a project with ownership and political commitment by the recipient country being the mo st important. Further success factors include 
strong involvement of local stakeholders, in particular the private sector, as well as efficient 
coordination among donors and recipients. WT/COMTD/AFT/W/48 
 
- 22 - 
 
  5.2  Trade performance and development impacts 
5.11.  In the previous section, it has been discussed that various development finance flows and 
Aid for Trade in particular are related to reduce d trade costs and increased exports. This section 
looks at the last link in the results chain fram ework between trade performance and development 
impacts. For policymakers it is of crucial importance to better understand the links between trade 
and development and how a better trade performance can result in positive development impacts such as higher GDP per capita, reduced poverty, or human development. 
5.12.  Figure 25 illustrates a positive correlation  between export growth and economic growth. The 
largest GDP growth rates between 2005 and 2010 were recorded for Cambodia, Uruguay, Dominican Republic, Cabo Verde, Peru, Bhutan, India, Panama, Liberia and Ethiopia. These countries also experienced high growth in exports. The countries surpassing 200% growth in 
exports had export baskets comprising mainly of fuels and mining: Burkina Faso, Zambia, 
Mauritania, and the Democratic Republic of Congo.  
Figure 25 - Relationship between growth in merchandise exports and GDP per capita, 
2005-2010 in % change 
Bhutan
Burkina FasoCambodiaCabo Verde
D. R. of CongoDominican  RepublicEthiopia
IndiaLiberia
MauritaniaPanama
Peru
Uruguay
Zambia
‐20%‐10%0%10%20%30%40%50%60%70%
‐50% 0% 50% 100% 150% 200% 250% 300% % Change in GDP/capita  (PPP)
% Change in merchandise  exports
 
Sources: WTO Secretariat; World Bank, World Development Indicators. 
 
5.13.  The WTO World Trade Report 2008 (WTO, 2008) describes theoretical predictions and empirical findings regarding the relation between trade and growth. International trade can impact 
growth through two broad channels, namely by altering the incentives to accumulate capital and 
by influencing technological progress. In particular, trade has an effect on factor prices, which changes the incentives for investment, and trade can increase the propensity of firms to innovate through increased market size, knowledge spillovers, more competition or improved quality of 
institutions. However, positive effects of trade on  economic growth might be offset, for instance, 
by specialization in sectors with low growth potential or a worsening of policies.  
5.14.  A number of empirical studies have provided  evidence of positive correlation between trade 
and growth. Even though the direction of causalit y has been subject to academic contention, trade 
plays a crucial role in the economic development strategies of countries.  
5.15.  Figure 26 shows that GDP per capita growth  is positively correlated with improvements in 
human development. Since trade is strongly linked  to economic development, trade has a broader WT/COMTD/AFT/W/48 
 
- 23 - 
 
  development impact affecting also social development for instance. In other words, as broad-
based development relies on economic development, it is crucial that sound policy and functioning institutions are in place to help make trade an engine for economic growth. 
Figure 26 - Relationship between GDP per capita growth and HDI growth, 2005-2010 
Burundi
Afghanistan
IndiaLiberiaEthiopia
00.020.040.060.080.10.120.140.160.180.2
0% 10% 20% 30% 40% 50% 60% 70%Change in HDI (0‐1)
% Change in GDP per capita (PPP)
 
 Sources:  UNDP, International Human Developm ent Indicators; World Bank, World Development 
Indicators.  
 
6  CONCLUSIONS 
6.1.  This paper has analysed 80 fact sheets prepared for the 4th Global Review of Aid Trade 
(OECD-WTO 2013a) to highlight commonalities and trends for different development country 
groupings. 
6.2.  Financial inflows to the 80 developing countries increased by more than 62% between 2005 
and 2010. Even though lower in size than other in flows such as FDI, Aid for Trade has grown at a 
faster pace with disbursement more than  doubling over the five year period.  
6.3.  For all country groups except UMICs, remitta nces constitute, on average, the biggest source 
of external financing. Aid for Trade is of part icular importance for LDCs, which are the main 
beneficiaries of Aid for Trade in the sample and where Aid for Trade accounts for a higher share 
relative to other financial flows. In particular, Aid for Trade accounts, on average, for 20% of 
financial inflows in LDCs and 21% in LLDCs.  
6.4.  Even though aid for trade facilitation is on ly a small share of total Aid for Trade, support for 
trade facilitation has increased significantly betw een 2005 and 2010 growing at  a faster rate than 
overall Aid for Trade. While LDCs are the biggest  beneficiaries of Aid for trade facilitation, 
increases in support were highest for UMICs and SVEs. 
6.5.  In terms of trade performance, goods' and services' exports increased by 66% and 69% 
respectively, for the 80 countries between 2005-2010. Goods' exports increased the most for 
LDCs, LLDCs and LMICs with 98%, 102% and 83%, respectively. South-South trade is proving an important driver for market diversification. In particular, China and India have leaped into the top 
five export and import markets between 2005 and 2010 for an increasing number of developing 
countries. 
6.6.  High export growth in LDCs and LLDCs can be attributed to rising commodity prices during 
2005 and 2010. This was further highlighted throug h the positive relationship between growth in WT/COMTD/AFT/W/48 
 
- 24 - 
 
  merchandise exports and export product concentrat ion. Results show that the export baskets of 
LDCs and LLDCs were becoming more concentrated towards a few products, in particular fuels and mining. Since FDI is concentrated in extractive sectors, Aid for Trade can play an important role in helping diversify LDC exports.  
6.7.  Developing countries experienced positive development as captured by the indicators GDP 
per capita and human development index. In part icular, GDP per capita increased the most for 
poor countries, i.e. on average by 27% for LDCs  and 30% for LLDCs, as compared to the sample 
average of 23%. Furthermore, all LDCs in the sample improved their HDI score between 2005 and 
2010. 
6.8.  The assessment of the fact sheets from a re sults chain perspective at the macro level places 
Aid for Trade in a broader development context. It highlights the positive relationship between 
development finance and trade performance, as well as between trade performance and 
development impacts. In particular, relying on the data from the fact sheets, financial inflows, including Aid for Trade, are positively correlate d with export growth, while export growth is 
positively correlated with GDP per capita growth . These findings are not new but rather confirm 
existing empirical studies. 
6.9.  Of course, correlations are not causations  and individual countries deviate from average 
correlation patterns. At this point, the analysis of the individual fact sheets proves useful for 
policymakers. The strength of the individual fact sheets is actually to benchmark countries against aggregate trends. Furthermore, the fact sheets help identify instances where a country deviates from the expected positive relationships between Aid for Trade and trade performance as well as 
between trade performance and development impacts. 
6.10.  Lack of data for certain countries and indicators poses a significant challenge for analysis. 
Since sound policymaking relies on well-informed analysis, more efforts to collect and design 
suitable indicators and to assist developing countries in their data collection are needed. 
6.11.  The refinement of the methodology of the fa ct sheets in terms of time span and indicators 
could take into account current trends and the Aid-for-Trade work programme. For instance, more 
focus and detail could be given to aid for trade fa cilitation both in terms of inputs (i.e. Aid for 
Trade) and outcomes. A further possibility is also to incorporate more information on donors, including on South-South assistance providers.  WT/COMTD/AFT/W/48 
 
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  7  REFERENCES 
Busse, M., Hoekstra, R., and Königer, J. (2012), "The impact of aid for trade facilitation on the 
costs of trading", Kyklos , 65(2): 143-163. 
 
Calì, M. and D.W. te Velde (2011), "Does Aid for Trade Really Improve Trade Performance?," 
World Development , 39(5): 725-740. 
 
Escaith, H. and B. Tamenu (2013), "Least-Developed Countries' Trade During the "Super-Cycle" 
and the Great Trade Collapse: Patterns and Stylized Facts", WTO Staff Working Paper ERSD-2013-12.  
Helble, M., C. Mann and J. Wilson (2012), "Aid-for-trade facilitation", Review of World Economics , 
148(2): 357-376.  
Cirera X. (2013), The Economic Engagement Footprint of Rising Powers in Sub-Sharan Africa: An 
Analysis of Trade, Foreign Direct Investment and Aid Flows, Evidence Report No. 43, Institute of 
Development Studies. 
 
WTO (2008), World Trade Report 2008: Trade in A Globalizing World , Geneva: WTO. 
 OECD-WTO (2013a), Aid for Trade at a Glance 2013: Connecting to Value Chains , OECD 
Publications, Paris. Available at: http://www.wto.org/english/res _e/booksp_e/aid4 trade13_e.pdf  
 
OECD-WTO (2013b), Aid for Trade in Action, OECD Publications, Paris. Available at: 
http://www.wto.org/english/res_e/booksp_e/aid4tradeinaction13_e.pdf  
 
OECD, DAC List of ODA Recipients: Effective for reporting on 2012 and 2013 flows . Available at: 
http://www.oecd.org/dac/stats/49483614.pdf  
 
  WT/COMTD/AFT/W/48 
 
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 ANNEX I - 80 DEVELOPING COUNTRIES USED FOR THE ANALYSIS ACCORDING TO INCOME 
GROUPS 
The scope of the analysis is limited to developing countries under the following categories which 
participated in the monitoring exercise of the 2013 4th Global Review on Aid for Trade.  
 
Least Developed Countries (LDCs), Lower Mi ddle Income Countries (LMICs) and Upper 
Middle Income Countries (UMICs) 
 
The DAC List of ODA Recipients1  shows the countries and territories eligible to receive official 
development assistance (ODA). These consist of all low- and middle-income countries based on 
gross national income (GNI) per capita as publis hed by the World Bank, with the exception of G8 
members, European Union (EU) members and countries with a firm accession date for entry into 
the EU. The list also includes all of the Least Developed Countries (LDCs) as defined by the United Nations (UN).  
 
LDCs: The identification of LDCs is currently based on three criteria.  
 
1)  Low-income criterion, based on a three-year average estimate of GNI per capita, based on 
the World Bank Atlas method (under $992 for inclusion, above $ 1,190 for graduation as applied in the 2012 triennial review).   
2) Human Assets Index (HAI) based on indicators  of: (a) nutrition: percentage of population 
undernourished; (b) health: mortality rate for childr en aged five years or under; (c) education: the 
gross secondary school enrolment ratio; and (d) adult literacy rate. 
 
3) Economic Vulnerability Index (EVI) based on indicators of: (a) population size; (b) remoteness; (c) merchandise export concentration; (d) share of agriculture, forestry and fisheries 
in gross domestic product; (e) share of population living in low elevated coastal zones; (f) 
instability of exports of goods and services; (g) victims of natural disasters; and (h) instability of agricultural production.  
LMICs : Countries with per capita GNI between US$1,006 – US$3,975 in 2010 
 UMICs : Countries with per capita GNI between US$3,975 – US$12,275. The list shall also include 
Trinidad and Tobago 
  
Small and Vulnerable Economies (SVEs) 
 The list of SVEs is taken from the criteria of "small economies" as per the text in the Doha Round's Revised Draft Modalities for Agriculture. It describes a small economy as one whose average share 
for the period 1999-2004 (a) of world merchandise trade does not exceed 0.16% and; (b) of world 
NAMA trade does not exceed 0.10% and; (c) of world agricultural trade does not exceed 0.40%. 
While Annex I of the Agriculture Draft Modalities text lists 45 countries as meeting the above 
criteria, some 15 of the listed countries do not readily identify themselves as small economies and 
have not expressed an interest in the on-going Work Programme on Small Economies, established 
as part of the Doha Round in November 2001. 
                                               
1 OECD, DAC List of ODA Recipients: Effective for reporting on 2012 and 2013 flows. WT/COMTD/AFT/W/48 
 
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Landlocked Developing Countries (LLDCs)  Countries that lack territorial access to the sea. 
 
Table 2 - Countries and country groupings used in the analysis 
LDCs  LMICs UMICs SVEs  LLDCs 
Afghanistan Belize Antigua and Barbuda Antigua and Barbuda Afghanistan 
Bangladesh Cabo Verde Botswana Barbados Bhutan 
Benin Congo, 
Rep.of Colombia Belize Botswana 
Bhutan Côte 
d'Ivoire Costa Rica Cabo Verde Burkina Faso 
Burkina Faso El Salvador Dominica Dominica Burundi 
Burundi Fiji Dominican Republic Dominican Republic Central African 
Republic 
Cambodia Ghana Gabon El Salvador Ethiopia 
Central African 
Republic Guatemala Greneda Fiji Lesotho 
Chad Honduras Jamaica Grenada Malawi 
Comoros India Jordan Guatemala Mali 
Dem. Rep. of 
Congo Indonesia Mauritius Honduras Nepal 
Djibouti Morocco Mexico Jamaica Niger 
Ethiopia Nicaragua Panama Mauritius Paraguay 
The Gambia Nigeria Peru Nicaragua Rwanda 
Guinea Pakistan Saint Kitts and Nevis Papua New Guinea Uganda 
Haiti Papua New 
Guinea Saint Lucia Paraguay Zambia 
Lesotho Paraguay Saint Vincent and the 
Grenadines Saint Kitts and Nevis Zimbabwe 
Liberia   Suriname Saint Lucia   
Madagascar   Trinidad and Tobago Saint Vincent and the 
Grenadines   
Malawi   Tunisia Suriname   
Mali   Turkey Trinidad and Tobago   
Mauritania   Uruguay Tuvalu   
Mozambique     Vanuatu   
Nepal         
Niger         
Rwanda         
Samoa         
Senegal         
Sudan         
Tanzania         
Togo         
Tuvalu         
Uganda          
Vanuatu         
Yemen         
Zambia         
 WT/COMTD/AFT/W/48 
 
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  ANNEX II – CHOICE OF INDICATORS  
The choice of indicators has been influenced by the availability of time series data. New indicators 
are appearing which may in some cases be more fitti ng for the purposes of this analysis. However, 
an absence of historical data and geographic coverage means that they are not ripe for inclusion. 
As such, the indicators in the fact sheets will be updated and refined in future editions.  
 A. Investment and financing (inputs) 
 
The inputs section covers investment and financing flows in the economy that form the basis for economic growth and development. Indicators incl ude gross fixed capital formation (overall, public 
and private) capturing investment into fixed capi tal, and external financing inflows capturing the 
reliance of capital investment on financing from abroad. External financing indicators used are 
foreign direct investment (FDI) inflows, long-ter m external debt and IMF disbursements, disbursed 
trade-related non-concessional flows, disbursed Aid-for-Trade flows (overall, by sector and by 
donor), and remittances and compensation of empl oyees by migrants and non-resident workers. 
External financing inflows can be used to finance capital investment and also serve purposes such 
as private and public consumption.  
 
The comparison of disbursed Aid-for-Trade flows with other external financial inputs illustrates the relative importance of Aid for Trade for investment and the local economy. Furthermore, the presentation of Aid-for-Trade flows by sector and by donor provides a more nuanced view on 
Aid-for-Trade development for the period 2005-2010. 
 Sources and variables:  
OECD, DAC-CRS Aid Activities Database: Aid-for-Tr ade flows disbursed (overall, by sector and by 
donor), trade-related non-concessional flows disbur sed, i.e. "Other Official Flows" that are not 
considered as official aid either  because they are not primarily aimed at development or because 
they have a grant element of less than 25%. 
World Bank, World Development Indicators: Gross fixed capital formation (overall, public and 
private), FDI inflows, remittances and compensation of employees. World Bank, International Debt Statistics: Long-term external debt and IMF disbursements. 
 
B. Trade performance (outputs)  
In the results chain, inputs and accompanying acti vities result in outputs. The trade performance 
section covers trade performance indicators that provide a reflection of inputs, policies and economic developments. The primary focus of this analysis will be on trade values for 2005 and 
2010. Respective changes are shown for exports and imports of goods and commercial services. 
Finally, to provide a dynamic view on the export structure of countries, the top five markets and 
products for merchandise exports and imports are presented for 2005 and 2010 (or other years depending on data availability).  
 
Sources and variables:  WTO Secretariat: Goods and commercial services export and imports, top five markets for exports 
(imports), top five export (import) products. 
 C. Trade indicators (outcomes) 
The outcomes section covers mostly trade performance indicators. Indicators include: The 
Hirschman-Herfindahl index of export concentration shows to what extent the country is concentrated or diversified in terms of exported products with scores closer to zero indicating a more diversified export portfolio and scores nearer to one indicating high concentration on a few 
products.  
 Sources and variables:  
UN Comtrade: Hirschman-Herfindahl index of product export concentration ranging from close to 
zero (perfectly diversified export portfolio) to one (the country exports only one product).  
D. Development indicators (impacts) 
The impacts section covers indicators that describe long-term objectives of economic development which Aid for Trade aims to achieve. GDP per capita in current international US$ capture the country's overall economic development over ti me. The Human Development Index ranges from WT/COMTD/AFT/W/48 
 
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  zero (minimum level of development) to one (maximum level of development) summarising the 
three basic development dimensions health, education and living standard.   Sources and variables:  
United Nations Development Programme (UNDP), International Human Development Indicators: 
Human Development Index (from 0=minimum leve l of development to 1=maximum level of 
development). 
World Bank, World Development Indicators: GDP per capita (based on purchasing power parity, 
PPP, in current international US$).     
 
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