RESTRICTED  WORLD TRADE  
ORGANIZATION  WT/IFSC/M/11 
10 February 2005 
 (05-0547) 
Integrated Framework Steering Committee 
Twelfth Session  
 
 
 
REPORT ON THE 12TH MEETING OF THE 
INTEGRATED FRAMEWORK STEERING COMMITTEE (IFSC) 
 
Thursday, 2 December 2004, WTO, Geneva  
 
Chairperson: H.E. Mr. Henrik Rée Iversen (Denmark) 
 
 1. The Integrated Framework Steering Committee (IFSC) held its twelfth meeting  on Thursday, 
2 December 2004.  
2. The Chairman, on behalf of the Steering Committee, extended a warm welcome to the 
Minister of Trade from Djibouti, H.E. Mr. Saleban Omar Oudine, to the meeting.  In view of the 
presence of the Minister, the Chairman proposed a ch ange in the order of the agenda to allow the 
Minister of Djibouti to speak first.  The Chairman proposed to take up agenda item 2(b) before agenda 
item 2(a). 
3. It was so agreed
.  The adopted agenda is reproduced in Annex I. 
A. S TATUS OF IMPLEMENTATION OF THE IF IN THE COUNTRIES :  REPORTS BY IF BENEFICIARIES  
 4. The representative of Djibouti
, the Minister of Trade H.E. Mr. Saleban Omar Oudine, 
provided a progress report on the implementation of th e IF process in his country.  He reported on 
measures being taken by his government to integrat e trade into development plans and on projects 
being implemented including under Window II.  He said that his country was among those that had 
benefited from assistance under Window II of the IF.  His government, in cooperation with the 
Government of Dubai, was investing more than US$300 million in a project that included a port with 
a new container terminal, a commercial as well as i ndustrial free zone and an oil terminal with a 
capacity of 240,000 tonnes per year.  He further sai d that in the framework of economic reforms, his 
government had taken significant measures to integrate trade into development plans, in particular the 
Poverty Reduction Strategy Paper (PRSP).  He hoped that the launching of the IF Window II 
activities, with the assistance of the Internationa l Trade Centre (ITC), would add value to the 
investments made by them in the area of trade. 
5. The Minister of Djibouti  expressed his hope that his government would be able to overcome 
initial problems encountered in the implementation of  the IF.  He trusted that two Window II projects 
would help achieve twin objectives of building up capac ity in three institutions namely the Ministry of 
Commerce, the National Investment Promotion Agen cy and the Chamber of Commerce as well as of 
promoting tourism.  Those projects, jointly w ith others, would strengthen the Foreign Trade 
Department of his Ministry, enable the Chamber to  provide greater support for the promotion of small 
enterprises, and benefit the National Investment Pr omotion Agency created in 2001 under the direct 
supervision of the President of the Republic.  He  added that the tourism project, which aimed at 
concluding partnership agreements with the tourism promotion agencies of the neighbouring 
countries, would have a significant impact on employme nt.  In conclusion, he thanked donors for their WT/IFSC/M/11 
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 support to Djibouti.  He informed the Committee that an IF donors' meeting w ould be organized in the 
summer of 2005.   
6. The representative of Zambia,
 on behalf of LDCs, welcomed the Minister of Trade from 
Djibouti in the meeting.  He said that the presence of the Minister was a clear manifestation of the 
interest of the Government of Djibouti in the IF as well as in the WTO as a whole.  He was 
encouraged to hear the plans and preparations for strengthening trade not only in Djibouti but for the 
entire region as a whole.  He expressed the suppor t of LDCs to the Government of Djibouti in 
realizing its important objectives. 
7. The Chairman  recalled that the IF Work Programme, adopted in February 2004, placed 
special emphasis on the effective fo llow-up to the Diagnostic Trade Integration Studies (DTIS) in the 
beneficiary countries.  He said that nine countries namely Djibouti, Guinea, Lesotho, Mauritania, 
Madagascar, Mozambique, Nepal, Senegal and Ye men had responded to the questionnaires designed 
by the Secretariat to monitor progress in the IF pr ocess.  The information contained in those replies 
was useful and provided first-hand information on wh at was happening in the field.  He encouraged 
all beneficiaries to provide the Steering Committee with such feedback.  The Chairman invited IF 
beneficiary countries to report on the status of implementation of the IF in their countries. 
8. The representative of Ethiopia  welcomed the Minister of Trade from the Republic of Djibouti 
and said that his country enjoyed strong economic, so cial, cultural and geographical relationships with 
Djibouti.  He gave a detailed account of the current stat e of play of the IF process in his country.  He 
said that a DTIS validation workshop, held in November 2003, came up with 108 recommendations.  
Based on the DTIS and the outcomes of consultations  in November 2003, their Minister of Trade and 
Industry, H.E. Mr. Girma Biru had entrusted the IF/DTIS Technical Committee with the preparation 
of an implementation plan for  trade-relate d technical assistance which had reviewed those 
recommendations and identified 43 priorities out of 108 recommendations.  He noted that the 
Technical Committee had set out an implementa tion schedule for those 43 prioritized DTIS 
recommendations together with the identification of the implementing agency.  He called upon the 
development partners to engage in and initiate financial s upport for the implementation of those 
projects as soon as possible. 
9. The representative of Ethiopia added that hi s country's IF/DTIS Technical Committee had 
identified three broad areas for i mmediate support namely:  (i) institutional support to the Ministry of 
Trade and Industry and the Chamber of Commerce;  (ii) enhancement of trade negotiation capacity 
and the activities, including support for the prepar ation of a "Road Map to WTO negotiations";  
(iii) support for the establishment of an internati onally recognized conformity assessment system to 
enhance trade and competitiveness in terms of quality and performance.  He specified that these three 
components were costed and a project document had been co-signed by the State Minister of Trade 
and Industry, the State Minister of Finan ce and Economic Development and the Resident 
Representative of UNDP with a view to submitting it to the IF Trust Fund for funding out of 
Window II.  He reported that as of November 2004, components one and two had received allocation 
from the IF Trust Fund with component three remain ing unfunded.  In conclusion, he reiterated the 
commitment of his government to the IF process and called upon developmen t partners to redouble 
their efforts to allocate new resources to finance th e implementation of the IF/DTIS priority projects, 
including those submitted to the IF Trus t Fund and were awaiting allocation.   
10. The representative of Madagascar  welcomed the Minister of Trade from Djibouti and made 
an elaborate report on progress being made in the IF process in her country.  She reported on projects 
being prepared and measures being taken by her gov ernment to achieve the objectives set by the IF 
programme, and highlighted a number of factors limiting the smooth operation of the IF in her 
country.  She said that her country was among those that had validated the DTIS.  She added that the IF process in her country had moved forward significantly in spite of certain difficulties and  WT/IFSC/M/11 
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 constraints relating to inter-donor and inter-mini sterial coordination prob lems.  Two Round Table 
workshops had been organized on 15 January and 26 May 2004 respectively, which had made an 
evaluation of the progress achieved in implementi ng the IF.  The meeting held on 26 May had 
established a Steering Committee to monitor implementation of the IF process and of decisions made by the Local Project Approval Committee (LPAC).  Sh e informed that following the Round Table, the 
World Bank had confirmed its availabi lity to consider priority trade sectors that had not been funded 
and had made some recommendations.  Followi ng those recommendations, her government had 
reviewed the priority Action Matrix and reformulated  it in a more focussed way.  Several ministerial 
departments had introduced measures to respond to the needs expressed in the Matrix including 
investment security, promotion of tourism, mode rnization of customs and the establishment of an 
agricultural research fund.  With regard to Windo w II projects, she expressed her concern that a 
project entitled "International Trade Capacity Build ing in Madagascar", validated by the LPAC on 
30 June 2004, was held up at UNDP awaiting defin itive authorization contingent upon the choice of 
an implementing agency.  This had led her government to prepare a draft decree  for the creation of an 
IF implementation unit, which was under examination by the government council.  She said that there 
were a number of factors such as:  (a) rigidity of  the rules and procedures of the Inter-Agency Group;  
(b) the inter-relationship between the IF and othe r cooperation mechanisms;  and (c) the pace of 
implementation of the actions planned under IF, whic h were limiting the efficiency of the IF.  She 
hoped for more flexibility from donors to facilitate quick release of funds.   
11. The representative of Mauritania
 welcomed the Minister from Djibouti.  He gave an account 
of his government's initiatives to contact bilate ral partners to get financial support for the 
implementation of projects and also highlighted e fforts being taken in the area of regulatory and 
institutional reform.  He said that in addition to the IF core agencies, his government had contacted 
multilateral institutions and bilate ral partners seeking funds for the implementation of projects 
identified in the Action Matrix of the DTIS.  He  said that while there had been an expression of 
interest in certain projects, funds had not been fo rthcoming and that funding had been obtained only 
through the IF Trust Fund.  He said that the amount received by his government under Window II 
funding fell short of the total entitlement allocated  to each beneficiary country.  His government 
would soon draft projects to avail of the full entitlement under Window II and hoped that financing 
for those projects would be obtained rapidly.  
12. The representative of Mauritania continued by saying that a number of measures were being 
taken in the area of regulatory reform such as drafting of the implementing regulations for the 
commercial code and the investment code, extension of tax reform, lowering of  the rate of industrial 
and commercial profits tax from 25 to 20 per cent a nd simplification and reduction of the tax on 
wages and salaries.  The Chamber of Commerce, I ndustry and Agriculture had been provided with 
new structures.  Competitiveness and commercial inte gration issues would be the main focus of the 
second PRSP four-year plan 2005-2008.  He concluded by saying that the support of the international 
community and commitment of bilateral partners re mained crucial to the su ccess of the efforts being 
pursued by his government and for the success of the IF.   
13. The representative of Senegal welcomed the Minister of Djibouti in the Steering Committee.  
He said that his government had replied to th e monitoring questionnaire and had sent it to the 
Secretariat.  There had been developments since that report was made.  Following a mission by UNDP on 15 November, a decision had been taken concerning the funding of projects under Window 
II.  He expressed his thanks to the IF partners , although this had come after a long time since his 
government had validated the Action Matrix in De cember 2002.  He hoped that for other projects 
funds would be forthcoming as soon as possible. 
14. The representative of Lesotho
 welcomed the Minister of Djibouti in the Steering Committee.  
She said that her government had tried to ensure gr eater synergies and coordination of IF with other 
trade-related technical assistance projects like the IPR (Investment Policy Review) and that both IF WT/IFSC/M/11 
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 and IPR were aimed at addressing poverty.  She said that recommendations from the IPR and its 
Action Matrix formed part of the DTIS Action Matrix  and the latter also form ed part of the larger 
PRSP Action Matrix.  She made a detailed report on  the status of implementation of both the DTIS 
process and the IPR exercise in her country as those were carried out around the same time and their 
inputs formed part of PRSP for her country.  She said that her country was being assisted by the ITC 
in the implementation of a project entitled "Pro ject and Market Development of Agro-Based 
Products" financed under Window II of the IF.  The project, which was at its implementation phase involved production and marketing of mushrooms and peaches and had five modules:  (i) feasibility 
study;  (ii) production issues;  (iii) training of mush room growers;  (iv) export linkage and training of 
private sector in labelling, packaging, storage, et c.;  and (v) strengthening market linkages between 
the supplier and importer. 
15. The representative of Lesotho
 continued by saying that UNCTAD was helping her 
government with the implementation of most reco mmendations that were suggested in the IPR and 
the DTIS.  The activities undertaken in the area of investment included:  (i) Bilateral Investment 
Treaty;  (ii) Business Linkages;  and (iii) Good Governance in Investment Promotion and Facilitation.  
She further outlined some future activities that were being planned such as drafting a law on Foreign 
Direct Investment, training in investment promotion and investor targeting for the staff of Lesotho National Development Corporation, preparation of a draft Action Plan to improve competitiveness of 
Lesotho's garment industry, study on the potential of  Lesotho's tourism industry, preparation of an 
investment guide and organization of a training  course for trade negotiators to enhance their 
negotiating capacity.   
16. The representative of Nepal
 welcomed the Minister of Djibouti in the meeting.  He made a 
detailed report on the status of the IF process in his country.  He said that the process of integrating  the LDCs' economy into the multilateral trading syst em remained a difficult task, which was severely 
affected by supply-side constraints.  The IF, accord ing to his government, might be instrumental in 
uplifting the economy of LDCs by building supply-side  capacity.  He informed the meeting that the 
DTIS entitled "Nepal Trade and Competitiveness Study (NTCS)" had been  carried out by the World 
Bank in 2003 on behalf of the IF and had been approved by the Government of Nepal in October 
2003.  He said that the policy and technical assistan ce matrix had been developed specifying the time 
frame for implementation.  A High-level IF Steer ing Committee as well as a LPAC had been formed. 
The LPAC had approved projects for a total of US$1  million under Window II to implement various 
recommendations of the NTCS and to strengthen the Secretariat of the national IF Steering 
Committee. 
17. In 2004, his government had submitted a proposal of US$665,000 as a first part under 
Window II of the IF Trust Fund, which had been approved and budgeted by UNDP.  Another project 
proposal of US$335,000 was in the process of approval and aimed at  enhancing  the capacity of the 
private sector.  He said that seven out of nine project proposals had been approved by Nepal's national 
Steering Committee covering 20 items of the DTIS Ac tion Matrix including the establishment of an 
apex trade policy body, rationalization of i nvestment-related institutions and regulations, 
strengthening of service sector institutions, garmen t development and action plan, carpet development 
and action plan, the establishment of a trade promoti on agency and custom reform and modernization.  
He further stated that US$38,000 had been allocated  to implement the project entitled "Strengthening 
National Implementation of the IF" managed for th e IF by UNDP, which was utilized to carry out 
various activities under four headings namely:  (a) national structures training;  (b) Conference;  
(c) Seminars;  and (d) study tour  and knowledge sharing.  He thanked the World Bank as well as the 
lead donor, the Department for International Deve lopment (DFID) for the DTIS and underscored the 
importance of the implementation of identified projec ts.  He said that his government would like to 
strengthen trade-related institutional capacity an d supply-capacity through effective implementation 
of projects identified in the DTIS Action Matrix.  He expressed the commitment of his government to 
mainstream trade into national development strategi es and to foster national ownership.  His country  WT/IFSC/M/11 
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 was expecting substantial support from the intern ational community including IF agencies and donor 
partners in its endeavour towards poverty a lleviation and sustainable development.   
18. The representative of Guinea,  on behalf of her Ambassador, welcomed the Minister of 
Djibouti for his presence at the meeting, which in he r view reflected the commitment of the LDCs to 
the multilateral trading system and to the IF in part icular.  She provided an update of measures being 
taken by her government to implement projects r esulting from the validation workshop and outlined 
some difficulties involved in implementing projects.  She said that as a pilot country in the second 
phase of the IF, her government, with the help of development partners , had endeavoured to 
implement the guidelines for the three projects sel ected for Window II funding during the validation 
workshop held in Conakry in Nove mber 2003.  She expressed the disappointment of her government 
on the delay in the release of funds for one of those three projects, which was due to lack of 
understanding on the role attributed to the IF ag encies namely UNDP, IT C and UNCTAD.  She said 
that at the regional pre-DTIS Workshop, held from 18 to 21 October 2004, in Kigali, Rwanda, the 
representative of Guinea had highlighted the difficulty  encountered in implementing the project;  the 
matter had subsequently been resolved.  She stat ed that her delegation on previous occasions had 
expressed concern with regard to delays in implemen tation of projects with lack of ownership in the 
process, however, the roles of the agencies in the IF process had been clarified and her government 
had begun to implement the third project.  She hoped that in future unclarity concerning the role of 
different agencies would be avoided, which was an impediment to the proper functioning of the IF 
Window II projects.  Finally, she expressed the gratitude of her government to the ITC and UNCTAD for organizing the regional pre-DTIS Workshop held at Kigali.   
19. The representative of Mozambique
 welcomed the Minister of Trade from Djibouti in the 
meeting.  She said that the national validation wo rkshop held in September 2004 had highlighted the 
importance of trade as an engine of economic gr owth and poverty reduction and had discussed 
barriers to the expansion of trade and key actions to be taken by her government.  That workshop, 
chaired by H.E. Mr. Carlos Morgado, Minist er of Industry and Trade, had focussed on 
recommendations contained in the DTIS prepared unde r the IF.  She said that  the main objective of 
the workshop had been to analyze the constraints to trade and to identify necessary reforms that would 
help her country maximize the benefit of trade as  an essential part of the national strategy for 
economic development and poverty reduction.  She said that her government had submitted to the IF 
Secretariat the executive summary, the Action Matrix  as well as the main body of the DTIS.  She 
stated that the Ministry of Industry and Trade w ould present the DTIS and its Action Matrix, to the 
new Cabinet early next year to ensure progress on th e implementation of the DTIS.  She informed the 
meeting that the elections were taking place that very day in her country.  Her government would 
incorporate the national trade strategy into the PRSP.  Her country had achieved a significant 
economic growth through a combination of politic al stability, favourable economic policies, large 
foreign investment flows, and integration into re gional and global markets.  General support from the 
international community had contributed to that impressive growth.  Her country had emerged as a 
model of success of conflict resolution, political tr ansition and economic recovery.  Her government 
was also endeavouring to increase its participation in  international trade, to train more personnel in 
trade-related issues and to strengthen the existing public-private sector dialogue.  She expressed her 
thanks to the core agencies namely ITC, UNDP, UNCTAD, WTO and diplomatic and donor 
communities for their contribution to her country.  In  conclusion, she reiterated the commitment of 
her government to the IF process 
20. The representative of Angola  welcomed the Minister of Trade from Djibouti in the Steering 
Committee.  On behalf of his government, he thanked the six core agencies for accepting Angola in the IF.  He requested the World Bank to provide his authorities with a date for the preliminary  DTIS 
Mission.  His government had contacted the Europe an Communities (EC) in Luanda and hoped for 
their assistance in preparing for the IF exercise at  the national level.  His government remained 
committed to the IF process and to its success.  He  added that his government, with the support of WT/IFSC/M/11 
Page 6  
 
 development partners, would like to realize the twin objectives of integrating trade into national 
development programmes and to build institutiona l capacity.  In conclusion, he said that the 
EMPRETEC programme for building capacity of entrep reneurs, launched in hi s country, would help 
assist Angola to fully integrate into the world trading system. 
21. The representative of Yemen
 welcomed the Minister of Djibouti in the meeting.  He said that 
the first working party meeting on the accession of  his country to the WTO had been held on 
30 November 2004.  Regarding the IF process in Yemen,  he said that the DTIS had been  validated by 
his government after a certain delay.  He had ma de a presentation at the regional pre-DTIS Workshop 
held in Kigali on the status of IF implementation in Yemen, where he had explained the reasons for 
the delay in the validation of the DTIS.  So fa r, his government had submitted three proposals for 
funding out of Window II of the IF Trust Fund to the UNDP and looked forward to their 
implementation.  His government had made  every effo rt to integrate the resu lts of the DTIS and its 
Action Matrix into the PRSP.  He stated that the results of the DTIS would be integrated into the 
updated PRSP for 2006-2010. 
22. The representative of Bangladesh  thanked the Minister of Djibouti for addressing the Steering 
Committee.  He said that it was interesting to h ear the perspectives from countries that had been 
through the IF validation workshop.  He said that the IF was a means to an end and not an end in 
itself.  Results from the IF in terms of increased exports from LDCs that had been through the IF 
process were important.  He underscored the importan ce of an objective evaluation of the question as 
to whether the IF was delivering in terms of in creased exports from LDCs.  He wondered when the 
appropriate stage would be to evaluate that aspect of the IF given that the programme had been in 
existence for some two to three years.  
23. The Chairman  said that the question raised by the representative of Bangladesh was valid and 
important, which needed to be taken up at a later stage.  He added that it was also part of an on-going 
evaluation of IF.  He proposed that the Committee take note of the statements made. 
24. It was so agreed .  
B. 39 TH AND 40TH MEETINGS OF THE IF WORKING GROUP (IFWG):   REPORT BY THE CHAIRMAN 
OF THE IFWG 
 25. The Chairman
 invited the Chairman of the IFWG to  report to the Committee on the outcome 
of the last two IFWG meetings. 
26. The Chairman of the IFWG , Dr. Kipkorir Aly Azad Rana, made a detailed report on the 
IFWG meetings held on 29-30 June and on 22-23 November.  He said that both meetings had made 
good progress on a number of issues, including th e monitoring of progress in on-going DTIS and 
follow-up, preparations of new DTISs, examina tion of Technical Reviews on a number of new 
requests to join the IF, further clarification and operationalization of Window II projects, and 
strengthening of the IF Secretariat.  
27. Regarding progress in on-going DTIS and follow-up, the Chairman of the IFWG, reported 
that 32 countries were at different stages of the IF process, of which 14 LDCs had finalized their 
DTIS.  He said that the IFWG was working on some  practical instruments to improve the country-led 
follow-up process such as by:  (i) establishing a clear roadmap or "aide memoire" at the very 
beginning of the IF process;  (ii) strengthe ning country ownership through the IF national 
implementation project;  (iii) building up awaren ess and knowledge on the IF through workshops such 
as the one organized in October by UNCTAD in Kigali on Pre-DTIS support;  (iv) clarifying the steps 
in the implementation process through a note being finalized by the World Bank;  and (v) ensuring earliest possible involvement of donors through, for ex ample, the identification of an IF facilitator in  WT/IFSC/M/11 
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 each beneficiary.  He also took the opportunity to request the beneficiaries, donors and agencies to 
provide the Secretariat with information regardi ng their responses to the supply-side related needs 
identified in the DTIS Action Matrices by the end of the year.  
28. The Chairman of the IFWG continued by sayi ng that the IFWG had reviewed requests from 
13 LDCs to join the IF and ten LDCs were at diffe rent stages of the DTIS preparation.  On the IF 
Trust Fund, the Chairman underscored two points.  Fi rst, he said that lack of knowledge on project 
formulation and procedures for accessing Window II funds had been identified as one of the major 
constraints in the operationalization of Window II projects and that the IFWG was taking remedial 
action.  Second, he urged the Steering Committee to endorse the agreement arrived at in the IFWG to 
make a small change in the Terms of Reference (TORs) for use of Window II funds, in particular 
regarding the deadline for submission of Window II project s.  He said that the IFWG agreed to extend 
that deadline to one year after actual validation of the DTIS and its Action Matrix.  
29. The Chairman of the IFWG recalled one of the recommendations of the second IF Evaluation 
on the strengthening of the IF Secretariat.  He expressed his sincere appreciation to the donors who 
had positively responded to that urgent need by of fering various options to increase staff in the IF 
Secretariat.  He hoped for a satisfactory arrangeme nt within the next few months.  On cooperation 
between IF and Joint Integrated Technical Assi stance Programme (JITAP), he said that the IF 
Secretariat and the JITAP coordination unit were en suring that existing relevant documents, such as 
DTISs, were usefully taken into account in draw ing up JITAP country documents and vice-versa.  
Steps had also been taken to explore whether n eeds expressed in validated DTIS Action Matrices 
might be addressed through JITAP activities.  On  cooperation with the Standards and Trade 
Development Facility (STDF), which was a recent unde rtaking, he underlined the synergies of these 
two programmes.  He further said that project grants  of the STDF might be used to prepare concrete 
project proposals or to implement any specific proj ect related to standards identified in the DTIS 
Action Matrices.  He also said that a small Task  Force was looking into the desired aims, possible 
modes and expectations for an international c onference on the follow-up and implementation of the 
IF, requested in the Dakar and Kigali Ministerial Declarations of 2004.  He also underlined the 
importance of greater use of the IF website.  Fina lly, he expressed his appreciation for the Regional 
Workshop on Pre-DTIS Support held in Kigali on 18-21 October 2004.  
30. The Chairman  said that a decision was required to revise the TORs for use of Window II 
funds, contained in document WT/IFSC/4, to en large the time frame for submitting requests for 
Window II funding.  He underlined the necessity to raise information on the usage of Window II 
funding.  He also emphasized the need to strengthe n the IF Secretariat soon by exploring different 
avenues. 
31. The representative of Bangladesh  thanked the Chairman of the IFWG for his comprehensive 
report.  He said that the report by the Chairman of the IFWG did not provide details on the issue of 
strengthening the IF Secretariat.  His delegation had certain perspectives which had been expressed in 
the IFWG meetings in the past.  He thought that it would be appropriate if the WTO Secretariat could 
consult the Steering Committee before making any firm arrangements with the donors for staffing 
enhancement.  He underscored the importance of strengthening the IF Secretariat.  
32. The representative of Ethiopia  sought clarification about the deadline for accessing 
Window II funding.  He said that the revision of the deadline for submitting proposals for funding under Window II from one year after the date of the DTIS workshop to one year after the actual DTIS 
validation had been an important improvement.  He , however, raised questions as to those countries 
that could not access full Window II funding within th at deadline.  Illustrating the example of his 
country, he said that one year had already elapsed since their validation workshop held in November 2003.  To date, his country had secu red funding for two components amounting to 
US$750,000.  Allocation had not been made on their request for the third component amounting to WT/IFSC/M/11 
Page 8  
 
 US$300,000.  He put a question as to how those s ituations would be met when requests for full 
funding had been made within the deadline and the full amount had not been released by that 
deadline.  
33. The representative of Djibouti
 expressed his support for the strengthening of the IF 
Secretariat.  He stated that the assessments and evaluations of the difficulties being encountered by 
countries in the IF process, which was discussed in the regional pre-DTIS Workshop held in Kigali, 
should be continued and lessons learnt.  
34. The representative of Guinea  thanked the Chairman of the IFWG for his detailed report.  Her 
delegation adhered to the idea of strengthening the IF  Secretariat.  She said that the partners should 
support that idea as it would strengthen the IF work.  
35. The representative of UNDP  responded to the question raised by the representative of 
Ethiopia on the availability of Window II funding.  He said that the deadline applied to the time of 
submission of proposals, not to the time of alloca tion of funds.  He continued by saying that UNDP 
had tried to ensure equal geographical distribut ion of the funds taking into account the amount 
available in the Trust Fund account.  He said that  there had been constraints in meeting full 
requirements of the countries.  He assured that countries that had approved projects but were waiting 
for allocations would not be affected by the dead line as they had already gone through the process for 
accessing the funds.  He appreciated the positive r esponse from donors with regard to Window II and 
said that UNDP had been able to conclude six new contribution agreemen ts with donors and hoped 
that those projects that had been approved would be  taken up for financing by UNDP by the end of 
the year.   
36. The representative of Nepal  sought further information from the Chair of the IFWG on STDF 
funding for DTIS projects.  He put a question as to whether STDF was independent of the IF Trust Fund, and sought information on its budget and operation.  
37. The representative of the United States
 responded to the remarks made by the representative 
of Bangladesh on the strengthening of the IF Secret ariat, which had been under discussion for the past 
nine months.  She said that the consultation process was on-going with the LDCs to ensure that the 
proposal to be made took on board the views of the LDCs.  She said that it was understood that the idea of secondment of an individual was not acceptable to the Group of LDCs.  She informed the meeting that four donors had been mobilizing res ources to fund some positions and had been working 
out the final details.   
38. The Chairman
 expressed his appreciation for the efforts of the representative of the 
United States on behalf of the donors group.  He said that the IFWG had requested the Steering 
Committee to make a small change in documen t WT/IFSC/4, which contained  the TORs for 
Window II to allow the IF countries better access to Window II funding.  He hoped that there would not be any problem in agreeing to that.  He proposed to take up the issue under the next agenda item dealing with the Trust Fund.  He also proposed that  the IFSC take note of the report by the Chairman 
of the IFWG and of the statements made.   
39. It was so agreed
. 
C. I NTEGRATED FRAMEWORK TRUST FUND:  FINANCIAL STATUS REPORT ;  STATE OF 
FUNDING /TRANSACTIONS ;  IMPLICATIONS FOR FUTURE ACTIONS ;  REPORT BY UNDP 
 40. The Chairman
 said that the UNDP, as Trustee of the IF Trust Fund, had provided tables on 
aggregated and disaggregated figures on pledges, transfers, and approved and allocated IF Trust Fund  WT/IFSC/M/11 
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 resources for Window II projects.  He invited the representative of the UNDP to provide the meeting 
with a status report on the Trust Fund. 
41. The representative of UNDP  expressed his appreciation to the Minister of Trade from 
Djibouti for participating in the meeting.  He then  made an elaborate presentation, using power point, 
on the evolution of the IF Trust Fund, the nature and scope of Windows I and II of the IF Trust Fund, 
the status of DTIS and Window II projects bei ng funded, the Window II implementation challenges 
and funding situation of the IF Trust Fund as of 29  November 2004.  He recalled that the IF Trust 
Fund had been  established in 2000 and was made up  of two Windows.  Window I had been used to 
finance the preparation of DTISs while Window II served as the bridging finance for post-DTIS capacity building.  He informed that the Trust Fund had a total of 16 donors, who pledged and 
transferred funds to an open Trust Fund.  In line with agreed principles for the IF, contributions to 
Window I were non-earmarked.  In contrast, donors might exercise flexibility to earmark funds for 
specific activities or countries under Window II. 
42. The representative of UNDP
 reported that so far resour ces amounting to US$6.9 million had 
been allocated to 23 countries for the preparation of  their DTIS.  He said that a country, once its entry 
into the IF had been approved by the IFWG, was entitled to receive US$300,000 to finance the 
preparation of the DTIS.  That amount might vary in some countries depending on the activities 
needed to be carried out.  For instance, assessment was being made  to identify how much additional 
work was required under the revamped IF methodol ogies for those five LDCs which had benefitted 
from Round Tables under the old IF.  He said that an additional US$5.7 million would be required for 
the 19 countries that were in the pipeline of approva l.  He then made a summary of the status of 
Window II projects by showing the number of the projects that countries submitted, total costs and 
funds allocated for those projects and the status of the operationalization of those projects.  He said that so far most of the DTIS activities had been executed and implemented by specialized agencies 
like the World Bank, ITC and the UNDP.  He said th at countries had started taking charge of the post-
DTIS capacity-building phase and there were a number of  the issues that needed to be looked at for its 
smooth operation. 
43. Regarding challenges posed by Window II im plementation, the representative of UNDP 
recalled that Window II had been established as a qui ck disbursing fund.  He outlined a number of 
reasons for the slow implementation of Window II proj ects.  First, he said at the country level there 
were different interpretations of broad Window II terms of reference, particularly with regard to the 
composition of LPACs and roles of different partne rs.  Second, he referred to the misunderstanding on 
the procedures for accessing Window II funds such as the application of agreed UNDP 
programme/project management guidelines and procedures.   Third, he stated th at there was a lack of 
clarity on project execution/implementation arrangement s, an issue not adequately dealt with by the 
LPAC so far.  Fourth, he referred to the issue of ownership and alternative execution modalities.  
Fifth, he pointed out the limitation of knowledge on project document formulation and development.  
Finally, he referred to the lack of effective mechan isms for coordinating partner efforts.  He stressed 
for more dialogue and effective consultation among the partners at the country level to address those 
challenges.  
44. The representative of UNDP
 added that contributions to both Windows of the IF Trust Fund 
had been impressive.  The pledges had been moving in line with the transfers.  He pointed out that the 
allocation of resources to projects that had been approved was done on the basis of what actually was 
transferred to the IF Trust Fund Account and not on the basis of the pledges.  Regarding the pledges 
and transfer figures, he said that so far US$20 million had been transferred to the IF Trust Fund out of 
a total of US$26.5 million pledged.  Regarding fi nancial transactions, he stated that since the 
beginning of 2004, Window I had a balance of US $4.4 million out of which US$3.2 million had been 
allocated for approved projects, which left Wi ndow I with a surplus of US$1.2 million as of 
29 November 2004.  Window II bega n with a balance of US$7.2 million, after adjusting for two WT/IFSC/M/11 
Page 10  
 
 projects for Cambodia and Mauritania.  So far US $6.3 million had been allocated under Window II, 
which left Window II with a balance of US$900,00 0.  Replying to the question raised by the 
representative of Ethiopia he said that six new co ntribution agreements had been concluded with 
donors.  Those, he said, were likely to bring in  additional funds for Window II and would allow to 
take into account some of the projects which had already been approved but not yet allocated any 
resources.  Overall, the position of the two acc ounts (Windows I and II) gave the IF Trust Fund a 
surplus of US$2.1 million.  He said that under Wi ndow I, seven new countries would be undertaking 
the DTIS exercise, four of which had already been  approved.  This was costed at an estimated 
US$2.1 million.  Twenty-three countries would unde rtake activities under Window II in 2005 which 
would leave an estimated gap of US$16.3 million in  order to meet the requirements under Window II.  
Thus, the total projected funding requirement for 200 5 was estimated at US$18.4 million.  Against the 
current surplus of US$2.1 million, this left a hole of US$16.3 million for 2005.  In conclusion, he highlighted that although UNDP was acting as manager of the Trust Fund and also as the lead agency facilitating Window II activities, the latter was a collabor ative effort of all stakeholders and not a task 
of one agency.  Therefore, partnership between the various players in the IF process, particularly at 
the country level was important.   
45. The Chairman
 said that there were two sets of problems; one related to the procedures for 
accessing funds and the other was to secure sufficient funds.  He said that it was important to address 
both of those at the same time. 
46. The representative of the United States  said that one of the issues being discussed in the 
donors' meeting was the desirability that a letter be  sent by the Chairman of the IFSC requesting 
additional funds from donors for both Windows I and II of the IF Trust Fund.  She requested the 
Chairman to initiate necessar y action in that regard. 
47. The representative of Rwanda  sought detailed figures on the disbursement of funds.  She 
expressed her concern regarding the level of disbursement of funds.  She understood that 
US$20 million had been allocated from a total of US$26 million.  She wondered what amount had 
been paid out to countries out of that allocation of US$20 million.   
48. The representative of th e European Communities  thanked the Minister of Trade from Djibouti 
for his presentation.  He also thanked other countries for their reports on the implementation of the IF process.  It was important to hear from individual  countries to understand how things were working at 
the national level.  He also underlined the point of  strengthening implementation at the central level 
especially in the context of strengthening the IF Secret ariat.  In relation to the IF Trust Fund reporting, 
his delegation acknowledged the improvements made by  the UNDP.  He felt that there was scope for 
further improvements in that report, particularly in  the area of funding, spending and projected needs. 
He thanked the UNDP for the inclusion of funding deficit in the report, which would be useful for 
donors in their future planning. 
49. The representative of the Netherlands
 said that his government had developed an 
implementation method, which was to assist count ries through bilateral channels.  In close 
cooperation with the countries concerned, the embass ies of his country were engaged in evaluating the 
entrepreneurial climate and policy areas which also took into account the DTIS, its Action Matrix and its implementation by donors or other participants .  If the Embassy of the Netherlands in a given 
country considered that there was additional value in  funding certain activities or considered that it 
had a role to play, then recommendations for fu nding were made to The Hague.  This was an 
alternative bilateral approach in addition to  the mu ltilateral funding that had be en set up for the IF at 
UNDP.  He hoped that there would be other simila r types of funding arrangements from other donors 
and that those would be mapped out in the coming period so that donors might get a more comprehensive view and might contribute more in a transparent way on the implementation of the IF.  WT/IFSC/M/11 
 Page 11 
 
 
 50. The representative of the World Bank  clarified that the IFWG had proposed to revise that 
deadline for submission of project proposals for fu nding under Window II of the IF Trust Fund, so 
that countries could apply for funds under Window II after the validation of the DTIS Matrices and the Action Programs.  The IFWG proposed that revisi on, since one of the requirement of the projects 
considered to be funded under Window II was that it ha d to be part of the validated Action Matrices.  
He added that the Action Matrices presented at the national DTIS workshops were usually revised and 
elaborated by governments in light of the outcome of the validation workshops.  Hence, validated Action Matrices were only established at the actual tim e of validation,  and not at the preceding DTIS 
Validation Workshops.  Therefore, he said that it w as only logical to count the deadline from  the date 
of the actual validation of the Action Matrix.   
51. The representative of UNDP
 replied to the questions posed to him.  Responding to the 
representative of Rwanda, he said that his presen tation did not make the detailed break down of 
financial transactions.  However, the reports that ha d been distributed at the meeting contained figures 
that showed cumulative expenditures being reported on those projects.  He said another important 
element of reporting was the certified and audited finances on projects which was being done in close 
cooperation with the executing agencies.  He said that while the UNDP manages the IF Trust Fund, 
the actual activities of implementation was done by other partners.  He illustrated that for the 
preparation of the DTIS, the World Bank was the lead  agency and reported to the UNDP.  He stated 
that, to date, reporting was being made annually due  to work pressure;  but semi-annual reporting was 
being considered.  He underlined the importan ce of certified financial statements from executing 
agencies, which was being reflected in the annual report.  He said that for country execution under 
Window II, the onus and responsibility would be on th e host countries to report regularly - not only on 
the technical issues of the project but also on the financial issue.  This reporting might be done in close collaboration with the UNDP country offices that  usually facilitate allocation of IF resources.  
He said that there were different modalities for tr ansferring funds to implementing agencies.  The UN 
specialized agencies, once they receive authorizati on to spend project funds, use their own funds and 
later apply for reimbursement from the UNDP.  The other option was to make advances based on the 
costed work plans with clearly defined fina ncing requirements for a period and then have 
advancements made by the UNDP.  The last moda lity involved the government authorizing  and 
making the decisions to spend;  under this moda lity, the transaction process was facilitated by the 
UNDP.  He said that all those modalities would be ab le to give an account of  expenditures involved in 
a given project.  
52. The Chairman
 said that he would reflect on the question of more funding to bridge the 
funding gap.  He said that he would approach don ors in order to get more funds for the IF Trust 
Fund.1  On a procedural aspect, he hoped that UNDP would speed up the process of disbursing money 
to the beneficiaries, taking into account the difficu lties shared by countries at the meeting.  He also 
appreciated the work carried out in the IFWG on cl arifying steps and procedures in that regard.  He 
placed his confidence on the professionalism and good offices of the UNDP.  He then took up the 
issue of time frame for accessing Window II funding.   He proposed that applications for funding 
under Window II should be made within one year of the date of the actual validation by the 
government of the DTIS and its Action Matrix.  He proposed to approve this proposal ad referendum, 
subject to a no-objection to the Secretariat by 10 December 2004.2   
53. It was so agreed.  
                                                      
1 A letter was subsequently sent to all potential donors, signed both by the Chair of the IFSC and the 
Chair of the IFWG.  
2 Document WT/IFSC/4/Rev.1, containing the agreed revision, was subsequently issued on 
16 December 2004. WT/IFSC/M/11 
Page 12  
 
 D. R
EPORT ON UNCTAD/UNDP  REGIONAL WORKSHOP ON PRE-DTIS  ACTIVITIES , KIGALI , 
18 TO 21 OCTOBER 2004 
 54. The Chairman
 invited the representative of Rw anda to provide a report on the 
UNCTAD/UNDP Regional Workshop on pre-DTIS activities held in Kigali from 18 to 
21 October 2004. 
55. The representative of Rwanda  welcomed the Minister of Djibouti to the Steering Committee.  
She then provided a detailed account of the Re gional Workshop held in Kigali from 18 to 
21 October 2004.  She outlined the objectives, discussions held, and outcome of the Workshop, 
reported on presentations of country case studies and called for collective commitment of all IF 
stakeholders to ensure effectiv e follow-up to the Workshop.  She said that the need for pre-DTIS 
support for LDCs joining the IF had become evident from the pilot phase of the revamped IF as there 
were serious impediments to country ownership si nce there had been widespread unawareness of the 
IF in the pilot countries at the time of its launch and during the subsequent IF process.  That had 
affected follow-up and implementation of the reco mmendations for trade-related technical assistance 
emerging from the DTIS.  She said that the underlying objective of the Workshop had been to 
strengthen LDCs' capacity for ownership of the IF  process.  The Workshop had provided a forum for 
sharing of knowledge and experiences between repres entatives of LDCs that had completed the DTIS 
and those embarking on the IF process.  She furt her said that discussions had taken place under four 
major areas:  (i) the IF process;  (ii) trade and pove rty, including mainstreaming of trade into national 
development strategies;  (iii) country cases and na tional implementation;  and (iv) IF capacity 
development and fund raising, includ ing bilateral and multilateral funding. 
56. On the IF process, the representative of Rwanda  said that the Workshop had welcomed the 
initiative of UNCTAD to prepare an IF manual.  Th e Workshop had emphasized that trade integration 
into PRSP should not be perceived as an end in it self but rather a process whose primary objective 
would be to address the structural supply-side constraints faced by the LDCs.  She said that the 
involvement of the government in the preparation of  the DTIS such as drafting of the concept paper, 
drawing up of terms of reference and selection of  national consultants were viewed essential for 
country ownership.  She emphasized the need to st rengthen the capacity of the IF national focal point, 
allowing him/her to play the role in greater  synchronization of donor  and national budgetary 
processes, called for by the Workshop.  On IF Wi ndow II, the Workshop highlighted that the project 
guidelines were complex and disbursement procedur es were slow undermining its effective bridging 
role.  She said that at the Workshop, participan ts had called upon the UNDP to accelerate the release 
of funds within 30 days once proj ect approval had been received from the LPAC.  On the discussion 
under the item of trade and poverty, she said that  the Workshop had underlined the importance of 
political commitment in order to mainstream trade in to national development strategies.  She said that 
besides good governance, continuous commitment of  donors, promotion of entrepreneurship and 
active participation of private sector had played  a crucial role in increasing productivity and 
competitiveness in some LDCs.  She said that the na tional development plans needed to include both 
an element on industrial and on trade policy and that every DTIS should be country-specific. 
57. She reported that country case studies had been presented by Guinea, Yemen and Cambodia.  
It was recognized that the IF might be a catalyst for national trade policy dialogue and should be seen 
as a permanent mechanism for creating national commi tment, fostering long-term close relationships 
with donors and identifying strengths, weaknes ses, opportunities and challenges in the trade 
development, in close cooperation with private sector .  It was also highlighted that cultivating donor 
relations was seen as a process that should begin at the earlier stage of the IF process and should not stop once the DTIS was integrated into the PRSP.  On the issue of IF capacity development and fund 
raising, the Workshop had noted that the post-DT IS momentum could be lost due to delays and 
complex procedures for accessing Window II of the IF Trust Fund.  It was recommended that some 
trade and private sector indicators be identified and included in the budgetary support performance  WT/IFSC/M/11 
 Page 13 
 
 
 indicators as a way to raise the profile of trade and promote closer examination of trade and private-
sector development challenges.  Another issue high lighted was the importance of the involvement by 
the IF core agencies, particularly those with a fiel d presence, in order to support the IF focal point to 
raise the profile of trade on the development age nda and to sensitize Ministries such as finance and 
planning to the importance of trade and to ensu re its reflection in the budgetary process.  She 
concluded that the Workshop had been action-oriented and the success of the Kigali Workshop would 
be achieved through a collective commitment to its follow-up and through implementing its 
recommendations.   
58. The Chairman  suggested that the representative of Rw anda circulate her statement, which she 
had to shorten due to time constrai nt.  He said that there were le ssons that might be drawn from the 
recommendations of the Workshop.  
59. The representative of UNCTAD  thanked all the participants which had contributed to the 
success of the Kigali Workshop.  He expressed a special  thanks to the Ambassador of Rwanda to the 
WTO whose active role, besides the partnership spir it that prevailed, had ensured success of the 
Workshop.  He said that the IFWG had encouraged   UNCTAD to proceed and finalize the IF manual 
with inputs from all partners.  He said that UNC TAD intended to make the IF manual available by 
June 2005.  He hoped that all w ould be considering on how to ca rry forward the conclusions and 
recommendations of the Workshop. 
60. The representative of Switzerland,  on behalf of the donors, expr essed thanks to all groups and 
particularly to the Chairmen of the IFSC and IFWG , six agencies and the Secretariat of the IF for the 
work accomplished in the year.  He also hoped to in tensify work to strengthen the IF Secretariat in 
2005.  
61. The Chairman  expressed his thanks to the outgoing donor  coordinators - EC and Canada and 
welcomed the new donor coordinators - the US a nd Switzerland.  He proposed that the Committee 
take note of the statements made.  He suggested that  the next meeting of the IFSC take place after the 
meeting of the IFWG.  The exact da te would be communicated later. 
62. It was so agreed . 
E. O THER BUSINESS  
63. In the absence of  any other business, the meeting was adjourned. 
   
 
 WT/IFSC/M/11 
Page 14  
 
 ANNEX I 
 
The Integrated Framework Steering Committee
 
 
Twelfth Session  
 
Thursday, 2 December 2004 at 3 p.m.  
 
 
1. The Integrated Framework Steering Committe e will hold its Twelfth Session on Thursday, 
2 December 2004, starting at 3 p.m. in the WTO building. 
2. The items proposed for the agenda are:  
(a) Status of implementation of the IF in the countries:  reports by IF beneficiaries.  
Under this agenda item, IF beneficiary countries are encouraged to report on the status of the IF process in their countries; 
The Minister of Trade from Djibouti, H.E. Saleban Omar Oudine will participate in 
the meeting and will make a statement;  The countries which have at this mome nt had a Validation Workshop and are 
therefore encouraged to report are:  Burundi, Cambodia, Djibouti, Ethiopia, 
Guinea, Lesotho, Madagascar, Malawi, Mali, Mauritania, Mozambique, Nepal, 
Senegal and Yemen; 
 
(b) 39
th and 40th meetings of the IF Working Group (IFWG):  report by the Chairman of 
the IFWG;  
(c) Integrated Framework Trust Fund:  Financial Status report;  state of 
funding/transactions;  implications for future actions;  report by UNDP; 
(d) Report on UNCTAD/UNDP Regional Workshop on  pre-DTIS activities, Kigali, 18 to 
21 October 2004.  
 
__________