WORLD TRADE WT/LDC/HL/4
13October 1997
ORGANIZATION(97-4381)
Original: English High-Level Meeting onIntegrated Initiatives for
Least-Developed Countries 'Trade Development
THEMATIC ROUND TABLE: THEME A
BUILDING THE "CAPACITY TOTRADE" INLEAST-DEVELOPED COUNTRIES
Note Prepared bytheUNCTAD andITCSecretariats
I. Theroleoftrade support services (Strengthening trade support services inLDCs andtrade-
related infrastructural needs ofLDCs): issues andapproaches
II. Human andinstitutional capacity building inLDCs
III. RecommendationsWT/LDC/HL/4
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INTRODUCTION
1. "Building thecapacity totrade inLeast Developed Countries (LDCs)" isoneoftwothemes
tobeconsidered byThematic Round Table Meetings inthecontext oftheHigh-Level Meeting onthe
Integrated Initiatives forLDCs Trade Development.
2. ThesuccessofanLDC’sresponsetotheopportunitiesandcompetitivechallengesofglobalization
andliberalization depends toaconsiderable extent onpolicy reforms which seektocreate anenabling
environment forinvestment aswellasonenhanced human andinstitutional capacity, improved and
efficient trade-related infrastructure andstrengthened tradesupport services. Thelatterthreeconstitute
anessential component ofanyintegrated trade development strategy forLDCs.
3. Thispaper hasbeenprepared tofacilitate discussions ontheseclosely interrelated issues which
arecritical forbuilding thecapacity totrade inLDCs. PartIoftheReport addresses theissues of
tradesupport services andtrade-related infrastructural needs ofLDCs. PartIIdealswithissues relating
tohuman andinstitutional capacity-building inLDCs. PartIIIcontains recommendations andactions
tobeundertaken toimprove andstrengthen trade support services andenhance trade-related human
andinstitutional capacities inLDCs.
I. THE ROLE OFTRADE SUPPORT SERVICES (STRENGTHENING TRADE SUPPORT
SERVICES INLDCS AND TRADE RELATED INFRASTRUCTURAL NEEDS OFLDCS):
ISSUES AND APPROACHES
4. Trade support services aremajor instruments topromote andfacilitate theparticipation ofsmall
andmedium sizedenterprises (SMEs) ininternational trade. Theyaimatenhancing thecompetitiveness
ofenterprises intheglobal market andassist them intaking advantage ofmarket opportunities.
Strengthening tradesupport services inLDCs andtrade-related infrastructural needs ofLDCs areclosely
interrelated ascaneasily beseenwhen looking atthetransport, customs ortelecommunications sectors.
Efficienttransportnotonlyrequiresgoodroad,rail,airandseainfrastructurebutalsocompetentservices
tomanage andmonitor theexisting facilities. Ifcustoms wants tobecome atruetradesupport service,
itneeds toreform itsoperations inmany countries. Inmostcases thiswould alsorequire animportant
upgrade oftheinfrastructure. Likewise thetelecommunications sector combines services and
infrastructure. Forthatreason these topics aredealtwithtogether andrelated issues arereviewed by
thesector. Thequestion ofinfrastructure andfacilitating private involvement therein wasaddressed
inanoteprepared bytheWorld BankGroup stafffortherecent meetings oftheDevelopment Committee
heldinHong Kong inSeptember 1997. Thatdocument, together withtherecommendations ofthe
DevelopmentCommitteecontainedinitsCommuniqueofSeptember22,1997,arecirculatedindocument
WT/LDC/HL/8.
5. Whether established asapermanent in-house facility oraccessed from national institutions,
business firms require awidearray ofspecialized services. Theeaseofaccess, relevance, quality,
costandtimeliness ofthese services largely determine theincentives forenterprises toentertheglobal
market andexpand itsbusiness.
6. Inorder tomeet these crucial andevolving needs arange oftrade support services have
developed overtheyears. These include: trade efficiency andtrade points, transport, customs, trade
financeandinsurance,businessinformation,telecommunications,marketpromotion,productadaptation,
international purchasing andsupply management, export quality management andexport packing.
Some other services include product costing andpricing, participation intrade fairsandexhibitions,
official trade representation service, andtrade facilitation. Institutional support measures topromoteWT/LDC/HL/4
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trade inservices willalsolikely become important forseveral LDCs. Theabove listoftrade support
services isofcourse notexhaustive.
7. Generally speaking, trade support services areoffered intheform ofinformation, advice,
guidance, training andtechnical documentation. Theservices areexpensive toestablish andmaintain,
requiring constant research, analysis anddissemination byskilled professional experts familiar with
practical business problems andneeds. Themajor questions toconsider arethebusiness demand,
costeffectiveness andsustainability.
8. Because mostenterprises inLDCs cannot afford toestablish andmaintain in-house expertise
insuchspecialized areas andtaking intoaccount theneedtoachieve economies ofscale, thetrade
support services aregenerally organized intrade-related service institutions, whether inpublic, private
ormixed sectors. Consequently, themandate, structure, resources andfunctions ofthese institutions
arecritical factors inthequality andvalue oftheservice provided. Insome cases, consideration should
begiven toastrengthening ofregional institutions ifindividual LDCs cannot themselves establish such
institutions.
9. Institutions providing tradesupporting services include theMinistry ofTrade, tradepromotion
organizations, telecommunication system, central andcommercial banks, export credit guarantee and
insurance agencies, national standards institutions, packaging development bodies, management training
institutions, institutes ofpurchase management, chambers ofcommerce, customs andportorganizations,
exporters/importers associations andprivate sector business consultancy firms. Some regional
institutions/facilities arealsoproviding tradesupport services, especially intheareaoftradefinancing.
A. Trade efficiency andtrade point programme
10. Trade efficiency responds totheurgent needtoincrease theinternational awareness andeffective
application ofinformation technologies totradeandtopromote measures capable ofreducing procedural
costs ininternational Trade. TheUnited Nations Symposium onTrade Efficiency (UNISTE), held
inColumbus, Ohio (USA) inOctober 1994, adopted aMinisterial Declaration, andproposed aset
ofpractical recommendations toGovernments andtrade operators forimmediate action insixtrade
related areas: Transport, Customs, Banking andInsurance, Business information fortrade,
Telecommunications, andBusiness Practices. TheTrade Point Programme isthecorecomponent of
theintegrated approach totheTrade Efficiency Initiative. Itallows enterprises tofindtrading partners
worldwide, andtobenefit from acommercial presence ontheInternet. Theprogramme offers an
electronic commerce "theIncubator service", which assists Trade Points tocreate homepages with
information ontheircountry ingeneral, companies, market, lawsandregulations, etc.;theElectronic
Trading Opportunity system (ETO 's)where enterprises caneasily andreadily submit theiroffers and
demandsforgoods,investmentandservicestotheirtradingpartners.ThenewUnitedNationsElectronic
DataInterchange forAdministrative, Commerce andTransport (UNEDIFACT) compatible standards
forthedissemination ofETO'sisbeing implemented. Regional servers havebeensetupinmany
countries tofacilitate access tothenetwork. Thelatest phase oftheelectronic commerce viatheGlobal
Trade Point Network (GTPNet), istheintroduction ofsecure electronic transactions which willfurther
facilitate thetrade.
B. Transport andCommunications
11. Amajorstructuralcharacteristicsoftheleastdevelopedcountriesistheexceedinglyweakphysical
infrastructure. Thepoorcountry-wide network oftransport andcommunications linkages havebeen
animportant factor inlimiting theestablishment ofvitalcontacts between administrative centres and
theruralsector, where theoverwhelming partofthepopulation andthenatural development potentials
arelocated. Because ofresource limitations mostoftheLDCs areseriously constrained notonlyinWT/LDC/HL/4
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expanding newtransport andcommunications links butalsoinmaintaining existing facilities. This
isparticularly pertinent totheroadsector. Thelackofaccess totransport andtoaneffective
communicationssystemextendsbeyondnaturalbordersothatanyavailableopportunitiesforsubregional
cooperation intrade anddevelopment from which theLDCs could benefit havealsobeenexploited
onlymarginally.
12. Sixteen outof48LDCs arealsoland-locked andfaceadditional transport bottlenecks intheir
international trade. These bottlenecks which arerelated toinstitutional weaknesses, pooradministrative
procedures formoving transit cargo fromportsandacross inter-state borders, lackofaneffective legal
framework togovern transit transport operations andlimited managerial capabilities giverisetohigh
transit costswhich reduce export earnings andincrease import costsincurred bytheland-locked LDCs.
UNCTAD 'swork programme onbehalf ofland-locked countries focuses ontheelaboration ofpolicy
andoperationalmeasurestoremovethesebottlenecks.Recentinitiativesinthisconnectionhaveinvolved
thepromotion ofamore liberalized transit transport regime andtheencouragement ofagreater role
oftheprivatesectorintransittransportoperations.TheUNCTADsupportedAdvanceCargoInformation
Technical Assistance Programme (ACIS) isalsodesigned totracktransport equipment andconsignments
along thetransport chain andthusreduce transit costs.
13. Trade andtransport areinextricably linked withefficient transport services being aprerequisite
forsuccessful trading. Formany oftheleastdeveloping countries, thenecessary physical infrastructure
isoftenlacking orinadequate which when coupled withalimited andpoorly maintained transport fleet
andpoormanagerial skills andtoolsleads toexcessive transport costs, increasing thecostsofimports
andlower thecompetitivity ofnational exports. Onethirdofthe48leastdeveloped countries areland-
locked andthehighfreight costs aremainly duetosubstantial inland transit transport charges.
14. Inaddition tothese infrastructure andequipment limitations, which must besolved witha
programme ofcapital investment, there isaneedtomake better useofexisting facilities through the
removal ofinstitutional bottlenecks, improved operational procedures andupgrading managerial
capabilities ofallthose inthetransport chain. Inthisconnection apriority forLDCs isthedevelopment
ofanational transport plan. Transit transport agreements (designation oftransit routes, border facilities,
liberalization ofroadtransit services, etc.)cangreatly facilitate theflowoftraffic andremove delays
atports andborder crossing. Management andstaffdevelopment programmes arerequired togive
thepublic andprivate sector thenecessary skills tomake bestuseoftheoftenscarce transport resources.
Computer-based systems suchasUNCTAD 'sAdvance Cargo Information System (AICS) canbeused
totracktransport equipment andconsignments along thetransport chain. Suchasystem allows transport
operators toreduce costs andmake efficient useofinvestments intransit facilities.
15. Withregard totelecommunications, thelackofaccess toadequate telecommunications inmany
developing countries especially LDCs isamajor constraint forparticipating ininternational trade and
reducing transactions costs. Inarecently heldExpert Group Meeting onTelecommunications, Business
Facilitation andTrade Efficiency, Geneva, 8-10September 1997, thefinalrecommendations called
upon UNCTAD, inclose collaboration withITU, to"carry outthenecessary analytical andpractical
work toallow interested members tobetter access thevarious possibilities theymayhavetoaccess
trade-supporting services atbetter prices andunder morefavourable conditions: Theparticular situation
ofsmaller firms andunder-equipped areas (especially LDCs) should begiven priority attention." It
wasfurther stressed thatspecial attention should begiven toUNCTAD 'sclose cooperation withthe
ITUs Development Sector, Programme 9,toensure thatelectronic commerce isanintegral partof
itsproject toconstruct community telecenters inruralandremote locations indeveloping countries.WT/LDC/HL/4
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C. Customs
16. Inmany countries, theabsence ofefficient Customs management andprocedures adversely
affects theexpansion oftrade andcauses substantial lossofrevenue. Many Customs administrations
suffer from alackorthetotalabsence oftraining. Thelackofadequate infrastructure tocarry out
efficient andthorough inspection, where required, further aggravates theproblem.
17. Serious efforts areneeded toreform andmodernize theCustoms administrations atalllevels:
improving themanagement culture, introducing aregular andpermanent programme ofstafftraining,
revising andsimplifying theprocedures, implementing internationally agreed standards andintroducing
amodern Customs automation system which includes features forriskanalysis andelectronic commerce.
18. UNCTAD 'sprogramme forcustoms reform andcomputerization (ASYCUDA) hasbeenor
isbeing installed inover70countries inallregions oftheworld. Thesystem usesstateoftheart
information technology.
D. Trade finance andinsurance
19. Pooraccess toadequate andcompetitive tradefinance andinsurance products isamajor obstacle
fortraders indeveloping countries toparticipate ininternational trade. Thisisparticularly aproblem
forsmall- andmedium-size enterprises, especially inleastdeveloped countries where thefinancial sector
infrastructure ispoorly developed. Strengthening thetrade finance andinsurance capabilities inleast
developedcountrieswouldhelptradersinthesecountriestoobtainthefinancialtoolsrequiredtocompete
more effectively inworld markets. Tothisend,anassessment ofefficiency intrade finance and
insurance should beundertaken withaview toidentifying actions required tostrengthen it.These
would include, forinstance, thedevelopment ofexport credit insurance andguarantees andother trade
finance products andservices better adapted totheneeds oftraders inleastdeveloped countries aswell
astotherequirements ofworld markets, aswellasmeasures tostrengthen thenational andregional
institutional setting. Legal andregulatory framework ontrade-related financial services willalsoneed
inmany cases tobeadapted tothedevelopment ofnewproducts andservices, andtothenewworld
trade environment.
20. UNCTAD hasundertaken anumber ofactivities intheabove-mentioned areas. Forinstance,
itisdeveloping amethodology toassess efficiency ofthetrade finance andinsurance sectors; ithas
worked onissues relating toexport credit agencies indeveloping countries; ithascontributed to
strengthening legal andregulatory frameworks inthefieldofinsurance insome countries andhas
provided training courses ontrade finance.
21. ITChascollaborated withalarge number ofdeveloping andleastdeveloped countries in
identifyingtheirexportfinancingproblemsanddesigningandimplementinginnovatingschemesincluding
theestablishment/strengthening ofexport credit guarantee andinsurance organizations. Itsservice
comprises initial design, development ofoperational guidelines andtraining ofagency staffandpotential
SME users. Technical products under development include manuals onHow toapproach banks for
enterprise managers planning toapply forshort termtradefinance andonCredit riskanalysis ofSME
loanapplications forbankofficials.
E. Business information
22. Most LDCs suffer from aserious lackoftechnical expertise, modern equipment, budgetary
resources andinteractive communication channels withthebusiness sector audience. Information on
business trend, market access andopportunity forgrowth, product specifications andconsumer
preferences, prices, potential buyers andsellers, competition, trade channels, trade regulations andWT/LDC/HL/4
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documentations helps theSMEs toweigh various options, prepare business plans, make necessary
investments andimplement effective business strategies. Collection, analysis anddissemination of
up-to-datebusinessinformationdemandahighleveltrainingininformationtechnologyanddataanalysis,
modern equipment, documentation andeffective dissemination.
23. ITChascollaborated withmany developing andleastdeveloped countries inassessing theneeds
andcapacity ofbusiness information services, provided expert advisory service andtrained national
business information specialists. Theservice hasalsoproduced alargenumber oftraining handbooks,
manuals andsources ofinformation.
F. Legal aspects ofinternational trade
24. LDC exporters andimporters, generally unaware oftheinternational trade mechanisms and
legalimplications ofvarious terms andclauses oftradecontracts, frequently riskunsustainable losses.
Inaddition thelackofanappropriate trade related legislation inLDCs presents aserious problem to
theefficient conduct ofinternational trade.
25. Toovercome these problems, LDCs needaccess toinformation, training andexpert advice
forexporters andimporters onhowtonegotiate legally valid contracts, meetthetrade regulations of
partner countries andtoobserve correct procedure forsettling business disputes. ITCprovides services
inthisareaconsisting oflegal information, advice andtraining. Acomprehensive database (Juris)
provides information andlegal textstodeveloping countries through anenquiry/reply service. In
addition, atraining package onexport/import contracts, payments, dispute settlement, insurance and
transport hasbeenpublished andmade widely available foruseinnational training andcapacity building
programmes.
26. Consideration willalsoneedtobegiven tothereview oftheexisting legalframework pertaining
tointernational trade transactions. UNCTAD canassist LDCs insuchexercise byproviding advice
andassistance inupdating/preparing trade related legislation. Inorder toassist importers/exporters
fromdeveloping countries including LDCs toimprove theirtrading capabilities andknowledge asto
therelevant laws, legislation andcommercial practices, UNCTAD secretariat ispreparing ahandbook
onlegalaspects ofvarious components ofinternational trade transactions.
27. Furthermore, inaperiod ofrapid change intrade andbusiness laws, including lawson
multilateraltradingsystemsuchastheUruguayRoundAgreements,LDCsneedtomonitorsuchrelevant
changes intheirtrade partner countries andtakeaction toadjust withthenewlaws. Thesame would
beapplicable inrelation tomodern technological changes which require legislative adaptation and
expertise fortrade efficiency purposes. Therapid development ofElectronic DataInterchange (EDI)
andotherelectronicmeansofcommunicationsisaffectingthewaytradetransactionsarebeingconducted.
LDCs would needtomonitor suchdevelopments, particularly those affecting theirowntrade andthat
oftheirtrading partner countries andmake thenecessary adaptation intheirdomestic laws.
G. Institutional capacity building forsmall andmedium sized enterprises
28. SMEs contribute asmuch as35-45 percentdirectly and60-75 percentindirectly tonational
export earnings ofdeveloping countries. They havealsogenerated thelargest share ofindustrial
employment. However, because oflimited resources andsmall scaleoperation theSMEs faceanumber
ofserious problems, especially inexport marketing inahighly competitive global environment.
29. Under itsInternational Competitiveness Programme, ITCisdeveloping modern business aids
andtoolsthatcanbeadapted tomeettheneeds ofindividual countries. These willhelpdiagnose the
factors inhibiting performance, develop appropriate solutions andprovide learning toolsandsystemsWT/LDC/HL/4
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tointroduce remedial measures. Among thetoolsnowunder development arethe"Export Readiness
andFitnessChecker","CompetitivenessGauge","SupplyChainAnalysisKit","GlobalCompetitiveness
Curricula", andtheguide book onexport trading companies trading onbehalf ofgroups ofsmall
producers. Theprogramme hasalsoembraced work ontheapplication ofinformation technology
forimproving business performance ofSMEs.
H. Market promotion anddevelopment
30. Evidence shows thatmostLDCs exporters areunable toactively develop amarket fortheir
products. Asaresult theyfaceabuyers 'market withextremely small price margin fortheirexports.
Enterprises need tocreate consumer awareness andenhance demand fortheir products through
promotional activities, including buyers/sellers meets, tradefairsandexhibitions, adsandother forms
ofmedia coverage, commercial samples andliterature, etc. FortheSMEs these areexpensive
undertakings andmaynotprove tobecosteffective unless assisted andguided byprofessional expertise
inthenational support institutions.
31. LDCtradepromotion organizations should seektomoreactively promote themarket, especially
forthenon-traditional products. ITCprovides apackage ofassistance inthisareacomprising market
surveys, participation intrade fairsandexhibitions, organizing business delegations, buyers/sellers
meets, preparation ofcommercial publicity materials andrelated promotional campaigns. Theservices
areprovided through studies, information, advice, guidance, hand-on assistance andtraining.
I. Product adaptation/development
32. Forthemanufacturedproducts,marketorienteddesignandadaptationisanessentialpre-condition
forconsumer acceptance. LDCs should acquire acompetitive design capability through asustained
programme oftraining andnetworking, possibly under theaegis ofnational product design and
development institutes. Particular attention needs tobepaidtotherapid progress oftechnology and
changing market preferences.
33. ITCprovides technical information, advice andtraining onproduct adaptation, design and
development. Theservice isbacked byspecialist professionals andaseries oftechnical research
publications, guide books andtraining materials forboththeconcerned national agencies andinterested
small andmedium enterprises.
J. International purchasing andsupply management
34. Most LDC imports arestillprocured fromtraditional, highcostsuppliers, because ofoldand
well-established business relationships andbanking andshipping links. Theexperience ofITC'swork
indeveloping countries suggests thatimproved international purchasing andsupply management can
leadtosavings ofupto25percentinthetotalcostofimported goods andservices. Where imported
inputs constitute asignificant share offinished export products suchsavings would appreciably enhance
theLDC competitiveness.
35. ITCassistance inthisareaaimstodevelop national capacities toprovide training, consultancy
andinformation support ininternational purchasing andsupply management toboththepublic and
private sectors inLDCs. Italsohelps topromote overall reform ofnational public procurement systems.
Itworks alongside concerned public sector bodies, business sector institutions, management training
institutes andpurchasing andsupply management associations. ITC'swork inthisareaissupported
byitsspecialised diagnostic tools, amodular learning system, anditsnumerous other technical and
training materials ininternational purchasing andsupply management.WT/LDC/HL/4
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K. Export quality management
36. Poorproduct quality isperhaps thebiggest barrier tomarket entry anddevelopment. Export
products mustmeetthequality requirements, including health, safety andenvironmental criteria, of
thetarget market. Thisservice analyses thequality management status inexport enterprises andoffers
assistance intheimplementation ofatotalquality management system inaccordance withinternationally
acceptedqualitystandards,throughtheprovisionofinformation,training,testingfacilitiesandoperational
guidelines. LDCs needtoacquire thenecessary expertise, establish laboratories, andsetupasystem
oftraining, testing andcertification.
37. ITCprovides awide range ofservices toenhance thenational capacity inexport quality
management. Acomprehensive database (QUALIDATA) provides information, technical bulletins
andenquiry/reply services toover100developing andleastdeveloped countries forbothnational
institutionsandenterprises.Aseriesofqualitymanagementmanuals,handbooks,guidelinesandtraining
materials, especially focusing ontheadoption ofinternational quality standards, suchasISO9000,
havebeenpublished anddisseminated tothedeveloping countries. ITC'sinformation, advisory and
training services inthisareacould beutilised toupgrade theexport product quality diagnosis and
improvement programmes inLDCs. Theservice hasrecently added another dimension toitswork
byorganizing seminars intheLDCs ontheWTO provisions onthetechnical barriers totrade (TBT)
andsanitary andphyto-sanitary measures (SPS). These seminars areaimed atcreating abetter awareness
oftheimplications ofthese provisions andhelping national institutions andenterprises tomeettheir
obligations andtakeadvantage ofthebenefits oftheagreements.
L. Export packaging
38. Packaging forLDC products isgenerally ofpoorquality interms ofmaterials, design and
presentation.Packingisdesignedtomeettherequirementsofsafety,transportation,storage,preservation
ofproduct quality, environmental considerations andconsumer preferences. Appropriate packaging
material, packaging design andlabelling areakeymarketing toolforexport success. Thisservice
provides therelevant packaging information, training andadvice topackaging manufacturers and
exporters. Alternatively, thenational standard boards mayestablish apackaging development unit.
Whatever theagency, themajor functions should include provision ofinformation andpackaging
requirements inthetarget markets, packaging technologies andpackaging suppliers; material testing,
structure andgraphic design; training ofprofessionals andpackaging counsellors; advisory andguidance
services andtraining courses forenterprise staffresponsible forexport packaging. ITChasastrong
advisory capability andanextensive packaging database inGeneva. Ithaspublished alarge number
ofmanuals, handbooks andtraining material onvarious aspects ofpackaging suitable fordeveloping
andleastdeveloped countries which aremade available aspartofitstechnical cooperation programmes.
II. HUMAN RESOURCE DEVELOPMENT (HRD) AND INSTITUTIONAL CAPACITY
BUILDING INLEAST DEVELOPED COUNTRIES
39. Operating effectively within thepost-Uruguay Round trading environment represents amajor
challengeforthoseengageddirectlyorindirectlyininternationalcommerce.Thechallengeisparticularly
daunting forthe"trade community" inLDCs where commitment tothenewrule-based multilateral
tradingsystemcomesontopofon-goingeconomicliberalizationandpublicsectorreforms,anincreasing
reliance onanuntested private sector totaketheleadineconomic andtrade development andthe
imperatives ofkeeping upwithtechnological developments which simultaneously broaden trading
opportunities, increase competitive pressures andredefine thenorms ofbusiness practice.WT/LDC/HL/4
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40. Thefollowing factors will,inlarge part,determine howLDCs, respond totheopportunities
andcompetitive challenges ofthenewtrading environment:
(a) thelevels ofawareness andcompetency oftradepolicy formulators, entrepreneurs and
enterprise managers andproviders oftrade support andfinancial services;
(b) thedegree towhich these competencies arecomplementary, work inconcert andare
mutually reinforcing; and
(c) theextent towhich national human resource development capacity isabletomaintain
existing competencies andtodevelop thenewcompetencies thatarerequired bythe
rapidly evolving andevermore demanding international marketplace.
41. Inthemajority ofleastdeveloped countries, important weaknesses existinallthreeoftheabove
competencies/capabilities. Inthefaceofheightening competition inbothinternational and,byextension,
domestic markets, these weaknesses willincombination become anincreasingly severe constraint to
enhanced tradeperformance. Implementation ofacomprehensive national programme oftrade-related
human resource development designed tohonecompetitiveness is,therefore, essential.
42. Developing countries andLDCs inparticular arelikely toconfront fourfundamental problems
when endeavouring tointroduce andmaintain aneffective HRD initiative fortheforeign tradesector.
First, competency development needs within thesector arediverse, comparatively specialized andnever
static. Moreover, competency andperformance standards aresetbythemarket -theinternational
market -andaregenerally higher thanthose prevailing indomestic commerce. Second, thecostof
developing competency -based HRD programmes, andmaintaining theirrelevance, ishigh. Third,
thetechnical expertise needed todevelop andmanage abroad-based andcomplex HRD initiative is
inveryshortsupply.Fourth,theabilityandreadinessofparticipantstopayforprofessionaldevelopment
ismost likely tofallshort ofthecosts involved. Anational HRD programme fortheforeign trade
sector willbydefinition facecashflowdifficulties.
43. Together these problems bring intoserious question thetechnical viability andfinancial
sustainability ofany"stand alone" national effort byanLDC toestablish acomprehensive HRD
programme fortheforeign trade sector. They alsounderscore theimportant rolethatinternational
technical cooperation canandmust playtosupport national initiative.
44. Technical cooperation from bilateral andmultilateral sources hasalready made asignificant
contribution totrade-related HRD inanumber ofdeveloping countries. Theachievements are,however,
lessevident inLDCs. Alonger termcommitment tosupporting trade-related HRD inLDCs isessential.
Newapproaches, based onlessons learned, arecalled forwhich viewtrade-related HRD fromastrategic
perspective, which ensure greater co-ordination within thecountry andamong technical assistance
providers, andwhich address onthetechnical viability andsustainability issues.
45. Since thecompletion oftheUruguay Round trade negotiations, UNCTAD, ITCandWTO
havebeenworking bothindividually andjointly todevelop technical cooperation approaches which
areconsistentwiththeabovecriteria.Thisworkhasfollowedtwoparalleltracks:organizingappropriate
technical responses toimmediate HRD needs (i.e.theHRD needs arising directly frombeing asignatory
totheMarrakeshAgreements);anddevelopingprogrammesand"tools"whichaddressthemoregeneral,
longer termHRD needs (i.e.HRD needs resulting from theopportunities andcompetitive pressures
forthenewinternational trading environment).
46. Toaddress theseimmediate needs, ITCincooperation withWTO, launched athreeyearSpecial
Programme ofFollow-up totheUruguay Round. A"Business Guide totheUruguay Round" wasWT/LDC/HL/4
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publishedandtrainingprogrammedesignedandmaterialsdeveloped.Aglobalprogrammeofawareness-
building, andissue identification, seminars forrepresentatives ofthepublic andprivate sectors is
currently infullswing. Concurrently under UNCTAD 'sTRAINFORTRADE Programme atwenty
onemodulestrainingpackageentitled,"TheNewMultilateralTradeFrameworkforInternationalTrade"
isbeing introduced onaregional basis.
47. Anewandcomplementary "Integrated Programme" hasalsobeenprepared anddeveloped
jointly byWTO, UNCTAD andITCwhich targets specifically theimmediate HRD andrelated capacity
development requirements inselected countries inAfrica including anumber ofLDCs.
48. IntandemwiththedevelopmentoftheIntegratedProgramme,ITCandUNCTADhavedesigned
newresponsestothoseHRDneeds(UNCTAD'sTRAINFORTRADEandITC'sGlobalCompetitiveness
Curriculum andTrade Tutor Team-Building Programme), associated withthebroader issues ofraising
thecompetitiveness ofenterprises currently involved intrade, increasing theefficiency oftradesupport
organizations, andbroadening export capacity through promoting theentry ofwellmanaged firms into
theforeign trade sector.
49. Asareflection ofeachorganization 'sparticular mandate, theUNCTAD 'sTRAINFORTRADE
programme concentrates onthepreparation oftraining programme generics which meetthespecialized
HRD requirements oftrade policy formulators andproviders oftransport, insurance andother trade
supportservices.TRAINFORTRADE,andUNCTAD'sTRADEPOINTandTRAINMARProgrammes
havemostrecently become engaged inthepreparation ofelectronic distance learning courses targeting
thespecialized HRD requirements oftrade policy advisers, trade operators andproviders offinance,
insurance,information,transportandothertradesupportservices.ITC'sGlobalCompetitiveCurriculum
complements theseinitiatives withafocus ontheHRD needs oftheentrepreneur andbusiness manager
andproviders ofsuchtrade support services ascommercial representation abroad andquality and
standards. Thetwoorganizations arecommitted toworking together tomake available thecross-section
ofspecialized training programmes needed foracomprehensive trade-related HRD programme.
50. Training oftrainers isthekeyelement ofthecapacity building approach adopted byUNCTAD
andITC. Inthelatter'scase,support isalsoprovided under theTrade Tutor Team-Building Programme
todevelop combined training, applied research, materials development, curriculum management and
business counselling skills. Support toinstitutional capacity development isprovided through direct
andon-going assistance tointroduce suitable research andtraining materials development systems and
todevelop business plans forthepromotion, management andmonitoring oftraining activity.
IV. RECOMMENDATIONS
A. Policy andinstitutional aspects
(i) Trade-related infrastructure andtrade support services should beplanned asintegral
components ofnational tradedevelopment strategies andshould beclosely coordinated
through inter-agency bodies comprising bothpublic andprivate sector institutions;
(ii) Trade support services need tobedesigned, implemented andmonitored inclose
consultationwiththebusinesscommunity.Forthispurposealltradesupportinstitutions
should haveeffective private sector representation intheirpolicy-making, supervisory
andconsultative organs;
(iii) Institutions providing trade-related infrastructure andtrade support services should
receive strong political commitment andadequate budgetary/financial support. Those
concerned withtrade support services should preferably beautonomous andflexible;WT/LDC/HL/4
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staffed byprofessional personnel andhaveaccess toappropriate equipment andstaff
training facilities:
(iv) Thetraditional roles, orientation, priorities andfunctions ofinstitutions concerned with
trade-related infrastructure andtradesupport services should berevisited andbrought
inlinewiththerequirements oftheglobal market;
(v) Multilateral andbilateral agencies providing technical andfinancial assistance should
treattrade-related infrastructure andtrade support services asahighpriority sector
intheirresource allocation plans.
B. Specific service areas
(a) Transport andcommunications
(i) Promote theexpansion ofprimary transport network andcommunications links;
(ii) Develop inter-urban transport andcommunications links;
(iii) Rehabilitateandmaintainexistingnationaltransportandcommunicationsinfrastructure;
(iv) Develop subregional transport links thatwillsupport greater subregional trade;
(v) Develop andimprove transit transport linkslinking theland-locked LDCs withocean
ports;
(vi) Improve institutional administrative andcommercial arrangements forthemovement
oftransit cargo ofland-locked LDCs;
(vii) Promote theliberalization oftransport services andtheinvolvement oftheprivate sector
inthetransport industry;
(viii) Promote theuseinformation technology bysuppliers oftransport services;
(ix) Bilateral andmultilateral agencies should continue togivehighpriority tothetransport
andcommunications sector andgivespecial support totheimprovement oftransit
transport infrastructure andservices.
(x) UNCTAD inclose collaboration withITUshould carry outnecessary analytical and
practical work toenhance better access totrade supply services atbetter prices and
under more favourable conditions;
(xi) Investment, training andprovision ofequipment forLDCs needtobeenhanced.
(b) Customs
(i) Evaluate theperformance oftheCustoms Department withregard toefficiency and
effectiveness -identify causes ofanydeficiencies observed anddevise strategy for
improvement;
(ii) Establish aCustoms training school toimprove theprofessional know-how ofthe
department 'sstaff;
(iii) StrengthenthecooperationwithotherCustomsdepartmentsoftheregionandworld-wide
through exchange ofinformation andstaff.
(c) Trade finance andinsurance
(i) Assess theefficiency ofthetradefinance andinsurance infrastructure ofLDCs inorder
toidentify theneeds ofthesector andtheactions required tostrengthen it;
(ii) IdentifytradefinanceproblemsfacedbySMEswithlimitedassets;designandimplement
schemes suchasexport credit guarantee, export credit insurance, refinance facilities,
revolving funds, export/import banks, export development funds; develop training and
operational manuals andguidelines forbankofficials andenterprise managers;
(iii) Strengthen national andregional institutional setting intheareaoftradefinance, based
onanassessment ofexisting gapsinthissetting;WT/LDC/HL/4
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(iv) Review national regulatory andlegalframework fortraderelated banking andinsurance
toadapt ittothedevelopment ofnewproducts andservices andtoaliberalized
environment;
(v) Develop national technical skills andcompetence intheareaoftrade finance and
insurance through major training efforts.
(d) Business information
(i) Carry outperiodic business needs surveys;
(ii) Equip business information centres withtrained professionals, modern information
technology facilities anddocumentation;
(iii) Ensure easyaccess, timely dissemination andclient feedbacks.
(e) Legal aspects ofinternational trade
(i) Establishappropriatenationalfocalpointstocoordinatesupportactivitiesonlegalaspects
oftrade, including theimplementation oftheprovisions oftheUruguay Round
Agreements;
(ii) Provide incentives toorganize andtrainacorps ofnational legalexperts toadvise and
counsel SMEs asneeded;
(iii) Assess needfordeveloping subregional projects forupdating/harmonizing traderelated
legislation.
(f) Institutional capacity building forsmall andmedium enterprises
(i) DevelopprogrammesandtechniquestokeepthecompetitivenessofSMEsunderconstant
review andadopt co-ordinated measures toenhance it;
(ii) Organize anational network ofconcerned SME trade support institutions inpublic
andprivate sectors. Thenetwork should actasthechannel fortechnical support by
external agencies;
(iii) Considerpromoting,withappropriateincentives,exporttradingcompaniestoundertake
export marketing onbehalf oforinasubcontracting relationship withsmall producers.
(g) Market promotion anddevelopment
(i) Prepare andimplement annual export market promotion programmes forselected
products andmarkets withappropriate follow-up, monitoring andevaluation ofresults;
(ii) Establish product specific exporters ’associations todevelop national capacity.
(h) Product adaptation/development
(i) Establish national product design/development unitandtrainnational professionals
towork oncompetitive product design fortheglobal market.
(i) International purchasing andsupply management
(i) Assess problems andneeds ofprivate andpublic sector importers;
(ii) Design andhelptoimplement reformed public procurement system;
(iii) Planandimplement comprehensive national training, consultancy andinformation
support programmes forprivate andpublic sector importers;
(iv) Help toestablish andstrengthen national purchasing andsupply management
associations.WT/LDC/HL/4
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(j) Export quality management
(i) Assess needs andproblems inexport quality management;
(ii) Establishtestinglaboratories,accreditation,inspection,certificationandtrainingsystems
within anintegrated export quality development plan.
(k) Export packaging
(i) Establish/strengthenanationalpackagingdevelopingcentreequippedwithdesign,testing
andtraining facilities andstaffed bypackaging professionals.
C. Human resource development
(i) LDCs should address HRD intheirnational trade development strategies andensure
thatresources areallocated tobuilding andmaintaining technical competency and
managerial capability within thoseinstitutions responsible forimplementing thenational
HRD initiative;
(ii) Thenational response totrade-related training should bemarket driven. Theprivate
sector should therefore identify fullywithandbecome directly involved indefining
thedirection oftraining;
(iii) Consideration should begiven tobasing thenational approach totrade-related HRD
onaworkingmodelinvolvingnationalnetworksofinstitutionsandindividualspecialists
coordinated byanational "core" institution linked tosubregional andinternational
centres ofexpertise;
(iv) Thecoreinstitution andother organizations providing trade-related training should
combine training withbusiness counselling services withaviewtoreinforcing training
andfacilitating itsapplication. Allorganizations concerned withtrade-related training
should havetrade information collection andanalysis competencies, should engage
in"applied" research ofbusiness andtradedevelopment issues, andshould treattrade-
related training notonlyasapublic service butasabusiness.
(v) Thedelivery oftraining programmes should emphasize participatory andinteractive
learning modes;
(vi) Toensurethatanationalprogrammeoftrade-relatedHRDisnotonlytechnicallyviable,
buteconomically sustainable, technical assistance should:
- target theissues thataremost relevant tothe"clientele" intheLDCs;
- bedesignednotonlytobuildtechnicalandprogramme
management capacities, buttonurture these capacities oncetheyhavebeen
established;
- beprovided atminimum costandbeavailable onanon-going basis; and
- haveabuilt-in mechanism forfeedback appraisal andadaptation;
(vii) TheLDCs should share theirexperiences andorganize jointprogrammes onHRD.
TCDC should beencouraged.