Trade Policy and Trade Promotion

As the global economy has become ever more integrated, trade in goods and services has strongly increased. Barriers to trade are lowered gradually. This process has created great opportunities for export and growth, including in developing countries. However, the distribution of the benefits of globalisation has not been equitable. Least developed countries (LDCs) in particular have gained little from the increases in trade. Small producers and farmers have remained on the fringes of global economic integration. Hopes for substantial progress in the multilateral trade negotiations of the World Trade Organisation are faltering, and again developing countries are bound to lose most. At the same time it is now widely acknowledged that even greater commitments to trade liberalisation would not automatically translate into larger benefits for all.

Capacity to trade is essential

The GTZ Trade Programme has been established by the Federal German Ministry for Economic Cooepration and Development (BMZ) to support partners worldwide in their efforts to benefit more fully from global trade. It is important that developing countries analyse the implications of trade agreements and exploit their opportunities during negotiations and in the implementation phase of trade agreements. Important domestic reforms of markets and institutions can be triggered by trade but these processes require careful management and sequencing. Most importantly, our partners need to strengthen their capacities to trade: to diversify their exports, to comply with health and quality standards, to move up the value chain and to overcome unnecessary red tape and costs of trading.

Based on good practices we process and disseminate information about innovative tools and topics that shape our overall approach to "Trade for Development".

BMZ has moreover set up in 2002 the Trade Policy and Trade Promotion Fund (also known as the "Monterrey Fund") to specifically target trade promotion and to develop trade-related capacity. The Fund is managed by the GTZ Trade Programme. To date, some 25 trade projects have been set in motion globally.

"Cotton Made in Africa" is a large public-private partnership which aims at increasing the incomes of small-scale cotton farmers in Africa. The approch fosters close cooperation among stakeholders along the cotton value chain.