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International Partnerships
News announcement20 January 2023BrusselsDirectorate-General for International Partnerships

Aid for Trade: EU remains among the major global providers with €23 billion

Women working in a field
European Union

In 2020, coinciding with the beginning of the pandemic, which had a dramatic impact on trade, the EU and its Member States collectively invested €23 billion in Aid for Trade. A wide variety of EU Aid for Trade programmes have been put in place to assist partner countries in facing the recovery from the COVID-19.

“Trade is a powerful tool to generate economic growth and reduce inequalities. Aid for Trade has proved efficient to help recovery from the many shocks in partner countries. Through Global Gateway, the European Union boosts smart, clean and secure links and connections with and between its partners. Our Aid for Trade is crucial in this effort”, said Commissioner Jutta Urpilainen.

EU collective Aid for Trade reached its highest levelin 2020.The 2022 progress Report confirms the EU and its Member States as one of the main world's leading Aid for Trade providers, with €23 billion invested in 2020, a growing figure compared to the €17.9 billion of 2019. It represents 47 % of all Aid for Trade from bilateral and multilateral sources. The main part of the EU collective Aid for Trade goes to Africa, followed by Asia. Between 2011 and 2020, EU Aid for Trade increased by 60%, namely from € €14 to €23 billion.

The data have been revealed by the EU Aid for Trade Progress Report for 2022, just published. The Aid for Trade encourages increased investment in EU partner countries by supporting trade-related projects. This year’ report focuses on how the EU’s aid for Trade fostered a green recovery and supporting sustainable and resilient food systems. EU Aid for Trade contributes to Global Gateway, the EU’s strategy to boost sustainable connections across the world.

In June 2022, 123 partner countries and territories were eligible for EU ODA and had preferential access to the EU market: 62 of them through a preferential trade agreement in force, 61 through one of the three unilateral EU preferential trade schemes under the Generalised Scheme of Preferences - GSP (Standard GSP, Everything But Arms, GSP+). EU preferential trade agreements and schemes are among the major drivers of the EU’s relationship with its partner countries, complementing and reinforcing the resources coming from the traditional Official Development Assistance (ODA).

The EU’s strategy for Aid for Trade is designed to deliver more relevant aid that makes use of all EU tools, combining ODA with incentives for investment and duty-free market access offered through Free Trade Agreements and Preferential Schemes.

The EU intends to continue to increase the share of EU Aid for Trade allocated to its partner countries to help them double their share of global exports by 2020- 2025,

 

Background

The EU's Aid for Trade strategy was adopted in 2007 in response to the Aid for Trade initiative the World Trade Organization (WTO) launched in 2005. It encourages developing countries to recognise the role trade can play in their sustainable development. The EU's Aid for Trade strategy helps partner countries better integrate into the global trading system and take greater advantage of the poverty-reducing benefits of economic openness and enhanced trade efficiency. The EU's Aid for Trade strategy was revised in 2017 to follow a broader approach, in line with the UN's 2030 Agenda for Sustainable Development. It considers the interlinkages that exist between investment and trade, which need to be fully exploited to achieve the Sustainable Development Goals.

The EU Aid for Trade Progress Report illustrates the EU's contribution to the global Aid for Trade global initiative and an overview of the implementation of the EU's Aid for Trade Strategy. The qualitative analysis is based on the responses to a questionnaire completed by 92 countries worldwide in 2022. The quantitative analysis takes into account the OECD/DAC data on Aid for Trade volumes in 2020, the last year for which full data are available.

The Commission had committed to dedicate €240 million for trade facilitation during the Multiannual Financial Framework (MFF) 2014-20. The cumulative value from 2014-2019 was €423.7 million, by far exceeding the commitment at the WTO when the Trade Facilitation Agreement was signed.

 

For More Information:

EU Aid for Trade Progress Report 2022

 

 

 

 

 

 

 

 

Details

Publication date
20 January 2023
Author
Directorate-General for International Partnerships
Location
Brussels