Programs and Opportunities
Initiative
Uses Technical Assistance and Trade Capacity Building To
Jumpstart Economic Development in the Caucasus
February 2006
Printable version
By Linda
Habenstreit
When the
Doha Development Agenda was launched in November 2001,
WTO (World Trade Organization) members agreed that this
round of negotiations must emphasize development so that
developing countries can share in the benefits of
expanded global trade.
However, to
take full advantage of the opportunities trade can
offer, developing countries need technical assistance
and trade capacity building so they can attract
investment and the critical private sector capital that
will bring with it the latest technology and skills.
CADI (the
Caucasus Agricultural Development Initiative) is one of
many capacity building efforts the U.S. government and
USDA in particular have spearheaded. This initiative
focuses on economic development and trade capacity
building in Armenia and Georgia. The aim is to raise
agricultural growth and integrate these countries into
global agricultural markets.
CADI
provides targeted, long-term technical assistance and
institutional and policy capacity building to
governmental bodies and private agribusiness.
Economic
Progress Spurs Investment
Despite separation from the Soviet republics in 1991,
Armenia and Georgia still have transitional economies.
Armenia’s
wide-ranging reforms in 1994 dramatically lowered
inflation and created growth, making the country
economically stronger.
Steady
economic progress has attracted the attention of
international organizations and foreign financial
institutions, which have extended grants and loans to
reduce Armenia’s budget deficit, stabilize its currency
(the dram) and develop its private business sectors.
Continued
progress depends on increasing tax and revenue
collection, improving the investment climate,
eliminating corruption and resolving regional ethnic
conflicts.
Georgia’s
economic progress has slowly improved since 2000. Its
economic activity has not reached its full potential due
to poor fiscal management, pervasive corruption,
arbitrary implementation of laws and regulations and the
poor condition of the country’s energy, transportation
and communication sectors.
In 2004,
the newly elected Georgian government began to address
these problems, rescheduling its debt and establishing a
program with the International Monetary Fund to reduce
poverty and increase growth.
The United
States and other countries have encouraged reforms in
both countries by providing technical and institution
building assistance.
In fiscal
2006, both Armenia and Georgia were made eligible to
apply for U.S. MCA (Millennium Challenge Account)
assistance. The MCA provides U.S. development assistance
to countries that rule justly, invest in their people
and promote economic freedom.
CADI
Partnerships, Projects Make a Difference
CADI is an example of technical and trade capacity
building assistance that makes a difference. It has
helped to increase Armenia’s agricultural productivity
and improve its marketing, resulting in significant job
creation. The secret to this success is the partnerships
formed under CADI between U.S. and Armenian public and
private sectors, academia, nongovernmental organizations
and private voluntary organizations.
CADI is
funded by the Freedom Support Act, which is administered
by the U.S. Department of State. In fiscal 2005, CADI
was allocated $7.6 million for activities in both
Armenia and Georgia.
With the
assistance of USDA’s Cooperative State Research,
Education and Extension Service, FAS has used this
funding to send U.S. land grant university experts and
USDA specialists to Armenia to provide assistance in
food safety, animal and plant health and agricultural
trade policies and regulations.
FAS also
has an agreement with CARD (the Center for Agribusiness
and Rural Development), an Armenian nongovernmental
organization, to provide the country’s private sector
with technical assistance.
Last
November, in an effort to better manage the initiative,
FAS opened an office in Yerevan, Armenia.
Other CADI
partnerships and projects include:
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Working with the Armenian Ministry of Agriculture to
improve the collection of agricultural statistics and
market information, develop a food safety system that
meets international sanitary and phytosanitary
standards and develop an organic certification program
to increase agricultural trade.
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Supporting development of a functioning farm credit
system by working with the U.S. FCA (Farm Credit
Administration) and CARD.
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Helping create sustainable nongovernmental
organizations and institutions with local technical
expertise. So far, CADI has sponsored activities with
Armenia’s Agribusiness Teaching Center, CARD, the ARID
Goat Breeding and Research Center and the Small Farm
Water Management Resource Center.
Both the
Agribusiness Teaching Center and the Small Farm Water
Management Resource Center are located at the Armenian
State Agrarian University in Yerevan.
Since the
Agribusiness Teaching Center was formed, 23 Armenians
and Georgians have graduated with bachelor’s degrees.
In
addition, FAS is sponsoring a two-way trade and
investment mission with Georgia, May 15-19, 2006, to
promote agribusiness cooperation, trade and investment
in the Caucasus. Product focus will be on agricultural
processing equipment, inputs, livestock genetics,
ready-to-eat products, meat and poultry and grain and
feed.
Up to 15
U.S. companies will be able to attend this trade
mission. This means that, while U.S. companies are
exploring trade and investment opportunities in the
Caucasus for their products, Georgian agribusiness
representatives will be able to explore opportunities
for exporting their products to the United States.
For more information about
the Georgia Trade and Investment Mission, contact
Darrell Upshaw, FAS International Cooperation and
Development area. E-mail
darrell.upshaw@usda.gov
For more information about
CADI, contact Fred Johnston, FAS International
Cooperation and Development area. E-mail:
johnstonf@usda.gov
Linda Habenstreit is a
public affairs specialist in the FAS Public Affairs
Division. E-mail:
Linda.Habenstreit@usda.gov
USDA Helps Build
Developing Countries’ Capacity To Trade
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USDA’s
trade-capacity building strategy falls into three
categories:
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Developing
regulatory frameworks, especially on SPS (sanitary
and phytosanitary) issues, promoting sound science
and strong international standards-setting bodies
and fostering international standards based on
sound science.
USDA provides training and technical assistance in
topics ranging from food safety to SPS standards
to standards-setting bodies. This training and
assistance helps developing countries create
regulations that are transparent and
scientifically based; supports the adoption of
science-based regulations concerning human, animal
and plant health and safety so that plant
infestations or animal diseases can be better
monitored and mitigated; strengthens
infrastructure; and enhances cooperation with
foreign policy and regulatory officials, thereby
reducing trade impediments and barriers by
increasing compliance with international norms.
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Enhancing
institutional market infrastructures, including
strengthening market information systems, grades
and standards and cold chain practices.
USDA provides technical assistance and training to
help developing countries enhance their
agricultural market information systems, using
both conventional and emerging technologies. This
training shows developing countries how to
collect, analyze and disseminate statistical and
economic information needed to compete, both
regionally and globally. Better, faster and more
reliable communications and transportation systems
must underpin these information systems.
USDA
also provides training so countries can create
clear, concise grades and standards for fruits,
vegetables and bulk commodities. USDA supplies
technical assistance so countries can use
appropriate cold chain processes to preserve the
safety and quality of perishable products.
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Instilling human and
organizational capacity to help countries engage
effectively in trade discussions and international
organizations and to promote science-based
policies.
Developing countries
need help in understanding how internationally
recognized guidelines work, understanding their
obligations and rights and having workable and
credible institutional systems in place. Many
developing countries need to understand more fully
about the Codex Alimentarius, the
International Plant Protection Convention and the
World Animal Health Organization, which are the
three international standards-setting bodies for
food, plants and animals. USDA provides technical
assistance, scientific training and research
opportunities to developing country decision
makers, researchers and scientists so they become
familiar with these organizations and their
regulations.
Specific examples of USDA trade capacity building
efforts include:
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CAFTA-DR
(U.S.-Central America-Dominican Republic Free
Trade Agreement).
This was the first
free trade agreement with a trade capacity
building component. From this point forward, every
U.S. FTA (free trade agreement) negotiated with an
emerging or developing country will likely include
trade capacity building. To meet this requirement,
the United States provided training and technical
assistance in science-based standards for meat and
poultry to Costa Rica and Nicaragua, and worked
with all six CAFTA-DR partners to improve their
capacity to collect data and conduct statistical
surveys on agricultural planted area and
production, agricultural prices and rural incomes.
Access to timely and accurate agricultural
statistics will help producers, exporters and
importers better identify trade opportunities in
international markets.
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WTO/SPS Outreach to
Latin American and Caribbean Countries.
For nearly three
years, USDA has supported the efforts of the
Inter-American Institute for Cooperation on
Agriculture, a regional international agriculture
organization, to train two government officials
from each of its 34-member countries on the
WTO/SPS committee and the issues and rules it
covers. All members have received this training.
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Africa Pest-Risk
Assessment Training.
Since 2000, FAS and
APHIS (USDA’s Animal and Plant Health Inspection
Service) along with USAID (the U.S. Agency for
International Development) have collaborated on
SPS issues in Africa. Before this training began,
virtually no such assessments were being conducted
in Africa. More than 200 people from 35 countries
in Sub-Saharan Africa have been trained on a
variety of SPS issues. These activities support
the Africa Growth and Opportunity Act, which was
enacted by the U.S. Congress in 2000 to support
the growth of democracies and economies in
Sub-Saharan Africa.
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Worldwide
Development Goals Give Impetus to U.S. Capacity
Building Efforts |
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The
United States has broad, comprehensive trade
capacity building programs throughout the world.
With such programs, developing countries can harness
the power of trade and create open, predictable
policies and procedures to boost economic growth and
reduce poverty. Examples of these programs include:
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The MCA.
Provides targeted aid to developing countries that
take responsibility for their own economic
progress through good governance, sound policies
and the rule of law. To date, the Millennium
Challenge Corporation has been allocated $4.1
billion to run the MCA.
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ODA (Official
Development Assistance).
In 2002, President Bush pledged to increase U.S.
core development assistance by 50 percent over
three years. The United States has gone beyond
this pledge—ODA was increased from $10 billion in
2000 to $19 billion in 2004.
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Trade Capacity
Building Assistance.
The United States is the largest single country
donor of such assistance. Total U.S. funding for
trade capacity building activities in 2005
exceeded $1.34 billion, up from $921.2 million in
2004.
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Integrated Framework
for Trade-Related Technical Assistance.
Since the launch of the Doha Development Agenda in
November 2001, the United States has contributed
almost $5 million to this international initiative
through which the International Monetary Fund,
International Trade Centre, United Nations
Conference on Trade and Development, United
Nations Development Program, World Bank, and the
WTO combine efforts to respond to the trade
development needs of least developed countries.
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Aid for Trade.
At the December 2005 WTO Hong Kong Ministerial,
the United States announced it would more than
double its grant contributions to help developing
countries build their capacity to trade. The U.S.
contribution to the global Aid for Trade fund
administered by the World Bank and International
Monetary Fund will increase from $1.3 billion in
2005 to $2.7 billion annually by 2010.
Much of
the impetus for these efforts originated with the
Millennium Development Goals set at the United
Nations Millennium Summit in 2000 and the 2001 Doha
Development Agenda. These efforts focus on the needs
of developing countries—from the development and
trade perspectives, which complement one another.
Both have the potential to make positive changes in
the lives of half the world’s people. |
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