Channelling aid money towards trade will assist Pacific

Transcript

Channelling aid money towards trade programmes is being seen as an important step towards Pacific Island forum countries achieving sustainable economic growth.

The Federated States of Micronesia has become the 10th country to sign a Memorandum of Understanding to establish the Pacific Regional Trade and Development Facility.

The director of the economic governance programme at the Forum Secretariat Shiu Raj told Bridget Tunnicliffe the MOU now comes into force with 10 countries signing on.

SHIU RAJ: It now provides for the platform that is needed to start exploratory work into the establishment of the facility. So we will look into options of terms of gathering the necessary resources to put in place the facility which will take the form of a management structure and a process that will allow for the channeling of aid for trade resources towards the forum island countries trade related needs.

BRIDGET TUNNICLIFFE: How does this aid for trade work? What are you hoping to achieve?

SJ: Well, the needs of the forum island countries in terms of developing their trade to deal with specific issues such as management of their exports, reducing their import deals, in terms of assisting in the economic development and ultimately helping in the reduction of poverty is something for which there is a continuous need for development assistance so the regional facility could become the conduit through which some of these regional programmes can be initiated to assist more than a few countries.

BT: Is it easier to get aid if the donors can see that it will translate into better trade and economic opportunities?

SJ: Well, I think that is a difficult question. It is never easy to get aid because there is competition for the aid dollar. From that perspective, there has to be a bit of analysis done in terms of how can the aid really assist in meeting the development objectives of the forum island countries. The intention is to develop trade, to deal with the economic growth issues, economic growth that will subsequently lead to elimination of poverty and building the capacity of the forum island countries so from that perspective it is extremely important for the development partners to understand that an effective way of channeling aid is to help the forum island countries build their capacity for sustainable trade.

BT: Do you envisage that trade programmes will attract new aid spending or tap into current aid?

SJ: Well, we would like to think that there should be new aid allocated towards development of trade because we are talking about building sustained capacity of the forum island countries to able to trade on a continuous basis so this is really an investment that we are looking at into the countries.