By Paul Spray (Traidcraft) with inputs from Sarah Montgomery (CAFOD)
Paul is the Director of Policy and Programmes at Traidcraft. CAFOD and Traidcraft have been working together for a number of years on the aid for trade and small business agenda (see the footnotes below). It is great to welcome Paul as a guest
This month, DFID for the first time cancelled a programme as a result of a review by the government’s Independent Commission for Aid Impact (ICAI). It was a flagship programme called Trademark Southern Africa, whose purpose was “to improve southern Africa’s trade performance and competitiveness for the benefit of poor women and men”.
ICAI was fairly stark: “DFID’s objectives… fail to address adequately the impact on the poor.” What DFID has failed to do, they said, “is consider in any depth the transmission mechanisms that could link increased regional trade to poverty reduction. Such links are assumed, rather than analysed and built into programme design.” They go on to highlight that “trade growth can result in risks to the poor. Neither DFID nor TMSA is doing enough to understand the potential positive impacts or to mitigate against the potential negative impacts on the poor.”
Unfortunately, this is part of a pattern. In 2012 Traidcraft and CAFOD commissioned a review of DFID and EC projects from a well-known consultancy group working on Aid for Trade. They concluded ruefully “There is very little publicly available information on whether aid for trade projects and programmes are impacting on poverty. There is typically a gap between strategic ambitions and statements on poverty reduction and the actual project design, implementation andM&E.”
So what kind of aid for trade projects would impact on poverty? We have some ideas, based on our experience in the field. For example:
- Back small enterprises in terms of targeted financial and policy support.
- Identify ways in which market systems (particularly local ones) can be developed and changed to make it fairer and easier for poor producers to participate.
- In international supply chains, reduce the risks borne by developing country suppliers, because developed country buyers are in a much better position to bear risk.
- Where regulatory and policy reform advice is given, ensure that it helps small businesses, is locally appropriate and is based on consultation with them (rather than assuming traditional size-neutral policies will create a level playing field).
- Support ways in which workers and small producers can make their voice heard in international supply chains, following the recommendations of the UN Principles on Business and Human Rights.
CAFOD and Traidcraft have published various reports to detail what we recommend, learning from our failures as well as our successes. The ICAI report commented “Trademark Southern Africa and DFID do not adequately consult with representatives of intended beneficiaries or other stakeholders…” Clearly the local actors are the most important for DFID to listen to – but they could also take a look at what NGOs have learnt in supporting producers and traders.
CAFOD, “Thinking Small: Why poor producers and small business owners may hold the key to a sustainable recovery”. 2011. http://bit.ly/1czZFHv
CAFOD,“Thinking Small 2: Big ideas from small entrepreneurs.” 2013. http://bit.ly/ZmIjGN