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Aid for Trade at a Glance 2019

Economic Diversification and Empowerment

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This edition analyses how trade can contribute to economic diversification and empowerment, with a focus on eliminating extreme poverty, particularly through the effective participation of women and youth. It shows how aid for trade can contribute to that objective by addressing supply-side capacity and trade-related infrastructure constraints, including for micro-, small- and medium-sized enterprises notably in rural areas.

The analysis is based on the views of 133 respondents – 88 developing countries, 35 donors, 5 providers of South-South trade-related support and 5 regional organisations – who participated in the 2019 aid-for-trade monitoring and evaluation exercise. They share the view that economic diversification is a gateway for economic empowerment, but also that empowerment is essential for economic diversification particularly when it enables youth, women and micro-, small- and medium-sized enterprises to engage in international trade.

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Aid for trade in challenging contexts

The least developed countries face the greatest challenges in realizing the full potential of economic diversification with all the benefits that it can bring for economic growth, development and poverty reduction. While trade flows remain vital for LDC economies, their share in world trade is still below 1%. LDC merchandise exports are highly concentrated in few products. Primary commodities account for over 60% of the LDC exports making these countries very vulnerable to the external shocks. These trends are even more pronounced in the LDCs which identified themselves as fragile under g7+ initiative. In those countries top three export products represent at least 40% of their merchandise exports.

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