MSI Completes Landmark Trade Evaluation Report for USAID

A team of evaluation experts from MSI and the University of Pittsburgh recently completed a landmark evaluation of U.S. “aid for trade” assistance to developing countries.

The report concludes that USAID and U.S. government programs have contributed significantly to trade capacity building (TCB). The evaluation results found an association between the delivery of U.S. foreign assistance and increases in the value of recipient country exports.

The study separately examined USAID trade assistance focused on private sector export expansion, trade policy reforms, increased participation in trade agreements, and efficiency gains from trade facilitation assistance. The evaluation determined that each additional $1 invested by USAID increases the value of developing country exports by $42 two years later.

“From Aid to Trade: Delivering Results” was presented at WTO’s Third Global Review of Aid For Trade on July 18th and 19th in Geneva. USAID’s Deputy Administrator for the Bureau of Economic Growth and Trade, Eric Postel, lead the U.S. delegation and discussed the evaluation results. The WTO event looked t what has been achieved by developing countries as they have mainstreamed trade into their national development strategies and assessed the impact of donor resources.

The overall summary report presents the findings of a three-phase, cross-country evaluation of U.S. government trade capacity building, with a special focus on the segment of this portfolio that USAID administers. A smaller, summary report is also available. A third volume provides a broader look at aid for trade assistance delivered by U.S. government agencies.

In addition to stimulating developing country exports, techniques employed by the evaluation team revealed that USAID TCB projects consistently achieved all or nearly all of their performance targets. Interventions that combined modes of assistance (training, technical assistance and equipment), applied proven approaches for integrating improvements along an export value chain, or actively promoted a public-private sector dialogue were among the most likely to achieve intended results.

Further analysis revealed the importance of strong relations with counterparts and the coordination of assistance with their reform processes. The report also highlights key opportunities for improving the monitoring and evaluation of TCB assistance.

World trade has undergone a dramatic expansion over the last 30 years, with the share of total trade from developing countries having surpassed that of industrial countries. However, not all countries have participated equally in these advances. Many poor countries still strive to fully benefit from integration into global markets. Since 1999, the U.S. government has invested roughly $14 billion in TCB assistance to developing countries in all parts of the world.

The evaluation also offered recommendations for further enhancing the effectiveness of aid for trade assistance.