European Commission Directorate-General for Trade

Development

Trade, Growth & Development

Tailoring trade and investment policy for those countries most in need

European Commission adopts Communication on Trade, Growth & Development

"The rise of emerging economies like India, China and Brazil shows that trade-driven development is possible and that open markets can play a major role in generating growth. Yet those trailing behind need help. World tariffs have never been this low and the EU already offers very favourable market access to poor countries. What will make a difference are non-tariff issues - such as standards, services, intellectual property rights, public procurement, infrastructure and packaging facilities. None of this can work without political governance." said EU Trade Commissioner Karel De Gucht.

The European Commission recommends a greater focus in trade and investment policies in favour of countries most in need.

Trade has long been considered as vital for a country’s development. One needs only to look at the rise of emerging economies like India, China and Brazil to see the impact that trade-driven development can have. Millions have been lifted out of poverty. Yet, while showing positive growth and increased trade, some other developing countries have been further marginalised in an increasingly competitive global landscape. They are often held back by lack of productive capacity, difficulties in diversifying their economy, poor infrastructure and export conditions. The Communication "Trade, growth and development", redefines how the EU's trade and development policy will work for the development of those poorer countries - in particular, Least Developed Countries (LDCs) - ensuring they can increasingly enjoy its benefits.

The Commission proposes a number of ways to improve the effectiveness of EU trade and development tools for those countries most in need, including

• reforming the EU's preferential trade schemes to focus more on the poorest countries,
• stepping up negotiations on free trade agreements with our developing country partners, including Economic Partnership Agreements (mainly in sub-Saharan Africa).
• increasing the use of EU instruments to promote foreign direct investment, including relevant provisions in free trade agreements to enhance legal certainty,
• facilitating developing country exporters, especially small operators, to enter the EU, for instance through the Export Helpdesk, and
• assisting developing countries to improve governance, meet international standards and take better advantage of trade opportunities offered by world markets.

At the same time, the Communication underlines that developing countries' leadership and sense of ownership of their own development is crucial for growth. Developing countries need to undertake domestic reforms to ensure that the poor benefit from trade-led growth.
The EU leads the way in providing trade policy support to the neediest countries, inter alia with the Everything But Arms initiative, and development assistance, in particular on Aid for Trade.