Today the WTO Public Forum kicks off in Geneva. During four days participants will reflect on and discuss this year’s theme: “Trading forward- Adapting to a changing world”. Responding to emerging priorities requires flexibility. Sweden is a key donor of flexible funding, also called unearmarked core funding. Today we meet Executive Director of the Enhanced Integrated Framework (EIF) Mr Ratnakar Adhikari in our series of interviews on the importance of flexible funding. Why is unearmarked funding so important in the future and what has Sweden’s unearmarked aid achieved? How do EIF and Sweden together better position the least developed countries (LDCs) in the global economy?
Mr Adhikari, Sweden is a key donor of unearmarked funding. Some other donors prefer more earmarked funding. What would you say is the main difference between these forms of funding?
Ratnakar Adhikari: The EIF has continued to respond to the evolving trade needs of the least developed countries (LDCs) in today's increasingly unpredictable trade environment. Unearmarked funding affords the flexibility to effectively target areas for which there is a demand and where support is most needed. It is an important enabler of our commitment to country ownership and putting the LDCs in the driver's seat of the EIF partnership.
Through unearmarked funding, the EIF is effectively deploying targeted and demand-driven support to producers and training officials to develop and implement home-grown trade agendas, building the capacity of small businesses and women entrepreneurs. These interventions ultimately help the LDCs to better position themselves to effectively participate in the global economy.
EIF is the only multilateral partnership dedicated exclusively to empower the LDCs use of trade and investment to integrate into the global trade system for achieving sustainable development and poverty reduction. For EIF's work, at all levels, is Sweden’s unearmarked funding helpful and if so in what ways?
Ratnakar Adhikari: In today's complex trade environment, the EIF's support is needed more than ever. Improving the economic prospects of the LDCs remains a key global challenge. While the EIF's overarching goals have remained constant, our ways of operating continuously evolve in response to the opportunities and challenges for better situating the LDCs in the global economy. This evolution can be seen, for example, in our response to the transition from the third to the fourth industrial revolution, which is being driven by technology. With this transition, the premium on skills, innovation and concrete analysis has never been more important.
The EIF has been responding appropriately to the needs of the LDCs in this evolving climate, which is a testament to the EIF's ability to remain agile without losing sight of our core competence on analytical work, as well as institutional and productive capacity-building. Allow me to share a few examples:
Improving women's and youth's access to trade opportunities offered by the digital economy is also an area in which we are increasing our focus. We have partnered with UNCTAD on analytical work (e-trade readiness assessments) and provided follow-up support to Bhutan, Cambodia, Myanmar, Nepal, Senegal and Rwanda to build their e-commerce capacity.
Recognizing that investment could be a powerful tool for helping the LDCs to realize their trade potentials while addressing trade-related constraints, we are embarking on a partnership with WAIPA and IFC. A regional project in East Africa is currently unearthing the potential from mainstreaming cutting-edge ICT services in agriculture across the region.
We are in addition ensuring that no country is left behind by putting in place a targeted approach for operating in the LDCs affected by conflict and fragile situations.
Responding to these emerging priorities requires flexibility. We are, where possible, combining existing funding windows by consolidating "’Tiers"’ and improving our results focus through thematic calls for proposals to target specific indicators in the EIF Results Framework. Unearmarked funding is a critical facilitator of this flexible approach to the trade needs of the LDCs.
Sweden has been supporting the EIF since 2009. Between 2017-2021, the allocated flexible funds to EIF amounted to approximately 10 MUSD. An additional 5 MUSD has been allocated for 2021-2022. Can you give some recent examples of how the unearmarked funding has been useful in your activities?
Ratnakar Adhikari: Let me preface my response by mentioning that Sweden hosted the first EIF Pledging Conference in Stockholm in 2007, where a total of USD 250 million was pledged by the EIF Donors.
Over the past ten years, the EIF has helped the poorest countries to strengthen the policy environment for trade, enable exports to untapped new markets and ensure that goods and services move easily across borders.
Sweden has been a close partner and supporter of the EIF throughout this journey, and we are proud of the impacts collectively achieved in ensuring inclusive trade for better lives in the LDCs.
Sweden's contribution to the EIF Trust Fund in EIF's Phase Two has been most recently:
We are extremely grateful for Sweden's strong commitment and efforts and look forward to continuing this remarkable journey to better position the LDCs in the global economy!
EIF is a partnership of expert agencies that works closely with governments, development organizations, civil society and academia. For their official website, please see here.
With special thanks to the Enhanced Integrated Framework!