Geneva - The World Bank announced Monday that a programme to counteract the lack of trade financing has received 6 billion dollars for loans to promote commerce in the developing world. The Global Trade Liquidity Program, which was set to begin disbursing the loans, said it hoped to generate 50 billion dollars worth of trade over three years using cash raised through donors and the private sector.
The announcement was made during the World Trade Organization's second review of the Aid for Trade programme, which was launched in 2005.
It aims to help developing countries integrate into the global trading system and cushion blows from exposing themselves to liberalization.
The credit crunch was also a factor behind the expected contraction of trade volumes this year by 10 per cent.
This drop presents the largest challenge faced by the international commerce system, WTO chief Pascal Lamy said Monday.
"Global trade growth of 6 per cent in 2007 has been replaced by a projected 10 per cent contraction in 2009. It is one of the biggest challenges that the multilateral trading system has faced since its inception," Lamy said, noting it was impacting particularly severely on the world's poor.
The WTO members are still negotiating the Doha Development Round of trade talks, which were launched in 2001. Lamy said by next year he hopes to complete the stalled round, which would further open up markets, though gaps on some aspects of market access and subsidies remain wide.
United Nations Secretary General Ban Ki-moon said improving trade flows can help mitigate the economic crisis, aiding the poorest.
Infrastructure improvements and better regional cooperation were key to improving trade and economic growth, a joint report by the WTO and the Organisation for Economic Co-Operation and Development said.
