CEB Inter-Agency Cluster on Trade and Productive Capacity (CEB)

The CEB Inter-Agency Cluster on Trade and Productive Capacity is led by UNCTAD and includes FAO, ITC, ILO, UNDP, UNEP, UNIDO, UNOPS, WTO and the five UN Regional Commissions.

The CEB Inter-Agency Cluster is an inter-agency mechanism dedicated to the coordination of trade and development operations within the UN System. It proposes comprehensive solutions with an optimized articulation between the formulation of common policy recommendations and their effective translation through joint-programmes at the country level.  

Since its establishment in April 2007 and its official launch by the United Nations Secretary-General during UNCTAD XII Ministerial Conference in April 2008, the CEB Inter-Agency Cluster on Trade and Productive Capacity makes a concrete and direct contribution to the overall Aid for Trade initiative and United Nations System-wide Coherence reform by coordinating its participation:

• In the United Nations System including, as appropriate, within the United Nations Development Group (UNDG) machinery, with the view to the formulation of new United Nations rules, standards and best practices for development operations.
• In the Countries involved in a United Nations Development Assistance Framework (UNDAF) and having adopted a "Delivering as One approach". 

 Initiatives

The following is a summary of the main initiatives undertaken by the CEB Cluster:

Contribution to the United Nations System-wide Coherence  

• Contribution to the Aid for Trade initiative with complementary assistance provided by the members of the Clusters.
• Cooperation within the Cluster on the design and formulation of common policy analysis and recommendations developed in the context of the 2030 Agenda for Sustainable Development.   
• Cooperation and coordination within the Cluster at the UN System level including, when appropriate, within the UNDG machinery for the setting-up of new UN rules standard mechanisms on the Delivering as One (DaO).
• Cooperation and coordination within the Cluster for a better inclusion of the Non Resident Agencies (NRAs) in the DaO process. A better inclusion of the NRAs in the DaO is contributing to the increase of quality of the Joint-Programmes at the country level as those inter-agency operations benefit from a wide range of expertise existing within the UN System, notably on policy issues.       

Operations of the Cluster in the context of the Delivering as One

• Starting initially with projects in the eight One UN pilot countries, the Cluster has greatly expanded its participation in the design and implementation of Joint-Programmes with different intensity and configuration at the regional and national levels.   
• As of 2017, the Cluster is covering more than 30 countries with joint-activities developed in the context of the United Nations Development Assistance Frameworks (UNDAFs).
• The Cluster' operations are designed to propose optimized interface with other inter-agency mechanisms. For instance, in the case of Least Developed Countries, the joint-programmes developed by the Cluster are proposed in conformity with the Enhanced Integrated Framework' diagnostic trade integration studies. 
• Building on the principles of the aid effectiveness agenda, which calls for country-driven, coherent, timely, flexible and result-oriented assistance, the Cluster advocates for innovative pooled financing mechanisms. It encourages for instance funding from bilateral Donors (such as the Switzerland' State Secretariat for Economic Affairs) in support of Cluster' joint-operations managed by a common administrative agent. It also mainly encourages the Donors to support DaO Multi-Donors Trust Funds (such as the ones administered by the Multi-Partner Trust Fund Office) which channel in a transparent and efficient manner different financial flows to achieve common results. The Cluster's experience in the DaO is confirming that the "One UN Funds" (by countries and by categories) are playing an indispensable catalytic role leading to effective resource mobilization at the regional and country levels.

The UN Inter-Agency Cluster Multi-Donor Trust Fund on Trade and Productive Capacity

Presented to Member States during UNCTAD XIV Ministerial Conference in July 2016, the UN Inter-Agency Cluster Multi Donor Trust Fund on Trade and Productive Capacity is aiming at scaling up the activities of the UN Inter-Agency Cluster at both the global and country levels. In the context of the 2030 Agenda for Sustainable Development, the fund is to support the Cluster in building a more holistic vision of trade and productive capacity and in developing concerted policy initiatives for key thematic areas that will guide the implementation of joint programmes at the country level.

Rationale: Trade has been acknowledged as an enabling factor for achieving the Sustainable Development Goals (SDGs). The 2030 Agenda for Sustainable Development represents a paradigm shift in the way all countries conceive economic and social progress which needs to be based on the three equally important and mutually supportive pillars of economic, environmental and social sustainability. The Agenda places trade at the centre stage, by stating that “International trade is an engine for inclusive economic growth and poverty reduction, and contributes to the promotion of sustainable development” (Paragraph 68) and recalls the role of “Private business, investment and innovation as major drivers of productivity, inclusive economic growth and job creation” (Paragraph 67). An increasing number of developing and transition economies have successfully managed to integrate into the world economy in recent decades. However, many countries have not been able to benefit sufficiently from global economic integration and rising trade and investment flows. Their economic and development gap widened with those economies that succeeded associating economic integration with income and job creation. In several cases, the benefits from integration have been mixed and generated growth without employment or created jobs that do not support a long term pattern of poverty reduction, productivity growth, innovation and improving living conditions. Often, the fundamental unevenness in the generation of income and vulnerability in the production and export structure undermines the economic and social sustainability of their economic gains. The challenge for developed and developing countries is now to achieve their sustainable development objectives, through individual and collective actions, benefiting from trade and investment integration through appropriate participation in global value chains and efficient trade facilitation support including modern partnership instruments to lead to improved employment opportunities while taking into consideration the nature of the complex challenges that this might pose in the current economic, environmental and social context.

Value-Added: The Fund is benefiting from a recognized work developed by the Cluster under the three above-mentioned areas which ask for an extensive inter-agency collaboration. Three comprehensive Thematic Notes[1] (summarized below) on Trade and Value Chain Development, Trade Facilitation and Trade and Employment are proposed as integral part of the UN Inter-Agency Cluster MDTF. The work of the Cluster under the three notes is closely interrelated.   

• On trade-led Value Chain Development, the Cluster is proposing systemic capacity-building focusing on entire value chains from primary production through processing to trade. This would include in particular policy and value chain governance, sector business environment, investment and technology transfer, quality and standards compliance, productivity, innovation, value addition, trade logistics, as well as related financial and other trade support services. Effective value chain development requires a well-coordinated multi-agency support. The CEB Cluster partner agencies have combined expertise in all of the above-mentioned areas, which will be coordinated at the Cluster level. The work of the Cluster on Value Chain Development will directly contribute to the SDG 8, 9 and 17, which call for support to export-led industrial and economic development and further integration of SMEs in global value chains and trade partnerships.
• On trade facilitation, the work of the Cluster is a mirror of the national inter-agency collaboration, which is necessary for practically all measures of trade facilitation. It will directly contribute to the article 23 of the WTO Trade Facilitation Agreement entered into force on March 2017.
• On trade and employment, the work of the Cluster is proposing the development of a coherent policy framework that creates jobs using trade as an essential instrument. To achieve that exports support a high share of employment creation  a wide range of coordinated activities in the areas of sectoral and industrial development, investment (both domestic and foreign) promotion, skill strategies development (both in domestic and export sectors), trade and market access mainstreaming (including trade related regulations and voluntary standards), corporate social responsibility and social protection are conducted. The work of the Cluster on Trade and Employment will directly contribute to the SDG 8 aimed at promoting sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all by capturing the connection between growth inclusiveness, sustainability, job creation and quality of work.

A fund capitalizing on complementary initiatives : The work of the Cluster under the three thematic notes all contribute to the SDG 17 on the Global Partnership aiming at promoting a universal, rules-based, open, non-discriminatory and equitable multilateral trading system under the World Trade Organization” while target 17.11 calls for “Significantly increasing the exports of developing countries, in particular with a view to doubling the least developed countries’ share of global exports by 2020”. The UN Inter-Agency Cluster MDTF on Trade and Productive Capacity is aimed at building on existing assistance provided by the individual members of the Cluster in the context of Aid for Trade.

The CEB Inter-Agency Cluster is consisting in an UNCTAD led pooled-financing mechanism opened to the Cluster members' agencies.

[1] To consult the Thematic Notes, see: UN CEB Inter-Agency Cluster on Trade and Productive Capacity:  http://unctad.org/en/Pages/TC/TC_United-Nations-Inter-Agency-Cluster.aspx