Aid-for-Trade: the Way Forward for Development?

Abstract

The failure to eradicate poverty through trade-induced economic growth over a number of decades raises questions about the latest initiative: Aid-for-trade. After examining whether the initiative signifies a new paradigm for achieving development, this thesis employs an empirical analysis of the East Asian region with a particular focus on Malaysia, the Philippines, Thailand and Vietnam to find no clear relationship between Aid-for-trade flows and measures of development even for individual sectors in these countries. It is concluded that this is due to Aid-for-trade flows being designed to maximise the donor’s economic and political position rather than the recipient’s development.