Increasing trade is key to ending extreme poverty and boosting shared prosperity. Evidence shows that countries open to international trade tend to grow faster and provide more opportunities to their populations. The World Bank Group helps its client countries improve their access to developed country markets and enhance their participation in the world economy. On the global stage, the WBG supports an open, rules-based, predictable, international trading system.

The trade policy agenda has evolved significantly since the early 1990s when trade liberalization was the focus of the debate. Now, countries world-wide have relatively low import tariffs, and new challenges have emerged. Non-tariff measures have increased sharply, sometimes because governments hope to protect domestic industries. Restrictiveness to trade in services and limited competition in services markets remains pervasive among developing countries, reducing the scope for integration in services. Finally, the proliferation of regional and bilateral preferential trade agreements complicate the trade policy landscape.

Developing countries also struggle with indirect factors that hinder their access to global markets, such as anti-competitive business practices, regulatory environments that are unfavorable to business growth and investment, or limited infrastructure capacity. Even a country with liberal and transparent trade policy suffers if its markets are not connected, and many of the “bottom billion” live in countries – or regions of countries – that are landlocked, remote, or otherwise ill-served by international trade links. The World Bank Group (WBG) is the main multilateral provider of Aid for Trade, development assistance designed to help developing countries more effectively engage in international trade. Experts within the WBG’s Trade and Competitiveness Global Practice are working around the world to help the institution’s clients overcome the obstacles they face.




The WBG is supportive of an open, rules-based, predictable multilateral trading system, and among its objectives are to help countries participate in and enjoy the benefits of such a system. Key strategies for reaching these goals are supporting trade agreements, emphasizing trade and competitiveness at the core of national development strategies, and promoting trade-related reforms through effective Aid for Trade programs.

The WBG helps governments design and implement policies to maximize their trade competitiveness in both goods and services. The approach encompasses the full set of policies that shape individual firms’ capacities and incentives to import and export. The work aims to help governments reap the gains from openness to trade and regional integration, and also to manage risks of economic changes, such as adjustment costs and external shocks. The main pillars of the World Bank Group’s work in trade are:

·         Trade Policy and Integration: Analysis and policy advice to help countries eliminate unneeded non-tariff measures, or NTMs | Modernizing services regulations and trade | Addressing the poverty and labor impacts of trade policies and shocks | Supporting global and regional integration, including free trade agreement negotiations and World Trade Organization accession and participation.

·         Trade Performance: Help for governments in designing and implement policies to maximize their trade competitiveness in both goods and services. | Assistance to create a comprehensive policy frameworks that shape individual firms’ capacities and incentives to import and export | Help for governments to reap the gains from openness to trade and to manage both adjustment costs and external shocks.

·         Competition Policies: Eliminating anti-competitive market regulations | Strengthening antitrust rules | Promoting pro-competition sector policies | State-owned enterprises.

·         Trade Facilitation and Logistics: Strengthening trade corridors, supply chains, and trade logistics | Modernizing border management | Enhancing connectivity between firms, markets, and consumers.

To fund much of this work, the World Bank Group has five main, trade-related trust funds totaling $122 million:

•       The Multi-Donor Trust Fund for Trade and Development 2 (MDTF-TD2) is the largest source of donor funds supporting analytical trade work across the WBG. The WBG has received $34.5 million in pledges to the MDTF-TD2 over three years.

•       The Trade Facilitation Support Program (TFSP) is multi-donor platform launched in June 2014 that provides developing countries with rapid-response technical assistance to help them align with the World Trade Organization’s December 2013 Trade Facilitation Agreement. To date, 30 countries have sought support from the $30 million trust fund.

•       The Trade Facilitation Facility (TFF) supports improvements in customs and other trade facilitation systems that help developing countries reduce trade costs and improve competitiveness. As of March 2015, 76 projects with an allocation of $49.8 million have been approved. Eighty percent benefit African countries.

•       The Enhanced Integrated Framework (EIF) trust fund supports WBG work as part of the global EIF partnership’s efforts to help least developed countries tackle constraints to trade. It funds capacity-building in LDCs, diagnostics that identify key trade constraints, and implementation of technical assistance projects. The trust fund has received $4.3 million and is currently providing trade-related support to 15 LDCs.

The Transparency in Trade (TNT) trust fund is an ongoing partnership between the ITC (Geneva), UNCTAD, and the WBG, with active support from the AfDB.  Its goal is to collect and make available data on non-tariff measures and services trade policies. Currently, Russia, contributing US$1.5 million, is the only donor to the TNT.



Lending and Technical Assistance:

•       The Great Lakes Trade Facilitation Project, currently under preparation, is a $140 million, multi-country investment operation that tackles constraints to cross-border trade between the Democratic Republic of the Congo and its five neighbors, Burundi, Rwanda, Tanzania, Uganda, and Zambia. Investments in cross-border infrastructure, policies relating to border operations, and cross-border administration will help lower trade costs, improve trading capability, reduce time to cross borders, and help integrate conflict-affected communities.

•       In Lao PDR, WBG technical assistance has helped develop the Lao Trade Portal, an online tool that serves as an authoritative source on the country’s trade laws, regulations, and procedures. The trade portal reduces the time needed for traders to acquire information and carry out transactions.

•       In Honduras, WBG technical assistance improved trade-related procedures for agribusiness products by linking three critical government agencies to simplify exports and imports. More than 700 Honduran companies selling abroad can now obtain export permits in one day, compared to the three days it took previously.

•       In Kenya, the World Bank Group is advising the government on competition regulations that will break up cartels in key economic sectors. These regulations will prohibit anticompetitive agreements, generating private savings for firms and households. Estimates put savings at about $18 million annually in insurance markets alone.

•       In the Philippines, the World Bank Group has helped implement reform that dramatically cuts the time needed to register new vessels. One result is that incumbent operators are no longer able to prevent new companies from serving certain routes. This translates into a potential 5 percent savings in transport logistics costs.

Policy Advice and Analysis:

•       The WBG’s Trade Competitiveness Diagnostic Toolkit facilitates a systematic assessment of a country’s performance and capabilities in export markets. It has been applied in over 25 countries.

•       Within the WBG Doing Business Project, which measures business regulations and their enforcement across 189 economies, the “Trading Across Borders” indicator measures the time and cost (excluding tariffs) of exporting and importing cargo by sea.

•       A recent report, Trading Away from Conflict, analyzes the extent to which trade affects the risk of conflict by mapping and empirically testing the channels through which trade may affect conflict and political stability, using data from more than 120 developing countries and in-depth case studies. It recommends policies for fragile and conflict-affected states.

Open Trade Data:

•      In cooperation with other international development partners, the WBG launched the Transparency in Trade Initiative to provide free and easy access to data on country-specific trade policies. This initiative includes the recently revamped World Integrated Trade Solution (WITS) and the Services Trade Restrictions Database.

•      The biennial Logistics Performance Index (LPI) measures the logistics "friendliness" of 160 countries based on a worldwide survey of freight forwarders and express carriers.

•      The Trade Costs Dataset shows that developing countries face disproportionately higher costs and lower levels of trade integration than high-income countries.

To better monitor trade policy developments, the WBG has supported the Global Trade Alert, a joint venture of think tanks around the world, and maintains the Temporary Trade Barriers Database. Both databases allow users to track the use of trade-distorting government measures initiated since the 2008 crisis.


Trade Strategy

Leveraging Trade for Development and Inclusive Growth

The World Bank Group Trade Strategy, 2011-2021

In its first formal Trade Strategy, the World Bank Group lays out priorities that, in the last decade, have moved away from programs anchored in trade liberalization towards supporting diversification, lowering transport and other trade-related costs, improving access to trade finance, and assessing the poverty-related impacts of trade and trade policies.

More Photos »