Highlights

The EU Aid for Trade Progress Report 2022 is the fifth report under the updated EU Aid for Trade strategy and illustrates the EU’s contribution to the global Aid for Trade initiative. The EU Trade Policy Review – An Open, Sustainable and Assertive Trade Policy, adopted in 2021, includes several priority areas related to trade with developing countries, such as promoting responsible and sustainable value chains, as well as strengthening the EU’s partnerships with Africa. The strategy also commits the EU to play a leading role in creating momentum for meaningful WTO reform.

EU preferential trade agreements and schemes are major drivers of the EU’s relationship with developing countries, complementing, and adding an additional layer for cooperation on top of traditional development assistance. As of June 2022, 123 partner countries and territories that are eligible for EU official development assistance (ODA) have preferential access to the EU market, 62 through a preferential trade agreement in force, and 61 through one of the three unilateral EU preferential trade schemes under the Generalised Scheme of Preferences - GSP (Standard GSP, Everything But Arms, GSP+). Only 19 developing countries have no preferential or reciprocal trade preferences with the EU.

Developing countries, excluding China, accounted for 29-32% of total EU27 imports of goods over the decade 2011- 2020, and over 80% of EU imports from developing countries, excluding China, were duty-free.

The current GSP scheme runs till the end of 2023. In September 2021, the Commission adopted the legislative proposal for the new EU’s Generalised Scheme of Preferences (GSP) for the period 2024-2034, expanding the number of conventions GSP+ countries must ratify to thirty-two from the current twenty-seven with a possibility to withdraw GSP benefits for serious and systematic violations.

EU collective Aid for Trade peaked in 2020 reaching almost EUR 23 billion, 47% of all aid for trade from bilateral and multilateral sources. Most of the growth between 2019 and 2020 has been concentrated in banking and finance, probably due to the use of quick disbursing credit lines to support local exporters to support a rapid supply response to the COVID-19 pandemic. EU Aid for Trade in LMICs is more concentrated on energy and transport infrastructure.

Through the chapters on Trade and Sustainable Development (TSD) the EU and its trading partners make strong and binding commitments to respect and implement international conventions on labour rights and environmental conservation.

Notwithstanding the increased volume of EU AfT addressing climate change and the environment, only one third of respondents to this year’s survey (down from half last year) said that their AfT either considerably or extremely contributed to addressing environmental challenges in their respective countries. This is consistent to the still relative low share of EU AfT addressing climate and the environment as a principal objective (around one fifth of total EU AfT).

EU AfT for nutrition has been growing steeply after the COVID-19 crisis reaching over EUR 1 billion in 2020, compared to a little over EUR 100 million in 2018 when the nutrition marker was introduced for OECD/DAC statistics. Support for food quality, safety and security has remained lower and relatively stable over the last decade at about EUR 300 million/year.