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Multi-Donor Trust Fund for Trade and Development 2

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About the Program

The second Multi-Donor Trust Fund for Trade and Development (MDTF-TD2) supports analytical trade work across the World Bank to implement the Trade Strategy from 2012-2015. The trust fund supports work programs developed annually by the Bank's Regions, Networks and other operational units that work on trade to implement activities that fall under the four pillars of the Trade Strategy, namely (i) trade competitiveness and diversification; (ii) trade facilitation, transport logistics and trade finance; (iii) support for market access and international trade cooperation; and, (iv) managing shocks and promoting greater inclusion.

The World Bank has received $29 million in pledges to the MDTF-TD2 from the governments of the Netherlands, Norway, Sweden, Switzerland, and the United Kingdom over the next three years.

For furthur information on the MDTF-TD2, please contact: Ian Gillson, Senior Trade Economist, International Trade Unit

In Depth

Funding Our Trade Work

The MDTF-TD2 complements other global partnerships and World Bank trust funds on trade, notably the Trade Facilitation Facility, the Enhanced Integrated Framework for Trade-Related Technical Assistance for Least Developed Countries (EIF), and the Aid for Trade initiative. It finances global public goods--such as toolkits, benchmarking databases, and research--that help inform country-level activities supported by these programs. It also finances diagnostics, capacity building and analytical activities needed to make projects funded through the TFF, EIF and Aid for Trade initiative more effective.

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Program Structure

    The MDTF-TD2 operates through a programmatic approach. The World Bank’s six regional divisions and its central International Trade Unit develop annual work programs to implement the Trade Strategy that respond to client demands and challenges emerging from the world trading system. These are submitted annually to the World Bank's Trade Council, which sets the overall direction for the MDTF-TD2, approves funding envelopes, and discusses annual work programs. The Trade Council is chaired by the Director of the World Bank's International Trade Unit and includes leaders of regional trade practices, as well as operational directors and managers of units that undertake significant trade activity. Stock-taking to donors is done via a consultative group.

    Approximately 70 percent of funding provides direct support for country and regional activities responding to specific client needs. For fiscal year 2013, the Trade Council has allocated 50 percent of this funding to work in sub-Saharan Africa. Each of the other five Regions receives ten percent of this funding.

    At the global level, the trust fund finances development of benchmarking datasets (e.g., the Logistics Performance Indictors), policy analysis, economic research, capacity-building programs, and analytical tools. These activities are managed by the International Trade Unit and the Development Research Group. Approximately 30 percent of the trust fund’s resources support this work program.

Eligible Topics and Activities

The MDTF-TD2 supports work on a wide range of trade topics, including issues such as trade policy and agreements, export competitiveness, trade facilitation, behind-the-border constraints to international trade, and distributional effects of trade and trade policy reform. The program seeks to ensure that trade-related activities at the country level draw on cross-sectoral expertise, bridging gaps between economic policy, infrastructure, private sector development, and rural development, as well as new cross-cutting issues such as climate change and gender.

Activities eligible for financing include technical assistance, research and policy analysis, project preparation, capacity building and training, compilation of trade data, analytical tools and other toolkits for policy makers, and dissemination of knowledge through conferences and workshops. Activities financed by the trust fund may be executed by the World Bank or by recipient governments.

Since it became operational in June 2012, the MDTF-TD2 has been supporting 39 activities at the country and regional level, mostly analytical work and technical assistance activities, but also activities that enable investment lending.

Examples of activities being supported under the MDTF-TD2 include:

  • - Expansion of the Exporter Dynamics Database, which helps policymakers in developing countries monitor and understand export growth and obstacles to export growth from the micro level up by allowing for cross-country comparisons of exporters based on factors such as size, survival, growth, and concentration;
  • - Support for the Africa Competitiveness Report--developed jointly by the World Economic Forum, the African Development Bank and the World Bank--to highlight areas of competitiveness that are in need of urgent policy action and investment to sustain economic recovery and ensure continued growth in the future;
  • - Technical Assistance to the Iraqi authorities to modernize customs operations;
  • - Establishment of a Trade Costs Dataset that reveals the disproportionately higher costs and lower levels of trade integration experienced by developing countries, and stresses the importance of supply chains and connectivity constraints. The dataset and associated methodology to estimate trade costs opens new analytical possibilities for policymakers and researchers working on trade integration;
  • - Assessment of the viability and performance of bilateral labor agreements and their effect on trade in services;
  • - Analytical work on what constitutes "good practice" in regional integration with regard to non-tariff measures, services, and trade facilitation.

Outputs: Country and Regional Work


Archive: Country and Regional Outputs from the first Multi-Donor Trust Fund for Trade and Development (MDTF-TD1)

Outputs: Global Knowledge Products


Global Knowledge Products supported by the MDTF-TD2 originate from two sources within the World Bank:

  • The International Trade Unit, which is a central provider of trade expertise in the World Bank Group. The role of the International Trade Unit is to develop knowledge products (data and indicators; diagnostics and implementation toolkits; and policy-oriented analytical work) with an operational perspective, to disseminate knowledge on trade through training and learning activities, and to forge effective partnerships inside and outside the WBG to advance a pro-development trade agenda.

  • The Development Research Group for Trade and Integration, which evaluates the development implications of international economic integration in all its dimensions: trade in goods and services, FDI and migration, and non-tariff barriers and regulatory reform. The group's research and analysis furthers understanding of the microeconomic aspects of international integration, the implications of global production fragmentation, and the optimal design of newer forms of trade policy intervention and cooperation.

Archive: Global Knowledge Products and Outputs from the first Multi-Donor Trust Fund for Trade and Development (MDTF-TD1)

Contact Us

    The MDTF-TD2 is managed by the International Trade Unit in the World Bank's Poverty Reduction and Economic Management Network. For more information, please contact Ian Gillson.



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