NZAID

Trade and development

Snapshot

Man and woman in store.

The potential benefits of trade for reducing poverty and promoting development are enormous. Trade is not just the domain of large, multinational companies. In one way or another, every single person is involved in trade-related activities each day, from buying the newspaper at a local store to importing container loads of products.

According to the Millennium Project's Task Force on Trade, international trade can be a powerful weapon in the fight against poverty . However it is not a solution in itself. Trade programmes must be accompanied by addressing the other root causes of poverty .

NZAID priorities

"No single change could make a greater contribution to eliminating poverty than fully opening the markets of prosperous countries to the goods produced by poor ones." Kofi Annan.

NZAID's Trade and Development Policy recognises that assisting developing countries to comply with international trade rules and regulations is only one part of the story. Helping our partners to reap the benefits from a fairer international trading system also needs to be accompanied by assistance to increase the capacity of poor farmers, producers and small enterprises to engage in local, regional and international markets.

Consequently, NZAID's Trade and Development Programme focuses on the following key areas:

  • Building skills and productivity
  • Addressing barriers to trade
  • Promoting Fair Trade
  • Supporting labour rights.

Building skills and productivity

In supporting communities to benefit from international trade, it is important to take into account the entire supply chain, from farm to table. Such an analysis helps to identify the barriers that poor people face in increasing their stake in international trade.

NZAID aims to help farmers develop their production skills and methods and to improve the quality of their products. This enables them to access new markets at better prices. NZAID's assistance also involves helping developing country partners to increase their capacity to produce goods of higher value through improving their capabilities in processing, marketing, export and branding.

For example, instead of selling tomatoes, farmers may be able to move to producing bottled tomato paste or sauce, which will return greater income.

For examples of NZAID building skills and productivity, see:

Addressing barriers to trade

Border issues such as strict quarantine rules can impede developing countries access to markets. NZAID supports projects which aim to improve the quality and standard of developing country exports, particularly in the agricultural and food sectors, to meet consumer demands for high quality products that conform to international standards.

NZAID's assistance can range from helping countries to improve the quality and safety of food exports, to developing systems to ensure that agricultural exports are pest and disease free so as to meet trading partners' stringent quarantine requirements.

For examples of NZAID Addressing Barriers to Trade, see:

Promoting Fair Trade

NZAID recognises the importance of building consumer awareness of Fair Trade. Fair Trade provides developing country producers with fair returns for their products. Paying a fair price for products is important for products such as coffee, for which the market price has on occasion fallen below the cost of production.

In promoting Fair Trade, the Trade and Development Programme focuses on increasing awareness in New Zealand, thus providing a more lucrative market for Fair Trade products. Amongst other projects, this is achieved through promoting Fair Trade labelling. NZAID also provides core-funding to Trade Aid.

For examples of NZAID Promoting Fair Trade, see:

Supporting labour rights

NZAID supports the promotion and protection of worker rights, labour standards, gender equity and the elimination of child labour exploitation. It is a fundamental human right for people to work in a safe and healthy environment, to be paid a fair wage and to pursue a sound work/life balance. Happier and healthier workers are also more productive.

As consumers become more knowledgeable about working conditions in developing countries, they are increasingly switching to more ethically produced goods and services.

For examples of NZAID supporting labour rights, see:

Relevant link: PDF. NZAID factsheet: Trade (197k)

Relevant link: PDF. NZAID policy: Harnessing International Trade for Development - Part A (245k)

Relevant link: PDF. NZAID policy: Harnessing International Trade for Development - Part B (298k)

Relevant link: PDF. NZAID brochure: Trade Can Reduce Poverty (498k)

Page Last Reviewed: 18 February, 2008

Document URL: http://www.nzaid.govt.nz/what-we-do/trade-and-development.html