ADVANCING AFGHAN TRADE

Transcription

1 ADVANCING AFGHAN TRADE EU TRADE-RELATED ASSISTANCE PROJECT PROGRESS REPORT 12 August June July 2017

2 TABLE OF CONTENTS 1. Context of the Action Executive Summary of the Action Project Coordination and Management Output 1: GIRoA owns a national export strategy and action plan that was developed in a consultative process with the private sector, and has started its implementation Output 2: National public and private stakeholders are enabled to manage and coordinate the implementation of the National Export Strategy and mobilise support to implement the validated roadmaps Output 3: Priority interventions identified during the National Export Strategy design process are implemented to improve regional integration and international trade competitiveness Output 4: Knowledge sharing mechanisms for GIRoA staff on trade policy/negotiation formulation and implementation are established in partnership with a training institute from the region Output 5: Institutional mechanisms to facilitate the implementation of the TFA are established at national level and linked with regional partners Output 6: SME knowledge of how to manage national cross-border procedures and compliance with regional and/or global market requirements is built encompassing priority markets (building on NES findings) Output 7: Public-private consultation process on domestic/regional key pressing trade policy/regulatory/negotiation issues is strengthened Actual Results Activities carried out during the reporting period OUTPUT 1: GIRoA owns a national export strategy and action plan that was developed in a consultative process with the private sector, and has started its implementation OUTPUT 2: National public and private stakeholders are enabled to manage and coordinate the implementation of the NES and mobilise support to implement the validated roadmaps OUTPUT 3: Priority interventions identified during the NES design process are implemented to improve regional integration and international trade competitiveness OUTPUT 4: Knowledge sharing mechanisms for GIRoA staff on trade policy/negotiation formulation and implementation are established in partnership with a training institute from the Region OUTPUT 5: Institutional mechanisms to facilitate the implementation of the TFA are established at national level and linked with regional partners OUTPUT 6: SME knowledge of how to manage national cross-border procedures and compliance with regional and/or global market requirements is built encompassing priority markets (building on NES findings) OUTPUT 7: Public-private consultation process on domestic/regional key pressing trade policy/regulatory/negotiation issues is strengthened Overarching Focus on Trade Learning and Capacity Building for Regional Co-operation throughout all the above components Difficulties encountered and measures taken Implementation of the Visibility and Communication Plan Request for payment WORK PLAN FOR YEAR ANNEX I: MEDIA REPORT

3 LIST OF ABBREVIATIONS AND ACRONYMS USED ACCI ACE AICF AISA ANPDF ANSA ANTP ATAR AWBF BMZ CBM CEO CWS DFID DG DM EIF EPAA EU EUD FAO GIRoA GIZ HACCP HEC ICC IIFT IMCTF IMCWTF ISO IT ITC LEAD MAIL MoCI MoPH NES NFF NNA NTFC PPD PPDP PPT Afghanistan Chamber of Commerce Afghanistan Center of Excellence Afghanistan Investment Climate Facility Afghanistan Investment Support Agency Afghanistan National Peace and Development Framework Afghanistan National Standards Agency Afghanistan National Trade Policy Afghanistan Trade and Revenue Afghan Women's Business Federation Federal Ministry for Economic Cooperation and Development (BMZ) Curriculum-based measurement Chief Executive Office Centre for WTO Studies, Indian Institute of Foreign Trade Department for International Development Director General Deputy Minister European Investment Fund Export Promotion Agency Of Afghanistan European Union European Delegation To Afghanistan Food and Agriculture Organization Government of Islamic Republic of Afghanistan Gesellschaft für Internationale Zusammenarbeit (German Development Agency) Hazard Analysis and Critical Control Point High Economic Council Afghanistan International Chamber of Commerce Indian Institute of Foreign Trade Inter-Ministerial Commission on Trade Facilitation Inter-Ministerial Committee on WTO and TF International Organization for Standardization Information Technology International Trade Center Leading Entrepreneurs of Afghanistan for Development Ministry of Agriculture Irrigation and Livestock Ministry of Commerce and Industries Ministry of Public Health, Islamic Republic of Afghanistan National Export Strategy Note For File National News Agency National Trade Facilitation Committee Public Private Dialogue Public-Private Development Partnership PowerPoint Presentation 3

4 RSVP RTFCM SIMT SME SPS TBC TBT TF TFA TSI UNAMA UNCTAD USAID USD VC WTO Répondez s'il vous plaît Regional Trade Facilitation Committee Strategy Implementation Management Tool Small and medium-sized enterprises Sanitary and Phytosanitary To Be Confirmed Technical Barriers to Trade Trade Facilitation Trade Facilitation Agreement Trade Support Institutions United Nations Assistance Mission in Afghanistan United Nations Conference of Trade and Development United States Agency for International Development US Dollar Video Conference World Trade Organization 4

5 1. CONTEXT OF THE ACTION Name of beneficiary of Delegation Agreement: International Trade Centre (ITC) Title of Action: Trade-Related Assistance for Afghanistan EC CRIS Number: ACA/2016/ Start and end date of reporting period: 12 August June 2017 Background The Government of Islamic Republic of Afghanistan (GIRoA) recognises international trade as an important driver of growth, for which it has prioritized trade, transit, and regional cooperation as critical elements in its economic development strategy. It is committed to trade reforms aimed at unlocking the potential of the country's export sector, which is evident from recent initiatives undertaken by the country such as accession to the World Trade Organization (WTO) and ratification of WTO Trade Facilitation Agreement (TFA). However, this changing trade environment requires solid understanding of trade issues, design and implementation of legislative reforms and their enforcement through institutionalized mechanisms. The three-year project, funded by the European Union(EU), worth EUR , will assist the GIRoA in improving the conditions to use trade as a lever for confidence building, enhanced regional cooperation, economic and human development and poverty reduction. It aims to strengthen human and institutional capacity on trade policy and strategy formulation and implementation with the active engagement of the private sector. The project, which is in line with Afghanistan National Peace and Development Framework (ANPDF) , started in August 2016 and will run until August The projects takes into account the country-specific needs of Afghanistan related to enhanced regional trade cooperation, particularly taking into account the focus of both the Regional Economic Cooperation Conference on Afghanistan (RECCA) and the Heart of Asia Process on positioning Afghanistan as a regional trade hub in Central Asia and promoting enhanced regional cooperation. The project is being executed under the Asia Regional Multiannual Indicative Programme In line with the Agenda for Change, EU regional programmes aim at supporting a broad-based process of dialogue and collaboration between Central Asian countries, promoting an environment conducive to a nonconfrontational approach within the region, notably in areas sensitive to overall political and social instability. Project partners and beneficiaries The Ministry of Commerce and Industry (MoCI) is in charge of trade policy formulation/trade negotiations in Afghanistan and is the main counterpart and beneficiary of this project. National institutions and agencies such as the Afghanistan Chamber of Commerce and Industry (ACCI), Afghanistan National Standards Authority (ANSA), Ministry of Agriculture, Irrigation and Livestock (MAIL), sectoral trade and investment support organizations, universities and research institutions, the private sector and non-governmental partners also contribute to and benefit from various project activities. Project objectives The foreseen impact is enhanced trade and regional integration of Afghanistan as a lever for confidence building, economic and human development and poverty reduction. It is through strengthening institutional capacity to formulate and implement effective trade policies and strategies with a special focus on regional cooperation, engaging private sector to participate in trade policy reforms and dialogue, and building sustainable mechanisms to invest in human capital and to ensure local ownership, that this is being advanced. Results expected from the project National Export Strategy (NES) design - The GIRoA owns a NES and action plan that was developed in a consultative process with the private sector and has started its implementation. 5

6 - The NES analyses the country s needs, constraints and opportunities (especially in the regional markets) to provide a well-articulated roadmap to strengthen Afghanistan s supply and export capacities, implement trade reforms, identify regional partners and potential investment opportunities and address Small and Medium Enterpirses (SMEs ) knowledge of cross-border procedures. The NES implementation commences with a focus on quality management, Sanitary and Phytosanitary (SPS) measures and regional regulatory cooperation: - National public and private stakeholders are enabled to manage and coordinate the implementation of the NES and mobilize support to implement the validated roadmaps. - Priority interventions identified during the NES design process are implemented to improve regional integration and international trade competitiveness. Trade Policy and Facilitation - Capacity building on trade policy: Knowledge-sharing mechanisms for Afghan policymakers on trade policy and negotiation formulation and implementation are established in partnership with a training institute from the region. Ove 50 national policymakers will be trained. - National Trade Facilitation Committee (NTFC) strengthening: Institutional mechanisms to facilitate the implementation of the TFA are operationalized and trained and linked with regional partners. - SME Training: Knowledge of SMEs on how to manage cross-border procedures and compliance with regional and/or global market requirements is built (building on NES findings to include priority markets). - Consultation process: Public-private consultation processes on most pressing trade, regulatory or negotiation issues (domestic or regional) are strengthened. 2. EXECUTIVE SUMMARY OF THE ACTION 2.1 Project Coordination and Management The project launch event was organized on 29 November 2016 in Kabul jointly with the Delegation of the EU to Afghanistan and the MoCI. The project office in Kabul was set up to ensure the day-to-day coordination of project implementation. The project management structure was established. Terms of reference (TORs) for a project steering committee (PSC) have been produced and shared with European Delegation to Afghanistan (EUD) and MoCI which cleared it. In addition, a structure for regular quarterly reporting (two quarterly reports have been carried out and shared) was established as well as a yearly progress report template designed and approved by the EUD. In line with the project communication and visibility plan, the design of project communication tools was initiated and completed, including project flyer, PowerPoint presentation (PPT), website, newsletter (first issue released), social media (Facebook group, regularly tweeting on both Facebook and Twitter). The project was also promoted through extensive media coverage of key events, including the project launch, first symposium of the NES of Afghanistan, national workshop on the implementation of the WTO TFA and the partnership between the Centre for WTO Studies (CWS) and MoCI. 6

7 2.2 Output 1: GIRoA owns a national export strategy and action plan that was developed in a consultative process with the private sector, and has started its implementation Preliminary audits and analysis of Afghanistan s trade competitiveness, development agenda, and key trade support institutions (TSI) were performed. An initial assessment and strategic findings were debated and further refined through a series of Kabul-based and provincial large consultations where over 220 public and private actors reached consensus on priority sectors main competitiveness issues and essential interventions. During the NES design phase quality management and SPS measures were confirmed as highly sensitive and priority issues. An initial review of the quality and SPS institutions along with a series of bilateral meetings, consultations and capacity building workshops were held. A first road map for upgrading the quality and SPS infrastructure was drafted and is currently being further finalised. Factory visits coupled with interviews of international buyers contributed to sharpen the initial assessment and strategic considerations. Subsequently, a NES Response Paper was produced to present the business case for developing Afghanistan s NES. This paper exposes the full spectrum of constraints impeding export development in Afghanistan through applying a degree of prioritization. It suggests a strategic process and framework to spur export-oriented development while also reducing dependence on imports. This response paper puts forward a list of priority sectors and trade support functions to focus on. It was developed under the co-leadership of the MoCI and ACCI, in close collaboration with MAIL and ANSA, and with the technical support of ITC. While the NES response paper remains to be formally endorsed and submitted to the High Economic Council (HEC), the industry level value chain analysis has begun. Similarly, additional sector-specific provincial consultations in Herat and Kandahar are being planned and organised. Short-term outcomes: - Improved public and private dialogue supporting the development of a national export culture. - Empowered national stakeholders capable of contributing to export policy design activities. - Large consensus reached on key competitiveness issues and sector-specific priorities. - Enhanced awareness of available options for export development and how to mainstream trade into national planning and policies. - Stakeholders perceives as a priority and joint efforts of the public and private sector the need to address quality and SPS issues and build a conductive technical environment. Next steps for year 2: - Consolidate, finalise and translate the NES document (consolidation, editing, formatting and its plans of action. - Organise Launching event for official endorsement of the NES by the Government of Afghanistan. - Kick-start implementation of priority interventions identified throughout the National Export Strategy design process. 2.3 Output 2: National public and private stakeholders are enabled to manage and coordinate the implementation of the National Export Strategy and mobilise support to implement the validated roadmaps The MoCI Deputy Minister (DM), was appointed to be the NES Navigator and will maintain ultimate responsibility for the strategy design process. The NES Core-Team, composed of top 20 public and private sector organisations involved in trade-related issues and in charge of providing operational oversight during the NES design phase, met and forged consensus on the key objectives and milestones (under the chair of MoCI DM and ACCI Chief Executive Officer (CEO). The NES secretariat was formed within EPAA to attend to daily operational work required for the design of the NES. Both structures remain to be formalised in order to be fully operational. 7

8 Key international development partners were fully apprised on all aspect of the NES design and implementation phases through an unprecedented Donor Coordination Meeting with United States Agency for International Development (USAID), EU, DFID, EU, BMZ, German Development Agency (GIZ), Food and Agriculture Organization (FAO), UNCTAD, United Nations Assistance Mission in Afghanistan (UNAMA) followed by bilateral consultations. Consensus was reached on the need to formalize the Donor Coordination Group and on the fact that the NES framework provides a robust conduit for joining forces on trade-related issues. This is since it offers national and international development partners with the proper implementation plan and framework as well as favourable conditions for operation (i.e. political endorsement, private sector buy-in and donors/international organisation collaboration). Participants agreed that resource mobilization efforts should be developed in line with the draft strategies plans of action to facilitate, leverage and strengthen diverse sources of financing to support sustainable and inclusive implementation. High-level bilateral meetings (e.g. with MoCI and MAIL ministers, senior advisor to President, ANSA Director General(DG), ACCI s CW(CEO) and Head of HEC Secretariat) were organized to sensitize key decision makers on the NES process and ensure that it serves the New Development Planning System as well as remains in line with parallel and related plans and policies. The online Strategy Implementation Management Tool (SIMT) has been tailored to the needs and capacity of MoCI. The SIMT aims to support the national partners and the designated secretariat, as well as all concerned partners involved in monitoring, managing, and promoting strategy implementation according to their specific roles and responsibilities. Short-term outcomes: - Awareness raised and initial conditions set towards the operationalization of an adequate governance structure to build the required collaboration and coordination (between national and sectoral public and private implementing institutions) to secure NES endorsement and implementation. - MoCI perceives the NES as an instrument to improve the ability of the country to receive and utilize Aid-for-Trade: Identifying, prioritizing and allocating resources, including development partners outreach, to successfully activate NES implementation. - Awareness raised and initial conditions set to set-up and enable an interactive strategy management system to effectively monitor NES progress, assess impact, identify gaps and duplications, and measure results. Next steps for year 2: - Support the MoCI and other stakeholders with capacity- building trainings, direct support and tools on NES implementation planning, management techniques and resource mobilisation. 2.4 Output 3: Priority interventions identified during the National Export Strategy design process are implemented to improve regional integration and international trade competitiveness The outcome of the preliminary assessment of the quality and SPS institutions, bilateral meetings and consultation with the public and private stakeholders confirmed quality and SPS as issues that hamper exports and identified a set of priorities to be addressed within the NES. An initial priority action plan was agreed with ANSA DG with a special focus on standardization, technical regulations, conformity assessment and in particular certification, metrology, training capacity. The first set of capacity building workshops are being prepared and delivered. Other priorities, in particular regarding SPS, food safety, plant health and animal health are confirmed and are being implemented in parallel with the development of the NES. 8

9 Short-term outcomes: - Awareness raised towards the difference between mandatory and voluntary standards, and initial conditions required to comply with international requirements and be competitive. - ANSA is perceived as a critical institution for compliance with WTO post-accession commitments and needed to support exporters. - Stakeholders confirmed the need for cooperation and collaboration between ANSA, MAIL, Ministry of Public Health (MoPH) and MOCI and other related quality-sps institutions and strengthening of their roles and responsibilities to support and facilitate formal trade. Next steps for year 2: - Capacity building on standards development, adoption and promotion. - Capacity building on technical regulations. - Capacity building for Development of training of trainers programme and curriculum for ANSA staff and cascading of training course on ISO standards. 2.5 Output 4: Knowledge sharing mechanisms for GIRoA staff on trade policy/negotiation formulation and implementation are established in partnership with a training institute from the region A partnership arrangement between MoCI and CWS, was conducted. It was agreed that CWS would deliver a training program over an approximately two-year period commencing in April 2017 and end not later than 30 June 2019, on trade policy formulation, implementation, and trade negotiations to build the capacity building of MoCI and other trade-related ministries and implementing agencies/government officers. CWS and MoCI will work together so as to ensure local ownership for the training programme is built so that it can be implemented locally following the involvement of CWS. The agreement is significant given CWS s reputation as a leading training and research institute and MoCI s desire to augment its technical capacities in these areas. In order to formalise the partnership arrangement officials from both MoCI, CWS and ITC met on 31 March, 2017, New Delhi, India. At the meeting, officials were able to agree upon the modalities of work between the three organisations and the work plan. It was agreed that the programme will cover, amongst other things, trade analysis, trade diplomacy, trade litigation and professional monitoring of compliance and effects of trade agreements. In-class training will be followed up by an on the job coaching providing targeted support to the participating officers. By the end of the programme, participants will be expected to have enhanced their understanding of the professional skills in these areas. As a first activity, a need assessment was initiated of the current level of technical capacities of the country s officers in responding to multilateral, regional and bilateral obligations stemming from WTO and other trade agreements. In addition, gaps were identified in the skills of officers and institutions in formulating, coordinating and implementing trade policy/regulatory reforms and preparing for and conducting trade negotiations. The needs assessment is currently in progress in consultation with MoCI and upon their feedback and agreement, training curriculum will be tailor made to address the outcome of the need assessment. Short-term outcomes: - Development of linkage with leading regional institute. - Details of training programmes being designed with needs clearly pre-defined. Next steps for year 2: 9

10 - Finalization of needs assessment and development of tailor-made learning materials. - Execution of year-long training programme for Afghan government officials. 2.6 Output 5: Institutional mechanisms to facilitate the implementation of the TFA are established at national level and linked with regional partners At the time of developing the project, the activities in this output focussed on establishing and operationalizing Afghanistan s National Trade Facilitation Committee (NTFC), the establishment of which is a mandatory requirement of the WTO TFA. However, by the time the project started, Afghanistan had already established a NTFC in the form of the Inter-Ministerial Committee on WTO and TF (IMCWTF). The institutional arrangements governing the committee (such as terms of reference, membership, governance, timetable etc.), which the project was designed to implement, were already in place. ITC s trade facilitation experts accordingly needed to revisit the project s design and consider new activities that would have the maximum impact in the country. During the launch event, a needs assessment was carried out with various national stakeholders to design new activities that could be funded by the budget freed up by the redundant activities. The re-designed activities will aim to support the operationalization of the IMCWTF in order to raise awareness of the TFA in public and private sectors and implement it. These activities, detailed below, were agreed upon in a meeting between MoCI and ITC in Kabul and will be implemented during the duration of the project. Activity 5.1: Support the implementation of the WTO TFA through technical advisory services to IMCWTF and other government agencies - Assist the IMCWTF on the categorization of TFA measures and validate results - Support MoCI WTO Wing to notify Category A commitments to the WTO - Develop a trade facilitation implementation strategy including validation by IMCWTF and NES core team - Support the development of project proposals for Category C measures of the WTO TFA Activity 5.2: Support the capacity building and operationalization of IMCWTF and other public sector agencies to implement the WTF TFA - Development of a concept note on best practices in establishing and operationalizing an NTFC - Development of a work plan for the IMCWTF - Support establishment of working groups (if needed) - Provide training to IMCWTF and other agencies to support implementation of WTO TFA - Support the functioning of IMCWTF (operational and technical) on need basis - Participation of IMCWTF members to regional and multilateral events and/or study tours Activity 5.3: Increase awareness of private stakeholders on the TFA and their ability to contribute to TFA related Public Private Dialogue (PPD within the IMCWTF and other fora) - Adapt and translate all training material to the needs of Afghanistan - Development of train-the-trainer module for the training and translate in local languages - Establish institutional arrangement with ACCI to train their trainers and deliver three-day workshops in 5 provinces in Afghanistan Activity 5.4: Structure and facilitate a regional network of (existing) NTFC to encourage experience sharing as well as a coordinated and harmonized approach towards the implementation of the TFA 10

11 - Review the institutional setting of the regional trade facilitation cooperation mechanism: ToR, governance, accountability, membership, sustainable funding mechanisms, etc. and issue a policy advisory note - Establish communication channels between existing NTFC through contact sharing and videoconferences with NTFCs in neighbouring countries - Support the operationalization of the Regional Trade Facilitation Committee (RTFCM) through the organization of a regional meeting including private sector participation - Support the development of recommendations for regionally harmonized and integrated implementation of cross-border simplification reforms in the region The changes in the activities have been made to ensure that there will be no resulting changes in the output s indicators. For Activity 5.1, ITC realized that there were many similarities with the planned activities of the USAID s Afghanistan Trade and Revenue project. Upon further consultations with USAID, synergies have been advanced with agreements made on collaborating to implement the activities together. The cost-savings will be used to provide further ad-hoc technical support in the second and third years of the project to implement the WTO TFA. Short terms outcomes - Awareness raised of the MoCI and members of the IMCWTF on the WTO TFA. - Conducted first round of categorizations of the measures of the WTO TFA which is the first step to comply with WTO. These are currently being assessed through desk research and face-to-face interviews in Kabul and will be validated by the IMCWTF technical and high-level committees on July in a joint ITC-USAID workshop. - Finalized scope with and currently recruiting a trade facilitation expert to develop the trade facilitation strategy for Afghanistan. - Finalized scope with ACCI on a train-the-trainer programme to train SMEs on the compliance with and benefits of WTO TFA. The MOU between ACCI and ITC is currently being finalized and the ToT event will be held in September. - Adapted ITC s SME training package on TFA to Afghanistan s context. Next steps in year 2 - Finalization of categorizations and support to notify commitments to WTO. - Develop the trade facilitation implementation strategy and action plan for IMCWTF to implement the WTO TFA. - Capacity building workshops of IMCWTF and other public and private stakeholders to implement the WTO TFA. - Signing of MOU and training of ACCI trainers to deliver private sector trainings in 5 provinces. - Groundwork for regional workshops and development of project proposals for Category C measures. 2.7 Output 6: SME knowledge of how to manage national cross-border procedures and compliance with regional and/or global market requirements is built encompassing priority markets (building on NES findings) The progress under this output has mainly been to complete all the preparatory work that was required before the training curriculums can be applied for the capacity building of SMEs and other private sector representatives. This includes the development of export management guides for selected sectors, the selection of sectors, the development of cross-sector export management training curriculums and the development of train-the-trainer methodologies and coaching kits. Once the above material is fully developed, it will be translated to Pashto and Dari and disseminated widely. 11

12 In terms of the scope of the activities, they are the same except that the e-learning methodologies will be replaced by face-to-face training based on initial discussions with MoCI and other local stakeholders. Short terms outcomes - Developed templates for export management guides including finalization of Afghanistan s key export sectors. - Developed 5 export management guides (one for each key export sector) containing all steps, procedures and requirements to successfully export. These are currently being reviewed. - Developed cross-sector train-the-trainer methodology and coaching kit to benefit the compliance levels of SMEs. Next steps in year 2 - Finalization, validation, translation, publication and dissemination of sector specific export management guides. - Finalization of export management training curriculum with sector specific content on key export sectors. - Selection of local partner organization to conduct trainings widely in Afghanistan and sign MOU - Deliver trainings in different provinces in Afghanistan. 2.8 Output 7: Public-private consultation process on domestic/regional key pressing trade policy/regulatory/negotiation issues is strengthened Under this output, the main developments are two-fold: Upon the specific request of MoCI, the main consultation process that has been initiated is a process to develop an Afghanistan National Trade Policy (ANTP). At the outset, ITC, in consultation with MoCI, developed a six to eight-month work plan to develop the policy document. Following extensive fact-finding and a review of policy related documents as well as previously drafted national trade policy documents, ITC has developed a first draft version of the ANTP using an ITC developed methodology which assesses trade policy instruments that impact each stage of the supply chain. ITC first version of the policy document has subsequently been reviewed by MoCI. The changes have been incorporated in a second draft conveyed to MoCI. The document is currently with MoCI for further review. Ultimately, it is expected that it will feed the HEC for discussion across Ministries. In particular, attention has been on ensuring that recommendations included in the documents are in line with the Ministries mandate. A stakeholder meeting is being planned to occur in August, 2017, which will further inform the drafting process. It was further confirmed that the project will support regular bilateral stakeholder consultation between Afghanistan and Iran (or alternatively Afghanistan and Uzbekistan) aimed at enhancing trading relations. ITC recommended and subsequently gained the approval for the methodology/timeframes for undertaking bilateral PPDs, intended to occur over the next two-year period. Much ground work, needs analysis, consultation with stakeholders and their endorsement was undertaken to confirm this key direction. The initiative has been appreciated due to its timely relevance, focus on evidence-based research, bringing key stakeholders together and generation of key recommendations. Short-term outcomes - Substantial progress related to drafting on ANTP. 12

13 - Identification and stakeholder support for priority bilateral trade dialogues to enhance Afghanistan s regional trade initiated. Next steps in year 2 - Stakeholder consultation meeting on ANTP, further incorporation of comments and finalisation. - Follow-up on recommendations generated through ANTP through key channels. - Commencement of bilateral stakeholder consultations Afghanistan and Iran (or alternatively Afghanistan and Uzbekistan) - which is informed by evidenced based research. 3. ACTUAL RESULTS Targets Actual Objectives Project indicators Baseline (16 Aug Aug Aug Jun 2017 Status Means verification of Legend On track Some delay Delay Impact: Enhanced trade and regional trade integration of the Islamic Republic of Afghanistan as a lever for confidence building, economic and human development and poverty reduction. Increase in Afghanistan's international trade value and volume On track. To be carried out in second and third years of the project. Baseline figures still to be determined Increase in Afghanistan's regional trade value and volume On track. To be carried out in second and third years of the project. Baseline figures still to be determined 13

14 Targets Actual Objectives Project indicators Baseline (16 Aug Aug Aug Jun 2017 Status Means verification of Legend On track Some delay Delay Delivery of confidence building measures Curriculum Based Measurement (CBM) included in the implementation plan of the Heart of Asia process (Dec 2013) for the six key CBM applied by the GIRoA On track. To be carried out in second and third years of the project. Baseline figures still to be determined Number of decisions taken by the GIRoA to improve trade services for exporters and investors as a consequence of the project (project end) 0 10 On track. To be carried out in second and third years of the project Outcome: The Government formulates and implements better-informed trade policy and a strategic vision to support trade competitiveness within the region. Number of TSI's improving their performance in relation to NES development, trade facilitation, and quality support 0 5 On track. To be carried out in second and third years of the project Number of policy and regulatory measures initiated by the GIRoA for improving the business environment for exporters and investors as a consequence of the project 0 5 On track. To be carried out in second and third years of the project 14

15 Targets Actual Objectives Project indicators Baseline (16 Aug Aug Aug Jun 2017 Status Means verification of Legend On track Some delay Delay Percentage of Afghan business stakeholders reporting satisfaction about trade policy and Public Private consultation process 0 20 On track. To be carried out in second and third years of the project Number of measures implemented by the GIRoA to improve trade services for exporters and investors as a consequence of the project (project end) 0 5 On track. To be carried out in second and third years of the project Output 1: GIRoA owns a NES and action plan that was developed in a consultative process with the private sector, and has started Endorsed NES document, including individual sector and functional strategies, in place 0 1 NES Concept note, NES response 15

16 Targets Actual Objectives Project indicators Baseline (16 Aug Aug Aug Jun 2017 Status Means verification of Legend On track Some delay Delay its implementation Number of official GIRoA NES launch events jointly with private sector representatives of such entities as ACCI and Afghanistan Investment Support Agency (AISA) 0 1 Media articles press Number of publicprivate NES stakeholder consultations completed On track Missions and consultations documented reports Number of participants to NES workshops On track Participants lists and consultation s report Number of female participants to NES workshops On track Participants lists and consultation s report Number of research and advice provided in relation to the NES development On track NES Concept note, NES Response paper, EPI. Output 2: National public and private stakeholders are enabled to manage and coordinate the implementation of High-level National Export Development Council, or similar, established. 0 1 On track. To be carried out in second and third years of the project 16

17 Targets Actual Objectives Project indicators Baseline (16 Aug Aug Aug Jun 2017 Status Means verification of Legend On track Some delay Delay the NES and mobilise support to implement the validated roadmaps NES implementation management unit (secretariat) operationalized 0 1 On track. To be carried out in second and third years of the project Number of NES Implementation Management training's completed 0 4 On track. To be carried out in second and third years of the project Number of participants to NES Implementation Management trainings 0 40 On track. To be carried out in second and third years of the project Number of female participants to NES Implementation Management training 0 13 On track. To be carried out in second and third years of the project Output 3. Priority interventions identified during the National Export Strategy design process are implemented to improve regional integration and international trade competitiveness Number of priority initiatives in Quality and SPS areas approved Number of initiatives in Quality and SPS areas completed On track. 0 4 On track. To be carried out in second and third years of the project. ANSA Workplan 17

18 Targets Actual Objectives Project indicators Baseline (16 Aug Aug Aug Jun 2017 Status Means verification of Legend On track Some delay Delay Number of trainings delivered to identified institutions On track. 1 event conducted on 15&18 February 2017; 3 events planned on 4-5 July, on 8 July and on 9 July 2017; others to be carried out in second and third years of the project. Number of advisory services provided to implement the identified priority interventions 0 3 On track. 2 advisory services advanced on the development of Procedures on development of standards and Technical Regulations Development and others to be carried out in second and third years of the project Output 4: Knowledge sharing mechanisms for GIRoA staff on trade policy/negotiation formulation and implementation are established in partnership with a training institute from the Region Partnership with training institution from the region is established Number of training modules/material produced Completed 0 7 Some delays in conducting needs assessment. Results to be attained in second and third years of the project Press release, Contract between CWS and ITC 18

19 Targets Actual Objectives Project indicators Baseline (16 Aug Aug Aug Jun 2017 Status Means verification of Legend On track Some delay Delay Number of Afghan participants successfully passing trainers' assessment 0 40 Some delays in conducting needs assessment. Results to be attained in second and third years of the project. First training to be held in August 2017 Number of Afghan participants (women) successfully passing trainers' assessment 0 10 Some delays in conducting needs assessment. Results to be attained in second and third years of the project. First training to be held in August 2017 Number of trainers and/or regional resource persons trained 0 2 Some delays in conducting needs assessment. Results to be attained in second and third years of the project. First training to be held in August 2017 Output 5: Institutional mechanisms to facilitate the implementation of the TFA are established at national level and linked with regional partners Recommendation for the establishment of a NTFC issued and endorsed by the MoC Number of public and private sector representatives stating increased awareness on the WTO TFA and trade facilitation reforms 0 1 Completed In progress Concept note distributed to new IMCWTF leadership Attendance sheet from categorization event 19

20 Targets Actual Objectives Project indicators Baseline (16 Aug Aug Aug Jun 2017 Status Means verification of Legend On track Some delay Delay Number of participants from public and private institutions to regional events in the area of trade facilitation (project end) On track. To be carried out in second and third years of the project Number of female participants from public and private institutions to regional events in the area of trade facilitation On track. To be carried out in second and third years of the project Number of regional events in the area of trade facilitation On track. To be carried out in second and third years of the project Output 6: SME knowledge of how to manage national crossborder procedures and compliance with regional and/or global market requirements is built encompassing priority markets (building on NES findings) Number of private sector representatives who participated in the export management curriculum and pass knowledge tests On track. Preparatory work being done that will contribute to this indicator. 20

21 Targets Actual Objectives Project indicators Baseline (16 Aug Aug Aug Jun 2017 Status Means verification of Legend On track Some delay Delay Trainers are trained On track. Preparatory work being done that will contribute to this indicator. National Trade Facilitation procedure guide published On track. Preparatory work being done that will contribute to this indicator. Number of publicprivate dialogues/trainings held 0 8 Some delays to initiate PPDs. Results to be attained in second and third years of the project Output 7: Public-private consultation process on domestic/regional key pressing trade policy/regulatory/ negotiation issues is strengthened Number of policy research/material produced In progress PPD diagnostic study, Draft of the ANTP ( ) Number of recommendations stemming from PPD 0 10 Some delays to initiate PPDs. Results to be attained in second and third years of the project 21

22 4. ACTIVITIES CARRIED OUT DURING THE REPORTING PERIOD Project coordination and management Activity Date/location Main Achievements Project launch event Project management Set-up of project office Finalization of the project communication and visibility plan 29 November 2016 Kabul Ongoing February - June Kabul/Geneva June June The project launch event was organized on 29 November 2016, in Kabul jointly with the EUD Afghanistan and MoCI. - More than 40 participants from both the public and private sectors attended the event, which was publicized to the population through more than 9 media services reporting the event in the media. - More than 50 meetings took place with national project partners and stakeholders in the margins of the project launch event in order to kick-off the project implementation. - The terms of reference of the PSC including its composition, roles and responsibilities were finalised and approved by MoCI and the EUD. - 2 quarterly snapshot progress reports were completed and shared with the EUD and MoCI in March and June respectively. - A template for annual progress reporting was developed and approved. - A stakeholder contact list (both national and regional) was developed. - 2 national staff i.e. a National Project Coordinator and a National Administrative Assistant were recruited by ITC. - The project office in Kabul was set up and is located in the United Nations Office for the Coordination of Humanitarian and Economic Assistance Programmes relating to Afghanistan (UNOCA) complex. - Project equipment items were procured with some items still in process. - Project Communication and Visibility Plan was finalized before project start. - Project communication tools were designed and validated by the EU. - Database of media produced for effective promotion of the project within Afghanistan and to the civil society. - Project website and Facebook group were designed and are in operation. - First project newsletter was developed and widely disseminated. 22

23 Project launch event - A number of press releases were produced and disseminated nationally and regionally. The project was launched on 29 November 2016 in Kabul. More than 40 participants attended the event from the public and private sectors as well as the media. The project was officially launched by: - H.E. Minister Humayoon Rasaw, MoCI, Afghanistan - H.E. Ambassador Franz-Michael Mellbin, Head of EU Delegation to Afghanistan - Mr. Jean-Sébastien Roure, Project Manager, ITC Mr Jean-Sébastien Roure made a presentation about the project design process, objectives and expected results. Similarly, each of the output heads made presentations on their interventions related to NES, trade policy and quality management. Mr. Maurizio Cian, Head of Cooperation, EUD Afghanistan and H.E. Deputy Minister for Commerce Mohammad Qurban Haqjo, MoCI, Afghanistan made closing remarks. The launch event was widely covered by national media, including newspapers and web news. More than 9 news articles reported the launch of the project. In the margins of the project launch event, more than 50 meetings took place with national project partners and stakeholders in order to kick-off project implementation. The main overall mission takeaways included: - Good visibility achieved through the holding of the project launch event. - Appraised senior representatives of public and private sector organizations and briefed corestakeholders on the all components of the project. - Policy recommendations developed through the project will need to be conveyed to the HEC with the support of MoCI, which is the key decision-making body for the private sector development area. - Endorsement of MoCI obtained on the approach suggested for the capacity building approach of the project (main beneficiary). - Workplan for year 1 completed. A complete launch event report along with press release and PPT presentations were produced and shared with MoCI and the EUD. Project management The terms of reference of the PSC including its composition, roles and responsibilities were finalised and approved by the MoCI and the EUD. The intended overall purpose of the PSC is to ensure that the project maintains coherence with the national development and trade priorities of Afghanistan and to provide strategic direction and oversight for the implementation of the project. The PSC also facilitates the alignment of the project with other major trade initiatives undertaken in Afghanistan, reviews the project implementation strategy and advises the implementation team on strategic priorities, endorses annual work plan, reviews the performance of the project against the work plan and the project logical framework and makes recommendations for adjustments as relevant. Two quarterly snapshot progress reports were completed and shared with the MoCI, EUD and other key stakeholders in March and June respectively. The reports provided an overview of progress on project implementation and included the following sections: Coordination and management; updates per output area (progress and next steps); trade learning; media coverage (press and social media) and support required from MoCI and other stakeholders. In preparation for yearly PSC meetings, ITC developed a template, which was approved by the EUD in Kabul. In developing the template, ITC followed the guidance indicated in the delegation agreement. 23

24 Set up of the national project office The national project office was set-up in Kabul and has been in operation since April The project office in Kabul is located in the UNOCA complex. It is responsible for coordination and management of the day-today project operations, as well as providing the necessary technical support to activity implementation. Two members of team i.e. a National Project Coordinator (NPC) and a National Administrative Assistant (NAA), were recruited by ITC and started operation in April and June 2017, respectively. The NPC manages the project office and assumes responsibility for the efficient and effective day-to-day functioning of the office. He manages the relationships with EU Delegation and ensures ownership of other local stakeholders, national project partners, and beneficiaries in Kabul and provinces. He also provides technical inputs required by the project team and experts, provides guidance and identifies risks to project implementation and proposes mitigation actions. The NAA provides various administrative supports to ensure the effective and efficient running of project events, missions, and workshops as well as day-to-day management of the project office. The procurement of the necessary equipment including office furniture, IT equipment has been undertaken by ITC in collaboration with UNDP for the respective staffs and experts under their responsibility. Project communication and visibility The project communication and visibility plan was produced prior to project start. It specifies the objectives, responsibilities, communication principles and target groups for project communication. The plan also defines the main communication activities that should take place during project implementation, as well as the tools to be created for the effective promotion of the project. Various communication tools, including project flyer, quarterly newsletter, social media (twitter/facebook), press releases, website, communication templates for project activities, Facebook group page were implemented. The tools were designed to ensure the visibility of the EUD, MoCI, and ITC by displaying the names and logos of the organizations. All communication tools are in line with EU and ITC corporate/organization-wide communication guidelines and requirements. For more details on media coverage please see Annex I of the report. A database of media was also developed, to reach out to the national, regional and international media based in Kabul and the wider region to promote project activities. 24

25 4.1 OUTPUT 1: GIRoA owns a national export strategy and action plan that was developed in a consultative process with the private sector, and has started its implementation Activity Date/location Main Achievements 1.1: Establishing October/November Preliminary conditions strategy design 2016 set towards the and operationalization of implementation Kabul adequate governance management structures for the NES structures - NES design phase. Initial pre-engagement buy-in from MoCI and mission other key private/public stakeholders secured. 1.2: Analysis of Afghanistan s trade competitiveness, development agenda, existing trade-related programmes, and key TSI Structured faceto-face or Skype interviews with diaspora and international buyers-traders 1.3: Inauguration and first stakeholders consultation of Afghanistan s NES November February 2017 Kabul and Geneva Q1-Q Geneva, Dubai Istanbul, February 2017 Intercontinental Hotel, Kabul A detailed assessment of Afghanistan s economic-trade performance and institutional landscape and identification of potential priority sectors. These preliminary audits contributed to ensure: - NES Strategic thought leadership - Policy convergence - Institutional coordination - International agencies cooperation Buyers requirements (in terms of buying cycles, quality standards, food safety, packaging, prices etc.) and feedback of most critical areas of improvement for Afghan products embedded into the strategy s recommendations and plans of action. Concrete support and endorsement from key political leaders. Unprecedented turnout and P&P dialogue: Over 180 P&P Contributing to Indicator SUB-IND: 1.3: Number of public-private NES stakeholder consultations completed: 1 (First NES Core Team meeting) SUB-IND 1.4: Number of research and advice provided in relation to the NES development: 1 (These initial analyses are part of research and advice provided in relation to the NES development) SUB-IND 1. 4: Number of research and advice provided in relation to the NES development: 1 SUB-IND 1. 4: Number of research and advice provided in relation to the NES development: 1 SUB-IND 1. 6: Number of research and advice 25

26 participants on both days. provided in relation to the NES development: 1 1.4: Elaboration of Afghanistan s NES Response Paper February - May 2017 Geneva and Kabul Consensus reached on key competitiveness issues (special emphasis on quality/sps management) as well as on sector-specific priorities. Key competitiveness issues (and their root causes), priority sectors and strategic trade support functions identified and prioritised. The paper recommends a strategic process and framework for the design of the NES. First official GIRoA NES launch event jointly with the private sector. Such a highlevel, highly visible, inclusive and productive consultation also contributed to the final endorsement of the strategy. SUB-IND 1. 6: Number of research and advice provided in relation to the NES development: 1 (Part of the NES endorsement process. Key advice provided in relation to the NES development.) 1.5 & 1.6: Mapping of the institutions and preliminary review of the Quality and SPS Infrastructures December February 2017 Initial review of the legal framework, mapping of the institutions with their roles and responsibilities and draft road map for strengthening the quality and SPS infrastructures SUB-IND 1. 4: Number of research and advice provided in relation to the NES development: 1 (This initial analysis is part of the NES design process and helped confirm the priorities to implement in the quality area) 1.7: Provincial NES stakeholders consultation in Mazar-e-Sharif and in- factory supply chain assessment May 2017 Mazar-e-Sharif Consensus obtained on key provincial constraints and related priority activities for the Balkh province. Supply chain assessments to gain further knowledge on key issues: quality process/procedures, Hazard Analysis and Critical Control Point (HACCP) compliance, ISO certification, technical and managerial skills, access to raw materials, packaging, in market-support and trade across borders. SUB-IND 1. 4: Number of research and advice provided in relation to the NES development: 1 SUB-IND 1. 6: Number of research and advice provided in relation to the NES development: 1 This inclusive provincial consultation also contributed to the final endorsement of the strategy. 26

27 Activity 1.1: Establishing strategy design and implementation management structures and continued guidance/support to formalize and operationalise strategy implementation management mechanisms (Public-Private Development Partnership (PPDP), secretariat, etc.) Title Location Implementing partners Background/ context NES Pre-engagement mission to support the setup of the NES design structures (Navigator, Core Team, secretariat, etc.) as well as to secure P&P buy-in and support Kabul ITC, MoCI, ACCI As important as the content of the strategy is the process by which it is reached. The key to this process is national ownership, both from the public and private stakeholders. The NES design must be able to count on political leadership s buy-in and high-level support emanating from the National Unity Government. Clear ownership and leadership will be a major encouraging factor in progress. Likewise, the implementation phase has to be supported by a fully articulated and institutionally embedded approach. The application of a unified structure for achieving NES objectives regardless of existing political friction is essential. Trade development cuts across ministries, government agencies, sector associations, and other private-sector organizations and requires effective collaboration as a key condition for expanding a country s competitiveness. Therefore, the NES initiative necessitates an adequate governance mechanism that ensures clarity of roles, maximizes utilization of limited resources, assigns responsibilities and accountability, and provides transparency and efficiency through the effective participation of national public institutions and private sector operators. It is proposed that the HEC provides high-level strategic oversight and shepherding of the NES design and implementation. This is to ensure overarching reach and leverage and to avoid the perception that the NES becomes a ministry line initiative. The NES Core team will provide operational oversight during (at least) the NES design phase under the leadership of the NES Navigator. Results Key P&P stakeholders sensitized on all aspects of the NES process; NES Core team, comprised of key ministries and private sector representatives, met (as a body that will lead the NES formulation process, under the overall management of the NES Navigator), and coached on the NES design methodology; Expectations of various stakeholders managed through the provision of a better understanding of roles, duties, and process to be undertaken to support NES initiative. NES navigator identified, appointed (DM Haqjo) and fully briefed on the role and responsibilities of the Navigator. Outline the role, expected duties, and ideal profile of members of the NES Secretariat; NES Secretariat formed (2 EPAA staff appointed by MoCI) to support the NES process. 27

28 The date for 1st NES consultation set for February All technical and organization preparations initiated, related to the organization of the NES 1st stakeholders consultation with NES secretariat. ITC together with the core-team designed a detailed work plan leading up to the beginning of the design phase, and broke down the process into small and achievable tasks to clearly delineate what is intended to be done, by who and by what date. Subsequently, Afghanistan s NES Concept Note was produced. HEC foresaw to provide high-level guidance to the Navigator and the core team relating to the overall NES design process. Meet with relevant regional and international development partners to discuss potential collaboration. Bilateral meetings held and follow-up Skype calls organized with other key stakeholders to promote the NES initiative and build further buy-in and support. Stakeholder/ participant information Overall, over 50 key P&P stakeholders and members of the international community were consulted. Main core team meeting involved 24 decision makers drawn from high-level public and private sector organizations; Meeting chaired by the NES Navigator H.E DM Mohammad Haqjo. The Export Promotion Agency (EPAA) acted as the secretariat. Number of attendees: 24 Number of woman attendees: 2 Ministries and government agencies: 14 Industry associations and enterprise representatives: 10 A full list of attendees is available on demand. Supporting documents Contribution towards programmes indicator s achievement Afghanistan s NES concept note. PPT, NES Core Team s ToR, Work plan, Navigator instruction, NES Secretariat ToRs. SUB-IND: 1.3: Number of public-private NES stakeholder consultations completed: 1 (First NES Core Team meeting) This activity is also an essential initial step contributing to secure the final endorsement of the NES. Likewise, it contributes to raising awareness on the need to establish a high-level National Export Development Council or to have the HEC playing this role. Activity 1.2: Preliminary analysis of trade competitiveness, development agenda, existing trade-related programs, and key trade support institutions Title Location Preliminary analysis of trade competitiveness, development agenda, existing trade-related programs, and key trade support institutions Geneva and Kabul 28

29 Implementing ITC under MoCI and Core Team s leadership partners Background/context An export strategy initiative takes into account other relevant plans, studies and programmes in the country. It builds and aligns itself with existing development efforts in order to capitalize on the momentum generated and to ensure that there is no duplication of efforts but rather the plugging of gaps in the overall development agenda where applicable. In the context of limited resources for implementation of development plans, this focus on alignment rather than duplication is especially relevant. Similarly, an assessment of overall capacities and coordination level of the TSI is required to ensure that the NES brings about tailored recommendations regarding the trade support network s landscape/arrangements and is implemented appropriately. Results Finally, a rigorous evaluation of where the country stands in terms of macro-economic and export performance is a mandatory requisite for any substantial strategic work. Numerous trade and export performance diagnostics were completed by ITC using export potential and product diversification indicators, available national statistical data, and existing reports/studies/surveys. In-depth study of Afghanistan s development agenda to secure alignment with the New Development Planning System delineated in the ANPDF. This will include structural alignment within the system as well as positioning vis-à-vis NPPs. Detailed mapping and assessment of the existing international development efforts in order to capitalize on the momentum generated, avoid duplication and identify strategic adjustments. Specific arrangement designed with the Enhanced Integrated Framework TIER 1 intervention. Preliminary audit of the trade support network that assists exporting and non-exporting enterprises. Assessment of overall capacities and coordination level. Development of an online survey targeting each TSI with the following objective: Supporting documents Contribution towards programmes indicator s achievement - Gauge the depth and breadth of the institution s involvement in trade matters - Assess capacities of the individual institution (specifically in terms of human, technical, financial etc. and key areas of deficit and improvement. - Assess the level, type of coordination between the TSIs. Preliminary audits (trade competitiveness, development agenda, existing trade-related programmes, and key TSI, Export potential indicator table, TSI survey, Afghanistan background information library. SUB-IND 1. 4: Number of research and advice provided in relation to the NES development: 1 SUB-IND 1. 6: Number of research and advice provided in relation to the NES development: 1 29

30 First official GIRoA NES launch event jointly with the private sector. Such a high-level, highly visible, inclusive and productive consultation also contributed to the final endorsement of the strategy. Title Location Implementing partners Background/ context Results Stakeholder/ participant information Supporting documents Contribution towards programmes indicator s achievement Structured face-to-face or Skype interviews with regional and international buyers-traders Istanbul, Geneva, Dubai ITC under MoCI and ACCI s leadership In the case of Afghanistan, private sector development will not be an organic exercise. While the design of the NES will not be dictated by the markets, it will have to be inspired/guided by market dynamics and buyers requirements, whether in the global, regional or domestic spheres. In this regard, ITC interviewed several current or potential trading partners. Structured interviews of regional and international buyers working in strategic sectors for Afghanistan were conducted throughout Q1 and Q2 of The objective was to understand their requirements (in terms of buying cycles, quality standards, food safety, packaging, prices etc.) and the most critical areas of improvement for Afghan products. Strategic market intelligence and insights were collected to feed the NES design process from prominent players such as McCormik, Ducros, Noberasco, Aromatic, Rumi Spice, Frontier Coop and Kefayat group. McCormik, Ducros, Noberasco, Aromatic, Rumi Spice, Frontier Coop, and Kefayat group. Interview questionnaires SUB-IND 1. 4: Number of research and advice provided in relation to the NES development: 1 Activity 1.3: Inauguration event and first national stakeholders consultation will determine the national orientation of the strategy Title Location Implementing partners Background/ context Inauguration and First Stakeholders consultation of Afghanistan s NES Kabul ITC under MoCI and ACCI s leadership The NES inauguration and consultation is the first key milestone of the design process and serves as a platform for public and private stakeholders to discuss the current situation, challenges and advancements relating to the performance of Afghanistan s export sector 30

31 Results in light of value chain conditions, supply capacities and crosscutting competitiveness hurdles, with special emphasis on quality management. The event was held at the Hotel Intercontinental on Feb 20 and 21 under the leadership of MoCI and ACCI: - The event opened by Ministers of Commerce and Agriculture, DM Haqjo, EU Ambassador, ACCI's CEO. Concrete support and endorsement from key political leaders, which bodes well for the rest of the design process. - Unprecedented turnout and P&P dialogue: Over 180 P&P participants on both days, including the presence of SMEs, industry s leaders, influential traders from Kandahar and other provinces, which is a promising indication of the buy-in and support towards the NES. - Approach, format and initial findings were very well received by the participants. A consensus was reached on key crosscutting competitiveness issues (with special emphasis on quality management) as well as on sector-specific priorities. The second day featured intensive sector VC consultations including: - Livestock and Dairy; Handicrafts; Fresh Fruits and Vegetables; Dried fruits and nuts; Saffron; Carpets; Marble Significant media coverage was obtained through the press and television (see section VII below), which proved useful for momentum building for the second consultation. Stakeholder/ participant information The NES first consultation was launched in the presence of MoCI Minister Humayun Rasa, MAIL Minister Assadullah Zamir, EU Ambassador, Franz-Michael Mellbin, NES Navigator DM Mohammad Haqjo and ACCI CEO, Atiqullah Nusrat. The EPAA acted as the operational secretariat. Number of attendees: 182 Number of woman attendees: 16 Ministries and government agencies: 85 Industry associations and enterprise representatives: 97 A full list of attendees is available on demand. Participant evaluation Supporting documents The organization, as well as the substance of the workshop, was well appreciated by the participants. Specifically, the PPD as well as the interaction between multiple sectors and cross-sector group stakeholders, has not been common in Afghanistan, and the format worked well. Additionally, almost all participants indicated their satisfaction for the event and knowledge enhancement on the issues. Evaluation available on-demand. Presentations and tools, dignitaries speeches, press coverage, mission report, key sector outputs. 31

32 Contribution towards programmes indicator s achievement SUB-IND 1. 4: Number of research and advice provided in relation to the NES development: 1 SUB-IND 1. 6: Number of research and advice provided in relation to the NES development: 1 First official GIRoA NES launch event jointly organized with the private sector. The high-level, highly visible, inclusive and productive consultation also contributed to the final endorsement of the strategy as well as forming part of the advice provided in relation to the NES development. Capacity building of MoCI and EPAA staffs in policy and strategy design. Activity 1.4: Preliminary diagnostic and strategic orientations assessment of Afghanistan trade and export competitiveness in a Strategic Trade Roadmap (STR); Validate STR with priority sector selection by national stakeholders and the GIRoA Title Elaboration of Afghanistan s NES Response Paper Location Geneva and Kabul Implementing ITC, MoCI, ACCI, MAIL, ANSA partners Background/context The NES response paper was developed under the co-leadership of the MoCI, ACCI, in close collaboration with MAIL and ANSA. ITC provided technical support to the development of this paper. The NES response paper presents the business case for developing Afghanistan s NES. It is clear that while expectations are high, the trajectory for trade-related-export growth in Afghanistan remains uncertain, and for this precise reason, there is a requirement for a coherent and comprehensive NES that will bring about policy convergence, institutional alignment, and strategic private sector support. Results The NES response paper remains to be approved by the NES Core Team and submitted to the HEC. NES response paper drafted: The findings are based on comprehensive analysis and results from the first NES stakeholders consultation held in Kabul on February This paper reveals the identification of key competitiveness issues (and their root causes) that are impeding the country s exports. It also recommends a strategic process and framework for overcoming these obstacles and provides direction for the design of the NES, including the focus on priority sectors and trade support functions. NES response paper was reviewed by a team chaired by DM Haqjo and composed of Deputy DG ANSA, Director Afghan Women s Business Federation (AWBF), ACCI, EPAA NES Secretariat. Guidance and comments were transmitted to ITC and the document was further refined to reflect main remarks/requests. Participant evaluation The form and substance of the NES response paper was very well received by the NES Navigator DM Haqjo and team. The paper and its 32

33 strategic recommendations were endorsed pending the integration of Core Team s comments and final review/approval. Supporting documents Contribution towards programmes indicator s achievement The NES Response Paper (2 revisions); minutes of the review meeting. SUB-IND 1. 6: Number of research and advice provided in relation to the NES development: 1 (Part of the NES endorsement process. Key advice provided in relation to the NES development.) Activity 1.5: Review of quality and SPS infrastructures & 1.6 Mapping of the institutions and preliminary review of the Quality and SPS Infrastructures Title Location Background/context Review of quality and SPS infrastructures & Mapping of the institutions and preliminary review of the Quality and SPS Infrastructures Geneva and Kabul In order to tackle quality management and food safety highly sensitive issues during the design phase of the NES, a series of meetings and consultations were held. The quality and SPS strategy as cross-strategy of the NES take into account the legal framework, the mapping of the quality and SPS institutions and infrastructures with their gaps and challenges, roles and responsibilities. It looks at the private sector capacity to understand, comply and demonstrate compliance with international standards. It takes into account other relevant studies, plans and programmes in the country and international rules and requirements. NES quality and SPS strategy brings strategic objectives and action plan with detailed strategic tailored recommendations at three level, legal framework/policy; institutions and private sector. As part of the implementation of priority actions capacity building workshops are being conducted in collaboration with ANSA and MAIL that enables to collect further inputs for the NES design (for details see below output 3). Results A literature review was completed; with regard to the policy and legal framework (standardization law, food safety law, pesticide law, veterinary law, plant quarantine regulation, consumer protection law, etc.). It included a detailed review of the studies, reports, outputs of other development assistance interventions related to quality and SPS (i.e. FAO, USAID, UNIDO) to build synergies. The preliminary quality and SPS institutional assessment covered information on structure, roles and responsibilities by functions, initial gaps versus international practices (i.e. standardization, technical regulations, 33

34 SPS, conformity assessment labs, inspection, certification, metrology, accreditation, International representation), of different institutions involved (i.e. ANSA, MAIL, MoPH, MoCI). Inputs were given to the NES Institutional Assessment survey to further collect inputs for the quality and SPS review. It helped to gain a better understanding of the foundation of the infrastructures in particular with regard to standardization, technical regulations, and certification; establish good linkages with stakeholders, and draft a preliminary high-level road map for strengthening the institutions, the NES Standard Trade and Development Roadmap. A list of priorities was agreed with ANSA. Further bilateral consultations with each stakeholder and private sectors also in the provinces are planned to complete the in-depth assessment and actions. Stakeholder/participant information Meetings with high-level officials from ANSA, MAIL, MoPH, Sector associations. Supporting documents Literature Review; Meeting Plan; Comments on NES TSI Survey ; Institutional Assessment Report; Standard Trade and Development Roadmap: Quality Context; ANSA priorities document. Contribution programmes indicator s achievement towards SUB-IND 1. 6: Number of research and advice provided in relation to the NES development: 1 These initial analyses are part of research and advice provided in relation to the NES design - quality component Activity 1.7: Organize second and third national stakeholders consultations on sector and crosssector strategies with plans of actions; Guide and support sector and cross-sector teams to review/finalise sector/cross-sector plans of action; Develop product specific export strategies/plans for at least 3 products Title Location Implementing partners Background/context Results Provincial NES stakeholders consultation in Mazar-e-Sharif and infactory supply chain assessment Mazar-e-Sharif ITC under MoCI and ACCI s leadership in close collaboration with the EU- Farm project implemented by GIZ. The NES design process encompasses provincial consultation in Mazar-e- Sharif, Kandahar, Herat, and Jalalabad to complete analysis of prioritized sectors and to draft plan of actions. Factory visits are carried out to further assess and refine firms productive capacities, competencies, and practices. A NES provincial consultation was held in Mazar-e-Sharif. Public and private stakeholders were given the opportunity to raise specific regional concerns and challenges impending the export development of the Balkh province. Consensus was obtained on key competitiveness constraints and related priority activities based on value chain mapping and assessment. Factory visits were conducted during which supply chain assessments were carried out to further investigate issues raised during NES consultations and 34

35 workshops. Subjects covered: quality process/procedures, HACCP compliance, ISO certification, technical and managerial skills, access to raw materials, packaging, in market-support and trade across borders. Stakeholder /participant information Problem trees, value-chain mapping, and analysis of prioritized sectors and cross-sector functions were further refined based on consultations and factory visits outputs. The NES provincial consultation was opened by MoCI Senior Representative in Mazar-e-Sharif and CEO of Balkh Chamber of Commerce. Number of attendees: 22 Number of woman attendees: 0 Ministries and government agencies: 4 Industry associations and enterprise representatives: 18 Factories visited were undertaken with the dried fruits, nuts and diary sectors. A full list of participants and factories is available on demand. Participant evaluation Participants acknowledged the need for a coherent and detailed strategy and further appreciated the fact that consultations were not Kabul-centric and would take into consideration provinces specific concerns. Additionally, almost all participants indicated their satisfaction for the event and knowledge enhancement on the issues. Evaluation available on-demand. Supporting documents Presentations and tools, value chain maps and problem trees, questionnaires for factory visits. Contribution programmes indicator s achievement towards SUB-IND 1. 4: Number of research and advice provided in relation to the NES development: 1 (This initial analysis is part of the NES design process and helped confirm the priorities to implement in the quality area) 4.2 OUTPUT 2: National public and private stakeholders are enabled to manage and coordinate the implementation of the NES and mobilise support to implement the validated roadmaps Activity Date/location Main Achievements 2.1: Strategy Geneva/Kabul Online SIMT has Implementation been tailored to the Management Tool (SIMT) needs and capacity of MoCI Contributing to indicator SUB-IND 2.1: NES implementation management unit (secretariat) operationalized: In process 35

36 Additional activity aimed at mobilizing key stakeholders across Afghanistan Kabul Consensus built to formalize a Donor Coordination Group. NES perceived as a conduit for coordinated trade related interventions (Awareness raised and initial conditions set to set-up and enable an interactive strategy management system to effectively monitor NES progress, assess impact, identify gaps and duplications, and measure results) Activity 2.1: Management support to establish and operationalize an effective implementation management framework for successful implementation, tracking and measurement and mobilisation of support for the implementation of the NES action plans (NES Coordination mechanism Title Location Implementing partners Background/context Strategy Implementation Management Tool (SIMT) Geneva and Kabul ITC The work of strategy management is to build strong collaboration between all key partners for effective implementation and coordination, as a means to reduce gaps and duplications, and channel resources for implementing the priorities of the strategy. The ultimate goal is to ensure the strategy s priorities, as defined by national stakeholders, receive adequate support, are translate into implementable projects, and contribute to national targets. In addition to building capacities and advisory support, a customizable tool is provided by ITC to ensure that MoCI will have the instruments required to effectively plan, coordinate, measure and prioritise the strategy implementation process. These tools have been developed based on ITC s global experience and the identified emerging requirements of partner countries. The Strategy Implementation Management Tool (SIMT) serves as a single window for organizing, tracking and measuring implementation activities within a country. Results Supporting documents Contribution towards programmes The online SIMT has been tailored to the needs and capacity of MoCI. The SIMT aims to support the national partners and the designated secretariat, as well as all concerned partners involved in monitoring, managing, and promoting strategy implementation according to their specific roles and responsibilities. SIMT Online platform SUB-IND 2.1: NES implementation management unit (secretariat) operationalized: In process (Awareness raised and initial conditions set to 36

37 indicator s achievement set-up and enable an interactive strategy management system to effectively monitor NES progress, assess impact, identify gaps and duplications, and measure results). Title Location Implementing partners Background/context Results Stakeholder mobilization Kabul ITC As underlined in the executive summary section, additional activities were carried to secure and mobilize support towards NES implementation. Key international development partners were fully appraised on all aspect of the NES design and implementation phases through an unprecedented Donor Coordination Meeting (USAID, EU, DFID, EU, German Federal Ministry for Economic Cooperation and Development (BMZ), GIZ, FAO, United Nations Conference on Trade and Development (UNCTAD), UNAMA) followed by bilateral consultations. Consensus was reached on the need to formalize the Donor Coordination Group and on the fact that the NES framework provides a robust conduit for joining forces on trade-related issues, as it offers national and international development partners with the proper implementation plan and framework as well as favourable conditions for operation (i.e. political endorsement, private sector buy-in and donors/ios collaboration). Participants agreed that resource mobilization efforts should be developed in line with the draft strategies plans of action to facilitate, leverage and strengthen diverse sources of financing to support sustainable and inclusive implementation. High-level bilateral meetings (e.g. MoCI and MAIL Ministers, Senior Advisor to President, ANSA DG, ACCI CEO, Head of HEC Secretariat) were organized to sensitize key decision makers on the NES process and ensure that it serves the NDPS as well as remains in line with parallel and related plans and policies. 37

38 4.3 OUTPUT 3: Priority interventions identified during the NES design process are implemented to improve regional integration and international trade competitiveness Activity Date/Location Main Achievements Contributing to Indictor Under Act. 3.2: Advisory services to ANSA to develop services (standards, certification, training center) and other Ministries and TSIs to implement priorities in the quality and SPS areas 2-day workshop on WTO TBT and SPS Agreements 15 & 18 February 2017 Kabul, MAIL (FAO room) 22 stakeholders improved their understanding of the main provisions of the WTO Agreements on TBT and SPS and the associated obligations and the benefit for the private sector. SUB-IND 3.3: Number of trainings delivered to identified institutions: 1 ANSA Priority Plan November March 2017 A detailed priority intervention plans under the project was discussed and agreed with ANSA SUB-IND 3.1: Number of priority initiatives in Quality and SPS areas approved: 1 2-day workshop on Code of Good Practices for standards development, adoption, and promotion 4-5 July 2017 ANSA, Kabul Support obtained from ANSA on the importance of carrying on this workshop and the content taught (including Procedure/manual for development, adoption, promotion of standards) In progress, will contribute to: SUB-IND 3.3: Number of trainings delivered to identified institutions SUB-IND 3.4: Number of advisory services provided to implement the identified priority interventions 1-day workshop on development of Technical Regulations 8 July 2017 ANSA, Kabul Support obtained from ANSA on the importance of carrying on this workshop and the content taught (including procedure/guidelines In progress, will contribute to: SUB-IND 3.3: Number of trainings delivered to identified institutions 38

39 for development, of technical regulations) SUB-IND 3.4: Number of advisory services provided to implement the identified priority interventions Half-day Awareness Workshop On Standardization 9 July 2017 (AM) ANSA, Kabul Support obtained from ANSA on the importance of carrying on this workshop and the content taught In progress, will contribute to: SUB-IND 3.3: Number of trainings delivered to identified institutions Activity 3.2: Advisory services to ANSA to develop services (standards, certification, training center) and other Ministries and TSIs to implement priorities in the quality and SPS areas Title Location Implementing partners Background/context Training workshop on the Agreements on TBT and SPS Kabul ITC, ANSA, MAIL, MoCI Quality management, SPS infrastructures and regional regulatory cooperation have been identified as a priority to enable trade. In particular, technical barriers to trade (TBT), SPS and quality were identified as key challenges in market access of Afghanistan products. As an initial stage, ITC conducted a two-day workshop on WTO agreements on TBT and SPS with participation technical staff from MAIL, MoCI, ANSA, MoPH, and the private sector. The aim of this workshop was to build the internal capacities among the officers of the relevant institutions on the provisions of the WTO Agreements on TBT and SPS. The workshop was based on ITC training materials on TBT and SPS. It was conducted by Ludovica Ghizzoni, Advisor Export Quality Management, ITC, and Dr. Mujiburrahman Khateer, National Consultant Quality and SPS, ITC. Mr. Abdul Qadir Jawad, DM of MAIL concluded the workshop. The methodology adopted for the workshop included baseline assessment (a questionnaire given to the participants to assess their understanding of both TBT and SPS agreements prior to the training and the same questions were answered at the end of the workshop to self-assess their learning thanks to the training workshop, presentations on different aspects of two WTO agreements on TBT and SPS, group discussions, practical examples, classroom activities, question and answer sessions and final evaluation of the workshop by participants. Results 24 stakeholders gained clarity on the main concepts related to standards and technical regulations (TBT/SPS), their importance in accessing important markets, differences and relationship between TBT and SPS, and available information resources. As per the participants evaluation participants improved their understanding of the main provisions of the WTO Agreements on TBT and SPS and the associated obligations and the benefit for the private sector. This helps to assist them in reinforcing their support towards the creation of a more conducive and supportive 39

40 ecosystem for Afghanistan exports to overcome TBT and SPS-related constraints. Participants requested to conduct ToT based on the pilot training and replicate in the provinces. Stakeholder/ participant information Participant evaluation 24 participants (2 female) from MAIL, ANSA, MoCI, MOPH, PS, ACCI An evaluation of the workshop was completed by the participants on the second day. The feedback was positive. Participants appreciated the methodology, the use of real case studies and its practicality. Almost all participant indicated knowledge enhancement on the key topic areas covered. Participants in particular from MAIL, ANSA, MoCI asked for a training of trainers course where a pool of local trainers can be selected, trained for them to roll out a series of training courses on the subject. Supporting documents Contribution towards programmes indicator s achievement ITC Training pack on WTO TBT and SPS Agreements. It includes: - Baseline assessment participants questionnaire. - Presentations on different aspects of two WTO agreements on TBT and SPS. - Classroom activities with case studies. - Final evaluation of the workshop by participants. The training materials were distributed to participants in USB flash drive, one for each organization, as well as by to all participants. A workshop report. SUB-IND 3.3: Number of trainings delivered to identified institutions: 1 Title Location Implementing partners Background/context ANSA Priority Plan Kabul ITC, ANSA ANSA is the national standard body of Afghanistan mandated to establish a sound quality infrastructure in the country. Standardization law governs the functions of ANSA which includes standardization, metrology and conformity assessment (inspection, testing and certification). ANSA obtained body membership of ISO in 2014 and is responsible for WTO TBT Enquiry/ Notification Point. ANSA is a critical institution in the area of quality and is identified as a key partner and beneficiary of the project. Priority interventions were identified to address critical issues raised by stakeholders during the development of the project document, and collection of info during the NES design phase related. More actions and interventions will be identified during the NES design phase. 40

41 Results A detailed priority intervention plans under the project was discussed and agreed with ANSA and approved by its DG. The plan includes training, technical assistance for ANSA staff and other regulatory bodies and private stakeholders in the area of 1) Standards Development and Promotion; 2) Development of Technical Regulations; 3) Assistance to the TBT and SPS Enquiry and Notification Point; 4) Capacity Building on Conformity Assessment - certification schemes (ISO 9001, ISO 22000); 5) initiating a Standard Information and Training Centre (SITC); Commencing Metrology services in the country. ANSA largely upgraded its security measures by addressing recommendations given by UNDP and its premise is now included as a UNDP approved premise for training purpose. Stakeholder /participant information Supporting documents Contribution towards programmes indicator s achievement ANSA ANSA priority plan SUB-IND 3.1: Number of priority initiatives in Quality and SPS areas approved: 1 Title Location Implementing partners Background/context Results Training Workshop on Code of Good Practice for Adoption and Implementation of Standards & Standard Development and Promotion Manual 4-5 July 2017, ANSA Premise, Kabul, (planned) ITC, ANSA The workshop is part of the key priorities identified by stakeholders in the NES with the objective to validate the draft procedure manual for preparation, adoption, implementation, and promotion of standards in Afghanistan. Focus is given to the NES priority sectors and need for standardization work. Support obtained from ANSA on the importance of carrying on this workshop and the content taught (including Procedure/Manual for development, adoption, promotion of standards). Supporting documents Invitation letter, programme, PPT, draft manual on standards development, adoption, promotion. Title Location Implementing partners Background Training Workshop on Development of Technical Regulations 8 July 2017, Kabul, (planned) ITC, ANSA The workshop is part of the key priorities identified by stakeholders in the NES with the objective 1) to sensitise regulatory bodies on good regulatory 41

42 /context practices; 2) to have a consultation with stakeholders on the guidelines/procedure for developing TRs drafted by ANSA in consultation with the regulatory bodies under guidance by ITC. Results Focus is given to the NES priority sectors and need for TRs work and coordination between the regulatory bodies. Support obtained from ANSA on the importance of carrying out this workshop and the content taught (including Procedure/Guidelines for development of Technical Regulations). Supporting documents Invitation letter, programme, PPT, Draft guidelines/procedures on development of TRs. Title Location Implementing partners Background/context Awareness Workshop on Standardization 9 July 2017, Kabul, (planned) ITC, ANSA The workshop is part of the key priorities identified by stakeholders in the NES with the objective to sensitise private and public stakeholders on the role and importance of standards. Results Focus is given to the NES priority sectors and need for TRs work and coordination between the regulatory bodies. Support obtained from ANSA on the importance of carrying out this workshop and the content taught. Supporting documents Invitation letter, programme, PPT. 42

43 4.4 OUTPUT 4: Knowledge sharing mechanisms for GIRoA staff on trade policy/negotiation formulation and implementation are established in partnership with a training institute from the Region Activity Date/location Main Achievements Contributing to indicator Overall: Afghanistan s MoCI partners with Indian CWS 31 March 2017 Kabul, Delhi Clear understanding of needs and agreement reached on trade learning approach for two year training programme SUB-IND 4.1: Partnership with training institution from the region is established: 1 (CWS and MoCI) 4.1: Needs assessment for Trade Policy and Trade Negotiations Training and Certification for Government Officials in Afghanistan April - June Kabul, Delhi Early understanding of needs and agreement reached on trade learning approach for two-year training program SUB-IND: 4.2: Number of training modules/material produced SUB-IND: 4.3: Number of Afghan participants successfully passing trainers' assessment SUB-IND: 4.4: Number of Afghan participants (women) successfully passing trainers' assessment SUB-IND: 4.5: Number of trainers trained Overall Title Location Implementing partners Background/context Afghanistan s Ministry of Commerce and Industries partners with Indian CWS Kabul/Delhi CWS (India based); MoCI; ITC This project aims to put emphasis on the sustainability of transfer of knowledge, local ownership, knowledge sharing programme (e.g. through mentoring of local officers, on-the-job training, and sharing of practices and lessons by key players from the region). As per the project design it was foreseen that a long-term training mechanism would be established through a partnership between MoCI and a leading regional institute in the area of international trade regulation. It was foreseen that a partnership agreement would initiate the partnership framing the 24-month training programme aimed at building the technical expertise of approximately 50 core MoCI officers, academia and other 43

44 relevant governmental agencies/departments involved in trade policy formulation/implementation and trade negotiations in view of the specific needs of Afghanistan. It is foreseen that the close participation of MoCI would also ensure that a sustainable training programme will stem from the partnership which dovetails with potential other ongoing/in the making training programmes which relates to trade policy/negotiations. The programme will provide for a 12-month long continuous training of a group of approximately 25 core officers each year. It will ensure knowledge transfer through its approach of blending tutorials together with mentoring, on-the-job training and face-to-face interaction with key experts from India (and potentially beyond it as well). The objective of the programme is to strengthen the public authorities capacity in trade policy formulation and coordination as well as trade negotiations on a sustainable basis. More specifically, the programme will include the following components (for each 12-month continuous training programme): - An introductory training course on the basic functions of trade policy and rules contained in existing international trade agreements (in Afghanistan). - Advanced training course for ministry officers in core trade policy-making functions (in Afghanistan). - A study tour to India for face-to-face interaction with key experts/policy makers. - Internship: A limited number of government officers within Indian policy making institutions. - Ad-hoc trainings/advisory services for government officers in Afghan Ministries (in Afghanistan). - Cooperation with Afghan universities. Following a procurement process, the CWS (part of the Indian Institute of Foreign Trade) was selected to execute the capacity building project. CWS is a centre for research, teaching and capacity building in international trade, fostering interaction between students and professionals, and allowing for academia, business and government to pool their expertise with the aim of significantly contributing capacities and approaches in the area of international trade regulation. To formerly launch the partnership, the following officials held a meeting on 31 March, 2017, in Delhi, India: - Mohammad Qurban Haqjo, DM, MoCI - Abhijit Das, Head and Professor of CWS - Rajesh Aggarwal, Chief, Trade Facilitation and Policy for Business, ITC - Ajay Bhalla, Director, Indian Institute of Foreign Trade (IIFT) Results Partnership forged between leading regional institute and MoCI. MoCI provides their input on the details of the partnership and anticipated benefits. Supporting documents Press release 44

45 Contribution programmes indicator s achievements towards SUB-IND 4.1: Partnership with training institution from the region is established: 1 (CWS and MoCI) Activity 4.1: Needs assessment for trade capacity building of MoCI and governmental agencies is conducted Title Location Implementing partners Background/ context Needs assessment for Trade Policy and Trade Negotiations Training and Certification for Government Officials in Afghanistan Kabul/Delhi CWS (India based); MoCI; ITC This project is supporting the trade policy and trade negotiations learning development of MoCI and further trade-related ministries and implementing agencies government officers. It is doing this through the support of CWS, which is implementing a tailor-made learning programme over a period of two years. A need assessment is being undertaken by CWS of MoCI to assess technical capacities and then further tailor the forthcoming training to the findings identified. The CWS overall approach to needs assessment is based on two considerations. First, understanding the priorities of trade issues of the GIRoA, existing institutional mechanisms and appropriate human resources for delivering the key outputs expected by the government for responding to multilateral, regional and bilateral obligations under trade agreements and identifying gaps through a structured questionnaire. Second, as part of its accession process to the WTO, Afghanistan has undertaken several key commitments to align its domestic regulatory regime with the WTO framework. While a number of these commitments had to be fulfilled by Afghanistan from the date of its accession, some outstanding issues with a longer implementation period remain. The needs assessment included these crucial aspects and identified gaps in fulfilling these obligations or creating the necessary legal for resorting to trade remedies. Results Well advanced needs assessment showing understanding of the current level of technical capacities of the country s officers in responding to multilateral, regional and bilateral obligations stemming from WTO and other trade agreements. 45

46 Well advanced identification of gaps in skills of officers and institutions in formulating, coordinating and implementing trade policy/regulatory reforms and preparing for and conducting trade negotiations. Obtainment of much relevant information so as to design tailor-made training programme to address the outcome of the need assessment. Stakeholder/ participant information Supporting documents Questionnaire shared with MoCI seeking additional information from the relevant lines ministries of Afghanistan.. Post-Accession Strategy for Afghanistan Draft, (MoCI, Afghanistan); Needs Assessment Report (MoCI, Afghanistan); press release. 46

47 4.5 OUTPUT 5: Institutional mechanisms to facilitate the implementation of the TFA are established at national level and linked with regional partners Activity Date/location Main Achievements First categorization workshop held in January 2017 Kabul in January where stakeholders Kabul categorized TFA Activity 5.1: measures Support the implementation of Collaboration the WTO TFA arrangement set up through technical April 2017 with ATAR project to advisory services jointly implement TF to IMCWTF and Kabul/Geneva activities and the joint other government mission is currently agencies on-going Contributing to indicator SUB 5.2: Number of public and private sector representatives stating increased awareness on the WTO TFA and trade facilitation reforms Activity 5.2: Support the capacity building and operationalization of IMCWTF and other public sector agencies to implement the WTF TFA Activity 5.3: Increase awareness of private stakeholders on the TFA and their ability to contribute to TFA related PPD within May 2017 Kabul/Geneva Geneva Kabul/Geneva Kabul/Geneva Kabul/Geneva Institutional arrangement agreed with ACCI to train private sector on WTO TFA A concept note in being developed on the IMCWTF which will be discussed with the new chair/head in end-july Initial discussions are being held with MoCI, Customs and other government agencies to assess their needs on capacity building for implementing TFA All training material adapted to the needs of Afghanistan and currently being translated in Pashto and Dari Terms finalized with ACCI to benefit from train the trainer and subsequently train private sector in 5 provinces on WTO TFA. The MoU is Will contributes to the realisation of further indicators SUB 5.3: Number of public and private sector representatives stating increased awareness on the WTO TFA and trade facilitation reforms SUB 5.3: Number of public and private sector representatives stating increased awareness on the WTO TFA and trade facilitation reforms 47

48 the IMCWTF and other fora undergoing review legal Activity 5.4: Structure and facilitate a regional network of (existing) NTFC to encourage experience sharing as well as a coordinated and harmonized approach towards the implementation of the TFA Geneva Development of the train-the-trainer module to train ACCI trainers Initial discussions held with Tajikistan s NTFC for future collaboration Secured participation on an IMCWTF member in UNCTAD NTFC Asia-Pacific forum in September 2017 SUB 5.3: Number of participants from public and private institutions to regional events in the area of trade facilitation (project end) SUB 5.4: Number of female participants from public and private institutions to regional events in the area of trade facilitation SUB 5.5: Number of regional events in the area of trade facilitation Activity 5.1: Support the implementation of the WTO TFA through technical advisory services to IMCWTF and other government agencies Title Location Implementing partners Background/ context Assist IMCWTF to categorize, finalize and validate the categorizations and notify Category A commitments to the WTO MoCI, Kabul MoCI WTO Wing and subsequently European Investment Fund (EIF) (USAID contractors on ATAR) On 22 February 2017, the WTO TFA entered into force after two-thirds of the 164 members of the WTO ratified it. It is the first multilateral deal concluded in the 21-year history of the WTO and will now make it obligatory for the members to streamline customs procedures, reduce the time and cost of cross-border trade and make exporting and importing more transparent and predictable. Afghanistan ratified the TFA shortly after acceding to the WTO in July 2016 and will now need to implement trade facilitation reforms in the country. As part of the TFA, one of its first commitments is to categorize the measures of the TFA into Categories A, B, and C which will form the basis for not only notifying to the WTO but also developing other activities of this project such as the development of trade facilitation implementation strategy and Category C Proposals. Results The first categorization workshop was held in Kabul in January 2017 in which initial categorizations were done. The results were extremely impressive and showed the optimistic nature of the participants and their commitment to implement the WTO TFA. Of the 36 measures, only 6 were designated as Category C which showed that Afghanistan is mostly selfreliant to implement the agreement. 48

49 Following up on this workshop and research, ITC further analysed the trade facilitation situation in the country. Further collaboration with ATAR was undertaken and it was agreed that a joint ITC-USAID consultant would conduct extensive field work, meet public and private stakeholders, review laws and regulations, update the TF needs assessment studies, finalize the categorizations and finally validate them-. The consultant s mission is currently on-going and Afghanistan s categorizations will be finalized in a joint ITC-USAID workshop in Kabul on 22 and 23 July 2017 with the technical IWCWTF. These results will be validated in a workshop on 24 July 2017 by the high-level IMCWTF. At this point, further support will be provided to MoCI WTO wing to notify Category A commitments to the WTO. Subsequently, the consultant will develop the trade facilitation implementation strategy document which will be launched with the NES. Stakeholder/ participant information Participant evaluation Supporting documents Contribution towards programmes indicator s achievement The workshop was attended by over 40 government and ACCI officers representing various agencies involved in international trade Number of attendees: 42 Number of woman attendees: 2 Ministries and government agency representatives: 28 Industry associations and enterprise representatives: 14 Unfortunately, due to the security situation in Kabul, ITC staff could not go to MoCI on the second day. Evaluations were only filled by 2 participants which had positive feedback. TFA categorization report; Attendance sheets. Number of public and private sector representatives stating increased awareness on the WTO TFA and trade facilitation reforms in the form of past and future trainings: 2 1 Activity 5.2: Support the capacity building and operationalization of IMCWTF and other public sector agencies to implement the WTF TFA Title Location Implementing partners Background/ context Capacity building workshop to support categorization process Kabul MoCI WTO Wing Recently there has been a shift in personnel looking after various government departments. This has an impact on the IMCWTF as well as other government agencies that are involved in the categorization process. 1 Unfortunately the participant evaluation was not able to be distributed to all participants on the second day of the meeting owing to security issues not enabling the ITC expert to attend. 49

50 Therefore, ITC proposed to MoCI to conduct an awareness-raising session on WTO TFA to increase the effectiveness of the categorization finalization and validation. Results MoCI has shown keenness to host and facilitate the awareness-raising workshop, which has been combined with the categorization workshop and will be held in Kabul from 22 nd to 24 th July with the technical and high-level IMCWTF. During the current mission of ITC-USAID consultant, needs assessments on additional training needs of MoCI and other agencies are currently being carried out and further trainings will be delivered accordingly. Stakeholder/ participant information All public and private stakeholders involved in international trade and parties to the IMCWTF or implementation of WTO TFA. Activity 5.3: Increase awareness of private stakeholders on the TFA and their ability to contribute to TFA related PPD within the IMCWTF and other fora Title Location Implementing partners Background/ context Results Capacity building of private sector on WTO TFA Kabul and Geneva ACCI The WTO TFA is an important tool for economies to improve their business environment. Easing the cost, time and process of doing business and trading is no longer just a policy choice. It is fundamental to increasing the competitiveness of an economy and attracting investment. For businesses, especially for small and medium-sized enterprises (SMEs), operationalizing the TFA is a path to internationalization, which will allow them to access international value chains at lower cost and at greater speeds. And SMEs can most benefit from the Agreement by having a sound understanding of how the new procedures and requirements will complement their business priorities. Like other WTO agreements, the degree to which the intended benefits of the TFA can be actually realised will depend upon how it is implemented in national law and practice. While implementation is the primary responsibility of the WTO members, businesses play a critical role in the consultative process to advise (through PPDs) authorities as to how the Agreement is best applied in the national environment. The training material has been developed for Afghanistan s private sector to understand the benefits of WTO TFA and also to understand the role they can play through PPDs in its effective design and implementation. A trainthe-trainer module has also been designed. All training material is currently being translated in Dari and Pashto. To ensure local ownership and long-term sustainability of the initiative, ITC has finalized terms with ACCI whereby ACCI will provide 5 trainers that the ITC will train through the train-the-trainer methodology. This is scheduled to take place in October 2017 after which ACCI trainers will be implemented in 5 provinces in Afghanistan to conduct three-day training each to over 30 participants. These trainings are expected to take place in The MoU is currently under legal review and is expected to be signed in September

51 Stakeholder/ participant information Supporting documents ITC experts, ACCI trainers, and coordinators, MoCI support. WTO TFA - A Business Guide for Developing Countries. 4.6 OUTPUT 6: SME knowledge of how to manage national crossborder procedures and compliance with regional and/or global market requirements is built encompassing priority markets (building on NES findings) Activity Date/location Main Achievements 6.1: Conduct a Kabul/Geneva Finalized the scope of needs assessment the activities to of SME export exclude e-learning management and and focus on key compliance export sectors. Since training and training needs are information basic, the modules requirements will start with very basic information 6.2: Develop, publish and disseminate of a National Trade Procedures Guide for SMEs and entrepreneurs in priority import/export sectors 6.3: Develop an SME export management and compliance training curriculum 6.4: Train the trainers to facilitate e- learning session and to deliver Kabul/Geneva Key export sectors researched and identified after consultations with local stakeholders Templates of export management guides developed Draft versions of export management guides developed and currently being reviewed Kabul/Geneva Cross-sector export management modules developed and will be translated. Sector specific modules will be developed after completion of Activity 6.2 Kabul/Geneva Initial discussions held with ACCI, ACE on possible collaboration in future Contributing to indicator Will contributes to the realisation of further indicators SUB-IND 6.3: National Trade Facilitation procedure guide published SUB-IND 6.1: Number of private sector representatives who participated in the export management curriculum and pass knowledge tests SUB-IND 6.2: Trainers are trained 51

52 face-to-face training 6.5: Organize and facilitate the delivery of four full curricula TBC TBC SUB-IND 6.1: Number of private sector representatives who participated in the export management curriculum and pass knowledge tests Activity 6.2: Develop, publish and disseminate a National Trade Procedures Guide for SMEs and entrepreneurs, in print as well as online Title Location Implementing partners Background/ context Results Development of National Trade Procedures guides for SMEs in entrepreneurs Kabul/Geneva Afghanistan Centre of Excellence (ACE) The project aims to strengthen the capacities of SMEs to manage crossborder procedures and engage in exports of 4 key sectors in Afghanistan. This will be done through the development of national export procedures guides for each priority sector where key formalities, documents and procedural requirements will be detailed in a user-friendly manner and practical steps to complete an export transaction in Afghanistan will be provided. Each export guide will also contain a section on requirements of 2 or 3 main destination markets for that sector as well as a brief sector analysis and other practical information that may be useful for the trader. ITC conducted extensive research to finalize the templates of guides as well as the key priority sectors on which the export guides are being developed. This was done in collaboration with the NES to ensure that there are synergies created between the two outputs. As a result, an export guide is being developed for carpets, handicrafts, saffron, fruits & vegetables and dry fruits & medicinal herbs. Subsequently, ITC recruited a consultant from ACE to carry out the field work in Afghanistan to document all the requirements and develop the guides. The draft versions of the reports have been reviewed and the consultant has been provided with feedback to make further improvements and conduct more research. Once developed, the report will be validated by public and private stakeholders and then translated, published and disseminated in line with EU s communication strategy and ITC s local network. Stakeholder/ participant information Supporting documents ACE, ACCI, sector specific exporters, ACCI, EPAA, Customs. Interview clips. 52

53 Activity 6.3: Develop SME export management and compliance training curriculum with a blended learning approach (i.e. face-to-face sessions complemented by e-learning curricula and on the job coaching) Title Location Implementing partners Background/ context Results Develop an SME export management and compliance training curriculum Kabul/Geneva To be determined The project seeks to develop a training curriculum to support SMEs to comply with Afghanistan's cross-border procedural and regulatory requirements in relation with export transactions to its main trading partners (such as EU, regional countries). The scope of the training is limited to the export administrative and logistics processes: obtaining export licences and permits, collecting, filling and submitting the export documentation to the relevant border regulatory agencies, hiring and maintaining successful relationships with customs brokers and freight forwarders. The training will not cover the production processes nor the commercial processes that are not linked to the export processes (i.e. marketing, contract negotiation, invoicing). ITC has developed a training curriculum composed of 6 modules, each module comprising of 2 lectures and 1 case study. These modules so far focus on the generic export management modules and will be further enriched with Afghanistan specific and sector specific information after the completion of Activity 6.2. Once the training is fully developed, ITC will engage with a local institution to conduct a train-the-trainer programme and subsequently conduct trainings of SMEs across Afghanistan. The trainings will also be used to develop train the trainer methodologies and coaching kits that will be used to achieve other activities in this output. Stakeholder/ participant information Supporting documents ACE, ACCI, sector specific exporters, ACCI, EPAA, Customs. Interview clips. 53

54 4.7 OUTPUT 7: Public-private consultation process on domestic/regional key pressing trade policy/regulatory/negotiation issues is strengthened Activity Date/location Main Achievements 7.1: Needs January May Understanding of assessment for the 2017 performance of operationalisation of a existing PPD PPD platform on trade Kabul/Geneva mechanisms policy Recommendations for enhancement of PPD mechanisms Contributing to indicator SUB:IND 7.2: Number of policy research/material produced: 1 Under Act. 7.2: Research materials/position papers through peer review (whenever local capacity exists) are produced Policy document: ANTP ( ) February ongoing Kabul/Geneva Endorsement of approach for developing national trade policy SUB-IND 7.2: Number of policy research materials produced Raising awareness good policy for export competitiveness Two drafts of ANTP produced Under Act. 7.3: Public-private policy consultations (included at bilateral/ and regional level) are organized Supporting bilateral stakeholder consultations to enhance trading relations between Afghanistan and Iran April ongoing Kabul/Tehran/Geneva Endorsement of approach for regular bilateral stakeholder consultations to advance trading relations SUB-IND 7.1: Number of publicprivate dialogues/trainings held & SUB-IND 7.2: Number of policy research/material produced Supporting bilateral stakeholder consultations to enhance trading relations between Afghanistan and Uzbekistan May ongoing Kabul/Tashkent/Geneva Endorsement of approach for regular bilateral stakeholder consultations to advance trading relations SUB-IND 7.3: Number of recommendations stemming from PPD 54

55 Activity 7.1: Needs assessment for the operationalisation of a PPD platform on trade policy Title Location Implementing partners Background/ context Diagnostic study: Public-private dialogue mechanisms for informing trade policy in Afghanistan: An assessment of existing mechanisms and recommendations for a future one Kabul MoCI, ITC, ACE In Afghanistan, dialogue between the GIRoA and the private sector has remained ad hoc, spontaneous, and to some extent donor-driven, over the past 15 years. Typically, consultations with the private sector have been a necessity during preparations for and attendance at multilateral conferences as part of bigger economic development agendas of the government. During the Brussels Conference on Afghanistan 2, for instance, a representative from ACCI had participated as part of a panel on overall economic issues and not directly on trade. Even though ACCI had extensively participated in the preconference consultations, the dialogue process had not sustained after the conference had ended. The publications from the conference merely mention a sustainable dialogue mechanism between the public and private sectors. Engagement of the private sector in 2014 was in preparation for the London Conference on Afghanistan. ACCI and Harakat-Afghanistan Investment Climate Facility (AICF) had held a Private Sector Priorities for Reform Conference before the London Conference to collect, analyse, and present views and recommendations of the private sector in the form of 11 private sector priorities. The conference had mostly private sector businesses in attendance with no representation of the government, indicating the consultation did not qualify as a dialogue between the private and the public sector, but rather, as an information collection platform. In terms of mechanisms for engagement, whether they be ad-hoc or more formalized- the following are operating: The ANPDF ; The draft of ANTP 2014; Inter-Ministerial Committee on WTO & TFA. Most of these platforms. A public-private consultation process which is established and maintained simultaneously with the strengthening of technical skills of public/private stakeholders is recommended as a powerful means to inform policy/regulatory/trade negotiation formulation/implementation. The project aims to provide advisory services on how to establish/strengthen inclusive PPD mechanism on trade policy/trade negotiations / domestic regulatory reform issues, share best practices, sponsor and organize thematic public-private consultations informed by targeted evidence-based studies. A combination of desktop research and stakeholder interview were carried out between February 01, 2017 and April 12, It was guided by ITC s assessment tool, which is designed to diagnose the state of PPD in a 2 Brussels Conference on Afghanistan was held on 4-5 October, For more information see here: 55

56 country, identify areas for possible improvements in dialogue, and inform the development of new dialogue initiatives. The studies results will be further presented at upcoming stakeholder consultation and in particular deliberations will be undertaken to determine what may be a most affective PPD mechanism on trade policy. Results The study: - Analysed and scorecard the performance of relevant existing PPD mechanism of trade-related issues according to set criteria. The assessed mechanisms were provided for 1) Inter-Ministerial Commission on Trade Facilitation (IMCTF); 2) SME Working Groups of MoCI; and 3) High Economic Council. - Presented options for a structured and effective PPD mechanism in Afghanistan. - Identified priority issues from both the private and public sectors which could the subject for discussion under a PPD mechanism. Stakeholder/ participant information Supporting documents Contribution towards programmes indicator s achievement Stakeholders from the following were interviewed so as to carry out the study: ACCI, MoCI. Leading Entrepreneurs of Afghanistan for Development (LEAD), ICC, MoCI, HARAKAT, MoCI, Carpet Association, HEC, and GIZ. In addition to numerous private sector exporters. Public-private dialogue mechanisms for informing trade policy in Afghanistan: An assessment of existing mechanisms and recommendations for a future one. SUB-IND 7.2: Number of policy research/material produced: 1 Activity 7.2: Research materials/position papers through peer review (whenever local capacity exists) are produced Title Policy document: ANTP Location Kabul/Geneva Implementing MoCI, ITC partners Background/ In the era of globalization, trade has become an all-pervasive part of context economic life. Trade issues affect, and are affected by, almost all other economic and social policies. A trade policy can, therefore, constitute a potent tool for the government to achieve economic objectives and influence 56

57 growth and development. Effective trade policies can promote economic development by encouraging more productive investment, which will lead to a more internationally competitive private sector. To date, Afghanistan has not had a national trade policy. MoCI has requested ITC for technical assistance in developing an ANTP ( ). A previous draft was considered not sufficient, hence the request by the MoCI for the assistance of ITC. ITC recommended and subsequently gained the approval for the methodology/timeframes for the development of the national trade policy document in the course on 2017 (completion by around September 2017). ITC s unique approach looks at how trade policy instruments affect each stage of the trader's supply chain, and subsequently how right policy choices can be implemented to enhance its functioning and thus increase export competitiveness. Required activities, timeframes for developing the policy document were set and agreed upon with MoCI. Some of the main activities included development of structure, review of existing policy documents/relevant papers, development of issue paper, stakeholder consultations, review/incorporation of inputs. Two first drafts have been shared with the MoCI for review, and comments received back have been incorporated. A national stakeholder consultation has been scheduled to occur in August to further discuss contentious issues and contents more generally. Results Endorsement by MoCI of ITC methodology (including stakeholder consultation process) for developing ANTP. Development of first draft incorporating first round of local stakeholder reviews. Stakeholder/ participant information Supporting documents MoCI ANTP ( ) second draft (also translated into Dari); Issue paper. Activity 7.3: Public-private policy consultations (included at bilateral/ and regional level) are organized Title Implementing partners Background/ context Supporting bilateral stakeholder consultations to enhance trading relations between Afghanistan and Iran MoCI Building upon interest to utilize the Chabahar Port as a cost efficient way to export Afghan goods and allow imports into the country from not only Iran but also further neighboring countries such as India, this intervention is proposing to support bilateral public-private stakeholder consultations between Afghanistan and Iran. 57

58 Moreover, the Chabahar Port is shaping up as a cost efficient get away for Afghan goods to re-connect with the regional and global value chains. Chabahar port is 90 km closer to Kabul city than Abbas port and 700 km closer to Kabul city than the port of Karachi. It would lead to reducing the cost of transit significantly per container, thus enhancing the competitiveness of Afghan exports. Effective utilization of the Chabahar port could potentially redirect some Afghan trade from Pakistan to Iran, through which Afghan goods could more easily reach the lucrative Indian market: it could allow Afghan goods to reach New Delhi in five days, nearly halving the transit time when sent through Pakistan. Moreover, studies indicate that the corridor at Chabahar could bring down costs to transport cargo trade to Europe by approximately 50 per cent. Costs would be reduced by almost a third to trade to India. As such, Chabahar would provide an alternative route for Afghanistan to establish a trade relationship with India and other countries and cater for the challenges currently faced in the implementation of the Afghanistan- Pakistan Transit Trade Agreement. However, there remain a number of obstacles, which relate to policy, regulatory and procedural issues which present an obstacle to advancing cooperation most optimally. There is also a further need to build-off and create new trading opportunities aided by the targeted policies and incentives provided by both governments. While a number of countries from the region had been initially envisaged for the holding of bilateral consultations, Mr. Mohammad Haqjo DM for Commerce at the Ministry of Commerce at the time, expressed the willingness of the Government of the Islamic Republic of Afghanistan to focus on Iran and/or Uzbekistan. A concept note was developed and shared with key stakeholders including (MoCI and MoFA). Also, preliminary meetings/exchanges have taken place including with the Commercial attaché of Iran in Kabul, Ambassador of Iran in Geneva, head of Trade Promotion Organisation in Tehran /Ministry of Trade of Iran. All have expressed positive feedback. The concept note outlines an approach to engage public and private sector stakeholders of both countries in a continuous/regular dialogue on how to best facilitate trade between both countries so as to gain consensuses on the path forward. Moreover, it proposes through the initiative: - Consensus fostered between public and private sector actors on how best to facilitate Afghanistan / Iranian trading relations - Views and concerns of the business community and other stakeholders solicited about a range of issues affecting cross-border trade - Deliver relevant recommendations that have a reasonable prospect of implementation and to prepare an agenda to remove obstacle to trade/advance opportunities - Effective follow-up and monitoring of progress and regular feedback to stakeholders The concept note is with the MoCI, and following their endorsement it is intended that first stakeholder consultation will follow soon after. Results Awareness raised on approach detailed in concept note for regular bilateral stakeholder consultations to advance trading relations. 58

59 Stakeholder/ participant information Supporting documents MoCI (Afghanistan), Iran Trade Promotion Organisation, Permanent Mission of the Islamic Republic of Iran to the United Nations Office, Ministry of Trade Islamic Republic of Iran, Embassy of Iran in Afghanistan. Concept note: Supporting bilateral stakeholder consultations to enhance trading relations between Afghanistan and Iran. Correspondences with the key officials. Title Location Implementing partners Background/ context Supporting bilateral stakeholder consultations to enhance trading relations between Afghanistan and Uzbekistan Kabul, Tashkent, Geneva MoCI Building from a recent upscaling of collaboration between Afghanistan and Uzbekistan to expand trading and cross-border cooperation, this intervention is proposing to support bilateral public-private stakeholder consultations between the two countries. In particular, there remain a number of obstacles, which relate to policy, regulatory and procedural issues which present an obstacle to advancing cooperation most optimally. There is also a further need to build-off and create new trading opportunities aided by the targeted policies and incentives provided by both governments. While a number of countries from the region had been initially envisaged for the holding of bilateral consultations, Mr. Mohammad Haqjo DM, MoCI, at the time, expressed the willingness of the Government Afghanistan to focus on Iran and/or Uzbekistan. Preliminary contacts have been made with Uzbek officials in Geneva to assess whether their government would be interested in this endeavor. On 10 June the Geneva-based mission confirmed the interest of the capital to proceed further and further communicated high levels of interest obtained from the Uzbek Chamber of Commerce. Followup meetings were called with Commercial attaché based in Geneva to further detail the plan and sound out contacts in particular for the policy makers. MoCI is to prioritize which country it should go with (i.e. Iran or Uzbekistan) and provide political support. Results Stakeholder/ participant information Supporting documents Awareness raised of approach for regular bilateral stakeholder consultations to advance trading relations. MoCI (Afghanistan); Permanent Mission of the Republic of Uzbekistan to the United Nations Office and other International Organisations in Geneva, Uzbekistan Chamber of Commerce (Through MoFA) Correspondences with key officials 59

60 5. OVERARCHING FOCUS ON TRADE LEARNING AND CAPACITY BUILDING FOR REGIONAL CO-OPERATION THROUGHOUT ALL THE ABOVE COMPONENTS A focus of this project is to promote trade learning throughout all the above components. The following provides a brief summary the ways in which these are be done (these inputs have also been detailed elsewhere in the project document in more details. Overall - Development of project website, which also provides access to ITC trade Academy (See Section 7) Output 1 & 2 : - Capacity building in strategy design: Staff from MoCI, EPAA, consulting firm as well as key members of the AdvIntery Group to the NES Core Team are being exposed to ITC s methodology & tools on Value Chain Analysis and Strategy Design (Ongoing) (See Section 4, Act 2.1) - Skills development strategy. This theme is emerging as a priority and will involve training (Ongoing) Output 3 - A two-day workshop on WTO TBT & SPS, Agreements: A business perspective was conducted on 15 & 18 February (See Section 4.3; Act 3.2) - A series of training workshops are being planned for 2017 for the authorities: standards; enforcement of technical regulations; technical regulations for regulatory bodies; Training of technical staff of National Enquiry Point (TBT and SPS NES, NNA); on conformity assessment (Lead auditor training course on ISO 9001, ISO for 15 auditors) (See Section 4.3; Act 3.2) Output 4 - A partnership agreement was reached between the MoCI and CWS for the trade policy learning capacity building for a two-year duration (See Section 4; Overall ) Output 5 - Training on the WTO TFA Agreement and categorization in January 2017 (See Section 4, Act 5.1) - Sharing of best practices with other NTFCS Output 6 - Development of export management guides for five key export sectors in Afghanistan to outline all step by step export procedures to benefit SMEs (See Section 4; ACT 6.2) Output 7 - Capacity building for the development of national trade policy paper. This includes development of methodology and understanding of how trade policy instruments affect each stage of the trader's supply chain, and subsequently how right policy choices can be implemented to enhance its functioning and thus increase export competitiveness. Significant interactions have occurred with MoCI government officials on the methodology as well stakeholder consultations are planned to further detail. (See Section 4; Act 7.2) 60

61 - Provision of a tool for assessing the performance of public-private dialogue mechanisms on trade issues, and making clear what ingredients make up a well-performing mechanism. During stakeholder interviews, significant interactions occurred with government officials on the report and its contents are further being discussed with MoCI and will be further presented at an upcoming stakeholder consultation.(see Section 4; Act 7.1) 6. DIFFICULTIES ENCOUNTERED AND MEASURES TAKEN Overall - Uncertainties in the security situation. In particular, the devastating bomb attack on central Kabul on 31 May, heightened the UN security risk levels in the country and ITC was not advised to implement activities in the immediate period afterward. - The departure of the former MoCI DM Haqjo together with the MoCI project focal point constitutes a loss in terms of knowledge and leadership. Also connected with the departure of DM Haqjo, leading up and following his departure, there was a notable delay in decision making to advance project implementation in which key high-level approval was required. ITC has undertaken significant efforts to orientate the new DM, Ms. Sidiqi and her team about the project and there is now a resurgence in momentum. Output 1 & 2 - Public sector capacity of key institutions such as MoCI, ANSA, MAIL etc. is definitely restricted and requires immediate support. While the NES will address institutional deficiencies in detail, the current capacity challenges are expected to pose some challenges during the NES design in terms of planning and logistics as well as the endorsement of intermediary results/papers. - The review and subsequent approval of the NES Response Paper are currently facing delays. ITC and MoCI are exploring (lighter) alternative procedures to facilitate the review process. - MoCI s faced challenges to execute the logistical requirements in advance of the first consultation (participants identification, RSVP etc.). Although the designated officer is capable, he does not yet have a secretariat team assigned solely for the NES. ITC s lead national consultant took part of these responsibilities. - The core team identified is not up-to-standards and seniority that is required for the success of the NES. In this regard, the ITC team is working with MoCI to further identify the appropriate senior decision makers in key ministries/private sector that would be ideal for stewarding the NES process. - The low knowledge base of the Afghan private sector requires a deft and flexible approach the typical economic and technical background that is normally provided in consultations as reference material will not be effective and therefore the presentations and exercises will be adapted accordingly. - MoCI has an export development plan that has recently been developed and submitted to HEC. ITC raised the point that having a NES and an Export Development Plan simultaneously will lead to confusion and redundancies MoCI clarified that this is mainly an institutional capacity development plan and that the plan will be absorbed into the NES. - Both MAIL and MOPH are working towards the establishment of a Food Safety Authority; ITC raised the opportunity to use the NES to clarify roles and responsibilities also for setting up of new functions. A dedicated consultation with MoPH and MAIL shall be organized. Output 3 61

62 - Training and advisory services in the area of quality and in particular in SPS require highly specialized technical expertise. Due to the security situations, many international experts having been contacted by ITC expressed concern to conduct missions to Afghanistan. Some training such as Lead Auditor Course would be conducted abroad. ITC will extend the network of experts willing to go to Afghanistan in order to build more local capacity. - Considering the rapid turn-over at government institutions, the training should target as many technical staff of an entity as possible in order to ensure sustainability of the capacity developed. Furthermore, the project is considering some form of binding with the relevant institutions to utilize the capacity and conduct regular training internally. Output 4 - The departure of DM Haqjo together with the project focal point from MoCI slowed the momentum of implementation, as key decisions (Concerning execution of needs assessment and carrying out of first training) were slowed in their absence. ITC subsequently undertook considerable efforts to orientate the new DM Sidiqi and her team in the project and forge working relations with CWS and ITC counterparts so as to resume the flow of implementation at the earliest. Outputs 5 & 6 - In order to avoid duplication of work, ITC reached out to ATAR project to collaborate on similar activities. Even though it was received positively, it took a long time to formalize the arrangement due to delays in obtaining approvals from EIF, ATAR and USAID hierarchies. However, the arrangement is now in place despite the long waiting period and the joint-work is underway. - Reshuffling of staff in government agencies was surprising and resulted in some capacity gaps. The staff trained on different aspects of WTO TFA may not be relevant anymore and fresh awareness raising session is being conducted in July to mitigate the risk, - ITC staff needs to abide by UNDP s security recommendations. During the categorization workshop, UN rules did not allow ITC expert to travel to MoCI to conduct the second day of the workshop. However, MoCI WTO Wing did an excellent job to fill in and finish the workshop. Output 7 - The departure of DM Haqjo slowed the momentum of implementation, as key decisions (concerning internal review of ANTP and input/approval on bilateral PPDs with Iran and Uzbekistan) were slowed in his absence. ITC subsequently undertook considerable efforts to orientate the new DM Sidiqi and her team in the project and forge working relations with in order to resume the flow of implementation at the earliest. - Raising awareness and gaining input and support for bilateral PPDs in the diverse capitals of Kabul, Tehran and Tashkent proved challenging. While ITC is leveraging key contacts, support (including through coordination between MoCI and MoFA) is sought so as to create a political momentum. 62

63 7. IMPLEMENTATION OF THE VISIBILITY AND COMMUNICATION PLAN Information below is reported on the basis of the Project Communication and Visibility Plan. It is to be noted that, under all Outputs, reports, training materials, presentations, event agendas, etc. have been formatted in line with the project visual templates, as validated by the EU Delegation, for dissemination to government officials, the private sector, the media, development partners and other stakeholders. a. Project visibility during the period under reporting Afghan Trade Website Developed and operating since 15 April, the project website is being updated on a regular basis to cover: - Latest news - Outputs activities - Newsletters - Workshop / Trainings / Conferences reports/ articles - Publications - Pictures - Links to further national and regional stakeholders As of 13 June, there had been 1043 page visits. Visitors came from total of over 20 countries with the top 10 countries shown below: S.No. Country 1 Switzerland 2 Afghanistan 3 Belgium 4 United Kingdom 5 United States 6 United Arab Emirates 7 Germany 8 Pakistan 9 France 10 India Advancing Afghan Trade - quarterly newsletter The first issue was circulated on 10, May 2017, with its main purpose being to introduce the project, its main outputs and some of the activities completed to date. It featured the following articles: It was published and distributed to a mailing list of approximatively 500 heads/senior executives from more than 210 unique organization like Ministries, Diplomatic Missions, Commerce Associations, Embassies, SMEs and many more spanning across 10 different countries including Afghanistan, Brussels, India, Iran, Kazakhstan, Kyrgyz Republic, Pakistan, Tajikistan, Turkmenistan, Uzbekistan. The mailing list also included the heads of all European missions based in Kabul. The newsletter was well received and opened by many people more than once showing the interest in the content. The average openings per recipients was an astonishing 3.8 times. Please find below more statistics about the newsletter campaign: 63

64 Key Statistics For Newsletter No. Of Recipients 429 No. of Unique Openings 171 (40%) Total No. of Opening (Including Repeats) 655 (152.7%) AAT project brochure Widely distributed to the stakeholders at all major events and displayed on project website (versions in English, Dari and Pashtu) Press Coverage Since launching the project in November 2016 significant media attention has been attracted both within the Afghanistan, the region and abroad. In Afghanistan, the Ariana Television Network (the network with the largest private media channels in Afghanistan covering 33 of 34 provinces), The Kabul Tribune, Khaama Press (one of the largest news and information sources in Afghanistan) and the 8 am Newspaper have all covered the project. Business channels have also picked up the story, including Wadsam Afghan Business News Portal, which is Afghanistan s number one online business news source dedicated to publishing business news. In India, media channels covered a partnership agreement between the Delhi-based Centre for WTO Studies (a leading think-tank in the region) and the Afghanistan s MoCI. About 55 articles covering activities of AAT featured in print media (Dari, Pahstu and English). The articles provided strong publicity of AAT interventions and acknowledged the positive contributions and efforts of the programme, the EU and implementing partners. The list of articles is as follows: Complete versions of the ITC press releases produced and further media coverage received can be seen in Annex I. Social media coverage ITC specific (Twitter and ITC Facebook page) ITC ran 7 social media campaigns to publicise main activities of the project. The tweets were featured on both the ITC corporate twitter and Facebook pages, and were retweeted on many occasions during the campaigns. For outreach, statistics see Section B below. Facebook group Developed and operating since May 12. Currently, there are144 number of members, with many of them being stakeholders drawn from business associations, government and exporters. Many of them have been involved in our project implementation activities are so well informed on its projects purpose. The group is administered by ITC and posts regular updates in regards to project implementation as well as profiling relevant initiatives, reports completed from other organization in Afghanistan and region. The group allows for professional networking, awareness raising and sharing of information. For outreach statistics see Section B below. Social media coverage beyond ITC Events and work done by ITC have been appreciated and spread multiple times on the social media profiles of key international organizations like EU in Afghanistan and Ministry of Commerce and Industries Afghanistan. Certificates Produced and distributed after the trainings organized by the AAT, with logos of all parties, including the EU. 64

65 Visibility templates Graphically designed templates have been produced for the following, project banner; publications; PPT backdrop; notebook; brochures, etc. The templates show most favourable to the project, implementing partners and present a common identity. Project references Effort is being undertaken to ensure that the project is referred to. One such reference was an article, Advancing Afghan Trade project supports mutually beneficial regional trade featured in the April June, 2017, edition of the newsletter, ITC projects in Tajikistan. The article detailed the background of the AAT project as well as importance for Tajikistan, and provided further links to the project website and Facebook group. Additionally the project will feature in the next addition of the ITC flagship magazine, International Trade Forum. Regional networking Extensive effort has undertaken in order collaborate with relevant regional initiatives so as to inform about the project and propose possibilities for synergies. Among the regional organisations and forums contacted include Heart of Asia-Istanbul Process(HoA); Regional Economic Cooperation Conference on Afghanistan (RECCA) SAARC Chamber of Commerce and Industry, Central Asia Regional Cooperation (CAREC), Economic Cooperation Organisation (ECO) and University of Central Asia. Arancha González, Executive Director, ITC, participated in a conference, Brussels Conference on Afghanistan Regional Integration and Prosperity held on 4 October At this conference, Ms González moderated a panel discussion session, Regional Infrastructure and Regional Trade & Transit. At the event, she also conveyed the AAT project and its importance. At this occasion, flyers of the project were circulated to all participants. Additionally, Rajesh Aggarwal, Chief, Trade Facilitation and Policy for Business, ITC participated in the inaugural meeting of the RECCA Business Forum held 1-2 March 2017, in Istanbul during which he introduced the project to all participants. As a follow-up, Ms Arancha Gonzalez has been invited to participate in the next RECCA VII Ministerial meeting to be held in Turkmenistan. Finally, efforts have been made to promote many of the regional initiatives on the project website, and vice a versa. b. Progress vis-à-vis communication objectives Tool Press release Project "newsletter" ITC website; project's website Indicators 4 press releases/media advisories produced Number of readers (ITC website): 526 Number of media using the press release: 39 press articles/releases published, TV and radio reports produced about the project Number of issues: 1 Number of subscribers: 429 % of opening: 40% (171) Number of visits: 1043 Number of downloads of material:

66 Web highlights Number of readers: 0 (no web highlights articles produced yet) Media channels Number of articles published: 45 Information material (leaflet, brochures) Number of information material: 15 Including: - Afghanistan s National Export Strategy: Response Paper (English and Dari versions) - National Export Strategy: Concept Note - Core Team Terms of Reference - Priority Sectors Value Chain Mapping and Problem Trees - Quality Cross Sectors Value Chain Mapping and Problem Trees - Trade Flow Analysis - Public Private Dialogue Mechanisms for Informing Trade Policy in Afghanistan: An Assessment of Existing Mechanisms and Recommendations for a Future One - Supporting Bilateral Stakeholder Consultations to Enhance Trading Relations Between Afghanistan and Iran: Concept Note - Advancing Afghan Trade: EU Trade Related Assistance (Project flyer; English, Dari and Pashtu versions) - Steering Committee Terms of Reference - Quarterly Snapshot Progress Reports (March and June) - Review of IMCWTF - Procedure for the Development, Adoption and Promotion of Standards - Procedure for Development of Technical Regulations - ANSA priority plan Social media Twitter / LinkedIn / Facebook: Twitter: Number of posts: 7 Total reach: Total engagement: 350 Facebook group: New followers (%) Followers start: 0 Followers end: 144 Total engagement: 67 Synergies created between outputs 66

67 Synergies between NES, QM, and TF The NES offers an overarching framework for creating synergies with other components. Both TF and QM will have their individual crosscutting/trade support function strategy as part of the overall NES. The TF crosscutting strategy will form the base for other future activities in Output 5 such as development of an action plan for IMCWTF, development of Category C measures. There are also synergies between NES and Output 6 whereby the selection of key export sectors (on which the guides and trainings will be based) was done in line with the findings of the NES. Synergies between development of NES and ANTP Synergies and complementarities between are two-fold: - Through the processes which the two documents will be delivered: the NES and the ANTP are/will be fed through consultation of the same stakeholders and under the common leadership and coordination of MoCI. The ANTP will eventually be validated by the NES Core Group representatives. This will ensure that the ANTP is aligned with the NES and that synergies between the two are in-built. - From a substantive point of view: while the NES provides a framework which is based on a diagnosis of the issues affecting export competitiveness, including policy related, the ANTP is a formal statement expressing the government objectives and policy options which will be pursued in line with MoCI mandate. Therefore, while the NES is a strategic document covering the spectrum of all issues to be addressed of in order to improve export competitiveness, the ANTP makes clear the priorities of MoCI to be further implemented by all departments under its jurisdiction and in coherence with other Ministries mandate. While the same issues may be looked at, policy issues under the ANTP will be scrutinized in more details including with regards to the obligations stemming from the WTO commitments/membership. Synergies created between AAT project and other initiatives At project-wide level, ITC has engaged in an extensive effort to reach out to other initiatives, both at the national and regional level, so as explore possibilities for synergies. As AAT is a new project, much effort was made to familiarize targeted stakeholders of our initiative and make further suggestions as to where possible synergies may exist. The following presents an overview per output of synergies that have or are in the process of being forged. A high-level Afghan government delegation to Geneva (sponsored by USAID) received a detailed briefing of the AAT project, as part of their visit. ITC collaborated with USAID sponsored initiative aimed at exposing highlevel Afghan government officials to Geneva based trade related organisations (in particular the WTO). ITC delivered informative session on the AAT project and responded to questions, and further explored where synergies exist with the USAID coordinator. NES design Key international development partners were fully apprised on all aspect of the NES design and implementation phases through an unprecedented Donor Coordination Meeting (USAID, EU, Department for International Development (DFID), EU, BMZ, GIZ, FAO, UNCTAD, UNAMA) followed by bilateral consultations to make sure that the NES capitalizes on recent partners initiatives. Consensus reached on the need to formalize the Donor Coordination Group and on the fact that the NES framework provides a robust conduit for joining forces on trade-related issues. This is since it offers national and international development partners with the proper implementation plan and framework as well as favourable conditions for operation (i.e. political endorsement, private sector buy-in and donors/ios collaboration). Participants agreed that resource mobilization efforts should be developed in line with the draft strategies plans of action to facilitate, leverage and strengthen diverse sources of financing to support sustainable and inclusive implementation. In spirit, and in action, the NES is aligned to the policy priorities and national goals established by the Cabinet and the High Economic Council in areas related to socio-economic growth, private sector development, investment promotion, investor protection, economic diversification and others. The methodology, specifically 67

68 customized to the requirements of Afghanistan, ensures that this overarching and incontrovertible principle is followed throughout the NES design and implementation process. In practice, the NES strictly adheres to the principles and instruments of the New Development Planning System that has been established by GIRoA through the aegis of the ANPDF. This includes structural alignment within the system as well as positioning vis-à-vis the NPPs. The NES contributes in real and significant terms to the Private Sector Development NPP that is being shepherded by the HEC. This has the potential to not only reduce the design time for the overall NPP (resulting in an early start to the implementation) but also ensure robust depth and quality of the multiyear NPP. Public-private dialogue on trade policy Through a diagnostic study, Public-Private Dialogue Mechanisms for Informing Trade Policy: An Assessment of Existing Mechanisms and Recommendations for a New One ITC presented options for a structured and effective public-private dialogue on trade policy in Afghanistan. One of the more favourable options presented was to align with the newly formed Executive Committee on Priorities of the Private Sector (PriSEC). ITC has since further approached PriSEC to explore the possibility of future development of synergies. ITC has specifically requested involvement in Working Group, Agriculture, Trade, and SMEs, and has requested involvement in forthcoming meetings in an effort to see if synergies can be created and be kept informed of the work the group is undertaking. Similarly, ITC is exploring creating linkages with new DFID initiative (former HARAKAT), which is also undertaking a PPD approach. QM Linkages with ITC e-commerce project for China where the AAT project has encouraged to include saffron and dry fruits. Few saffron companies have been included in buyer-seller meeting and further capacity building initiatives. In the effort to build synergies among projects and donors, ITC was invited to develop a proposal for a small pilot project component aiming at the promotion and commercialisation of packed premium Afghan saffron towards identified buyers in export markets and a better understanding of the target buyers requirements. This pilot component, if approved, would complement a new large project Support to agricultural high-value chains in western Afghanistan requested by the Ministry of Agriculture, Irrigation and Livestock (MAIL) and Ministry of Finance (MoF) which is proposed to be funded by the Italian Government. This large project would aim to improve agricultural production, productivity and marketing of agriculture high value-chains such as saffron, dairy products, grape by approx small agro-producers in two provinces of Western Region. TF During interactions with USAID (ATAR) project personnel in Kabul, it was realized that many of the activities above are also included in their work plan. We reached out to USAID and suggested collaboration to implement some of the activities above jointly. This was received positively by all USAID hierarchies and we will be working jointly to validate the TFA needs assessments and categorizations as well as in the development of the trade facilitation implementation strategy. 68

69 8. REQUEST FOR PAYMENT To be submitted at a later stage 9. WORK PLAN FOR YEAR 2 Afghanistan: Trade-related assistance Upcoming Activities: 1 st July th June 2018 Activities Outcome: The Government formulates and implements better informed trade policy and a strategic vision to support trade competitiveness within the region. Output 1: Government of Afghanistan owns a national export strategy and action plan that was developed in a consultative process with the private sector, and has started its implementation Activity: Preliminary analysis of trade competitiveness, development agenda, existing traderelated programmes, and key trade support institutions Activity: NES Pre-engagement mission to support the setup of the NES design structures (Navigator, Core Team, secretariat, etc.) as well as to secure PaP buy-in and support Activity: Finalize preliminary audits, analysis and formalize NES design structures Activity: Mapping and assessment of the institutional trade support landscape, including a review of quality and SPS infrastructures Activity: Inauguration event and first NES Stakeholders Consultation to further assess trade performance, initiate sector selection and define national level strategic orientations Activity: Draft, finalise and translate the Strategic Trade Development Roadmap (Competitiveness assessment, sector and cross-sector selection, strategic orientations & initial recommendations) Activity: Organise Second Stakeholders Consultation to complete participative value-chain analysis of prioritized sectors and cross-sector functions (incl. Provincial consultations) Activity: Complete initial strategic recommendations and action matrix Activity: Organise Third Stakeholders Consultation to refine strategic orientations and confirm action plan for the priority sectors and cross-sector functions Activity: Consolidate, finalise and translate the National Export Strategy document (consolidation, editing, formatting) and its plans of action Activity: Organise Launching event for official endorsement of the National Export Strategy by the Government of Afghanistan Output 2: National public and private stakeholders are enabled to manage and coordinate the implementation of the National Export Strategy and mobilise support to implement the validated roadmaps Activity: Management support to establish and operationalize an effective implementation management framework for successful implementation, tracking and measurement and mobilisation of support for the implementation of the NES action plans (NES Coordination mechanism) Activity: Support the MoCI and other stakeholders with capacity- building trainings, direct Q3 Q4 Q1 Q2 Jul Aug Sept Oct Nov Dec Jan Feb March April May June 69

70 support and tools on NES implementation planning, management techniques and resource mobilisation, including a particular focus on the implementation of quality & standards related solutions. Output 3. Priority interventions identified during the National Export Strategy design process are implemented to improve regional integration and international trade competitiveness Activity: Implementation of priority interventions identified in the NES design process, potentially linked to market profiles, trade intelligence, trade visits, B2B meetings, etc. Activity: Advisory services to ANSA to develop services (standards, certification, training centre) and other Ministries and TSIs to implement priorities in the quality and SPS areas Output: Output 4: Knowledge sharing mechanisms for GIRoA staff on trade policy/negotiation formulation and implementation are established in partnership with a training institute from the Region Activity: Needs assessment for trade capacity building of MoCI and governmental agencies is conducted Activity: Governmental officers training programme is designed and implemented Activity: Training modules on trade policy are developed in cooperation with Afghan Universities Output 5: Institutional mechanisms to facilitate the implementation of the TFA are established at national level and linked with regional partners Activity: Support the implementation of the WTO TFA through technical advisory services to IMCWTF and other government agencies Activity: Support the capacity building and operationalization of IMCWTF and other public sector agencies to implement the WTF TFA Activity: Increase awareness of private stakeholders on the TFA and their ability to contribute to TFA related PPD within the IMCWTF and other fora Activity: Structure and facilitate a regional network of (existing) National Trade Facilitation Committees to encourage experience sharing as well as a coordinated and harmonized approach towards the implementation of the TFA Output 6: SME knowledge of how to manage national cross-border procedures and compliance with regional and/or global market requirements is built encompassing priority markets (building on NES findings) Activity: Conduct needs assessment of SME export management and compliance training and information requirements Activity: Develop, publish and disseminate a National Trade Procedures Guide for SMEs and entrepreneurs, in print as well as online Activity: Develop SME export management and compliance training curriculum with a blended learning approach (i.e. face-to-face sessions complemented by on the job coaching) Activity: Train the trainers to facilitate e-learning session and to deliver face-to-face trainings Activity: Organize and facilitate the delivery of four full curriculum (e-learning modules and face-to-face modules) Output 7: Public-private consultation process on domestic/regional key pressing trade policy/regulatory/ negotiation issues is strengthened Activity: Needs assessment for the operationalization of a PPD platform on trade policy is conducted Activity: Research materials/position papers through peer review (whenever local capacity exists) are produced Activity: Public private dialogue on policy /regulatory issues (bilateral/regional) 70

71 Activity: Training of private sector organizations on issues to be further addressed through public private consultations are organized - Training 1 Activity: Advisory services 71

72 ANNEX I: MEDIA REPORT Advancing Afghan Trade Newsletter The International Trade Centre (ITC) recently launched a trade-related assistance initiative funded by the European Union called Advancing Afghan Trade (AAT). Set in motion on 29 November 2016 in Kabul, the initiative intends to contribute to the strengthening of the country's trade capacities, with the long-term goal of helping to transform Afghanistan and its regional partners into a vibrant regional economic hub. The project will be implemented over a three-year period. Funded by the EU implementation of the initiative is now under-way and is led by ITC in close collaboration with the Ministry of Commerce and Industries. In this first newsletter, we invite you to read the articles below to discover the first steps already taken. These include statements from ITC's Executive Director and Afghanistan's Mister for Commerce and covers National Export Strategy developments, trade policy and trade facilitation developments and quality management. We look forward to sharing regular updates with all our stakeholders and garnering as much support from the community as possible, so please feel free to share this newsletter. It is our belief that the AAT will contribute to how trade can be used as a lever for economic growth, job creation, poverty reduction and enhanced regional cooperation. The AAT Project Team 72

73 INTRODUCING ADVANCING AFGHAN TRADE - A PROJECT TO BOOST ECONOMIC GROWTH AND REGIONAL COOPERATION By Arancha Gonzalez, Executive Director, International Trade Centre The fabled Silk Road trade routes linking the cultures and communities of East Asia, India, the Mediterranean basin, and Eastern Africa have threaded through Afghanistan for centuries. Afghanistan remains a strategic crossroad, despite the political and economic challenges that has affected the country for decades. Situated at the heart of the old Silk Road, Afghanistan is a country shaped by trade. With its huge untapped resources and export potential, Afghanistan is a country that the international community must continue to invest in. By working with Afghanistan to put in place the right policies and mechanisms, ITC aims to support the government and the private sector to build a more stable Afghanistan that once again finds its place in the global trading system. It is through Advancing Afghan Trade that ITC intends to contribute. The seeds of this project were planted in 2015 through an initial interaction between the EU Delegation to Afghanistan and ITC on how the two entities could partner on a what a regional trade project. Through close collaboration with the Ministry of Commerce and Industry (MoCI), the main stakeholder in the project, ITC developed a project idea and a roll out plan that built on its record of accomplishments in the region and in working in in fragile and post-conflict states and in landlocked countries. In November 2016, with generous financing by the EU and technical support from ITC, and with full cooperation from the Government of Afghanistan, Advancing Afghan Trade was launched to boost the country s trade capacity and to speed up the country s integration in regional and international commerce. This is an intervention with long-term impact. It will continue to boost trade capacity in the country and help translate this into greater economic growth, job creation, poverty reduction and enhanced regional cooperation. Identified priority areas for support under this project are: Trade and export strategy development Quality management, sanitary and phytosanitary (SPS) infrastructure and regional regulatory cooperation Trade policy and trade facilitation capacity building This newsletter is a small window into what we hope to achieve over the next few years. It will recount and document the project s progress and both engage and profile the various stakeholders. I take this opportunity on the launch of this first newsletter to extend my thanks to all who have helped bring this project to life and I, like you, very much look forward to seeing the progress to follow. 73

74 ITC COLLABORATION WILL ASSIST SME EXPORT GROWTH IN AFGHANISTAN By Mohammad Qurban Haqjo, Deputy Minister for Commerce, Ministry of Commerce and Industries The Government of Afghanistan recognizes international trade as an important driver of growth and has prioritized trade, transit, and regional cooperation as critical elements in its economic development strategy. This priority is strongly evidenced by the Afghanistan Development Peace National Framework, and specifically the Private Sector Development Program, which highlights We will change the structure of our economy from one of import and distribution to one where a thriving private sector - from small farmers and urban businesses to large manufacturers - can successfully export Afghan products to regional and global markets. The initiatives that we are focusing on to this aim, include: Promoting good policy and regulatory reforms to further enable export-focused Afghan-owned firms; Advancing customs-to-customs agreements with neighbouring countries; Assisting Afghan firms to comply with ISO standards; and Reducing red tape-driven obstacles. The Government of Afghanistan s commitment to unlocking the potential of the country's export sector is also demonstrated by recent initiatives for trade reform undertaken by the country, such as accession to the World Trade Organization (WTO) and ratification of WTO Trade Facilitation Agreement (TFA). We are further advancing aspirations to make the country a regional "trade and transit hub" and have been working with our closest neighbours to foster transit trade, improve trade facilitation and advance trade agreements. Thus we have undertaken very substantial policy measures and attempted to broaden and strengthen our trading relationships within the region and globally. 74

75 As we work towards our commitments for trade reform and export growth, we will require a solid understanding of trade issues, design and implementation of legislative reforms and their enforcement through institutionalized mechanisms. It is in this regard that the ITC collaboration can assist the Government of Afghanistan. The ITC-guided and European Union funded project Advancing Afghan Trade will seek to assist the Government of Afghanistan to implement its WTO commitments and use trade as a lever for enhanced regional cooperation, economic development, and poverty reduction. Moreover, benefits of accession to the WTO are not automatic, and there are a number of post-accession initiatives and reforms that a country needs to undertake to increase its competitiveness and integrate into the global economy. Towards this end, and with the support of this project, we will: Negotiate and formulate trade policy and trade facilitation reforms; Design and implement a National Export Strategy; Understand and simplify cross-border procedures encountered in international trade; and Formalize mechanisms to engage in public-private dialogue. Since launching the project, we have already received positive responses, and we very much look forward to witnessing the growth that will ensue as we work towards the goals of this project and our broader trade commitments. PROJECT WILL SUPPORT INSTITUTIONS TO DELIVER ON AMBITIOUS REFORM AGENDA By Franz-Michael Mellbin, Head of European Union Delegation to Afghanistan With the "Advancing Afghan Trade" initiative the European Union is committed to supporting Afghanistan in benefitting from the opportunities arising from greater participation in international trade and enhanced regional economic relations. Accession to the World Trade Organization (WTO) in 2016 was a landmark achievement for Afghanistan; however, complacency is not an option - significant work lies ahead in legislative and regulatory reform and rigorous implementation of WTO obligations. 75

76 It is urgent now for Afghan institutions to deliver on the ambitious economic reform agenda outlined in Afghanistan's National Peace and Development Framework. Trade is a major tool for economic development and promoting employment. The country has substantial potential to develop a competitive exports sector as one of the key drivers for growth and jobs. This potential is currently constrained by bureaucratic inefficiencies and red tape. To harness the opportunities offered by international trade and investment the Afghan Government needs to put in place, in close interaction with the private sector, enabling business environment policies: e.g. on exports procedures, taxation, business registration and licensing, transport, logistics, customs, etc. It is important to bridge the existing gap between the public administration and the business community by establishing a collaborative partnership and fostering reliable, cost-effective, responsive and businessfriendly service delivery. Moreover, building bridges, connectivity and enhancing trade relations within the region is of strategic importance for the economic development and stability of Afghanistan and its neighbours. Costs for trade in the region are among the highest in the world. A regional approach to trade facilitation and tackling burdensome and costly regulatory requirements has the potential to boost trade and investment to the benefit of the whole region. Afghanistan's neighbours should do their share to ease trade with Afghan exporters and to dismantle existing barriers to trade, transit, and transport. The countries in the region are better off trading together, with thriving cross-border businesses relations. The EU is confident that our Trade-Related Assistance initiative "Advancing Afghan Trade" - in partnership with the Ministry of Commerce and Industries, the business community and our implementing partner, the International Trade Centre - will strengthen trade institutions in supporting efficiently the private sector, as well as in advancing much-needed regional trade cooperation. NATIONAL EXPORT STRATEGY ADVANCEMENTS By Eric Buchot, Output Head, Export Strategy, Advancing Afghanistan Trade The joint efforts of the Government of Afghanistan, private sector groups and ITC to develop a National Export Strategy for the country are taking concrete shape. After the first consultation with stakeholders in Afghanistan, our team has taken a step forward in developing the National Export Strategy (NES) for advancing Afghan trade competitiveness. ITC is certainly well prepared to meet the challenge. Given the regional knowledge (for example, having worked to advance regional integration in Kyrgyzstan, Tajikistan, and Pakistan), experience in working in post-conflict zones and engagements with Landlocked Developing Countries, the ITC is in a strong position to undertake this initiative. 76

77 For a country mired in challenging security and economic conditions, the Government of Afghanistan and the private sector have an inspiring vision to position Afghanistan as an important trade partner for the region and beyond, through export-led growth. The first NES stakeholders consultation was held on February in Kabul, with attendance from over 200 public, private and international stakeholders. The success of the first consultation has already resulted in a consensus reached on key competitiveness issues and sector-specific priorities, including for products such as fruits and vegetables, Saffron, marble, carpets and other high potential sectors. Grand design, grounded in reality and country-ownership The NES is the product of a rigorous, analytical process that aims to be participatory and inclusive. In fact, throughout the 8-month design process, over 30 institutions and 500 stakeholders representing the public and private sector, civil society actors and international development partners will be participating. The NES s national scope will ensure that several key production and trading hubs including Mazar-e-Sharif, Herat, Jalalabad, and Kandahar are included in the strategy design process, beyond Kabul. ITC Executive Director Arancha Gonzalez notes, "The Strategy will provide a guiding compass for a series of strategic actions including investments, value-chain development, institutional support mechanisms, and improvement of Afghanistan's regulatory environment." In spirit, and in action, the NES will be aligned to the national goals established by the Cabinet and the High Economic Council in areas related to socio-economic growth, private sector development, investment promotion, investor protection, economic diversification and others. The ITC methodology, specifically customized to the requirements of Afghanistan, will ensure that this overarching and incontrovertible principle is followed throughout the NES design and implementation process. It will be developed under the co-leadership of the Ministry of Commerce and Industry (MoCI) and Afghan Chamber of Commerce and Industry (ACCI), in close collaboration with Ministry of Agriculture Irrigation and Livestock and Afghan National Standards Authority, and with the technical support of ITC. Complex considerations are recognized To be sure, trade will not be a panacea, and there are complex considerations in place. Economic growth in all services, agriculture and industrial segments is stagnating, investments are declining, and the private sector is struggling to satisfy the needs of the domestic market as well as the select international markets. The business and investment climate needs urgent reforms, enablers and competitiveness drivers such as Quality Management, Trade Facilitation, Human Capital Development and Access to Finance need significant support, as do national institutions that have been weakened through decades of conflict as well as relative neglect by international aid. Corruption will continue to remain a long-term challenge. Despite these considerations, however, the business case for an NES remains strong and enjoys robust support from the public and private sectors. Mohammad Haqjo, Afghanistan s Deputy Minister, MoCI, has been actively involved in the NES development, acting as the Navigator of the strategy. He reflects the importance of the NES seeing the strategy as a business-oriented roadmap that will serve to tackle long-lasting issues and best grasp evident market opportunities. Atiqullah Nusrat, Chief Executive Officer of the ACCI, says "The development of an NES is a high priority item that is foreseen to stimulate the growth of the private sector in addition to providing a high degree of mobility and stability. It is a much appreciated and timely Endeavour that is fully supported by the ACCI." Robust support anticipated by international partners Donors and international development partners are taking note. In an unprecedented meeting before the 1st consultation, several donors including the EU, USAID, GIZ, DIFD, UNAMA, and others discussed ways and means to support the NES as well as align development efforts for private sector development. Franz-Michael Skjold Mellbin, Ambassador of the European Union to Afghanistan, echoes this sentiment: "Moving forward the private sector development agenda must be a priority for Afghanistan if it wants to shift from aid dependency towards sustainable growth and job creation. The National Export Strategy will guide Afghanistan's efforts to realize the potential of its exports sector as an important driver for economic growth." Current development As we move ahead with the NES, we will be working towards fulfilling the following three key outputs, in brief: 77

78 1. Afghanistan owns an NES and action-plan developed with the private sector. 2. National public and private stakeholders are enabled to manage and coordinate the implementation of the NES. 3. Priority interventions identified during the National Export Strategy design process are implemented. TRADE POLICY ADVANCEMENTS By Jean-Sébastien Roure, Project Manager & Output Head, Trade Policy, Advancing Afghan Trade Context In July 2016, Afghanistan acceded to the WTO, and with it came much anticipation for the country s integration into the global economy. As a WTO member, Afghanistan can benefit from access to new markets, inclusion in global supply chains and lower tariffs that officials hope will ultimately lead to more competitive industries and higher wages. Free trade can also allow local businesses to purchase inputs at lower costs leading to more competitive prices for manufactured goods. Yet the benefits of accession to WTO are not automatic, and there are a number of initiatives and reforms that a country needs to undertake to increase its competitiveness and integrate into the global economy. These initiatives include strengthening the capacity of domestic institutions; improving the business environment to enable enterprises to capture market access opportunities; implementing regulations resulting from WTO commitments; and trade-enabling reforms. What we aim to do The AAT trade policy output seeks to assist the Government of Afghanistan in fully benefiting from WTO membership. It will do this through two specific outputs: Reinforcing the skills of government officers working in trade-related ministries and implementing agencies on issues related to trade policy, regulatory reform and trade negotiations. Promoting comprehensive, regular and well-informed public-private consultation among the government, private sector, and civil society and research institutes for trade policy development, monitoring and evaluation. The consultation process, which is established and maintained simultaneously with the strengthening of technical skills of stakeholders, will act as a powerful means to aid policy formulation and implementation. 78

79 We will be working on several priorities to further deliver these outputs. This will include staging regular stakeholder consultations on trade policy and negotiation issues to identify reforms both domestically and between countries in the region as well as implementing a continuous government officer trade policy training programme. These interventions aim at increasing technical skills on trade policy and producing policy reform options, which once implemented will enable the government to achieve firm-level export competitiveness and enhance growth and development. Progress already Upon the request of the MoCI, ITC is commencing a range of activities aimed at building a pool of experts (mainly MoCI government officer) in a wide range of trade issues (trade policy formulation/implementation, trade facilitation, investment, trade in services, regulatory reform, trade negotiation, etc.) along with developing high-level learning curriculum.. To aid this, In March 2017, Afghanistan s MoCI and the Indian-based Centre for WTO Studies (CWS) entered into a partnership for the capacity building of MoCI. CWS will assist MoCI in capacity building activities to strengthen the ministry s technical capacity and training capabilities. Once developed throughout the course of 2017 and 2018, trainers and curriculum will then be utilised to further train staff from MoCI, trade related ministries/agencies and beyond. Additionally, the programme is assisting to develop a national trade policy document, which will set out the policy approach for the next five-year period. It will provide an evidence-based, structured and coherent approach to enhance Afghanistan s trade competitiveness and benefit from the increasing insertion into the global economy. This is a significant development since to date Afghanistan has not had a national trade policy, thus once completed the document fills this important gap in the country s policy landscape. Stakeholder consultations on its contents are to occur in 2017 before its finalisation. TRADE FACILITATION ADVANCEMENTS By Pierre Bonthonneau, Output head, Trade Facilitation, Advancing Afghanistan Trade Thanks to Afghanistan s recent accession to the WTO and ratification of the Trade Facilitation Agreement (TFA), we are placed in a favourable position to implement Advancing Afghan Trade (AAT). As part of the AAT initiative, our team s task will be to mobilize all key stakeholder groups including policymakers, the private sector, and trade support institutions to build capacity and national momentum towards the implementation of TFA. On 22nd February this year, the WTO Trade Facilitation Agreement (TFA) entered into force after two-thirds of the 164 members of the WTO ratified it. It is the first multilateral deal concluded in the 21-year history of the WTO and will now make it obligatory for the members to streamline customs procedures, reduce the time and cost of cross-border trade and make exporting and importing more transparent and predictable. One of the results, according to OECD studies, is that developing country exports are expected to grow between 14% and 22% while becoming more diversified. In the case of Afghanistan, the country ratified the TFA shortly after acceding to the WTO in July 2016 and will now need to implement trade facilitation reforms. They will be able to benefit from the special flexibilities in the 79

80 TFA for developing countries and least developed countries (LDCs) regarding implementation timelines and dependence on technical and financial assistance. Trade facilitation reforms are much needed in Afghanistan to boost the competitiveness of its exporters as the country currently ranks 175 out of 189 countries in the World Bank s Trading Across Borders Index. The cost to export is over 44% higher than LDCs and SAARC average and the time to export is even higher at almost 60%. This is where our team comes in. Having provided technical assistance to over 50 countries in the area of trade facilitation, ITC recognizes that TFA implementation is not solely the government s responsibility but also that of the domestic businesses and trade support institutions. As a result, our team s interventions will include the following actions: 1) Afghan Policymakers: categorizing and notifying TFA commitments; developing TFA implementation strategy and action plan; building capacity of NTFC members through targeted training, regional events and study tours; and supporting the operationalizing and functioning of the NTFC. 2) Businesses: ITC s interventions will focus on the SMEs and will include: training of SMEs (and others) on the WTO TFA s use and benefits; development and dissemination of guides on export procedures; and development and delivery of customized training and coaching curriculums for SMEs to engage in cross-border trade. 3) Trade Support Institutions: ITC will engage relevant organizations to partner on capacity building initiatives of the project to ensure long-term sustainability and maximize the outreach of the trainings in Afghanistan. These will include train-the-trainer approaches and handing over of training and coaching methodologies, which can be replicated many times after the project ends. The trade facilitation component of AAT will also seek to build synergies with other components of the project. This includes capacity building of private sector representatives on business advocacy and participating in the reforms process to engage in public-private dialogue. The trade facilitation implementation strategy will also be included in the National Export Strategy of Afghanistan. Additionally, ITC will strive to build synergies with other development organizations working on the ground in Afghanistan on trade facilitation-related projects to ensure that we can pool resources and maximize the positive impact of our respective goals. 80

81 QUALITY MANAGEMENT ADVANCEMENTS By Ludovica Ghizzoni, Output head, Quality Management, Advancing Afghanistan Trade Quality management and SPS infrastructure ultimately support SMEs to prosper, acting as a valuable element in the success of Advancing Afghan Trade (AAT). Our team intends to enhance a conducive technical environment and strengthen Afghan SMEs knowledge and capacity to comply with regional and international market requirements while improving the quality and safety of products and helping revitalise Afghanistan s trade sector. Quality is a prerequisite for successful market access and increasing revenues from export, but meeting technical requirements in the international marketplace is a challenge for many exporters. According to ITC research, approximately 56% of the problems faced by exporters are in the area of technical barriers to trade (TBT) and sanitary and phytosanitary measures (SPS). ITC experience suggests that exporters in developing countries experience four main challenges to overcoming technical barriers to trade and in accessing new markets: 7. Obtaining information about the mandatory technical regulations and voluntary standards applicable in the importing country; 8. Adapting their products to meet these requirements efficiently; 9. Demonstrating that the products meet the relevant requirements; and 10. Obtaining the necessary support at each step from the national quality infrastructure, which in many developing countries is not up to standard. Source: International Trade Forum - Issue 3/2010 Thus strengthening quality infrastructure, albeit a complex, expensive and time-consuming, is a crucial element in ensuring the competitiveness of the export sector. Afghanistan is no different in this respect. During the ITC needs assessment missions stakeholders have 81