Lao PDR Second Trade Development Facility Project

closed

The objective of the Second Trade Development Facility Project for Lao People's Democratic Republic is to support the implementation of government's trade and integration priorities outlined in the 2012 Diagnostic Trade Integration Study, or DTIS roadmap, and in particular to contribute to improved competitiveness and diversification, focusing outside the natural resource sectors. There are three components to the project, the first component being trade facilitation, trade policy, and regulations. This component builds on the success of trade facilitation and trade policy activities under First Trade Development Facility (TDF-1), and will consist of a number of inter-related activities aimed at improving transparency, predictability and lowering associated compliance costs for traders. Trade facilitation activities will focus primarily on improving inter-agency coordination and supporting the adoption of modern risk based approaches to managing regulatory compliance in non-customs agencies, including reform of non-tariff measures. The second component is the diversification and competitiveness. This component includes a new set of activities aiming to support improved private sector capacity to improve productivity and compete in international markets, focusing on the non natural resources sectors (in particular outside of mining and hydropower). Activities will facilitate the more effective participation of small and medium sized enterprises in the international economy, better skills and labor standards in the manufacturing sector and support to women's economic empowerment. Finally, the third component is the mainstreaming aid for trade. This component will provide for support to the next generation of Lao PDR's 'aid-for-trade' governance framework as part of efforts to move to a full program based approach for trade and private sector development. The project is financed via a multi donor program, including a multi donor trust fund grant with contributions from Australia, the European Union, Germany and Ireland, and a grant from the World Bank/International Development Association.