Changes in the external environment Over the past four decades, ITC has built a reputation as a centre of excellence for trade-related technical assistance and capacity building. Since ITC was created in 1964 (as the first provider of trade-related technical assistance), trade has dramatically grown and the participation of developing and transition economies now accounts for about 45% of international trade. However, during that same period, progress has been unequal. This is especially the case in Africa – by 2008 the African share of world trade in 2008 had fallen to around 3%.
A large portion of the world is therefore excluded from the benefits of globalization.
It is now accepted that trade, essentially conducted by the private sector, can be a powerful tool for development. It is vital to expand the participation of developing country business communities in the global economy. The creation of a sustainable export support infrastructure in developing and transition countries has become a major objective of most development agencies and donors. As a consequence, the number of trade-related technical assistance (TRTA) providers has expanded dramatically since ITC’s inception.
The 2005 Paris Declaration placed emphasis on enhanced Aid Effectiveness.
This creates a new environment where developing countries and LDCs will increasingly have the decision-making role to integrate viable trade-related projects into their development programmes and poverty reduction strategies. Therefore, ITC is evolving in a much more complicated and competitive environment, with ITC Change Management Report 3 higher quality requirements, where it will be necessary to work more effectively with multiple partners.
In addition, donors and beneficiary countries are increasingly looking for impact rather than just output and higher levels of value for money and accountability. 2. 2 External ITC evaluation The 2006 ITC evaluation sponsored by Denmark and several donors, thereafter “the Danish Report”1, is a complex set of 24 separate thematic or methodological documents plus a synthesis report.
The evaluation identified the challenges faced by ITC in the context of the changing environment, and proposed recommendations for meeting these challenges. The evaluation therefore triggered the subsequent change management process.
The evaluation stated that since ITC received half of its operational budget from extrabudgetary sources, harmonization of donor support for ITC was a priority for improving overall programme coherence and effectiveness. It also recommended the re-examination of ITC’s governance framework, which “over time … has become attenuated and fragmented”. From an operational perspective, the evaluation recommended that ITC should apply an “MDG lens” in the design and implementation of its projects, and it identified two main interconnected shortcomings requiring a change at ITC: ?
More country-specific projects – The document called for “an increased scale of activities with greater priority for country programming would help to achieve better utilization of ITC products and could improve the return on the investment in the fixed costs of developing these products.
” More systematic needs assessment – The document described a fragmented supply driven situation marked by the “proliferation of products or brand extension, some of which may be supply driven from the various sections of ITC, and some of which may be responsive to donor preferences. ” ?