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    Working Our Network

     

     
     
    © International Trade Centre, International Trade Forum - Issue 1/2002

    Participants at the ITC Executive Forum 2001 in September were asked: is your network working? They could have turned the question back to us and asked ITC: is your own network working? Our answer would have been: yes, most definitely.

    The Executive Forum on National Export Strategies started in September 1999 as an innovative experiment in South-South technical cooperation. On the shores of Lake Geneva, we gathered together leading strategy-makers and business people from 30 developing and transition countries for three days of intensive brainstorming. We hoped to develop some guidelines for best practice in designing and managing a national export strategy. In a commercial world where big fish eat little fish, but where fast fish quickly leave the slow fish behind-big or small-we felt that by working together we could perhaps give some slower fish the strategic tools to swim a lot faster-and help them to go in the proper direction.

    ITC has a long history of practical work with developing countries, giving managers of public and private sector trade support institutions (TSIs) the information and tools they need to assist local companies to be better exporters. We have a good track record of providing market data and studies, operating guidelines and training kits to our developing country partners. All of these are worked out in close conjunction with institutions in the countries themselves, so that we are not just passing on knowledge, but also using and developing local expertise in a true partnership. We do not carry out this effort alone. In many cases we work with others in the United Nations family.

    The product-network approach

    Our concern is not just to produce these competitiveness support products, but to ensure that national trade support institution networks receive the backing to adapt our competitiveness tool kit to local requirements. This is our product-network approach - and it is working. By the end of 2001, specialized product-networks were operating in more than 120 developing countries and economies in transition.

    The Executive Forum represents the next step in the product-network approach. Its objective is to build on these operational support tools and to develop best-practice scenarios at the strategic level. The Executive Forum itself was innovative because it was aimed at the strategy-maker rather than the practitioner, and deliberately gathered together government, TSI and business community leaders. We recognized that it was not enough to simply assemble TSI executives, because few of them play the pivotal role in conceiving and developing strategy.

    At the same time, we realized that they are key to strategy implementation and therefore must be brought into the picture at the earliest possible stage, as should the business community. We also recognized that our network partners in developing and transition countries not only need best-practice guidelines for putting together a strategy; they also have a great deal of grass-roots experience to share. For its part, ITC needed to tap into this knowledge to learn what it should be doing to help improve the national strategy-making process. In what became the pattern for subsequent Executive Forums, the emphasis was on analysis, experience-sharing and networking. We also deliberately avoided being prescriptive in approach.

    Changing perceptions of trade promotion

    The first Executive Forum, which focused on the theme Redefining Trade Promotion: the Need for a Strategic Response, was an experiment because, at that time, trade promotion strategy-making was not a priority concern for developing countries. Even three years later, very few developing countries have put a national export strategy in place. However, the reali-zation is growing among trade promotion organizations and specialized TSIs that a strategic approach is critical.

    To provide a starting point for discussions we presented participants with a number of case studies setting out the strategies which successful exporting countries in the industrialized or developing world (whether Finland or the Philippines) had adopted. All of this was available on our web site (http://www.intracen.org/execforum) well before the consultation. The lessons are still valid and the case studies continue to be available on our web site.

    Redefining roles and strategies

    The three days of discussions made it clear that to keep up with the rapidly changing environment, national strat-egies must be redefined and TSIs must embrace new roles. In order to be effective, a national export strategy must be comprehensively integrated into the overall economic planning framework. It should not simply deal with developing commercial opportunities in international markets. It should also encompass the longer-term "border-in" challenge of establishing a national competitiveness framework which would create an export culture, sharpen business competitiveness and develop new export industries. The experiment was a success. The relevance of an export strategy which addressed "border-in" and "border-out" issues was acknowledged. The notion of a global network of global strategy-makers was born.

    Expanding the Executive Forum reach

    One clear concern among strategy-makers in developing and transition economies was the national challenge posed by the global digital revolution. For some, simply getting an overall picture of the new e-world of commerce was difficult, let alone predicting the future, or seeing what strategy-makers should be doing to make their exporting community e-aware and e-competent.

    Export Development in the Digital Economy became the theme of Executive Forum 2000, and the ITC network was broadened to include national strategy-makers concerned with developing telecommunications strategies. Equally important was the fact that we applied cyber-technology ourselves to extend our outreach and to stimulate further development of our network. A series of e-discussions was organized to support the Executive Forum debate. Some 600 participants from 85 countries joined in. What started out as a single event was already turning into a network of interested professionals. It also gave us a pattern we could apply to other ITC activities, such as the Business Sector Round Table organized for the United Nations Conference on the Least Developed Countries in May 2001 in Brussels, Belgium.

    Ensuring the network promotes trade

    Executive Forum 2001 tackled strategy implementation: the logical follow-up to such concerns. Of course, an effective strategy formulation process is essential. It is also fundamentally important to ensure that the formulated strategy addresses major shifts in business practice, such as e-trade. But the proof of the pudding is in the eating. Is strategy effectively implemented? That was the focus of the Executive Forum 2001 debate, which posed the question: Is Your Trade Support Network Working?

    Different national approaches to implementing strategies were analysed. Mr. David Syz, the Swiss Secretary of State for Economic Affairs, explained in detail why Switzerland has devolved responsibility for trade support services to the private sector.

    From Canada, we heard how the federal Government has segmented the business community into "potential", "preparing" and "experienced" exporter categories and has established separate institutional networks for each group, all linked in cyberspace.

    Going international

    The key point made in all discussions was that one size doesn't fit all in developing strategic solutions in trade promotion. But the strategy-maker must be aware of all the options. Who should coordinate the national trade support network? How should it be financed? Is the one-stop shop approach (or, in cyberspace, the one-stop screen) an effective model? Should trade and investment promotion be merged into a single network?



    The challenge for the national trade promotion organization
    The challenge confronting the national trade promotion organization is to develop a new set of services, or to facilitate specialized trade support institutions providing such services. The orientation of such programmes should be towards:

    • developing the overall competitiveness of the enterprise, rather than increasing its immediate export sales;
    • supporting industry associations and clusters of firms, rather than concentrating on the individual enterprise;
    • providing long-term support, rather than one-off assistance;
    • developing capabilities, both production and managerial, rather than simply marketing competence; and
    • promoting technology acquisition, investment and subcontracting, rather than focusing on just "getting the goods out of the country".


    From Redefining Trade Promotion-the Need for a Strategic Response (2000)



    A full exchange of ideas

    Executive Forum 2001 proved a very business-like gathering, with national groups participating in break-out sessions to outline their priorities, needs, objectives and measures to be taken. The 2001 meeting was more than a simple dialogue. As we had always planned, it was a full exchange of ideas among professionals on the issues of their profession. One participant suggested that through the Executive Forum on strategy-making, ITC was turning what had been an art into a science.

    We are not there yet. But we have certainly expanded our scope once more. The 2001 Executive Forum was followed by the first Regional Executive Forum at the end of November in Nairobi, Kenya. It shared the best-practice ideas from the Montreux Executive Forums with representatives from eight eastern and southern African nations. It also obtained additional feedback about the support required to enable TSIs to implement strategies effectively.

    Lessons learned

    Similarly, this issue of Forum takes our effort a step further. It is not so much a report on the Executive and Regional Forums, but rather a quick panoramic look at the lessons learned in trade promotion; from the craft firm to the strategic level. It also offers snapshots of national, industry and company experiences that may help our readers from all groups to understand the issues and how the ideas apply in practice.

    We were heartened to hear that readers have already used Forum material to find their own niche in international markets and we would like to see this issue of the magazine make a similar contribution to better business for developing and transition economies.

    For this reason, the Market Profile in this issue concentrates on artisanal products, one of the obvious sectors where rich or poor countries have their own individual marketable products. The message is that, if approached in the right way, it is fairly easy, or at least possible, for a network in this sector to be effective and efficient.



    Elements of a viable national competitiveness framework
    • A stable, predictable, macroeconomic environment for enterprise development characterized by low budget deficits, tight inflation control and competitive real exchange rates.
    • An outward-oriented, market-friendly trade and industrial regime emphasizing the dismantling of import controls and tariffs.
    • A proactive foreign investment strategy which targets a few realistic sectors and host countries, views overseas promotional offices as public-private partnerships, and provides competitive investment incentives and streamlined investment-approval processes.
    • Sustained investment in human capital at all levels (particularly tertiary scientific, information technology and engineering education) and increased enterprise training (including assistance for industry associations to launch training schemes, information campaigns to educate firms about the benefits of training and tax breaks for training).
    • Comprehensive technology support for quality management, productivity improvement, metrology and technical services for small and medium-sized enterprises or SMEs (including grants to obtain ISO 9000 certification), the creation of productivity centres and commercialization of public technology institutions.
    • Access to ample industrial finance at competitive interest rates through prudent monetary policy management, competition in the banking sector, training for bank staff in assessing SME lending risks and specialist soft loans for SMEs.
    • An efficient and cost-competitive infrastructure with respect to air and sea cargo, telecommunications, Internet access and electricity.


    Contributed to the 1999 Executive Forum by Ganeshan Wignaraja of the Commonwealth Secretariat, London.



    New ITC book and CD-ROM

    In a forthcoming publication on the more strategic complex questions, we will set out the broader considerations at greater length.

    This is the third in our series of Executive Forum publications, and will also include a CD-ROM of useful material from the three Forums held so far. The CD-ROM will be arranged in an easy-to-use format for all strategy-makers. With all of these products, we hope to export the network idea well beyond the borders of trade support institutions and bring businesses, as well as government ministry planners, within the net of strategy development and implementation.

    We believe that without a network linked by continuous dialogue, any trade promotion effort, particularly one focused on poverty alleviation-something more and more donor organizations are beginning to demand-is bound to fail. Of course, we would rather have them succeed; certainly our future development of the Executive Forum process will be designed to help move developing and transition economies along the path to success. To produce this result, we will keep working our network-and keep our network working.

    The Swiss State Secretariat for Economic Affairs (seco) has been our solid partner for the last two Executive Forums. I wish to thank them publicly for their ongoing support. Certainly seco is at the centre of the ITC network.

    J. Denis Bélisle is Executive Director of ITC.