The objective of the brainstorming session was to develop "propositions on best practice" which would be presented and debated at the 26-29 September Executive Forum consultation in Montreux, Switzerland.

A variety of views were expressed during the brainstorming. In several instances, opinions on "best" and "suitable" practice differed. Yet there was consensus that:

• The national export strategies of most developing/transition economies fail. This is in part due to weaknesses in their design. Yet the failure of national strategies is principally due to weaknesses in their implementation. The network of trade support organizations concerned with implementing the national strategy does not work effectively. In many instances, it does not work at all. In short, the requisite "central nervous system" does not exist to stimulate the creation and delivery of those trade support services upon which the success of the national strategy is dependent.

• For implementation of national export strategy to be successful, a structured and coordinated trade support network is required. Formal structure may not be essential. Formal coordination is, nevertheless, essential. The key ingredient of any successful network is the belief shared by all members that it is in their interest to participate, and participate actively. Network membership will, therefore, vary depending on the objectives targeted and tasks involved. The national trade support network will likely consist of a number of informally structured, but formally coordinated sub-networks.

• Differences in national circumstances suggest that there may be few "best practices" that govern the composition and structure of the national trade support network. There are, nevertheless, operational and coordinative approaches and solutions that have universal, or common, relevance to the export strategy management and trade support networking processes of all countries. It is these approaches that could be deemed "best practice".

• Facilitating and supporting the linkage between trade and finance is likely to be the first "best practice" consideration of any national export strategy-maker and trade support network.

The key points and recommendations on "best practice" made by participants at the brainstorming session are summarized below. Some of these may be contradictory. Others may lack universal relevance. Which, if any, of these actually represent "best practice" will form the basis of debate at the forthcoming Executive Forum in Montreux.

• Focus

• While the national strategy-maker must be concerned with the commercial success of the individual exporter, top priority must be given to the "aggregate issues" of sustained export growth, targeted support to sectors with long term prospects and higher value-added possibilities.

• The national strategy-maker must be concerned with "wealth creation" (i.e. supporting private sector efforts to expand export capacity and improve international performance) and "wealth distribution" (i.e. ensuring export capacity is suitably distributed throughout the country and that the benefits of improved export performance are shared with civil society).

• The strategy-maker's network must be geared towards increasing national competitiveness. It should focus on supporting the development of export capacity, promoting this capacity in international markets and reducing transaction costs.

• Composition

• The national strategy-maker's network must address the linkages between trade and production, trade and infrastructure, trade and investment, trade and finance/national revenue, trade and technology, trade and education and export trade and import trade.

• Coordination

• While the initiative to ensure that the national trade support network is "working" should lie with the Ministry of Trade (or equivalent), it will require the direct participation and active support of other national strategy-making ministries and agencies, each with different preoccupations. Overall coordination of this national network by a "super body" is therefore an essential.

• Orientation

• National strategy-makers must ensure that the bureaucracy moves from control, to facilitation, to promotion. Similarly, the national strategy-maker must ensure that "initiative within the network" moves from the public sector to the private sector and away from the operating mode of "bureaucrat down" to "exporter up". The viability of the network, and the national export strategy overall, will largely be determined by the initiative taken by business associations.

• The national trade support network must also address "indirect" export opportunities: specifically the development of "backward linkages" within priority export sectors. This is one of the several reasons that the strategy-maker must consider the trade promotion and investment promotion functions to be inextricably linked.

• Contribution to National Development

• The "mainstreaming" of trade into overall national economic planning is critical to the key concerns of poverty alleviation and employment generation. National export strategy and the composition and working of the national trade support network should not, however, be predicated on these social concerns. "Social programmes don't lead to exports, exports lead to social programmes." In other words, national export strategy must be based maximizing commercial gains from comparative and competitive advantage. Issues of poverty alleviation, employment generation, etc. are best addressed under individual sectoral strategies that should be part of the national export development strategy.

• Performance Assessment

• Basic "verifiers" as to whether or not the strategy-maker's network is working are: the existence of a national strategy (in written form); existence of a "super body" to coordinate the network and to monitor strategic targets; and quantitative and qualitative instruments to measure the performance of the individual institutions and programmes that comprise the trade support network servicing the individual exporter.

• The more institutions there are in a national trade support network, the less effective it is.

• The trade support network must "segment its market". It must focus on two target audiences: the established exporter and assist him answer the question "who can I sell to and how?"; and the prospective exporter and assist him answer the question "what and to whom should I export and how?" The first part of both questions relates to the network's information function. The second part of the question covers all other components of the exporter's trade support network.

• Network Access

• From the exporter's perspective, the "first point of contact" with the network should not be the government.

• The national trade promotion focal point concept has considerable merit. But generally in developing/transition economies, such organizations do not "work" effectively. One of the reasons is that they try to achieve the impossible, i.e. to deliver all services to all exporters. A more effective approach is for the national trade promotion organization (TPO) to provide a referral service to other "competencies in the network". But to be of value to the exporter, this referral service must be primarily "virtual fronted by a human face."

• Ideally the first point of contact organization would have the capacity to provide financial services as well as basic information and referral services to other specialized members of the network (or, indeed, to other networks). At the very least, the first point of contact organization should have strong linkages with (and have the confidence of) the banking sector. It should help in assessing the exporter's financial needs and provide a "hand-holding and follow-up" service.

• While the exporter's trade support network should be "horizontal", consisting of separate, specialized agencies and services, there must be a "driving force" behind it. This should take the form of a "first point of contact" organization that caters to the exporter's priority "demands" - information and finance - and coordinates (or facilitates) the delivery of other support services.

• Each institution/component of the network should have a referral service.

• Needs versus Demand

• To ensure long term competitiveness of the firm, the trade support network must address the issue of "needs" as well as demand. The network must therefore possess the competence to "assess" needs and to respond to needs at the pre-transaction, transaction and post-transaction phases. There must be a road map of where the exporter gets what.

• A prime need within the business community is the need for competence within the individual firm to take maximum commercial advantage of the information and financing made available through the national trade support network. This is often the weakest part of the firm's operations. It is also the weakest part of the national trade support network's delivery capacity. Most national trade support networks simply do not possess the management training capacity, and experience with the "real world", to service this need effectively.

• A separate approach to servicing "needs" must be adopted to that of servicing "demand". Servicing demand should be "income generating" to the network. Servicing "need" requires a "partial cost recovery" approach.

• Day-to-day dependence of a trade support institution on public sector budgetary support is a fundamental weakness. Income generation opportunities must be open to network members. This can be effectively achieved by granting the network member income generation assets (e.g. permanent exhibition facilities).

• Depth of Support

• The exporter's trade support network must avoid getting involved with "micro" management of the individual firm. It must avoid getting directly involved in solving the firm's problems (in order to avoid liability in situations when solutions recommended were inappropriate). The network must, nevertheless, be geared to supporting decisions taken by the firm's management.

• The Network's Information Component

• "Connectivity" and access to the Internet do not diminish the importance of the network providing trade information to the exporter. The nature of this support service has however changed radically with the Internet. But national trade information services are, by and large, failures in developing/transition economies. They are overly-centralized, overly-bureaucratized, under-skilled, technologically-deficient and supply, rather than demand-driven. This should be of paramount concern to the national strategy-maker (and, of course, to the individual exporter) as the answer to the question "Is my trade support network working?" lies first and foremost in the network's ability to provide relevant information (and to respond effectively to the new opportunities offered by cyberspace). 

• One trade information service (or organization) is unrealistic. The network must service the trade information need through a public-private sector "consortium approach." Networking in trade information is, moreover, not just a national activity; it involves a multi-network, global effort. Technology and skill to utilize the technology are the keys to successful networking.  They are not on their own adequate to ensure a successful network information component.  

• The network should provide a "tailor-made information service" and charge for it. It should be able to respond to the challenges of "importer obsolescence".

• The Network's Finance Component

• The cost of finance is not a major constraint to export development. In most developing/transition economies the constraint is more the availability of finance (pre- and post-shipment). Similarly, in the majority of developing countries, a variety of export-related finance schemes are in place to improve access to funds. It is, consequently, the failure of the network to ensure that these schemes are effectively implemented that represents the principal weakness in this area of export support. The responsibility of the network is therefore to train - the lender in risk assessment and the borrower in risk-management - to lend and to monitor utilization. The network must also "reward good performers."

• Finance cannot be a "stovepipe" function. The network must technically support the exporter at the pre-loan stage with the objective of minimizing risk. The network must also work towards ensuring loans cover capital investment, a portion of operating costs and a "quality allocation".

• One principal reason behind the high cost and limited accessibility of finance is the perceived risk by the lender of the borrower's inability to "deliver the export promise". A significant element of risk is the exporter's ability to obtain inputs on an as needed basis. Yet, few developing/transition economy firms have full control over their own supply chains. The network must address directly the issue of "supply chain management" at the levels of the firm and the export community as a whole. Again, this highlights the importance of a national "trade facilitation" infrastructure.

• The Network's Supply Chain Component

• Supply chain management encompasses the issue of trade facilitation (import procedures and documentation and customs clearances). Very few countries are giving the development of the network's "supply chain management" element adequate attention. The consequences will be dramatic, particularly in the new era of "e-business/e-trade."

• The Network's Market Acceptance Component

• The network must provide support through information on international technical standards, facilities to confirm conformity to these standards and assistance to adapt products to export market specifications. This requires the creation of SQAM infrastructure: i.e. infrastructure covering product Standards, Quality assurance, Accreditation and Metrology (i.e. measurement traceability). Infrastructure and programmes on standardization, accreditation and measurement traceability lie within the domain of the public sector. Responsibility for quality assurance/conformity assessment infrastructure lies with the private sector.

• While there may be no best practice in the creation and operation of SQAM infrastructure, there are several fundamental givens. Two of these are: the network should endeavour to influence standards; and international networking among certification bodies is essential to obtain multiple certificates.

• The Network's Value-Addition Component

• The trade support network must work towards increasing the value-added on exports. To do so, the network must recognize that "technicians make products, managers make offers". To achieve value-added, innovation is essential. But innovation is not limited to technical considerations; it encompasses the overall approach to the market…i.e. the offer. The network should encourage managers to export the product and provide a complementary "service package" which reduces the transaction cost to the buyer.

• The Network's Promotional Component

• Innovation is most needed in the network's approach to promotion. Information and communication technologies have revolutionized what the trade support network should do, and how it should be done.

• E-promotion is perhaps the best example. Ensuring e-competencies and capacities within the business community must, therefore, be a priority objective of the trade support network.

• Supporting Services Exports

• The trade support network required by service exporters differs significantly from that required by product exporters. Service exporters are "selling a promise". They require consequently a different market entry strategy than exporters of tangible products. In fact, each services sub-sector requires a different entry strategy and, therefore, a different support network.

• While differing in structure and composition, each service sub-sector's network must address the same issues: standards, promotion, advocacy and international recognition of credentials.

• Operational Efficiencies

• A trade support network's success depends less on structure and more on the efficiency with which its various members collaborate. The effective use of information and communications technology is therefore critical to the sustainability of the trade support network (local, national and international). Yet most developing country networks fail to utilize this technology effectively. As a consequence, rather than a network, the trade support infrastructure tends to be a collection of institutions, public and private, working in isolation.

• Accountability

• The exporter's trade support network, and its individual parts, must be accountable. It is possible to apply and monitor performance criteria for each component and institution. While national experience suggests that these measurement instruments are largely quantitative, qualitative assessments are being successfully applied (largely through feedback from service users).