This decade continues the trends towards globalization, the liberalization, integration and interdependence of markets, and international cooperation on global environmental issues. Emerging economies and markets play an increasingly important role in the global economy and development cooperation. The paradigm shift towards social sectors in international development cooperation is reconfirmed in 2000 by the adoption of the Millennium Development Goals; economic development is to be achieved by the market economy. Official development aid and lending for economic infrastructure and industrial cooperation are accordingly reduced.
The changing development cooperation paradigm has a substantial impact on UNIDO in the form of the departure of leading Member States. Against a backdrop of continued high demand for technical services, UNIDO undertakes further restructuring towards efficiency and effectiveness, stronger cooperation with the private sector and diversifies its funding sources through increasing cooperation with funding institutions. UNIDO becomes an implementing agency for both the Multilateral Fund and the GEF, which become substantial donors for activities covering industry, the environment and sustainable energy. Bilateral donors start to play an increasingly important role in the funding of technical cooperation projects.
The global community sets a new development agenda with the launch of the Aid for Trade (AFT) Initiative at the six (World Trade Organization (WTO) Ministerial Conference held in Hong Kong in December 2005. AFT recognizes the importance of trade as a development driver and of various obstacles to trade which development assistance should help overcome. Many countries establish specific AFT funding which becomes an important source for UNIDO’s support for quality infrastructure development at national and regional levels.