Tag Archives: Aid policy

Budgetisation of the European Development Fund

Budgetisation of the European Development Fund

Outline of the Community (European Union) legislation about Budgetisation of the European Development Fund

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Development > African Caribbean and Pacific states (ACP)

Budgetisation of the European Development Fund

Document or Iniciative

Communication from the Commission to the Council and the European Parliament of 8 October 2003: “Towards the full integration of cooperation with ACP countries in the EU budget” [COM(2003) 590 final – not published in the Official Journal].

Summary

In this communication, the Commission recommends the incorporation into the EU budget of the aid granted to the ACP and OCT countries under the European Development Fund (EDF).

A POLITICALLY DESIRABLE CHANGE

Countering the risks of marginalisation

With the extension of the external relations of the Union, the conclusion of cooperation agreements with numerous other regions and the increase in the amounts earmarked for external aid in the budget, separate financing for the ACP countries is no longer a privilege, rather the opposite.

These cooperation agreements with numerous regions around the world, like the Cotonou Agreement broach a series of subjects of common interest: political dialogue, trade arrangements, democracy objectives, etc. After the integration of the EDF into the budget, all the major geographical programmes will be part of the structure of the budget. From a technical point of view, that will permit increased synergy between the programmes centred around the national/geographical approach and those that pursue thematic objectives.

The cooperation programmes with the ACP countries have created a wealth of experience and good practice that is worthy of application to other programmes pursued in other developing regions. The incorporation of the EDF will facilitate the mutual enrichment of the different programmes.

The incorporation of the EDF into the budget will also facilitate cooperation between the regions of Africa. A similar gain in coherence could be brought about for Caribbean countries in relation to Latin America and for the Pacific group in relation to Asia.

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Towards greater independence

With the budgetisation of the EDF, the financing of EU-ACP cooperation would gain independence from voluntary contributions determined as a result of national viewpoints and would present better prospects for continuity. For Member States, that would signify that financial cooperation with the ACP was genuinely placed at the EU level.

Towards stronger legitimacy

The EDF is currently the only expenditure that is not subject to authorisation by the European Parliament. Incorporating the EDF into the budget would put an end to this anomaly, thereby strengthening the public legitimacy of the EU’s external assistance. Not being part of the budget, cooperation with the ACP countries is clearly excluded from one of the most important political decision-making processes of the Union. The already significant risk that relations with the ACP countries are marginalised in comparison with other economically more advanced regions of the world is exacerbated by their lack of visibility in the political arenas of the Union. Furthermore, the influence of the ACP-EU Joint Parliamentary Assembly will be enhanced through its members in the European Parliament.

Towards greater transparency

A single budget including all external aid expenditures offers the possibility of providing a global picture of the EU’s external assistance and of EU development policy, in terms of both size and geographical distribution. Citizens will have to refer only to a single document in future when they want to know what the EC spends on development policy.

Towards greater efficiency and effectiveness

The integration of the EDF into the budget will lead to greater cost effectiveness. The unification of administrative and legal rules, decision-making structures, and commitment and payment procedures will remove a certain amount of duplication which is currently imposed on the different operators and stakeholders. It will help simplify reporting requirements, reduce the administrative burden on beneficiary countries and respond in a more efficient manner to the challenges faced by developing countries. The management principles applicable to the budget will also make the pattern of commitments more regular and help improve the delivery of aid to the ACP.

CONCERNS LINKED TO BUDGETISATION

Will the quality of the partnership with ACP countries be maintained?

Yes. In the Commission’s view, the European Development Fund is a historical, not a substantive element in the privileged relations between the ACP and the EU. The Cotonou Agreement remains the cornerstone of this partnership and will continue to govern EU-ACP relations as in the past.

Commitments to individual ACP countries will continue to be made on the basis of programmes prepared and approved with them. In every country, the government will continue to be closely associated with multiannual indicative programming, the preparation of annual action plans, etc.

Will budgetisation challenge the financial commitment of the EU to the ACP?

This financial commitment must be renewed every five years, either through a new EDF within the framework of the general budget. The instruments currently available in the budgetary framework, and more particularly the decisions on the financial perspectives, offer the same guarantees.

Background

There are currently two main channels of EU assistance to the ACP countries: funds from the EU budget and funds from the EDF. Different administrative rules and decision-making structures apply to these two forms of aid. Funds from the EU budget are administered in accordance with the general Financial Regulation. Funds from the EDF meanwhile are administered according to the rules laid down by the Cotonou Agreement.

The proposal to incorporate the EDF into the budget would mean that the new financial perspectives could include the totality of expenditure for EU-ACP cooperation. This is not a new proposal: the Commission had previously proposed the integration of the EDF in the Community general budget in 1973 and 1979. During the negotiations on the 2007-2013 financial perspectives, the Commission revived the proposal, but it was once again rejected by the European Council (15-16 December 2005). The debate is likely to be reopened when the next financial perspectives are prepared.

Towards a European Consensus on Humanitarian Aid

Towards a European Consensus on Humanitarian Aid

Outline of the Community (European Union) legislation about Towards a European Consensus on Humanitarian Aid

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Humanitarian aid

Towards a European Consensus on Humanitarian Aid

Document or Iniciative

Communication of 13 June 2007 from the Commission to the European Parliament and the Council: Towards a European Consensus on Humanitarian Aid [COM(2007) 317 final – Not yet published in the Official Journal].

Summary

The Commission presents the principles of the future European Union (EU) consensus on humanitarian aid. This joint declaration aims to increase the effectiveness of aid by increasing the complementarity of the EU’s and its Member States’ actions.

The European Union (EU) is the world’s leading humanitarian donor, adding together the aid given at both European and national levels. However, it needs to adopt a more strategic approach, notably in the face of the new challenges raised by changes in the crisis landscape, such as:

  • the greater frequency with which humanitarian crises occur, linked to poverty, climate change and competition for access to natural resources;
  • the increasing disregard for or violation of international and humanitarian law;
  • the encroachment of humanitarian space *.

The European Consensus on humanitarian aid must be in-line with the European Consensus for Development.

Create a common vision

Humanitarian aid is based on specific principles and modalities. Therefore, the Commission suggests that the EU ensures the:

  • respect for fundamental humanitarian principles, particularly those of humanity *, neutrality *, impartiality * and independence *;
  • promotion of international law, especially international humanitarian law;
  • coherence, complementarity and effectiveness of policies connected with humanitarian aid (e.g. crisis management and food security), while highlighting their differences and their independence.

The sharing of experience could contribute towards increasing the impact of aid, including through international cooperation. In this context, the EU must confirm its commitment in favour of the initiative on the principles and good practice for humanitarian aid.

Translating principles into practice

Financial humanitarian aid must be assessed with the objective of effectiveness in mind. Thus, the Commission recommends that the EU:

  • commits to adequate provision of humanitarian aid, on the basis of agreed minimum standards of assistance and protection;
  • establishes a common framework for assessing needs and sharing expert analysis;
  • ensures an overall balanced response, particularly with regard to forgotten crises *;

In addition, the participation of all stakeholders concerned is essential for carrying out action. In particular, this concerns European and local non-governmental organisations (NGOs), the United Nations through its Office for the Coordination of Humanitarian Affairs (OCHA), and the Red Cross / Red Crescent Movement. To ensure speed and quality in the delivery of humanitarian aid, implementing partners should be selected on the basis of:

  • professionalism, experience and capacity to respond to an identified need;
  • adherence to international standards and guidelines;
  • cost-efficiency (e.g. overheads in proportion to the aid going to recipients);
  • local partnership and context;
  • accountability to aid recipients and European public opinion.

The EU’s crisis response capacities need to be increased, specifically by drawing on local resources. The EU also needs to increase its response capacities and help plug capacity gaps at global level, in particular in the fields of transport, communications and logistics.

Humanitarian action may be supported by Member States’ civil protection and military resources and assets. In this respect, the EU encourages adherence to UN guidelines on the use of civil defence and military means in natural disasters (Oslo guidelines ) and in complex crises (Military and Civil Defence Assets Directives ).

Reducing the risks caused by natural disasters is another essential component of humanitarian action. In this context, the EU encourages international efforts within the Hyogo Framework for Action, which proposes a global model for reducing the risks associated with natural disasters by 2015.

Lastly, the EU should reinforce the link between disaster relief, rehabilitation and development (LRRD) based on experiences and lessons learnt, and through cooperation between humanitarian aid actors and development aid actors (especially in situations of complex crisis and state fragility).

Key terms of the act
  • Humanitarian space: The operating environment which humanitarian actors need on the ground in order to have full access to victims, to be able to deliver assistance and to offer protection, without endangering the safety and security of aid workers.
  • Principle of humanity: Humankind shall be treated humanely in all circumstances by saving lives and alleviating suffering, while ensuring respect for the individual.
  • Principle of neutrality: Neutrality means not taking sides in hostilities or engaging at any time in controversies of a political, racial, religious or ideological nature.
  • Principle of impartiality: Provision of humanitarian assistance must be impartial and not based on nationality, race, religion or political point of view.
  • Principle of independence: Humanitarian agencies must formulate and implement their own policies independently of government policies or actions.
  • Forgotten crises: Crises that receive little or no media attention and whose victims receive relatively little or no international assistance.
  • Hyogo Framework for Action: Global blueprint for disaster-risk reduction efforts (horizon: 2015).

Related Acts

Communication from the Commission to the European Parliament and the Council – The mid-term review of the European Consensus on Humanitarian Aid Action Plan – implementing effective, principled EU humanitarian action [COM(2010) 722 final – Not published in the Official Journal].

The Commission identifies the areas which require additional effort for the further implementation of the European Consensus on humanitarian aid. In particular, the partners must strengthen their joint action in terms of planning interventions, food aid, reducing the risks of disasters and assistance with the transition period following on from a disaster.

Partnership with the United Nations: development assistance and humanitarian aid

Partnership with the United Nations: development assistance and humanitarian aid

Outline of the Community (European Union) legislation about Partnership with the United Nations: development assistance and humanitarian aid

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Humanitarian aid

Partnership with the United Nations: development assistance and humanitarian aid

Document or Iniciative

Communication from the Commission to the Council and the European Parliament of 20 May 2001 – Building an effective partnership with the United Nations in the fields of development and humanitarian affairs [COM(2001) 231 final – Not published in the Official Journal].

Summary

The European Union (EU) and the United Nations (UN) conduct joint actions at a global level. Their cooperation extends to the majority of the areas covered by the EU’s external policy and to all of the areas provided for by the Charter of the United Nations (peace, security, human rights, economic and social affairs, development, humanitarian aid and trade policy). In addition, the EU is one of the main donors to the UN’s specialised agencies, funds and programmes.

This Communication analyses the means for reinforcing their partnership in the areas of humanitarian aid and development assistance, in particular for implementing the Millennium Development Goals (MDGs).

Improving cooperation: the objectives

The partners can adapt their framework for cooperation through:

  • examining the possibilities for cooperation between the EU and the UN during the drawing up of the per-country multiannual programming instruments of European external policy;
  • recasting the Financial Regulation of the EU for greater flexibility in terms of participating in UN activities;
  • reforming the framework agreement between the EU and the UN concerning the financial management, control and audit of UN programmes and projects.

In addition, the Communication recommends increasing the representation and defence of EU interests within the UN. It is therefore necessary to increase policy dialogue with UN agencies, funds and programmes, and to improve EU participation in the system of multilateral governance.

Operational cooperation: recommendations

The EU, the UN and their partners conduct joint ground operations in the areas of humanitarian aid and development assistance. This cooperation can be improved by respecting two core principles:

  • the division of labour must be made according to the added value or comparative advantage brought by each partner;
  • development assistance activities should focus on combating poverty.

In addition, the coordination of donors must be improved, as well as the internal coordination of the UN, and the strategic planning of operations based on common objectives.

Concerning the UN’s partner organisations, the Commission recommends:

  • supporting those organisations whose mandate corresponds to European policy priorities, and strengthening policy dialogue and exchanges with these organisations;
  • prioritising multi-annual financial programmes and coordinating the funding from different donors, as well as combating financial fraud.

European Development and External Assistance Policies: 2008 Report

European Development and External Assistance Policies: 2008 Report

Outline of the Community (European Union) legislation about European Development and External Assistance Policies: 2008 Report

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Development > General development framework

European Development and External Assistance Policies: 2008 Report

Document or Iniciative

Report from the Commission to the Council and the European Parliament of 30 June 2009 – Annual Report 2009 on the European community’s development and external assistance policies and their implementation in 2008 [COM(2009) 296 final – Not published in the Official Journal].

Summary

2008 was marked by soaring food and energy prices and the global financial crisis. Despite these unfavourable conditions, the European Union (EU) demonstrated its ability to meet its commitments and to respond to the new needs of developing countries.

The EU is a key partner on the global stage, particularly with regard to issues such as climate, energy, trade and achieving the Millennium Development Goals (MDGs). This Report highlights the importance of making European development policies coherent (BG) (CS) (DA) (ET) (EL) (FR) (GA) (LV) (LT) (HU) (MT) (NL) (PL) (PT) (RO) (SK) (SL) (FI) (SV), whilst taking into account the growing interdependence between the EU and its partners.

In 2008, the Commission assessed the progress made towards achieving the MDGs at mid-way and set new milestones for 2010. The Commission also increased efforts to integrate issues such as gender equality, the environment and the rights of children and indigenous people into the development process. Furthermore, the Commission considers good tax and democratic governance to be essential for successful reforms.

More and better aid

In order to offset the impact of soaring prices, the EU created a Food Facility (FR) with a budget of EUR 1 billion for the period 2008-2010. In 2008 the Commission also increased the budget for humanitarian aid by EUR 140 million and called up EUR 200 million from the European Development Fund (EDF).

The EU renewed its commitment to increasing overall development assistance in coming years. The volume of assistance has increased by 90 % since 2001, reaching EUR 9.33 billion in 2008.

Aid efficiency must also be improved. In this context, it involves:

  • prioritising the channelling of aid through country systems to reinforce local ownership of projects and reduce transaction costs;
  • increasing the predictability of aid, through setting up MDG contracts to provide longer-term aid. The first countries to benefit from these contracts were Burkino Faso, Ghana, Mali, Mozambique, Rwanda, Uganda and Zambia;
  • adopting a strategy of long-term aid, targeted towards those partner countries achieving results and good budget management.

The Report highlights an increase in budget support to 39 % (EUR 3.68 billion from EU and EDF budgets), in the form of funds transferred to the national treasury of the beneficiary country. This is gradually replacing direct project-linked funding, provided that public finance management in the beneficiary country has received a positive assessment. The Commission is working to improve eligibility criteria and risk assessment.

In 2008, the Commission began reforms to increase its capacity for action in terms of technical cooperation and to strengthen its development project implementation units. This reform was supported by the launch of “Capacity4Dev”, an on-line interactive platform.

Partnership steps

More effective aid must be based on donor coordination and the sharing of experience. This approach prevailed in the distribution of aid in Afghanistan, in the Occupied Palestinian Territory using the funding instrument PEGASE and in Iraq using the funding instrument IRFFI.

The Commission has continued its cooperation with the United Nations, the World Bank and all of the donors in planning recovery operations after a crisis, disaster or conflict has occurred.

The Commission is preparing a new strategy in favour of local authorities participating in development cooperation actions.

Assessment of actions taken

In terms of development cooperation, the EU carries out results-oriented actions. In order to increase the effectiveness and impact of its aid, the Commission assessed geographical and thematic programming and aid delivery modalities. It concluded that greater visibility of actions, synergy between activities and coherence between country and regional aid is required.

European development and external assistance policy: 2009 Report

European development and external assistance policy: 2009 Report

Outline of the Community (European Union) legislation about European development and external assistance policy: 2009 Report

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Development > General development framework

European development and external assistance policy: 2009 Report

Document or Iniciative

Report from the Commission to the Council and the European Parliament – Annual Report 2010 on the European Union’s development and external assistance policies and their implementation in 2009 [COM(2010) 335 final – Not published in the Official Journal].

Summary

In 2009, European Union (EU) cooperation activities with third countries took place in a difficult context. Developing countries had to face the economic and financial crisis and rising food prices.

The EU reacted quickly, creating a financial facility to improve production of and access to food. It also created an instrument to combat vulnerability – FLEX – to support public expenditure in the most vulnerable countries. Furthermore, the EU has established an instrument to finance the adaptation of these countries to climate change.

International relations

Existing relationships with several global regions were strengthened in 2009, particularly in the course of:

  • strategic summits on development, held with India, China and Russia;
  • the adoption of a new strategic framework for Latin America and an Investment Facility;
  • the launch of negotiations to revise the Cotonou Agreement with ACP countries, and the mid-term review of the European Development Fund (EDF);
  • the strengthening of dialogue with South Africa on peace and security;
  • the holding of the EU-Pakistan summit;
  • the conclusion of the first partnership agreement with Iraq;
  • the implementation of the European Neighbourhood Policy (ENP) and its investment facility.

Millennium Development Goals (MDGs)

Some progress has been made since the adoption of the MDGs in 2000, but some countries are significantly behind, particularly due to the international context in 2008 and 2009. The EU intends to adopt a global approach to accelerate progress with a view to meeting the MDGs before 2015. It will present a joint position at the UN summit in September 2010 for the international assessment of the MDGs.

Coherence of policies with development goals

The Commission and EU countries should apply the principles of the European Consensus on Development and improve the coordination of their actions. The impact of European policies on development must be taken into account. The Council has identified a number of priority areas: trade and finance, climate change, food security, migration, and peace and security.

Partner countries must also improve the effectiveness of their policies, good governance and the protection of human rights.

Increased and more effective aid

The Commission and Member States should increase the quantity but also the quality of their aid. Together they supply more than half of global Official Development Assistance (ODA).

In order to increase the effectiveness of aid, the EU implements measures planned at the Accra summit in 2008:

  • division of labour and coordination of donors;
  • the use of national development systems;
  • quality of technical cooperation.

The EU must also work more closely with international organisations, local authorities and civil society. The next summit on the effectiveness of aid is to take place in Seoul in 2011.

Budget support for developing countries

The Commission promotes the deployment of aid through budget support strategies, i.e. the transfer of aid to the national treasury of its partners. Budget support guarantees that their national priorities are met. It also reduces the costs of financial transfers.

In 2009, EUR 2.4 billion were allocated to:

  • general budget support (GPS) – 35% of operations – for national development policies;
  • sector-specific budget support (SPS) – 65% of operations.

Public finance management (PFM) systems in developing countries should be efficient enough to receive this type of aid. However, the Commission proposes that certain fragile States might benefit from it under certain conditions.

Evaluation of results

The Commission has adopted stricter standards to control the quality of its actions and ensure that results are monitored. Assessments made in 2009 showed that the effectiveness and sustainability of cooperation actions are still to be improved. It is also essential to foster ownership of projects by partner countries.

European Development Fund

European Development Fund

Outline of the Community (European Union) legislation about European Development Fund

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Development > African Caribbean and Pacific states (ACP)

European Development Fund (EDF)

Even though a heading has been reserved for the Fund in the Community budget since 1993 following a request by the European Parliament, the EDF does not yet come under the Community’s general budget. It is funded by the Member States, is subject to its own financial rules and is managed by a specific committee. The aid granted to ACP States and OCTs will continue to be funded by the EDF, at least for the period 2008-2013.

Each EDF is concluded for a period of around five years. Since the conclusion of the first partnership convention in 1964, the EDF cycles have generally followed the partnership agreement/convention cycles.

  • First EDF: 1959-1964
  • Second EDF: 1964-1970 (Yaoundé I Convention)
  • Third EDF: 1970-1975 (Yaoundé II Convention)
  • Fourth EDF: 1975-1980 (Lomé I Convention)
  • Fifth EDF: 1980-1985 (Lomé II Convention)
  • Sixth EDF: 1985-1990 (Lomé III Convention)
  • Seventh EDF: 1990-1995 (Lomé IV Convention)
  • Eighth EDF: 1995-2000 (Lomé IV Convention and the revised Lomé IV)
  • Ninth EDF: 2000-2007 (Cotonou Agreement)
  • Tenth EDF: 2008-2013 (Revised Cotonou Agreement)

The EDF consists of several instruments, including grants, risk capital and loans to the private sector. The Stabex and Sysmin instruments designed to help the agricultural and mining sectors were abolished by the new partnership agreement signed in Cotonou in June 2000. This agreement also streamlined the EDF and introduced a system of rolling programming, making for greater flexibility and giving the ACP States greater responsibility.

The ninth EDF has been allocated 13.5 billion for the period 2000-2007. In addition, the unexpended balances from previous EDFs total 9.9 billion.

ACP-EC Council of Ministers Decision No 6/2005of 22 November 2005 commits 482 million of the conditional 1 billion to the ninth European Development Fund. This amount is allocated as follows: 352 million to support long-term development, 48 million for regional cooperation and integration and 82 million for the investment facility. Furthermore, a second instalment of 250 million for the ACP-EU Water Facility was established by ACP-EC Council of Ministers Decision No 7/2005 .

The development aid provided by the EDF forms part of a broader European framework. Within the European Union, the funds of the Community’s general budget may be used for certain types of aid. Moreover, in addition to managing part of the EDF’s resources (loans and risk capital), the European Investment Bank (EIB) will contribute a total of 1.7 billion from own resources for the period covered by the ninth EDF.

The tenth EDF covers the period from 2008 to 2013 and provides an overall budget of EUR 22 682 million. Of this amount, EUR 21 966 million is allocated to the ACP countries, EUR 286 million to the OCT and EUR 430 million to the Commission as support expenditure for programming and implementation of the EDF. The amount for the ACP countries is divided accordingly: EUR 17 766 million to the national and regional indicative programmes, EUR 2 700 million to intra-ACP and intra-regional cooperation and EUR 1 500 million to Investment Facilities. An increased share of the budget is devoted to regional programmes, thereby emphasising the importance of regional economic integration as the basic framework for national and local development. An innovation in the tenth EDF is the creation of “incentive amounts” for each country.

The Member States have their own bilateral agreements and implement their own initiatives with developing countries that are not financed by the EDF or any other Community funds.