# EUR-Lex - 52011DC0303 - EN

*|*

# 52011DC0303

**JOINT COMMUNICATION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS A new response to a changing Neighbourhood JOINT COMMUNICATION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS A new response to a changing Neighbourhood /* COM/2011/0303 final */**

			*

			*

JOINT COMMUNICATION TO THE EUROPEAN
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE
COMMITTEE OF THE REGIONS

A new response to a changing Neighbourhood

To the East and South of the European Union
(EU) lie sixteen countries[1]
whose hopes and futures make a direct and significant difference to us. Recent
events have brought this into sharper relief, highlighting the challenges we
face together. The overthrow of long-standing repressive regimes in Egypt and
Tunisia; the ongoing military conflict in Libya, the recent violent crackdown
in Syria, continued repression in Belarus and the lingering protracted
conflicts in the region, including in the Middle East, require us to look
afresh at the EU’s relationship with our neighbours. The encouraging progress
made by other neighbours, for example by Republic of Moldova in its reform
efforts, Ukraine in the negotiations of the Association Agreement or Morocco
and Jordan in their announcement of constitutional reform, need also to be
supported. The Lisbon Treaty has allowed the EU to strengthen the delivery of
its foreign policy: co-operation with neighbouring countries can now be
broadened to cover the full range of issues in an integrated and more effective
manner. This was a key driver for initiating a review, in consultation with
partner countries and other stakeholders, of the European Neighbourhood Policy
(ENP) in summer 2010. Recent events throughout the Southern Mediterranean have
made the case for this review even more compelling. The EU needs to rise to the
historical challenges in our neighbourhood.

Since its inception in 2004, the ENP has
promoted a variety of important initiatives, particularly on the trade and
economic front, which have allowed the EU and its neighbours to develop
stronger relationships in virtually all policy fields, from energy to
education, from transport to research. These are now the subject of exchanges
and co-operation between the EU and its neighbours. EU assistance has increased
and is better targeted. But there is room for improvement on all sides of the
relationship. Recent events and the results of the review have shown that EU
support to political reforms in neighbouring countries has met with limited
results. There is for example a need for greater flexibility and more tailored
responses in dealing with rapidly evolving partners and reform needs – whether
they are experiencing fast regime change or a prolonged process of reform and
democratic consolidation. Co-ordination between the EU, its Member States and
main international partners is essential and can be improved.

A new approach is needed to strengthen the
partnership between the EU and the countries and societies of the
neighbourhood: to build and consolidate healthy democracies, pursue sustainable
economic growth and manage cross-border links.

The ENP should be a policy of the Union
with the Member States aligning their own bilateral efforts in support of its
overall political objectives. Equally, the European Parliament has a central
role to play in helping to deliver some of its central objectives. And beyond
that, the ENP should serve as a catalyst for the wider international community
to support democratic change and economic and social development in the region.

This partnership with our neighbours is
mutually beneficial. The EU is the main trading partner for most of its
neighbours. Sustainable economic development and job creation in partner
countries benefits the EU as well. Likewise, managed movement of people is
positive for the entire neighbourhood, facilitating the mobility of students,
workers and tourists, while discouraging irregular migration and human
trafficking. Active engagement between the EU and its neighbours in areas such
as education, strengthening and modernising social protection systems and
advancing women's rights will do much to support our shared objectives of
inclusive growth and job creation.

The new approach must be based on mutual
accountability and a shared commitment to the universal values of human rights,
democracy and the rule of law. It will involve a much higher level of
differentiation allowing each partner country to develop its links with the EU
as far as its own aspirations, needs and capacities allow. For those southern
and eastern neighbours able and willing to take part, this vision includes
closer economic integration and stronger political co-operation on governance
reforms, security, conflict-resolution matters, including joint initiatives in
international fora on issues of common interest. In the context of the southern
Mediterranean, the Commission and the High Representative have already laid out
their proposal for a Partnership for Democracy and Shared Prosperity[2] with such partners.

The new approach, as described above, aims
to:

(1)
provide greater support to partners engaged in
building deep democracy – the kind that lasts because the right to vote is
accompanied by rights to exercise free speech, form competing political
parties, receive impartial justice from independent judges, security from accountable
police and army forces, access to a competent and non-corrupt civil service —
and other civil and human rights that many Europeans take for granted, such as
the freedom of thought, conscience and religion;

(2)
support inclusive economic development – so that
EU neighbours can trade, invest and grow in a sustainable way, reducing social
and regional inequalities, creating jobs for their workers and higher standards
of living for their people;

(3)
strengthen the two regional dimensions of the
European Neighbourhood Policy, covering respectively the Eastern Partnership
and the Southern Mediterranean, so that we can work out consistent regional
initiatives in areas such as trade, energy, transport or migration and mobility
complementing and strengthening our bilateral co-operation;

(4)
provide the mechanisms and instruments fit to
deliver these objectives.

The partnership will develop with each
neighbour on the basis of its needs, capacities and reform objectives. Some
partners may want to move further in their integration effort, which will
entail a greater degree of alignment with EU policies and rules leading progressively
to economic integration in the EU Internal Market. The
EU does not seek to impose a model or a ready-made recipe for political reform,
but it will insist that each partner country’s reform process reflect a clear
commitment to universal values that form the basis of our renewed approach. The
initiative lies with the partner and EU support will be tailored accordingly.

Increased EU support to its neighbours is
conditional. It will depend on progress in building and consolidating democracy
and respect for the rule of law. The more and the faster a country progresses
in its internal reforms, the more support it will get from the EU. This
enhanced support will come in various forms, including increased funding for
social and economic development, larger programmes for comprehensive
institution-building (CIB), greater market access, increased EIB financing in
support of investments; and greater facilitation of mobility. These
preferential commitments will be tailored to the needs of each country and to
the regional context. They will recognise that meaningful reform comes with
significant upfront costs. It will take the reform track record of partners during
the 2010-12 period (based on the annual progress reports) into account when
deciding on country financial allocations for 2014 and beyond. For countries
where reform has not taken place, the EU will reconsider or even reduce
funding.

The EU will uphold its policy of curtailing
relations with governments engaged in violations of human rights and democracy
standards, including by making use of targeted sanctions and other policy
measures. Where it takes such measures, it will not only uphold but strengthen
further its support to civil society. In applying this more differentiated
approach, the EU will keep channels of dialogue open with governments, civil
society and other stakeholders. At the same time and in line with the principle
of mutual accountability, the EU will ensure that its resources are used in
support of the central objectives of the ENP.

The resources that the EU and its
international partners are mobilising in support of the democratic transitions
in the neighbourhood must cover both the immediate and urgent needs as well as
the medium- and longer-term requirements.

1.           To support progress
towards deep democracy

We shall: · adapt levels of EU support to partners according to progress on political reforms and building deep democracy

1.1.        Supporting “deep
democracy”

A functioning democracy, respect for human
rights and the rule of law are fundamental pillars of the EU partnership with
its neighbours. There is no set model or a ready-made recipe for political
reform. While reforms take place differently from one country to another,
several elements are common to building deep and sustainable
democracy and require a strong and lasting commitment on the part of
governments. They include:

– free and fair elections;

– freedom of association, expression and assembly and a free press and
media;

– the rule of law administered by an independent judiciary and right
to a fair trial;

– fighting against corruption;

– security and law enforcement sector reform (including the police)
and the establishment of democratic control over armed and security forces.

Reform based on these elements will not
only strengthen democracy but help to create the conditions for sustainable and
inclusive economic growth, stimulating trade and investment. They are the main
benchmarks against which the EU will assess progress and adapt levels of
support.

1.2.        A partnership with
societies

We shall: · establish partnerships in each neighbouring country and make EU support more accessible to civil society organisations through a dedicated Civil Society Facility · support the establishment of a European Endowment for Democracy to help political parties, non-registered NGOs and trade unions and other social partners · promote media freedom by supporting civil society organisations' (CSOs') unhindered access to the internet and the use of electronic communications technologies · reinforce human rights dialogues

A thriving civil society empowers citizens
to express their concerns, contribute to policy-making and hold governments to
account. It can also help ensure that economic growth becomes more inclusive.
Key to making any of this happen is the guarantee of the freedoms of
expression, association and assembly. Another challenge is to facilitate the
emergence of democratic political parties that represent the broad spectrum of
the views and approaches present in society so that they can compete for power
and popular support. This challenge of fostering civil society and pluralism is
felt throughout the neighbourhood but is particularly acute for countries engaged
in fast political change or where repressive political regimes continue to
stifle pluralism and diversity.

In order to address this situation and
support political actors striving for democratic change in their countries
(especially political parties and non-registered NGOs or trade unions and other
social partners), the High Representative and the Commission support the
establishment of a European Endowment for Democracy[3]. This
Endowment will seek to bring greater influence and consistency to the efforts
of the EU, its Member States and several of the large European political
foundations that are already active in this field.

Civil society plays a pivotal role in
advancing women’s rights, greater social justice and respect for minorities as
well as environmental protection and resource efficiency. The EU will support
this greater political role for non-state actors through a partnership with
societies, helping CSOs to develop their advocacy capacity, their
ability to monitor reform and their role in implementing and evaluating EU
programmes. In-country EU Delegations will seek to bring partner countries’
governments and civil society together in a structured dialogue on key areas of
our co-operation. EU funding for such actions could be delivered through the
establishment of a dedicated Civil Society Facility for the
neighbourhood.

Media freedom and free access to
information are key elements of functioning
democracies. Social networks and new technologies play a significant role in
promoting democratic change. EU support is already available through the
European Instrument for Democracy and Human Rights (EIDHR). Additional tools
may be developed to allow the EU, in appropriate cases, to assist civil society
organisations or individual citizens to have unhindered access to the internet
and other forms of electronic communications
technologies, as well as independent media in print, radio and television.

Commitment to human rights and fundamental
freedoms through multilateral treaties and bilateral agreements is
essential. But these commitments are not always matched by action. Ratification
of all the relevant international and regional instruments and full compliance
with their provisions, should underpin our partnership. This includes a strong
commitment to promoting gender equality, in line with the major role once again
played by women in recent events in the South, fighting against all forms of
discrimination, respecting freedom of religion and protecting the rights of
refugees and beneficiaries of international protection. Reinforced human
rights dialogues will allow monitoring of commitments in this area,
including addressing cases of human rights violations. Boosting
cooperation with the Council of Europe could also help in promoting compliance.

Parliaments
can build links between our societies. The EuroNest Parliamentary Assembly (the
joint Assembly of the European Parliament and counterparts from Eastern
Partnership countries), the Euro-Mediterranean Parliamentary Assembly and Joint
Parliamentary Committees between the European Parliament and partner countries’
Parliaments constitute an essential forum for dialogue and increased mutual
understanding between decision-makers. Parliamentarians can also bring a
meaningful contribution to enhancing reform efforts and monitoring commitments
in each country’s ENP Action Plan, including on major political and human
rights issues.

1.3.        Intensifying our political
and security co-operation

We shall: · enhance EU involvement in solving protracted conflicts · make joined-up use of the Common Foreign and Security Policy and other EU instruments · promote joint action with European Neighbourhood Policy partners in international fora on key security issues

The Lisbon Treaty provides the EU with a
unique opportunity to become a more effective actor. Nowhere is this more
relevant than in our neighbourhood. But rising to the challenge requires that
EU and Member States policies be much more closely aligned than in the past, in
order to deliver the common message and the coherence that will make our
actions effective. EU instruments and policies will be effective only if
properly backed by Member States policies. Business as usual is no longer an
option if we want to make our neighbourhood a safer place and protect our
interests.

The persistence of protracted conflicts
affecting a number of partner countries is a serious security challenge to the
whole region. EU geopolitical, economic and security interests are directly
affected by continuing instability. The Israeli-Palestinian conflict and other
conflicts in the Middle East, the South Caucasus, the Republic of Moldova and
Western Sahara continue to affect sizeable populations, feed radicalisation,
drain considerable local and international resources, and act as powerful
impediments to reform.

The EU is already active in seeking to
resolve several of these conflicts. The EU is part of the Quartet on the Middle
East. It co-chairs the Geneva talks directed at peace and security in Georgia.
It participates as an observer in the “5+2” talks on the Transnistrian conflict
in the Republic of Moldova. It would be ready to step up its involvement in
formats where it is not yet represented, e.g. the OSCE Minsk Group on the
Nagorno-Karabakh conflict. The EU intends to enhance its support for confidence-building
and outreach to breakaway territories, for international efforts and structures
related to the conflicts, and, once that stage is reached, for the
implementation of settlements. It will also continue to oppose border changes
brought about through use of military force. Many of the instruments we use
everywhere in the neighbourhood to promote economic integration and sectoral
co-operation could also be mobilised to support confidence-building and
conflict-resolution objectives. The EU is also ready to develop, together with
the relevant international organisations and key partners, post-conflict
reconstruction scenarios which could act as a further incentive in the
resolution of conflicts by showing the tangible benefits of peaceful settlements.

Where the EU is already
engaged operationally on the ground, e.g. with the EU Monitoring Mission in
Georgia, the EU Border Assistance Mission in Republic of Moldova/Ukraine, or
the EU Police Mission and the EU Border Assistance Mission Rafah in the occupied
Palestinian territories, further steps will be taken to exploit the synergies
between this operational presence and the efforts to promote reforms. In
particular, wherever it is appropriate, the EU will offer to back partner
countries’ efforts to reform their justice and security sector reforms with
rule of law missions or other Common Foreign and Security Policy (CFSP)
instruments that they will consider useful.

Looking beyond conflict resolution, the EU
will make full use of the Lisbon Treaty's provisions in addressing other
security concerns and specific common interests, e.g. energy and resource
security, climate change, non-proliferation, combating international terrorism
and trans-border organised crime, and the fight against drugs. It will engage
with ENP partner countries to undertake joint actions in international fora
(e.g. UN, international conferences) on CFSP issues, as well as other global
issues.

2.           To support sustainable
economic and social development

We shall: · support partner countries' adoption of policies conducive to stronger, sustainable and more inclusive growth, to the development of micro, small and medium-sized companies and to job creation · strengthen industrial cooperation and support improvements to the business environment · help to organise events to promote investment · promote direct investment from EU SMEs and micro-credit · build on the pilot regional development programmes to tackle economic disparities between regions · launch pilot programmes to support agricultural and rural development · enhance the macro-economic policy dialogue with partners making the most advanced economic reforms · improve the effectiveness of Macro-Financial Assistance by streamlining its decision-making process · enhance dialogue on employment and social policies

2.1.        Sustainable economic
growth and job creation

Economic and social challenges in our
neighbourhood are immense. Poverty is rife, life expectancy is often low, youth
unemployment is high and the participation of women in political and economic life
is low in several countries of the region. Natural capital is being eroded and
the rising food and energy prices have severe effects across the neighbourhood.
Most partner countries have weak and poorly diversified economies that remain
vulnerable to external economic shocks. The immediate objectives are therefore
creating jobs, boosting growth, improving social protection and revitalising
sectors affected by recent crises (such as tourism). Tackling these challenges
is crucial to ensure the sustainability of political reforms and can also contribute
to reaching the Millennium Development Goals. Feeble growth, rising
unemployment and an increased gap between rich and poor are likely to fuel
instability.

The ENP will continue encouraging partner
countries' adoption of policies conducive to stronger and more inclusive
growth. This includes support for efforts to improve the business environment such as simplifying procedures and catering to small and
medium-sized businesses and to promote employability. Partner countries'
efforts to strengthen respect for the rule of law and to fight corruption will
also have a positive impact on the business environment, facilitating increased
foreign direct investment and technology transfer which in turn stimulate innovation
and job creation. The EU will pay particular attention to the challenge faced
by countries emerging from political change – helping to organise initiatives
such as investors’ conferences to clarify national investment priorities
and seek to build investors’ confidence. A powerful
signal for investors and traders would also be an enhanced investment
protection scheme. The Commission will explore options to provide legal
security to investors in neighbouring countries.

To provide additional support for SMEs the
Commission will also discuss with the EIB and other stakeholders the possible role
for the European Investment Fund[4]
in partner countries and will examine measures, including guarantees to
promote direct investment from EU SMEs and micro-credits.

The Commission can also contribute to
addressing high unemployment and poverty through pilot programmes supporting
agricultural and rural development, as well as pilot regional development
programmes, drawing on the EU's extensive experience in these fields.[5]

The regional development programmes can contribute to addressing economic imbalances and disparities
between regions that undermine the capacity of a country's economy as a whole.
The current pilot programmes will help members of the Eastern Partnership
identify appropriate structures and activities to address these challenges,
within their territories and if appropriate cross-border with their neighbours
in the region. A similar approach will be explored for the southern
neighbourhood.

Policy dialogue will continue on
macro-economic governance and budgetary sustainability. This macro-economic
dialogue will be enhanced with those partners that go furthest in their
economic integration with the EU and be based on a review of macro-economic
policies and key structural reforms. This will be accompanied by an enhanced
dialogue on employment and social policies.

The Macro-Financial Assistance (MFA)
instrument may be mobilised to assist partner countries to address short-term
balance-of-payments difficulties. In the short term this is most relevant to
those dealing with the immediate economic and social impact of the recent
political changes. The Commission will propose a Framework Regulation in order
to make the decision-making process of MFA allocation more efficient, provide a
more transparent legal basis for this instrument and refine some of its
criteria.

2.2.        Strengthening trade ties

We shall: · negotiate Deep and Comprehensive Free Trade Areas with willing and able partners · further develop trade concessions, especially in those sectors most likely to offer an immediate boost to partners’ economies

Most of our
neighbours rely on the EU as their main export market and import source. Trade
in goods and services is a powerful instrument to stimulate economic growth,
enhance competitiveness and support economic recovery. It is therefore
essential that we establish with each of them mutually beneficial and ambitious
trade arrangements matching their needs and their economic capacities.

The main and most effective vehicle for
developing closer trade ties is the Deep and Comprehensive Free Trade Area (DCFTA).
DCFTAs provide for the gradual dismantling of trade barriers and aim for
regulatory convergence in areas that have an impact on trade, in particular
sanitary and phytosanitary rules (SPS), animal welfare, customs and border
procedures, competition and public procurement. They
are designed to be dynamic in order to keep pace with regulatory developments
in the EU's Internal Market. For the most advanced partners, a DCFTA can lead
to a progressive economic integration with the EU Internal Market. Through progressive approximation of EU rules and practices, DCFTAs
require a high degree of commitment to complex and broad-ranging reforms. This
requires strong institutional capacity. The reforms can be politically
challenging and require the involvement of the business community as well as
other interested parties. To embark on negotiations, partner countries must be
WTO members and address key recommendations enabling them to comply with the resulting commitments. They must also have made sufficient progress towards
common values and principles.

Trade mostly relies on a bilateral approach
between the EU and each partner. This allows the most advanced countries to
move faster and is consistent with the differentiation principle. The principle
is also consistent with the long-term vision of an economic community emerging
between the EU and its ENP partners.[6]
Regional economic integration is important to boost trade between partners and
develop wider economic networks. In the longer term, such a community would be
based on a common regulatory framework and improved market access for goods and
services among ENP partners and the EU. Such an approach would consider
allowing partners that have a fully functioning independent judiciary, an
efficient public administration and have made significant progress towards
eradicating corruption, into the non-regulated area of the Internal Market
for goods. This could only happen once participating countries have reached
a sufficient level of administrative and legal reliability.

In the shorter term, for those partners not
ready or willing to embark on DCFTA negotiations, other measures can be taken
to boost and facilitate trade. Taking into account the circumstances and level
of ambition of each partner country, the EU will seek to extend trade concessions in existing agreements
or ongoing negotiations, notably in those sectors best positioned to provide an
immediate boost to partners’ economies including asymmetry in the pace of
liberalisation to take into account the circumstances of each partner country. Greater market access for goods can be
achieved through Agreements on Conformity Assessment and Acceptance of
industrial products (ACAAs), which will allow free movement of industrial
products in specific sectors through mutual acceptance of conformity
certificates. The ACAAs aim to cover all sectors where the legislation is
harmonised at EU level. A partner having reached that stage would in fact
become part of a free trade area for industrial products between the EU, the
EEA and Turkey. Close cooperation with European bodies
and organisations in the areas of standardisation, conformity assessment, and
metrology can facilitate ACAAs' implementation. In order to speed the
preparation of ACAAs, the Commission is ready to enhance the technical support
given to our partners. ACAAs are likely to be signed with Tunisia and Egypt
already in 2011.

Further progress could also be made to
encourage trade flows between partner countries as well as with the EU. The
rapid implementation of the new Convention on pan-Euro-Mediterranean
preferential rules of origin will be one important element for the partners in
the South. The Commission will examine how the Convention can be extended to
other ENP partners and will make appropriate proposals.

The EU will continue to support reforms to
help partners build their capacities, through providing
public sector expertise, including through Comprehensive
Institution-Building programmes or other mechanisms such as twinning and TAIEX[7]. This will help partners meet standards for
food safety, animal and plant health and animal welfare and hence enhance their
export potential. Likewise, in order to assist the agricultural sectors to
modernise, the EU will offer rural development programmes so as to assist inter
alia in improving agricultural and food product quality.

2.3.        Enhancing sector
cooperation

We shall: · enhance sector co-operation, with a particular focus on knowledge and innovation, climate change and the environment, energy, transport and technology · facilitate partner countries' participation in the work of selected EU agencies and programmes

Enhanced cooperation can take place in all
sectors relevant to the Internal Market, ranging from social policy and public
health to consumer protection, statistics, company law, research and
technological development, maritime policy, tourism, space and many others.
Co-operation and exchange will be stepped up significantly, in line with the
more-for-more approach, in the following areas:

·
The EU will propose to neighbouring partners to
work towards the development of a Common Knowledge and Innovation Space.
This would pull together several existing strands of cooperation: policy
dialogue, national and regional capacity-building, co-operation in research and
innovation, and increased mobility opportunities for students, researchers and
academics. In parallel co-operation in the area of higher education will
be expanded through increased support for student and academic staff
mobility within university partnerships (under Erasmus Mundus) and
structured cooperation for university modernisation
(through Tempus).

·
The EU will join up efforts with its
neighbours on climate change by enhanced co-operation to address
low-carbon development and improve resilience to climate impacts (adaptation),
with a view to implementing the Cancun agreement and moving towards a
comprehensive global climate regime. The EU
and partner countries should also pursue a higher level of environment
protection[8] aimed
at enforcing higher standards of air and water quality, improved environmental
governance, higher resource efficiency, protection of biodiversity and
ecosystems and supporting the necessary infrastructure investments.

·
Energy
co-operation will be stepped up through increased energy policy dialogue aiming
at further market integration, improved energy security based on converging
regulatory frameworks, including on safety and environmental standards, the
development of new partnerships on renewable energy sources and energy
efficiency, and nuclear safety. In the medium term this could lead to extending the Energy Community Treaty to neighbours not yet party to
it or, building on its experience, establishing a complementary “EU-Southern
Mediterranean Energy Community”.

·
The Commission will propose a new framework for transport
co-operation, aiming at closer market integration in the transport sector,
notably extending trans-European transport networks (TEN-Ts) to partner
countries, addressing administrative bottlenecks with a focus on safety and
security issues (including issues such as air and rail traffic management and
maritime transport), and enhancing co-operation with various EU transport
agencies.

·
The Commission also supports
a more strategic approach and cooperation on maritime affairs, aiming at
enhancing cooperation across maritime sectors and allowing for sustainable
economic development.

·
Recent developments in the South Mediterranean
countries have shown the importance of information and communication
technologies as tools for political and social change. Cooperation with
partner countries will therefore be stepped up to support the development of a
digital economy, using ICT to tackle national and global challenges.

Finally, the EU will further facilitate
partner countries’ participation in the work of EU agencies and the EU
programmes which are open to them[9].
This has been on offer for some years and has led to some co-operation in areas
such as drugs monitoring or aviation safety. The Commission will put together a
list of programmes in which partners may participate as a matter of priority,
with a focus on those offering opportunities for youth and people-to-people
contacts. It will also support partner countries in fulfilling the legislative
pre-requisites for participating in EU agencies and provide support for
covering some of the associated costs of participation.

2.4.        Migration and mobility

We shall: · pursue the process of visa facilitation for selected ENP partners and visa liberalisation for those most advanced · develop existing Mobility Partnerships and establish new ones · support the full use by Member States of opportunities offered by the EU Visa Code

Mobility and people-to-people contacts are
fundamental to promoting mutual understanding and economic development. They
are indispensable for trade, especially in services, as well as for exchanging
ideas, spreading innovation, tackling employment and social issues,
establishing strong relationships between companies, universities and civil
society organisations.

Labour mobility is an area where the EU and
its neighbours can complement each other. The EU’s workforce is ageing and
labour shortages will develop in specific areas. Our neighbourhood has
well-educated, young and talented workers who can fill these gaps. In
attracting this talent, the EU is conscious of the risks of brain drain, which
could require additional mitigating support measures.

Partner countries are also important
countries of origin and transit for irregular migrants. Cooperation on fighting
irregular migration is essential to reduce the human suffering and diminished
security that is generated. Such cooperation will be one of the conditions on
which Mobility partnerships will be based.

The ENP aims to develop
a mutually beneficial approach where economic development in partner countries
and in the EU, well-managed legal migration, capacity-building on border
management, asylum and effective law-enforcement co-operation go hand in hand.
This approach is in line with the three pillars of the EU Global Approach and
the recently adopted Communication on migration[10]: better organising legal migration, maximising the positive impact
of migration on development, enhancing capacity-building in border and
migration management. The promotion and respect of migrants' rights are also an
integral part of the approach.

Mobility Partnerships provide the comprehensive frameworks to ensure that the movement of
persons between the EU and a third country is well-managed. These partnerships
bring together all the measures which ensure that mobility is mutually
beneficial. They provide for better access to legal migration channels and to
strengthen capacities for border management and handle irregular migration.
They can include initiatives to assist partner countries to establish or
improve labour migration management, including
recruitment, vocational and language training, development and recognition of
skills, and return and reintegration of migrants.[11] With a view to enhancing the
mobility of citizens between partner countries and the EU, in particular for
students, researchers and businesspeople, the Commission calls on Member States
to make full use of the opportunities offered by the EU Visa Code. It
will examine ways to support them in this process and to monitor
implementation. In this context the possibilities to waive the visa fee and to
issue multi-entry visa to the categories of visa applicants referred to should
be underlined.

So far amongst our neighbours, Mobility
Partnerships have been established with the Republic of Moldova and Georgia.
The Commission believes that various countries in our neighbourhood would be
good candidates for such partnerships. The Commission will seek to conclude
negotiations with Armenia and prepare for the launch of negotiations with e.g. Morocco,
Tunisia and Egypt[12].

The EU will continue to assist Ukraine and
Republic of Moldova in their efforts to implement visa liberalisation action
plans. Along with the visa facilitation and readmission
agreements in force or under elaboration with Eastern Partnership countries,
the EU should also seek to conclude visa facilitation agreements, simultaneously
with readmission agreements, with partner countries in the South. All such agreements will require co-operation with the EU on
migration, mobility and security. Specific measures will need to be taken to
prevent irregular migration, manage their borders
effectively, ensure document security and fight organised crime, including
trafficking in human beings and smuggling of migrants.
In the long-term, gradual steps towards visa liberalisation should be
considered on a case-by-case basis, where conditions for well-managed and
secure mobility are in place.

Concerning asylum, the EU will
contribute to strengthening international protection in the region by
continuing the implementation of the Regional Protection Programme for Belarus,
Republic of Moldova and Ukraine. Circumstances allowing, it will also start
implementing the Regional Protection Programme for Egypt, Libya and Tunisia.
Other initiatives by individual ENP partners in this area will also be
supported. Resettlement of refugees in the EU must be an integral part of the
EU's efforts to support neighbouring countries confronted with significant
refugee flows.

3.           To build effective
regional partnerships within the European Neighbourhood Policy

While fully
recognising their diversity, the EU offers partnership to each individual
neighbour through a single policy, based on mutual accountability. The eastern
and southern dimensions of the ENP seek to complement that single policy by
fostering regional cooperation and developing regional synergies and responses
to the specific geographic, economic and social challenges of each region. They
build on the different historical legacies of past EU policies towards the
regions. In the South, fifteen years of Euro-Mediterranean cooperation across
all areas of the relationship have been complemented recently by the Union for
the Mediterranean. The Eastern Partnership has significantly boosted relations
between the EU and its eastern neighbours over the past two years.

3.1.        Strengthening the Eastern
Partnership

We shall: · move to conclude and implement Association Agreements including DCFTAs · pursue democratisation · pursue the visa facilitation and liberalisation process · enhance sectoral cooperation, notably in the area of rural development · promote benefits of the Eastern Partnership to citizens · increase work with civil society and social partners.

The establishment of the Eastern
Partnership (EaP) has strengthened mutual relations with partner countries in Eastern Europe and the Southern Caucasus.
It has helped to initiate and consolidate a difficult
process of change. The region has seen general progress towards democracy over
the past decade, including situations of regime change. The region continues to
face major economic challenges – it is poor, with significant differences
between individual countries, and susceptible to external factors and
influences.

The degree to which the partners have
addressed key elements of the Eastern Partnership varies (for example respect
for universal values of democracy, human rights and the rule of law; continuous
efforts to reform; and a strengthened focus on the resolution of protracted
conflicts). While some are clearly committed to reaching its full potential,
others have only made piecemeal progress. The EU will ensure that partners most
advanced and committed to the democratic reforms that underpin the Eastern
Partnership benefit the most from it. At the same time, Eastern Partnership
instruments need to be better tailored to the situations of individual
countries, based on experience following this first phase of implementation – notably by identifying tools to bridge the long period required to
negotiate far-reaching and complex Association Agreements.

Association Agreements (AAs), most of which include DCFTAs, offer each Eastern
Partnership country the opportunity to choose the level of ambition it wishes
to pursue in driving forward integration and reform. With sustained commitment
and support by the EU, partner countries can use the Agreement for regulatory
and institutional convergence. They include alignment with EU laws, norms and
standards leading progressively to economic integration in the internal market.

Association
Agreement negotiations have started with five partner countries and provide a
sound political basis for advancing relations. DCFTA negotiations within the
framework of the AA have started with Ukraine and will start with other
partners as relevant conditions are met. In spite of their relatively small
size, and therefore the limited trade exchanges between Eastern Partnership
countries and the EU, DCFTAs are of high priority for the EU as efficient tools
to reinforce the political and economic links between the EU and its Eastern
neighbours. In order to help partner countries develop the administrative
capacity required for in-depth reforms, the Eastern Partnership also provides
for Comprehensive Institution-Building (CIB) programmes. To complement this,
Pilot Regional Development Programmes are the newest EU instrument to assist
partners in addressing economic, social and regional imbalances. They will help
partners to establish appropriate structures and activities to address regional
challenges.

Some EaP countries attach great importance
to their European identity and the development of closer relations with the EU
enjoys strong public support. The values on
which the European Union is built – namely freedom, democracy, respect for
human rights and fundamental freedoms, and the rule of law – are also at the
heart of the process of political association and economic integration which
the Eastern Partnership offers. These are the same values that are enshrined in
article 2 of the European Union Treaty and on which articles 8 and 49 are
based.

People-to-people contacts are an important
part of the partnership. The EU will continue to assist Ukraine and the
Republic of Moldova in their efforts to implement visa liberalisation
action plans. These Plans could become models for other Eastern Partnership
countries. In the meantime, Eastern Partnership countries should fully exploit
opportunities offered by visa facilitation.

Eastern partners have benefited from five flagship
initiatives[13]
in the areas of border management, SME development, energy cooperation, civil
protection and environmental governance. These programmes will now be adapted
to better support bilateral partnership objectives. For example, work under the
Integrated Border Management flagship initiative is increasingly geared towards
supporting partners in fulfilling the conditions for visa facilitation and
liberalisation. Boosting the visibility of the Eastern Partnership's bilateral
and multilateral activities is important to explain their benefits to the
general public. To help increase regional solidarity,
the EU should develop its support for sub-regional cooperation that
concentrates on specific subjects involving fewer partners. The multilateral
framework has to be used more strategically to advance bilateral relations
between our partners, including in the area of conflict resolution.

In line with the aim of the renewed ENP to
focus on links between societies, the EU will promote more intensive engagement
with stakeholders, including parliaments in the framework of EURONEST,
established by the European Parliament; regional actors in cooperation with the
Committee of the Regions; business leaders, in the frame of an Eastern
Partnership Business Forum; and civil society and social partners building on
the Eastern Partnership Civil Society Forum and its national platforms.

Co-operation under the Eastern Partnership
will continue with policy dialogue in areas such as:

·
education, youth and culture: expanding
participation in programmes such as Erasmus Mundus, Tempus, Youth in Action and
eTwinning; opening of future new EU programmes such as Lifelong Learning to
Eastern Partnership countries; follow-up of the Special Action Culture
Programme 2009-10 and of the Eastern Partnership Culture Programme;

·
transport: connecting infrastructure networks of
the EU and its Eastern partners;

·
energy, environment, climate change: intensified
dialogue, following the establishment of the Eastern Europe Energy Efficiency
and Environment Partnership (E5P), and accession to the European Energy
Community Treaty by Ukraine and Republic of Moldova in order to strengthen
co-operation on energy security;

·
knowledge sharing, research and information society:
full integration of the research and education communities in the region within
the e-infrastructure (e.g. the GÉANT pan-European data network for networking,
and the European Grid Infrastructure for grids and distributed computing).

·
customs and law enforcement issues on the basis
of Strategic Frameworks for Customs Cooperation with Ukraine, Republic of
Moldova and Belarus as well as co-operation in the area of fight against
smuggling;

·
rural development measures (in line with the
European Neighbourhood Programme for Agriculture and Rural Development);

·
employment and social policies;

·
justice, freedom and security on the basis of
the Justice and Home Affairs Eastern Partnership Action Plan to be presented
later this year under the Stockholm Programme[14],
including mobility partnerships;

·
Common Security and Defence Policy (CSDP).

EU Member States, third countries and
International Financial Institutions (IFIs) have shown interest in furthering
the goals of the Eastern Partnership and supporting projects of strategic
importance. Additional resources are being mobilised from the Neighbourhood
Investment Facility (NIF), bilateral partners and IFIs, in particular the EIB,
the EBRD and the World Bank. Such co-operation should be pursued dynamically,
building on the establishment of the SME Facility, the EIB's Eastern Partners
Facility and its Eastern Partnership Technical Assistance Trust Fund to which
the EU and Member States are invited to contribute.

The Eastern Partnership Information and
Co-ordination Group gathers IFIs and third countries interested in donor
coordination and more generally in the development of Eastern Partnership,
including Canada, Japan, Norway, Russia, Switzerland, Turkey and the USA. This
informal co-operation will be intensified in line with the interests of Eastern
Partnership partners.

The second Eastern Partnership Summit
will take place in September 2011 in Warsaw. The European Commission and the
High Representative will subsequently put forward a roadmap to guide the future
implementation of the Eastern Partnership, drawing on the results of the
Summit.

3.2.        Building the Partnership
for Democracy and Shared Prosperity in the Southern Mediterranean

We shall: · undertake Comprehensive Institution-Building programmes similar to those implemented with the eastern partners · launch a dialogue on migration, mobility and security with Tunisia, Morocco and Egypt (as a first step towards a Mobility Partnership) · strengthen Euro-Mediterranean industrial cooperation · launch pilot programmes to support agricultural and rural development · focus the Union for the Mediterranean on concrete projects with clear benefits to populations of the Mediterranean region · advance sub-regional cooperation · enhance dialogue on employment and social policies

The ENP must provide an ambitious response
to the momentous changes currently ongoing in the Southern Mediterranean
region. The joint Communication on a Partnership for Democracy and Shared
Prosperity in the Southern Mediterranean[15],
issued on 8 March outlined first elements of the EU’s offer of a new
partnership with partners engaged in building democracies and extensive
reforms. The three main directions along which the EU intends to further
develop its relations with its Mediterranean partners are carried over into
this communication: democratic transformation and institution-building; a
stronger partnership with the people; and sustainable and inclusive economic
development. Through its different policies and instruments, the partnership
will be comprehensive and wide, but will be more clearly differentiated
according to the specific needs as well as the level of ambition of each
partner. The EU is already engaged in a process of strengthening relations with
a number of partners, notably through granting "advanced status"[16].

Those partners that want to establish a
Partnership for Democracy and Shared Prosperity with the EU are expected to
make progress on the key elements highlighted in section 1.1. The long-term
vision for our most advanced Mediterranean partners is close political
association with the EU and economic integration into the Internal Market. In
the short term, the following options will be available to partners making
progress on reforms.

To support
democratic transformation, Comprehensive Institution-Building programmes
similar to those implemented with its Eastern neighbours will be set up: they
will provide substantial expertise and financial support to build the capacity
of key administrative bodies (customs, enforcement agencies, justice) and will
be targeted in priority towards those institutions most needed to sustain
democratisation.

To build a stronger
partnership with people, the Commission will launch a dialogue on
migration, mobility and security with e.g. Tunisia, Morocco and Egypt (as a
first step towards a Mobility Partnership). These proposals are further
detailed in the Communication on migration, mobility and security in the
southern neighbourhood[17].
School co-operation (eTwinning), student and academic staff mobility within
university partnerships (Erasmus Mundus), structured cooperation for university
modernisation (Tempus), and mobility of Young People (Youth in Action) will
also be expanded to provide a better support to the youth. New initiatives may
also be promoted in the field of culture.

In the short term, to build sustainable
and inclusive economic development, the EU will step up efforts to enhance
the trade provisions of the existing Association Agreements by concluding the
ongoing negotiations on agriculture and those on services and the right of
establishment. Selected southern neighbours will also be given
the opportunity to enter into preparations for future DCFTA negotiations. To
accompany the structural adjustments linked to market opening and promote
inclusive growth, the Commission will finance pilot programmes for agricultural
and rural development and, drawing on the experience of the Eastern Partnership,
pilot regional development programmes.

The Commission will promote industrial
cooperation at Euro-Mediterranean level by continuing
to implement the Euro-Mediterranean Charter for Enterprise, by adapting the
Charter to the needs of SMEs in line with the EU’s Small Business Act and by
sharing good practices and opening activities and networks in priority sectors (textiles,
tourism, raw materials). It will enhance dialogue on employment and social policy and encourage effective social dialogue including through the
Euro-Mediterranean Social Dialogue Forum. Regulatory cooperation on a regional
level could facilitate trade exchanges and improve the investment climate. The
development of an efficient, safe, secure and sustainable multi-modal
Trans-Mediterranean Transport Network will also contribute to sustainable and
inclusive economic development. The Commission is already working with the EIB
and the International Maritime Organisation to identify pilot actions to
improve cooperation between maritime sectors in the Mediterranean.

The Union for the
Mediterranean (UfM) which complements the bilateral relations between EU
and partners should enhance its potential to organise effective and
result-oriented regional cooperation. It further ensures the inclusive
character of regional cooperation in the Mediterranean by including actors such
as Turkey and the Western Balkan countries. The High Representative and the
Commission are ready to play a bigger role in the UfM in line with the Lisbon
Treaty. Revitalising the UfM requires a switch to a more pragmatic and
project-based approach. The UfM Secretariat must
operate as a catalyst to bring states, the EIB, International Financial
Institutions and the private sector together around concrete economic projects
of strategic importance and generating jobs, innovation and growth throughout
the region. Partner countries' participation in these projects could follow the
principle of variable geometry depending on their needs and interests.
Co-financing for specific infrastructure projects from the EU budget could be
provided through the Neighbourhood Investment Facility. In the current economic
and political context, flagship projects identified at the Paris Summit remain
fully relevant, notably the Mediterranean Solar Plan, the de-pollution of the
Mediterranean or the development of Motorways of the Sea and land highways, the
Mediterranean Business Development Initiative. To support sustainable
development, implementation of existing regional agreements such as the
Barcelona Convention for the Protection of the Marine Environment and Coastal
Region of the Mediterranean should be given greater priority.

Finally, sub-regional
co-operation involving fewer neighbours and concentrating on specific
subjects can bring benefits and can create greater solidarity. Sub-regional
cooperation in the Maghreb could be advanced, for example through supporting
greater physical interconnection. The EU will put forward specific proposals in
the near future, including on ways to support the possible opening of borders
in the region.

4.           A simplified and coherent
policy and programme framework

4.1.        Clearer priorities through
stronger political steering

We shall: · Focus ENP Action Plans and EU assistance on a smaller number of priorities, backed with more precise benchmarks;

Bilateral relations between the EU and each
of its neighbours have become stronger in recent years. Close and intensive
dialogue has developed not only on general political matters but on all
specific areas of our co-operation. These very close relationships and a higher
level of commitment call for much stronger political dialogue and co-operation.
The Lisbon Treaty provides the means for the European
Union to deliver coherent and consistent policies and programmes by bringing
together strands of EU foreign and assistance policy that were previously run
by different institutions.

There is a
consensus among partner countries and Member States that more substantive
Association Councils would allow for more in-depth discussion at political
level. But political dialogue need not be reduced to a yearly discussion in the
Association Council: more frequent and more ad hoc opportunities should be
envisaged when conditions so require. A more continuous and more intimate
political dialogue is key to establish the confidence and trust required to
tackle our common challenges. In addition, the Commission intends to enhance
dialogue on sectoral policies (such as energy, education, youth, migration and
transport) with their Ministerial counterparts in partner countries.

While ENP Action Plans remain the
framework for our general cooperation, the EU will suggest to partners that
they focus on a limited number of short and medium-term priorities,
incorporating more precise benchmarks and a clearer sequencing of actions. The
EU will adapt the priorities for its financial assistance accordingly. This
list of priorities will set the political pace and help both the EU and each
neighbour to produce key deliverables, within a mutually agreed timeframe. This will also allow better linking of policy objectives and
assistance programming. Building on that basis programming documents can be
simplified and focus on identifying Action Plan priorities requiring particular
EU assistance.

Further simplification of provision of
financial assistance will also be sought in drafting the new European
Neighbourhood Instrument (ENI) regulation in the context of the next
multi-annual financial framework, in order to translate the need for a more
flexible and more focused delivery of financial assistance into practice.

In parallel, the EU will continue to report
on an annual basis on progress in line with the Action Plans. Reports will put
greater focus on democracy and a stronger link between the outcomes measured in
these reports, assistance and levels of financial support will be developed
over time.

4.2.        Funding

We shall: · re-focus and target foreseen and programmed funds in the ENPI as well as other relevant external policy instruments in the light of this new approach · provide additional resources of over EUR 1 billion until 2013 to address the urgent needs of our neighbourhood · mobilize budgetary reinforcement from various sources · swiftly proceed with submitting concurring budget proposals to the Budget Authority (transfers for 2011, Amending Letter for 2012, re-programming for 2013).

Implementing the new approach of the
neighbourhood policy based on mutual accountability and a shared commitment to
the universal values of human rights, democracy and the rule of law requires additional
resources of up to EUR 1242 million until 2013. These resources are in
addition to the EUR 5700 million provided under the European Neighbourhood and
Partnership Instrument for 2011-2013. In the event of new emergencies, funding
of actions targeted at the region under thematic instruments and crisis
intervention mechanisms in the EU budget constitute fresh resources. Financial
support will be provided to further reinforce the partnership with people
across the region, support sustainable and inclusive growth, cover the
additional needs stemming from the democratic transformation of partner
countries, advance the achievement of Millennium Development Goals and fund the
new initiatives stemming from this review, notably in the areas of partnership
with societies, rural and regional development (see sections 3.1 and 3.2
above). This includes an amount of up to EUR 250 million stemming from
reflows from older loan and risk-capital operations to be made available to the
Facility for Euro-Mediterranean Investment and Partnership (FEMIP) to promote
growth and employment by financing new operations and to support the long-term
financing needs of SMEs. To that effect, the Council should adopt the
Commission proposal to amend Article 23 of the ENPI regulation.

These additional resources will be provided
through reallocations from within Heading 4 of the 2007-2013 multi-annual
financial framework, and by making use of the unallocated margin under the
expenditure ceiling in 2012 and - to the extent necessary - through the
Flexibility Instrument. The Commission will submit an Amending Letter to Draft
Budget 2012 shortly.

The Commission is currently reflecting on
how best to integrate the overall country situation regarding democracy,
accountability, the rule of law and sound financial management into its
decisions on budget support arrangements, and will outline its approach in the
upcoming Communication on budget support. This should also provide the
necessary flexibility to tailor levels and types of support to each partner’s
reform track record.

4.3.        Involving the EIB and EBRD

We shall: · secure additional loan possibilities by the EIB and the EBRD, including an extension of the latter’s mandate to selected Southern partners

To support
large infrastructure projects that can help connect the EU with its
neighbourhood, boost development and address key energy, environment and
transport challenges, it is important to ensure that the European Investment
Bank and other regional development banks such as the European Bank for
Reconstruction and Development have sufficient financial resources. The
Commission supports the increase in the external mandate of the EIB for both
eastern and southern neighbours as well as the extension of the EBRD mandate to
selected southern Mediterranean countries. The EIB and
EBRD can deliver on EU policy objectives together by maximising their
comparative advantages. EBRD operations in the Southern
Mediterranean countries should support EU policy objectives and should not lead
to a transfer of resources from operations in the EU Eastern Neighbourhood.

The adoption of
the revised EIB external mandate would provide for increased EIB lending under
EU guarantee across the EU Neighbourhood. In particular, if the Council approves the additional lending envelope of EUR 1 billion proposed by the European Parliament, the EIB could provide almost EUR 6 billion to the Mediterranean
countries over 2011-2013. The
necessary funds up to 90 million will be mobilised to provide the budgetary
guarantees needed to match the increase in EIB loans towards the Mediterranean
region.

4.4.        Planning for 2013 and
beyond

We shall: · promote more flexible and simpler aid delivery under the post-2013 successor to the present ENPI; · step up efforts of co-ordination between the EU, its Member States and other key IFIs and bilateral donors.

In its July 2010 conclusions on the ENP the
Council acknowledged “the need to accompany market opening, economic
integration and regulatory convergence as well as the process of strengthening
bilateral relations, throughout the neighbourhood, with appropriate financial
support, technical assistance and capacity building” and indicated that it
“will return to the issue of financial support in the context of discussions on
the next multi-annual financial framework”. The Commission will reflect the
renewed ENP vision and medium term objectives in its proposals for the post-2013
EU Multi-annual Financial Framework[18].
The key source of funding, the new European Neighbourhood Instrument (ENI),
will provide the bulk of financial support to partner countries, essentially
through bilateral, regional and cross border co-operation programmes. Its level
of funding will need to reflect the ambitions of the revised ENP. It should be
increasingly policy-driven and provide for increased differentiation, more
flexibility, stricter conditionality and incentives for best performers, reflecting
the ambition of each partnership (e.g. DCFTA negotiations). EU assistance could
also be increasingly implemented by devolving it to partner countries provided
that the financial rules of the Union are respected and EU financial interests
protected.

To maximise external support for the reform
agenda agreed in the context of ENP the EU will step up efforts of
co-ordination with EU Member States, other bilateral donors, the EIB, the EBRD
and the international finance institutions. This can take the form of joint
programming, joint co-operation initiatives and co-financing programmes and
projects. To improve EU assistance co-ordination, the EEAS and Commission
services will consider the possibility of launching pilot joint programming
exercises with interested Member States in the countries of the southern
neighbourhood undergoing democratic transition.

Conclusions

Our
neighbourhood offers great opportunities for mutually beneficial integration
and co-operation, for example large and well-educated working populations,
sizeable markets still to be developed, and win-win solutions in energy
security. Cooperation with our neighbours is the only means to take on the
challenges and threats that do not respect borders — such as terrorism,
irregular migration, pollution of our common seas and rivers. It allows us to
tackle sources of instability and conflict in the region.

Several
neighbours in the East and in the South have embarked on an ambitious path of
transition during the last decade. They need support to consolidate these
processes. Others have joined the process only recently. They also need our
urgent assistance and they can benefit from the lessons learnt by other
partners. It is in the EU's own interest to support these transformation
processes, working together with our neighbours to anchor the essential values
and principles of human rights, democracy and the rule
of law, a market economy and inclusive, sustainable development in their political and economic fabric.

The new
approach to the ENP set out in this Communication is a step in this direction.
The Commission and the High Representative call on the Council and the European
Parliament to endorse both its overall thrust and the concrete proposals it
puts forward. We now intend to pursue our consultations with our neighbours on
the best way to translate this new approach into each individual partnership.

The challenges are many, and fully meeting
them may take time. What we are aiming for together is a democratic, prosperous
and stable region where more than 800 million people can live, work and shape
their own country’s future, confident that their freedom, their dignity and
their rights will be respected.

LEGISLATIVE FINANCIAL STATEMENT FOR PROPOSALS

1.           FRAMEWORK OF THE
PROPOSAL/INITIATIVE

1.1         Title of the
proposal/initiative

Joint Communication from the Commission and the High Representative
for Foreign and Security Policy: “A new response to a changing neighbourhood”

1.2.        Policy area(s) concerned
in the ABM/ABB structure[19]

External Relations

1.3.        Nature of the
proposal/initiative

 ̈ The
proposal/initiative relates to a new action

 ̈ The
proposal/initiative relates to a new action following a pilot
project/preparatory action[20]

X The proposal/initiative relates to the
extension of an existing action

 ̈ The
proposal/initiative relates to an action redirected towards a new action

1.4.        Objectives

1.4.1.     The Commission's
multiannual strategic objective(s) targeted by the proposal/initiative

Europe in the World: pulling our weight on the global stage

1.4.2.     Specific objective(s) and
ABM/ABB activity(ies) concerned

ABM/ABB activity (ies) concerned

19.08 European Neighbourhood Policy and relations with Russia

Specific objectives relating to the A BM activity

1. Furthering the conditions for close co-operation between the EU
and its neighbours and for regional and multilateral integration;

2. Supporting EU neighbours economic and
sector reforms and promote further integration with the EU and among
neighbouring countries themselves;

3. Promoting democracy, human rights and rule of law and contribute
to conflict resolution in the EU’s neighbourhood.

1.4.3.     Expected result(s) and
impact

Specify the effects
which the proposal/initiative should have on the beneficiaries/groups targeted.

The strategic review of the European Neighbourhood Policy (ENP) that
was undertaken last year identified areas where the policy can be considerably
strengthened. The revolutions and upheavals in the Southern Mediterranean and
the strong aspirations that the people of these countries have expressed for
political and economic change make the EU’s support even more crucial than in
the past, and point to areas where EU and Partner countries can and should do
better. Equally, the EU remains committed to durably supporting the
democratisation and reform processes in the entire neighbourhood, east and
south.

The Communication on the “A new response to a changing
neighbourhood” sets out the proposals emerging from the ENP strategic review
and, in that context fleshes out, the approaches towards Eastern Europe and the
Southern Caucasus through the continued implementation of the Eastern
Partnership and towards the Southern Mediterranean, in the context of the new “
Partnership for Democracy and shared Prosperity”. With the offer of a
“Partnership for Democracy and shared Prosperity”, in particular, the EU seeks
to support the democratic transformation initiated in Egypt and Tunisia, and
that may extend to other countries of the southern Mediterranean.

The new activities stemming from the review can be grouped in three
main components:

Component 1. Democratic transformation and institution-building (Relevant to the ABM specific objective 3 –above)

Support democratic transformation and institution-building through Comprehensive
Institution Building programme for democratic transformation and other
relevant actions addressing those institutions which are key to democratic
societies and assisting in the democratic reform of the security sector.

Expected Results

More respect for Human Rights and fundamental freedoms;

Better democratic governance;

A more independent and efficient judiciary;

A lower level of corruption;

Better democratic oversight on security sector;

Enhanced mobility linked to better border and migration management;

Legislation more in line with the EU acquis;

Component 2. Building a stronger partnership with people (Relevant to ABM Specific objective n 1 – see above)

Build a stronger partnership with the people by expanding contacts
between students, researchers and young people.

Increased student and academic staff mobility within university
partnerships (Erasmus Mundus) and structured
cooperation for university modernisation (Tempus);

Co-operation among schools initiated by opening the EU eTwinning
programme;

Increased contacts among young people;

ENP citizens (including in breakaway regions) more informed about
the achievements, opportunities and challenges of ENP.

Component 3. Sustainable and inclusive growth
and economic development (Relevant
to ABM Specific objective n 2 – see above)

Promote sustainable and inclusive growth by
supporting SMEs and addressing economic and social
disparities within a partner country through “pilot programmes” modelled on the EU Cohesion and Rural development policies

Reduction of internal economic disparities;

Increased employment;

Development of SMEs;

Enhanced vocational education and training;

Improved livelihood of farming communities;

Increased food security.

Increased integration in the EU internal market through
participation in EU programmes.

1.4.4.     Indicators of results and
impact

Specify the
indicators for monitoring implementation of the proposal/initiative.

Compliance with Human Rights and Democratic Standards as reported by
NGOs, UN and regional bodies

Adequately monitored democratic and credible elections;

Level of corruption;

Number of schools included in the eTwinning programme;

Number of university students and researchers participating in
Erasmus Mundus;

Number of structured university co-operation projects;

Level of wealth of farming communities;

Number of successful applications of ENP partners in EU programmes;

More sustainable provision of affordable food in the ENP countries;

Reduced level of economic and social disparities;

Reduced level of unemployment.

1.5.        Grounds for the proposal/initiative

1.5.1.     Requirement(s) to be met in
the short or long term

Policy Vision and Medium term goals

The long-term vision underpinning the ENP is a neighbourhood
in which each partner country develops its links with the EU as far as its own
aspirations, needs and capacities allow. Politically this includes an offer for
closer co-operation with the EU, including more joint initiatives in
international fora on global issues of common interest. Economically, the EU is
also open to closer economic integration, leading to progressive economic integration
in the EU internal market. It also supports the acceleration of inclusive,
sustainable growth in our neighbours, which should help them to become more
competitive, create decent jobs and to reach the Millennium Development Goals.
The EU should mobilise the full range of its policies according to mutual needs
and interests and to each country’s reform and democratisation commitments.

The goal is increased mutual commitment to the political and
economic well-being of our citizens —both Europe’s and neighbouring countries’—
as the best guarantee for our common stability and prosperity. Such a vision is
not without challenges. For partner countries the necessary reforms involve
substantial costs and efforts before the benefits can be reaped. On the EU
side, it is important not to jeopardise the smooth running of the internal
market and ensure that mobility takes place in a secure environment.

In the course of the next four to five years partner countries taking
decisive steps towards political and economic reforms can expect to conclude an
Association Agreement under the Eastern Partnership (East) or
enter in a Partnership for Democracy and Shared Prosperity (South). This
will be accompanied by enhanced mobility and people to people contacts (e.g.
including through the possible establishment of mobility partnerships),
economic integration through industrial cooperation, SME development, Foreign
Direct Investment and increased trade relations with the EU (e.g. through the
establishment of Deep and Comprehensive Free Trade Areas and the conclusions of
other agreements, e.g. in agriculture, services and establishment or Agreements
on Conformity Assessment and Acceptance of Industrial products for priority
sectors), deeper sector integration (e.g. through the integration in a
pan-European energy market and the participation in EU programmes and agencies
in accordance with the opening possibilities granted in each programmes and
with the general guidelines regarding the participation in EU Agencies).

With the offer of Partnership for Democracy and shared
Prosperity[21],
in particular, the EU seeks to support the democratic transformation initiated
in Egypt and Tunisia, and that may extend to other countries. To pursue with
determination the process of democratic transformation these countries need
support to reform their institutions and restart economic growth. Their
population also needs to see that the EU is ready to help in this challenging
but difficult period of transformation

Additional Funding

Implementing the new approach of the neighbourhood policy based on
mutual accountability and a shared commitment to the universal values of human
rights, democracy and the rule of law, will require additional resources of
up to EUR 1242 million until 2013. This will include:

a) The ENPI legal framework is well placed to sustain the bulk of
the new co-operation measures that have been identified in the review. For this
reason, the Commission proposes supplementing the ENPI envelope (EUR 750.5
million) from various sources, namely: EUR 355 million by re-deployment from
other instruments' envelopes and – for the 2012 tranche – the margin of Heading
4 in DB 2012 (EUR 241.5 million) as well as EUR154 million from the Flexibility
Instrument. The proposed increase can be implemented without formally revising
the ENPI regulation in accordance with point 37 of the Inter Institutional
Agreement on the 2007-13 financial perspective, as it represents a response to
“new, objective, long-term circumstances ... for which explicit and precise
reasons are given, with account being taken of the results obtained from
implementing the programme”. In as far as the current margin in DB 2012 has
been created by decreasing certain budget lines vis-à-vis the previous
Financial Programming, the proposed arrangement might also be considered
"re-deployment". More details will be submitted by means of an
Amending Letter;

b) deploying financing from other instruments such us the European
Instrument for Human Rights and Democracy (EIDHR) (EUR 13.4 million for the
years 2011-2012), the Non State Actors Thematic Programme within the
Development co-operation instrument (EUR 3.8 millions in 2011);

c) deploying the Instrument for Stability (EUR 40 million)[22];

d) setting aside EUR 90 million to provide the necessary guarantee
to leverage an extra billion of EIB lending in the Southern[23];

e) deploying the instrument of macro financial assistance EUR 100
million)[24],

f) allowing EIB to reuse reflows from old operations for capital
investment in SMEs (EUR 244 million).

The latter requires the Council to adopt the modification of Art.23
of the ENPI regulation.

In parallel, the existing National Indicative Programmes are being
refocused on the key objectives of the new partnership and EUR 150 million is
being reallocated from within the ENPI envelope to support the new ENP Civil
Society Facility and other actions to promote a stronger partnership with
societies.

Differentiation

While all partner countries will benefit from activities aimed at
strengthening the “partnership with societies” (component 2), funding under the
other two components will be allocated to partner countries on the basis of a
more for more approach based on mutual accountability.

Increased EU support will depend on progress in building and
consolidating democracy and respect for the rule of law. The more and the
faster a country progresses in its internal reforms, the more support it will
receive from the EU. This enhanced support will come in various forms, including
increased funding for social and economic development, larger programmes for
institution-building (CIB), greater market access, increased EIB financing in
support of investments; and greater facilitation of mobility. These
preferential commitments will be tailored to the needs of each country and to
the regional context. They will recognise that meaningful reform comes with
significant upfront costs. For countries where reform has not taken place, the
EU will reconsider or even reduce funding.

1.5.2.     Added value of EU
involvement

The proposal should be seen in the overall context of a renewed
European Neighbourhood Policy offering to partner countries closer political
co-operation and deeper economic integration in line with Art.8 of the Lisbon
treaty. It rests on sharing with our neighbours the experiences of European
integration and progressively involving them into EU policies. Because the EU
offer is largely based on the integration in the EU internal market, the EU is
better placed to provide such assistance than the Member States individually

1.5.3.     Lessons learned from
similar experiences in the past

Five country evaluations and two regional evaluations (MEDA II and
TACIS) have been conducted on past assistance to neighbouring countries. The main
sectors covered are: economic development (including trade), social sector
(including health and education), private sector, agriculture (including food
security) and energy (including nuclear).

Evaluations have shown that putting under the same umbrella (the ENPI) bilateral and regional
cooperation with countries formerly dealt with through two separate regulations
(TACIS and MEDA) has had a positive cross fertilisation effect, particularly
when it comes to aid delivery mechanisms in support of reforms. Building on the
positive results of experiences under MEDA[25],
support to reforms via the budget has significantly
increased since the introduction of ENPI and has delivered tangible results,
promoted reforms and helped strengthen policy dialogue with partner countries[26]. However the
approach should be further refined to incorporate the increased focus on
fundamental values and democratic governance. Efforts should also be made to
further associate Civil Society to the design and monitoring of operations and enhance
their visibility

On the other hand the introduction of a new
“tool box” based on the enlargement experience (TAIEX, Twinning and more
recently the EaP Comprehensive Institution Building Programmes) has increased
the ENPI capacity to deliver institution building projects and promote
regulatory convergence with the EU acquis. The cross border co-operation
component gave to ENPI a better mechanism to address co-operation among regions
across a shared border.

1.5.4.     Coherence and possible
synergy with other relevant instruments

While ENPI is the main instruments through which EU financial
co-operation with its neighbours is channelled, ENP countries also benefit from
other financial instruments addressing specific policy issues (global
challenges, Human Rights, Nuclear safety) or crisis situations (macro-financial
assistance, instrument for stability, humanitarian assistance instruments).

Some of these instruments have recently been mobilized to respond to
the emerging needs in EU’s southern neighbourhood and will continue to be used
in support of the transition processes in the Neighbourhood region.

In Tunisia, a 2 M€ package under the Instrument for Stability
was adopted to support 1) political reform and the electoral process and 2) the
independent civil society and the media. Further support to civil society is
also being planned under the European Instrument for Democracy and Human Rights
(EIDHR) in areas such as elections observation by national civil society,
training for political parties, support to freedom of expression and the
promotion of democratic values, and human rights monitoring capability EUR 2
million. Under the Development Co-operation Instrument thematic programme “Non
State Actors and local authorities” EUR 1.2 million have been earmarked for
Tunisia. Finally an EU electoral observation mission will be financed through
the EIDHR (up to EUR 4 million).

In Egypt EUR 2.9 million will be allocated under the European
Instrument for Democracy and Human Rights (EIDHR), to support actions to combat
torture, improve pre-detention conditions, and promote freedom of the media and
freedom of belief. EUR 2.6 million will be allocated under the “Non-State
Actors and Local Authorities” thematic programme (Development Co-operation
instrument) to promote Youth empowerment, women's rights and support to social
and economic rights.

The Humanitarian assistance instrument (EUR 70 million) has been
mobilised to address the consequences of the internal conflict in Libya and
assist refugees and displaced people and EUR 5 million stemming from the
Emergency Aid Reserve have been channelled through the Civil protection
mechanism has intervened to fund the repatriation of third country nationals.

1.6.        Duration and financial
impact

x Proposal/initiative of limited
duration

–
x   Proposal/initiative in effect from 2011 to
2013

–
x   Financial impact from 2011 to 2013

 ̈ Proposal/initiative of unlimited
duration

–
Implementation with a start-up period from YYYY
to YYYY,

–
followed by full-scale operation.

1.7.        Management mode(s)
envisaged[27]

x Centralised direct management
by the Commission

x Centralised indirect management
with the delegation of implementation tasks to:

–
x   executive agencies

–
 ̈ bodies set up by the Communities[28]

–
 ̈  national public-sector bodies/bodies with public-service mission

–
 ̈  persons entrusted with the implementation of specific actions
pursuant to Title V of the Treaty on European Union and identified in the
relevant basic act within the meaning of Article 49 of the Financial Regulation

 ̈ Shared management with the Member States

x Decentralised management with
third countries

x Joint management with
international organisations (to be specified)

Comments

The
objectives will be pursued through a combination of measures implemented
through different management modes, notably:

Institution
building actions will be mainly implemented through direct management by the
Commission;

Students
and youth exchanges, university and school co-operation will mostly be
implemented through the education, audiovisual and culture executive agency;

Pilot
programme modelled on the cohesion and agriculture policy will be implemented
either through centralised direct management or through decentralised
management.

Joint
management with international organisations can be used for specific actions
(i.e. supporting compliance with the Council of Europe Conventions). Delegated
co-operation could also be envisaged in the interest of aid effectiveness and
division of labour with Member States.

2.           MANAGEMENT MEASURES

2.1.        Monitoring and reporting
rules

Specify frequency
and conditions.

The Commission will monitor progress of its external co-operation on
all levels:

input (in particular financial flows:
commitments, contracts and payments);

activities / outputs (project and
programme execution, internal monitoring carried out on the spot by Commission
Delegations);

progress / outcome (external
Results-Oriented Monitoring - ROM[29])
and impact;

The programming of long-term external aid for partner countries and
regions is carried out in the framework of the preparation of strategy papers
(up to 7 years) and indicative programmes (3-4 years). These programming
documents can be reviewed at any time to re-adjust programming priorities.
Indicative programmes include the specific objectives and expected results for
each area of co-operation.

2.2.        Management and control
system

2.2.1.     Risk(s) identified

1) The lack of political and administrative stability in partner
countries may lead to difficulties in designing programmes, delays in
disbursing funds and loss of effectiveness;

2) The lack of sufficient administrative credits may lead to lack of
human resources for the management of assistance;

3) The poor application of quality standards may lead to poorly
designed programme and projects;

4) The lack of circulation of information may hamper the resolution
of problematic issues related to aid management.

2.2.2.     Control method(s) envisaged

Increase preparedness: identify the countries the most at risk,
develop a country-specific Risk Management Plan, follow up the developments in
those countries through several channels.

Sufficient administrative credits: Detailed programming of
administrative credits coming from both headings 4 and 5 of the Multi annual
Financial Framework 2007-13. Adjust allocation of staff resources between
services in HQ and Delegations based on needs forecasting and assessment of
workload vis-à-vis quantifiable criteria whenever possible (e.g. number of
contracts to be prepared).

Implementation and observation of standards & requirements
before and after the Quality Support Group; Delegations and the relevant
services in DG DEVCO to mobilise early in the process the needed expertise by
remote and on the spot support.

Improvement of system -Data quality and reporting: timely information
on the ongoing negotiations and ensure that all the problematic issues linked
to aid management are already well identified and transmitted to those who are
involved in the negotiations.

2.3.        Measures to prevent fraud
and irregularities

Specify existing or
envisaged prevention and protection measures.

The protection of the European Union’s financial interests and the
fight against fraud and irregularities form an integral part of the ENPI
Regulation. Administrative monitoring of contracts and payments will be the
responsibility of the EU Delegations in beneficiary countries. Each of the
operations financed under this regulation will be supervised at all stages in
the project cycle through the delegations[30].
Particular attention will be paid to the nature of expenditure (eligibility of
expenditure), to respect for budgets (actual expenditure) and to verify
supporting information and relevant documentation (evidence of expenditure).

3.           ESTIMATED FINANCIAL
IMPACT OF THE PROPOSAL/INITIATIVE

3.1.        Heading(s) of the
multiannual financial framework and expenditure budget line(s) affected

· Existing expenditure budget lines

In order of
multiannual financial framework headings and budget lines.

Heading of multiannual financial framework || Budget line || Type of expenditure || Contribution

Number [Description........................................] || DA/NDA ([31]) || from EFTA[32] countries || from candidate countries[33] || from third countries || within the meaning of Article 18(1)(aa) of the Financial Regulation

19.01.04.02 || ENPI Expenditure on Administrative Management || NDA || NO || NO || NO || NP

19.08.01 || European Neighbourhood Policy - Financial Co-operation || DA || NO || NO || NO || NP

|| || || || || ||

3.2.      Estimated
impact on expenditure EUR
million (to 3 decimal places)

Estimated Impact on Expenditure

Heading of multiannual financial framework || Heading 4 - External Relations

|| || || 2011 || 2012 || 213 || Total

|| || || || || ||

Operational Appropriations || || || || ||

|| || || || || ||

19.08.01 - European Neighbourhood Policy - Financial Co-operation || Commitments || (1) || 85,000 || 383,750 || 261,750 || 730,500

|| Payments || (2) || 0,000 || 115,125 || 104,700 || 219,825

|| || || || || ||

Appropriations of an administrative nature financed from the envelope of specific programmes (15) || || || || ||

|| || || || || ||

19.01.04.02 - ENPI Administrative credits || || (3) || 0,000 || 11,750 || 8,250 || 20,000

|| || || || || ||

Total appropriations for DG DEVCO || Commitments || 1+3 || 85,000 || 395,500 || 270,000 || 750,500

|| Payments || 2+3 || 0,000 || 126,875 || 112,950 || 239,825

|| || || || || ||

Total Operational Appropriations || Commitments || (4) || 85,000 || 383,750 || 261,750 || 730,500

|| Payments || (5) || 0,000 || 115,125 || 104,700 || 219,825

|| || || || || ||

Appropriations of an administrative nature financed from the envelope of specific programmes || || 0,000 || 11,750 || 8,250 || 20,000

|| || || || || ||

Total Appropriations || Commitments || || 85,000 || 395,500 || 270,000 || 750,500

|| Payments || || 0,000 || 126,875 || 112,950 || 239,825

(15). Technical and/or administrative assistance and expenditure in support of the implementation of EU programmes and/or actions (former "BA" lines), indirect research, direct research.

3.2.1.     Estimated impact on operational
appropriations

–
 ̈  The proposal/initiative does not require the use of operational
appropriations

–
X  The proposal/initiative requires the use of
operational appropriations, as explained below:

Commitment appropriations in EUR million (to 3 decimal places)

Indicate objectives and outputs || || || Year - 2011 || Year - 2012 || Year - 2103 || TOTAL

ò || OUTPUTS

Type of output || Average cost || Number || Cost || Number || Cost || Number || Cost || Total number of outputs || Total

of the output || of outputs || of outputs || of outputs || cost

COMPONENT 1 - DEMOCRATIC TRANSFORMATION AND INSTITUTION BUILDING || || || || || || || ||

Comprehensive Institution Building Programmes * || Programme || 40 || 3 || 20 || 3 || 63 || 3 || 42 || 3 || 125

Mobility Partnerships * || Programme || 8 || 3 || 5 || 3 || 10 || 3 || 10 || 3 || 25

Sub-total for Component 1 || || 25 || || 73 || || 52 || || 150

COMPONENT 2 - PARTNERSIP WITH PEOPLE || || || || || || || ||

Erasmus Mundus- Student Mobility || Student/year || 0,035 || 857 || 30 || 1286 || 45 || 1000 || 35 || 3143 || 110

TEMPUS - University Co-operation || Projects || 0,9 || 6 || 5 || 14 || 12.5 || 14 || 12.5 || 33 || 30

Youth - Projects || Projects || 0,02 || 500 || 10 || 875 || 17,5 || 875 || 17,5 || 2250 || 45

Other outputs || || n.a || || 5 || || 11,25 || || 9,75 || || 26

Sub-total for Component 2 || || 50 || || 86,25 || || 74,75 || || 211

COMPONENT 3 - SUSTAINABLE AND INCLUSIVE GROWTH AND ECONOMIC DEVELOPMENT || || || || || || || ||

Pilot Cohesion Programmes || Programme || 40 || 3 || 0 || 3 || 85 || 3 || 40 || 3 || 125

Pilot Agriculture and Rural Development programmes || Programme || 30 || 6 || 10 || 6 || 110 || 6 || 65 || 6 || 185

Participation in EU Programmes** || n.a. || n.a. || 5,95 || || 5,95 || || 5,95 || || 5,95 ||

Sub-total for Component N°3 || || 10 || || 224,5 || || 135 || || 369,5

TOTAL COST || || 85 || || 383,75 || || 261,75 || || 730,5

*Delivered in the form of multi-annual IB programme covering a period of three years. The average cost refers to 3 years. ** Funding set aside to contribute to partner countries participation in EU programmes. The individual contribution depends on the programme and the country and cannot be estimated Most of the related human resources will be needed in delegations in the concerned beneficiary countries precisely at this stage

N.B. It should be underlined that the breakdown of the activities and their allocations among components can only, at this stage, be indicative and the above outputs are based on initial estimates and been presented for illustrative purposes.

3.2.2. Estimated impact on
appropriations of an administrative nature

3.2.2.1.  Summary

–
X  The proposal/initiative does not require the
use of administrative appropriations

–
 ̈  The proposal/initiative requires the use of administrative
appropriations, as explained below:

EUR million (to 3
decimal places)

|| Year N [34] || Year N+1 || Year N+2 || Year N+3 || ... enter as many years as necessary to show the duration of the impact (see point 1.6) || TOTAL

HEADING 5 of the multiannual financial framework || || || || || || || ||

Human resources || || || || || || || ||

Other administrative expenditure || || || || || || || ||

Subtotal HEADING 5 of the multiannual financial framework || || || || || || || ||

Outside HEADING 5[35] of the multiannual financial framework || || || || || || || ||

Human resources || || || || || || || ||

Other expenditure of an administrative nature || || || || || || || ||

Subtotal outside HEADING 5 of the multiannual financial framework || || || || || || || ||

TOTAL || || || || || || || ||

3.2.2.2.  Estimated requirements of
human resources

–
 ̈  The proposal/initiative does not require the use of human
resources

–
X The proposal/initiative requires the use of
human resources, as explained below:

Estimate to be expressed in full amounts
(or at most to one decimal place)

|| || Year 2011 || Year 2012 || Year 2013

Ÿ Establishment plan posts (officials and temporary agents) ||

|| XX 01 01 01 (Headquarters and Commission’s Representation Offices) || || ||

|| XX 01 01 02 (Delegations) || || ||

|| XX 01 05 01 (Indirect research) || || ||

|| 10 01 05 01 (Direct research) || || ||

|| Ÿ External personnel (in Full Time Equivalent unit: FTE)[36] ||

|| XX 01 02 01 (CA, INT, SNE from the "global envelope") || || ||

|| XX 01 02 02 (CA, INT, JED, LA and SNE in the delegations) || || ||

|| 19 01 04 02 [37] || - at Headquarters[38] || 0 || ||

|| || - in delegations || || 131 || 92

|| XX 01 05 02 (CA, INT, SNE - Indirect research) || || ||

|| 10 01 05 02 (CA, INT, SNE - Direct research) || || ||

|| Other budget lines (specify) || || ||

|| TOTAL || || 131 || 92

The human resources required will be met
by staff from the DG who are already assigned to management of the action
and/or have been redeployed within the DG, together if necessary with any
additional allocation which may be granted to the managing DG under the annual
allocation procedure and in the light of budgetary constraints.

Description of tasks to be carried out:

Additional staff is necessary to manage the
additional resources and implement the new initiatives which are part of the
ENP review. The nature of the new activities to be implemented under the ENP
review such as the Partnership for Democracy and Shared prosperity,
(institution building, people to people contacts to be implemented through
relatively small project, support for civil society ...) requires substantial
staffing to manage and supervise programmes. Most of the related human
resources will be needed in delegations in the concerned beneficiary countries and at the Executive Agency for Education, Audiovisual and Culture
(for managing education, youth and culture programmes).

In as far as additional operational funds
stem from redeployment from other instruments' envelopes, the related administrative
support expenditure will also be re-allocated accordingly. The administrative
appropriations to be transferred from other instruments' envelopes amount to
6,78M € in 2012 and 8,25M € in 2013. These account for the redeployment of,
respectively, some 76 full-time equivalent (FTE) in 2012 and 92 FTE in 2013
from the other instruments.

The Unit Cost for external staff in
Delegations has been calculated at 88.937 €. which is the average of the
estimated cost for a contract agent (134.120 €) and the estimated cost of a
local agent (43.754 €) in the DB 2012 for budget line 19.010402.

Officials and temporary agents ||

External personnel || 131 FTE/year in 2012 and 92 FTE/year in 2013 for a total cost of EUR 20 million (EUR 11.75 million in 2012 and EUR 8.25 million in 2013)

3.2.3.     Compatibility with the
current multiannual financial framework

–
 ̈  Proposal/initiative is compatible the current multiannual
financial framework.

–
X  Proposal/initiative will entail reprogramming
of the relevant heading in the multiannual financial framework.

The additional funding for the activities identified in this
statement will be largely financed through the reprogramming of the envelopes
of the external relations instruments which are part of Heading 4 of the
Multi-annual financial framework for the benefit of ENPI (both operational
appropriations and administrative credits).

For 2011, the bulk of the additional EUR 85 million will come from
transfer of resources from the Development Co-operation Instrument (EUR 51
million) from a reduction of the EU contribution to EBRD (EUR 34 million).

For 2012 the additional EUR 395.5 million will come from: 1) the
Heading 4 margin (EUR 241.5) which includes appropriations initially programmed
for the Development Co-operation Instrument (EUR 89 million), the Instrument
for Pre-accession Assistance (EUR 60 million) and the Instrument for Stability
(EUR 60 million) and 2) the Flexibility Instrument (EUR 154 million).

For 2013, the additional EUR 270 million are foreseen to come
through a transfer of resources from the Development Cooperation Instrument
(EUR 100 million) the Instrument for Pre-Accession Assistance (EUR 60 million),
the Instrument for Stability (EUR 70 million); and redeployment from other
instruments notably the Common Foreign and Security Policy budget (EUR 40
million)[39].

–
X  Proposal/initiative requires application of
the flexibility instrument[40].

As indicated above, the provision of additional resources to finance
the activities described in this statement will require the mobilisation of the
flexibility instrument in 2012 for EUR 154 million.

The Commission will proceed swiftly with submitting the pertinent
budget proposals to the Budget Authority (transfers for 2011, Amending Letter
for 2012, re-programming for 2013).

3.2.4.     Third-party contributions

–
The proposal/initiative does not provide for
co-financing by third parties

–
The proposal/initiative provides for the
co-financing estimated below:

Appropriations in EUR million (to 3 decimal places)

|| Year N || Year N+1 || Year N+2 || Year N+3 || ... enter as many years as necessary to show the duration of the impact (see point 1.6) || Total

Specify the co-financing body || || || || || || || ||

TOTAL appropriations cofinanced || || || || || || || ||

3.3.        Estimated impact on
revenue

–
X  Proposal/initiative has no financial impact
on revenue.

–
 ̈  Proposal/initiative has the following financial impact:

–
 ̈         on own resources

–
 ̈         on miscellaneous revenue

EUR million (to 3 decimal places)

Budget revenue line: || Appropriations available for the ongoing budget exercise || Impact of the proposal/initiative[41]

Year N || Year N+1 || Year N+2 || Year N+3 || ... insert as many columns as necessary in order to reflect the duration of the impact (see point 1.6)

Article ............. || || || || || || || ||

For miscellaneous
assigned revenue, specify the budget expenditure line(s) affected.

[...]

Specify the method for
calculating the impact on revenue.

[...]

[1]           The
European Neighbourhood includes Algeria, Armenia, Azerbaijan, Belarus, Egypt,
Georgia, Israel, Jordan, Lebanon, Libya, the Republic of Moldova, Morocco, the
Occupied Palestinian Territories, Syria, Tunisia and Ukraine.

[2]               COM (2011) 200 of 8.03.2011.

[3]               While the objectives and financial and managerial
modalities of this Endowment will be different from the other democratisation
tools, they shall be applied with a view to reinforce synergies and coherence.

[4]               The EIF has specific
experience as a provider of risk financing to small and
medium-sized enterprises (SME) in EU and enlargement countries and an extensive
network of business contacts. It is therefore ideally placed to promote investments
of EU SMEs in partner countries.

[5]               The scope of the European Neighbourhood Programme for
Agriculture and Rural Development (ENPARD) included in the Communication
"Partnership for Democracy and Shared Prosperity with the southern
Mediterranean" - COM(2011) 200 - will be expanded to also cover the
eastern neighbourhood.

[6]               See COM(2006) 726, 4.12.2006, Strengthening the
European Neighbourhood Policy.

[7]           TAIEX is
the Technical Assistance and Information Exchange instrument managed by
Commission services. TAIEX supports partner countries with regard to the
approximation, application and enforcement of EU legislation. It is largely
demand-driven and facilitates the delivery of appropriate tailor-made expertise
to address issues at short notice; http://ec.europa.eu/enlargement/taiex/what-is-taiex/index_en.htm

[8]               In its
Communication on the EU 2020 Initiative “Resource efficient Europe”
COM(2011)21, the Commission highlighted the need to cooperate closely with key
partners including those in neighbourhood.

[9]               COM(2006) 724, 4.12.2006

[10]             COM(2011) 248 final, 4.5.2011

[11]             The Commission will finance capacity-building under the
European Neighbourhood and Partnership Instrument (ENPI).

[12]             In line with the Communication on a Dialogue for
migration, mobility and security with the southern Mediterranean countries -
COM(2011)292/3

[13]             These are: Integrated Border Management; Small and
Medium Enterprises; Regional Electricity Markets, Energy Efficiency and
Renewable Energy Sources; Prevention, Preparedness and Response to Natural and
Man-made Disasters; Environmental Governance.

[14]             Action
Plan Implementing the Stockholm Programme - COM(2010) 171:
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2010:0171:FIN:EN:PDF.

[15]             COM(2011) 200.

[16]             The advanced status, based on the good implementation
of the ENP Action Plan, was granted to Morocco in 2008 and to Jordan in 2010.
It could be extended to other ENP Southern countries making progress in
reforms. Depending on the country it may entail the strengthening of political
and security cooperation, trade concessions and greater integration in the EU
Internal Market and additional financial support for reforms. It is based on a
new and more comprehensive Action Plan.

[17]             COM (2011) 292/3

[18]             The Commission’s proposals will be tabled later this
year.

[19]             ABM: Activity-Based Management – ABB: Activity-Based
Budgeting.

[20]             As referred to in Article 49(6)(a) or (b) of the
Financial Regulation.

[21]             COM(2011) 200, 8.3.2011

[22]             The exact amount to be mobilised under the IfS will
depend on identifying suitable projects. Should these projects amount to less
than 40 million the balance will be transferred to ENPI).

[23]             If the Council and Parliament agree to also increase
the Eastern Neighbourhood ceiling in the context of the mid-term review of the
EIB external mandate, the necessary amount will be set aside for provisioning
the Guarantee Fund. It should be noted that, in line with Guarantee Fund
Regulation (Council Regulation (EC, Euratom) No 480/2009), the necessary
provisioning will take place over several years starting from 2013.

[24]             The exact amount to be mobilised under the instrument
will depend on the financing needs of the countries eligible to MFA, identified
in the context of economic stabilisation and reform programmes implemented with
the support of the IMF. Should the amount of MFA programmes be less than 100
million the balance could be transferred to ENPI.

[25]             Cf. main conclusions of the "Evaluation of the
MEDA II Regulation and its implementation"
(June 2009)

[26]             As exemplified by the conclusions of the Evaluation of
Budget Support operations in Tunisia (November 2010)

[27]             Details of management modes and references to the
Financial Regulation may be found on the BudgWeb site: http://www.cc.cec/budg/man/budgmanag/budgmanag_en.html

[28]             As referred to in Article 185 of the Financial
Regulation.

[29]             The results-oriented monitoring system (ROM) allows a
rapid appreciation of a project or programme’s performance, as well as of its
wider implications and provides the Commission with independent advice on its
project portfolio. Having one consistent approach ensures that the Commission
has comparable data for all regions where it provides
external assistance.

[30]             They shall authorise the Commission (OLAF) to carry out
on-the-spot checks and inspections in accordance with Council Regulation
(Euratom, EC) No 2185/96 of 11 November 1996.

[31]             DA= Differentiated appropriations / DNA=
Non-Differentiated Appropriations

[32]             EFTA: European Free Trade Association.

[33]             Candidate countries and, where applicable, potential
candidate countries from the Western Balkans.

[34]             Year N is the year in which implementation of the
proposal/initiative starts.

[35]             Technical and/or administrative assistance and
expenditure in support of the implementation of EU programmes and/or actions
(former "BA" lines), indirect research, direct research.

[36]             CA= Contract Agent; INT= agency staff ("Intérimaire");
JED= "Jeune Expert en Délégation" (Young Experts in
Delegations); LA= Local Agent; SNE= Seconded National Expert;

[37]             Under
the ceiling for external personnel from operational
appropriations (former "BA" lines).

[38]             Essentially for Structural Funds, European Agricultural
Fund for Rural Development (EAFRD) and European Fisheries Fund (EFF).

[39]             To be initiated on the basis of the proposal of the
High Representative and in accordance with the specific rules applying to the
CFSP budget.

[40]             See points 19 and 24 of the Interinstitutional
Agreement.

[41]             As regards traditional own resources (customs duties,
sugar levies), the amounts indicated must be net amounts, i.e. gross amounts after
deduction of 25% for collection costs.