# EUR-Lex - 52011SC1476 - EN

*|*

# 52011SC1476

**COMMISSION STAFF WORKING PAPER EXECUTIVE SUMMARY OF THE IMPACT ASSESSMENT /* SEC/2011/1476 final - COD 2011/0411 */**

			*

			*

1. 
Problem definition

The fundamental challenge the proposed
Partnership Instrument addresses is a consequence of globalisation: the texture
of the world economy is changing, power is shifting, prosperity is diffusing;
new players increasingly shape the international agenda. The G-20 is one symbol
of this change: the perception that a new international order is slowly
replacing the former power structure is very much grounded in reality, even if
the pace of the change may sometimes be overstated.

In particular

*The emergence of new powers such as India
and China, or South Africa and Brazil, has changed the international order as
these countries are playing an increasingly important role in international
economy and trade, in multilateral fora (UN, G-20) and in addressing challenges
of global concern. Whilst development and poverty alleviation remain key
concerns, these countries are progressively leaving behind the status of
developing nations.

*The EU has developed broad based binding
agreements with key partners and emerging economies to address bilateral issues
and matters of global concern. The implementation of these agreements requires
a toolbox, a dedicated financing instrument so that the EU has the means to
promoting its interests worldwide, and to deal with global issues wherever the
need arises.

*The current Instrument for Cooperation
with Industrialised (ICI) countries has a limited geographical scope; it covers
only 17 countries and high income territories; whereas the Development
Cooperation Instrument (DCI) covers countries such as India, China, South
Africa and Brazil but only for official development assistance expenditure.

*Relations and economic ties between the EU
and Russia have evolved considerably underlining the importance of Russia as a
strategic partner far beyond development cooperation. The need for financial
assistance has declined. Russia aspires to a relation of equals and has become
a donor itself. The proposed Partnership Instrument would become the main
instrument for cooperation with Russia.

2. 
Analysis of subsidiarity

The EU has numerous international agreements
with partner countries all over the world,
not matched by individual Member States, which gives to all of them influence
in virtually all fields of international relations. With 27 Member States
acting within common policies and strategies, the EU has a critical
weight to respond to global challenges. The EU is also in a unique position to
promote EU norms and standards, and turn them into global standards through
international cooperation.

3. 
Objectives of EU initiative

The EU currently does not possess an
instrument that would allow it to co-operate with new emerging and emerged
powers on issues related to advancing core EU interest and on common challenges
of global concern (such as climate change for instance).

For the moment, such cooperation is
possible under the Instrument for Cooperation with Industrialised Countries
(ICI) which is however limited to 17 highly industrialised or high-income
countries (e.g. United States, Japan, Korea, Gulf states).

Cooperation with countries such as China,
India and Brazil falls under the Development Cooperation Instrument (DCI)
meaning that this cooperation is confined to actions that relate directly to
poverty alleviation/eradication in the beneficiary countries.

The proposed Partnership Instrument is
designed to overcome this limitation of the EU’s ability to engage
internationally in the most effective way. It would fill the gap described
above and allow us in particular to pursue agendas beyond development
cooperation with new powers, but also enable us to defend the core EU agenda
globally with any other partner country if the need arises.

It will pursue the following specific
objectives:

(a) 
implementing the international dimension of the
“Europe 2020” strategy by supporting EU bilateral, regional and inter-regional
cooperation partnership strategies, by promoting policy dialogues and by
developing collective approaches and responses to challenges of global concern;

(b) 
improving market access and developing trade,
investment and business opportunities for European companies, in
particular SMEs, by means of economic partnerships and business and regulatory
cooperation;

(c) 
enhancing widespread understanding and
visibility of the Union and its role on the world scene by means of public
diplomacy, education/academic cooperation and outreach activities to promote
Union’s values and interests.

4. 
Policy options

In principle, there are four available
policy options: discontinue ICI; status-quo; amend DCI to allow for expenditure
that is not ODA; a new instrument building on ICI/ICI+.

After careful evaluation, neither
discontinuing ICI nor maintaining the status-quo are deemed to be politically
viable solutions. Limiting ourselves exclusively to expenditure linked to
poverty alleviation, or maintaining this sole focus for co-operation with
emerging powers would artificially limit the EU’s diplomatic agenda and neglect
core EU interests.

The option of amending the Development
Co-operation Instrument to allow for expenditure not related to official
development assistance would have the advantage of geographical coherence (one
instrument per country), but the difficulties of managing an instrument with
two very different objectives are considered a serious handicap.

5. 
Assessment of impacts

Economic:

The implementation of a new Partnership
Instrument would provide the EU with another window of opportunity to promote
its enterprises (SMEs in particular) and products. It would create the
financial possibility to support EU business in third countries, providing
incentives for EU competitiveness and innovation in a way that should remain
complementary to the actions financed under the Competitiveness and SME
programme and under Horizon 2020 (research and innovation), support EU
international trade and investment which, in turn, could lead to the
facilitation of foreign investment into the EU. Numerous areas of cooperation
could be pursued including climate change, environment, approximation of
technical regulations and standardisation, corporate social responsibility,
intellectual property rights, protection of personal data, best practises in
economic, trade and financial matters. Thus, the EU’s economic security could
be strengthened and new jobs created which, ultimately, would contribute to
economic growth. The new Instrument could foster well developed forms of
economic cooperation between the EU and partner countries. In this context, it
would allow the EU to ensure that environmental, sustainable energy, social,
employment and other welfare values are adequately considered in policy
programme design and implementation.

Social:

By harmonising the EU and EU Member States’
financing instruments and by supporting joint activities with other bilateral
and multilateral donors, the new Instrument could have an important impact on
the social fabric of emerging countries. It could provide support to the reform
of welfare systems, national employment policies, national training and skills’
development policies, education and research programmes and the strengthening
of national safety “nets”. Its contribution to extra “green” jobs creation,
income- per-capita increases and effective social cohesion and poverty
alleviation strategies at national level will be relevant. In this respect it
would contribute to successful implementation of the international social
agenda promoted by the UN International Labour Organisation and G8/G20.

Environment:

EU partnerships through the new Instrument
will aim at encouraging and supporting growth and long-term environmental
sustainability. In this respect, the new Instrument is expected to play a key
role in providing support for both EU and partner countries’ environmental and
climate change-related actions and policy dialogues. The Instrument could
support a low-carbon business model by providing incentives to the European
private sector. Building on the successful results of the COP-16 United Nations
Conference on Climate Change in Cancún, it could be used to help EU business to
develop effective and least-cost policies to achieve environmentally friendly
goals in the partner countries. It will also help partner countries’ economies to
reap the full environmental, ecological and energy-efficient benefits of
innovation. The Instrument could allow cooperation to better understand the
economic and social costs of biodiversity loss and ecosystem degradation in
countries of global significance.

6. 
Comparison of options

Proceeding by elimination, it was judged
that extending the scope of the Development Cooperation Instrument to cover
non-developmental actions creates the risk of tension between different
objectives, and could lead to significant delays in decision-making and
implementation. It was preferred to recommend the creation of a single, new and
global instrument focused on defending core EU interests and addressing
challenges of global concern whose scope of activities would be clearly
defined. Therefore, the recommendation is to propose a new instrument building
on ICI/ICI+.

7. 
Monitoring and evaluation

Budget: EUR 1.0 billion over the period 2014-2020
(equal to 1/70, or 1.4% approximately, of overall envelope foreseen for
expenditure under the external relations heading).

The Partnership Instrument shall be an
enabling Regulation establishing the essential elements and the basis for the
EU intervention. The exact actions are defined through annual action programmes
detailing the activities to be carried out by the EU, including the operational
objectives and the expected results. Operational indicators are fixed at that
moment, taking into account the particularities of the action in question.

Progress towards the three specific
objectives (see above under 3) will be monitored through the following core
impact indicators:

(1) 
Influence of EU policies on policy formulation
in key strategic partner countries covered by this instrument.

(2) 
EU share in world trade as well as in trade
with countries targeted by actions under this instrument.

(3) 
Perception of EU in key strategic partner
countries covered by this instrument.

Typical indicators to measure the impact of
the Partnership Instrument’s activities will be the number of participant
enterprises, the extent, relevance and sophistication of support activities,
the degree of cooperation within the European business network and division of
labour, entrepreneurial user satisfaction and
achievement of economic targets, i.e. the measurable impact on job creation,
turnover, foreign direct investment of EU enterprises and overall EU exports to
target markets. Indicators to measure the impact of these activities,
both qualitative and quantitative, will be related to the trends in knowledge
exchange, the number of reciprocal academic exchanges, the number of
participants in programmes, scholarships and joint research and academic
projects. The results will also be measured by the frequency and quality of
media coverage, the local demand for EU sponsored activities, the participation
rate at EU events.