EN    EN EN 
EN    EN  COMMISSION OF THE E UROPEAN COMMUNITIES 
Brussels, 15.12.2008 
SEC(2008) 3026 
COMMISSION STAFF WORKING DOCUMENT 
TECHNICAL ANNEXES 
  
TO THE REPORT FROM THE COMMI SSION TO THE COUNCIL, THE 
EUROPEAN PARLIAMENT AND THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE 
2007 ANNUAL IPA REPORT 
 
{COM(2008) 850 final} 
EN 2   EN TABLE OF CONTENTS 
COMMISSION STAFF WORK ING DOCUMENT TECHNIC AL ANNEXES ...................... 1 
PART I: COUNTRY SECTION ................................................................................................ 9 
1. ALBANIA.................................................................................................................... 9  
1.1. The year in review........................................................................................................ 9 
1.1.1.  Political developments ............................................................................................... 9 
1.1.2.  Macroeconomic developments and structural reforms ........................................ 10 
1.1.3.  Progress in meeting the acquis communautaire .................................................... 10 
1.2. IPA in 2007 ............................................................................................................... . 12 
1.2.1.  MIPD 2007-2009 ....................................................................................................... 12 
1.2.2.  Programming exercise ............................................................................................. 13 
1.2.2.1.  Component I: Transition Assistance and Institution Building ................................... 13 
1.2.2.2.  Component II: Cross-Border Cooperation ................................................................ 14 
1.2.3.  Implementation Modalities and Structures ........................................................... 14 
1.2.4.  Overview of IPA programmes implemented ......................................................... 15 
1.2.5.  Participation in Community  Programmes and Agencies ..................................... 15 
1.3. Monitoring and Results.............................................................................................. 15 1.3.1.  Monitoring ................................................................................................................ 15 
1.3.2.  Evaluation results and Lessons Learned ............................................................... 15 
1.3.3.  Sectors with positive results - Success story box ................................................... 15 
2. BOSNIA and HERZEGOVINA ................................................................................ 16 2.1. The year in review...................................................................................................... 16  
2.1.1.  Political developments ............................................................................................. 16 
2.1.2.  Macroeconomic developments and structural reforms ........................................ 17 
2.1.3.  Progress in meeting the acquis communautaire .................................................... 17 
2.2. IPA in 2007 ............................................................................................................... . 19 
2.2.1.  MIPD 2007-2009 ....................................................................................................... 19 
2.2.2.  Programming exercise ............................................................................................. 20 
2.2.2.1.  Component I: Transition Assistance and Institution Building ................................... 20 
EN 3   EN 2.2.2.2.  Component II: Cross-Border Cooperation ................................................................ 20 
2.2.3.  Implementation Modalities and Structures ........................................................... 21 
2.2.4.  Overview of IPA programmes implemented ......................................................... 21 
2.2.5.  Participation in Community  Programmes and Agencies ..................................... 21 
2.3. Monitoring and Results.............................................................................................. 21 2.3.1.  Monitoring ................................................................................................................ 21 
2.3.2.  Evaluation results and Lessons Learned ............................................................... 21 
2.3.3.  Sectors with positive results - Success story box ................................................... 22 
3. CROATIA.................................................................................................................. 23 3.1. The year in review...................................................................................................... 23  
3.1.1.  Political developments ............................................................................................. 23 
3.1.2.  Macroeconomic developments and structural reforms ........................................ 23 
3.1.3.  Progress in meeting the acquis communautaire .................................................... 23 
3.2. IPA in 2007 ............................................................................................................... . 24 
3.2.1.  MIPD 2007-2009 ....................................................................................................... 24 
3.2.2.  Programming exercise ............................................................................................. 25 
3.2.2.1.  Component I: Transition Assistance and Institution Building ................................... 26 
3.2.2.2.  Component II: Cross-Border Cooperation ................................................................ 26 
3.2.2.3.  Component III: Regional Development ..................................................................... 27 
3.2.2.4.  Component IV: Human Resources Development ....................................................... 28 
3.2.2.5.  Component V: Rural Development ............................................................................ 28 
3.2.3.  Implementation Modalities and Structures ........................................................... 28 
3.2.4.  Overview of IPA programmes implemented ......................................................... 29 
3.2.5.  Participation in Community  Programmes and Agencies ..................................... 29 
3.3. Monitoring and Results.............................................................................................. 29 
3.3.1.  State of play for IPA Monitoring Committee and Sectoral Monitoring 
Committees ............................................................................................................... 29 
3.3.2.  Annual and final reports on implementation ........................................................ 30 
3.3.3.  Evaluation results and Lessons learned ................................................................. 30 
3.3.4.  Sectors with positive results- Success story ........................................................... 30 
4. FORMER YUGOSLAV REPU BLIC of MACEDONIA .......................................... 32 
EN 4   EN 4.1. The year in review...................................................................................................... 32  
4.1.1.  Political developments ............................................................................................. 32 
4.1.2.  Macroeconomic developments and structural reforms ........................................ 32 
4.1.3.  Progress in meeting the acquis communautaire .................................................... 32 
4.2. IPA in 2007 ............................................................................................................... . 32 
4.2.1.  MIPD 2007-2009 ....................................................................................................... 32 
4.2.2.  Programming exercise ............................................................................................. 33 
4.2.2.1.  Component I: Transition Assistance and Institution Building ................................... 33 
4.2.2.2.  Component II: Cross-Border Cooperation ................................................................ 34 
4.2.2.3.  Components III and IV: Strategic Coherence Framework ........................................ 34 
4.2.2.4.  Component III: Regional Development ..................................................................... 34 
4.2.2.5.  Component IV: Human Resources Development ....................................................... 35 
4.2.2.6.  Component V: Rural Development ............................................................................ 35 
4.2.3.  Implementation Modalities and Structures ........................................................... 36 
4.2.4.  Overview of IPA programmes implemented ......................................................... 36 
4.2.4.1.  Component I: Transition Assistance and Institution Building ................................... 36 
4.2.4.2.  Component II: Cross-Border Cooperation ................................................................ 36 
4.2.4.3.  Component III: Regional Development ..................................................................... 36 
4.2.4.4.  Component IV: Human Resources Development ....................................................... 36 
4.2.4.5.  Component V: Rural Development ............................................................................ 37 
4.2.5.  Participation in Community  Programmes and Agencies ..................................... 37 
4.3. Monitoring and Results.............................................................................................. 37 
4.3.1.  State of play for IPA Monitoring Committee and Sectoral Monitoring 
Committees ............................................................................................................... 37 
4.3.2.  IPA Monitoring Committee .................................................................................... 37 
4.3.2.1.  Component I ............................................................................................................... 37 
4.3.2.2.  Component II .............................................................................................................. 37 
4.3.2.3.  Component III ............................................................................................................ 38 
4.3.2.4.  Component IV ............................................................................................................. 38 
4.3.2.5.  Component V .............................................................................................................. 38 
4.3.3.  Annual and final reports on implementation ........................................................ 38 
EN 5   EN 4.3.4.  Evaluation results and Lessons learned ................................................................. 38 
4.3.5.  Sectors with positive results – Success story .......................................................... 39 
5. KOSOVO (under UNSCR 1244/99).......................................................................... 40 5.1. The year in review...................................................................................................... 40  
5.1.1.  Political developments ............................................................................................. 40 
5.1.2.  Macroeconomic developments and structural reforms ........................................ 40 
5.1.3.  Progress in meeting the acquis communautaire .................................................... 40 
5.2. IPA in 2007 ............................................................................................................... . 41 
5.2.1.  MIPD 2007-2009 ....................................................................................................... 41 
5.2.2.  Programming exercise ............................................................................................. 42 
5.2.2.1.  Component I: Transition Assistance and Institution Building ................................... 42 
5.2.2.2.  Component II: Cross-Border Cooperation ................................................................ 43 
5.2.3.  Implementation Modalities and Structures ........................................................... 43 
5.2.4.  Overview of IPA programmes implemented ......................................................... 43 
5.2.4.1.  Component I: Transition Assistance and Institution Building ................................... 43 
5.2.4.2.  Component II: Cross-Border Cooperation ................................................................ 43 
5.2.5.  Participation in Community  Programmes and Agencies ..................................... 44 
5.3. Monitoring and Results.............................................................................................. 44 5.3.1.  Monitoring ................................................................................................................ 44 
5.3.2.  Evaluation results and Lessons Learned ............................................................... 44 
5.3.3.  Sectors with positive results- Success story box .................................................... 44 
6. MONTENEGRO........................................................................................................ 45 6.1. The year in review...................................................................................................... 45  
6.1.1.  Political developments ............................................................................................. 45 
6.1.2.  Macroeconomic developments and structural reforms ........................................ 45 
6.1.3.  Progress in meeting the acquis communautaire .................................................... 45 
6.2. IPA in 2007 ............................................................................................................... . 46 
6.2.1.  MIPD 2007-2009 ....................................................................................................... 46 
6.2.2.  Programming exercise ............................................................................................. 47 
6.2.2.1.  Component I: Transition Assistance and Institution Building ................................... 47 
6.2.2.2.  Component II: Cross-Border Cooperation ................................................................ 48 
EN 6   EN 6.2.3.  Implementation Modalities and Structures ........................................................... 48 
6.2.4.  Overview of IPA programmes implemented ......................................................... 49 
6.2.5.  Participation in Community  Programmes and Agencies ..................................... 49 
6.3. Monitoring and Results.............................................................................................. 49 6.3.1.  Monitoring ................................................................................................................ 49 
6.3.2.  Evaluation results and Lessons Learned ............................................................... 49 
6.3.3.  Sectors with positive results - Success story box ................................................... 49 
7. SERBIA...................................................................................................................... 50 
7.1. The year in review...................................................................................................... 50  
7.1.1.  Political developments ............................................................................................. 50 
7.1.2.  Macroeconomic developments and structural reforms ........................................ 51 
7.1.3.  Progress in meeting the acquis communautaire .................................................... 51 
7.2. IPA in 2007 ............................................................................................................... . 52 
7.2.1.  MIPD 2007-2009 ....................................................................................................... 52 
7.2.2.  Programming exercise ............................................................................................. 52 
7.2.2.1.  Component I: Transition Assistance and Institution Building ................................... 53 
7.2.2.2.  Component II: Cross–Border Cooperation ............................................................... 54 
7.2.3.  Implementation Modalities and Structures ........................................................... 55 
7.2.4.  Overview of IPA programmes implemented ......................................................... 55 
7.2.5.  Participation in Community  Programmes and Agencies ..................................... 55 
7.3. Monitoring and Results.............................................................................................. 55 7.3.1.  Monitoring ................................................................................................................ 55 
7.3.2.  Evaluation results and Lessons Learned ............................................................... 55 
7.3.3.  Sectors with positive results - Success story box ................................................... 56 
8. TURKEY.................................................................................................................... 57  
8.1. The year in review...................................................................................................... 57  
8.1.1.  Political developments ............................................................................................. 57 
8.1.2.  Macroeconomic developments and structural reforms ........................................ 57 
8.1.3.  Progress in meeting the acquis communautaire .................................................... 57 
8.2. IPA in 2007 ...............................................................................................................
. 57 
8.2.1.  MIPD 2007-2009 ....................................................................................................... 57 
EN 7   EN 8.2.2.  Programming exercise ............................................................................................. 58 
8.2.2.1.  Component I: Transition Assistance and Institution Building ................................... 59 
8.2.2.2.  Component II: Cross-Border Cooperation ................................................................ 59 
8.2.2.3.  Components III and IV: Strategic Coherence Framework ........................................ 59 
8.2.2.4.  Component III: Regional Development ..................................................................... 60 
8.2.2.5.  Component IV: Human Resources Development ....................................................... 61 
8.2.2.6.  Component V: Rural Development ............................................................................ 61 
8.2.3.  Implementation Modalities and Structures ........................................................... 61 
8.2.4.  Overview of IPA programmes implemented ......................................................... 63 
8.2.5.  Participation in Community  Programmes and Agencies ..................................... 63 
8.3. Monitoring and Results.............................................................................................. 63 
8.3.1.  State of play for IPA Monitoring Committee and Sectoral Monitoring 
Committees ............................................................................................................... 63 
8.3.1.1.  IPA Monitoring Committee ........................................................................................ 63 
8.3.1.2.  Sectoral Monitoring Committees ............................................................................... 64 
8.3.2.  Evaluation results and Lessons learned ................................................................. 65 
8.3.3.  Sectors with positive results- Success story ........................................................... 65 
PART II: MULTI-BENEFICIARY  AND REGIONAL PROGRAMMES ............................. 66 
9. The year 2007 in review............................................................................................. 66 9.1. Addressing the Political Criteria ................................................................................ 66 9.1.1.  Regional Issues and In ternational Obligations ...................................................... 66 
9.1.1.1.  Regional Cooperation Initiatives ............................................................................... 66 
9.1.1.2.  Public Administration (The Regional Sc hool for Public Administration (ReSPA)) .. 66 
9.1.1.3.  Support to Interim Civilian Administrations .............................................................. 67 
9.1.2.  Civil Society Dialogue and Development ............................................................... 67 
9.2. Addressing the Economic Criteria ............................................................................. 67 
9.2.1.  Tempus, Erasmus Mundus and Youth in Action .................................................. 67 
9.2.2.  International Financing Institutions ...................................................................... 68 
9.3. Ability to assume the obligations of Me mbership and approximation to European 
Standards.................................................................................................................... 68  
9.3.1.  Customs and Taxation ............................................................................................. 68 
EN 8   EN 10. IPA in 2007 ................................................................................................................ 69 
10.1. MIPD 2007-2009 ....................................................................................................... 69 10.2. Programming exercise................................................................................................ 69 10.3. Implementation Modalities and Structures ................................................................ 70 10.4. Overview of IPA programmes implemented ............................................................. 70 10.5. Participation in Community  Programmes and Agencies ........................................... 70 
11. Monitoring and Results.............................................................................................. 70 11.1. Monitoring............................................................................................................... ... 70 
11.2. Evaluation results....................................................................................................... 70 
11.3. Sectors with positive results- Success story............................................................... 70 
PART III: TECHNICAL AND FI NANCIAL ASSISTANCE ................................................ 71 
1. Twinning .................................................................................................................... .......... 71 
2. TAIEX....................................................................................................................... ........... 72 
3. SIGMA....................................................................................................................... .......... 74 
PART IV: FINANCIAL DATA............................................................................................... 76 
1. IPA funds by year........................................................................................................... ...... 76 
2. IPA funds by country 2007 (in euro) ................................................................................... 77 
EN 9   EN PART  I: COUNTRY  SECTION 
1. ALBANIA 
1.1. The year in review  
1.1.1.  Political developments 
In 2007, Albania made some progress on democracy and the rule of law, even though the 
political climate remained overall tense. 
Albania's parliament fulfilled its constitutional role and a new president was elected, but 
political parties' lack of will to co-operate con tinued to hold back reforms, particularly in the 
electoral and judicial fields. Albania made some progress in strengthening its government 
structures to implement its EU commitments a nd to address its development needs. There was  
less turn-over in Albania's public administratio n, but there remained widespread weaknesses 
in human resources management. 
In the field of justice, the procedures for evaluating judges improved, the court system was 
rationalised and the execution of judgeme nts somewhat accelerated. However, the 
performance of the judiciary remained overa ll poor. The government took a more strategic 
approach to the fight against co rruption. Anti-corrupti on investigations led to the arrest of a 
number of high-level officials. Howe ver, corruption remained widespread. 
Regarding human rights and the pr otection of minorities, formal instructions to prosecutors 
and judicial police were passed underlining the need to respect human rights in criminal 
proceedings. Some improvements were made to conditions in detention facilities and most 
pre-trial detainees were transferred to new dedi cated sections in prisons. However, prisons 
remained overcrowded and detention standards poor.  
Albania made some progress on freedom of expression. An action pl an to develop new 
broadcasting legislation was agreed. Steps were  taken to ensure that the public radio and 
television steering committee includes civil society representatives. However, better 
implementation of existing legislation is required. 
Despite a favourable legal framework for civ il society organisations , civil society groups 
remained weak and not sufficiently involved in policy-making. There was some progress on 
strengthening children's and wome n's rights through new legisla tion. Social services improved 
somewhat. Measures to support socially vulne rable people and people with disabilities 
remained limited. As regards property rights, the government adopted a strategy which links 
the processes of initial registra tion of real estate, restitution, compensation and legalisation of 
informally constructed buildings. Better management of restitution and compensation accelerated the processing of claims so mewhat, but it remained overall slow.  
Albania took some measures to fulfil its co mmitments on the protection of minorities but 
further improvement was hindered by the lack of  sound data on the size and situation of 
minorities. The Roma people continued to face difficult living conditions and discrimination. 
EN 10   EN Regarding regional issues and international obligations, Albania continued to foster good 
relations with other Western Balkan and ne ighbouring EU countries, both multilaterally and 
bilaterally. It maintained a constructive position in relation to the Kosovo issue. 
1.1.2.  Macroeconomic developments and structural reforms 
Political consensus on the esse ntials of economic policy was generally maintained in 2007. 
Macroeconomic stability was largely achieved.  Economic growth continued to be strong 
despite energy shortages. Inflation remained low. The level of registered unemployment 
(around 15%) continued to decline. Fiscal reve nue performance was broadly in line with 
targets and budget implementation improved. Public  finance reforms advanced further, but 
fiscal risks remained. In general, the macr oeconomic policy mix was adequate. Following 
significant delays in 2006, privatisation gain ed new momentum in 2007. The privately-owned 
banking sector continued to grow. Credit expansion rema ined strong. The regulatory 
framework for banking supervision is well de veloped. Trade integration with the EU 
remained fairly high. 
However, external deficits widened further, mainly due to difficulties in the energy sector. 
Some progress was made as regards the enforcem ent of court rulings and the establishment of 
property rights, but the shortcomings in the j udicial system and law implementation hindered 
the business climate. While company regi stration procedures started to improve, 
administrative inefficiencies hampered market entry and exit. Some pr ogress was achieved in 
the area of supervising financial actors othe r than banks, but there remains scope for 
strengthening it, in particular regarding th e pension industry. Structural unemployment 
persisted. Shortages of qualified staff and poor in frastructure held back  the development of a 
private sector that should make a sustained contribution to the count ry's development. The 
large informal sector, fuelled by persistent w eaknesses in law enforcement and the regulatory 
framework, reduced the tax base, hampered  the government's capacity to implement 
economic policies and affected nega tively the business environment. 
1.1.3.  Progress in meeting the acquis communautaire 
Albania continued to align its legislati on, policies and capacity with the acquis.  
In the area of the free movement of goods, progr ess in adopting standard s and in accreditation 
was overall good. Capacity for metrology and market survei llance was strengthened, but 
legislative improvements remained pending. On consumer protection some progress has been 
made. The necessary improvements to handle compla ints and to deal with the settlement of 
disputes were not achieved. Uncer tainties related to property rights continued to discourage 
establishment.  
Progress was made on customs co mputerisation. This helped Albania to implement trade-
related provisions of the SAA more effectiv ely. Customs revenue continued to rise. The 
administration of taxation was rationalised and progress was made on co mputerisation and on 
handling of taxpayers' appeals. Howeve r, tax collection remained low.  
The Competition Authority (ACA) was strengthene d. It assessed several merger notifications 
and imposed fines for violation of competition rules. The State Aid Department was given 
independence from the Ministry of Economy as  regards reporting. New public procurement 
legislation, more in line with EU standards, was approved. The Public  Procurement Agency 
was strengthened but its administrative capa city requires further upgrading, even though an 
independent review body in line with the acquis  was still missing. Albania undertook first 
EN 11   EN steps in the area of e-procurement. Regardi ng intellectual property rights (IPR), enforcement 
remained weak.  
In the field of employment and social policie s, the institutional and regulatory framework 
improved with the adoption of a law on labour in spection. However, the capacity of the labour 
inspectorate remained limited and occupationa l health and safety, poor. Budget provisions for 
education were markedly increased. Implemen tation of the national strategies for pre-
university education and vocati onal training started and a ne w law on higher education was 
approved. 
Regarding industry and SMEs, a National Registra tion Centre was estab lished to facilitate 
business registration, and a strategy to promote SME competitiveness was approved. An updated action plan was established to address the informal economy and to remove administrative barriers to investment. Progress on agriculture was limited. Some incentives to 
increase production were introduced, but the competitiveness of the farming sector remained low. Compliance with EU veterinary and phytosan itary standards, required to benefit from 
SAA and Interim Agreement trade concessions, remained poor. Regarding environment, some progress was made on horizontal legisla tion, but implementation remained weak.  
Progress in the field of transport was lim ited. Albania ratified the European Common 
Aviation Area Agreement and started the implemen tation of the first transitional phase. The 
improvements required as regards the safety of maritime transport were not carried out. In the energy sector, Albania was not been able to en sure security of electricity supply. This 
hampered the social and economic developmen t of the country. Considerable efforts are 
required to meet the requirements  of the Energy Community Treaty. 
Market liberalisation in the areas of electr onic communications and information technologies 
remained at an early stage. Regarding financial control, legislation was prepared, but inspection capacity remained weak. Progress was reasonable in the field of statistics. Most 
major statistical classifications are in  place and comply with EU standards. 
In the field of justice, freedom and security progress was made in some areas. An EU-Albania 
visa facilitation agreement was signed. The issu ing of biometric passpo rts in line with EU 
standards and the amendment of the Law on forei gners are issues that remain to be tackled. 
New infrastructure, extension of IT links and better inter-agency and cross-border police co-
operation led to improved border control. An integrated border management strategy was 
adopted. Border crossing point infrastructur e nonetheless remained below EU standards. 
Laws on asylum comply with international standards but implementation remained weak. 
Migration checks at borders were somewhat more  effective, but there is still considerable 
room for improvement.  
The banking system was better used to figh t money laundering; most  public administration 
salaries are now paid through banks. However, concrete results in the fight against money 
laundering remained insufficient. Regarding the fight against drugs, co-operation with foreign 
partners improved and the cons truction of proper storage infr astructure for seized drugs 
started. Significant quantities of  drugs were seized but were still low compared with the 
amounts which are estimated to be trafficked through Albania.  
A new state police law was adopt ed which should help de-politicise the police. The South 
East Europe Police Co-operation Convention, now  ratified, and a strategic agreement with 
Europol provided for intensified internati onal co-operation. Success in investigation and 
EN 12   EN prosecution remained hampered by poor communi cation between police and prosecutors and 
the lack of proactive investigative techniques.  
Organised crime remained a serious problem, even if a number of high-profile organised 
crime arrests were made and police response to serious crim es improved. New tactical and 
investigative equipment was introduced. Co-opera tion with Interpol also improved. However, 
many international arrest requests were not given proper follow up and results in terms of 
actual dismantling organised crime organisations were limited. Efforts remained hampered by corruption and weak witness pr otection. Albania continued to  investigate and prosecute 
trafficking in human beings vigorously, but it remained a significan t transit country. Few 
victims were willing to testify against traffickers, due to w eak witness protection. Poor co-
ordination hampered implementation of the national anti-trafficking strategy.  
Counter-terrorism structures in the police and the intelligence service co-operated better and 
co-operation with international actors was good. However, equipment and training for counter-terrorist analysts and i nvestigators remained insufficient.  Efforts to revise the law on 
protection of personal data started, but legi slation and structured do not meet European 
standards yet. 
1.2. IPA in 2007 
1.2.1.  MIPD 2007-2009  
The Multi-annual Indicative Planning Docume nt (MIPD) 2007-2009 for Albania was adopted 
on 31 May 2007. This strategic docu ment identifies priorities ba sed on the assessment of 
Albania's progress in the implementation of the Stabilisation and Association process. These 
priorities are grouped in three key area s, Political Requirements, Socio-Economic 
Requirements and European standards.  
In the area of political requirements, efforts remain necessary to promote good governance, 
despite the progress of Albania in the conso lidation of the stability of its institutions 
guaranteeing democracy, the rule of law, hu man rights and respect for and protection of 
minorities. 
Albania needs further support to improve the so cio-economic situation of the country and its 
population, particularly improving the business climate, reduce unemployment, better link 
education system with employment and st rengthening the social welfare services. 
Albania must continue its efforts to comply  with the approximation of legislation and 
adoption of EU standards, whereas implemen tation and enforcement should be accelerated 
through the establishment and capac ity building of agencies and in stitutions. Sectoral policies, 
customs, integrated border management a nd migration and asylum policy can also be 
supported. In addition, IPA can prepare the c ountry for decentralised management of EU 
assistance through capacity building of relevant administrative de partments and institutions as 
well as by establishing internal controls and audits. 
EN 13   EN 1.2.2.  Programming exercise 
(in € million, to nearest € 100,000) 
Albania 2007 
I Transition Assistance and Institution Building 54.3
Of which:  National Programme 49.3
Nuclear Safety programme 0.5
Customs Programme 1.8
Tempus and Erasmus Mundus Programmes 2.7
II Cross Border Cooperation 6.7
Of which:  CBC Albania – Greece 0.9
CBC Adriatic programme 3.2
CBC Albania – former Yugoslav Republic of Macedonia 1.1
CBC Albania – Montenegro 0.8
CBC Kukes region programme 0.5
CBC participation in ERDF SE Europe programme 0.2
Programmes for component II  are adopted for three years. Financia l commitments are made annually and 
therefore figures abov e are just for 2007 
1.2.2.1.  Component I: Transition Assistance and Institution Building 
The 2007 IPA component I National Programme for Albania was presented to the IPA 
Management Committee on 27 July 2007 and was adopted by the Commission on 20 
September 2007. The number of projects within this programme was limited to seven, which 
should help to improve implementation rates. In  order to facilitate the management of the 
programme by the EC Delegation, the contrac ting deadline for the 2007 National Programme 
was exceptionally extended to "n + 3" (i nstead of the standard "n + 2").  
The programme supports Albania to comply with  the political criteria through support to the 
police mission PAMECA III and assistance to prepare the acc reditation for decentralised 
management of EU funds. In the economic area, the programme funds support to the SME 
sector through a joint progr amme with the European Bank for Reconstruction and 
Development (EBRD). The2007 National Programme also assists the count ry to align with 
the acquis through projects on statistics alignm ent, water management and support to the 
General Directorate of Tax of Albania.  
EN 14   EN 1.2.2.2.  Component II: Cross-Border Cooperation 
IPA Component II supports the participation of Albania in  two bilateral cross–border 
programmes with neighbouring can didate/potential candidate c ountries: Montenegro and the 
former Yugoslav Republic of Macedonia. With  regards to cross–bo rder cooperation with 
Member States, IPA Component II finances a bilateral programme Al bania–Greece and the 
participation of Albania in the multilatera l cross–border programme "Adriatic", where 
Albania, Bosnia and Herzegovina, Croatia, Mo ntenegro and Serbia cooperate with Greece, 
Italy and Slovenia across the Adriatic Sea. Moreover, IPA Component II also finances a 
unilateral programme con cerning the development of the Ku kes region of Albania, bordering 
Kosovo, as well as the partic ipation of Albania in the ER DF transnational programme 
"South–East Europe". 
All Component II programmes involving Albania,  except those with Member States, were 
presented to the IPA Committ ee on 29/30 October and were adopted by the Commission on 
18/20 December. Although being prepared in  2007, the cross–border programmes with 
Member States (with Greece and the Adriatic) we re adopted in March 2008. To be noted, as a 
condition for its implementation, the CBC progra mme with Greece – which should be put into 
operation according to the tran sitional arrangements referred to in Article 99 of the IPA 
Implementing Regulation No 718/2007 – required a parallel adoption decision covering the 
Greek side of the border (a dopted in September 2008).  
1.2.3.  Implementation Modalities and Structures  
IPA 2007 National Programme: 
The 2007 component I National Programme, with  the exception of one project, will be 
implemented on a centralised basis by the Europ ean Commission in accordance with Article 
53a of the Financial Regulation and the corres ponding provisions of th e Implementing Rules. 
The Implementing Authority is the Delegati on of the European Commission in Albania. 
The project concerning technical assistance to SMEs will be implemented by the European 
Commission in joint management with the EBRD following Article 53d of the Financial 
Regulation and the corresponding provisions of the Implementi ng Rules. To this end, the 
Commission and the EBRD will conclude a Contribution Agreement. 
Albania's participation in hor izontal nuclear safety, custom s and education programmes is 
also funded from its component I envelope . These programmes are not included in the 
component I national programme as they will be  implemented on a multi-country basis and be 
managed centrally by the Europ ean Commission in Brussels.  
Preparation of Decentralis ed Implementation System: 
Regarding preparations for the Decentralised Im plementation System (DIS), Albania aims at 
full DIS accreditation for IPA. It has taken a numb er of initiatives in this respect: The Council 
of Ministers adopted in Septem ber 2007 a decision setting up stru ctures and defining roles for 
DIS. The responsibility for DIS is now with th e Ministry of Finance (MoF) which intends to 
integrate the Programme Management Unit (P MU) of a previous decentralised CARDS 
project into the new Central Finance a nd Contracting Unit (CFCU). The Commission 
provided comments on a draft proposal on role  and structure of the CFCU. The IPA 2007 
National Programme foresees a project to suppor t the country in the DIS process, starting in 
2008.  
EN 15   EN 1.2.4.  Overview of IPA programmes implemented 
In 2007, only the implementation of the proj ect for the police mission PAMECA under the 
Albania National Programme 2007 started. The call for proposals for PAMECA III was 
published, including a suspensive clause, shortly  after the adoption by the Commission of the 
National Programme and was open until 14 January 2008.  
1.2.5.  Participation in Community  Programmes and Agencies 
In 2007, Albania did not participate in Comm unity programmes and Agencies. However, a 
memorandum of understanding was concluded on 17 December 2007 for participation in the 
Research Framework Programme 7 No funds  have been allocated under IPA 2007 for 
participation in Community programmes. 
1.3. Monitoring and Results 
1.3.1.  Monitoring 
No monitoring of IPA projects was carried  out in 2007 as the IPA 2007 programmes were 
only adopted at the end of the year and th e actual implementati on only started in 2008. 
1.3.2.  Evaluation results and Lessons Learned  
So far there are no evaluation results of IP A programmes in 2007 as the implementation only 
started in 2008. For the first year of IPA no  lessons learned can be identified as the 
implementation only started in 2008. 
1.3.3.  Sectors with positive results - Success story box  
For the first year of IPA, no sectors with positive results can be identified as the 
implementation of IPA programmes only started in 2008. 
EN 16   EN 2. BOSNIA  AND HERZEGOVINA   
2.1. The year in review 
2.1.1.  Political developments 
In 2007, Bosnia and Herzegovina's progr ess slowed down. Complex institutional 
arrangements, disregard for the Dayton/Pari s peace agreement and nationalist rhetoric 
undermined the country's reform agenda. Lack of  progress on this and other important issues 
continued to delay the signature of the Stabil isation and Association Agreement (SAA), even 
though some positive developments in November allowed the initialling of the Agreement on 
4 December. 
Bosnia and Herzegovina's system of governance continued to involve si gnificant international 
presence. The Office of the High Representati ve/EU Special Representative (OHR) worked 
closely with the European Commission to brin g Bosnia and Herzegovina closer to the EU. 
However, the authorities of Bosnia and Her zegovina did not demonstrate capacity to take 
further political ownership and responsibility. The Peace Implementation Council decided to 
postpone the closure of OHR. 
Following the elections in October 2006, which we re generally in line with international 
standards, the government of Republika Srpska  was formed in November 2006, but the state-
level government and that of th e Federation of Bosnia and He rzegovina needed more than 
four months to be constituted. Little progress was made in improving state-entity co-ordination, and overall performance of the execu tive and legislative institutions remained 
poor. The prevailing political climate led discu ssions on constitutional reform to a stall. 
The public administration reform co-ordinator's office was strengthened and initial steps were 
taken to implement the public administration reform strategy. An EU supported public administration reform fund was set up. Rega rding the judicial system, Bosnia and 
Herzegovina reduced its dependence on the in ternational community through the replacement 
of international judges and pr osecutors by local ones. Howeve r, the fragmentation of the 
judicial system and disparities in the legal fr amework continued to hamper the operation of 
the judiciary. Bosnia and Herzegovina's co-ope ration with the International Criminal Tribunal 
for the former Yugoslavia (ICTY) improved and reached a generally sa tisfactory level.  
Bosnia and Herzegovina achieved limited progr ess in the fight against corruption. The 
National Anti-Corruption Strategy was not properly implemented.  
As regards human and minority rights, full compatibility of Bosnia and Herzegovina's 
legislation with the European Convention of Human Rights was not achieved, as this is 
dependent on a reform of the Constitution. Shor tcomings remained as regards the prevention 
of ill-treatment by law enforcement bodies, the fi ght against impunity, the prisons system and 
the access to justice and equality before the law.  Religious intolerance remained an issue. In 
the field of freedom of expression and media,  the Federation public broadcasting law was not 
adopted. Bosnia and Herzegovina made progres s in addressing the backlog of human rights-
related cases, but court rulings we re not always properly implemented. 
Overall implementation of legislation protectin g the rights of women, children and socially 
vulnerable people was poor. The complex system of government and the fragmentation of 
EN 17   EN legislation across the country c ontinued to hamper social dialogue. Some progress was made 
as regards the support provided by the authorit ies to civil society de velopment, even though 
the sector remained weak overall. 
Intolerance and ethnic discrimination remained present, and the minorities-related legislation 
was not always properly implemented. Many refugees and internally displaced persons did not benefit from basic pension and health pr ovisions and socio-economic integration of 
returnees remained a problem. The implementati on of the national strategy for the Roma was 
limited and the Roma minority continued to face difficult living conditions and discrimination.  
On the whole Bosnia and Herzegovina's rela tions with its neighbou rs were good, although 
certain strains appeared in particular in relation to the ruling of the International Court of Justice on Bosnia and Herzegovina's lawsuit ag ainst Serbia and Montenegro for genocide. 
Little progress was made in addressing th e outstanding trade and border-related matters. 
2.1.2.  Macroeconomic developments and structural reforms 
In 2007, economic growth remained high and accelerated, while the external balance 
improved. The currency board arrangement continued to underpin macroeconomic stability and inflation receded to the low levels recorded  before the introduction of the VAT in January 
2006. The introduction of VAT increased fiscal revenue. Foreign direct  investment (FDI) 
increased significantly and helped finance the exte rnal deficit. The fina ncial sector developed 
rapidly while price competitiveness was to a large extent preserved. 
However, the overall political climate and weak domestic co nsensus on the fundamentals of 
economic policy led to a slow-down of reforms bot h at entity and other levels of government. 
Despite robust economic growth, unemployment re mained very high. Pub lic spending, and in 
particular social spending, rose significantly, we akening the quality of fiscal adjustment and 
adding to fiscal risks. Significan t structural rigiditi es continued to hamper the functioning of 
the labour market. The restructur ing of state-owned enterprises advanced slowly and progress 
in the liberalisation of network industries was limited. The business environment remained 
affected by significant administrative ine fficiencies, weak enforcement of creditor and 
property rights and sizeable in tervention of the state in th e productive sector. The large 
informal sector hampered the government's capacity to implement economic policies and 
affected negatively the business environment. 
2.1.3.  Progress in meeting the acquis communautaire 
Overall, Bosnia and Herzegovina made limited pr ogress in aligning its le gislation and policies 
with the acquis.  
Preparations in the field of st andardisation, certification and market surveillance advanced, 
though slowly. A lack of conformity assessmen t bodies and procedures continued to hinder 
export capacity. The establishment of a market  surveillance structur e based on appropriate 
product legislation and the phasing out of pre-mark et controls was not carried out. In the area 
of services, right of establishment and comp any law, registering bus inesses and obtaining 
licenses remained burdensome. Banking supervis ion was not brought to the State level and 
remained an Entity responsibility. 
No significant further development took place in  the area of free movement of capital, but 
Bosnia and Herzegovina's prepar ations in this area are on tr ack. Limited additional progress 
EN 18   EN was made in relation to customs rules where, in  particular, rules of or igin, valuation and free 
zones would have needed more attention. As for taxation, VAT collection was higher than 
expected, but no system for the reallocation of the collected revenue to the Entities and the 
Brčko District was agreed.  
Bosnia and Herzegovina is progressing steadily  in the area of anti-trust control. Some 
progress was also been made with regard to state aid through the establishment of a 
preliminary state aid inventory. The Public Pr ocurement Agency and the Procurement Review 
Body saw their operation improved. Little progre ss was made regarding the enforcement of 
intellectual property rights. 
Social and employment legisl ation and policies remained fr agmented. Some progress was 
made in the field of education, notably th rough the adoption of a higher education law 
supporting the participation in the Bologna proc ess. Separation of children in schools along 
ethnic lines remained an issue. 
Little additional progress has b een made towards ensuring the existence of a real internal 
market within Bosnia and Herzegovina. In this context, the State laws  on obligations, leasing 
and pharmaceutical products have not been adopted. 
The industry policy strategy and the SME Development strategy were not adopted. Little 
progress was made in the field of agricu lture. The development of a comprehensive 
agricultural strategy was not ach ieved, although some steps we re taken to establish the 
necessary State-level legal framework. Implem entation of the food safety, veterinary and 
phytosanitary legislation remained poor. In the fi eld of environment, the long expected State-
level environmental law to create the framewor k for a nationwide, harmonised environmental 
protection was not adopted and the stat e environment agency was not set up. 
Sustained, albeit slow, progres s continued regarding Bosnia and Herzegovina’s involvement 
in developing the trans-European transport ne twork. Bosnia and Herzegovina advanced in the 
implementation of the first transitional phase the European Common Aviation Area 
Agreement (ECAA).  
In the electricity sector, tran smission was unbundled. Reforms in th e gas sector saw particular 
delays. A country-wide energy strategy remained pending. The requirements of the Energy Community Treaty were  only partly met. 
As regards information society and media, some  progress was made in terms of liberalisation 
of the telecommunication sector and approximati on of audiovisual legislation with the acquis 
by the Communications Regulatory Agency. In the field of statistics, the co-operation 
agreement between the country's statistics in stitutions at State and Entity level was not 
properly implemented.  
In the area of justice, freedom and security, the lifting of visa requireme nts for all EU citizens 
was confirmed and the readmission and visa fac ilitation agreements at EU-level were signed. 
Further progress was in the areas of asylum and migration. As regards the fight of money 
laundering, the staff of the Financial Intelligen ce Unit increased and so me progress was made. 
An office for the prevention of the abuse of narcotics was esta blished, but a State-level drug 
policy in line with EU standa rds remains to be developed. 
Implementation of tools such as computer-based investigations, criminal analysis systems and 
forensics contributed to the wo rk of the police. A strategic agreement with Europol was 
EN 19   EN concluded. However, little progress was made to  implement the overall police reform aiming 
at unifying police forces in the country. 
There is still room for improvement in fighting organised crime. The 2005-2007 national 
action plan for combating trafficking in hum an beings was implemented, but no follow-up 
strategy was not ready by the end of 2007. Inc onsistencies between state- and entity-level 
legislation continued to hinder prosecution of  serious crimes. Bosnia and Herzegovina's 
resources to counter terrorism remained insuffici ent. The State agency for data protection was 
not established. 
2.2. IPA in 2007 
2.2.1.  MIPD 2007-2009 
The Multi-annual Indicative Planning Document (MIPD) 2007-2009 for Bosnia and 
Herzegovina was adopted on 1 June 2007.  
The MIPD identifies a continuing and considerab le challenge for Bosnia and Herzegovina to 
comply with the political requirements of th e Stabilisation and Associ ation Process (SAp) by 
increasing the effectiveness of the executiv e and legislative bodies, improving the co-
ordination between State and Entities and to ag ree on the reform of its police structure. IPA 
can assist in the strengthening of administ rative capacity, can support domestic efforts on 
constitutional reform, and can assist in the reform of the police and the judicial system. 
Substantial political risks relate to this core  reform areas and resistance of key political 
stakeholders may impede the success of the re forms. The Commission considers those risks in 
the programming of its assistan ce. To support the fulfilment of the political requirements, the 
MIPD places further emphasis on civil societ y and the development of independent and 
professional media. IPA can further assist in the fight against corrup tion and support Bosnia 
and Herzegovina to improve the situation of  returnees, minorities and vulnerable groups. 
Several economic indicators raise concerns , among which the high unemployment rates and 
external imbalances. In addition, slippages in p ublic spending create ob stacles to social and 
economic recovery. To assist the country to comply with the economic requirements of the 
SAp, IPA can support stabilising the macro-eco nomic environment and improving the quality 
of public spending to create a favourable busine ss climate. In addition, the reform of the 
education system and of the labour market sha ll contribute to foster employment. Further 
sectors supported under the ec onomic requirements are trade,  health, SME and regional 
development. 
Bosnia and Herzegovina made so far only li mited progress in the approximation of its 
legislation and policies with the acquis. To a ssist the country to comply with the acquis 
related requirements of the SA p, IPA can support the development and the implementation of 
strategies and policies to approximate to the European acquis in the areas of internal market, sectoral policies and justice, freedom and secu rity. The emphasis of the assistance is placed 
on agriculture and rural development, transp ort and energy. Examples  of further supported 
sectors are environment, quality in frastructure, customs and taxation.  
The focus of the assistance in the Cross-Bord er Cooperation component is on the support of 
Bosnia and Herzegovina's participation in the cooperation with its neighbour countries 
Croatia, Montenegro and Serbia , on its participation in th e Adriatic IPA cross-border 
programme with Member States and on its participation in the ERDF transnational 
programmes "South East Europe " and "Mediterranean ". 
EN 20   EN 2.2.2.  Programming exercise 
(in € million, to nearest € 100,000) 
BOSNIA AND HERZEGOVINA 2007 
I Transition Assistance and Institution Building 58.1
Of which:  National Programme  49.7
Nuclear Safety programme 0.5
Customs Programme 4.5
Tempus and Erasmus Mundus Programmes 3.4
II Cross Border Cooperation 4.0
Of which:  CBC Adriatic programme  1.3
CBC Bosnia & Herzegovina and Croatia 1.0
CBC Bosnia & Herzegovina and Serbia 0.7
CBC Bosnia & Herzegovina and Montenegro 0.5
CBC participation in ERDF SE Europe programme 0.5
Programmes for components II, III, IV and V are adopted for three years. Financial commitments are made 
annually and therefore figure s above are just for 2007 
2.2.2.1.  Component I: Transition Assistance and Institution Building 
The IPA 2007 National Programme  for Bosnia and Herzegovina was presented to the IPA 
Management Committee in September 2007 and was adopted by the Commission on 20 
December 2007. 
The programme assists Bosnia an d Herzegovina to comply with the political requirements of 
the Copenhagen criteria by supportin g the social inclusion and retu rn, the rule of law, and the 
public administration and constitution refo rm. The socio-economic requirements are 
supported by assistance to labour and economic de velopment, and to h ealth and education. 
IPA assists to approximate to the acquis by  supporting the establishment of regulatory 
systems in the financial sector, justice and hom e affairs, an improved quality infrastructure, 
energy and telecommunication as well statistics and information systems. The IPA National Programme further assists the c ountry by supporting activ ities in the field of agriculture and 
rural development, environment and transport. 
2.2.2.2.  Component II: Cross-Border Cooperation 
IPA Component II supports the pa rticipation of Bosnia and He rzegovina in three bilateral 
cross–border programmes with Croatia, Mont enegro and Serbia. Concerning CBC with 
Member States, IPA Component II finances the participation of Bosnia  and Herzegovina in 
the IPA CBC Adriatic programme. Finally, in 2007 the IPA Component II finances the participation of Bosnia and Herzegovina in the ERDF transnational programme "South-East 
Europe". The 2007 Component II programmes i nvolving Bosnia and Herzegovina were 
EN 21   EN adopted in December 2007, except the IPA Adri atic programme, which was prepared in 2007 
but adopted in March 2008. 
2.2.3.  Implementation Modalities and Structures  
IPA 2007 National Programme: 
The programme will be implemented on a centr alized basis by the European Commission, EC 
Delegation to Bosnia and Herzegovina, in acc ordance with Article 53a of the Financial 
Regulation and the corresponding provisi ons of the Implementing Rules. 
Bosnia and Herzegovina's partic ipation in horizontal  nuclear safety, customs and education 
programmes is also funded from its compon ent I envelope. These programmes are not 
included in the component I national progra mme as they will be implemented on a multi-
country basis and be managed centrally by the European Commission in Brussels.  
Preparation of Decentralis ed Implementation System: 
The Director of the Directorate for European Integration remains the National Aid 
Coordinator (NAC) for previous EU assist ance and is also acting as National IPA 
Coordinator. In 2007, no significant progress was made to prepare for DIS. The recruitment of 
staff for key positions in the National Fund an d the future Operating Structure within the 
Ministry of Finance and Treasury started in  June 2006 but was postponed in March 2007 due 
to a lack of office space despite the fact that  the work of a Techni cal Assistance team to 
support the Ministry had alrea dy started. Recruitment was re-launched in May 2007 but only 
50% of staff have been recruited and begun to receive training. Th e Council of Ministers 
appointed a National Authoris ing Officer (NAO) and the h ead of the National Fund. The 
Directorate for European Integration is prep aring a DIS Strategy aiming for accreditation by 
February 2009. 
2.2.4.  Overview of IPA programmes implemented  
In 2007, no IPA programmes were implemented in Bosnia and Herzegovina.  
2.2.5.  Participation in Community  Programmes and Agencies 
Bosnia and Herzegovina did not yet participat e in any Community Programmes or Agencies 
in 2007. No funds have been allocated under  IPA 2007 for participation in Community 
programmes. 
2.3. Monitoring and Results 
2.3.1.  Monitoring 
No monitoring of IPA projects was carried  out in 2007 as the IPA 2007 programmes were 
only adopted at the end of the year and th e actual implementati on only started in 2008. 
2.3.2.  Evaluation results and Lessons Learned  
So far, there are no evaluation results of IP A programmes in 2007 as the implementation only 
started in 2008. For the first year of IPA no  lessons learned can be identified as the 
implementation only started in 2008. 
EN 22   EN 2.3.3.  Sectors with positive results - Success story box  
For the first year of IPA, no sectors with positive results can be identified as the 
implementation of IPA programmes only started in 2008. 
EN 23   EN 3. CROATIA 
3.1. The year in review 
3.1.1.  Political developments 
EU accession negotiations began with Croatia on 3 October 2005 and are progressing well.  
Implementation of strategies for reformi ng the judiciary and fighting corruption has 
continued. The case backlog before the courts  has been reduced. Some first results are 
appearing in the fight against corruption. Croatia has taken furt her steps to address problems 
of minorities and, to a lesser extent, refugee return. Full cooperation with ICTY has 
continued. Croatia ratified the new Central Eu ropean Free Trade Agreement (CEFTA), and 
has continued to participate ac tively in regional cooperation, for example in the establishment 
of the new Regional Cooperation Council.  
However, considerable challenges remain in ke y areas, such as reform of the inefficient 
judicial system, public administration refo rm and fighting corruption, which remains 
widespread. Increased attention needs to be paid  to minority rights, especially refugee return. 
The prosecution of war crimes requires further a ttention. Further regional cooperation is vital, 
as are efforts to solve outsta nding bilateral problems with neighbours, especially on border 
delimitation.  
3.1.2.  Macroeconomic developments and structural reforms 
Economic growth has increased and macroeconomic stability was maintained. The general 
government deficit was reduced significantly. In flation remained low. Private investment 
picked up further. Employment rose and the bus iness environment improved. The stability of 
the financial sector increased. The governme nt's economic policy capacity was further 
strengthened. 
However, rising external imbalances can beco me a risk. Structural reforms, including the 
restructuring of the shipbuilding and steel  sectors moved forward only slowly. State 
intervention in the economy remained significant. Inefficiencies in public administration and 
the judiciary continued to hamper private sector  development. The extern al debt has not been 
reduced, highlighting the need for tighter fiscal policies.  
3.1.3.  Progress in meeting the acquis communautaire 
Croatia has improved its ability to take on the ob ligations of EU membership. Preparations for 
meeting EU requirements are moving forward at a steady pace and alignment with EU rules is 
high in some sectors. However, significant effo rts lie ahead in order to reach full alignment. 
In most areas there has been some progress, pr incipally in terms of legislative alignment but 
also as regards administrative capacity buildi ng. In some chapters such as transport and 
environment, good progress made in previous years has been sustained. However, further 
efforts are needed regarding the implementation of  the first transitional phase of the European 
Common Aviation Area Agreement (ECAA). In ot her chapters such as public procurement 
and taxation, progress has remained limited. As regards the overall level of alignment and administrative capacity, much remains to be done. 
EN 24   EN 3.2. IPA in 2007 
3.2.1.  MIPD 2007-2009 
The Multi-annual Indicative Planning Docume nt (MIPD) 2007-2009 for Croatia was adopted 
on 20 June 2007. It is base d on an indicative financial envelope of €438.4 million  for the 
period 2007-2009. 
The overall objective of the pre- accession assistance provided to Croatia under IPA is to assist 
the country in meeting the accession criteria , i.e. the political  and economic  criteria, as well 
as the adoption, implementation and enforcement of the acquis communautaire. In addition, 
IPA assistance aims to support policy development as well as preparation for the implementation of the Community's common agricultural policy and the cohesion policy  
with a view to EU membership.  
Pre-accession assistance for Croatia under IPA will be implemented according to the five IPA 
components  available to Candidate Countries.  
Under Component I , pre-accession assistance to Croa tia will inter alia support public 
administration reform, judicial reform, and anti -corruption policy. Assistance will also focus 
on structural reforms in public finance, eco nomic restructuring, business environment, 
statistics, land reform and labour market reform.  
In addition, pre-accession assistance will s upport institutional capacity building for acquis 
transposition and implementation according to the priorities identified in the Accession Partnership, the screening reports and subsequent negotiations in the different chapters of the 
acquis. Finally, capac ity building can al so be provided for the mana gement of IPA projects 
and to re-enforce institutional capacity for the management of EU Structural Funds upon 
accession. Croatia’s participation in Community Programmes will also continue to receive 
financial support under Component I.  
Assistance to Cross-border Cooperation  (CBC) provided under Component II  aims at 
improving co-operation and good neighbourly relati ons of Croatian border regions with the 
neighbouring border areas and familiarising Croatia  with the rules and procedures governing 
the European Territorial Cooperation objectiv e under Structural Funds . The MIPD foresees 
continuing CBC with Slovenia, Hungary and It aly and developing bilateral CBC programmes 
with Bosnia and Herzegovina, Montenegro, and Serbia.  
Components III  and IV aim at supporting Croatia in policy development as well as 
preparation for the implementation and management of the Community’s cohesion policy , in 
particular regarding the European Regional Development Fund, the Cohesion Fund and the 
European Social Fund. In terms of pre-acces sion assistance under Components III and IV, 
priorities comprise acquis- related investment in environmental protection and the 
development of a European transport network to gether with support to the productive sector, 
in particular to SMEs; Component IV  priorities encompass investment in employment, 
education, social inclusion and human capital formation. 
Component V  aims at supporting Croatia in policy de velopment as well as preparation for 
the implementation and management of the Community’s common agricultural policy . 
Assistance under Component V will target three main priority axes. The first will provide 
assistance to the adaptation of  the agricultural sector and th e implementation of the acquis 
EN 25   EN communautaire concerning the common agricultur al policy. The second aims at preparing 
Croatia for the implementation of agri-environme ntal measures and the third at sustainable 
development of rural areas. 
Coherence and concentration of assistance will  be necessary for the effectiveness of IPA 
assistance under all components. Where appropriate, effectiv e coordination and 
complementarity with other IPA components will be ensured. 
3.2.2.  Programming exercise 
(in € million, to the nearest € 100,000) 
CROATIA 2007 
I Transition Assistance and Institution Building 49.6
Of which:  National Programme  45.4
Nuclear Safety programme 0.5
Tempus and Erasmus Mundus Programmes 3.7
II Cross Border Cooperation 9.7
Of which:  CBC Croatia and Hungary  1.4
CBC Croatia and Slovenia 1.7
CBC Adriatic Programme 3.9
CBC Croatia and Serbia 0.8
CBC Croatia and Bosnia & Herzegovina 1.0
CBC Croatia and Montenegro 0.4
CBC participation in ERDF SE Europe and ERDF Mediterranean programmes 0.5
III Regional Development  45.1
Of which:  
 Regional Competitiveness Programme  11.1
Transportation Programme 17.0
Environmental Programme 17.0
IV Human Resources Development 11.4
V Rural Development  25.5
Programmes for components II, III, IV and V are adopted for three years. Financial commitments are made 
annually and therefore figure s above are just for 2007 
EN 26   EN 3.2.2.1.  Component I: Transition Assistance and Institution Building 
The IPA 2007 National Programme for Croati a was adopted on 20 December 2007 with an 
IPA contribution of € 45.4 million.  
Under the political criteria  heading of the MIPD, the IP A 2007 National Programme will 
address the fight against corruption through pr oject "Strengthening Capacities of USKOK" 
and project "Improving Anti-Co rruption Inter-Agency Cooperati on". The project "Capacity 
Building for Personal Data Protection" will cont ribute to progress in the area of human rights 
and the protection of minorities.  
Under the economic criteria , the IPA 2007 National Programme will contribute to improve 
the business environment thr ough the project "Developme nt of Regulatory Impact 
Assessment".  
The IPA 2007 projects in the area of ability to assume the obli gations of membership will 
focus on institutional and administrative capacity building for acquis transposition and implementation in the following chapters: Competition Policy – "Implementing Croatian Competition and State Aid Policies"; Informati on Society and Media – "Reinforcement of 
Croatian Telecommunications Agency"; Agri culture – "Management and Control of 
Agricultural Funds"; Energy – "Energy Administ rative Data Management"; Social Policy and 
Employment – "Health and Safety at Work"; Justice, Freedom and Security – "National 
Border Management Information System – Ph ase III" and "Combating Drug Trafficking and 
Abuse"; Environment – "Chemical Safety";  Customs Union – "Customs Laboratory 
Development" and "Equipment for Anti-smuggling Units". 
Supporting programmes  under IPA 2007 will continue to provide for administrative 
capacity building for strategy development, project preparation and implementation, 
institution building support and SAA and acquis implementation through a "Technical 
Assistance Facility". Capacity building under this project may also be provided for the 
management of IPA projects and to reinforce in stitutional capacity for the management of EU 
structural funds. Under the same MIPD heading, IPA 2007 will support "Preparatory 
measures for participation in the Lifel ong Learning and Youth in  Action programmes". 
"Participation in Community Programmes and Agencies" will also continue to receive 
financial support under IPA 2007.  
3.2.2.2.  Component II: Cross-Border Cooperation 
Under Component II, Croatia participates in  three multi-annual cross-border programmes 
(CBC) with neighbouring IPA countries: CB C Croatia-Bosnia and Herzegovina, CBC 
Croatia-Montenegro and CBC Croatia-Serbia adopted respectively on 10 December 2007, 12 
December 2007, and 20 December 2007.  
These cross-border cooperation programmes aim at reconciliation, encouraging the creation of 
cross-border networks and partnerships and deve loping joint cross-border  actions with a view 
to revitalizing the economy, prot ecting the nature and the envi ronment and increasing social 
cohesion in the programming area. They also include technical assistance. 
A programme financing the participation of Cr oatia in the ERDF European Territorial Co-
operation transnational programmes "South-East  Europe" and "Mediterranean" was also 
funded under the IPA Cross-border Co-operati on component for 2007 and adopted on 12 
December 2007. 
EN 27   EN In 2007, the following cross-border programmes between Croatia and Member States were 
also prepared: CBC Adriatic, CBC Hunga ry-Croatia, and CBC Slovenia-Croatia1.Components 
III and IV: Strategic Coherence Framework 
In accordance with the provisions of the Artic le 154 of the Commissi on Regulation (EC) n° 
718/2007 Croatia has established the Strate gic Coherence Framework (SCF) for 2007-2013 
covering IPA Components III (Regional Development) and IV (Human Resources 
Development). 
Within the Strategic Coherence Framework the supporting socio-economic analysis and 
subsequent strategy identified the key objecti ves and priorities implemented through four 
multi-annual Operational Programmes (three in component III and one in component IV) with 
a strong strategic focus. IPA with, its simila rities to the European Regional Development 
Fund and Cohesion fund, is a precursor of Structur al Funds. The SCF is also considered as 
"mini NSRF".  
The preparation of the SCF in Croatia has been  coordinated by the Strategic Coordinator who 
consulted the Commission throughout the whole process. The Commissi on services verified 
the content of the SCF and concluded that it cont ains all the relevant elements. Subsequently 
on 18 June 2007 the Commission's position on th e SCF was transmitted to the national 
authorities in the form of a letter ad dressed to the Strategic coordinator. 
3.2.2.3.  Component III: Regional Development 
Three multi-annual operational programme s were adopted in 2007: "Regional 
Competitiveness OP" adopted on 29 November  2007, "Transport OP" adopted on 7 December 
2007 and "Environment OP" adopted 29 Novemb er 2007. The IPA resources allocated to 
each programme are:  
Component III programmes  2007 2008 2009 Total 
Regional Competitiveness 11,050,250 11,600,000 12,699,500 35,349,750 
Transport 17,000,250 18,000,000 18,500,250 53,500,500 
Environmental Protection 16,999,500 18,000,000 18,500,250 53,499,750 
In component III one of the fundamental prin ciples of Cohesion poli cy has been applied. 
Concentration (thematic and geographical) of the assistance on limited number of strategic 
priorities and on disadvantaged areas (in Regional Competitiveness OP) will maximise the development impact of the IPA intervention 
The strategy under component III foresees  concentration of resources in the transport  
(Transport OP) and environment  (Environment OP) and regional competitiveness  (Regional 
Competitiveness OP) sectors. It covers acquis-re lated investments in environmental protection 
(waste water, drinking water and waste manage ment) and sustainable transport (railways and 
inland waterways). Along with these efforts directed  at basic infrastructure, further assistance 
                                                
 
1 They were adopted in 2008 (25 March 2008 for CBC Adriatic, 13 March 2008 for CBC Hungary-
Croatia, and 27 February 2008 for CBC Slovenia-Croatia). 
EN 28   EN is aimed at modernising and restructuring the productive capacity of di sadvantaged regions in 
particular by providing services to enterpri ses, particularly small and medium sized.  
Moreover, under the three Operational Programme s resources will be utilised to introduce into 
the national framework the strategic planni ng and management principles guiding the 
implementation of EU structural instrument s, also via learning by doing process.  
Within each of the OP a separa te priority on Technical Assi stance has been introduced to 
support the national structures managing IPA as well as ensuri ng project prepar ation of high 
standards. A comprehensive in stitutional set up (Operating St ructure consisting of a few 
bodies specific for each OP/priority) built for IP A will continue with some modifications 
under Structural funds regime. 
In the course of 2007, the Croatian authorities ca rried out the maturity of several projects in 
the filed of solid and waste water including th e transport sector. Be sides, the Commission 
officials in close cooperation with the Croa tian authorities underto ok pre-appraisal site 
missions. The ultimate goal was to ensure an ade quate quality project pipeline. In fact, in 
December 2007, the HR authorities submitted their first solid waste major project application.  
3.2.2.4.  Component IV: Human Resources Development 
A multi-annual operational programme "Human  Resources Development" under Component 
IV for Croatia was adopted on 7 December 2007 a nd consists of 4 priority axes: "Enhancing 
access to employment and sustainable inclusion in the labour market", "Reinforcing social 
inclusion of people at a disadvantage", "Enha ncing human capital and employability", and 
Technical Assistance. 
Component IV  2007 2008 2009 Total 
Human Resources Development 11.4 12.7 14.2 38.3 
3.2.2.5.  Component V: Rural Development 
A multi-annual "Programme for agriculture and rural development" under Component V for 
Croatia was prepared in 20072 and consists of 3 priority ax es: "Improving market efficiency 
and implementation of Community standards", "Preparatory actio ns for implementation of the 
agri-environmental measures and local rural de velopment strategies", and "Development of 
the rural economy". 
Component V 2007 2008 2009 Total 
Rural Development 25.5 25.6 25.8 76.9 
3.2.3.  Implementation Modalities and Structures  
As regards previous EC financial instruments (CARDS and Phare), decentralised management 
powers with ex-ante control we re conferred to Croatia by the Commission in February 2006.  
                                                 
2 The programme was adopted by the Commission on 25 February 2008. 
EN 29   EN The EC and the Government of the Republic of  Croatia signed the Framework Agreement on 
the rules for co-operation concerning EC fina ncial assistance to Croatia under IPA on 27 
August 2007. By the end of 2007, the authorities of  Croatia had not yet submitted a request to 
the Commission for decentralised manageme nt of IPA funds with ex-ante control.3 
Croatia's participation in horizontal nuclear sa fety and education programmes is also funded 
from its component I envelope. These progr ammes are not included in the component I 
national programme as they will be implemen ted on a multi-country basis and be managed 
centrally by the European Commission in Brussels. 
3.2.4.  Overview of IPA programmes implemented 
No IPA programmes were implemented in 20 07, as the first IPA programmes were only 
adopted at the end of 2007. 
3.2.5.  Participation in Community  Programmes and Agencies 
€4.6 million are allocated from IPA 2007 Component  I to co-finance the participation of 
Croatia in, inter alia, the follo wing indicative list of Community  Programmes and Agencies in 
2008 or 2009: CUSTOMS 2013, Fiscalis 2013, I DAbc, Seventh Framework Programme for 
Research, Technological Developmen t and Demonstration Activities, Community Programme 
for Employment and Social Solidarity - PROGRESS , MEDIA 2007, Competitiveness and 
Innovation Framework Programme (CIP), Culture  Programme, Civil Pr otection Financial 
Instrument, Europe for Citizen s, Programme of Community Action in the Field of Health, 
European Monitoring Centre for Drugs and Drug Addiction. 
In addition, IPA 2007 Component I for Croatia provided €857,775 of IPA funding for 
preparatory measures for participation in  the Lifelong Learning and Youth in Action 
programmes. Participation in these programmes is conditional on the fulfilment by the candidate countries of requirements concerning th e capacity of national structures – called the 
National Agency – to ensure sound financial management of the programmes without ex-ante control of the Commission.  
3.3. Monitoring and Results 
3.3.1.  State of play for IPA Monitoring Co mmittee and Sectoral Monitoring 
Committees 
Programme implementation under IPA in Croa tia shall be monitored through the IPA 
monitoring committee assisted for each compon ent by Sectoral Monitoring Committees. Each 
committee shall satisfy itself as to the effectiveness and quality of the implementation of the programmes and operations. They may make pr oposals to the Commission and the national 
IPA co-ordinator, with a copy to the national authorising officer, for decisions on any 
corrective measures to ensure the achieveme nts of programme objec tives and enhance the 
efficiency of the assistance provided. 
                                                
 
3 In 2008, Croatia submitted a request to the Commission for decentralised management of IPA funds 
with ex-ante control. It is only if the operating structures are deemed ade quate that the Commission will 
initiate the process of conferral of management po wers. The conferral of management mission carried 
out by the Commission in May 2008 concluded with a formal opinion on the preparedness of the 
bodies/authorities responsible for the programmes  and the Commission has initiated the process of 
conferral of management powers. 
EN 30   EN No formal committee took place in 2007, as the first IPA programmes were only adopted at 
the end of 2007 and implementation had not yet started.4 
However, in December 2007, three Shadow Se ctoral Monitoring Committees took place for 
the Operational Programmes of Transport, Regional Competitiveness and environment. These meetings allowed to elaborate a number of issues relating to the rules of the procedure internal 
functioning of the committees. Advice and counselling was prov ided by the Commission in 
preparing a Strategic Work Plan including an  action-oriented Technical Assistance plan. 
Besides, in 2007 a number of missions took place to advance and conclude the preparation of 
actions needed to pave the way for the progr ammes implementation. The Sectoral Monitoring 
Committee for the OP Human resources developmen t also met for the first time in December 
2007. Additionally; the first informal Sect oral Monitoring Committee for the rural 
development programme took place in November 2007.  
3.3.2.  Annual and final reports on implementation  
No IPA report on implementation was submitted by the national authorities in 2007, as the 
first IPA programmes were only adopted at th e end of 2007 and implementation had not yet 
started. 
The first sectoral annual reports shall be subm itted by the Operating Structures to the national 
IPA co-ordinator, the national authorising offi cer and to the Commission, after examination 
by the aforementioned sectoral monitoring committees and for the first time in 2008.
5 
On the basis of these reports, the national IPA co-ordinator sh all send the IPA annual report 
on implementation, covering all IPA component s, to the Commissi on and the national 
authorising officer, after exam ination by the IPA Monitoring Committee and for the first time 
in 2008. 
3.3.3.  Evaluation results and Lessons learned  
During 2007 multi-annual operational programmes unde r components III and IV were subject 
to ex-ante evaluations carried  out in accordance with Structural F unds guidelines and 
requirements, forming an integrant part of th e process for the adoption of the programmes.  
An ex-ante evaluation was carri ed-out by independent expert s for the Rural Development 
programme. The conclusions/recommendations of this  report were taken into consideration in 
preparing the final vers ion of that programme.. 
No additional IPA evaluations were carried out in 2007, as the first IPA programmes were 
only adopted at the end of 2007 and implementation had not yet started. 
3.3.4.  Sectors with positive results- Success story  
No IPA programmes were implemented in 20 07, as the first IPA programmes were only 
adopted at the end of 2007. 
                                                 
4 The first Sectoral Monitoring Co mmittees are scheduled to take place in May or June 2008, to be 
followed by the first IPA Monito ring Committee in July 2008. 
5 The exceptions are Component II, where the first sectoral annual reports shall be submitted in 2008, and 
Component V, where the first sectoral annual report shall be submitted within six months of the end of 
each full calendar year of programme implementation. 
EN 31   EN 
EN 32   EN 4. FORMER  YUGOSLAV  REPUBLIC  OF MACEDONIA 
4.1. The year in review 
4.1.1.  Political developments 
The former Yugoslav Republic of Macedonia ma de progress in addressing the Copenhagen 
political criteria.  During 2007 frequent tension and pr oblems in achieving constructive 
dialogue between major political actors undermined  the effective functio ning of the political 
institutions and led to a slowdown in reform s. However, following the publication of the 
Commission's critical Progre ss Report in November 2007 some significant further reforms 
were adopted concerning the judiciary, reform  of the police, and inter-ethnic relations. 
4.1.2.  Macroeconomic developments and structural reforms 
There has been further progress towards establ ishing a functioning market economy. It should 
be able to cope with competitive pressures and market forces within the Union in the medium 
term, provided that it vigorously implements its  comprehensive reform programme in order to 
reduce significant structural weaknesses. 
4.1.3.  Progress in meeting the acquis communautaire 
The former Yugoslav Republic of Macedonia has made  further efforts to improve its ability to 
assume the obligations of membership. There was some progress in the fulfilment of the short term priorities of the European partnership. The country still faces major shortcomings in implementing and effectively enforcing legislat ion. Adequate human an d financial resources 
to fully implement the SAA are lacking. Large scale replacement of qua lified staff following 
political changes hampered efforts to impr ove administrative capacity. Some progress has 
been made in the implementation of the firs t transitional phase of the European Common 
Aviation Area Agreement (ECAA).  
4.2. IPA in 2007 
4.2.1.  MIPD 2007-2009 
Based on the assessment of strategic needs and pr iorities set out in se ction 1 the pre-accession 
assistance strategy for the period 2007-2009 is co ncentrated on four areas of activity: 
1. Support Institution Building 2. Improve cross-border cooperation 3. Prepare the beneficiary for participation in the Community's c ohesion policy and rural 
development instruments 
4. Prepare for decentralised management of EU funds 
EN 33   EN 4.2.2.  Programming exercise 
(in € million, to the nearest € 100,000) 
Former Yugoslav Republic of Macedonia 2007 
I Transition Assistance and Institution Building 41.6
Of which:  National Programme Part I  12.0
National Programme Part II  22.9
Nuclear Safety programme 0.5
Customs programme 0.5
Tempus and Erasmus Mundus Programmes 5.7
II Cross Border Cooperation 4.2
Of which:  CBC former Yugoslav Republic of 
Macedonia and Bulgaria  0.7
CBC former Yugoslav Republic of Macedonia and Greece 0.8
CBC former Yugoslav Republic of Macedonia and Albania 2.2
CBC participation in ERDF SE Europe programme 0.5
III Regional Development  7.4
Of which:  Transport Priority  5.6
Environment Priority 1.4
Technical Assistance Priority  0.4
IV Human Resources Development 3.2
V Rural Development  2.1
Programmes for components II, III, IV and V are adopted for three years. Financial commitments are made 
annually and therefore figure s above are just for 2007 
4.2.2.1.  Component I: Transition Assistance and Institution Building 
Due to the urgent need to continue the suppor t to the Police Reform which had started under 
the CARDS programme, it was decided to sp lit the 2007 component I National Programme 
into two parts.  
The first part (€ 12 million) contained project s linked to the Police Reform and a Project 
Preparation Facility. The rele vant Financing Agreement with the former Yugoslav Republic 
of Macedonia was signed on 30 October 2007. 
Part II of the national programme (€ 22.94 m illion) was adopted by the Commission on 16 
November 2007; Signature of the Financing Agreement took place end of May 2008. This 
EN 34   EN second part aims at supporting the implementa tion of the Public Administration Reform 
Strategy, the Judicial Reform as well as capacity building for decentralised management of EU funds. Under Socio-economic Requirements the programme will assist municipalities 
with building the essential infrastructure to support both social and economic development As 
regards Acquis related activities substantial support will be given to the tax administration to the statistical office and customs. Additionally  the programme supports the participation of 
the country in certain Community Programmes 
The Framework Agreement between the Euro pean Commission and the former Yugoslav 
Republic of Macedonia, which gives the legal and financial framework for the 
implementation of all IPA programmes be tween 2007 and 2013, was also signed on 30 
October 2007. The necessary ratification by the Parliament took place on 30 January 2008. 
4.2.2.2.  Component II: Cross-Border Cooperation 
With the support of IPA Component II, in 2007 the former Yugoslav Republic of Macedonia 
participate in a bilateral programme with Al bania and in two bilateral programmes with 
neighbouring Member States Bulgaria and Greece. IPA Component II also finance the 
participation of the former Yugoslav Republ ic of Macedonia in the ERDF European 
Territorial Co-operation transnationa l programme "South-East Europe". 
4.2.2.3.  Components III and IV: Strategic Coherence Framework 
As required by Article 154 of Commission Regulation (EC) N° 718/2007, the Former 
Yugoslav Republic of Macedonia prepared a Strategic Coherence Framework (SCF) for the period 2007-2013, covering IPA components III a nd IV. Its purpose is to set the overall 
strategic framework for programming of resources in the context of the national priorities for 
social and economic developmen t and Community priorities fo r cohesion, thus constituting a 
key reference document for programming IPA regional development and human resources 
development components. The SCF is a key docum ent to introduce structural funds strategic 
planning to candidate countries (a "mini NSRF"), reinforcing the role of IPA assistance under 
components III and IV as a precursor to structural funds. 
The preparation of the Strate gic Coherence Framework was coordinated by the Strategic 
Coordinator for IPA regional development a nd human resources development components. 
Throughout its preparation extensive coordina tion has taken place within the national 
administration, particularly the line ministries who will be involved in the implementation of 
components III and IV programmes. Once finalis ed, it was transmitted to the Commission for 
information and verification of consistency with  the requirements of the regulation, but the 
Strategic Reference Framework remains a national document.  
Over the period 2007-2013, assistance under Compone nt III will be rebalanced from transport 
sector to environment sector. The percentage of  resources allocated to the environment sector 
will be progressively aligned with other candida te countries, in line with the needs of the 
country, the development of adequate strategies  and investment planning and the capacity to 
prepare and implement infrastructure i nvestments in the environment sector. 
4.2.2.4.  Component III: Regional Development 
The multi-annual Operational Programme (OP)  for Component III was prepared by the 
national authorities during the year 2007 in close cooperation with the Commission. The OP 
obtained the favourable opinion of EU Me mber State Coordination Committee of the 
EN 35   EN Structural Funds. The Regional Development OP was adopted by Commission Decision on 29 
November 2007.  
Component III 2007 2008 2009 Total 
III-Regional Development 7.4 12.3 20.8 40.5 
Its overall objective is to s upport the sustainable developmen t of the country through the 
improvement of transport and environment infrast ructure. Assistance in the transport sector 
focuses on the continuation of the developmen t of the South East Europe Core Regional 
Transport Network (corridors VIII  and X). This strategy is strongly supported by Member 
States and IFIs who provide substantial f unding (namely Greece and the EIB), to permit the 
completion of strategic transport corridors whic h will benefit the whole region. The priorities 
shall be progressively shifted from corridor X to  corridor VIII as well as from road to rail.  
Concerning assistance in the environment sector , clearly targeted investments will focus on 
waste water treatment and solid waste manage ment where the impact to the population and 
natural environment is the greatest. 
Within the operational programme, a separate priority on technical assistance has been 
introduced, to support national structures managing IPA, including ensuring project 
preparation of high standards for current prog rammes and for future programming periods.  
The institutional set-up which has been set in pl ace for the management of IPA component III 
programme concentrates financial management in  the Ministry of Finance (Central Financing 
and Contracting Department, Natio nal Fund) that delegates some technical tasks to the line 
ministries concerned (transport and environment). 
4.2.2.5.  Component IV: Human Resources Development 
Concerning Component IV, the OP "Human Resources Development" was adopted on 7 
December 2007. It encompasses three priority axis: "Employment – Attracting and retaining 
more people in employment", Education and Training – Investing in human capital through 
better education and skills", a nd "Social Inclusion – Promoting an inclusive labour market".  
Component IV 2007 2008 2009 Total 
IV – Human Resources Development 3.2 6.0 7.1 16.3 
 
4.2.2.6.  Component V: Rural Development  
It should also be noted that for Component V, , a multi-annual "Operational programme for 
the Rural Development" was prepared in 20076 and consists of 3 priority axes: "Improving 
market efficiency and implementation of Comm unity standards", "Preparatory actions for 
implementation of the agri-envir onmental measures and local rural development strategies" 
and "Development of the rural economy". 
                                                 
6 The programme was adopted by the Commission Decision C/2007/677 on 25 February 2008. 
EN 36   EN Component V 2007 2008 2009 Total 
V – Rural Development 2.1 6.7 10.2 19.0 
4.2.3.  Implementation Modalities and Structures 
The IPA Regulation stipulates that implementati on of Components III, IV  and V is subject to 
the conferral of management by the Commission to  the beneficiary country. This is expected 
to take place in late 2008 – early 2009. For Components I and II, direct centralised 
management – i.e. the Commission (EC Delegati on to Skopje) acting as contracting authority 
on behalf of the beneficiary count ry – is allowed for an initial phase as long as conferral of 
management power (decentralised implementa tion system – DIS) has not been granted. 
The former Yugoslav Republic of Macedonia's pa rticipation in horizontal nuclear safety, 
customs and education programmes is also funded from its component I envelope. These programmes are not included in the component I national programme as they will be implemented on a multi-country basis and be ma naged centrally by th e European Commission 
in Brussels.  
In 2007 the Commission has supported through CARDS the national authorities in their 
preparation for decentralised management. Assist ance has been provided to the structures and 
authorities as defined in article 21 of the IPA Implementing Regulation to prepare for their 
DIS accreditation. This is being done via ha nds-on support to the designated bodies, the 
elaboration of project implementation manuals, manual of procedures, programme operational 
guidelines, draft texts of im plementing agreements amongst the different structures and 
authorities.  
4.2.4.  Overview of IPA programmes implemented 
4.2.4.1.  Component I: Transition Assistance and Institution Building 
The tender of the project "Int egrated Border Management" wa s launched and evaluated in 
2007. The evaluation of the tender proposals for the national project on "Reforms in the 
Customs Administration" is ongoing. Several Framework Contracts under the "Project 
Preparation Facility Support" project fiche are in progress. 
4.2.4.2.  Component II: Cross-Border Cooperation 
The programmes were adopted towards the end of 2007. There was no implementation of IPA 
projects in 2007. The CBC programme between  the former Yugoslav Republic of Macedonia 
and Albania expects the first launch of a Call for proposals under people-to-people actions by 
September 2008.  
4.2.4.3.  Component III: Regional Development 
The operational programme was adopted towards the end of 2007. There was no 
implementation of IPA projects  under Component III in 2007. 
4.2.4.4.  Component IV: Human Resources Development 
The operational programme was adopted towards the end of 2007. There was no 
implementation of IPA projects  under Component IV in 2007. 
EN 37   EN 4.2.4.5.  Component V: Rural Development 
There was no implementation of IPA projects under Component V in 2007. 
4.2.5.  Participation in Community  Programmes and Agencies 
The IPA programme 2007 foresees a Commun ity contribution of € 0.94 million to the 
participation of the former Yugoslav Repub lic of Macedonia in Community Programmes. 
These funds are to cover around 85 % of the co st for the "entry tic kets" for the various 
programmes and agencies.  
For some programmes, Memoranda of Unde rstanding (MoU) were signed in 2007 (7th 
Framework Research Programme, PROGRESS, CIP-  EIP) for other programmes this will be 
the case in the second half of 2008 (CIP-ICT, CIP -IEE, Europe for Citizens, Media, Fiscalis 
2013and Customs 2013).  
Whereas CARDS has paid for the "entry tick ets" for 2007 and 2008 for the 7th Framework 
Research Programme and CIP-EIP, IPA 2007 will pay for the outstanding ones.  
In addition, IPA 2007 Component I for the form er Yugoslav Republic of Macedonia provided 
€ 900,000 of IPA funding for preparatory measures for participation in the Lifelong Learning 
and Youth in Action programmes. Participatio n in these programmes is conditional on the 
fulfilment by the candidate count ries of requirements concer ning the capacity of national 
structures – called the National Agency – to ensure sound financial management of the 
programmes without ex-ante co ntrol of the Commission.  
4.3. Monitoring and Results  
4.3.1.  State of play for IPA Monitoring Co mmittee and Sectoral Monitoring 
Committees 
Programme implementation under IPA shall be monitored through the IPA Monitoring 
Committee assisted for each component by Sectoral Monitoring Committees. Each 
Committee shall satisfy itself as to the effectiveness and quality of the implementation of the programmes and operations. They may make pr oposals to the Commission and the national 
IPA-coordinator, with a copy to the nationa l authorising officer, for decisions on any 
corrective measures to ensure the achieveme nt of programme objec tives and enhance the 
efficiency of the assistance provided. 
4.3.2.  IPA Monitoring Committee 
The set up of the IPA monitoring committ ee is planned for the first half 2008  
4.3.2.1.  Component I 
The set up of the Component I Sectoral mon itoring is planned for the first half 2008. 
4.3.2.2.  Component II 
The set up of the joint monitoring committees of  the cross–border progr ammes is planned for 
the first half 2008. 
EN 38   EN 4.3.2.3.  Component III 
The first Sectoral Monitoring Committee was held on 10 December 2007 in Skopje under a 
provisional form. It provided the basis for a wider partnership involve ment in overseeing the 
future implementation of the programme and re solved key procedural issues (membership, 
internal rules of procedures, etc). The strategic role of the SMC will increase as the implementation of the programme becomes effe ctive upon the conferral of management and 
signature of the financing agreement. 
4.3.2.4.  Component IV 
The set up of the sectoral monitoring committee for the OP Human Resources Development is 
planned for the second half 2008. 
4.3.2.5.  Component V 
The first shadow Sectoral Monitoring Co mmittee took place on 25 October 2007. The set up 
of the sectoral monitoring committee (IPARD Monitoring Comitte) for the IPA Rural Development programme is pl anned for the first half 2008. 
4.3.3.  Annual and final reports on implementation 
No IPA report on implementation was submitted by the national authorities in 2007 as the 
first IPA programmes were only adopted at th e end of 2007 and implementation had not yet 
started. 
The first sectoral annual reports  shall be submitted by the national operating structures to the 
national IPA co-ordinator, the national authorising officer and to the Commission, after 
examination by the aforementioned sectoral m onitoring committees, and for the first time in 
2008
7. 
On the basis of these reports, the national IPA co-ordinator sh all send the IPA annual report 
on implementation, covering all IPA component s, to the Commissi on and the national 
authorising officer, after exam ination by the IPA Monitoring Committee and for the first time 
in 2008. 
4.3.4.  Evaluation results and Lessons learned 
An ex-ante evaluation was carri ed-out by independent expert s for the Rural Development 
programme. The conclusions/recommendations of this  report were taken into consideration in 
preparing the final version of the progr amme. Additionally multi-annual; operational 
programmes under components III and IV were subj ect to ex-ante evaluations carried out in 
accordance with Structural Funds guidelines and procedures  
No additional IPA evaluations were carried out in 2007, as the first IPA programmes were 
only adopted at the end of 2007 and implementation had not yet started. 
                                                 
7 The exceptions are Component II cross–border programmes, where the first sectoral annual reports shall 
be submitted "in the second year following the adoption of the programme" (i.e. in 2009), and 
Component V, where the first sectoral annual report shall be submitted within six months of the end of 
each full calendar year of programme implementation. 
EN 39   EN 4.3.5.  Sectors with positive results – Success story 
No IPA projects have been fi nalised in the course of 2007. 
EN 40   EN 5. KOSOVO  (UNDER UNSCR  1244/99)8 
5.1. The year in review  
5.1.1.  Political developments 
In November 2005, former Finnish President Martti Ahtisaari was appointed the special 
envoy of the UN Secretary General (UNSG) to pr epare a proposal for the future status of 
Kosovo. Following a number of status consulta tions and a final high-level meeting between 
Belgrade and Pristina on 10 March 2007, Mr Ahtisaari deliver ed a Comprehensive Proposal 
for the Kosovo Status Settlement to the UNSG on 15 March. The UNSG forwarded Mr Ahtisaari's Proposal to the UN S ecurity Council. Belgrade and Pristina maintained divergent 
positions as to whether Kosovo should be independe nt or be an autonomous part of Serbia; 
whereas the Kosovo Assembly confirmed its sati sfaction with the Ahtisaari Proposal, it was 
rejected by Serbia. On 1 August, the UNSG endorsed a ne w initiative on determining 
Kosovo's status via further negotiations, mediat ed by an EU-US-Russia troika. Direct talks 
between Pristina and Belgrade unde r the auspices of the troika started on 28 September. On 
10 December 2007, the troika reported to the UNSG that the negotiations had failed to bring 
about an agreed outcome . 
5.1.2.  Macroeconomic developments and structural reforms 
Kosovo's official GDP per capita was 1,118 € / year in 2006. Growth estimates for 2007 stood 
at 3.5 %. Inflation remained low until 2007 (1,6 in 2006) but could well  peak to 12 % in 2008. 
The level of unemployment is substantial (4 7 % in 2006), and growing. The size of the 
informal economy is significant although no estim ates are available. As a result, actual 
expendable revenue per capita could be higher and is boosted by remittances from abroad. 
Public finances in Kosovo were  healthy, with the budget showi ng a surplus of 6.5 % of GDP. 
The Euro is the de facto curr ency of Kosovo. Fiscal policy is  conducted on the basis of the 
Medium Term Expenditure Framework. As concer ns foreign trade, the balance of payments 
showed a deficit of 24 % of GDP. FDI has grow n steadily from less than  1 % of GDP in 2004 
to 12 % in 2007. However, this would include  investment in small scale commercial 
undertakings, with limited value added and re presenting a modest c ontribution to GDP. No 
bilateral trade agreements ex ist with the EU. Kosovo benef its from autonomous trade 
preferences granted to the count ries of the region, allowing for free access to the EU market. 
Kosovo is part of CEFTA. Membership of th e IMF would open the door  to involvement of 
IFIs. The EBRD and EIB only have a limited presence in Kosovo. 
5.1.3.  Progress in meeting the acquis communautaire 
Kosovo is participating in the Stabilisation and Association process (SAp). Meetings of the 
SAp Tracking Mechanism were held in March and November 2007 (check). In March 2007, a new structure of sectoral meetings for th e STM was established in the areas of good 
governance, economy, internal market, innovation and infrastr ucture. The new structure 
provides the mechanism for a more detailed analys is of the conformity of the legislation, 
practices and policies in Kosovo in European standards. The EU provides guidance to the 
authorities on reform priorities through the European Partnership. Progress on these reform 
                                                
 
8 Under United Nations Security Council Resolution 1244 of 10 June 1999. 
EN 41   EN priorities is encouraged and monitored through the STM. Some progress has been made in the 
implementation of the first transitional pha se of the European Common Aviation Area 
Agreement (ECAA).  
5.2. IPA in 2007 
5.2.1.  MIPD 2007-2009  
The Multi-annual Indicative Planning Docu ment 2007-2009 for Kosovo was adopted by the 
Commission on 1 June 2007. It follows the EU policy for the Western Balkans, the 
Stabilisation and Association process (SAp ). The Commission's Enlargement Strategy 
Communication of November 2007 confirmed that  Kosovo merited particular attention, with 
the EU and Member States needing to take th e lead in the international community in line 
with the EU's crucial role  in a post-status Kosovo. 
Therefore, the major challenges for Kosovo that should be addressed by the Multi-annual 
Indicative Planning Document (MIPD) are: 
Political Criteria:  EC assistance under this heading shoul d focus in particul ar on support to 
the development of civil society, minority rights and the rule of law in Kosovo. More efforts should be devoted to help the authorities develop a reform ag enda that promotes fiscal 
sustainability, good governance of public expe nditure, sound financial management and 
knowledge society. 
Economic Criteria:  EC assistance should also be us ed in support of developing Kosovo’s 
economy and improving the socio-economic environm ent of all communities in a sustainable 
way. This should require measures that can catalyse IFI and priv ate sector investment, taking 
due account of the limitations the status  issue imposes on such investment. 
The European agenda:  In addition to the above, EC assistance should continue to support 
Kosovo's European vocation and its integration into the Western Balkans region as a whole. 
Guided by European Partnership priorities, a gradual approximation to EC legislation in 
specific sectors, increased attenti on to the rule of law in the wi der sense, and preparations for 
Kosovo's participation in Community progr ammes should be some salient features. 
The indicative funding available for the period 2007 – 2009 amounts to €259.1 million
9 for 
Component I (Transition Assistance and Inst itution Building) and Component II (Cross-
Border Co-operation). 
                                                 
9 Additional allocation of €60 million to the IPA Component I in Kosovo was included in EU 2008 
Budget to accompany the expected challe nges resulting from status resolution. 
EN 42   EN 5.2.2.  Programming exercise 
(in million euro, to the nearest 100,000 euro) 
KOSOVO (under UNSCR 1244)  2007 
I Transition Assistance and Institution Building –  68.3
Of which: Annual Programme  62.0
Customs Programme 3.5
Tempus and Erasmus Mundus Programmes 2.8
 
5.2.2.1.  Component I: Transition Assistance and Institution Building 
The total annual allocation for Kosovo in 200 7 was € 68.3 million, all of which will be 
implemented under component I.  
The € 62 million IPA annual programme for Ko sovo was adopted by the Commission on 28 
November 2007. It included € 2.8 million or iginally allocated to component II. 
The IPA annual programme contained the following projects: Political Requirements (27 %)  
• Building the capacity of Kosovo's institutions to develop EU compatible legislation and 
policy, € 6 million 
• Strengthening the Rule of Law, € 7 million 
• Return, Reintegration and Cultural heritage in Kosovo, € 3.7 million 
Socio-economic Requirements  (53 %) 
• Developing an enabling economic environment for all of Kosovo's communities, € 11 
million 
• Reconstruction of roads and bridges, € 8 million 
• Support to local government and decentralisation, € 12.4 million 
• Education in Kosovo: Inter-culturalism and the Bologna Process, € 1.4 million  
European Standards  (10 %) 
• Meeting EU Standards in Energy Sector, € 3 million 
• Meeting EU Standards in Food Safety and Veterinary Services, € 2 million 
• Meeting EU Standards in Public Procurement, € 1.5 million 
EN 43   EN The programme has a facility for project prepar ation of € 1 million and a reserve of € 5million 
(10 %). 
5.2.2.2.  Component II: Cross-Border Cooperation 
In 2007, the conditions for programmes under Co mponent II in Kosovo were not met. The 
funds for Component II have b een included in Component I. 
5.2.3.  Implementation Modalities and Structures 
IPA programmes in Kosovo shall be implemen ted under centralised management by the 
European Commission. The programmes could also  be implemented using joint management 
with International Organisations. As any othe r IPA beneficiary, Kosovo has to establish a 
Roadmap for the decentralisation of the manage ment of EU funds, ini tially with ex ante 
controls by the Commission. Kosovo is at very ea rly stage. As the first step, Kosovo needs to 
appoint the NIPAC, which could be either the Director of the Agency for European 
Integration under the Deputy Prime Minister's  Office or the Deputy Prime minister. The 
discussions on "Roadmap for DIS" are expected to start in 2008-2009. The EC is in process of 
supporting the Kosovo's authorities to take more ownership of th e annual programming 
process. 
IPA Framework Agreement for Kosovo was signed on 19 December 2007. 
IPA 2007 programme 
Programming task Manager is Unit C3 (Kosovo issues unit), DG Enlargement. The 
Implementing Authority is the European Comm ission except for the two following actions - 
Activity 2 of Project 3 "Return, Reintegr ation and Cultural Heritage" and Project 7 
"Education in Kosovo: Inter-culturalism and the Bologna Process" which shall be implemented by joint management with the Council of Europe. 
Implementation Task Manager is the Operations Section of the EC Liaison Office in Kosovo 
except for Activity 1 of Project 1 "Legal and Policy Advice to Kosovo's Authorities" where 
the Implementation Task Manager is DG En largement's Institution Building unit. 
Kosovo's participation in horizontal customs a nd education programmes is  also funded from 
its component I envelope. These programmes ar e not included in the component I annual 
programme as they will be implemented on a multi-country basis and be managed centrally 
by the European Commission in Brussels.  
5.2.4.  Overview of IPA programmes implemented 
5.2.4.1.  Component I: Transition Assistance and Institution Building 
11 IPA 2007 tender forecasts we re published in December 2007 w ith a suspension clause on 
availability of funds dependi ng on the signature of the Fina ncing Agreement (expected in 
2008). 
5.2.4.2.  Component II: Cross-Border Cooperation  
Funds are included in Component I. 
EN 44   EN 5.2.5.  Participation in Community  Programmes and Agencies 
There is no framework agreement concerni ng participation of Kosovo in Community 
programmes. Kosovo did not participat e in Community Programmes in 2007. 
5.3. Monitoring and Results 
5.3.1.  Monitoring 
Kosovo is included in the target area of th e ROM project managed by DG Enlargement's 
Regional and horizontal programmes unit . Info rmation on IPA 2007 projects to be monitored 
was provided to the contractor of the ROM project. 
5.3.2.  Evaluation results and Lessons Learned  
So far there are no evaluation results of IP A programmes in 2007 as the implementation only 
started in 2008. For the first year of IPA no  lessons learned can be identified as the 
implementation only started in 2008. 
5.3.3.  Sectors with positive results- Success story box 
Given that the IPA Financing Agreem ent was not signed in 2007 (see 2.3), IPA 
implementation in 2007 has been very limited. 
EN 45   EN 6. MONTENEGRO 
6.1. The year in review  
6.1.1.  Political developments 
Following political developments in 2006 mark ed by the independence of Montenegro and 
Parliamentary elections, 2007 was characterised by intensive Eur opean integration activities 
and debates on the country’s new Constitution.  The Constitution was adopted in October 2007 
and is broadly in line with European standard s. The Stabilisation and Association Agreement 
with the EU was signed on 15 October 2007; an Interim Agreement was also signed which entered into force in January 2008. However,  compliance with the requirements of the 
Agreement suffers from a weak administrative capacity across most s ectors. Progress on these 
reform priorities is encouraged and mon itored by the enhanced permanent dialogue.  
In January 2007, the firs t political dialogue meeti ng between the EU (tro ika) and Montenegro 
was held. In September 2007, the EU and Monteneg ro signed agreements on visa facilitation 
and readmission. The new arrangements will simplif y procedures for issuing visas to certain 
categories of citizens of Montenegro, including st udents, scholars, busine sspeople, journalists 
and tourists. 
6.1.2.  Macroeconomic developments and structural reforms 
Thorough analysis of Montenegro’s economy is hi ndered by weak statisti cs and a large grey 
economy.  
The general government balance surplus increased from 3.4% of  GDP in 2006 to a surplus of 
8.5% in 2007. Surplus and privatization recei pts amounting to 3.2% of GDP led to an 
equivalent increase in government deposits with the banking system and further reductions in 
government arrears, as well as to a re duction of domestic and foreign debt. 
The trade deficit increased to almost 60% of GDP in 2007, from 40% in 2006. However, a 
surge in net foreign direct investment (fro m about €500 million to €700 million) helped close 
the gap in the balance of paymen ts. Significant inflows of foreig n direct investment (FDI) and 
rapid credit growth have caused a large curr ent account deficit, increasing the risk of 
macroeconomic instability in the near to medium term.  
The major sectors driving economic  activity are construction, fina ncial services and tourism, 
with FDI playing a major role in each.  
6.1.3.  Progress in meeting the acquis communautaire 
The SAA agreement  and the Interim Agreement between  the EU and Montenegro were 
signed on 15 October 2007. Sustained effort is needed for the strengthening of the 
administrative capacity to perform commitments as  from the entry into force of the Interim 
Agreement. In May 2007 the government adopted an Action Plan for the implementation of 
the European Partnership and started implementation.  
Support has been provided to relevant gove rnment institutions to assist in legal 
harmonisation  in key areas relevant to the acquis, e .g. data protection, in tellectual property 
rights, telecommunications, veterinary, fisheries. 
EN 46   EN Progress has been made towards the environmental  requirements of the acquis following the 
adoption of a number of legal acts transposing the relevant EU environmental acquis. Further 
progress will be achieved through the estab lishment of an independent Environmental 
Protection Agency which, when it becomes ope rational, will assume responsibility for 
inspection, permitting, enforcement and dissemination of environmental data. 
Some progress has been made in the implementation of the first transitional phase of the 
European Common Aviation Ar ea Agreement (ECAA).  
The legal framework in the domain of public procurement  has been reviewed and the 
administrative capacity of the Public Proc urement Commission has been strengthened. 
Training has been provided to governmental pr ocurement units in the application of the new 
public procurement legislation, system and pr ocedures, which have been independently 
assessed as being well-aligned with the acquis. 
Initial progress has been made on the de velopment of the infrastructure for metrology, 
standards, testing and quality  (MSTQ) in compliance with the acquis and WTO 
requirements. National needs have been anal ysed, the long-term MS TQ strategy has been 
reviewed and the legal framework assessed for its degree of compatibility with the acquis. 
Support to the fisheries  sector has established adequate ad ministrative structures which move 
towards acquis goals and advance the competitiveness of the sector. 
6.2. IPA in 2007 
6.2.1.  MIPD 2007-2009  
During the year 2007, the MIPD 2007-2009 was adopted on 1 June 2007, and the MIPD 
2008-2010 was prepared. Both are in line with  the recommendations of the Enlargement 
Strategy, the European Partnership, and the SAA.  
IPA Component I will support Mont enegro in the following areas: 
• Political criteria . An increased importance is given to this priority axis which will thus 
focus on the consolidation of democratic in stitutions, reform of the judiciary, public 
administration reform including decentralis ation and local government, fight against 
corruption and organised crime, human ri ghts and protection of minorities, anti-
discrimination, as well as the media. Civil society development will be given special 
attention for the promotion of dialogue; sm all grants will assist environment, anti-
discrimination, gender equality, social inclus ion, health, business advocacy, and consumer 
protection10. 
• Economic criteria . This priority axis will con centrate on employment generation, 
education, research, social inclusion, heal th, business environment, budget and fiscal 
management, rural development, food safety, environment, energy, tr ansport, as well as 
infrastructure and other activities which will prepare the country for future Structural 
Funds. 
                                                 
10 It will be complementary to the EIDHR progr amme dealing with democracy and human rights  
EN 47   EN • Ability to assume the ob ligations of membership . IPA will assist th e introduction and 
implementation of the EU acquis in all areas ; the overall coordinatio n of the European 
integration process; strengthening Montenegro 's administrative capacity to implement the 
SAA; preparing for the Decentralised Im plementation System (DIS) for EU funds 
management; and participation to Community Programmes. 
IPA Component II will support cross-border cooperation  activities between Montenegro and 
adjacent Candidate and potential Candidate Count ries and with EU Member States in the 
context of the IPA Adriatic programme. It will al so support the participation of Montenegro in 
ERDF transnational programmes under the Euro pean Territorial Coopera tion objective of the 
Structural Funds. 
6.2.2.  Programming exercise 
(in million euro, to nearest 100,000 euro) 
MONTENEGRO 2007 
I Transition Assistance and Institution Building 27.5
Of which:  National Programme  23.9
Nuclear Safety programme 0.2
Customs Programme 1.9
Tempus and Erasmus Mundus Programmes 1.5
II Cross Border Cooperation 3.9
Of which:  CBC Adriatic programme  0.7
CBC Montenegro and Croatia 0.5
CBC Montenegro and Bosnia & Herzegovina 0.6
CBC Montenegro and Serbia 0.6
CBC Montenegro and Albania 0.6
CBC participation in ERDF SE Europe and ERDF Mediterranean programmes 0.9
Programmes for component II  are adopted for three years. Financia l commitments are made annually and 
therefore figures abov e are just for 2007 
6.2.2.1.  Component I: Transition Assistance and Institution Building 
The programming exercise for IPA 2007 was done  mainly by the European Agency for 
Reconstruction (EAR), in close coordination wi th the National IPA Coordinator (NIPAC) and 
the Secretariat for European Integration (SEI).  
The 2007 National Programme (Component I) focuse s on the continuation of reforms in areas 
such as judiciary, public administration, the fi ght against corruption an d organised crime, as 
well as in the overall process of transposing and implementing the EU standards in various 
EN 48   EN areas. Thirteen projects have been identifi ed for a total amount of € 23.87 million. It was 
adopted on 21 November 2007. 
Under " Political criteria ", there are three projects for a total amount of € 6 million  
supporting Civil society; Fight ag ainst organised crime and corrupt ion; and Judiciary Reform.  
Under " Socio-economic Requirements ", there are three projects for a total amount of € 9.20 
million supporting the establishment of a Nationa l Qualification Framework; Transport 
Sector Management and Infrastructure ; and Energy market approximation.  
Under " European Standards ", there are six projects  for a total amount of € 7.45 million  on 
the following sub-sectors Legal Harmonisation; Veterinary services; Statistical office MONSTAT; Public procurement system; Qual ity Infrastructure (standardisation and 
metrology); and Tax Administration.  
In addition, an amount of € 1.22 million  is foreseen for Project pr eparation facility, technical 
assistance and contingencies; while Tempus an d Nuclear assistance projects are managed by 
Headquarters. 
6.2.2.2.  Component II: Cross-Border Cooperation 
IPA Component II encompasses four cross–bord er programmes between Montenegro and its 
Western Balkan neighbours: Croa tia, Bosnia and Herzegovina, Se rbia and Albania. Moreover, 
it includes the participation of Montenegro in the IPA Adriatic  cross–border programme with 
Member States. IPA Component II  also supports the particip ation of Montenegro in two 
ERDF transnational cooperation programmes:  "South–East Europe" and "Mediterranean". 
Due to its small land area, Montenegro's entire territory is part of one or the other CBC programme. 
IPA CBC combines cohesion and external relation objectives and supports activities such as: 
(1) development of cross-border economic, so cial and environmental activities of border 
areas; (2) addressing common challenges in partic ular in the field of environment and public 
health and development; (3) promoting "peopl e to people" type actions, including among 
NGOs and local authorities. 
6.2.3.  Implementation Modalities and Structures  
Montenegro's participation in horizontal nuclear  safety, customs and education programmes is 
also funded from its component I envelope . These programmes are not included in the 
component I national programme as they will be  implemented on a multi-country basis and be 
managed centrally by the Europ ean Commission in Brussels.  
Related to DIS accreditation, i.e. granting decentralisa tion with ex-ante controls, a strategy 
has been established in accordance with the Commission's guidance "Roadmap for DIS" and 
with the assistance of SIGMA. IPA will support  its implementation, and it is foreseen that 
Montenegro could be granted conferral of  management power in three years time. 
Montenegro has nominated the national IPA co-o rdinator (NIPAC); the competent accrediting 
officer (CAO); the national authorising officer  (NAO); and the Program Authorising Officer 
(PAO).  
A first audit mission by DG Enlargement is due in July 2008. 
EN 49   EN 6.2.4.  Overview of IPA programmes implemented  
During 2007, no IPA programmes were implemented in Montenegro. 
6.2.5.  Participation in Community  Programmes and Agencies 
On the basis of SAA protocol 8 on the pa rticipation of Montenegro in Community 
programmes, Montenegro is participating in  the 7th Framework Programme R&D – EC, and 
the Entrepreneurship an d Innovation Programme 
6.3. Monitoring and Results 
6.3.1.  Monitoring 
No monitoring of IPA projects was carried  out in 2007 as the IPA 2007 programmes were 
only adopted at the end of the year and th e actual implementati on only started in 2008. 
6.3.2.  Evaluation results and Lessons Learned  
So far there are no evaluation results of IP A programmes in 2007 as the implementation only 
started in 2008. For the first year of IPA no  lessons learned can be identified as the 
implementation only started in 2008. 
6.3.3.  Sectors with positive results - Success story box  
For the first year of IPA, no sectors with positive results can be identified as the 
implementation of IPA programmes only started in 2008. 
EN 50   EN 7. SERBIA 
7.1. The year in review  
7.1.1.  Political developments 
Parliamentary elections took place in 21 January  2007 and were conducted in accordance with 
international standards. However, the ensu ing period highlighted sharp divisions among 
political parties. This led to a slow-down in  the overall pace of reform. The Kosovo issue 
continued to dominate the political agenda. Fo llowing several months of uncertainty a new 
reform-oriented government was formed in Ma y 2007. It achieved early positive results on 
cooperation with the ICTY, which enabled th e Commission to finalise negotiations on a 
Stabilisation and Association Agreement (S AA). The SAA was initialled on 7 November 
2007.  
In the area of democracy and the rule of law there was some progress in implementing the 
new constitution which entered into for ce in November 2006. A constitutional law was 
adopted, however several provisions, in part icular, on the judiciar y still need to be 
implemented in line with European standards. 
The work of the parliament has been hindered by the political s ituation. The first sitting of the 
parliament after its inauguration following the January 2007 elections was adjourned for 
almost three months due to the protracted nego tiations to form a government. Delays in the 
formation of the government and sharp poli tical divisions had a negative impact on 
parliamentary activities. 
As regards regional issues and international obligations, Serbia played a positive role in 
improving regional co-operation, including notably the South East Europe Co-operation 
Process (SEECP), the Regional Co-operation Council (RCC) and the amended Central European Free Trade Agreement (CEFTA).  
The government, in its programme, gave a clear  commitment to fulfil its international 
obligations. The Serbian authorities subseque ntly improved co-opera tion with the ICTY, 
leading to the arrest of two indictees and th eir transfer to The Hague. A National Security 
Council was established. The National Council for Co-operation with ICTY was also 
reinstated. However, Serbia did not achieve fu ll co-operation with the ICTY that should lead 
to the arrest of the remaining fugitives.  
Serbia participated in 2007 in discussions under the auspices of the UN Secretary General's 
Envoy for Kosovo on the future status of Kosovo. Serbia however rejected its 
recommendations and has maintained that Kos ovo should remain an integral part of the 
country, whilst offering substantial autonomy. Se rbia continued to discourage Kosovo Serbs 
from participating in the provisi onal institutions of self-govern ment and elections in Kosovo.  
Visa facilitation and readmission agreements have been concluded between the European 
Union and Serbia. The visa facilitation agreem ent will foster people-to-people contacts and 
increase opportunities for tr avel, especially for the you nger generation. The agreement 
contains a joint declaration from  the parties to start a discu ssion on visa liberalisation and a 
statement that the agreement should be seen as a first concrete step towards full visa 
liberalisation. The Readmission Agreement set out  clear conditions and procedures for the 
EN 51   EN authorities of both Serbia and the EU Member States for taking back people who are illegally 
residing on their territories. The effective im plementation of the agreements, as well as 
progress in key areas such as border manageme nt, document security and the fight against 
organised crime, will open the way towards a visa-free regime. 
7.1.2.  Macroeconomic developments and structural reforms 
Serbia’s economy continued to grow strongl y but progress in macroeconomic stabilisation 
was mixed. The reversal of fi scal consolidation added to fi scal and macroeconomic risks. 
Much needed structural reforms continued slowly and the high level of unemployment 
remained a major challenge. 
As regards the economic criteria, Serbia made some progress towards establishing a 
functioning market economy. Further reform efforts must be pursued to en able Serbia to cope 
in the medium term with the competitive pressures and market forces within the Union. 
The authorities to a large extent maintained the main elements of a sound economic policy. 
The economy continued to expand strongly. The inflow of foreign capital remained 
significant. Declining inflation contributed to a stable environment for economic actors. The 
budget remained in surplus and investment activity improved markedly. 
The privatisation of state-owned banks is well advanced and competition among banks is 
strong. The new government has shown limite d willingness to revive the process of 
privatising state-owned companies. The SME s ector grew in importance. Foreign trade and 
investment continued to grow and econo mic integration with the EU advanced. 
However, despite strong economic performan ce, unemployment remains very high. Further 
progress in privatisation is needed and a co mpetitive and dynamic private sector has not yet 
been fully established. Fiscal policy turned  expansionary in 2007. Public sector wages 
increased substantially. This contributed to a si zeable increase in expenditures as a percentage 
of GDP in 2007 and added to external imbalances  and inflationary pressures. The lack of 
flexibility in the labour market remains an obstacle for job creation. I nvestment was hampered 
by excessive bureaucratic requirements and complex legislation. Commercial courts 
continued to suffer from limited capacity and expertise. The large informal sector, fuelled by weaknesses in law enforcement and the regulato ry framework, reduces the tax base, hampers 
the government's capacity to implement economic  policies and affects negatively the business 
environment. 
In general terms, Serbian economy performed we ll. However, there were a number of major 
imbalances mainly inflation, unemployment and the growing balance of payment deficit.  
7.1.3.  Progress in meeting the acquis communautaire 
The government placed emphasis in its programme  on European integration, but the results 
were mixed. In August 2007 the government a dopted an action plan on harmonisation with 
the acquis in an attempt to accelerate the reform process.  The Serbian administration 
participated in SAA negotiations in a profe ssional manner and this helped to improve 
coherence among the various Ministries and ag encies. Policy co-ordination, however, needs 
to be further improved. 
EN 52   EN As regards European Standards, SAA negotiations  showed that Serbia has the administrative 
capacity to progress towards the EU. Serbia will be well placed to implement a future SAA if 
this capacity is properly utilised. 
Serbia made some progress in addressing Partners hip priorities in the areas of the internal 
market. Serbia has shown progress in approxima ting with European standards on a number 
sectoral polices. In the area of industry and SM E Serbia is fully committed to the process of 
the European Charter for Small Enterprises. Serb ia's preparations in the area of agriculture 
slowed down. Efforts need to be maintained and expanded into a numbe r of more specific 
areas such as veterinary and phytosanitary is sues and food safety. Progress was made on 
improving the quality and reliability of statisti cs on labour market and business activities, 
whilst further progress is needed on agricultur e statistics and streng thening administrative 
capacity.  
Further progress has been made in the implementation of the first transitional phase of the 
European Common Aviation Ar ea Agreement (ECAA).  
7.2. IPA in 2007 
7.2.1.  MIPD 2007-2009  
Having signed the IPA Framework Agreemen t on 20 November 2007 with the Commission, 
Serbia will receive pre-acce ssion financial assi stance from 2007 onwards. The Serbian 
government played an active ro le in the preparation of th e 2007-2009 Multi-A nnual Indicative 
Planning Document (MIPD) which was adopted in June 2007. The MIPD sets out the priorities for EU financial assistan ce under the new IPA for the period 2007-2009.
 
7.2.2.  Programming exercise 
(in million euro, to the nearest 100,000 euro) 
SERBIA 2007 
I Transition Assistance and Institution Building 181.5
Of which:  National Programme  164.8
Nuclear Safety programme 5.5
Customs Programme 1.5
Tempus and Erasmus Mundus Programmes 9.7
II Cross Border Cooperation 8.2
Of which:  CBC Serbia and Bulgaria  1.3
CBC Serbia and Romania 1.6
CBC Serbia and Hungary 1.3
CBC Adriatic programme 0.3
CBC Serbia and Croatia 1.0
EN 53   EN CBC Serbia and Bosnia & Herzegovina 1.1
CBC Serbia and Montenegro 0.5
CBC participation in ERDF SE Europe programme 1.1
Programmes for component II  are adopted for three years. Financia l commitments are made annually and 
therefore figures abov e are just for 2007 
7.2.2.1.  Component I: Transition Assistance and Institution Building 
The 2007 National Programme for Serbia  under the IPA Transition Assistance and 
Institution Building Component was adopted  by the Commission on 20 December 2007. It 
aims at assisting Serbia to implement the nece ssary reforms needed to fulfil EU requirements, 
make progress in the  Stabilisation and Association proc ess and to lay the foundations for 
fulfilling the Copenhagen criteria as well as to implement the European Common Aviation 
Area Agreement.. 
More specifically, the 2007 IP A National Programme with a total budget of around € 165 
million comprises 37 projects. 2007 IPA is addr essing priorities in the following axes: 
• Political Requirements, with a budget allocation of € 56 million  
• Socio Economic Requirements, with a budget allocation of € 71 million  
• European Approximation of Sectoral Policie s, with a budget allocation of € 34.5 million  
Among others, the 2007 IPA Programme is provi ding assistance to the following projects: 
The Municipal Support Programme with a budget of  € 22 million builds on the strong 
record under the CARDS programme of refo rming central/local government relations, 
promoting decentralisation and supporting admini strative reform at municipal level. The 
specific objective of this pr ogramme is to improve the cap acities for good governance and 
municipal management at the local level, to im prove local services to citizens and to enhance 
local economic development by strengthening lo cal organisations, the Standing Conference of 
Towns and Municipalities and the lo cal-central government cooperation. 
The Support to Refugees and Internally Displaced Persons (IDP) project with a budget of  
€ 10 million which is addressing an issue of major importance for Serbia.  To date the EU has 
been supporting actions such as the closure of collective centres and th e provision of legal 
assistance. This project is designed to suppo rt IDP/refugees living in private accommodation 
to integrate into society, temporary accommoda tion will be supplied to the most vulnerable 
groups and direct legal assistance will be provide d for those who wish to return to Croatia, 
Bosnia and Herzegovina, etc.  
The Support to the Establishmen t of the Ombudsman Office with a budget of  € 1 million 
will contribute the enhancement of the principles of th e rule of law, human rights and good 
governance in Serbia through greater accountab ility of public administrative bodies. The 
project will support the operations of the Se rbian Ombudsman Office as an independent 
institution in line with EU standards.  
EN 54   EN The Regional Economic and Social Development Programme with a budget of  € 21 
million will support the balanced regional economic de velopment in Serbia which is a 
strongly underlined priority in  the MIPD. This project will in crease the capacity of central 
government to design and implement an integr ated regional development policy in Serbia. 
Regional Development Agencies, Municipalities and other local stakeholders will be supported to implement national regional policie s and actions including direct operational 
agreements to the Regional Development Agencies.  
The Health Sector Reform Em ergency Medical Services with a budget of  € 10 million  will 
improve Emergency Medical Servic es (EMS) in Serbia as part of the overall reform of the 
health system. The supply of vehicles and the training of Emergency Medical Services  
personnel will address a major gap in the implementation of the EMS reform strategy. The logistical reach capacity and quality of service delivery of Emergency Medical Services  will 
be extended on a full national territorial level. The project is aiming to purchase of 200 
emergency vehicles, to purchase training m achines in Belgrade, Novi Sad, Niš and 
Kragujevac and to train the staff who will us e the vehicles and the other equipment.  
The Danube River Information System (RIS) with a budget of  € 11 million  will enhance 
the speed, the safety and the efficiency of traffic on the Danube by building a dedicated RIS 
(telematic information service), conforming to the requirements of the EU RIS Directive. This consists of a major project for the country si nce Serbia has an extensive inland waterway 
network comprising of three inte rnational rivers and a channel network of almost 2,000 km of 
inland waterways and the Danube River with  its 588 km passing th rough the country is 
considered to be one of the most  important components of transpor t infrastructure in the entire 
region.  
The Emissions Reduction from Niko la Tesla thermal power plant with a budget of  € 12 
million is a major project for Serbia in order to fulfil its environmental obligations under the 
Energy Community Treaty, (Direc tive 2001/80/EC for large com bustion plants). As such, 
polluting emissions must be reduced from Niko la Tesla thermal power plants which require 
the reconstruction of two electrostatic precipitators  (air filters) this project will provide the 
technical assistance and work s to address this need.  
The Programming of IPA 2008 National Progra mme was also initiated during 2007. The 
priorities of the programme are determ ined by the Multi-annual Indicative Planning 
Document (MIPD) 2008-2010 which was also unde r preparation in 2007. These priority axes 
are:- Political Criteria, Economic Criteria and Ability to assume obligations of 
membership.   
7.2.2.2.  Component II: Cross–Border Cooperation 
Cross–border cooperation helps reconciliation and good neighbourly relations, while also 
facilitating the integration of the beneficiary countries into the EU. 
IPA Component II encompasses three mu lti–annual (2007–2009) bila teral cross–border 
programmes with neighbouring can didate/potential candidate count ries (Croatia, Bosnia and 
Herzegovina, Montenegro) and three bilatera l cross–border programme with neighbouring 
Member States (Hungary, Romania, Bulgaria).  The programmes aim at promoting economic, 
social and environmental development of borde r regions, mainly through activities involving 
local communities.  
EN 55   EN In view of the previous participation of Serbia – Montenegro in the INTERREG 2000–2006 
Adriatic programme, Serbia has been grante d a phasing–out participation in the IPA cross–
border Adriatic programme with Member States , with a limited support of Component II.  
Finally, Component II is also fina ncing the participation of Serb ia in the ERDF transnational 
programme "South–East Europe". 
7.2.3.  Implementation Modalities and Structures  
Serbia's participation in horizontal nuclear sa fety, customs and educa tion programmes is also 
funded from its component I envelope. These pr ogrammes are not included in the component 
I national programme as they will be implem ented on a multi-country basis and be managed 
centrally by the European Commission in Brussels.  
In Serbia, the DIS working group established within the government produced a Strategy for 
the implementation of Decentralized Implemen tation System. In addition, the working group 
will prepare in 2008 capacity building plans for DIS institutions and will make preparatory 
activities for signing the Memorandum of U nderstanding for the introduction of DIS.  
In addition, during 2008 the Government shoul d start establishing national institutions 
relevant for implementation of DIS. According to the SIGMA report on DIS accreditation, national institutions require 24 to 36 months for set-up.  
A first audit mission by DG Enlargement is due in July 2008. 
7.2.4.  Overview of IPA programmes implemented  
No IPA programmes have been implemented in Serbia during 2007. The workload was 
concentrated mainly in the preparation of  tenders under the 2007 National Programme, in 
order to be launched in 2008.  
7.2.5.  Participation in Community  Programmes and Agencies 
Serbia signed the Memoranda of Understandin g for the 7th Framework Programme (FP7). 
The IPA programme 2007 foresees a Community  contribution of € 2 million to support the 
participation of Serbia in Community Programme s. These funds are to co-finance the "entry 
tickets" for various programmes and agencies.  
7.3. Monitoring and Results 
7.3.1.  Monitoring 
No monitoring of IPA projects was carried  out in 2007 as the IPA 2007 programmes were 
only adopted at the end of the year and th e actual implementati on only started in 2008. 
7.3.2.  Evaluation results and Lessons Learned  
So far there are no evaluation results of IP A programmes in 2007 as the implementation only 
started in 2008. For the first year of IPA no  lessons learned can be identified as the 
implementation only started in 2008. 
EN 56   EN 7.3.3.  Sectors with positive results - Success story box  
For the first year of IPA, no sectors with positive results can be identified as the 
implementation of IPA programmes only started in 2008. 
EN 57   EN 8. TURKEY 
8.1. The year in review  
8.1.1.  Political developments 
Turkey continues to sufficiently fulfil the Copenhagen political criteria . Following the 
constitutional crisis in spri ng, early parliamentary elections were held in full respect of 
democratic standards and of th e rule of law. However, li mited progress was achieved on 
political reforms in 2007. Significant further effo rts are needed in particular on freedom of 
expression, on civilian control of  the military, and on the rights of non-Muslim religious 
communities. Further progress is also needed on the fight against corruption, the judicial 
reform, trade union rights, and women's and children's rights. 
8.1.2.  Macroeconomic developments and structural reforms 
The Turkish economy  continued to grow rapidly, with high inflows of foreign investment. 
The monetary and fiscal policy mix was broadl y adequate. Inflationary pressures, growing 
external imbalances and weaker fiscal discip line in 2007 may affect macroeconomic stability. 
Structural reforms have slowed down and labour  market rigidities hamper job creation. 
As regards economic criteria, Turkey can be regarded as a functioning market economy. It 
should be able to cope with competitive pressure  and market forces within the Union in the 
medium term, provided that it implements its comprehensive reform programme to address 
structural weaknesses. 
8.1.3.  Progress in meeting the acquis communautaire 
Turkey improved its ability to take on the obligations of membership.  Progress was made 
in most areas, in particular in the chapters  on free movement of goods, financial services, 
trans-European Networks, and science and resear ch. Alignment is advanced in certain areas, 
such as free movement of goods, intellectual property rights, anti-t rust policy, energy, 
statistics, enterprise and i ndustrial policy, health protec tion, and science and research. 
However, alignment needs to be pursued, in pa rticular in areas such as, free movement of 
services, state aid, agriculture, fisheries, food safety, consum er protection veterinary and 
phytosanitary policies, and environment. A nu mber of obligations by Turkey under its 
Customs Union with the EU remain unfulfille d. Turkey's administrative capacities to cope 
with the acquis need further improvement. 
8.2. IPA in 2007 
8.2.1.  MIPD 2007-2009 
The Multi-annual Indicative Planning  Document  (MIPD) is the strategic programming 
document for IPA in Turkey. It is established for a three year rolling period, with annual 
reviews. The first MIPD for Turkey 2007-200 9 was given a favourable  opinion by the IPA 
Committee on 16 February 2007 and then a dopted through written procedure by the 
Commission on 30 April 2007. The IPA instrument in Turkey, as reflected in the MIPD, 
consists of five components: (IPA-I) the Tr ansition Assistance and Institution Building 
component; (IPA-II) the Cross-Border Coopera tion component; (IPA III, IV and V) the 
Regional, Human Resources and Rural Development components. 
EN 58   EN Within the Institution Building component the focus of assistance  in the area of the political 
criteria is on the institutions th at are directly concerned by the reforms: the judiciary and the 
law enforcement services. A second priority supports the continued development of civil 
society organisations. Among the issues to be addr essed, priority is given to human rights and 
fundamental freedoms; gender issues; and the fight against corruption. As concerns the 
adoption and implementation of the acquis, the main areas of activity, reflecting the volume 
of legislation to be transpos ed and implemented as well as  the investments required, is: 
agriculture and food safety; just ice, liberty and security (p articularly border management; 
migration and visa policy; and internationa l cooperation among law enforcement agencies); 
and environment. The promotion of the Civil So ciety Dialogue is to be implemented through 
grants supporting cooperation be tween EU and Turkish civil society organisations and by the 
co-financing of Turkey's participation in Community Programmes, notably the education and youth programmes.  
The introduction of EU Structural Funds' terri torial cooperation objectiv e is addressed by the 
Cross-border Cooperation  component. Budgetary allocations  in 2007 are divided between 
the bilateral Bulgaria-Turkey cross-border prog ramme and participation in the ENPI Black 
Sea basin programme. 
EU assistance helps to prepar e the beneficiary country for  participation in  Community's 
cohesion policy and rural development instrument s from day one of accession. In view of the 
limited funds available, the multi-annual planni ng strategy laid down in the MIPD pursued 
both sectoral and geographical concentration of  funds. The objectives of the revised Lisbon 
Strategy have also been taken into account, bearing in mind the state of Turkey's economic 
development.  
The Human Resources Development  component supports a sing le OP addressing three 
major areas of interven tion: employment, education and so cial inclusion, which are to be 
implemented by four priority ax es: attract and retain more people in employment, enhance 
investment in human capital, increase adaptabili ty of workers and promote an inclusive labour 
market. 
The Rural Development component sets out thr ee priority axes: adapta tion of the agricultural 
sector and implementing of Co mmunity standards, preparator y actions for agri-environment 
measures and Leader and deve lopment of the rural economy. 
8.2.2.  Programming exercise 
(in € million, to nearest € 100,000)  
TURKEY 2007 
I Transition Assistance and Institution Building 256.7
Of which:  National Programme  256.2
Nuclear Safety programme 0.5
II Cross Border Cooperation 2.1
Of which:  CBC Turkey and Bulgaria  1.1
CBC participation in ENPI Bla ck Sea cooperation programme 0.5
EN 59   EN III Regional Development  167.5
Of which:  Regional Competitiveness Programme  41.9
Transport Programme 58.6
Environment Programme 67.0
IV Human Resources Development 50.2
V Rural Development  20.7
Programmes for components II, III, IV and V are adopted for three years. Financial commitments are made 
annually and therefore figure s above are just for 2007 
8.2.2.1.  Component I: Transition Assistance and Institution Building 
The National Programme (NP) 2007 for Component I is base d on 37 projects, which were 
elaborated by beneficiaries (n otably Ministries) and agreed  upon by the relevant Turkish 
national authorities (NIPAC, NAO) and the European Co mmission. The NP 2007 supports 
measures in the areas of the political criter ia, the adoption and implementation of the acquis 
communautaire and the promotion of the civil society dialogue. After obtaining the favourable 
opinion of the IPA Committee on 29 October the National Programme was adopted by 
Commission Decision on 20 December 2007. 
8.2.2.2.  Component II: Cross-Border Cooperation 
Following the experience gained under the Tu rkey-Bulgaria 2004-06 cr oss-border cooperation 
(CBC) programme, the first multi-annual ( 2007-2009) IPA Bulgaria-Turkey CBC programme 
was prepared by the participating country and adopted by Commission Decision on 20 
December 2007. The objective of the Programme is to help the border region between Turkey and Bulgaria to overcome development problems resulting from its relative isolation and to support the development of co-operative networks on both sides of the border. 
Under the leadership of the Romanian Ministry  for Development, Public Works and Housing, 
which is to become the Managing Authority of  the programme, the Black Sea basin countries 
(Armenia, Azerbaijan, R. Moldova and Georgia (whole territory), Bulgaria, Greece, Romania, 
Russia, Turkey and Ukraine (regions closest to  the basin)) have prepared in 2007 a sea basin 
cooperation programme under the ENPI programme for the period 2007-2013. The 
Commission decision on IPA funding for the partic ipation of Turkey in this ENPI Black Sea 
basin programme was ad opted on 20 December 2007. 
8.2.2.3.  Components III and IV: Strategic Coherence Framework 
As required by Article 154 of Commission Regulation (EC) N°  718/2007, Turkey prepared a 
Strategic Coherence Framework (SCF) for the period 2007-2013, covering IPA components 
III and IV. Its purpose is to set the overall st rategic framework for programming of resources 
in the context of the national priorities for social and economic development and Community 
priorities for cohesion, thus constituting a key reference document for programming IPA 
regional development and human resources de velopment components. The SCF is a key 
document to introduce structural funds strategi c planning to candidate countries (a "mini 
NSRF"), reinforcing the role of IPA assistance u nder components III and IV as a precursor to 
structural funds. 
EN 60   EN The preparation of the Strategic Coherence Fr amework was coordinated by the State Planning 
Organisation, who performs the role of Stra tegic Coordinator for IP A regional development 
and human resources development componen ts. Throughout its preparation extensive 
coordination has taken place with in the national administration, particularly the ministries 
who will be involved in the implementation of components III and IV programmes. Once finalised, it was transmitted to the Commission fo r information and verification of consistency 
with the requirements of the regulation, but the Strategic Reference Framework remains a 
national document.  
The social and economic analysis provided by the Strategic Coherence Framework justified 
the concentration of resources under the re gional competitiveness and human resources 
development programmes in the 12 NUTS II regi ons with a GDP per capita below 75% of 
Turkish national average. The strategic objectiv es are to upgrade the business environment 
and to development better entr epreneurial capabilities of enterprises, and to promote the 
development human resources and skills. As rega rds transport and environment, concentration 
is foreseen on a limited number of projects whic h contribute to promote interconnectivity with 
TEN-T network and intermodality, to promote sustainable development and approximation with the EU environmental acquis. 
8.2.2.4.  Component III: Regional Development  
The multi-annual Operational Programmes (OP) for Component III were prepared by the 
Turkish authorities during the year 2007 in cl ose cooperation with the Commission. All OP 
obtained the favourable opinion of EU Me mber State Coordination Committee of the 
Structural Funds. The Regional Development OPs were adopted by Commission Decision as 
follows: OP Regional Competitiveness and OP  Environment on 29 November 2007; and OP 
Transport on 7 December 2007. The IPA resour ces allocated to each programme are as 
follows: 
Programmes 2007 2008 2009 Total 
III – Transport 58,600,000 60, 800,000 60,300,000 179,700,000 
III– Environment 67,000,000 69, 500,000 67,600,000 204,100,000 
III Regional Competitiveness 41,900, 000 43,500,000 54,800,000 140,200,000 
The overall objective of the "Transport" programme is to increase the competitiveness of 
Turkey by supporting investments in transport in frastructure sector. In this framework the 
scope of the intervention in Turkey will cover tr ansport infrastructure, including in particular 
interconnection, interoperability and intermodality  of national networks and with the trans-
European networks. With regard to freight tr ansportation efforts should be deployed in order 
to rebalance the modes of transportation in favo ur of rail and ports freight transportation. The 
TINA study (Trans European Network for Transport)  is the key determinant for the 
identification of investment prio rities in the transport sector.   
The overall objective of the "Environment" progra mme is to increase the competitiveness of 
Turkey by supporting investments in environment in frastructure sector. In this framework the 
scope of the intervention in Turkey will cover environment infrastructure, in particular in water supply, sewerage and waste water treatme nt and in intergraded waste management. The 
intervention should pursuit a co herent strategy over medium to long term and possibly 
mobilise additional financial so urces as EIB, IFI's and donors. The criteria for projects 
EN 61   EN selection are the impact on the population served, the non affordability of the construction of 
specific projects, the sensitivity of the area. The implementation will pursuit the river basin 
intergraded approach, the sustainability deve lopment principles, the national and regional 
waste management planning and the complian ce with relevant environmental acquis. 
The overall objective of the "Regional Compet itiveness" programme is to increase the 
competitiveness of the poorest regions of Turk ey by supporting enterprises. This objective 
will be achieved through four specific objectives: enhancement of physical and financial infrastructure, increasing business stock, incr easing employment creation capacity of the 
productive sector and enhancing the added value of the production base.  
Within each operational programme, a separate priority on technical assistance has been 
introduced, to support national structures managing IPA, including ensuring project 
preparation of high standards for current programmes and fo r future programming periods. 
The institutional set- up which will be set in place for the management of IPA component III 
programmes concentrates financial management  in experienced structures prepared under 
previous assistance instruments (Central Fina nce and contracts Unit, National Fund) while 
transferring overall management and responsibi lity for implementation to operating structures 
within line ministries. 
8.2.2.5.  Component IV: Human Resources Development 
The multi-annual Operational Programmes (OP)  for Component IV was prepared by the 
Turkish authorities during the year 2007 in close cooperation with the Commission. The OP 
obtained the favourable opinion of EU Member State committees and the European Social 
Fund Committee. The HRD OP was adopted by Commission decisi on on 7 December 2007. 
Component IV 2007 2008 2009 Total 
IV – Human Resources Development 50.2 52.9 55.6 158.7 
8.2.2.6.  Component V: Rural Development 
Under Component V a multi-annual operationa l programme for "agriculture and rural 
development" was prepared by Turkey du ring the course of 2007 and adopted by the 
Commission on 25 February 2008. 
Component V 2007 2008 2009 Total 
V – Rural Development 20.7 53.0 85.5 159.2 
8.2.3.  Implementation Modalities and Structures 
Assistance under IPA component I-IV (exc ept component II – Turkey-Bulgaria CBC 
programme) will be implemented through decentra lised management, initially with ex-ante 
controls performed by the Commission on the te ndering of contracts,  launch of calls for 
proposals and the award of contracts and grants (the exact list of ex-a nte controls will be 
specified in the Commission decisions on the conferral of management powers per 
component). For that purpose, a management a nd control system for the management of the 
different programmes has to be established and accredited by the Turkish authorities before 
EN 62   EN the conferral of decentralised management can be requested from and be given by the 
Commission. 
Decentralised management without ex-ante contro ls by the Commission is an objective for the 
implementation of assistance under IPA Compon ent I-IV. Turkey is required to provide a 
roadmap (as part of Financing Agreements) with indicative benchmarks and time limits to achieve this objective. The minimum criteria  for waiving the ex-ante controls by the 
Commission include the establishment of a benchmarking system with quantitative and 
qualitative aspects as well as a sustained and noticeable downward trend with regard to the 
rejection rate due to the ex-a nte controls by the Commission. 
Assistance under Component V will be impl emented through decentralised management 
without ex-ante controls from the beginning. Th e accreditation and conferral of management 
process is therefore expe cted to take longer as for the other components. 
Turkey's participation in horizontal nuclear sa fety, customs and educa tion programmes is also 
funded from its component I envelope. These pr ogrammes are not included in the component 
I national programme as they will be implem ented on a multi-country basis and be managed 
centrally by the European Commission in Brussels.  
For the implementation of financial assistance a nd in addition to the c onferral of management, 
the European Community and Turkey must sign a Framework Agreement setting out general rules for cooperation (applicable to all componen ts for the whole period of IPA assistance). 
Negotiations on a Framework Agreement with Turkey began in September 2007 and were 
still ongoing at the end of th e reporting period. In addition, th e Commission and Turkey must 
also sign specific Financing Ag reements for each programme.  
Component I and the ENPI Black Sea programme under Component II On 31 October 2007, within the required deadli ne set by the IPA Implementing Regulation, 
the NAO submitted a deviation report to the Eu ropean Commission and informed of his 
intention to accredit for IPA Component I. On 21 November, a Prime Minister circular was 
issued to appoint Board of Treasury Contro llers as the Audit Authority under IPA, and 
Minister Simsek (Treasury) as the Competent Accrediting Officer (CAO). 
On 30 November, the European Commission was informed of the accreditation of the NAO 
and NF through the CAO, Minister Simsek, and of the accreditation of DIS for the 
management of IPA Component I through the NAO based on Art 76 of the IPA Implementing 
Regulation. The NAO stated that  no high risk findings remain ed and that all remaining 
medium risk findings would be addressed the latest by January 20. A p ackage containing all 
documents to be assessed as part of the EC conferral audit was submitted by the Turkish 
authorities to the Commission in early February 2008, in view of a possible conferral audit for 
Component I and II. 
Component II – Turkey-Bulgaria CBC As Turkey-Bulgaria CBC programme will be imp lemented through shared management with 
the Bulgarian Managing Authority in the lea d, no additional accredita tion or conferral of 
management as for the other Components is needed. 
Component III: Regional Development and Co mponent IV: Human Resources Development 
EN 63   EN The process of accreditation of the structures  dealing with Component III and IV began in 
2007. By the end of that year, the Gap A ssessment and the Gap Plugging stages were 
completed and the Compliance Assessment stag e was ongoing. Due to weaknesses identified, 
the Compliance Assessment stage had to be deferred to mid-2008. No application package 
had been submitted to the Commission by th e end of 2007. The Commission expects the 
submission of the application package by end of September 2008. 
The Commission decisional procedure to adopt th e template of the Financing Agreement was 
expected to be adopted in mid July 2008. The si gnature of the Financing Agreements can only 
take place after the conclusion of the intern al accreditation processes and the subsequent 
Commission Decision conferring manageme nt powers to national authorities. 
Component V: Rural Development The Rural Development programme will be implemented by conferring decentralised 
management powers without ex-ante controls to  the Turkish Republic. Th e auditors from DG 
Agriculture and Rural Development conducted tw o advisory missions in May and November 
2007. Despite progress made, it appeared that the original time-table for accreditation by mid 
2008 is unrealistic as significant wea knesses remained to be addressed. 
8.2.4.  Overview of IPA programmes implemented 
The implementation of programmes will effectivel y start once the conferral of decentralised 
management decision per component is take n by the Commission and the Framework and 
Financing Agreements have entered into force.  
No IPA programmes were implemented in 20 07, as the first IPA programmes were only 
adopted at the end of 2007. 
8.2.5.  Participation in Community  Programmes and Agencies 
This IPA Component I NP 2007 foresees Comm unity financial support of € 58 million for 
Turkey’s participation, inter alia, in the fo llowing programmes and agencies for the year 
2008: Lifelong Learning +; Youth in Action; Culture; IDABC; Community Action field in 
public health; PROGRESS; CIP/EIP; Customs 2013; 7
th Framework Programme for 
Research; European Environment Agency (EEA);  European Monitoring Centre for Drugs and 
Drug Addiction. 
8.3. Monitoring and Results 
8.3.1.  State of play for IPA Monitoring Co mmittee and Sectoral Monitoring 
Committees 
8.3.1.1.  IPA Monitoring Committee 
Programme implementation under IPA shall be monitored through  the IPA monitoring 
committee assisted for each component or pr ogramme by Sectoral Monitoring Committees. 
Each committee shall satisfy itself as to the e ffectiveness and quality of the implementation of 
the programmes and operations. They may ma ke proposals to the Commission and the 
national IPA co-ordinator, with a copy to the na tional authorising officer, for decisions on any 
corrective measures to ensure the achieveme nts of programme objec tives and enhance the 
efficiency of the assistance provided. 
EN 64   EN No joint IPA Monitoring Committee took place in 2007, yet in line with requirements from 
the IPA implementing regulation some 'shadow' sectoral monitoring committees for different 
programmes were established and had their inaugural meetings. 
8.3.1.2.  Sectoral Monitoring Committees 
Component / Programme Date of meeting (shadow Committees) 
IPA I TAIB Sectoral Committee 18 December  
IPA III Regional Development 
Sectoral Committees  
Environment 27 November  
Transport 26 November  
Regional Competitiveness 27 November  
IPA IV Human Resource Development 
Sectoral Committee 13 December  
IPA V Rural Development Sectoral 
Committee 29 November  
As regards component III, the first round of  Sectoral Monitoring Committee meetings 
provided the basis for a wider partnershi p involvement in overseeing the future 
implementation of the programmes and resolved key procedural issues (membership, internal 
rules of procedures, etc). The strategic role of the SMC will increase as the implementation of the programmes becomes effective upon the confe rral of management and signature of the 
financing agreements.  
Annual and final reports on implementation PA report on implementa tion was submitted by 
the national authorities in 2007, as the first IP A programmes were only adopted in the end of 
2007 and implementation had not yet started. 
The first sectoral annual implementation reports shall be submitted by the Operating 
Structures to the national IPA co-ordinator, the national authorising officer and to the 
Commission, after examination by the aforemen tioned sectoral monitoring committees and 
for the first time in 2008
11. 
On the basis of these reports, the national IP A co-ordinator shall send the annual report on 
implementation to the Commission and the nationa l authorising officer, after examination by 
the IPA Monitoring Committee and for the first time in 2008. 
                                                 
11 The exceptions are Component II cross–border programmes, where the first sectoral annual reports shall 
be submitted "in the second year following the adoption of the programme" (i.e. in 2009), and 
Component V, where the first sectoral annual report shall be submitted within six months of the end of 
each full calendar year of programme implementation. 
EN 65   EN 8.3.2.  Evaluation results and Lessons learned  
An ex-ante evaluation of the HRD OP was carri ed out in 2007 under the responsibility of the 
Ministry of Labour and Social S ecurity. The results of  the ex-ante evaluati on were taken into 
account in the drafting process of the HRD OP. The final ex-ante evaluation report forms an 
integral part of the HRD OP adopted by the Commission. 
An ex-ante evaluation was also carried-out by indepe ndent experts for th e Rural Development 
programme. The conclusions/recommendations of this  report were taken into consideration in 
preparing the final version of the programme. 
No IPA evaluation of results was carried out in 2007, as the first IPA programmes were only 
adopted in the end of 2007 and im plementation had not yet started. 
8.3.3.  Sectors with positive results- Success story 
No results and success stories from IPA are available yet as no programmes were 
implemented in 2007. 
EN 66   EN PART  II: MULTI-BENEFICIARY  AND  REGIONAL  PROGRAMMES   
9. THE YEAR 2007  IN REVIEW  
The Multi-beneficiary programme is designed  to complement the Component I National 
Programmes and to strengthen multi-lateral expe riences in the Western Balkans and Turkey. 
It provides support through regi onal and horizontal programmes. The main activities of 
particular importance which took pl ace in 2007 are identified below: 
9.1. Addressing the Political Criteria 
9.1.1.  Regional Issues and In ternational Obligations 
9.1.1.1.  Regional Cooperation Initiatives 
European Community assistance to regional co operation has been provided mainly through 
support to the Stability Pact for South Eastern Europe and its Special Coordinator, who was 
tasked to complement the EU Stabilisation a nd Association process (SAp) with the Western 
Balkans. Encouraged by the international co mmunity, the Beneficiaries and Members of the 
South East Europe Cooperation Process (SEEC P) agreed in May 20 06 to take over the 
ownership of certain regional coop eration activities. This led to the decision a year later to 
establish the Regional Cooperation Council (RCC) . Considerable work was done in 2007 to 
establish the legal, administrative and financ ial basis of the RCC which formally commences 
operations in early 2008. It is  a regionally owned cooperation structure located in Sarajevo 
and has been co-financed in the first three years by the Beneficiar ies, the Commission and 
other interested donors.  
As highlighted in the Communication on Enlargement Strategy and Main Challenges 2007-
200812, the EU will continue to support local owne rship of initiatives in regional cooperation. 
The RCC is seen as the key interlocutor fo r regional cooperation and therefore financial 
support will be provided to the RCC Secretaria t. This will be complemented by support for 
thematic or sector specific re gional initiatives originally la unched under the Stability Pact. 
9.1.1.2.  Public Administration (The Regional Sc hool for Public Administration (ReSPA)) 
The Regional School of Public Administration (R eSPA) aims to improve regional cooperation 
in the field of public administ ration, to strengthen administ rative capacity as required by the 
European integration process and to develop hum an resources in line with the principles of 
the European Administrative Space. The ReSPA initiative emerged following the 
Thessaloniki agenda and continues to attract a lot of political interest. During 2007, training activities were continued in 2007 and it was agr eed that the European Institute for Public 
Administration (EIPA) would support phase II of  the project. A call for proposals to decide 
the seat of the future school was launched at the end of 2007. 
                                                
 
12 Communication from the Commission to the European Parliament and the Council – Enlargement 
Strategy and Main Challenges 2007-2008, COM(2007) 663, 6 November 2007 
EN 67   EN 9.1.1.3.  Support to Interim Civilian Administrations 
The political uncertainties surrounding this suppor t, in particular the failure to reach a 
settlement on the future of Kosovo in the Securi ty Council, made it necessary to maintain the 
support to UNMIK Pillar IV for the whole of  2007. Commission Decisions provided for this 
support until the end of February 2008. An agreement was reached with DG External 
Relations to take over the management and fi nancing of the Stability Instrument from 
February 2008 onwards, thus facilitating the continuation of support to UNMIK Pillar IV. 
9.1.2.  Civil Society Dialogue and Development 
In line with the Communication from the Commission on Enlargement Strategy and Main 
Challenges 2007-2008, a revised strategy on Civ il Society Dialogue and Development was 
established in 2007. It was agreed to coordina te and streamline support by focussing on three 
areas of intervention, constituting a new civil society facility: 
(i) Support to local civic initiativ es and capacity building efforts; 
(ii) People-to-People programmes to EU institutions and bodies; 
(iii) Partnership activities between organi sations in the beneficiaries and the EU. 
It was decided during 2007 that the Multi-benef iciary programme would provide horizontal 
technical assistance to suppor t the implementation and mon itoring of both civil society 
initiatives and partnership actions mana ged from Brussels. Support provided is 
complementary to assistance given under the Eu ropean Instrument fo r Democracy and Human 
Rights (EIDHR). 
9.2. Addressing the Economic Criteria 
9.2.1.  Tempus, Erasmus Mundus and Youth in Action 
Education: Multi-beneficiary IPA assistance is  provided in Education via the established 
Tempus and Erasmus Mundus programmes. The Commission offered 100 scholarships for the 
academic year 2007/2008 to postgraduate students from the Western Balkans under the Erasmus Mundus programme. A further 500 scholar ships are available for the academic year 
2008/2009. Following discussions w ith Commission Rehn in April 2008, an additional 600 
scholarships are available for the academic year 2009/2010.  
Youth: Non-formal education an d youth intercultural exchanges play an important role in 
creating an area of peace, stability, prospe rity and freedom. The Communication on the 
Western Balkans of January 2006 indicate d that the Commission will also create new 
opportunities under the Youth Programme. In  2007, the 'Youth in Action' programme 
replaced the Youth programme . This programme supports pr ojects leading to improved 
intercultural dialogue and tolerance among young pe ople, social inclusion of disadvantaged 
youngsters, as well as the strengt hening of youth NGOs and the development of civil society. 
The new ‘Western Balkan Window’ was estab lished in 2007 within the Youth in Action 
Programme to allow more projects submitted by organisations from the Western Balkans to be supported. Continuation of this Window will cont ribute to further expand the actions of the 
European Commission in the field of non-formal  education and youth in the region, and to 
achieve the objectives set in the Commissi on Communication of the Western Balkans of 
EN 68   EN January 2006 and March 2008. Particular attention will be paid to promoting actions in this at 
national, regional and EU levels.  
9.2.2.  International Financing Institutions 
To improve access to finance by candidate and potential candidate countries and territories, a 
strategy was decided in 2007 to develop regional initiatives w ith International Financing 
Institutions (IFIs) during the coming years along three strands: 
(i) Support to private investments (ii) Promotion of energy efficiency investments (iii) Support to investments in infra structure remediation and upgrading 
In light of this new strategic approach, it was agreed to extend the existing energy efficiency 
facility to the Western Balkans. Significant resources are now being devoted to the newly 
established Infrastructure Projects Facility to prepare and promote infrastructure investments 
in transport, energy, environmen t and the social se ctor; these efforts are being made in 
cooperation with the EIB, EBRD, CEB and ot her interested IFIs. At the same time, 
endeavours are being continued to  improve the efficiency of cu rrent facilities, including the 
SME facility which has been impacted by de lays in implementation. Cooperation with the 
European Fund for Southeast Europe (EFSE) to make loan facilities  available to micro-
enterprises and households are also being continued. 
The Commission, the EIB, the EBRD and th e Council of Europe Development Bank 
committed to establish a Western Balkans Inve stment Framework by 2010 with other IFIs and 
donors to further enhance harmonisation and coop eration in investments for socio-economic 
development in the region. 
Regarding coordination with the IFIs, the second  meeting of the IFI A dvisory Group, which is 
linked to the implementation of the Memorandum of Understanding signed  with the IFIs in 
mid-2006, was scheduled for January 2008. T echnical Working Group meetings were 
established for Transport and Energy (Septe mber) and Environment (October). A first 
meeting for the Social sector was not possibl e in 2007 but was held in January 2008. A two-
day IFI coordination meeting with participan ts of all major IFIs, DG ELARG geographical 
teams and Delegations as well as line DGs was held on 10-11 December 2007. 
9.3. Ability to assume the obligations of Membership and approximation to 
European Standards 
9.3.1.  Customs and Taxation 
The project to support Customs administrations in the Western Balkans proceeded according 
to plan i.e. (i) a sec ond contract (€11.42M (CARDS  2006 (€5.3M and IPA 2007 €6.12M)) 
was signed with Eurocustoms to provide assist ance during the second ha lf of 2007 and (ii) a 
consortium was awarded the contract (€7.06M) to continue to support, on a multi-country 
basis, the relevant Beneficiary Customs
13 and Taxation14 administrations un til early 2009. The 
                                                 
13 Albania, BiH, Montenegro, Serbia and Kosovo (under UNSCR 1244). 
14 BiH and Kosovo (under UNSCR 1244) only. 
EN 69   EN Commission's policy is that th e programming and implementatio n of support to Customs and 
Taxation will gradually evolve from having be en programmed and managed horizontally (by 
the Regional Programmes Unit) to bein g managed by the Geographical Units and 
Delegations, starting with Taxation in 2007 and with Customs from 2008. 
10. IPA  IN 2007 
10.1. MIPD 2007-2009  
The Multi-beneficiary Multi-annual Indi cative Planning Document (MIPD) 2007-2009 
provides the strategic three-year plan for progr amming of the assistan ce to potential candidate 
and candidate countries and te rritories through regional and horizontal programmes. Multi-
beneficiary actions complement and add valu e to the support given under the Component I 
National Programmes. Multi-beneficiary IPA assistance is programmed through regional and 
horizontal programmes: 
– Regional programmes facilitate, in particular, the regional  cooperation process among the 
Beneficiaries of the Western Balkans, although Turkey may also partake. These 
programmes endeavour, in particular, to promote reconciliation, reconstruction and 
political cooperation.  
– Horizontal programmes address common needs across several IPA Beneficiaries and seek 
to attain efficiencies an d economies in implementation by providing centrally managed 
and/or jointly managed assistance with in ternational organisations rather than by 
implementing the programmes on a national basis.  Institution building activities are also 
performed in this framework, notably through instruments such as TAIEX and SIGMA.  
Multi-beneficiary actions focus therefore on support that requires collaboration among the 
Beneficiaries, such as regional structures, networ ks of experts or civil servants or to tackle 
needs or problems of a cross-border nature. Ce rtain support under IPA is  also concentrated 
under Multi-beneficiary assistance  in order to have a coordina ted approach and facilitate 
administration and assistance. This includes, for example, collaboration with International 
Financial Institutions for the joint implementati on of certain finance facilities and support to 
the participation in Tempus, Erasmus Mundus or Youth in Action pr ogrammes. The Multi-
beneficiary MIPD also includ es the IPA support given to nuclear safety and radiation 
protection, the Interim Civilian Administratio n in Bosnia and Herzegovina, communication 
and administration, as well as a udit, evaluation and monitoring. 
The Multi-beneficiary 2007-2009 MI PD was based on an indicativ e financial envelope of € 
401.4 million.  
10.2. Programming exercise 
The Accession and European Partnerships as well as the Annual Progr ess Reports set down 
the priorities for programming of assistance under the IPA Multi-beneficiary Programme 
2007-2009. In addition, the Communi cations from the Commissi on on Civil Society Dialogue 
and on the Western Balkans ha ve been taken into  account. During 2007, the Commission has 
further endeavoured to establis h a transparent consultation pro cess in particular with the 
Beneficiaries. This process is aimed at enhanc ing, as far as possible, local ownership of the 
choices, content and design of the programmes. C onsultations take place at regular intervals 
during the programming phase with amongst othe rs, the Beneficiaries, European Commission 
EN 70   EN Delegations, Stability Pact, International Fina ncial Institutions, Civil Society Organisations, 
line Directorate Generals as well as with other Donors.  
The strategic choices identified in the Mu lti-beneficiary MIPD 2007-2009 and the Annual 
Programmes were made based on guidance prov ided in these EU strategic documents, the 
lessons learned from the programming and implem entation of previous EU assistance and the 
findings from consultations with  the aforementioned parties.  
10.3. Implementation Modalities and Structures  
The Multi-beneficiary programme is manage d through centralised and joint management. 
Centralised management is mainly in the form  of implementation by the Commission services 
at Headquarters, but may al so be possible by devolved management by the Commission 
Delegation in the beneficiary countries or  by indirect management through Community 
agencies, Community bodies or national pub lic sector bodies. Joint management is 
complementary to the central management in  that the Commission is the Contracting 
Authority and is managing the funds jointly  with an international organisation.  
10.4. Overview of IPA programmes implemented 
The Multi-beneficiary IPA budget (€108.9 million) was comple mented with € 51.4 million 
which was transferred from the National Progra mmes to facilitate the implementation of 
projects in the areas of Nuclear Safety and Radiation Protection (€ 8.2 million), Education (€ 
29.5 million) and Customs (€ 13.7 million). 
Of the total € 160.3 million (€ 108.9 million + € 51.4 million) budget, eleven contracts in the 
following areas were completed in 2007: Cust oms and Taxation (€ 6 million), Support to 
UNMIK (€ 20.7 million), Monitoring (€ 2 milli on), Stability Pact (€ 2.12 million) and 
Participation in Community Agencies (€ 1.2 million).  
10.5. Participation in Community  Programmes and Agencies 
The ticket to participate in the Programmes or Agencies is financed through the National 
Programmes. Support was provided under the Multi-beneficiary IPA 2007 programme to 
facilitate the preparation of Croatia, Turkey and the former  Yugoslav Republic of Macedonia 
in certain Community Agencies.  
11. MONITORING AND RESULTS  
11.1. Monitoring 
No monitoring activities have  been carried out yet. 
11.2. Evaluation results 
As project implementation commenced only in  the second half of 2007, no evaluation has 
been completed as yet. 
11.3. Sectors with positive results- Success story 
As project implementation co mmenced only in the second ha lf of 2007, there are neither 
results nor success stories as yet.
EN 71   EN PART  III:  TECHNICAL  AND  FINANCIAL  ASSISTANCE  
1. TWINNING  
Twinning has been designed and developed by th e Commission as the main instrument for 
Institution Building. It aims at  helping Candidate and Potential Candidate countries in their 
development of modern and efficient administ rations, with the structures, human resources 
and management skills needed to implement th e acquis communautaire so as to reach the 
same standards throughout the Union and to bene fit fully from European Union membership.  
This instrument has mobilised significant human and financial resources of the Commission 
as well as of the Member States and the bene ficiary countries. Twinni ng projects are based on 
the secondment of EU public sector expert s (Member State officials or mandated body 
experts), known as Resident Twinning Advisors  who are made available to the beneficiary 
country administrations for a period of at least one-year in order to assist these 
administrations to obtain the mandatory result de fined for each and any twinning project. To 
that effect, the Resident Twinni ng Advisors provide technical advi ce and are in charge of the 
day-to-day implementation of the twinning projects. 
They are supported by a senior Project Lead er in their home admi nistration, who is 
responsible for ensuring the overall thrust of the twinning project implementation and for co-
ordinating all other inputs which provides the twinning expertise. In order to achieve the 
aforementioned mandatory results, it is indeed necessary to combine different means of assistance, including short-term e xpertise, training, and other serv ices (such as translation and 
interpreting) in addition to the Resident Twinning Advisor.  
More than 1,400 twinning projects have al ready been funded by the Community since 
twinning was launched in 1998. The average budget for a twinning project is €1 million. 
Almost one half of these projects concerns Ju stice, Freedom and Security issues, Public 
Finance and Internal Market matters. Other areas prioritised include Agriculture and fisheries, 
Environment and Social policy. 
The 2007 programming exercise (the first under IP A) at this stage en compasses 41 projects. 
To date, 16 Twinning projects have been launc hed. Moreover, about 25 Twinning projects are 
programmed to be launched under IPA 2007. The distribution of launched and programmed 
Twinning projects in the Candidate  and Potential Candidate Countries for 2007 is as follows:  
EN 72   EN Number of IPA 2007 Twinning projects 
launched  Number of IPA 2007 Twinning projects 
programmed  
Kosovo 2 Albania 1 
Montenegro 3 Bosnia and Herzegovina 5 
Turkey 11 Croatia 11 
former Yugoslav Republic of Macedonia 1 
 
Serbia 7 
Total 16  
Total 25 
(In 2007 Twinning projects have  also been launched and im plemented in Romania and 
Bulgaria under the Trans ition Facility programme). 
The 16 Twinning projects launched to date are pr ojects in the following sectors: Justice and 
home affairs (9), Agriculture and fisheries (3 ) Internal market and economic criteria (2) and 
Environment (2). 
Furthermore, the Candidate Countries and Potent ial Candidate Countries are being offered the 
possibility of drawing on twinning expertise through “Twinning Light”, in order to address 
well-circumscribed projects of limited scope. In  2007, this instrument has been continuously 
used by the beneficiary administrations.  
2. TAIEX 
TAIEX15 started operations in 1996 as a follow-up  to the Commission’s White Paper on the 
preparation of the associated countries fo r integration into the internal market.  
Since then, TAIEX has evolved in to an instrument providing s hort-term technical assistance 
to facilitate the approxima tion, application and enforcem ent of the EU legislation. 
Apart from the IPA beneficiary countries part ners the TAIEX instrument also covered the 
12 new Member States, the Tu rkish Cypriot community and the countries covered by the 
European Neighbourhood and Part nership Instrument (ENPI). 
TAIEX support consists of expert missions, wo rkshops, peer assessments, study visits and 
training programmes designed on the basis of specific requests and needs of beneficiary 
institutions. TAIEX is demand-driven and it deliv ers services on a "first come, first served" 
basis.  
TAIEX also facilitates the access to several databases (CCVista, Progress, JurisVista, VetLex, 
PhyroLex and Avis) that provide translation of legislative texts and information on the 
alignment of legislation. 
                                                 
15 Technical Assistance Information Exchange Instrument  
EN 73   EN The TAIEX operation continued to develop in a positive and dynamic manner in the course of 
2007. The total number of incoming requests from rose sharply from 1,049 in 2006 to 1,591, an increase of 52%. The major part of applica tions came from the IPA beneficiary countries 
(45%), followed by the 10 new Member States  (26%) and the ENPI countries (14%). 
During the year a total of 1,282 events were organised, representing an increase of 16% 
compared with 2006 and about the same level as 2005. Out of these events 408 were organised for IPA be neficiary countries. 
The number of participants at TAIEX events  went up by some 4% to 36,971 in 2007, while 
the experts engaged went up by 5% to 4,148. Out of those 11,158 particip ants came from IPA 
countries and 1,644 experts were involved in proj ects related to IPA beneficiary countries. 
The positive results and the increasing demand fo r assistance clearly demonstrate the need 
and usefulness of TAIEX as an instrument of  know-how transfer an d exchange of best 
practice.  
TAIEX continued to play an important role  in supporting the Turkish Cypriot community. 
Out of the Financial Aid Re gulation (Council Regulation No  389/2006) the instrument was 
allocated € 11 million to encourage the economic development of the Turkish Cypriot community with particular emphasis on the ec onomic integration of the island, on improving 
contacts between the two communities and with the EU, and on preparation for the acquis communautaire. In 2007 assistance focused on the preparation and launching of the 
Programme for the Future App lication of the Acquis (PFAA), which was finally agreed in 
October 2007 and which will concentrate on 12 EU policy areas. Notable progress have been achieved so far in the sector of environment (creation of basic conditions for the drafting of main framework legislation), the Green li ne Regulation (Council Regulation No 866/2004) 
and the statistical sector (preparation of a“Mas ter Plan” and of a statistical law). Basic work 
has been done to prepare strategies for the agricu ltural sector as well as  for the reform of the 
Customs system.  
2007 was the first full-operational year for the ENP countries and Russia. TAIEX has 
received more than 200 applications from these countries against some 50 in seven months of 
operations in 2006. In the same period, over 3,000 pa rticipants from the administrations of 
these partner countries have been trained. 
The share of ENPI applications has increased from  5% to 14% of the total. For the majority of 
events the subjects covered topics related to in ternal market issues: this is understandable 
considering that the ENP is not offering a prospect of accession, but rather –as stated in all 
Action Plans- "a stake in the EU's internal market ". However, also subjects related to the rule 
of law, to agriculture and to health and safety have received significant attention. 
TAIEX offers access to a range  of databases. The Progress database organises all EU 
legislation in a format that allows a conti nuous exchange of up-to-date information on newly 
adopted acts and on the harmonisation of nationa l legislations. All data collected via the 
Progress Database are shared with the European commission services and delegations, country missions and the concerned national aut horities. CCVista constitutes a repository of 
all translations of EU legisl ation produced by the Translat ion Coordination Units of the 
beneficiary countries. It is a vi tal source of information to a ll internet users who wish to 
consult legislation translated in to various languages of the bene ficiary countries. The database 
is currently being used by the candidate and West ern Balkan countries. By the end of the year, 
EN 74   EN CCVista database contained more  than 5,000 translated EU acts from Croatia and over 2,000 
from the former Yugoslav Republic of Macedonia . This represents over 55,000 OJ pages in 
the case of Croatia and almost 30,000 OJ pages in the case of the former Yugoslav Republic 
of Macedonia. The JurisVista Database is a libra ry of translations of key judgements of EU 
jurisprudence; it is mainly used by the judici ary, academic institutions such as new Member 
State universities and others such  as law firms. VetLex offers direct access to consolidated 
versions of all EU veterinary legislation, simplifying the daily ta sks of veterinary inspectors, 
border post officials and others . Similarly, PhytoLex offers co nsolidated versions of EU 
phytosanitary legislation, while Avis is a database dedicated to  animal diseases. 
The TAIEX Expert Database (ED) represents a key-instrument in the daily work of TAIEX 
assistance tasks. Launched in October 2004, the ED  registers public officials from all the EU 
Member State national administra tions covering a large number of fields of the EU legislation 
body and interested to participate in TAIEX ac tivities. In 2007 more than 3,800 experts were 
present in the ED, a signifi cant increase in comparison with 2006 (with around 2,600 public 
officials signed in). Additionally, more than 550 "institutional" contact points that play a 
coordination role within every ministry of the Member States have been added into the 
database. The Expert Database is contributing to a better identification of appropriate key-
experts in a given field and a smoother and rapid response to bene ficiaries' requests. 
Several Commission Financing De cisions were adopted in 2007 to ensure the continued 
funding of the TAIEX operation. They consisted of € 6.83 million from the Transition Facility 
for Bulgaria and Romania, € 9.28 million from the Instrument of Pr e-Accession Assistance 
(IPA) and € 5.0 million from the Pre-Accession Assistance Funds for Kosovo. Funding also included €1.5 million from MEDA and €1.5 mi llion from TACIS and €2 million from the 
ENPI through sub-delegation from DG AIDCO. 
An ex-post evaluation report on  TAIEX was completed in 2007. It  concluded that TAIEX is 
an important instrument in supporting the ac cession process that ha s performed well in 
providing short-term, demand-driven assistance and a large number of output s. In this context, 
the speedy mobilisation and the handling of ad ministrative details were in particular 
appreciated on the recipients' side. The report recommended that TAIEX should focus more 
on networking opportunities, further increase cost-e ffectiveness and sustaina bility of actions.  
3.
 SIGMA   
Since 1992, this instrument for assistance in horizontal areas of public management (Public 
administrative reform, public procurement, public sector ethics, external and internal financial 
control) is implemented by the OECD through a contribution agreement which is funded by 
the Commission. 
In 2007, SIGMA has worked with the two new EU Member States and th e three EU candidate 
countries as well as with potenti al candidate countries in the Western Balkans. Within this 
context a total of 57 concrete project assi gnments have been approved by the European 
Commission and carried out by OECD: 24 in Bulg aria, Romania, Croatia and Turkey and 33 
in the Western Balkan countries. All of these pr oject activities were car ried out under distinct 
contracts, funded both under the Transition facility and CARDS. 
In the course of 2007, preparations were st arted to launch a new global contract for the 
continuation of SIGMA programme under the ne w financial Instrument for Pre-Accession 
EN 75   EN Assistance (IPA). This new contract will be nefit all Candidate and Potential Candidate 
countries. It will cover 2009-2010 with an  increased global budget of €10.5 million. 
EN 76   EN PART  IV: FINANCIAL  DATA   
In 2007, € 1218.4 million was allocated from the EU budget to operational programmes under 
the Instrument for Pre-Accession assistance. Ov erall the execution rate was 100 %, although € 
50.2 million (4 %) of this was carried forw ard to the 2008 Budget and committed by March 
2008. This related to 8 programmes16 for which preparations were  finalised towards the very 
end of the year following which there was no time for adoption in 2007.  
Due to the adoption of most of the IPA progr ammes late in the year, the consumption of 
payment credits was lower than the forecasts made in the PDB 2007. As a result of this, 
payment credits of several IPA budget lines were return ed in the Global Tran sfer exercise. No 
payments were executed under the IPA CBCs  since the Commission Decision adopting these 
programmes was carried forward to 2008. Concerning the IPA Institutional Building component, € 2.7 million were paid for Bosnia & Herzegovina, € 18.6 million for Kosovo as 
well as € 8 million under the IPA Regional programmes. No payments were executed for Albania, Croatia, fYROM, Mont enegro, Serbia or Turkey." 
1.
 IPA  FUNDS BY YEAR  
Year Funds Committed 
2007 € 1,218,407 million
                                                 
16 Programmes carried-forward were: CBC Hungar y-Croatia; CBC Slovenia-Croatia; CBC Hungary-
Serbia; CBC Romania-Serbia; CBC Bulgaria-Serbia; CBC Adriatic; SIGMA 2007; additional funds for 
participation in the European Fund for Southeast Europe] 
EN 77   EN 2. IPA  FUNDS BY COUNTRY 2007  (IN EURO ) 
Partner Country Commitments (1) Contracts (2) Payments (3) 
Albania 61,000,000   
BiH 62,100,000 5,697,918 2,706,511 
Croatia 141,227,000   
Former Yugoslav 
Republic of Macedonia 
58,500,000   
Kosovo 68,300,000 20,704,005 18,633,605 
Montenegro 31,400,000   
Serbia 189,700,000   
Turkey 497,200,000   
Multi-beneficiary 108,980,000 22,676,232 7,996,785