Opinion of the Economic and Social Committee on the "Proposal for a Council Regulation (EC) on measures to promote the full integration of the environmental dimension in the development process of developing countries"(1)

(1999/C 258/05)

On 5 March 1999 the Council decided to consult the Economic and Social Committee, under Article 198 of the Treaty establishing the European Economic Community, on the above-mentioned proposal.

The Section for External Relations, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 9 June 1999. The rapporteur was Mr Jaarsma.

At its 365th Plenary Session (meeting of 7 July 1999) the Economic and Social Committee adopted the following opinion with 110 votes in favour and two abstentions.

1. Introduction

1.1. The Council regards the proposal as a crucial instrument to assist the Community in meeting its legal and political commitments to the protection of the environment within a context of sustainable development.

1.2. The aim of this regulation is to ensure the continuation of activities implemented under Council Regulation (EC) no. 722/97 of 22 April 1997 after its expiry on 31 December 1999.

1.3. EC economic and development cooperation operates under clear commitments to environmental protection and sustainability. Articles 177 and 174 of the Amsterdam Treaty (Rome Treaty Articles 130 and 130 r, as amended) are of specific relevance here.

1.4. On the international scene, Community commitments made at the United Nations Conference for Environment and Development (UNCED) in Rio in 1992, as well as subsequent developments, are of particular relevance.

1.5. The Community is also party to multilateral environment agreements, such as the Convention on Biological Diversity, the Framework Convention on Climate Change and the Convention to Combat Desertification. All of these conventions entail specific obligations to assist developing countries which are parties to the conventions to meet their own commitments.

1.6. In addition the Community has subscribed to the OECD/CAC's "Shaping the 21st Century Strategy" which calls for support for the implementation of national strategies for sustainable development in all countries by 2005.

1.7. Integration of the environmental dimension into the development process is an important principle of Community development cooperation policy. Environmental mainstreaming is a dynamic, gradual process. The proposed regulation will contribute to effective environmental mainstreaming in the activities funded by other (mainly geographical) Community development cooperation instruments, thus giving rise to the desired complementarity.

1.8. The proposed regulation sets the framework for the management of budget line B7-6200. This is a specific financial instrument available to the EC for complying with the above commitments.

1.9. The aforementioned instrument has evolved to finance essentially two types of activities:

- pilot schemes in developing countries

- the development of guidelines and operational instruments.

1.10. This will promote the universally accepted principle that all development projects must be sustainable.

2. Objective and resources

2.1. The appropriation in budget heading B7-6200 is intended to finance schemes aimed at supporting developing countries in their efforts to integrate the environmental dimension into their development process. The assistance and expertise provided complement and reinforce those provided under other development cooperation instruments. The resources benefit the developing country stakeholders directly and indirectly.

2.2. The activities to be carried out serve the purpose of elaborating and promoting policies, strategies, tools and technologies for the pursuit of sustainable development.

2.3. The Council intends that they should address:

- global environmental issues

- transboundary environmental issues, in particular air and water pollution

- environmental impacts related to the integration of developing countries into the world economy

- environmental impacts of macro-economic and sectoral policies in developing countries

- sustainable management and use of natural and environmental resources in all productive sectors of the economy

- conservation of biological diversity

- water-related issues

- coastal zone management

- preventing desertification

- urban environmental problems

- sustainable production and use of energy

- sustainable patterns of production and consumption.

2.4. As environmental mainstreaming is a long-term commitment, the Council suggests that the regulation apply for an unlimited period.

2.5. A breakdown is given of the costs for 1998 and 1999 under the existing regulation. A total of ECU 15 million was available for 1998 (5 million for guidelines and instruments and 10 million for pilot schemes) and a total of 16 million euros for 1999 (7 million for guidelines and instruments and 9 million for pilot schemes).

3. General comments

3.1. The Committee is pleased to note that Council Regulation (EC) no. 722/97, which applied for a limited period, is to be replaced by a regulation of unlimited duration. The integration of the environmental dimension into the development process requires a long-range approach.

3.2. The Committee would stress the need to fully integrate the environmental dimension into other Community development cooperation instruments. Although they fall outside the draft regulation under review, the Committee considers, in the light of Amsterdam Treaty Articles 174 and 177, that this principle must apply not only to Community instruments and projects but also to those of the individual Member States and those of NGOs which use EU funds.

3.3. In the Committee's view the financial resources available for the implementation of this regulation are not commensurate with the Community's obligations under international treaties.

3.4. Such limited resources make it all the more necessary to encourage, even more than in the past, the integration of the environmental dimension into regular development aid programmes.

3.5. In view of (i) the limited resources available; (ii) the possibility of also funding the elaboration of guidelines and instruments with EDF-ALA-MED funds; (iii) the difficulty for relatively small, innovative and locally-oriented pilot schemes - especially those of NGOs - to secure access to these major funds, the Committee would recommend that at least equal emphasis be placed on financing pilot schemes under this regulation.

3.6. In the Committee's view the limited resources under this regulation should be made available in such a way that they can be used effectively.

3.7. It seems inevitable that a great many objectives will be pursued through this regulation. If it is to be implemented effectively, however, the Committee considers that a limited number of priority objectives should be set every four years. If necessary they could be adjusted every two years. It is all the more important to adjust priorities periodically because the regulation is of unlimited duration and it is not until four years after it comes into force that the Commission has to submit to the European Parliament and Council an overall assessment of the operations financed, together with suggestions concerning the future of the regulation (see Article 10 of the draft regulation).

3.8. It is important for these priorities to be publicised in a clear way and in good time so that anyone wishing to submit a project is aware of the selection criteria.

3.9. The Committee notes that many projects are being submitted under the present regulation. It is to be anticipated that this will continue under the new regulation. The submission of complete project proposals entails considerable work for both applicants and assessors. Since the number of successful projects is inevitably limited, a lot of unnecessary work is carried out. The Committee recommends systematising the use of the so-called project profiles and in this way giving especially those organisations applying for pilot scheme funding the opportunity to submit outlines of proposed projects (objective, region, partners, budget, time-span) from which an initial selection of promising projects can be made. These can then be fully worked up and submitted for final selection.

3.10. A further recommendation is that contract partners and especially NGOs with which the Commission has worked successfully for a number of years be offered a programme contract to carry out a package of various small-scale projects covered by this regulation.

4. Specific comments

4.1. In the Committee's view, paragraph (2) of the preamble should mention the soil as well as the atmosphere, hydrosphere and biological diversity.

4.2. The Committee endorses Article 2.3, second indent, which states that it is possible to finance programmes for developing the institutional and operational capacity of all players in the development process; the Committee feels that the following should be added: "and for promoting cooperation between these players." In practice the lack of financing opportunities is often a bottleneck for such cooperation.

4.3. The third paragraph of Article 4(1) states that "apart from training, education and research programmes, such expenditure may as a general rule be covered only during the start-up period". It is, however, difficult to define the start-up period. Furthermore, it is often a very long time before a project really bears fruit.

4.4. Article 4(3) states that "opportunities may be sought for co-financing with other donors, especially with Member States and the international organisations concerned". The Committee proposes replacing this by: "opportunities may be sought for cofinancing with other donors, especially with the Member States, the international organisations concerned and NGOs".

4.5. The Committee endorses the provision contained in Article 6(2), namely that decisions relating to grants of more than 2 million euros for operations financed under the regulation are to be adopted under the procedure laid down in Article 7.

4.6. The Committee welcomes the margin of 20 % laid down in Article 6(3) for overruns or additional requirements. This will increase flexibility.

4.7. Article 9(1) states that after each budget year the Commission is to submit an annual report to the European Parliament and the Council. This report summarises the operations financed and evaluates the implementation of the regulation. The Economic and Social Committee recommends wide dissemination of the report, together with information on the periodic list of priorities advocated in points 3.7 and 3.8 above, and would itself like to receive a copy of the report and information. As the regulation is to be of unlimited duration, the Committee envisages using the opportunity to reassess its objectives and effectiveness.

4.8. Article 9(2) states that operations financed by the Community are to be assessed regularly. The Committee considers that these assessments should be made widely available. Assessments of projects can in fact be highly instructive, especially in the case of innovative projects.

4.9. Article 9(3) states that the Commission is to inform the Member States, at the latest one month after its decision, of the operations and projects that have been approved. The Committee considers that this should apply for all the actors mentioned in Article 3 who have submitted an application for an activity or project.

5. Conclusions

5.1. The Committee regards the proposed regulation as very important if the environmental dimension is to be properly incorporated into the development process of developing countries; but it does not regard the funding provided for its implementation as commensurate with the Community's international treaty commitments. The Committee calls attention to the discrepancy between the scant resources and the large number of applications received every year.

5.2. The Committee considers that at least equal emphasis should be placed on financing pilot schemes under the regulation since only limited funds are available and there is scope for financing the elaboration of guidelines and instruments from EDF-ALA-MED funds, while it is difficult for relatively small, innovative, locally-oriented pilot schemes (especially those of NGOs) to access major funds. The Commission can make the workload manageable for both itself and the contract partners by further developing and integrating into the decision-making process, specific instruments, such as project profiles and programme contracts (the latter with contract partners, especially NGOs with which the Commission has had long positive experiences).

5.3. In view of the Commission's duty to be accountable, transparent and reliable, and the need to pass on useful experience, all documents drawn up under this regulation should be made widely available. This applies in particular to documents concerning policy priorities, assessments of the actions funded, and annual reports. The Committee would like to receive copies of the annual reports and information on the periodic list of priorities. As the regulation is to be a permanent instrument, the Committee may review the aims and effectiveness thereof when the report is issued.

Brussels, 7 July 1999.

The President

of the Economic and Social Committee

Beatrice RANGONI MACHIAVELLI

(1) OJ C 47, 20.2.1999, p. 10.