EUROPEAN COMMISSION Brussels, 26.11.2019 COM(2019) 604 final REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL 2019 Annual Report

on the implementation of the European Union’s instruments for financing external actions in 2018 {SWD(2019) 409 final}



Global commitments Against a background of protracted conflicts around the globe, strategic disputes between world powers, climate change and digital transformation in our societies, the EU pursued multilateral solutions to shared challenges. Throughout 2018, the EU deployed every policy instrument and tool in its power, including diplomatic, security, trade, development and humanitarian assistance measures, to bring about a more peaceful, sustainable and prosperous future. The EU fosters dialogue on values and global challenges with key partners across the world. Peace and security, human rights, gender equality and support for women are central to all EU policies. This report presents the EU’s spending on international development, humanitarian assistance, foreign policy and enlargement in 2018, and shows how, as the world’s largest trading bloc and assistance donor, the EU improved millions of lives in more than 120 countries. The EU invested EUR 74.4 billion in official development assistance in 2018, with EUR 13.2 billion managed by the European Commission. That is more than the rest of the world combined, amounting to over half of this assistance globally. EU as a strong global actor The EU continued to implement its Global Strategy for Foreign and Security Policy, strengthening the defence and security of the Union and its Member States. The EU now places greater emphasis on training and expertise, under the umbrella of capacity building, in its mission around the world. As part of this approach, the first capacity building for security and development initiatives were incorporated into EU missions in the Central African Republic, Mali and Somalia. EUR 8 billion went towards promoting stability in the Sahel. The EU and the Niger G5 Sahel presidency organised the Conference of G5 Sahel countries in February, representing a milestone in preparing the Joint Force to tackle challenges including terrorism, organised crime, climate change and demographic growth. The EU promoted cybersecurity and connectivity by launching a Global Tech Panel, which helps to agree shared solutions to challenges posed by technology. The Commission’s 2018 strategy for the Western Balkans, published in February, provided a major boost to the region’s European path. There was significant progress towards the milestones of the Paris Agreement, the UN 2030 Agenda for Sustainable Development, the Iran nuclear deal and the UN global compact for migration. The EU also took a leading role in promoting free and fair trade and in supporting the reform of the World Trade Organization. Engagement in the UN’s High-level Political Forum and the Financing for Development Forum was a high priority, and the EU announced a renewed EU-UN partnership in development. The EU also showed strong support for reforms to the UN development system. Implementing the 2030 Agenda and the European Consensus on Development The UN 2030 Agenda for Sustainable Development is at the heart of the EU’s international cooperation and development policy, and was adopted by all UN Member States in 2015. It is a blueprint for peace and prosperity for people and the planet, and features the 17 Sustainable Development Goals (SDGs). The European Consensus on Development of 2017 is a shared vision and framework for development cooperation action for the EU and its Member States. It aligns the EU’s development policy with the 2030 Agenda. The Consensus contributes to the objectives and principles of EU external action, as laid down in the Lisbon Treaty, and supports the Global Strategy for Foreign and Security Policy. Africa-Europe Alliance In 2018, the EU launched the Africa-Europe Alliance for Sustainable Investment and Jobs. This approach represents a step change for the EU’s partnership with Africa. The Alliance builds on the African Union (AU)-EU Summit commitments of 2017 by boosting investment, attracting more private investors, extending trade, improving the business climate, and supporting education and skills for employment. The Alliance is a radical shift away from a donor-recipient relationship to a partnership of equals. Multiannual financial framework As part of preparations for the next multiannual financial framework, the Commission adopted its proposal for the Neighbourhood, Development and International Cooperation Instrument (NDICI) in June 2018. The NDICI will streamline the EU’s external action architecture and make financing instruments more flexible, coherent and effective. It will also channel the largest share of the EU’s external action funding, with a budget of EUR 89.2 billion for 2021–2027. Negotiations with the Council and European Parliament are ongoing. Working better together with EU Member States

The EU and its Member States are working together to adopt a European approach to development cooperation, under the European Consensus on Development and the SDGs. The main features are joint programming, a joint results frameworks and joint implementation. By 2018, 23 joint programming documents existed, and joint programming was under way in another 17 partner countries. External Investment Plan The External Investment Plan (EIP) is an ambitious initiative to boost investment across Africa and the Neighbourhood region, benefiting Europe and partner countries alike. Furthermore, it aims to contribute to the SDGs and expands sustainable public and private investments in economic and social development, with a special focus on decent work. With a contribution of EUR 4.5 billion from the EU, the EIP is expected to leverage up to EUR 44 billion of investments by 2020. Policy coherence for development The EU considers the objectives of development cooperation across all policies including the 2030 Agenda, through a ‘policy coherence for development’ process. This minimises contradictions and duplication between policies while increasing the effectiveness of development cooperation. Particular attention will be given to coherence between the EU’s external development policies on the one hand, and the EU’s industrial and SME policies on the other. Global reach The Global Strategy on Foreign and Security Policy guides the EU’s response to global challenges. This section presents how the EU strengthened its position as a united and reliable partner. It also summarises how the EU worked to reduce poverty and ensure sustainable development, while promoting democracy, peace and security. Africa The EU and Africa focused on implementing the outcomes of the 2017 AU-EU Summit, with the EU supporting the AU’s Agenda 2063 and the continent’s economic integration through the African Continental Free Trade Area (ACFTA). All of this was brought together with the launch of the Africa-Europe Alliance. There was also progress on promoting international ocean governance and on a global pact for the environment, which will identify gaps in international environmental law and environment-related instruments. Many initiatives were pursued at continental, regional and national level (e.g. a donors’ conference to support the transition to stable democratic government). Negotiations on a renewed partnership with the group of African, Caribbean and Pacific (ACP) states continued, in efforts to succeed the Cotonou Agreement in 2020. Enlargement region The Commission’s Western Balkans strategy of February 2018 provided a major boost for the region’s European path and reconfirmed the Western Balkans’ future as an integral part of the EU. At the EU-Western Balkans summit in Sofia in May 2018, EU leaders reaffirmed their unequivocal support for the region’s European perspective, and the Western Balkan partners recommitted to this perspective as their firm strategic choice. The Commission adopted its annual enlargement package in April 2018, and recommended opening accession negotiations with Albania and North Macedonia. The EU Facility for Refugees in Turkey continued to support both refugees and host communities. The first tranche of EUR 3 billion in funding is being spent on 72 projects. In 2018, the Commission began committing a further EUR 3 billion for 2018–2019. European Neighbourhood The EU’s European Neighbourhood Policy (ENP) continued to support and foster stability, security and prosperity in its Neighbourhood, and to develop strong partnerships with countries to the east and south. In the east, implementation of the 20 Deliverables for 2020 progressed well in 2018. Work continues with the six partner countries, notably on judicial reform and ensuring an enabling environment for civil society. Georgia, Moldova and Ukraine worked on implementing their Association Agreements, while the Commission adopted a single support framework for Azerbaijan (2018–2020) and a special measures package for Belarus. Humanitarian support to Ukraine continued. The Commission also started implementing the EU-Armenia Comprehensive and Enhanced Partnership Agreement (CEPA) of November 2017. In the south, the EU continued to promote a socio-economic and rule of law agenda throughout the region with all partner countries while pursuing regional integration in the Mediterranean region. The EU also addressed the humanitarian and political challenges linked to various crisis, in particular in Syria and Libya. This involved supporting Syrian refugees and host communities (notably in Lebanon, Jordan and Turkey) through the EU Regional Trust Fund in Response to the Syrian Crisis. While through the North of Africa window of the EU Emergency Trust Fund for Africa, the EU has contributed to thousands of assisted voluntary returns and evacuations from Libya as well as concrete measures of protection of vulnerable persons affected by the conflict while contributing to measures to tackle irregular migration. The EU and Tunisia agreed strategic priorities for 2018–2020 and the EU adopted a single support framework for Algeria (2018–2020). The first drafts of the Partnership Priorities for Palestine and Israel were prepared, and action plans were extended by three years. Asia, Central Asia and the Pacific At the 2018 Asia-Europe Meeting, leaders agreed to improve cooperation on trade, security and the environment. They renewed their support for the rules-based international order and an open world economy. Central Asia is poorly connected to the main population centres in Europe and Asia, and the free flow of people, goods, services and ideas is limited. Physical infrastructure is generally of poor quality and digital connectivity is weak. The EU’s 2018 Connecting Europe and Asia strategy aims to improve connectivity across Central Asia. The strategy goes beyond infrastructure, and includes steps to tackle regulatory barriers to movement.

The EU showed its commitment to an active EU security presence and engagement with Asia at bilateral, regional and global levels, and remained committed to ongoing diplomatic efforts on the denuclearisation of the Democratic People’s Republic of Korea, both through talks with partners and sanctions. In Myanmar, the EU continued to assist Rohingya refugees. The EU also supported peace efforts in Afghanistan. The EU supported activities to promote the blue economy and conservation as part of the Pacific-EU Marine Partnership, which aims to strengthen the Pacific islands’ resilience against climate change. Latin America and the Caribbean The EU, Latin America and the Caribbean held a ministerial meeting in July 2018 and continued their work to shape the future partnership into a diversified model, emphasising trade, investment, research, innovation, education, the digital agenda and shared values. The EU’s Regional Facility for Development in Transition responds to the development challenges for countries transitioning to higher levels of income. The EU continued to support the implementation of the peace agreement in Colombia, while monitoring the socioeconomic and political climate in Venezuela, and worked hard to modernise Association Agreements with Chile and Mexico. The EU also worked to conclude the Association Agreement with Mercosur. Environmental work under the EU-CELAC (Community of Latin American and Caribbean States) common research area focused on working together to transform bio-waste, promote research for sustainable cities and arrange exchange opportunities for scientists. Sustainable Development Goals Throughout 2018, the EU supported the implementation of Agenda 2030 and its goals, which provide a common approach to development policy. The following pages summarise the EU’s contribution to achieving the SDGs, including some major results from EU-funded actions and partnerships. #1 No poverty Extreme poverty is falling, but not fast enough. Without widespread policy change, 480 million people will continue to live in extreme poverty by 2030. The EU continued its work to eradicate the many root causes of poverty, including inequality and inadequate education, health, and social protection. In particular, the EU helped weaken the link between poverty, conflict, fragility and forced displacement. More than 68 million people were displaced in 2018, and the EU sought to help prevent forced displacement from becoming long-term, while helping displaced people reduce their dependence on assistance. The EU runs 270 budget support programmes in 90 territories to help eradicate poverty. These are fully aligned with partner countries’ own development policies, priorities, objectives and country systems in the context of SDG implementation. EU budget support increasingly focuses on low-income countries. This includes helping fragile states rebuild basic state functions and improve their resilience. As a lead contributor to two new UN global compacts on refugees and on migration, the EU played a key role in mobilising the international community to address poverty’s root causes. 1.5 million migrants, forcibly displaced people and members of host communities received EU assistance (2018). #2 Zero hunger Severe hunger is on the rise after years of decline, largely due to conflicts, natural disasters and climate change. The EU has increased financial assistance for food security by 14.7 % (2014–2018) and is on track to fulfil its nutrition commitments, with 71 % of the EUR 3.5 billion target already allocated, as a result of which 4.7 million children will have been averted from stunting by 2025. The EU and its Member States have been working with partners to address all forms of hunger, partly through promoting sustainable and resilient agriculture, which can be powerful drivers of growth, job creation and poverty reduction. In 2018, the EU mobilised EUR 140 million to promote sustainable agriculture. Over 12 million people affected by food insecurity accessed EU support (2018).

#3 Good health and well-being Healthier societies are happier, more productive and more prosperous. That is why the EU and its Member States promote health in all policies and work across sectors to improve the quality, coverage and affordability of healthcare. The EU continued to deliver the EUR 2.6 billion allocated to health measures for 2014–2020. The Commission has pledged EUR 475 million to the Global Fund to Fight AIDS, Tuberculosis and Malaria for 2017–2020. By 2018, this had helped put 11.5 million people on life-saving HIV treatment, detect and treat 5 million cases of tuberculosis, distribute 197 million mosquito nets and treat 108 million cases of malaria. Furthermore, the Commission provided a grant to the World Health Organization of EUR 28 million for 2016–2018, in support of the Universal Health Coverage Partnership programme to improve donor coordination, aid effectiveness and health systems in 28 partner countries. Almost 64 million one-year-olds were fully immunised with EU support (2018). #4 Quality education Education is crucial for independent, healthy and sustainable living. The EU and its Member States are the biggest contributors to the Global Partnership for Education, which strengthens basic education provision in poor and crisis-affected countries. The EU added an additional EUR 100 million to an existing pledge of EUR 375 million for 2014–2020. In May 2018, the Commission issued a communication on education in emergencies and protracted crises, calling for a coordinated approach in the delivery of humanitarian assistance and development assistance. Education in emergencies, and the commitment to leave no one behind, remained political priorities. In 2018, the EU increased its budget for education in emergency to 8 % of humanitarian assistance (more than EUR 90 million). The EU continues to help partner countries boost individuals’ education and employment prospects through Erasmus+. Between 2015 and 2017, over 120 000 higher education students and university staff moved between Europe and partner countries under Erasmus+. In 2018, the first European School in the Eastern Partnership was established in Tbilisi, as part of broader efforts to address the educational needs of young people in the European Neighbourhood. More than 10 million children were enrolled in education with EU support (2018). #5 Gender equality Women and girls continue to suffer discrimination and violence in every area of the world. In 2018, the Commission neared its target to promote gender equality across 85 % of its projects by 2020. Achievements include the EU-UN Spotlight Initiative to eliminate gender-based violence, with a budget of EUR 500 million (2017–2019), and eight new programmes against gender-based violence in Africa (EUR 220 million). Through the Union for the Mediterranean, the EU established a system to monitor progress on gender equality in the Southern Neighbourhood. Improving gender equality could add EUR 10.6 trillion to the global economy by 2025. To help ensure all citizens can fulfil their full potential regardless of their gender, the EU supported new projects to promote women’s employment, protect female refugees, and support women and girls in conflict regions. Three Partnership Instrument actions also helped increase employers’ commitment to gender equality. New activities in non-EU countries, supported by the Instrument contributing to Stability and Peace (IcSP), also promoted the role of women in peace efforts. EUR 500 million went towards eliminating violence against women and girls around the world under the Spotlight Initiative with the UN. #6 Clean water and sanitation The planet is running out of clean water.

Pressure on water sources has been increasing for decades because of population growth, industrialisation and other factors. The EU is the biggest donor to humanitarian action in the water, sanitation and hygiene sector, allocating around EUR 200 million per year to improve access to safe water during humanitarian crises. In 2018, the Council conclusions on water diplomacy called on EU institutions and Member States to prioritise this issue. The EU responded by investing in infrastructure for the most vulnerable, promoting sustainable water management, involving water users’ in decision-making, and supporting expertise exchange. 723 000 people accessed cleaner water or improved sanitation facilities with support from the EU (2018). #7 Affordable and clean energy Energy is central to most of the world’s challenges, including jobs, security, climate change and food production. In 2018, the African Union and the EU launched the High-level platform for Sustainable Energy Investments to develop the sector, and the EU continued to support the Africa Renewable Energy Initiative (AREI) with a contribution of EUR 1.5 billion. The AREI is set to achieve at least 10 gigawatts of new and additional renewable energy generation capacity by 2020, and at least 300 gigawatts by 2030. Energy security and energy efficiency remained priorities for the Eastern Partnership, with the EU4Energy programme committing EUR 16.7 million to its sustainable investment climate and value chains programme. The High-Level Energy Efficiency Initiative also continued to expand energy efficiency reforms and investment in the neighbourhood and enlargement regions, while the EU Partnership Instrument supported SDG #7 through actions on affordable and clean energy. Over 16.8 million people gained access to electricity with EU support (total for 2014–2018) #8 Decent work and economic growth Decent employment opportunities and sustainable economic growth are essential to global prosperity. In 2018, the EU committed EUR 16.7 million to the sustainable investment climate and value chains programme, which promotes financial inclusion and a better investment environment in partner countries. A further EUR 19.2 million went towards better working conditions and environmental standards in the garment industry. In the Western Balkans, the EU adopted a new regional action, committing EUR 19.8 million to helping its partners implement their economic reform programmes, to developing a competitive private sector and to implementing a regional economic area. In 2018, the EU launched a ‘vocational education and training toolbox’ to strengthen links between vocational education and training and the private sector in developing countries. It also launched an initiative to boost women’s entrepreneurship and economic empowerment. Over 1.1 million people accessed financial services with support from the EU (2018). #9 Industry, innovation and infrastructure With more than half of humanity now living in cities, mass transport, renewable energy sources and digital technologies are more important than ever.

The EU continued to allocate funds for multi-modal transport corridors (transit routes supporting several modes of transport and pedestrian access). In 2018, the EU also contributed EUR 91 million to improve transport for rural populations. This funding helped to attract investment of EUR 688 million to interconnect Africa and enhance transport links for people in rural areas. The ACP-EU Partnership supported more than 350 research centres, higher education institutions and innovation partners. In the Western Balkans, a connectivity package was delivered, comprising 11 transport projects, totalling EUR 190 million in grants and leveraging investments of EUR 1 billion from partner international financial institutions in the Western Balkans Investment Framework. EUR 200 million was mobilised by the EU to increase the use of digital technologies (2018). #10 Reduced inequalities Global poverty levels are falling but major inequalities persist, including pay gaps and unequal access to services. Income inequality remains high in many countries, particularly in the developing world. The countries with the worst income inequality, as measured by the Gini index, are in Latin America and sub-Saharan Africa. Efforts focused on reducing income inequality, increasing zero-tariff access for exports from the least developed countries and developing countries, and assisting the least developed countries and small island developing states. However, progress will need to accelerate to address growing disparities within and between countries. In 2018, the EU continued working with partner countries on actions to address all forms of inequality. The focus included improving social protection systems, supporting universal access to quality public services and pursuing anti-discrimination policies and progressive fiscal reforms. For example, at the end of 2018, 187 projects (worth EUR 3.6 billion) to improve migration management and socioeconomic development had been approved in the Horn of Africa, Lake Chad, North Africa and Sahel regions through the EU Trust Fund for Africa. Over 1 million people benefited from vocational or skills training with EU support (2013–2018). #11 Sustainable cities and communities Cities contribute 80 % of the world’s gross domestic product and 70 % of carbon emissions. This goal focuses on, for example, sustainable and affordable housing and transport, reducing the environmental impact of cities, and connecting cities with rural areas. The participatory slum upgrading programme is a joint effort by the EU, ACP states and UN-Habitat. The programme will help improve 2 million lives and involves 160 cities. In Tunisia, through three consecutive programmes, the EU and its partners helped to rehabilitate 180 urban informal neighbourhoods. The Commission is also a founding partner of the Global Covenant of Mayors, which is predicted to cut yearly CO2 emissions by 1.3 billion tons by 2030. In a 2018 report, the Commission stressed the need to address the challenges and opportunities of urbanisation. The Commission also launched a call for proposals to support around 20 city-to-city partnerships on sustainable urbanisation in partner countries. Furthermore, the EU’s international urban cooperation programme will strengthen climate and urban diplomacy, as part of the Urban Agenda and the Paris Agreement. 91 countries had climate change or disaster strategies under development or in place with EU support (2018). #12 Responsible consumption and production Citizens want to know that the goods and services they buy have been produced responsibly. In their engagement with businesses, the EU supports third country action on sustainable consumption practices and the circular economy, and promotes private sector action. EU support covers many sectors and value chains, such as textiles, minerals, agricultural commodities, waste and tourism.

The promotion of sustainable consumption is embedded in all relevant EU external action financing instruments. In 2018, 6 500 micro, small and medium-sized enterprises implemented sustainable consumption and production practices with EU support. This includes the Development Cooperation Instrument, which finances initiatives such as SWITCH to Green, the European Development Fund, the Partnership Instrument and the IcSP. More than 150 green business projects, worth over EUR 250 million, have been funded under the SWITCH to Green regional programmes in Asia, Africa and the Mediterranean since 2008, helping to improve practices in approximately 90 000 MSMEs and sustaining 350 000 jobs. #13 Climate action Climate change is a defining issue of our time. The EU has committed to allocating 20 % of its budget in support of climate-relevant action during 2014–2020. This target applies to its external action as well. Here, the EU helped its developing partner countries meet their obligations under the Paris Agreement by focusing on climate change mitigation and adaptation. The EU has systematically integrated climate change considerations into the different sectors of its cooperation portfolio. Approximately 55 % of the EU’s contributions to climate action during 2014–2017 were the result of its incorporating climate action into its agriculture, food security and energy policies. In the Eastern Neighbourhood, the EU4Climate programme continued to support the development and implementation of climate-related policies by Eastern Partnership countries, helping to cut emissions, improve climate resilience and deliver on Paris Agreement commitments. Established within the framework of the UNFCC (United Nations Framework Convention on Climate Change), the Green Climate Fund, which aims to assist developing countries in adaptation and mitigation practices to counter climate change, has implemented 111 projects and reached 310 million beneficiaries, as of August 2019. 18.4 million tonnes of greenhouse gas emissions were avoided with EU support (total for 2014–2018). #14 Life below water Human activities, and their impact on the rate of climate change, are reducing biodiversity, damaging weather patterns and raising sea levels. The EU committed EUR 10 million to the Southeast Asian Coral Triangle in 2018. Projects will support ecosystem management, climate change adaptation and the expansion, administration and reinforcement of the marine protected areas network and small-scale sustainable fisheries. A new support programme with ACP countries, worth EUR 35 million, aims to protect and manage biodiversity in developing countries. EUR 17 million will go to helping Pacific countries to build waste management programmes and to address health, marine litter and biodiversity challenges. In the Mediterranean, the GreenMed III programme (EUR 48 million) was adopted to promote resource efficiency and sustainable consumption and production, as well as clean-up operations. 2 700 km2 of marine areas were protected with assistance from EU initiatives (2018). #15 Life on land An alarming decline in biodiversity, paired with the severe degradation of terrestrial ecosystems, has major consequences for humanity . In 2018, the EU continued to deliver on its commitments on the sustainable management and use of natural resources. Under the forest law enforcement, governance and trade action plan, the EU helped 24 countries improve sustainable forest management, enhance legal systems, build national and local capacities, strengthen civil society organisations (especially those protecting indigenous people) and boost private-sector compliance with national regulations. The EU committed EUR 43.5 million to tackle forestry and wildlife crime, while continuing its work to protect biodiversity. Nearly 7 million hectares of ecosystems were protected thanks to EU initiatives (2018).