COMMISSION OF THE EUROPEAN COMMUNITIES
Brussels, 12.09.2002
COM(2002) 490 final
ANNUAL REPORT 2001 FROM THE COMMISSION
TO THE COUNCIL AND THE EUROPEAN PARLIAMENT
ON THE EC DEVELOPMENT POLICY AND THE IMPLEMENTATION OF THE
EXTERNAL ASSISTANCE
2TABLE OF CONTENTS
FOREWORD bytheBoardofEuropeAid Co-operationOffice..............................................4
Introduction................................................................................................................... ........6
1. TheExternalAssistance management reform, a year ofchallenges...........................81.1. TheReformprocess..................................................................................................81.2. Improving Programming...........................................................................................91.3. Evaluation..............................................................................................................111.4. Results-oriented Monitoring...................................................................................111.5. DeconcentrationofProject Management to Delegations.........................................131.6. Coherence, Co-ordinationand Complementarity.....................................................152. PROGRESS TOWARDS THE DEVELOPMENT GOALS....................................202.1. TheMillenniumDevelopment Goals......................................................................202.2. Povertyreduction...................................................................................................242.3. Measuring EffectivenessThroughResultsIndicators..............................................262.4. SectoralTargeting intheProgramming Process......................................................282.5. PolicyInitiatives inECPriorityAreas....................................................................302.6. Mainstreaming theCross-cutting Themes...............................................................373. IMPLEMENTATION : HORIZONTALINSTRUMENTS.....................................443.1. European initiative for democracyand HumanRights............................................443.2. FoodSecurity.........................................................................................................493.3. Health, AIDS and Population..................................................................................533.4. Fighting against drugs............................................................................................553.5. Linking relief, rehabilitationand development........................................................563.6. Environment...........................................................................................................593.7. Co-financing NGOs ................................................................................................61
4. Implementation: TheRegions.................................................................................654.1. Countriescovered bytheECExternalAssistance...................................................654.2. South-EasternEurope:TheBalkans........................................................................674.3. EasternEuropeand CentralAsia............................................................................904.4. SouthernMediterraneanand MiddleEast.............................................................1074.5. Africa, Caribbeanand Pacific(ACP)....................................................................125
34.6. ASIA....................................................................................................................159
4.7. LatinAmerica.......................................................................................................1835. Feature: Results-oriented Approachto Development...........................................2065.1. CountryPerformanceand Project Performance.....................................................2065.2. Monitoring Results: CountryPerformance............................................................2075.3. Project Results: Results-oriented Monitoring........................................................2155.4. Conclusion...........................................................................................................2216. Financialtables.....................................................................................................2237. Annexes...............................................................................................................2307.1. Harmonisationofcontract and financialprocedures..............................................2307.2. ExternalAid and “RAL”.......................................................................................2317.3. EvaluationActivities............................................................................................2377.4. Audits...................................................................................................................24 1
7.5. Innovation............................................................................................................2427.6. Relationswithother InternationalDonors.............................................................2447.7. Transparencyand visibility...................................................................................2447.8. ECAssistance not covered bytheReport .............................................................245
4FOREWORD
2001 was a year of fundamental reform for the management of EC external assistance with
the aim of improving the speed, quality, impact and visibility of projects and programmes
throughoutthe world.
On 1 January 2001, the EuropeAid Co-operation Office was created bringing together in a
single organisation responsibility for managing the whole life-cycle of projects from
identification to evaluation, while responsibility for programming was consolidated within
DG Development and DG Relex. A new Inter-service Quality Support Group was set up to
contribute to improvements in programming and the Commission presented 112 new Country
Strategy Papers, establishing coherent multi-annual frameworks for defining relations with
thirdcountries.
Inevitably for a reformof this scale, the full effects willtake time. However, there are already
some positive results, for example interms of improved budget execution. The recent meeting
of the OECD Development Assistance Committee (DAC) has recognised these efforts: “ The
European Community has substantially improved its development policies and strategies
since the last review in 1998…” This statement is part of the summing up of the DAC
findings. It encouragestheCommissiontofollowupthepaceofreform.
With respect to development policy, the EC made significant progress in strengthening the
poverty focus of its programmes, taking concrete measures to support the achievement of the
Millennium Development Goals. This included the adoption of an ambitious action
programme for EC development policy. Within this agenda, the Commission also adopted a
far-reaching PlanofActionon fighting poverty-related diseases inthe developing world.
Coherence between development policy and other policies was also strengthened. The
European Council in Gothenburg agreed on a strategy to integrate environment and
sustainable development into EC development policy. And the launchofa new trade round at
Doha emphasised the links betweentrade and development.
The 2001 Annual Report responds to requests from both the Council and the European
Parliament that it should be comprehensive, based on solid data and results-oriented. It
represents a positive step inthis directionthat willbe further developed inthe future.
This Report provides information on programmes implemented and assesses achievements on
the ground : frompromotion ofHuman Rights in the Balkans to water management in Asia ;
from health in Africa to training and education in Latin America; from rapid mobilisation in
Afghanistantoinstitutionbuilding inRussia.
As a new element this Annual Report contains a feature article. The Commission, as most
other donors, is moving increasingly towards a more result oriented development assistance.
The Feature describes work in progress, and presents “where we are” with developing
effective and reliable ways of measuring the impact ofour externalassistance.
We stillface huge challenges. Butthe objectives are clear – improving the performance of EC
assistance and contributing to securityand prosperityfor all.
Chris Patten Member of the Commission responsible for External Relations
ChairmanoftheBoardoftheEuropeAidCo-operationOffice
5PoulNielson Member of the Commission responsible for Development
Chief Executive Officer ofthe Boardofthe EuropeAid Co-operation Office
Günther Verheugen Member of the Commission responsible for Enlargement
MemberoftheBoardoftheEuropeAidCo-operationOffice
Pascal Lamy Member of the Commission responsible for Trade
MemberoftheBoardoftheEuropeAidCo-operationOffice
PedroSolbesMira Member of the Commission responsible for Economy and Finances
MemberoftheBoardoftheEuropeAidCo-operationoffice
6INTRODUCTION
This report summarises the first year of EuropeAid Co-operation Office’s implementation of
EC external assistance activities1. Its coverage is broad , from overall progress towards the
MillenniumDevelopment Goalsto individualexamples ofhow EC moneyhas beenspent and
what it has achieved. The EU is the largest donor of external assistance in the world, and EC
spending makes up roughly 10 % of world ODA. This report accounts for the €9.7 billion
committedand €7.7billionpaid bythe EC in2001.
Vitalto the success of these activities is the reform of the management of external assistance.
This report itself is a key output of the reform – bringing greater transparency and
accountability to EC policy and actions in this area. By providing a consolidated account of
all geographical and horizontal programmes, this report replaces a number of programme-
specific reportsthat have beenpublished inthe past.
Progress made in priority areas for reform – improving programming, reunifying the project
cycle under one roof and increasing responsibility for delegations on the ground – is detailed
in Chapter 1. The reformprocess, launched in May 2000, still has a wayto go in achieving its
objectives, but improvements are already evident. For example, for the first time since 1990,
therewasareductioninthe levelofoutstandingcommitmentswaitingto bepaid.
This first section also underlines the importance of coherence, co-ordination and
complementarityacross EC policies designed to promote development, poverty reduction and
integration into the world economy. The challenge of coherence is to find the right mix of
policies for each region and country using development assistance, humanitarian assistance,
the Common Foreign and Security Policy, trade-related technical assistance, Human Rights,
environment and so on. Improved programming tools are designed to ensure a coherent
overallframework. Co-ordinationwithother donors and ensuring complementarityofpolicies
and activities are also essential to effective external assistance. The report describes the steps
the EC has taken in this area with Member States, with the UN, with the Bretton Woods
institutions and with other donors.
The Millennium Development Goals, agreed by the international community in September
2000, provide a common framework for focusing and measuring development progress.
Chapter 2 of this report outlines global achievements towards these goals, and places EC
external assistance activities in the context of this framework. It focuses on EC priority areas
such as health and education and on activities designed to ensure that common themes like
Human Rights and the environment are duly incorporated into projects and programmes
acrossthe board.
The instruments designed to ensure that horizontal policy priorities such as food security and
the fightagainst drugs, as wellas those mentioned above, are translated into activities in these
areas, are set out in chapter 3. Details are given on individual projects carried out in 2001, as
wellas budget allocations and prioritisation byregion.
1Assistance to candidate countries is not covered by this report. For details of the Phare, Ispa and Sapard
programmes, please see their annual reports, which are published under the following addresses:http://www.europa.eu.int/comm/enlargement/pas/phare/publist.htm
http://www.inforegio.cec.eu.int/wbpro/ispa/ispa_en.htm
http://www.europa.eu.int/comm/enlargement/pas/sapard.htm
For humanitarian AidseeECHO’sannualreporton:http://europa.eu.int/comm/echo/en/publicat/publications.htm
7EC regional programmes are covered in Chapter 4. Activities in the Balkans, Eastern Europe
andCentralAsia, theMediterranean, African, Caribbeanand Pacific countries, Asia and Latin
America are presented under common thematic headings reflecting development priorities in
EC spending. This means that comparison can be made easily between regions on for
example rural development or transport. ECHO’s activities as well as EIB loans can also be
found inthis Chapter.
Chapter 5discusses a results-oriented approach to development. Based upon CountryStrategy
Papers and indicators, it explores criteria for monitoring country performance. A pilot
exercise ona results-oriented monitoring systemofdevelopment projects is also described.
A full set of financial tables makes up Chapter 6. These include a breakdown of figures into
the categories defined bythe OECD’s Development Assistance Committee.
Finally, the annexes give a detailed account of activities related to the reform of the
management of EC external assistance. It sets out progress in harmonising financial
procedures, both internally and with other institutions. It also gives details activities in 2001
in clearing the backlog of payments, audit activities, the activities of EuropeAid’s Innovation
Unit, relations with other organisations and transparency and visibility.
The Commission is committed to seeing through the reform, allowing it to take root and
ensuring that it meets its objectives. This report marks outthe steps made in 2001 towards this
end.
81. T HEEXTERNAL ASSISTANCE MANAGEMENT REFORM ,AY EARO FCH ALLENG ES
This chapter highlights progress during 2001 with the reform of the management of EC
external assistance, launched in May 2000. The management reformprocess is a natural point
of departure for the annual report, since it affects all aspects of the EC’s external assistance,
which are described in more detail in the following chapters. The reform of the EC’s
development policy, launched in November 2000 and taking place in parallel with the
management reform, is covered inchapter 2.
1.1. The Reform process
When the present Commission took up office in September 1999, it was confronted
withanalarming situationregarding the implementationofaid to third countries. The
relevance and quality of Community programmes were the subject of increasingly
explicit criticism, and the Commission’s image and credibility were suffering a
serious decline in the eyes of the beneficiary states, the Member States and its
partnersamong the multilateralinstitutions.
On 16 May 2000, the Commission launched a programme of reform of the
management ofexternalassistance2, the principalobjectives ofwhichare to:
•Improve the qualityofprojects and programmes;
•Reduce the time needed for implementation;
•Ensure that procedures for financial, technical and contractual management
conformtothe highest internationalstandards;and
•Increase the impact and visibility of the European Union’s (EU’s) external
assistance.
The reform process has been accompanied by the search for an improved match
between political priorities and budgetary allocations. At the informal Evian
General Affairs Council, 2-3 September 2000, and the General Affairs Council
(GAC) meeting on 9 October 2000, EU Foreign Ministers underlined that the
coherence of the EU’s external actions should be reinforced. They also stressed in
the General Affairs Councilof January2001 that the objectives of EC actions should
be translated into concrete commitments, and that the synergy between EC actions
and those of Member States should be improved in order to make the EU’s external
actions more effective.
A number of key instruments have been identified to achieve the objectives of
reform. New planning and programming tools for the EC’s development co-
operation, in particular country strategy papers, have been drawn up and approved
during 2001. These are the main strategic management instrument for EC aid (see
section 1.2. of this chapter). Management of evaluations has been improved. Among
other things, impartiality has been reinforced and lessons from evaluations will be
2SEC(2000)814 of 16 May 2000 – Communication from the ‘Relex’ Commissioners: Mr Patten (External
Relations), Mr Nielson (Development), Mr Verheugen (Enlargement), Mr Lamy (Trade) and Mr Solbes Mira
(Economic&MonetaryAffairs)
9fed systematically into the decision-making process, as well as into the design and
implementation of projects and programmes (Section 1.3.). Linked to improved
evaluations is the development of a results oriented monitoring system for projects
and programmes (section 1.4.). This is a first step, but a very important part of the
reform. The Commission has also embarked on devolution of project and programme
management to the Commission Delegations (section 1.5.). 18 of the 21 delegations
selected for the first phase are now deconcentrated. Preparation for the second wave
(26 delegations) is well advanced, and most of these should be operating in a
deconcentrated way early in the second semester of 2002. Finally, Section 1.6
explains how the Commission has taken on the challenge of improving coherence,
coordination, and complementarity, the ‘3Cs’. These issues are very much linked to
the countrystrategypaper process.
1.2. Improving Programming
1.2.1. Country/Regional Strategy Papers
Programming follows priorities set in Country/Regional Strategy Papers (CSP/RSP)
which set out a ‘strategic framework’ for the EC’s co-operation priorities in a given
country or region3. This is the first time that the Commission has set up a coherent
framework for its relations with third countries covering both development assistance
and other essential relevant Communitypolicies (the ‘policy mix’).
In 2001, the Commission began the process of establishing Country and Regional
Strategy Papers for partners in all regions covered by the different regulations: for
ACP (Africa, Caribbean and Pacific), ALA (Asia and Latin America), CARDS (for
the Balkans), MEDA (for Mediterranean), TACIS (for Eastern Europe and Central
Asia). These strategies have been developed in collaboration with national
governments, Member States, other bilateral multilateral donors and, wherever
possible, with representatives of civil society4. Over 110 country and regional
strategies are either completed or well advanced in the preparation process. It is
estimated that all will be finalised before the end of 2002, and published on the
websites:http://europa.eu.int/comm/external_relations/sp/index.htmand
http://europa.eu.int/comm/development/strat_papers/index_fr.htm
1.2.2. The iQSG
As part of the reform process, an inter-service Quality Support Group (iQSG) was
established in January 2001. Its main task has been to assess draft Country and
Regional Strategy Papers and Indicative Programmes to ensure a consistently high
quality. In order to achieve maximum impact, the iQSG intervenes at a relatively
earlystage inthe programming process. It has so far screened over 110 programming
documents. The iQSG has also drafted Guidelines on the implementation of the
Common Framework for Country Strategy Papers and organised four training
seminars on programming. Finally, the iQSG has established a website on the
Commission’s intranet to improve the internal communication between all those
involved in the programming process.
3SEC(2000)814, SEC(2000)1049 of 15 June 2000, and Conclusions of 10 November 2000 Development
Councilhttp:/www.consilium.eu.int/Newsroom/newmain.asp?lang=1
4Consultation ofCivil Societyisan obligation under article2 oftheCotonou Agreement.
10The main yardstick for iQSG assessment has been the Common Framework for
Country Strategy Papers adopted by the Council. In addition to commenting on
format, style, presentation and general readability, the iQSG has endeavoured to
focus oncertaincore aspects:
•The quality ofthe assessment of the potential for development, the needs and the
constraints thwarting the development process;
•The coherence between the analysis and the proposed Community response
strategy, checking whether EC interventions correspond to key medium term
development challenges;
•The poverty focus of the proposed strategy as well as coherence with other EC
policyobjectives;
•The focus / degree of concentration; The degree of complementarity between EC
support and that ofother donors, inparticular EU Member States;
•The conditions under whichsupport is granted;
•The definition of indicators designed to monitor country performance towards
economic growth and povertyreduction;
•The extent to which all external assistance provided by the Community to the
country concerned is covered (coherence between country allocation and
horizontalbudget lines);
•The consideration given to coherence between development policy and other EC
policies relevant for the partner country/ region (‘policy mix’).
Based on the findings of the iQSG, the Commission considers that a qualitative leap
in EC programming of external assistance has been achieved. The iQSG found that,
overall, the documents it considered answered most of the requirements set out in the
CSP Framework. Mainweaknesses were highlightedto those involved in drafting the
papers, sothat theycould make necessarychanges.
There is still room for further improvement in programming . With this is mind, the
Commission will undertake an analysis of the CSP process and will present its
findings in a report to the Development Council in November 2002. This report will
also cover proposals for further improvements in the programming process in
advance ofthe next review ofCountryStrategyPapers.
1.2.3. Reunification of the Project Cycle and Creation of the EuropeAid Co-operation
Office
On 1st January 2001, the geographic Directorates-General (DG External Relations
and DG Development) took charge of programming and strategy, whilst the new
EuropeAid Co-operationOffice (EuropeAid) took onresponsibility for the remainder
of the project cycle (from identification of projects to ex-post evaluation). This
reorganisation has led to a corresponding transfer of staff and responsibilities. An
Inter-service Agreement was signed in June 2001, which clarifies the roles and
responsibilities of the three Directorates General most closely involved in the
management ofexternalassistance.
111.2.4. Improving Financial Management and Performance
The first effects of the management reform process, in terms of procedures and
financial management and performance, became visible during 2001. These
included:
•An improvement in the overall budget execution performance, including an
increase of20% inpayments compared to 2000.
•The profile ofbudgetarycommitments showed a more even distribution across the
financial year (52 % of budget executed during the last quarter compared to an
average of68 % over the period 1998 – 2000)
•For the first time since 1990, there was a reduction in the level of outstanding
commitments remaining to be paid (RAL). This reduction was 3 %. The number
of years of payments necessary to clear up the RAL decreased from 4.12 years at
the end of2000 to 3.66years at the end of2001.
•Areduction inthe number ofindividualbudget-lines (14 %), compared to 2000;
•The implementation of new, simplified contracting procedures (which reduced in
number from 46 to 8) has been speeded-up through the production of a practical
guide;and
•The functions of 48 Technical Assistance Offices dismantled during 2001 were
internalised.
1.3. Evaluation
As part of the reform , evaluation of external assistance is being strengthened and
better integrated into decision-making . The impartiality of the evaluation function
has also been assured, as requested by the OECD/DAC. A clear separation is
maintained between the evaluation service, which produces thematic, sectoral and
‘geographical’ (countries and regions) evaluations, and the operational and policy
services responsible for considering them and taking appropriate action responding
to the findings and recommendations.
1.3.1. The 2001 Evaluation Programme
The Evaluation Unit’s work programme for 2001 was adopted bythe EuropeAid Co-
operation Office Board at its first meeting in February 2001. In addition to the usual
policy-level analysis of major sectors, crosscutting themes, instruments and country
programmes, the programming process itself and the “policy mix” were included. By
year’s end, 17 evaluations had been completed and 8 were ongoing. The 2001
programme grouped the evaluations around four themes. A full description may be
found in Chapter 7 -Annexe - section 7.3.).
1.4. Results-oriented Monitoring
Both country-level indicators and monitoring of project results contribute to the
assessment ofperformanceofECdevelopment co-operation.
12Their roles are complementary and lessons from each should inform policy-making
at all levels. More detailed information on the two approaches can be found in
chapter 5.
The Commission is in the process of moving increasingly towards results-oriented
development assistance and an important step is also the set-up and first test of a
system to monitor regularly the results projects achieve ,i.e. their outcomes and
possibleimpactson the beneficiaries .
During 2000, the Commission conceived an improved results-oriented monitoring
system for the ALA/MED/ACP and Balkan regions, which is rooted in the
Commission’s Project Cycle Management system. This system was tested and
improved during 2001.
The main objective is to gather results–oriented information on projects in the field
and to report on progress. The system provides an overview on project progress
towards results for both Delegations and the Office. It is not primarily aimed at
project authorities, whose day-to-day management requires more detailed
information, although it should of course be of use to them as well as to partner
Ministries and Governments.
The system involves short field visits to projects by experienced external experts,
who complete semi-standard score-sheets estimating the efficiency, effectiveness,
impact, relevance and likely sustainability ofprojects and programmes. In order to
ensure consistency in the system, each of the five criteria is thoroughly defined in
conformity with existing methodology and then broken down into its components,
which the monitor has to consider carefully before giving a rating. The external
monitoring experts have varying sectoral and geographic knowledge and experience.
They work in appropriate small teams; their work is based on the analysis of
documents and interviews with representatives from all stakeholders for a given
project, including final beneficiaries. Key data such as the project budget are noted,
but no audit or in-depth financial monitoring is done. The reports, opinions of Task
Managers and basic project documents, are recorded in the central database, which
willbe a keymanagement and informationtool.
13Ongoing projects (at least six months of implementation and of another six months
duration) of a certain minimum size (approx. €1 million) are monitored. By the end
of 2001, about 500 projects with a total value of €4.7 billion had been monitored in
Latin America, Asia, Africa, the Caribbean, the Pacific, in the MED – Region and
the Balkans.
First insights on project performance from the conception and test-phase are detailed
in chapter 5.
1.5. Deconcentration ofProject Management toDelegations
The deconcentration of the management of external aid to the Delegations of the
Commission is a key element of the reform of the management of the external
assistance. The principle is that what can better be managed and decided on the spot,
in the countryconcerned, should be done there, and not in Brussels.
The Commission has set itself an extremely tight timetable. The objective is to
extend deconcentration to all the Delegations before the end of 2003, in three
successive waves: 21 Delegations to be covered in 2001, 26 more in 2002 and the
remaining 31 ACP Delegations in2003.
1.5.1. Progress achieved in 2001
The ambitious objective for 2001 – to carry out deconcentration in 21 Delegations5-
covered allthe geographical areas and therefore programmes of a very varied nature.
Meeting this objective required the Commissionservices to carryout work in parallel
ondeveloping the concept,ontechnicalpreparations and on logisticalplanning. This
complex exercise had to be launched at a time when other elements of the reform
process were being put in place both inside the Relex services (creation of
EuropeAid Co-operation Office, integration of project cycle etc), and at the broader
Commission level (financial and administrative reform). In addition the financial
resources that could be mobilised for this first wave of deconcentration were fairly
modest, particularlyconcerning the number ofnew officialposts (limited to 40). This
situationwill improve in2002: 114 posts will be available to launch the second wave
and strengthenthe first wave where necessary.
1.5.2. Preparing for Deconcentration
During the first quarter of 2001, a harmonised concept of deconcentration was
defined, covering all the geographical programmes. This was based on the following
principles:
•intime, deconcentrationwillconcernallprogrammes;
•deconcentrationwillconcernallthe phases ofthe project cycle;
5The 21 “first wave” Delegationsare:
Europe:Croatia,RussiaMediterranean :Egypt, Morocco, Tunisia,TurkeyAsia: Indonesia, Thailand, India, ChinaLatin America:Nicaragua,Bolivia, Argentina,Mexico, BrazilAfrica/ACP: South Africa, Senegal, IvoryCoast, Kenya, Mali, Dominican Republic
14•deconcentration requires the provision of substantial additional resources (human
and material);
•the role of Headquarters will evolve towards a role of co-ordination, quality
supervision, management control, technical support and improvement of working
practices.
At a practical level, deconcentration involves the following changes for the
Delegations:
•a more active contribution to programming, although final responsibility will
remain with DGs External Relations or Development according to the
geographicalarea;
•direct responsibility for identification and instruction work, with methodological
and technical support by the EuropeAid Co-operation Office, who will also be
responsible for final quality control on financing proposals and for taking these
throughthe decisionprocess (management committee procedures, etc);
•direct responsibility for contractual and financial implementation conditioned by
the strict respect of procedures, and requiring secure access to the systems of
financialand accounting management at Headquarters;
•direct responsibility for technical implementation requiring technical expertise on
the spot and the possibilityto callon more specialised advice fromheadquarters.
Between Apriland December 2001, the practicalpreparationprocess included testing
of secured computer connections, adapting information system for deconcentrated
management, developing or updating manuals of procedure, developing guidelines
on financial circuits, putting in place a specific training programme, and securing
financing for the deconcentrationofthe 21 first phase Delegations.
1.5.3. Deconcentration towards the 21 First Wave Delegations
The taskofpreparing the 21 Delegations themselves for deconcentration started early
2001. By July 2001, all Heads of Delegation had gone through a hearing with Relex
Director Generals in order to agree the additional resources needed and to define an
action plan for their mobilisation. The consolidated outcome of this process - and the
challenge it constituted for Commission Services - can best be summarised as
follows:
•307 additional staff (officials and other agents) had to be selected, recruited and
trained before their posting in the 21 Delegations;
•18 out ofthe 21 Delegations had either to move office or to rent additional office
space
•secured computer connections had to be installed in 19 out of the 21 Delegations,
in order to allow them the access to Commission accounting and management
information system.
15Progress made by end of 2001 was quite satisfactory. The majority of the 21
Delegations were ready to start operating in a deconcentrated way from January
2002, intime forthe new financialyear.
1.5.4. Preparation of the Second Wave
The list of 26 Delegations6to be deconcentrated in 2002 was agreed in September
2001. Afghanistan was added to the list later, for a fast track deconcentration as soon
as localconditions permit.
Preparatorywork started immediatelythereafter. The experience gained with the first
wave willbe put to gooduse. This expectation is that, for the first set of second wave
candidates, deconcentration will become effective in September 2002 (this assumes
that problems withoffice space constraints can be resolved).
1.6. Coherence, Co-ordination andComplementarity
1.6.1. Improving Policy Coherence
Ensuring coherence between the objectives of the EC’s development policy and its
policies and objectives in other areas is an operational priority as well as a legal
obligationfortheCommission.
The European Community has bilateral association and co-operation agreements
with most countries in Africa, Asia, Latin America as well as in the Mediterranean
and the Western Balkans, the majority of which are developing countries. The EC
has established a range of policies to promote development, poverty reduction, and
integration into the world economy. The way this is done differs from country to
countryand regionto region. The specific objectives and areas of interaction with the
EUdependonanumber offactors relatedto the countryconcerned;nationalincome,
povertyincidence, politicaldevelopments, trade structures, geographicalproximity to
theEuropeanUnionetc.
The challenge for the EU is to provide the right mix of policies for each region and
country. The broad range of policies that the EU has at its disposal gives it a unique
opportunity to apply an effective and efficient mix of co-operation instruments,
including development assistance, fishery agreements, trade instruments, political
dialogue, foreign policy instruments. The use of these various instruments is to be
made more coherent throughthe CountryStrategyPaper Process. AllEC services are
consulted in the drafting a Country Strategy Paper, in addition to consultations with
the partner country itself. CSPs are required to include a section identifying the
different EU policies affecting the partner country and analysing the appropriate
policy mix.
6The 26 "second wave" Delegations are:
Europe: Albania,Georgia,Kazakhstan, Ukraine.Mediterranean : Algeria, West Bank /Gaza Strip, Jordan, Lebanon, Syria.Asia: Bangladesh,Philippines,Pakistan,Vietnam.Latin America : Colombia, Peru, Uruguay, Chile, VenezuelaAfrica/ACP : Burkina Faso, Benin, Cameroon, Ethiopia, Madagascar, Niger, Republic of Guinea,Tanzania
16The section below highlights two concrete examples of how coherence has been
addressed in practice, in the areas of fisheries and food aid/food security. The
following chapter (Chapter 2)provides other examples.
1.6.1.1. Fisheries
In its Communication on Fisheries and Poverty Reduction7and in supporting the
process of formulating the conclusions of both Council and Parliament, the
Commission devoted a lot of attention to the issues of coherence and
complementarityinthe fisheries area. The keyobjectives ofthis effort were:
•to improve consistency and coherence between the Community Development
Policyand other common policies affecting the fisheries sectors.
•to encourage dovetailing of operations supported by the EC and those conducted
by the Member States, through a common vision of the issues at stake and the
strategies to address them.
This work, carried out with close collaboration between the responsible Commission
services for fisheries and development, has led to a reduction in incoherence between
the EC Development Policy on the one hand, and the Common Fisheries Policy
(CFP) onthe other. Keydrivers for this development have been:
•the EC’s Development Policy, which has led increasingly to the incorporation of
fisheries sector concerns into countryand regionalstrategypapers;
•the Common Fisheries Policy, which will be increasingly directed towards
sustainable development, both domestically and in terms of the Community’s
internationalrelations inthe Fisheries sector.
1.6.1.2. FoodAid/FoodSecurity
In September 2001, the Commission issued a Communication on the Evaluation and
Future Orientation of Council Regulation (EC) No. 1292/96 on Food Aid Policy and
Food Aid Management and Special Operations in Support of Food Security.8
Through this Communication, the Commission has made considerable progress oncoherence.
The Communication has ensured greater internal coherence in the use of food aid in
relationto humanitarianaidandtotheCommonAgriculturalPolicy:
•Food aid in-kind provided under the Food Aid/Food Security Regulation and
channelled mainly through direct governmental programmes, EuronAid/NGOs
and WFP will be mobilised (i) in complementarity with ECHO, to provide relief
in cases of major and protracted crisis, (ii) as a contribution to strategic reserves
and safety nets, and (iii) linking relief, rehabilitation and development.
•Food aid in-kind has clearly been dissociated from agricultural surplus disposal
and has become an instrument ofdevelopment assistance.
7Commission Communication on "FisheriesandPovertyReduction" (COM(2000)724of08.11.2000).
8COM(2001)473dated 05/09/2001modified on 12.09.2001COM(2001)473/2.
17Regarding external coherence, the Commission services concerned made
considerable progress, both in the context of the International Food Aid Convention
and the WTO negotiation process, to move towards tighter rules and greater
transparency inthe provisionof foodaid to developing countries:
•Food aid should be provided as a grant. It should however be limited to
emergency and humanitarian interventions, to linking relief, rehabilitation and
development and as an element of safety net strategies for particularly vulnerable
sections ofthe population;
•In order to respect consumption patterns and to avoid market distortion, food aid
should onlybe provided at the request ofthe beneficiarycountries specifying their
particular needs;and
•Whereverpossible, donorsshouldgivepreferencetolocalorregionalpurchases.
1.6.2. Coordination and Complementarity
Improved coordination and complementarity are essential elements in the process of
making the EC’s external assistance more effective. At the most basic level, co-
ordination entails greater awareness of what others involved in a particular sector or
country or region is doing; combined with efforts to work together more effectively.
Coordination is critical to avoid overlap or inconsistencies between those seeking to
achieve common goals. Complementarity begins with co-ordination, but it goes
further: it implies each actor focusing its assistance where it can add most value,
given what others are doing; maximising synergies.
The EC is firmly committed to both of these concepts. At the policy level, the
common framework for the EC’s and other agencies’ interventions in the
development sphere is provided by the Millennium Development Goals. In terms of
implementation, the EC aims to integrate its own support at the country level within
a wider framework wherever possible. The PovertyReductionStrategyPaper (PRSP)
process which the EC firmly supports (see Chapter 2), is designed specifically to
promote coordination and complementarity amongst donors’ efforts in low-income
countries. The EC’s new approach to programming , including the use of Country
Strategy Papers and structured dialogue with recipients (e.g. the ACP), are key
mechanisms to ensure greater coordination and complementarity. The EC’s decision
to focus its development interventions overall in six priorityareas, with the choice of
these in each country informed bywhat nationalpriorities and what others are doing,
is a further demonstration ofcommitment to these principles. Specific changes in the
EC’s policy approach and in individual sectors and regions are discussed in later
chapters. This section highlights some examples of what has been achieved from the
centre during 2001.
1.6.2.1. BetweenMember States and Commission
The Council and Commission guidelines for improved operational co-ordination
between the EC and Member States covering all countries receiving external
assistance from the Union were agreed during the 2001 Council orientation debate.9
9GeneralAffairsCouncil, 22-23January2001.
18The improvements in the programming of EC aid, highlighted above, should help
this process. In addition to consultations on country strategy papers, the sharing of
sector guidelines between the Member States and the Commission has proved to be
useful (the Commission is preparing sector guidelines for each of its 6 priority areas
for intervention;guidelines onthe transport priorityhave already beenadopted).
These efforts are beginning to show results. The Commission regularly organises
meetings with member States’Directors-General for Development.These
meetingsprovide a forum to exchange views on best practice, common concerns,
current difficulties and new approaches. In view of the major International
Conferences in 2002 on Financing for Development (Monterrey) and on Sustainable
Development (Johannesburg) a specific emphasis has been placed on co-ordination
within international bodies. A similar effort has been made to promote stronger
involvement bythe Commission in the OECD/DAC.
The mandate given to the Commission by the Member States to prepare a report in
preparation for the Monterrey Conference was a positive sign of the confidence that
had been built up. At its meeting in November 2001, the Development Council asked
the Commission to clarify a number of issues and explore, through a dialogue with
Member States, potential initiatives to be implemented bythem. The Council singled
out, in particular, the issue of increasing the volume of aid, with a view to reaching
the UN target of 0.7% of Gross National Income to be provided as official
development assistance (ODA), including through the establishment of specific
timetables. In addition to the volume of aid, particular mention was also made of the
effectiveness ofaid, including the untying ofaid, global public goods and innovative
sources of financing. The Commission’s report was to be presented at the General
Affairs Council in February2002. It summarised possible positive initiatives that had
emerged as a result of the discussions held by the Commission with Member States
and addressed the issue of how the financial gap between the current level of ODA
and the volume necessaryto meet the Millennium Declaration Goals could be closed.
This report, and the action taken by Member States, helped to ensure a positive EU
contributiontotheFinancing for Development conference.
1.6.2.2. WithOther Donors
The Commission has launched several initiatives with other donors in the framework
of the joint EU-USA, EU-Canada, and EU-Japan Summits, with a particular regard
for the Great Lakes Regions and Afghanistan. In addition, several high level
meetings have been conducted in order to improve co-operation with Norway. The
Commission is exploring pilot models for strengthening co-operation with other
donors further. A first initiative has taken place whereby officials from Japan are
hosted within the Commission. Harmonisation of donor procedures is a key element
for the improvement of coordination, efficiency and recipient country ownership. In
this regard, the Commission has launched exploratory exercises with the Member
StatesandtheDAC.Asimilar effort is being made inrelationtothe UN,throughthe
renegotiations of the General Framework Agreement and the recasting of the
financialregulation.
1.6.2.3. Withthe UN
In order to strengthen its co-ordination with the United Nations and to promote
complementarity, the Commission has been conducting an extensive policy dialogue
19and negotiations on the improvement of the EC/UN General Framework Agreement.
This has been done through meetings with, amongst others, UNHCR, ILO, UNDP,
UNICEF, UN-NADAFF, FAO, WHO, WFP, IFAD and UNESCO. In 2001 the
Commission adopted a Communication on “Building an Effective Partnership with
the United Nations in the Fields of Development and Humanitarian Affairs".10Its
overall thrust (improvement of EC-UN co-operation) was endorsed by the
Development Council of 31 May 2001. The new approach will lead to a
strengthening of the EC’s involvement in upstream policy dialogues and to a more
effective, transparent, financially predictable and easier-to-monitor operational
partnership with UN agencies, funds and programs. In the follow-up to this
Communication, the Commission has conducting a wide analysis of the core
mandate and capacities of the UN agencies, funds and programmes. On this basis,
theCommissionwillpropose, indialogue withthe Member States and where there is
an added value within commonly agreed political objectives, to strengthen the co-
operation with UN bodies through the establishment of a Strategic Partnership.
Therefore, the division of labour among donors will be based on the selection criteria
of core mandate and focus on comparative advantage added value and
complementarity.
1.6.2.4. WiththeBrettonWoodsInstitutions
Intensive contacts took place with the IMF and the World Bank in the context of the
PRSP process both at staff and management level. An EC PRSP team visited
Washington in January - in a follow-up of the IMF/WB PRSP meetings in Brussels
in September of the previous year. The mission deepened co-ordination on the PRSP
process notably with an agreement for co-financing of PRSCs11in some pilot
countries and for a reinforcement of co-operation on support to public finance
management. Progress was also made towards a convergence of views on the
importance of results-based conditionality. The plans with regard to public finance
management led to the creation of the PEFA (Public Expenditure and Financial
Accountability) programme, supported by the Bank, the EC and DFID, and financed
partlythrougha €1.9millionEC contributionto a trust fund. Co-financing ofPRSCs
on the other hand had not yet materialised by the end of the year. This was largely
due to the fact that only 3 countries (of which 2 ACP countries) had received a
PRSC, and that co-operation in the field at times fell short of expectations. In the
meantime, the EC is getting involved in joint budget support with other donors,
which is to some extent limiting future possibilities of PRSC cofinancing with the
Bank. A number of high level contacts took place in 2001, including the visit by
World Bank President James Wolfensohn to the Commission in November. The EC
has become the biggest contributor to World Bank managed trust funds through its
participation in the HIPC initiative. A multiplicity of contacts between the Bank and
the Commission continued during the year, in particular in the context of sector
coordination and special initiatives, such as the long-standing joint involvement in
the SpecialPartnership for Africa (SPA).
10Commission Communication on "Buildingan effectivepartnershipwith theUnited Nationsin the fields
ofDevelopmentand Humanitarian Affairs"(COM(2001)231 of02.05.2001.
11Poverty Reduction Support Credit, the new World Bank programmatic lending instrument for PRSPcountries.
202. PROGRESS TOWARDS THE DEVELOPMENT GOALS
The Millennium Declaration, which was agreed by 147 Heads of State and Government and
189 countries in total at the Millennium Summit in September 2000, was an historic
agreement that is shaping international development co-operation efforts today, including
those of the European Community. The Millennium Development Goal (MDG) is contained
in the Declaration and developed in the UN ‘road map’ - for implementation of the
Declaration - provide a common framework for focusing and measuring development
progress. These goals, which grew out of the agreements and resolutions of UN conferences
of the past decade, including the International Development Goals of the 1990s, have also
been endorsed by most major multilateral organisations. They therefore have unprecedented
legitimacy.
This chapter explains how the EC is working withothers to achieve the MDGs, as well as the
content of the specific objectives of the new EC development policy agreed in November
2000. A system for tracking progress towards the achievement of the MDGs has been agreed,
although major efforts are still needed to improve statistical capacity in developing countries.
Available data highlights uneven progress across regions and between the different goals
(Section 2.1.). The primary aim of the EC’s own development policy, agreed in November
2000, is the eradicationofpoverty(Section 2.2.). To help monitor its contribution towards the
MDGs and other policy objectives, the EC is developing a system of indicators for monitoring
country performance (Section 2.3.). It is also monitoring the allocation of resources from the
EC development programme to Low Income Countries, and to priority sectors (Section 2.4.).
To enhance its impact, the EC is targeting its assistance on six priorityareas (Section 2.5.). In
addition to these core areas, important crosscutting issues are being mainstreamed into
development activities namely: Human Rights, gender equality, environment and conflict
prevention(Section2.6.).
2.1. The MillenniumDevelopment Goals
Statistical data on progress towards achieving the Millennium Development Goals12
is scarce, although improving. At the global level, a number of organisations are
tracking progress, in particular the UN, the World Bank and the OECD’s
Development Assistance Committee (DAC). The Commission, along with other
donors, is supporting efforts to enhance statistical capacity in many developing
countriesandregions.
The data available shows that there is a long way to go before the international
community achieves the Millennium Development Goals. Prospects vary by region,
and bygoal. Progress in sub-Saharan Africa lags behind the rest ofthe world.
12see: http://www.developmentgoals.org
21Progress towards Development Goals
POVERTY
EDUCATION

22GENDER EQUALITY
CHILD MORTALITY

23MATERNAL HEALTH
AIDS

24ENVIRONMENT
Source: World Bank
Progress has been made towards reducing extreme poverty, particularly in Asia. But a vast
discrepancyis occurringbetween Sub-Saharan Africa andmost of the rest of the world. Poverty
ratesinEasternEurope andCentral Asia arerelativelymodest but have risensteeply.
Primary school enrolment is improving, although there is still a long way to go in Middle East
and North Africa, South Asia and Sub-Saharan Africa.
South Asia and Sub-Saharan Africa are only progressing slowly when it comes to gender
equality in school enrolment. The decreasing ratio of girls to boys in school in Latin America is
regrettable
Infant mortality rates are improving, although not fast enough in all cases to reach the 2015
target.Hereagain, Sub-Saharan Africais aparticularconcern.
Failingmaternity healthcareinSub-SaharanAfricaseemstobe one of thereasonsfor this.
Access to clean water and sanitation is still a problem in many countries, particularly in rural
areas.
2.2. Poverty reduction
The Declaration by the Council and the Commission on the European Community’s
Development PolicyofNovember 200013defines the main objective of the European
Community’s development policy as the reduction and eventual eradication of
poverty. This objective entails support for sustainable economic, social and
environmental development, promotion of the gradual integration of the developing
countries into the world economyand a determinationto combat inequality.
A Commission Staff Working Paper produced in July 200114establishes the main
elements necessary to address the poverty reduction objective of EC Development
Policy. This work programme is being implemented progressively. The sections
below highlight the main elements for 2001.
13http://www.consilium.eu.int/Newsroom/newmain.asp?lang=1
14SEC (2001)1317 of26.07.2001
252.2.1. Allocation offinancialresources
The EC’s approach to the allocation of aid recognises that particular attention must
be paid to the situation of the Least Developed and other Low Income Countries15.
The EC also takes account of the efforts made by the governments of partner
countries themselves to reduce poverty, both in terms of their performance and their
absorption capacity. Among middle income countries, the Joint Declaration on EC
Development Policy requires that attention should be focused on those countries
which feature both a continuing high proportion of ‘poor’ and a full commitment to
implementing coherent poverty-reduction strategies.
The allocation of EC development resources to Low Income Countries or poor
populations varies betweenregions.
ACP countries: Close to 90% of European Development Fund (EDF) resources are
earmarked to Least Developed Countries and other LowIncome Countries.
Central America, the Andean region, and Paraguay: Two thirds of EC aid to this
region is targetedonthe poorest segments ofthe ruraland urbanpopulations.
Asia:EC development co-operationprogrammes with Asia have been focused onthe
poorest countries in the region since their beginning, and on ‘the poorest groups’ in
the populations of these countries. Over the last five years, an average of 80% of EC
assistance has gone to the poorest countries: 32% has gone to the Least Developed
Countries (notably Bangladesh, Bhutan, Cambodia, Laos, the Maldives and Nepal)
and 48% has gone to other Low Income Countries (i.e. India, Indonesia, Pakistan,
Vietnam).
2.2.2. Poverty focus in Country Strategy Papers
The specific policy reforms and programmes to tackle poverty in different countries
will be affected by the circumstances of the country itself. Sustained economic
growth - although not sufficient by itself - is an essential prerequisite for poverty
reduction, as noted in the November 2000 statement. Many developing countries
have recently gone through major transformations, such as transition from
communism to democratic market economies or from military to civilian democratic
rule. In Eastern and Central Asia, the EC’s focus is on supporting this transition
process, chieflythrough institution building, which is judged to be the most effective
remedy against poverty in this region. Conversely, in the Balkan region, peace and
stability measures are seen to be the most effective instruments. In North Africa and
the Mediterranean region, support is aimed particularly at strengthening the capacity
of the region to integrate into the world economy through support to economic and
socialdevelopment.
2.2.3. The Poverty Reduction Strategy Paper (PRSP) process
The EC believes strongly that ownership of the strategies for sustainable
development and poverty reduction by partner countries is the key to the success of
15Thereare currently49 ‘Least Developed Countries (LDCs)’ which are designated as such by the UN on
the basis of low per capita income, weak human resources, and a low level of economic diversification.The ‘Low Income Country’ covers a broader group of countries defined by their income alone (theWorld Bankclassification is based ona per capitaincomeofless than US $700in 2000).
26development policies. Consistent with this, the Commission strives to integrate its
support, as outlined in its CountryStrategyPapers, into a wider framework. For Low
Income Countries, the key framework is the Poverty Reduction Strategy Paper
(PRSP) and the process that accompanies it. The Commission’s efforts have been
made difficult by the lack of full PRSPs: only 8 countries had produced full PRSPs
bythe end of2001. When CSPs are updated, however, theycan be adapted to reflect
progress inthecountryconcerned indevelopingafullPRSP.
Development of the PRSP approach offers a major opportunity to enhance the
effectiveness of the global development effort. The Commission has contributed
substantially to the development of the approach, both through its own strategic
refocusing (including a shift towards direct contributions to the budgets of partner
countries where necessary conditions are met) and through its contribution to
international policy development. This contribution is further reinforced by the
Commission’s role as co-chair of the Technical Group of the Strategic Partnership
for Africa16, and as leader of the Burkina Faso based pilot project on reforming the
conditions imposed on partner countries to trigger the provision of macro-economic
support.
If PRSPs are to become an effective framework for external assistance, however,
they need to have stronger performance indicators. This should include a core set of
indicators, measured annually, for which country governments hold themselves
accountable to their citizens and by which the Commission (and other external
partners) can judge progress. The Commission has played a leading role in
international work to develop tools for such performance monitoring, and aims to
integrate into its CSP monitoring process appropriate indicators drawn from the
PRSPs.
2.3. Measuring Effectiveness Through Results Indicators
The Commission measures results through indicators at two distinct but
complementarylevels ofdetails:
•To measure country performance in terms of economic growth, increasing
standards of living and poverty reduction over the short, medium and long term.
This level of indicators draws from the most relevant of the indicators associated
with the Millennium Development Goals, possibly complemented by a limited
further set ofkey indicators.
•To measure in a more detailed way the performance of the country’s sectoral
policies inthe sectors supported.
The two levels outlined above constitute in fact two complementary degrees of
detail, which need to be analysed ina coherent way.
At the first level, in all countries where the Commission is working, a limited set of
indicatorsshouldbe monitoredinorderto haveaglobalviewofprogresstowardsthe
MDGs. This limited set should draw from the most relevant of the 48 indicators
16An informal grouping of donors under the leadership of the World Bank. See
http://www1.worldbank.org/prsp/newsletter/Feb_2001/Our_Partners__Perspectives/Strategic_Partnership_for_Afri/strategic_partnership_for_afri.html
27associated with the MDGs plus, in order to be able to report annually on countries’
progress, a small number of annually measurable key indicators. These
supplementary indicators would include input indicators (which are not part of the
MDG monitoring framework), e.g. indicators to measure the financial support to
specific sectors from both government and donors. It would also include real-time
outcome indicators. The draft guidelines for the definition of development
indicators17suggest that this set of indicators, once agreed, should be featured
systematicallyin allCountryStrategyPapers.
Systematic monitoring using this wide range of indicators, including annually
measurable and input indicators at country level, will allow the Commission to keep
an eye on the evolution of sectors even where it is not an active player. This will
informthedecisionstakenatthereviewoftheCountryStrategyPapers.
At the sectoral level, in CSP priority sectors, a wider range of indicators will be
monitored. These indicators should be part of the more comprehensive set of
indicators monitored by the relevant national ministries. The Commission will work
with other donors and partner countries to identify a limited set of ‘good practice
indicators’ to monitor sector performance. This indicative list would then serve as a
framework for a more effective and coherent national discussion on sector
monitoring. Policy orientations and regulatory measures by government should also
be monitored, even if they cannot so easily be measured through generalised
quantitative indicators.
In all cases, indicators monitored by the Commission are based on the national
processes taking place in the relevant country (PRSPs for those countries covered by
them). This allows reciprocal influence and experience sharing, as well as a valuable
opportunity to discuss policy issues and increase governments’ domestic
accountability.
In the framework of programming, guidelines are being developed to support
programmers in introducing development indicators into CSPs. As most donors are
stillat a veryearly stage in the work on development indicators, the Commission has
chosen to associate EU Member States, the OECD’s Development Assistance
Committee (DAC), and other donors in the drafting ofthese guidelines.
A joint working group between EU Member States, OECD-DAC, and various
Commission services will start in March 2002. The objective of this working group
is to explore the potential for donors to adopt a coherent approach, including
commonprinciples and typology, in their monitoring requirements in order to reduce
the burden imposed on recipient countries. The basis for this work is the Draft
guidelines for the definition of development indicators18prepared by the
Commission. This is ‘work in progress’, and its outcomes will progressively feed
into the Commission’s programming and review process. EU Member States and the
OECD-DAC have warmlywelcomed it.
17seehttp://www.europa.eu.int/comm/development/sector/poverty_reduction/infopack_ann1.pdf
18seehttp://www.europa.eu.int/comm/development/sector/poverty_reduction/infopack_ann1.pdf
282.4. SectoralTargeting in theProgramming Process
As part of its efforts to improve the impact of Community development assistance,
the Commission has made a consistent effort since 2000 to focus EC assistance on
core areas that are important for poverty reduction and where Community action can
add value. The new EC development policy agreed in November 2000 identified six
priority areas: trade and development; regional integration and co-operation; support
to macroeconomic policies and equitable access to social services; transport; food
security and sustainable rural development; institutional capacity building, good
governanceandtheruleoflaw.
This section outlines the main areas of programmed interventions as reflected in the
Country Strategy Papers that have been formally approved or are close to
finalisation. The sectoral breakdown is based on the OECD-DAC classification
system. Some changes in the sectoral breakdown may still occur, after the
finalisationofCSPscurrentlybeing processed and after analysisofdraft CSPs stillto
come. The overallpicture, however, is unlikelyto change substantially.
Adetailed discussionofthe EC’s approach ineachregion is contained inChapter 4.
2.4.1. African, Caribbean and Pacific (ACP) Countries
The multi-annual programming for the ACP countries covers the 9thEuropean
Development Fund (EDF) which will become operational once the Cotonou
Agreement comes into force19(currently expected early in 2003) for (normally) a
five year period.
The CSPs reviewed so far show a focus on transport and macro-economic support
(for poverty reduction strategies), including budget financing for PRSPs with an
emphasis on health and education. Transport accounts for approximately 31% and
macro-economic support for 21% of resources programmed. The other major
priorities are: direct allocations for education and health (10.4%); water supply and
sanitation (7.1%); food security and rural development (7.1%); and institutional
support and capacity building in favour of government and civil society (10.8%).
Resources earmarked for the mining sector (5.3%) relateto the ‘Sysmintransfer’20.
In summary, around 27% of the available resources programmed thus far for the
period 2002-2006 focus on social services and infrastructure as defined by the
OECD-DAC. In addition to this percentage, 21% of the resources have been
programmed for structural adjustment support frequently linked to performance in
thesocialsector.
19In order to come into force, the Agreement must beratified byat least two thirds of the ACP States, by
all the EU Member States and be approved by the European Community (article 93.2 of the CotonouAgreement). As of 18 January 2002, thirty-six ACP States, four EU Member States and the EuropeanCommunityhad completed thisprocess.
20(SYSMIN: System for Safeguarding and Developing Mineral Production – these funds are allocated tosupport traditional industries.) This is the ‘SYSMIN transfer’ from the 8
thEDF destined to finance the
development programme identified following a request for aid under the Sysmin programme of theLomé Convention but for which no financing decision could be taken before 31 December 2000
292.4.2. Mediterranean
The multi-annual programming completed for the MEDA region21covers the period
2002–2004.
The programming has resulted in a generally high concentration in social
infrastructure and services. An average of 47.8% has been allocated to social
infrastructure and to macroeconomic support liked to social sector performance.
Other priorities include the environment (5%), trade and tourism (7%) and transport
(7%).
2.4.3. Latin America
The multi-annualfinancialprogramming forthis regioncovers the period 2002-2006.
The major areas of programmed intervention are the social sectors (including
education, health and water supply and sanitation - 23%), government and civil
society (18%) and trade and tourism (15%). The choice of sectors reflects the
specific needs in the region i.e. direct interventions to improve social services for the
poorest groups, support to build sustainable institutions to enhance good governance
and growth combined with the promotion of trade and tourism to facilitate further
integration into the world economy.
2.4.4. Asia
The multi-annualfinancialprogramming forthis regioncovers the period 2002-2004.
The programming reflects a strong focus on direct poverty reducing activities.
Particular emphasis is given to education, health and water and sanitation (43%),
tradeand tourism(9%), environment (4%) and supportto NGOs (5%).
2.4.5. Eastern Europe and Central Asia
The multi-annualfinancialplanning for this regioncovers the period 2002-2004.
TACIS22funding is programmed in complementary areas. Each national or multi-
country programme focuses on no more than three of the following
areas: institutional, legal and administrative reform; private sector and economic
development; consequences of changes in society; infrastructure networks;
environmental protection; rural economy; and nuclear safety. This selectivity is
designed to enhance effectiveness. The major areas of intervention are: energy
24.4%;government and civilsociety21.1%;and private sectordevelopment 16.3%.
2.4.6. The Balkans
The multi-annualfinancialplanning for this regioncovers the period 2002-2004.
21MEDA covers aid to the reform of economic and social structures in the framework of the euro-
Mediterranean partnership covering Morocco, Algeria, Tunisia (Maghreb); Egypt, Israel, Jordan, thePalestinian Authority, Lebanon, Syria(Mashrek);Turkey, CyprusandMalta.
22TACIS: Technical Assistance for the Commonwealth of Independent States covering Armenia,Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgystan, Moldova, Mongolia, Russia, Tajikistan,Turkmenistan,UkraineandUzbekistan.
30The European Union is by far the single largest donor to the western Balkans as a
whole, through programmes such as PHARE23in Eastern Europe, OBNOVA24for
the former Yugoslavia and the Balkans and CARDS25inthe Balkans. Forthe coming
years, EC assistance will focus on institution building and civil society (42%);
education, water and sanitation and other social services (20%); and private sector
development (11%).
2.5. Policy Initiatives in ECPriority Areas
2.5.1. Trade and development
Trade and investment liberalisation operating within a sound and transparent
economic domestic policy framework plays an important role in the promotion of
economic growth and development.
The European Community is committed to fostering the smooth and gradual
integration of developing countries into the world economy, by mainstreaming trade
in the development strategies of the developing countries in an integrated manner,
and by promoting regional and domestic policy frameworks conducive to economic
growth and social development. The EC is the largest importer of agricultural
products fromalldeveloping countries and, generally, their majortrading partner.
In the WTO, the EC has been a strong advocate of a new round of multilateral trade
negotiations, centred on the needs and interests of developing countries. The
priorities agreed at the WTO Ministerial in Doha in November 200126the ‘Doha
Development Agenda’) set out a clear framework to strengthen the link between
trade and development in the multilateral trading system. The integration of
developing countries into the world trading system and the global economy is the
core priority of the Doha Declaration. It takes on board the concerns of the
developing countries as expressed by the ACP group27on ‘the importance and
urgency of integrating ACP states into the multilateral trading system and, in that
regard, that development issues should be at the core of any future work programme
oftheWTO’.
Bilaterally, the EC offers a range of preferential trade regimes to developing
countries. A number of these were under discussion, or amended, during 2001. The
EC has concluded or is negotiating preferential trade agreements with the
Mediterranean countries, South Africa, MERCOSUR, Chile, the Gulf Co-operation
Council and is examining the possibilityofnegotiations with others. In the context of
the Cotonou Agreement (for the ACP countries), the EC is also already providing far
reaching non-reciprocal trade preferences. Preparations for the forthcoming
negotiations on Economic Partnership Agreements with ACP sub-regions (due to
commence in September 2002) began in earnest during 2001. Developing countries
23PHARE: Poland and Hungary: Aid for Economic Restructuring (now extended to cover Bulgaria,
Czech Republic, Estonia, Latvia, Lithuania, Romania, Slovakia and Slovenia).
24OBNOVA: Programme for reconstruction in Bosnia, Croatia, Serbia, MontenegroandFYROM
25CARDS: Community Assistance for Reconstruction, Development and Stabilisation covering theWestern Balkans (Bosnia and Herzegovina, Croatia, the Federal Republic of Yugoslavia, the formerYugoslavRepublicofMacedoniaandAlbania)
26seehttp://www.wto.org/english/tratop_e/dda_e/dda_e.htm
27Declaration by the ministers responsible for trade of the ACP states on the 4thWTO ministerial
conference, 7 November 2001
31are also benefiting fromunilateraltrade preferences in the context of the Generalised
SystemofPreferences, whichwas further improved from1 January2002.
In February 2001, the EU agreed to grant duty and quota free access for all products
originating from Least Developed Countries (LDCs) except for arms and munitions:
the ‘Everything But Arms’ initiative28. This became effective in March 2001. In
agreeing to this, the EU did away with remaining tariffs on agricultural products.
Even the three most sensitive products - rice, sugar and bananas - were included,
although these are to be progressively liberalised over the next four to eight years.
The beneficiaries of this liberalisation are the 48 LDCs already covered by the EU
Generalised Scheme ofPreferences29.
Ensuring that developing countries - and notably LDCs - benefit ‘from the increased
opportunities and welfare gains that the multilateral trading system generates’30will
require well targeted technical assistance and capacity building programmes. In
additionto thetrade preferences it grantsto developing countries (see below), the EC
is offering Trade Related Technical Assistance and Capacity Building measures to
support developing countries in their efforts to strengthen their judicial, regulatory
and institutional capacities. The Country Strategy Papers provide the general
frameworks for all the EC’s interventions. The Commission is also working with EU
Member States,other bilateraldonors and the multilateral institutions to promote co-
ordination and complementarity mechanisms for technical trade related assistance.
This is being done in the context of the relevant multilateral funds such as the Doha
Development Agenda Global Trust Fund and the Integrated Framework Trust Fund
for LDCs.
2.5.2. Regional Integrationand Co-operation
The EU is a strong supporter of regional integration, which fosters better
understanding and political and economic links between neighbouring countries.
This process can consolidate peace, prevent conflict and promote the integration of
developing countries into the world economy, thereby enhancing prospects for
economic growth and sustainable development.
The policy context for EC support to regional integration and co-operation evolved
during 2001, and will continue to do so. This was particularly due to the need to
ensure consistency between external developments – such as the WTO Doha
Development Agenda launched in November 2001 and, for ACP countries,
preparations for the implementation of the Cotonou Agreement and the negotiations
to be launched in2002 onEconomic Partnership Agreements.
2.5.3. Macro-economic Policies and Equitable Access to Social Services (Health and
Education)
There is a growing internationalconsensus that, froman aid effectiveness viewpoint,
it is helpful to move away from stand-alone projects towards direct contributions to
28Regulation (EC) No416/2001 of28 February2001, Official Journal oftheEuropean Communities L 60
of1.3.2001;http://Europa.eu.int/eur-lex
29See list of LDCs in Annex IV of Regulation (EC) No 2820/98 of 21 D ecember1998, Official Journal
357 of 30.12.1998. However, all GSP preferences for Myanmar have been suspended, and this alsoapplies toEverything ButArms.
30WTO ministerial declaration, 14 November 2001, para2
32the budgets of partner countries (budget support) whenever the conditions in a
countrypermit it. Moreover, this budget support should be linked to national poverty
reduction strategies – such as PRSPs - wherever they exist. This should result in
stronger countryownership, reduced transaction costs, unified planning and resource
allocation, andenhancedcomplementarityand flexibility.
Such budget support is only provided where it can be expected to be effective. This
requires that the country manage its macro-economy in a stable and sustainable
manner. Prudent fiscal and monetary policies are central to poverty reduction,
together with structural changes that create the scope for private sector led growth.
All budget support programmes are linked to the continuation of sound
macroeconomic policies, measured throughanagreed IMFprogramme.
The European Commission has played a leading role in developing results based
mechanisms for macroeconomic budget support that enhance country ownership and
provide incentives for governments to monitor progress using key indicators of
poverty and of public financial management. Of 24 ACP macroeconomic support
programmes in 2000 and 2001, 12 included a fully results based approach, 6 were
linked to a positive results assessment and to progress with public financial
management and 6 were linked to other (process based) indicators.
In all ACP countries, budget support is linked to the results attained in addressing
aspects of poverty covered in the Millennium Development Goals. Such budget
support thus provides a strong incentive for the government to deliver effective basic
services. It also provides additional resources for the government to allocate to this
goal. Iftheyaretobeused inannualperformance management, the indicators chosen
(which are focused primarily on basic social services such as health and education)
need to be measured annually, and be capable of being monitored within this
framework i.e. to evolve swiftly). In 2001, €270.31 million was spent on ACP
macro-economic support.
In MED countries, budget support is an opportunity for dialogue with the partner
countryon social matters and povertyalleviation. The dialogue often concerns major
sectoralprogrammes e.g. educationand health in Tunisia, and water and education in
Morocco. Inthese programmes, the reason for focusing on education, health or water
is to contribute to major reforms in the sectors, with the objective of improving the
quality and the coverage of basic services, whilst ensuring sound public finance
management. These sectoral programmes targeting social sectors are complemented
by more traditional projects (education in Egypt) or social funds31(in Egypt and
under preparation in Algeria, Jordan and Lebanon). As a result, a major share of the
totalMEDAfinancing isdevotedtosocialsectors32.
Water Management
Water management has to be seen as a cross-sectoral issue to be mainstreamed
withinmost development policies associated withpovertyreduction. It is particularly
important for human development, alongside health and education. An EC
Communication on Water Management in Developing Countries was drafted in
31Social fundsareusedtosupportlocal development planse.g. micro-financing
32Social sectors include: health, education, training, employment, civil society, gender, Human Rights,
local development, social protection, socialimplications ofindustrialrestructuring
332001. One objective ofthis Communication was to highlight where and how policies
surrounding water and development are integrated into the European Community’s
development priorities. The centralpart ofthe document articulates key messages on
policy orientation and actions for the way forward. Under the overarching policy
framework of Integrated Water Resources Management, the focus is on water supply
and sanitation, transboundary water resources management, and cross-sectoral
coordination and integration of the different water uses. The Communication,
building on the results of the Bonn Freshwater Conference of December 2001,
promoted the development of an EU initiative as a key agenda point for the World
Summit onSustainable Development inJohannesburg inAugust/September 2002.
Educationand Training
Programming guidelines on education and training have been developed and focused
more closely on poverty reduction. Programming in developing countries has
concentrated on Education For All (basic education) and vocational training, through
macro-economic support and programme support. Gender issues have been carefully
taken into consideration also through the increased focus on primary education and
outcome indicators.
The Commission has organised two meetings with EU Member States’ education
experts on sector-wide approaches, the poverty focus, and on the Commission
Communication on Education and Training in the Context of Poverty Reduction in
Developing Countries, to be adopted in2002.
The Commission has influenced the international agenda on education in 2001
through contributions to two major UN events: the UN Conference on Least
Developed Countries and the UN General Assembly Special Session on Children
(21stMayto 7thJune 2002).
The Commission has actively participated in the follow-up to the Dakar Conference
on Education for All and the work of the senior officials' G8 Task Force on
education to take forward implementation of the Dakar Framework for Action on
Education for All. The main concerns inthis forumhave been:
•increased mobilisation and coordination among donors to meet the Millennium
Development Goals ineducation;
•greater consistency between these targets and the Country Strategies and the
PovertyReductionStrategies;
•improved coordination at all levels of interaction with national governments
through a Code ofConduct for funding agencies and partner countries; and
•the need to bridge the financial resources gap for countries committed to the
Dakar goals.
2.5.4. Health, AIDS andpopulationpolicy
For health, AIDS and population policy, programming guidelines have been adopted
in the context of poverty reduction, gender mainstreaming and the Millennium
Development Goals forhealth.
34The Commission has participated actively in the follow-up to the commitment made
by the G8 at their 2000 summit to increase support for action taken against
communicable diseases in developing countries33. The EC Programme for Action on
Communicable Diseases was adopted in February 2001, endorsed by the General
Affairs Council in May and by The European Parliament in October 200134.T h e
decisions taken on priority actions led to coherent EC positions in preparation for
major international events. These included: the UN General Assembly Special
Session on HIV/AIDS; the Least Developed Countries Conference; the EU/US
Summit in Gothenburg; the G8 Summit in Genoa; the EU/Canada Summit; the
follow-up to the Cairo Plan of Action; the Doha Declaration on Trade Related
Intellectual Property and Public Health; and the transitional process leading to the
establishmentoftheGlobalFundtofight HIV/AIDS, malariaandtuberculosis.
The Commission prepared the legal base for its involvement in the Global Fund as
well as participating actively in the working party established to set up the Fund. It
also prepared two proposals for the revision of the legal bases for two special EC
budget lines: one for povertydiseases and one for reproductive and sexual health and
rights. In addition, the Commission has prepared a new health and poverty
communication. This is the first time there has been a single Community policy
framework to guide future support for health, AIDS, population and the fight against
povertywithinthe context ofoverallEC assistance to developing countries.
The Commission organised two meetings with health experts from Member States,
one on a European approach to the Global Fund and one on health and poverty
policies and programming. The Commission introduced the first outline of its
C o m m u n i c a t i o no nH e a l t h ,A I D S ,P o p u l a t i o na n dP o v e r t yi nD e v e l o p i n gC o u n t r i e s
scheduled for adoption in2002 inthe latter meeting.
2.5.5. Transport
In May 2001, in response to the Commission Communication of July 2000 on
‘Promoting Sustainable Transport in Development Co-operation’35,t h eC o u n c i l
adopted a ‘Resolution on Sustainable Transport on Development Co-operation’36.
These two documents, takentogether, establish a strong and clear policy platform for
EUinterventions inthesector.
The strategy for reaching the development goals is based on the principle that
transport should be affordable and meet stakeholder needs. It should be safe and
efficient and should have a minimal negative impact on the environment. It is a
comprehensive strategy in the sense that it is valid for all transport modes and
associated services involved in the movement ofpeople and goods.
The Community’s approach to development co-operation in the transport sector is
based on the recognition that effective transport systems in urban and rural areas are
essential in facilitating poverty reduction through the promotion of economic and
social development, and access to social services. They are also important to
facilitate trade and the integration of developing countries into the world economy.
33see:http://www.g7.utoronto.ca/g7/summit/2000okinawa/finalcom.htm
34COM (2001) 96 of21.2.2001
35COM (2000) 422 of6.7.2000
36CouncilResolution 9985/01followingthe2352ndCouncilDevelopment Meetingof31.05.2001
35Support is designed to assist developing country partners in formulating and
implementing strategies for the sector, in co-operation with all stakeholders, to meet
these poverty reduction and integration objectives. Such strategies need to have a
clear process of prioritisation, with a sound balance between maintenance and
investment, and should be economically, financially and institutionally sustainable,
as well as environmentally sound, safe and socially aware. Financing for these
strategies is generally provided in the framework of sectoral programmes. This
facilitates improved monitoring, simplifies sector management and leads to a more
transparent and improved allocationofresources.
Based on the principles and strategy outlined above, ‘Programming Guidelines’ for
the programming of transport sector support under the 9thEDF were developed and
made available to all Commission Delegations in 2001. These included formats for
analysing transport policy, the problems and issues arising in strategy
implementation and recommendations for the formulation of the EC transport
response strategy.
Of the 44 ACP Country Strategy Papers presented in 2001, 23 countries - almost all
in Africa - proposed transport, transport infrastructure or roads as a priority sector,
for a total of approximately €1.7 billion. The CSPs for these 23 countries have all
based their proposals for the EC response strategy in the sector on the Programming
Guidelines. The main areas for EC sectoral support under these CSPs are sector
strategy development, road maintenance (backlog and periodic), capacity building in
both the public and private sector (e.g. domestic contracting), and the upgrading of
roads, particularlyfocussing onkeyregionaltransport links betweencountries.
Policy and strategy coordination with EU Member States, the World Bank and other
donors forms an essential element of EC support to transport, in order to ensure the
coherence and complementarity of EC interventions. In 2001 the Commission held
discussions with the EU Member States transport experts’ group on the above-
mentioned Programming Guidelines and also launched a dialogue on indicators for
monitoring transport sector performance and transport’s contribution to development
co-operation.
Policy and strategy dialogue is also pursued through the Sub Saharan Africa
Transport Policy Programme (SSATP) – which brings together UNECA, World
Bank, EC, several Member States, Norway, etc and approximately 30 African
countries. In 2001 a new governance structure was implemented to increase African
ownership, strengthen programme management, and create a small SSATP Board
(the Commission represents donors). A programme review was also carried out.
These changes have increased African confidence and donor willingness to support
the programme, which should sustain impact at a country level and secure donor
financing in the medium term.
2.5.6. Food Security and Sustainable Rural Development
Following an external evaluation of the Commission’s Food Security/Food Aid
policy in 1999, an important step was made in 2001 to integrate further these issues
into the Commission’s development objectives and policy. A Communication to
36Council and Parliament37onthe futureorientationofCouncilRegulationEC 1292/96
defines indetails:
•the role of the Regulation and its coherence with other Commission policies and
instruments;
•the specific objectives and applications of the various instruments within the
Regulation;and
•the measures required to improve the efficiency and the quality of programme
management at allstages ofthe programming and project cycle.
With roughly70% ofthe world’s poor living in ruralareas, the emphasis in 2001 has
been on reviewing the Community policies and strategies in the rural development
and naturalresources sectors (agriculture, livestock, fisheries and forestry), to ensure
their effective contribution to the poverty reduction objective. Moreover, a
Commission strategy to support agricultural research at national, regional and global
levels has been formulated. This work, carried out with broad-based participation
from the relevant Commission services and active support by Member States,
provides the basis for a Communicationto Counciland Parliament onFighting Rural
Povertyprepared during 2001 and to be presented in2002.
For both areas - food security and rural development (including the main natural
resource sectors) - operational guidelines for programming have been developed and
disseminated. Efforts have also been made to ensure the integration of natural
resourcesissues inthe context ofregionalprogramming. However, while most ofthe
CountryStrategyPapers provide a good analysis of food security and rural concerns,
these concerns are sometimes missing fromthe programming perspective.
2.5.7. Institutional CapacityBuilding
Efforts have been made to integrate institutionaldevelopment and governance issues
into the CountryStrategyPapers. The multi-annual programming exercise completed
during 2001 has given a high priorityto programmes supporting the strengthening of
governments and civil society(see section 2.4.).
C S P sf o rt h eA C PS t a t e si d e n t i f yt h i sa r e aa sam a j o rp r o b l e mi nm o s to ft h e
countries analysed so far. Consequently, institutional capacity building has been
chosen either as a priority sector for Community support or is treated as a cross
cutting theme.
The TACIS programme, which supports the transition to democracy and a market
economy in the Newly Independent States, has been focused on institution building
since its inception while ACP, MEDA, Asia and Latin America and CARDS
(Balkans) use 4–21% ofthe available resources in this area, the TACIS programming
provides for more than40%.
Considerable efforts have been devoted to the provision of policy advice e.g. in trade
policy, drafting of legislation, support for border management, reform of the
regulatory framework of the economy, financial sectors / corporate governance /
37COM (2001) 1of11.01.2001
37reconstruction of enterprises and the restructuring of public institutions. The
programme is now moving on to include, for example, support for fair and effective
legalsystems, sustainable socialsystems and municipalservices. Withthe realisation
that transition will be a longer process than originally expected, the programme is
shifting fromshort-term advice to longer-term partnerships between organisations. It
also now differentiates more stronglybetweenthe countries ofthe region, in order to
takeaccountoftheirdifferent levelsofdevelopment.
An internal network has been established to develop a set of practical tools to
improve the quality of the design and implementation of EC programmes and
projects inthis area.
2.6. Mainstreaming the Cross-cutting Themes
The Commission recognises that, at every stage of execution of its activities in the
six priority areas, the Community also needs to mainstream crosscutting concerns.
The four crosscuttingthemes identified intheEC’sDevelopment Policyare:
•thepromotionofHumanRights;
•equalitybetweenmeanandwomen;
•the environment;and
•conflict prevention.
The main developments in each area are outlined below. Progress with
implementationofspecific horizontalinstruments is discussed inthe next chapter.
2.6.1. Human Rights
The European Commission made its first policy statement on Human Rights since
1995 when it issued its Communication on the EU Role in Promoting Human Rights
and Democratisation in Third Countries in May 200138. The document recognises
that it is one of the Commission's roles to promote coherence, consistency and
transparency and to avoid double standards in the EU foreign policy as a whole. A
further role is to promote the involvement ofcivil society in the EU activities in this
area.
This Communication identifies three areas where the Commissioncanadd value:
•promoting coherent and consistent policies in support of Human Rights and
democratisation. This applies both to coherence within and between European
Community policies, and between those policies and EU action, especially the
Common Foreign and Security Policy. It also relates to the promotion of
consistent and complementaryactionbythe EU and member states.
•placing a higher priority on Human Rights and democratisation in the European
Union's relations with third countries and taking a more pro-active approach, in
particular by using the opportunities offered by political dialogue, trade and
38COM (2001) 252 of8.5.2001.
38external assistance. The Commission will henceforth - where it does not already
do so - systematically mainstream Human Rights and democratisation issues into
the political dialogue it holds with non EU countries and its assistance
programmes.
•adopting a more strategic approach to the European Initiative for Democracy and
Human Rights (EIDHR), matching programmes and projects in the field with EU
commitments onHumanRights and democracy. To maximise impact, it identifies
four themes on which the EIDHR will focus as well as a greater concentration on
certain focus countries.
The Commission Communication was welcomed by the Council in the June 2001
General Affairs Council as a ‘valuable contribution towards reinforcing the
consistency and coherence ofEU policy’ in this area
On the basis of this Communication, the following activities were undertaken in
2001:
a) Strengtheningofthedialoguewiththirdcountries:
The European Commission participated in the two sessions of the EU/China Human
Rights dialogue which China held in Stockholm and Beijing in October 2001. The
Commission also co-organised - with the Presidency in office - two Human Rights’
seminars inthe frameworkofthis dialogue in Beijing in May2001 (the death penalty
and the right to education) and in Brussels in December 2001 (the fight against
torture and the right to education). The Commission also participated in the political
dialogue with North Korea and sent a Human Rights expert as part of the EU
delegationto Pyongyang inOctober 2001.
The EU approach to Human Rights dialogue with countries outside the EU was
formalised in guidelines adopted by the Council on 13 December 200139.T h e s e
guidelines aim to strengthen the coherence and consistency of the European Union's
approach towards the Human Rights’ dialogue instrument and to facilitate its use by
defining the conditions inwhich it can be applied and made effective.
b) Multilateral fora
The World Conference against Racism, Racial Discrimination, Xenophobia and
Related Intolerance took place in Durban, South Africa from 31 August to 8
September 2001. The World Conference aimed to focus on action-oriented and
practical steps to eradicate racism, including prevention, education, protection and
the provision of remedies. The Commission prepared a contribution to the World
Conference in a communication adopted on 1 June 200140. This document
summarises the measures which have already been taken in the European Union to
combat racism, and demonstrates what can be achieved by a group of states acting
together at a regional level. The EC budget (European Initiative for Democracy and
Human Rights) contributed €3 . 7m i l l i o nt ot h eW o r l dC o n f e r e n c et oe n c o u r a g et h e
participation of NGOs and of Least Developed Countries in the regional preparatory
39seehttp://europa.eu.int/comm/external_relations/human_rights/doc/ghd12_01.htm
40COM (2001) 291 of1.6.2001
39events and in the World Conference itself. Funding was channelled through the
OfficeoftheHighCommissioner for HumanRightsandtheCouncilofEurope.
The Commission actively contributed to the 57thsession of the Commission on
Hum anRi gh tsi nGenev aan dth e56thThird Committee ofthe UN General Assembly
in New York, covering Social, Humanitarian and Cultural Affairs.
c) Electionobservation
In the field of Electoral Observation, the Council adopted conclusions on the
Commission Communication on Election Assistance and Observation on 31 May
200141, welcoming the Commission document as an important contribution to a
coherent EU policy in such a field. The Council indicated that election support was
an important element of the EU overall contribution to democratisation and
sustainable development in countries beyond the European Union. Specific
mechanisms for co-operation among EU institutions in election observation were
also outlined in the document. The European Parliament also endorsed the
Commission’s new approach to Election Observation in its Resolution of 14 March
2001. Eight election observation missions were undertaken in 2001: Guyana, Peru,
East Timor, Nicaragua, Bangladesh, Sri Lanka, and Zambia. Needs assessment
missions were carried out in Nicaragua, Togo, Cambodia, Colombia, Congo
Brazzaville, Bangladeshand East Timor.
d) Programmingoffunding
The approach developed in the Communication was put into practice in the 2002-
2004 programming document on the European Initiative for Democracy and Human
Rights (EIDHR) adopted by the Commission on 20 December 2001. In the light of
these requirements, this programming document presents a ‘response strategy’ to
enhance the impact of EIDHR, and examines the best ways of delivering assistance.
This is done by targeting a limited number of thematic priorities and 29 ‘focus’
countries.
e) Dialogue withNon-GovernmentalOrganisations (NGOs)
The dialogue with Non-Governmental Organisations has been developed, in
particular through the conference held in Brussels on 28 and 29 May 2001 on ‘The
role of Human Rights and Democratisation in Conflict Prevention and Resolution’
and through the AnnualHuman Rights’ Forum held in Brussels on 21/22 November
2001. The forum focused on the roles and responsibilities of state and non-state
actors, on the means of implementing Human Rights’ policies at bilateral and
multilateral level, on the types, conditions, objectives and evaluation of the Human
Rights’ dialogues and on the evaluation of the conference report42and of the Human
Rights fora held so far.
2.6.2. Gender Equality
The mainstreaming of gender equality in Community development co-operation is a
key element in the pursuit of sustainable development and is therefore a priority for
41COM (2000) 191 of11.4.2000
42seehttp://europa.eu.int/comm/external_relations/human_rights/conf/cp05_01.htm
40the Commission. This builds on the mainstreaming commitment made by the EC and
partner countries in the Fourth World Conference on Women in Beijing in 1995 and
the subsequent follow-up to the Beijing Declaration and Platform for Action43.
In 2001, the main thrust was to get the Programme of Action for the Mainstreaming
of Gender Equality in Community Development Co-operation of June 200144
completed and adopted byCouncilon 8 November 2001. To combat the well-knownphenomenon of policy evaporation, i.e. to close the gap between policy and
implementation, the Programme of Action proposes building internal capacity
through training, clarifying roles and responsibilities, developing methods and
indicators and establishing monitoring systems to follow implementation more
closely.
The programme has chosen a tripartite strategy to achieve these objectives, with a
five year timeframe (2001-2006):
•to mainstreamgender considerations at the countrylevel;
•to integrate gender considerations in all six priority areas of Community
development policy;and
•to build gender competence at allrelevant levels (headquarters and delegations) to
supportthese processes.
The EC budget lines allocated to gender
45have been a key instrument in introducing
the mainstreaming concept. The funds have proved been both catalytic and strategic.
The aim is to build capacityin the socialsectors withthe assistance of civil society in
the partner countries.
An evaluation of the Council Regulation of 199846on ‘integrating gender issues in
development co-operation’ and its financial framework B7-6110 and B7 6220 has
been launched and will be completed in2002.
A review of40 Country Strategy Papers (CSPs) was undertaken in order to assess to
what extent mainstreaming of gender equality in development co-operation had been
taken into account inthe programming process. It was found that:
•gender was mentioned as a ‘cross-cutting theme’, but the concept of
mainstreaming gender equality was hard to discern;
•the focus was on women and women’s situations, and analysis on men and boys
was missing;and
•gender was mentioned in the context of education, health and Human Rights
whereas sectors that received the bulk of EC funds (transport and macro-
economic support) were gender blind.
Further monitoringand methodologicalworkisrequiredtoimprovethesituation.
43seehttp://europa.eu.int/comm/employment_social/equ_opp/beijingquesen.pdf
44COM (2001) 295 of21.6.2001
45B7-6110 and for 2001 B76220amountingto €2.2million
46CouncilRegulation ECNo2836/98
412.6.3. Environment
High rates of environmental degradation continue to undermine prospects for long-
term economic and social development and often offset short-term gains in poverty
reduction. Environmental deterioration, including depletion of natural resources,
continues apace in developing countries. Soil erosion and land degradation, loss of
forests, habitats and biodiversity, depletion of fish stocks and pollution represent
seriouspermanentthreatsto sustainabledevelopment inmost countries. Furthermore,
developing countries are likely to be particularly vulnerable to the impact of global
climate change, despite their smallrelative contribution to this phenomenon.
In view of this, the Commission – in partnership with the UN Development
Programme, the World Bank and the UK Department for International Development
– has initiated a process to reflect on linkages between poverty and the environment,
and ways to reduce poverty and sustain growth. A concept paper, considered as a
‘work-in-progress’, will be subject to broader discussions in the context of the 2002
JohannesburgUnitedNations WorldSummit onSustainableDevelopment.
One ofthe major accomplishments in2001 was the formulation ofan EC strategy for
‘Integrating the Environment into EC Economic and Development Co-operation’.47
This put an emphasis on links between poverty reduction and the environment, andaimed to integratethe environment into the six priorityareas ofEC development co-
operation. One of the important aspects of this strategy was the commitment to the
preparation of an environment integration manual, a draft version of which was
produced in 2001. Furthermore, a number of environmental training courses were
given in2001 to EuropeanCommissionstaffand localstakeholders.
One of the constraints on the Commission’s activities in this area is the lack of
attention on the part of some developing countries to the protection of their national
environment. This has made it difficult for the Commissionto ensure that appropriate
attention is given to this issue in the programming dialogue. One of the ways that the
Commission tries to strengthen environmental dialogue with developing countries is
the promotion of specific opportunities. Unfortunately, this has not produced
encouraging results so far. The Commission has also focused on high level political
commitments totake action forward inthis area inthe partner countries.
In 2001, the Commission made substantial contributions to a range of Multilateral
Environmental Agreements. It adopted four Biodiversity Action Plans, including a
Biodiversity Action Plan for Development and Economic Co-operation.
48The
Commission also played a keyrole in ensuring the success of the negotiations in the
context of the UN Convention to Combat Desertification49(which issued a keypaper
for the World Summit on Sustainable Development preparations) and of the Bonn
and Marrakech agreements (Kyoto Protocol), which contained items of particular
relevance for developing countries (Clean Development Mechanism and Technology
Transfer).
47SEC (2001)609of10.04.2001
48COM(2001)162of27.03.2001
49see www.unccd.org
422.6.4. Conflict Prevention
Conflict prevention has been high on the political agenda of the EU in 2001. There
has been some fruitful debate and concrete actions proposed and implemented to
develop further the Union’s capacity in this field. The Commission adopted a
Communication on Conflict Prevention,50in April 2001. This set out a new strategy
in this field and put forward important recommendations for action. Concrete results
are already visible.
In terms of the mainstreaming of conflict prevention in EU policies and instruments,
Country Strategy Papers (CSPs) have been reviewed from a conflict prevention
angle. This means that risk factors have been systematically checked during the CSP
drafting process. For that purpose, the Commission’s geographical services used
conflict indicatorsthat were developed during 2001 incollaborationwiththe Conflict
Prevention Network. The indicators look at issues such as, inter alia, the balance of
political and economic power, the control of security forces, the ethnic composition
of the government (for ethnically-divided countries), and the potentialdegradation of
environmentalresources.
On the basis of this conflict analysis, it has been possible to draw more attention in
the CSPs to those underlying causes of conflict that external aid or other EU
instruments should target. At the programming level, the Commission’s intention is
to put more emphasis on strengthening the rule of law, supporting democratic
institutions, developingcivilsocietyand reforming the securitysector. This approach
is critical both to eradicating conflict and to preventing its re-emergence. It is also
consistent with the Commission’s renewed emphasis on institution building as part
oftheEC’sdevelopment policypriorities.
In post-conflict situations, peace-building initiatives are essential for ensuring a
lasting peace. Where the situation has allowed, the Commission has begun to engage
more substantially in rehabilitation activities as well as in traditional demobilisation,
disarmament and reintegration programmes (DDR). A good example is the support
given by the European Commission in 2001 to the multi-donor Trust Fund for DDR
inSierra Leone.
The Commission is actively participating in many international initiatives to tackle
‘cross-cutting issues’ which may create tensions or conflicts. For example, in 2001
the Commissiontooka much more active role in the Kimberleyprocess, aimed at the
establishing an international control regime for the import and export of rough
diamonds. Following the politicalagreement reached at Gaborone in November 2001
between the participants in this process, the Commission is now launching the
preparatory work for the full implementation by the Community of the control
regime inthe courseof2002.
Concrete recommendations have been put forward in the Communication on Conflict
to increase EU capacity to react quickly to nascent conflicts, notably to improve
early warning mechanisms and CFSP instruments such as political dialogue or the
use of EU Special Representatives. At the Community level, the Commission is in
the process of reforming its instruments to ensure a swift Community reaction to
crisis or pre-crisis situations. An important step was taken with the adoption this year
50COM (2001) 211 of11.04.2001
43of a Rapid Reaction Mechanism (RRM)51, allowing for speedy initiatives in peace
building, reconstruction and development. The RRM is now fully operational and is
being used, in particular in Former Yugoslav Republic of Macedonia, Afghanistan
and Congo, to bring a host of measures to bear quickly on a conflict situation, where
these would previouslyhave beensubject to more cumbersome procedures.
Conflict prevention is too big a task for a single organisation. International co-
operation is crucial. Only effective coordination with international partners can
achieve realprogress. Following KofiAnnan’s visit to Brussels in May2001, and the
adoption by the General Affairs Council of a new framework for co-operation with
the UN on conflict prevention and crisis management52, contacts between the EC and
the UN have been significantly enhanced. For example, a joint assessment mission
was carried out in the summer of 2001 to the Great Lakes region to prepare for
possible action on disarmament, demobilisation, and reintegration. Similar
frameworks are being studied for co-operation with other organisations active in the
field of conflict prevention, such as the Organisation for Security and Co-operation
in Europe.
51CouncilRegulation (EC)381/2001 of26 February2001
52ConclusionsfromtheGeneralAffairs'Council of11 June2001
443. IMPLEMENTATION : HORIZONTAL INSTRUMENTS
The European Community has developed a series of instruments to complete the range of
actions covered by the existing geographical programmes. Specific budget lines and legal
bases were adopted in order to put these “horizontal” policies into action. This chapter
outlines activities in2001 inthe following areas:
•HumanRights and Democracy
•Foodsecurity
•Health, inparticularpoverty-relatedillnessandreproductive health
•Drugs
•Relief, rehabilitationanddevelopment
•Environment
•Partnerships withNGOs
3.1. European initiative fordemocracy and Human Rights
Chapter B7-70ofthe budget entitled “European initiative for democracy and Human
Rights” (EIDHR) supports actions inthe Human Rights, democratisation and conflict
prevention fields. These operations must essentially be executed in partnership with
NGOs and international organisations. Council Regulation Nos 975/199953and
976/199954constitutethe legalbasisoftheseactivities.
The EIDHR supplements the Community programmes executed with governments
(EDF, Tacis, ALA, MEDA, CARDS, Phare, etc). It also represents a form of “risk-
capital fund for Human Rights” allowing initiatives to be launched on a pilot or
experimental basis. It can be used in the absence of the host country’s consent or
when the main Community programmes are not available for other reasons - for
example, inthe case ofsuspension. In certain regions, it provides the sole legal basis
for some activities, including the promotion of political and civil rights, election
observationand conflict resolution initiatives.
The priorities of the EIDHR for 2001 were drawn up by the Commission.55The
objectives focus on a small number of thematic sectors by region. The
implementation of the Initiative is also in line with the Commission Communication
of 8 May 2001 on the European Union’s role in promoting Human Rights and
53Council Regulation (EC) No 975/1999 of 29 April 1999 laying down the requirements for the
implementation of development co-operation which contribute to the general objective of developingand consolidating democracy and the rule of law and to that of respecting Human Rights andfundamental freedoms.
54Council Regulation (EC) No 976/1999 of 29 April 1999 laying down the requirements for theimplementation ofCommunityoperations
55Priorities and Guidelines for the implementation of the 2001 European Initiative for Democracy &Human Rights(EIDHR) Brussels, 6June2001-SEC(2001)891http://europa.eu.Int/comm/external_relations/human_rights/doc/sec01_891.pdf
45democratisation in third countries56which is designed to develop a more strategic
approachtothe Initiative.
In 2001, some €110 million was available to support actions in the Human Rights,
democratisationand conflict prevention fields.
As in previous years, three types of projects were used to implement the EU’s
strategyinthe areas inquestion:
Projects identified by call for proposals : as a result of two general calls, 93
projects obtained a grant, following notification or consultation of the “Human
Rights” Committee set upbyCouncil Regulation Nos 975 and 976/1999. Atotalof €
59 millionwas allocatedto the projects selected.
Dedicated projects are systematically used for projects drawn up with international
and regional organisations, including UN specialised agencies and the Office of the
High Commissioner for Human Rights, the Council of Europe and the OSCE -
ODIHR. They are identified by the European Commission as projects that pursue
specific objectives that cannot be achieved by means of a call for proposals. €36
millionwas earmarked for these projects.
Microprojects are used to finance democratisation projects with a budget ranging
from €3 000 to €50 000. They are designed to give extra support to local civil
societyinitiatives. Theyare managed directlybythe Commission delegations and are
selected bylocalcalls for proposals.
In 2001, microprojects totalling €12 million were selected in south-east Europe
(Albania, Bosnia-Herzegovina, Croatia, Federal Republic of Yugoslavia, and
FYROM), in the new independent states (Armenia, Belarus, Georgia, Kazakhstan,
Kyrghyztan, Moldavia, Russia, Tajikistan and Ukraine), in Latin America (Colombia
and Mexico), in south and south-east Asia (Cambodia, Indonesia, Nepal and
Pakistan), in West Africa (Nigeria and Côte d’Ivoire), in Central Africa (Democratic
Republic of Congo), in Sudan, the Middle East (Israel, West Bank and the Gaza
Strip), inHaiti, Turkeyand Zimbabwe.
3.1.1. The main priority areas
Onthe basis ofthe programming document adoptedbythe Commission57for 2001, €
6 million was allocated to the promotion and defence of Human Rights and
fundamental freedoms (protection of civil, political, economic, social and cultural
rights, minorities, ethnic groups and indigenous peoples; institutions, including
NGOs involved in the protection, promotion and defence of Human Rights;
rehabilitationcentres for the victims oftorture;education, training and information in
the field of Human Rights; equal opportunities and the fight against racism and
xenophobia;freedomofopinion, expressionandconscience).
€35 million was allocated to support for democratisation and strengthening the rule
of law: independence of the judiciary, separation of powers, improved governance
etc.
56COM(2001)252 final.
57http://europa.eu.int/comm/external_relations/human_rights/doc/sec01_891.pdf
46€17 million was allocated to conflict prevention and the restoration of civil peace.
These projects will be implemented in: Latin America (Columbia, where the EU has
given steady support to initiatives aimed at bringing about a peaceful settlement to
the conflict there and in Guatemala; the Caucasus region; the former Yugoslavia,
Slovenia and Albania; Africa (Sudan, Kenya, the Democratic Republic of Congo,
Rwanda and Somalia); Israel and Palestine; and Afghanistan and Pakistan. The
projects are part of the effort to implement the Commission Communication on
Conflict Preventionof11 April2001.58
Support for the activities of international criminal tribunals and the setting-up of theInternational Criminal Court amounted to
€3 million. Measures taken under the
Initiative count as implementation of the EU common position on the international
criminal court adopted in June 2001.59The Commission supported the setting up of
the Court through regional networks, NGOs and technical assistance for
implementation of legislation and technical co-operation, for instance. The
Commission also made a contribution to the expense of collecting evidence
(missions, inquiries, travel of witnesses, exhumations, etc.) for the tribunals for
Rwandaandtheformer Yugoslavia.
€5.95 million was allocated to support for rehabilitation centres for the victims of
torture in third countries and €6 million was allocated to rehabilitation centres for
the victims of torture and their families within the EU. These projects constitute
implementationofthe EU guidelines, adoptedbythe Council(General Affairs) on 21
April 2001 concerning policy towards torture and other cruel, inhuman or degrading
punishment ortreatment.
Efforts were made to integrate the gender equality aspect into the implementation of
the EIDHR by systematically analysing all the projects selected according to their
impact onthis aspect.
58COM(2001)211final
59OJ L155, 12.6.2001, p.19
47EIDHR priority areas in 2001
Field Amount
( €million)
Education, training and information inthe HumanRights field 2.600
Fight against racism and xenophobia and protection of minorities
and indigenous peoples6.000
Freedom of opinion, expression and conscience and the right to
use one’s own language0.420
Strengthening respect for the rights ofchildren601.100
Abolitionofthe deathpenalty 0.880
Promoting pluralism at political level and in civil society 4.400
Promoting good governance, particularly by supporting
administrative accountability and the prevention and combating of
corruption1.770
Promoting the participation of the people in the decision-making
process at national, regional and local level, in particular by
promoting the equal participation of men and women in civil
society, economic life and politics4.340
Promoting respect for Human Rights and democracy with a view
to conflict preventionand the restorationofcivilpeace17.000
Support for democratic transitionand the observationofelections 9.960
Preventionoftortureandrehabilitationofvictims615.950
As regards education, training and awareness-raising in the Human Rights field, the
EIDHR channelled €2.6 million into university programmes on Human Rights and
democratisation. Three new regionalmasters inHumanRights weretherefore created
in south-eastern Europe, South Africa and Malta. They allow students from each of
these regions to specialise in the Human Rights field. These courses follow the
model of the European masters in Human Rights and democratisation launched in
1997.
The Commission’s activities in the field of support for democratic transition and
election observation are based on its Communication on EU election assistance and
observation of April 2000,62the Council conclusions of 31 May 2001.63All these
documents stress the fact that an election observation mission should be deployed on
thegroundbefore, duringandafter ElectionDay.
In 2001, the EIDHR financed EU election observation missions at the request of the
governments of Bangladesh, Cambodia, Nicaragua, East Timor, Zambia and Sri
Lanka. In Pakistan, where elections will be held in 2002, a project is designed to
60Furthermore, €1 million from budget heading B7-626 “Campaign against sex tourism in non-member
countries”,wasallocated toan international campaignagainst childsex tourism.
61Furthermore, 7 centres located in the European Union also received a grant totalling €60 0 00 0 0f r o m
budget heading B5-813 (this appropriation covers support for the establishment and maintenance ofrehabilitation centres for torture victims and their families and other organisations offering concretehelp to victims of Human Rights abuses).
62http://europa.eu.int/comm/external_relations/human_rights/eu_election_ass_observ/index.htm
COM(2000)191finalof11.4.2000.
632352ndCouncilmeeting-Development-Brussels, 31May2001.
48restore the general public’s confidence in the institutions and in the electoral process
in order to raise their political awareness and their participation in the elections.
Finally, the “European Network for Electoral and Democracy Support” project
received a grant ofover €1.6millionto consolidate the Europeannetwork born out of
the EUEOPproject (EuropeanUnionElectoralObservationProject).
EIDHR Budgetary Execution 2001
%ofTotalAmount Allocated tothe EIDHR
(by region)
Region Amount in €million %ofT otal
CEEC &NIS 18.454 16.51
ACP 19 049 17.05
LatinAmerica 9.100 8.14
MEDA 9.516 8.52
Asia 11.101 9.93
World-wide (including torture) 23.530 21.06
EU 6.000 5.37
Micro 12.000 10.74
Technical Assistance 3.000 2.68
TOTAL 111.750 100
49EIDHR COMMITMENTS 2001
AMOUNTS ALLOCATED TO PROJECTS (By Region)
Region Amount in € %o fT o t a l
SouthEasternEurope:Balkans 11 155302 12,32
EasternEuropeandCentralAsia 8 409661 9,29
ACP 19 242726 21,26
LatinAmerica 15 408732 17,02
SouthMediterranean, Near MiddleEast 10 762574 11,89
Asia 12 862460 14,21
World-wide 12 681214 14,01
TOTAL 90 522669 100
14,21%
11,89%
17,02%21,26%9,29%12,32%14,01%South Eastern Europe:
Balkans
Eastern Europe andCentral Asia
ACP
Latin America
South Mediterranean,Near Middle East
Asia
World-wide
3.2. Food Security
3.2.1. Performance in 2001
In2001 the food aid and food securitybudget amounted to €454 million. The aimof
this Community programme was to integrate the food security requirement more
fully in the overall development strategy of the beneficiary countries referred to in
the country strategy papers – and in the poverty reduction strategy papers. The
programme also focused on increased ownership of the programmes and policies by
the nationalpartners: governments and civil society.
3.2.2. Breakdown by form of intervention
The priority given to direct food aid was confirmed in 2001. The Commission
attaches growing importance to food aid strategy. For 2001, the Commission’s food
aid programme earmarked €201.8million for direct food aid granted to governments
in the formof financialaid and support operations, including €74 million for budget
support.
50As umof €25.2 million was reserved for technical assistance on the ground, follow-
up and monitoring missions, the financing of RESAL (European network for food
security), monitoringoffoodaidandpriceadjustmentofpurchasesoffoodstuffs.
Every effort was made to follow the recommendations set out in the general
evaluation of three years of action of food security policy. The priorities were based
on optimising analysis capacities with the support of RESAL. Food aid in kind was
reserved for vulnerable people in countries in crisis and for serious food crisis
situations. It providesasafetynetto complement emergencyoperations.
Allocations to NGOs consisted of support actions for food security (funding) that
were the subject of direct contracts between the Commission and NGOs amounting
to €60 million while allocations of food aid, tools and seeds to EuronAid amounted
to €76 million. In the interests of consistency and greater effectiveness, NGO
projects were incorporated in the national food security strategy of the intervention
countries.
Programming was done jointlywith ECHO in shared intervention countries.
3.2.3. Intervention countries
These countries are included on the list of eligible countries under Regulation No
1292/96. Theyare divided intotwo groups:thosethat receive structuralaid and those
that are ina crisis or post-crisis situation. The first group includes countries classified
as: least developed (LDC), low-income food-deficit countries (LIFDCs), with a high
food insecurity index and where the government is keen for a coherent, long-term
food security strategy. The second group includes countries in a crisis or post-crisis
situation (linking relief, rehabilitation and development: LRRD). Interventions in
these countries are less structural and mostly involve supplying food aid, tools and
seeds, together with additional technical and financial support to prevent the risk of
famine or help rebuild the economic and social fabric damaged by political or ethnic
conflict.
In 2001, the first group included 21 countries: Albania, Burkina Faso, Cape Verde,
Mauritania, Niger, Ethiopia, Eritrea, Madagascar, Mozambique, Malawi, Yemen,
Bangladesh, Georgia, Armenia, Azerbaijan, Kyrgyzstan, Moldova, Nicaragua,
Honduras, Peru and Bolivia. The second group included 18 countries: Afghanistan,
Cambodia, India, Pakistan, Laos, Liberia, Sierra Leone, North Korea, Somalia,
Sudan, Democratic Republic of Congo, Rwanda, Angola, Ecuador, Palestine,
Tajikistan, Montenegro et Haiti.
Concentrating operations on a limited number of countries means a critical mass can
be achieved in each country, thereby increasing the impact of aid on improving food
security.
3.2.4. Relations with the other donors
TheCommunityfoodsecurityprogramme isbasedonfourmainprinciplesofaction:
– coordinating the programme’s interventions with those of the other donors,
startingwiththeMemberStates;
– taking part indrawing up a coherent framework for aid inthe recipient country;
51– pursuing discussions and analysis to help with implementing the programme;
– focusing interventions in a small number ofrecipient countries.
3.2.5. Coordination with the Member States
The desire for consistency and coordination in EU interventions and those of the
Member States exists at all levels at which the food security programme is
implemented. Consistency is systematic when programmes are defined, because it is
the Member States which, within the EU institutions, decide on the strategic policy
outlines of the programme and funding. Furthermore, there is a code of conduct for
Member States andthe Commissionrelating to foodaid.
In the field, coordination takes place on a case-by-case basis, as a function of donor
involvement and the nature of the programmes implemented. In Mozambique, for
example, the Commission is coordinating with a number of other Member States as
part of PROAGRI, a sectoral programme to strengthen the capacity of the Ministry
ofAgriculture.
3.2.6. Transatlantic dialogue
In 1995, the European Commission and USAID (US Agency for International
Development) launched a new stage ofthe transatlantic initiative, the aimof which is
to step up their coordination in various fields. With regard to food security, this
dialogue takes place in the field in seven pilot countries: Bangladesh, Bolivia,
Ethiopia, Haiti, Kyrgyzstan, Malawi and Mozambique. A food aid analysis table has
been jointly drawn up and includes the following points: means allocated;
consultation to assess needs and develop a targeting strategy; factors of long-term
food security; assessment: frequency, criteria, problems encountered and joint
assessment.
In Haiti, this table was used positively to assess the EU and US food aid
programmes. In Kyrgyzstan, EuropeAid/USAID coordination led to harmonised
intervention by both donors and a reduction in the distorting effects of the US food
aid on local markets. In Bangladesh, it led to the joint production of an impact study
onincome-producing programmes for vulnerable populations.
2001 – ALLOCATIONS BY IMPLEMENTING PARTNERS
Partners Euro M Indirect Euro M
Direct 180,24 WFP 98,00
Indirect 250,94 Euronaid(NGO) 76,00
Other 22,81 NGO 60,00
Total 453,99 UNRWA 15,00
FAO 1,94
Total 250,94INDIRECT AID
52LIST OF COUNTRIES
Cty SumOfValue
Angola 28,425,191
Ethiopia 25,386,971
Georgia 25,000,000
NorthKorea 24,569,523
Bangladesh 24,500,000
Afghanistan 20,548,177
Malawi 18,000,000
Eritrea 17,342,773
Mozambique 14,800,000
Sudan 13,653,576
SierraLeone 13,389,602
Yemen 12,000,000
Burkina Faso 11,532,345
Armenia 10,000,000
Kyrgyztan 10,000,000
Somalia 9,451,499
Honduras 6,696,996
Ecuador 6,000,000
Cambodia 5,707,110
Tajikistan 5,662583
Peru 5,000,000
Mali 4,740,391
Gaza 3,792,572
DR Congo 3,445,775
Jordan 3,119,151
Lebanon 2,894,354
Niger 2,612,492
West Bank 2,609,162
Syria 2,584,760
ElSalvador 2,210,685
Bolivia 2,145,901
Haiti 2,000,000
Zambia 1,602,071
Liberia 1,258,665
Laos 1,060,764
India 999,724Nicaragua 891,312
Guatemala 447,350
2001 – GEOGRAPHICAL DISTRIBUTION OF ALLOCATIONS
Geographicalzones EuroM ACP M Euro
ACP 167 ,64 East Afica 65 ,83
Asia 77 ,39 SouthAfrica 62 ,83
LatinAmerica 23 ,39 Central Africa 6 ,06
NIS 50 ,66 WestAfrica 30 ,92
Europe 0 ,00 IndianOcean 0 ,00
Mediterranean & Middle East 27 ,00 Caribbean 2 ,00
Other 22,81 Total 167,64
To bedistributed 85,10
Total 453 ,99ACP
53DISTRIBUTIONBY PROGRAMMEIMPLEMENTING PARTNER
1993-2001
Type of aid ( €m) 1993 1994 1995 1996 1997 1998 1999 2000 2001
Direct aid 137,41 183,18 202,16 272,15 287,28 271,91 258,55 196,06 180,24
NGO 160,13 154,51 214,38 106,51 87,21 113,59 85,00 108,05 136,00
WFP 158,47 144,16 137,54 111,45 123,87 141,47 104,14 90,00 98,00
UNHCR 15,66 10,55 12,74 - - - - - -
ICRC 20,96 20,27 23,04 - 10,57 9,21 - - -
Other organisations 38,14 21,23 13,63 13,40 11,91 12,29 25,50 15,60 16,94
Other (TA, price adjust.) 43,23 55,20 42,81 56,65 15,60 29,88 31,79 48,70 22,81
TOTAL 574,00 589,10 646,30 560,16 536,44 578,35 504,97 458,41 453,99Directaid
0100200300400
1993
1994
1995199619971998
1999
20002001
GEOGRAPHICAL DISTRIBUTIONOF ALLOCATIONS- PROGRAMMES 1993-2001
Geographical area ( €m) 1993 1994 1995 1996 1997 1998 1999 2000 2001
Europe ---- 10,76 0,22 26,90 11,00 -
ACP 329,97 365,34 371,61 248,22 248,02 239,09 226,97 236,83 167,64
Mediterranean &MiddleEast 74,21 51,80 43,33 34,67 22,91 30,11 20,55 24,80 27,00
Asia 61,99 64,17 121,01 82,18 102,01 154,95 80,73 61,34 77,39
NIS --- 69,00 62,69 51,10 49,87 41,43 50,66
Latin America 55,63 49,91 67,54 69,44 61,57 72,98 55,56 34,31 23,39
Reserve and notdistributed 8,97 2,68 ---- 12,61 -85,10
Other(TA, price adjust....) 43,23 55,20 42,81 56,65 15,60 31,04 31,79 48,70 22,81
TOTAL 574,00 589,10 646,30 560,16 523,56 579,49 504,97 458,41 453,99ACPcountries
0100200300400
1993
19941995
199619971998199920002001
3.3. Health, AIDS andPopulation
3.3.1. Community response to the problem
Improving the health and welfare of people in the developing countries, the
integration of the developing countries into the world economy and the fight against
poverty are an integral part of Community policy (Articles 179 and 177 of the
Treaty).
TheCommission, inconjunctionwiththe Member States, has graduallyestablished a
coherent set of aims and principles governing the choice of activities and the
allocation of means to problems related to the major diseases and reproductive
health.64
3.3.2. Objectives
a) Poverty-related diseases
– Maximise the impact of existing interventions, services and commodities
in the fight against the main transmissible diseases affecting the poorest
populations;
– Increasing access to essential medicines;
– Stepping up research and development, especially into vaccines,
microbicides and innovative treatments.
b) Reproductive health
– Guarantee the right of women, men and adolescents to good reproductive
and sexualhealth;
– Allow women, men and adolescents access to a full range of care,
services and safe and reliable products concerning reproductive and
sexualhealth;
64http://europa.eu.int/comm/development/aids/html/policiesnf_fr.htm
54– Reduce the maternalmortality, especially in the countries and population
groups where it is highest.
3.3.3. Activities in 2001and areas of intervention
In recent years, greater attention has been paid to health problems in the developing
countries, especiallyto the major so-called poverty-related diseases.
A Commission Communication concerning the programme of accelerated action on
these diseases was adopted bythe Councilin May2001.65
The process of selecting proposals received from the call for proposals, published inJanuary 2000, and which had already served as a basis for mobilising credits for a
first setofproposals in 2000, was continued. Ofthe 295 proposals initially submitted
112 were examined.
16 projects were accepted in 2001 for a budget of
€20.7 million, with the following
breakdown:
AIDS: 11 projects for €15.2 million and population : 5 projects for €5.5 million.
Several of these projects (6) aim to tackle the problem of HIV mother-to-child
transmission. Others focus on the prevention of AIDS by means of better care for
people affected by sexually transmitted diseases (3) or by education and training
programmes (3). Three projects concern maternalhealth.
This call for proposals was a first in the context of these budget lines in that it was
addressed to a large range of actors: NGOs, local and national authorities, research
institutes and communityorganisations, public and private services.
The actions undertaken in 2001 therefore included the implementation and follow-up
of activities launched during that year and those of previous years. In December
2001, over 90 projects worthalmost €100millionwere being followed-up.
3.3.4. The prospects: the Commission’s active commitment
The Commission’s participation in 2001 in defining the guidelines for a new Council
Regulation on combating diseases (HIV/AIDS, Tuberculosis and Malaria) and
reproductive health, the creation of a Global Fund for the fight against these three
diseases and the Commission Communication on health and poverty66will help to
define betterthe role and place ofthematic budget headings concerning health.
The priorities and measures to be applied in the future centre around 4 points:
– bettercommunicationaboutthe interventions supported bythe budget headings
in order to reinforce their impact on improving the quality of the services
provided to people and support for changes in healthpolicies,
– in-depthanalysis ofthe context inwhich interventions are implemented,
65COM(2001) 96 of 21.2.2001 adopted by the Council on 14.5.2001, 2346th meeting of the Council –
General Affairs .
66COM(2002)129of22.3.2002.
55– applying know-how onthe ground and ownership of it by localstakeholders,
– establishing an operational link between the fight against specific diseases and
reproductive healthand support for development ofthe healthsystem.
3.4. Fighting againstdrugs
Prevention, treatment, reintegration of drug addicts into social and working life,
epidemiological studies, combating money laundering, creation of new laws etc. The
questions raised by drug trafficking and consumption require targeted responses that
fit in with the European Union’s global strategy.
3.4.1. Activities in 2001
In accordance with the European Union’s Action Plan, Community co-operation is
centred onthree major areas:
•an intervention balanced betweenreductionofdemand and ofsupply;
•the principle of “shared responsibility” between producer countries, transit
countries and consumer countries;
•theincorporationofdrugscontrolintodevelopment co-operation.
With regard to the reduction of supply, the Commission has organised its operation
around two major trafficking routes that supply the European Union. In order to
reinforce the impact of European action, the Commission has agreed on an
information exchange system with the Member States in order to step up European
coordination.
The Commission’s intervention is often based on the expertise of Member States’
national administrations. This mobilisation of European expertise fosters relations
between beneficiary countries and Member States, which is welcome because of the
internationalnature oftrafficking.
On thecocaine route ,i nLatin America ,the EC recently began assisting the
Venezuelan government to set up a national drugs observatory and has allocated €2
million to this. In Colombia, the EC wishes to play a major role in the peace process
and it contributes to this by means of alternative programmes ( €30 million out of a
total of €105 million). In the Caribbean , the EC has contributed some €23 million
to the Barbados action plan from heading B7-6310 and from the European
Development Fund, which includes a set of programmes covering all aspects of the
fight against drugs. This initiative is the result of a joint approach on the part of the
Caribbean countries, the EU, the USA and the UN. The Community action is
designed to reinforce the fight against money laundering and cocaine trafficking by
stepping up maritime surveillance and setting up central coordination units that
encompass the police, customs and the armed forces.
On theheroin route, various schemes to combat trafficking have been undertaken in
Central Asia and in the Caucasus. Demand reduction programmes are in the
pipeline. The EC is preparing a new project focused on Iran, designed to prevent
drug addiction and to train magistrates. It also finances efforts to step up co-
operationbetweenthe countries ofCentralAsia, Iran, Pakistan and Turkey .
56Fordemand reduction, the Commission supports a global approach that goes well
beyond detoxification.
The Commission finances a set of programmes from heading B7-6310 and other
headings (regional) that support the development of networks of NGOs. These are
designed to provide drug addicts with a wide range of services - from basic medical
care to social, family and professionalrehabilitation and including detoxification and
reducing the risks attached to druguse, especiallyfor injecting drug users.
To provide a more appropriate response to the problem, it also intends to improve
third countries’ knowledge of the situation as regards drugs, by financing projects
to collate data in these countries. This approach is particularly important to enable
the beneficiary countries to define their needs more clearly and to participate in
projects in fullknowledge ofthe facts.
The Community also finances several programmes to combat money laundering
and is involved in the work done bythe OECD in this field.
3.4.2. Perspectives
In its Communication of8 June 200167on the implementation of the EU Action Plan
on Drugs, the Commission confirmed the importance given to assistance to non-EU
countries in the field of combating drugs. In this context, the Commission has
undertaken to focus the programming of anti-drugs action on the countries crossed
by the EU’s two main supply routes. The Commission will continue to develop
projects to step up coordination between the beneficiary countries and with the
Member States.
3.5. Linking relief, rehabilitation anddevelopment
•In April 2001, the Commission adopted a Communication on linking relief
rehabilitation and development (LRRD) The Commission has undertaken a
number of actions to implement the policy principles of Linking Relief
Rehabilitation and Development (LRRD) The Commission is in the process of
proposing further orientations and decisions tothat end, including:
– restructuring of budget lines and regulations to be used for linking relief
anddevelopment;
– establishing guidelines for ECHO’s exit strategies;
– establishing anagenda for improving its working methods witha view to
increasing its capacity for rapid interventions.
In 2001,ECHO’s mandate and role vis-à-vis the other Community instruments in
the field of external relations was further clarified with respect to its role in the so-
called “transition gap” between relief, rehabilitation and development (LRRD). As
outlined in the Commission Communication on LRRD ,68ECHO will focus on its
core mandate, while development co-operation will have to strengthen efforts to
67COM(2001)301finalof8.6.2001.
68Commission Communication on Linking Relief, Rehabilitation and Development – An assessment
(COM 2001(153) finalof23.4.2001).
57bridge the gap from the other side. In order to further enhance its transparency and
predictability, ECHO prepared a working paper in December 2001 to clarify its
general criteria for phase-outs and hand-overs. The working paper established these
criteria intwo steps:
1) bydefiningthe modalities for a smoothtransition fromhumanitarianassistance
torehabilitationanddevelopment, and
2) bylookingatthe maincontextualfactorsthatwillhaveanimpactonthe modus
operandifor phase-outs.
3.5.1. The main instruments
•Aid for uprootedpeople
An e wl e g a lb a s i s69came into force in 2001, under which action for Asia and Latin
America canbe programmed until2004.
Furthermore, as the convention currently in force between the European Community
and the United Nations Relief and Works Agencyfor Palestine refugees (UNRWA)70
is about to expire, the Commission has obtained a negotiating mandate from theCouncil to draw up a new Convention to last for 4 years.
As regards the ACP countries, Article 255 of the Lomé IV Convention allows
resources of the European Development Fund to be mobilised to assist uprooted
people inthesecountries.
•Rehabilitationschemes
EC policy in this field is governed by Council Regulation 2258/96 of 22 November
1996 on rehabilitation and reconstruction operations in developing countries
(published in OJ No L 306 of 28 November 1996). These operations: “of limited
duration and to be launched as quickly as possible without compromising the quality
of assessment, shall be designed to help re-establish a working economy and the
institutional capacities needed to restore social and politicalstability tothe countries
concerned and meet the needs of the people affected as a whole. The operations must
progressively take over from humanitarian action and pave the way for the
resumption of medium-term andlong-term development aid”.
•Actionagainst antipersonnelland mines
Although Community operations in this field have their own budget heading of a
general scope, they did not until now have a specific legal basis. Here again, the
adoptionofa legal basis
71that is valid until 2009 will help to increase the coherence
ofoperations bymeans ofmedium-termprogramming.
69Regulation (EC) No 2130/2001 of the European Parliament and of the Council of 29 October 2001 on
operations to aid uprooted people in Asian and Latin American developing countries, OJ L 287,31.10.2001, p3.
70EC-UNRWA Convention 1999-2001, CouncilDecision, OJ L261, 7.10.1999.
71Regulations (EC) No 1724/2001 and 1725/2001 of the European Parliament and of the Council of23 July 2001 concerning action against anti-personnel landmines in developing countries, OJ L 234,1.9.2001.
58•NGO cofinancing
Council Regulation No 1658/98 of 17 July 199872on cofinancing operations with
EuropeanNGOs is also an instrument for financing development operations that take
overfromhumanitarianoperations.
3.5.2. The main areas of actionin 2001
•Aid for uprootedpeople
Although operations in Latin America continue, new commitments in this field
primarilyconcernuprootedpeople in Asia in situations ofprolonged crisis. These are
people who come from Afghanistan, Burma/Myanmar, Sri Lanka and the Philippines
(Mindanao). The projects currently under way cover a wide variety of fields, ranging
from assistance to refugees in camps – generally implemented by the UNHCR – to
operations carried out by international and local NGOs working in the fields of
education, health, water supplies or rural development. Where the situation allows,
the emphasis is onreturning people totheir regions oforigin.
As a result ofthe deterioration ofthe situation on the ground in the Middle East, the
European Community has decided to increase its contribution to the activities of
UNRWA. Besides its annual allocation for 2001 ( €42 million), an additional
contribution of €15 million was mobilised for operations in the field of education
and primary health care for refugees in four geographical areas: West Bank, Gaza
Strip, Lebanon and Syria.
As regards the ACP countries, a convention of €25 million was signed with the
UNHCR for the voluntary repatriation of Burundian refugees currently in Tanzania
onthe basis ofArticle 255.
•Rehabilitationoperations
Rehabilitation operations are financed from various budget headings covering
different regions ofthe world (Asia, East Timor, Latin America, Mediterranean, New
Independent States and ACP countries). The projects funded take several forms and
cover very varied sectors, ranging from support for grassroots community
organisations to large-scale projects to rehabilitate infrastructure.
East Timor deserves special mention: Community support combined with the
international community’s efforts under the Trust Fund for East Timor is
contributing to the creation of an independent State. The fact that elections for the
constituent assembly went smoothly in September 2001 augurs well for the
continuationofthereconstructionprocess.
•Actionagainst antipersonnelland mines
Actionagainst antipersonnelland mines concerns the countries worst affected bythis
scourge. These operations cover both de-mining operations (Afghanistan, the
Balkans, Angola, Mozambique, Somalia, Laos), andthe establishment ofinformation
systems (Balkans) and institutionalsupport (Cambodia).
72OJ L213of30.07.1998p. 1.
593.6. Environment
The year 2001 has been very intensive in terms of activities carried out in the fields
ofConservationand Wildlife(C&W), Forestry(For)andSustainable Management of
Natural Resources (SMNR) with the implementation of 7 new programmes/projects
for a global amount of €5 51m i l l i o n ,a n dw i t ht h ea p p r o v a lo f4n e wp r o g r a m m e s
totalling €26 million.
Ongoing activities have been pursued, in particular in the Congo Basin, with the
ECOFAC programme and related activities co-ordinated by the strengthened
RegionalEnvironmental Unit based in Libreville. The duration of some programmes
planned to end in2001 has beenextended: Wildlife Tanzania, Wildlife vision Gabon,
Indian Ocean Regional Environmental Programme. The Regional SMNR in Western
Africa (AGIR, Guinea, Guinea-Bissau, Mali, and Senegal) has slowed down due to
insufficient internal consistency, and a global evaluation is about to be launched.
The main tangible outcomes of year 2001 are the increase by5 times of the totalarea
of the Odzala National Park (Congo Brazzaville) and of the Monte Alen National
Park (Equatorial Guinea) as well as the constructive continuation of the dialogue
with logging companies. Furthermore, it is importantto notethe establishment ofthe
Network of Protected Area of Central Africa (RAPAC) with the election of the
President and the organisation of the first meetings of the Board of Directors. The
willingness ofthe 5 world heritage sites in the Democratic Republic of Congo to join
the network and the new membership of The Zakouma National Park in Chad are
likelyto give a verypositive impulse to RAPAC.
The 9thEDF programming exercise has begun with particular emphasis on regional
programmes and the need to appoint a network of experts with regional tasks who
can support EC Delegations and the Commission in implementing environmental
policies and programmes.
Watermanagement has to be seen as a cross-sectoral issue to be incorporated into
development policiescentredonpovertyreduction(seesection2.5.3.)
Energyis recognised as an important crosscutting element in the elimination of
povertyand the achievement ofthe Millennium Development Goals. The strategy for
sustainable energy support emphasises the need to mainstream it into the social and
economic sectors (health, education, and enterprise development), as well as the
environmental and other benefits of increasing use of energy efficiency and
renewable energy. It also emphasises the importance of institutional capacity
building and policy support in the energy sector, as well as the necessity to enhance
partnerships betweenthe private and public sectors, and involve civilsociety.
A Working Group of the ACP-EU Joint Parliamentary Assembly on Renewable
Energy developed a resolution, adopted by the Assembly in 2001, recognising the
essential need for energy services in the fight against poverty, and calling inter-alia
for awareness-raising and capacity building measures for renewable energy. As a
follow up to the above resolution and in order to stimulate integration of sustainable
energy into 9thEDF programmes, a conference, for NAOs and key stakeholders, on
sustainable energy in ACP islands was organised by the Commission, in June 2001
in the Dominican Republic, to raise awareness and start the energy mainstreaming
process.
603.6.1. Activities in 2001
The financialallocations earmarked for the environment and forests are designed to:
•support global or regional initiatives, especially in connection with regional
conventions in the environmental field (climate change, biodiversity,
desertification) or internationalagreements;
•select, on a flexible basis, the partner countries (including middle-income
countries) that are of particular importance in the context of the fight against
environmental degradation in general, such as Mexico, Brazil or certain countries
inSoutheast Asia;
•launchpilot initiatives.
In2001, commitment appropriations amountedto €54 million, ofwhich €13 million
were appropriations carried over from 2000 to 2001 because of the late adoption of
the legalbases (the new regulations were adopted in November 2000).
Activities in 2001 were a continuation of those carried out in 2000. Essentially they
involved the management of 221 projects adopted in 2000 or earlier, with the
following geographical breakdown:
Environment Forests
Africa and Madagascar 49 46
Pacific - 2
AllACP States 6 -
LatinAmericaandtheCaribbean 22 53
Asia 8 16
Mediterranean 4 -
Global 6 9
Total 95 126
61In addition there are 29 projects selected following a call for proposals which
generated almost 640 funding applications, and 5 othertargeted projects
CallforProposals Environment Forests
Africa and Madagascar 1 5
LatinAmericaandtheCaribbean 5 11
Asia 3 4
Sub Total 9 20
Outside thecallforproposals
Africa and Madagascar 1 2
LatinAmericaandtheCaribbean 1
Asia 1
Subtotal 23
Total 11 23
3.7. Co-financing NGOs
The Commission cofinances operations in the developing countries and information
campaigns in the Member States with Northern NGOs. It also cofinances operations
to increase co-operation initiated bySoutherncivilsocietyactors.
The whole 2001 budget of €204 millionwas committed.
3.7.1. Cofinancing with European NGOs73
At 1 January2001, there were 1759 projects under way, plus 293 projects selected in
2001 from the 1 200 applications for cofinancing that were presented under the first
Call for Proposals (published inJune 2000).
On theground
These actions are proposed (exclusive right of initiative) by European NGOs (which
have their headquarters and decision-making centre in a Member State) and are
carried out either in the form of “projects” on the ground in the developing countries
or in the form of “Block Grants” when, for reasons of effectiveness, several micro-
operations are groupedtogether. Inthis case theyare referredto as “contracts”.
Generally speaking, therefore, the Commission cofinances projects and sets of
thematic operations aimed at poverty reduction in the most vulnerable countries to
thetuneof €176 millionannually.
73Budget headingB7/6000Regulation (EC) No1658/98.
62TABLETOTALCOST/EUPARTICIPATION
BYREGIONOFTHEBENEFICIARYWORLDin €
020.000.00040.000.00060.000.00080.000.000100.000.000120.000.000
Sub-Saharan Africa 34%
Caribbean7%
Pacific1%Asia22%
LatinAmerica 17%
CentralAmerica12%
Mediterranean7%
Dark: totalcost of the operations proposed; light: the share effectively cofinanced by
the Commission. The percentages given correspond to actual financing by
geographicalarea.
Comments: This analysis by area corresponds to the distribution of the poorest or
worst affected people; the reason for slight distortions is the exceptional operations
in Mozambique or Cuba during this period.
Development education
Like the operations described above, European NGOs also propose campaigns to
raise public awareness in the European Union. In 2001, the Commission analysed
132 applications, and selected 49 operations for cofinancing totalling €19.3 million.
Under the 2000 call for proposals, 21 operations were selected and financed out of
thetotalof61 presented in2000.
3.7.2. Decentralised co-operation74
Out of the 74 requests presented in 2000 and 2001, 19 grants were committed in
2001 for atotalof €5 million.
74Budget headingB7/6002Regulation (EC) No1659/98.
63CDC BYORIGIN OF CONTRACTANTS
Netherlands (2)
7%
Argentina(1)
5%Uruguay (1)
5%Chile (1)
4%Peru(1)
5%C o staR ica(1)
7%Guatemala(1)
7%Haiti (1)
10%Morocco(1)
2%Gambia (1)
2%Benin (1)
10%Vanuatu(1)
6%Germany(1)
12%
France(5)
18%
3.7.3. Other activities
– Publication of 2 new Calls for Proposals75at the end of December 2001 in
accordance with the guidelines approved by the Member State for the years
2002-2003.
– Drafting of the Cofinancing Info Guide,76which will be useful for the
appraisal, execution and evaluation of operations and in the context of the
devolution process, will help the Delegations to keep a firmer hand on follow-
up, monitoring and controlactivities.
As its design is firmly focused on the new technologies (Internet), users can have
instant and direct access to the relevant information, thereby fostering an effective
operationalapproachto combat povertyinthe developing countries.
Drafting the Programme Contract instrument
In accordance with the rationalisation policy adopted by the Commission following
the decision of 16 May 2000, in view of the proposal made by the NGOs, in
accordance with existing rules, especially to improve the quality and coherence of
long-term operations, a “call for programme contract ideas” was published at the
same time as the call for proposals for 2000.
75http://europa.eu.int/comm/europeaid/cgi/frame12.pl
76Availablesoon athttp://europa.eu.int/comm/europeaid/projects/ong_cd/index_fr.htm
6467 applications were registered totalling more than €300 million. A new evaluation
and selection procedure for this pilot cofinancing instrument is in the process of
being drawn up. 15 proposals, representing a total request of €83.5 million were
chosen for this experiment. A budget allocation of some €40 million will allow the
best programmes to be financed as from2003.
The Commission intends to participate in the seminars organised by civil society,
particularlytoevaluatethestart-upofthispilot instrument.
654. I MPLEMENTATION :THEREGIONS
4.1. Countries covered by the EC ExternalAssistance
The EC External Assistance covers all the regions in the world. The following sections show
the EC partnership and co-operation activities in all of them, under geographical bases. To
make reading easier, we display all of the countries of each region in these pages. The sub-
regionsare indicated, where relevant.
The Balkans
Albania, Bosnia and Herzegovina (BiH), Croatia, the former Yugoslav, Republic of
Macedonia (FYROM), the FederalRepublic ofYugoslavia (FRY).
The PartnerStates ofEastern Europe and CentralAsia
Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgystan, Moldova, Mongolia,
Russia, Tajikistan, Turkmenistan, Ukraine, Uzbekistan
SouthMediterranean, Nearand Middle East
Algeria, Cyprus* Egypt, Israel, Jordan, Lebanon, Malta,* Morocco, Palestinian
Authority, Syria, Tunisia, Turkey*
*Originally Euromed countries, at present EU candidate countries.
African, Caribbean and Pacific (ACP)
CaribbeanAntigua and Barbuda, Bahamas, Barbados, Belize, Cuba** Dominica, Dominican
Republic, Grenada, Guyana, Haiti, Jamaica, Saint Kitts and Nevis, Saint Lucia, Saint
Vincent and the Grenadines, Surinam, Trinidad and Tobago.
**Cuba was admitted as a new member of the ACP in December 2000, but is not
signatory of theCotonou Agreement.
Pacific
Cook Islands, Fiji, Kiribati, Marshall Islands, Micronesia, Nauru, Palau, Papua New
Guinea, Samoa, SolomonIslands, Tonga, Tuvalu, Vanuatu.
West Africa
Benin, Burkina Faso, Cape Verde, Ghana, Guinea, Ivory Coast, Liberia, The
Gambia, Guinea Bissau, Mali, Mauritania, Niger, Nigeria, Senegal, Sierra Leone,
Togo.
Central Africa
Cameroon, Central African Republic, Chad, Equatorial Guinea, Gabon, Sao Tome
and Principe.
66Eastern and Southern Africa andIndian Ocean
Angola, Botswana, Burundi, Comoros, Congo (DRC), Djibouti, Eritrea, Ethiopia,
Kenya, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Rwanda,
Seychelles, SouthAfrica, Sudan, Swaziland, Tanzania, Uganda, Zambia, Zimbabwe.
Asia
AseanBrunei, Burma/Myanmar, Cambodia, Indonesia, Laos, Malaysia, Philippines,
Singapore, Thailand, Vietnam.
Saarc
Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, SriLanka.
OtherCountriesand Regions*
Afghanistan, China, East Timor, Hong Kong, NorthKorea, Macao.*
*Yemen, Iran, and Gulf countries are dealt with in the Mediterranean section of this
Report
Latin America
Central AmericaCostaRica, ElSalvador, Guatemala, Honduras, Nicaragua, Panama.
Andean Community
Bolivia, Colombia, Ecuador, Peru, Venezuela.
Mercosur
Argentina, Brazil, Paraguay, Uruguay.
Others
Chile, Mexico.
674.2. South-Eastern Europe: The Balkans
Since its inception in 1999, the Stabilisation and Association process is the cornerstone of
EU´s policy towards the Western Balkans. It offers the countries in the region a steadily
closer association with the EU. The three main instruments underpinning this process -
contractual links, autonomous trade preferences and financial assistance – are designed to
equip the countries with the means to maintain stable democratic institutions, to ensure the
rule of law prevails, to sustain open prosperous economies and to create strong links between
the countries and the EU as wellas encourage regionalco-operation.
The process is already beginning to produce the desired results. The countries are becoming
stable, political and economic reform programmes based on EU law and practice are being
implemented throughout the region. There are many challenges ahead, however. Problems of
weakness in the rule of law and democratic institutions, corruption, poverty, social exclusion
and threats of resurgence of extremist nationalism remain. The European Union’s
commitment to the region is long term and it will continue assist the countries in coping with
these challenges and make headway on the route towards full integration. The CARDS
programme is one of the tools of this process; it’s aim being to help these countries become
viable, functioning states atthe same time as theyalign their legal and economic systems with
thoseoftheEU.
4.2.1. Introduction
The year 2001 saw the three basic building blocks of the Stabilisation and Association
Process inplace and generating results tothe countries or tothe regionas a whole.
Stabilisation and Association Agreements were signed with the former Yugoslav Republic of
Macedonia onApril2001 and Croatia on October 2001: Interim Agreements were also signed
the same year with the two countries in order to allow the trade and trade-related matters of
the SAA to enter into force in 2001. Also in 2001 the Commission recommended the opening
of the negotiations for an EU/Albania Stabilisation and Association Agreement. BiH
continued during 2001 the work on the Consultative Task Force and progress on the 18 basic
steps identified in the Road Map, hoping for a completion of those in 2002. With respect to
the Federal Republic of Yugoslavia, the EU-FRY Consultative Task Force was launched in
July 2001, holding two meetings during the year leading to its final meeting and preparation
ofa Feasibilityreport in2002.
The Trade Preferences, following the EU unilaterally granting, in November 2000, of
almost totally free access to its markets for goods from the Balkans, have already provided a
much needed stimulus to exports. The trade regime serves as a catalyst to the development of
a networkof free-trade agreements between the countries of the Stabilisation and Association
process and beyond. A Memorandum of Understanding was signed in Brussels on the 27th of
June 2001, in the Framework ofthe Stability Pact, byAlbania, BiH, Bulgaria, Croatia, former
Yugoslav Republic of Macedonia, Romania and the Federal Republic of Yugoslavia aiming
to establish a networkof Free Trade Agreements inthe SEE region bythe end of2002.
The EU, which has provided massive financial assistance to the region (over €5 billion since
1991) has sifted the emphasis of the assistance as the needs of the region evolve. A new
regulation was adopted in 2000, which brought a more strategic approach to the provision of
assistance to the countries of the region and reinforces the objectives of the Stabilisation and
Association process. The assistance will focus increasingly on support for the reforms and
institution building necessary to implement the obligations in the Stabilisation and
68Association Agreements. €4.65 billion has been agreed for the region for the 2000-2006
period.
A qualitative leap forward has been made in the programming of CARDS assistance with the
adoption at the end of 2001 of Countries’ and Regional Strategy for 2002-2006. These
programmes, designed in close consultation with the partner countries, the Member States,
relevant international organisations and other donors, focus CARDS for the 2002-2006 period
on key Stabilisation and Association priority areas, ranging from essential reconstruction, to
focused measures designed to build each country’s institutional capacity to understand,
legislateonand finallyimplement coreelementsoftheacquisandentrenchtheruleoflaw.
This improvement in programming is being matched by better implementation. CARDS
assistance is on the whole being delivered rapidly and efficiently. The European Agency for
Reconstruction in particular has, since it establishment in February 2000, established an
impressive track record in delivering assistance quickly and efficiently in its area of
operations - initially Kosovo, but now including Serbia and Montenegro, as well as the former
Yugoslav Republic of Macedonia, where in December 2001 the Commission extended its
mandate for the majority of EC assistance programmes in the country. Elsewhere in the
region decision-making is being devolved to Delegations on the spot and their staffing levels
are being increased inorder to enhance aid delivery.
InAlbania during 2001 implementation of the programmes designed in the previous years
was ongoing. In order to make further progress in the Stabilisation and Association process,
Albania needs to guarantee a stable political environment, with fully functioning democratic
institutions, whichwould allow the countryto re-focus on needed reforms and accelerate their
implementation.
This is why the CARDS allocation 2001 of €37.5 million has been a transitional year to
gradually move the emphasis from the infrastructure investments to institution building
projects. Project implementationofthe Cards 2001 is due to start inautumn2002.
Bosnia and Herzegovina continued to proceed with the process of completion of the "road-
map", a work plan indicating the most crucial reforms, which BiH must address. BiH
benefited from substantial financial assistance in 2001 (CARDS: €105.23 Mio.), with main
focus on refugee return, economic development, justice and home affairs and institutional
capacitybuilding.
In 2001 the FYROM faced the most serious political and security crisis in its history. This
crisis had a major impact on the economy, democratic institutions and the administration’s
abilityto continue the reformprocess.
Active political mediation by the EU Special Representative facilitated the signing of a
Framework Agreement between the parties involved in the conflict on 13 August 2001. The
Framework Agreement requests that the EU co-ordinate the international community’s
assistance in the implementation ofthe provisions ofthe Agreement, in co-operation with the
Stabilisation and Association Council. The full implementation of this Agreement is essential
to build the countrywide politicalconsensus and stabilityneeded for the reformeffort ahead.
The EC’s pro-active involvement is reflected also in the additional assistance provided by
various EC instruments. Immediate humanitarian needs were covered by ECHO, and the
European Initiative for Democracy and Humans Rights supported the monitoring of the
population census. The Rapid Reaction Mechanism ( €12.8 million) and CARDS emergency
69assistance ( €13.7 million) concentrated mostly on rehabilitation and reconstruction, to
facilitate returnofrefugeesand displaced persons.
By the end of 2001, some 430 houses, many of them seriously damaged, had been or were
being rebuilt. Repair and rehabilitation of power networks, supplying electricity to some
150,000 people, was completed or well under way. Security remained a problem both for
NGOs involved in housing reconstruction and the Macedonian Electricity Company, with
works sometimes having to be suspended and resumed later once security situation
permitting.
Rapid progress in the relationship between the EU and Croatiain 2001 is reflected in the
signature of the Stabilisation and Association Agreement (SAA) in October, and also in the
substantial increase in assistance, from €18.3 million in 2000, to €60 million in 2001. While
refugee return was the main focus in 2000, the 2001 programme extended to human capital
development, compliance with SAA obligations (notably in Justice and Home Affairs
matters), strategydevelopment capacitybuilding and support to civilsociety.
M e a n w h i l ea s s i s t a n c et o FRYin 2001 amounted to more than €55077million. Assistance
continued with major repairs and investments in physical infrastructures and utilities, which
accounted for 60% of 2001 funds. Gradually assistance also moved towards support for
longer-term, sustainable development of a market-oriented economy (25% of the funds,
largely directed to enterprise support and rural/agricultural communities) and the
establishmentofdemocracy, HumanRightsandtheruleoflaw(15%ofthefunds).
During 2001, the European Union increased its ties with the region, building on what had
beenachieved in2000.
TheEuropean Agency for Reconstruction78is responsible for the management of the main
EC assistance programmes in FRY and FYROM. The total sum of EC funds newly delegated
to the Agency in 2001 amounted to some €525 million, and it now oversees a portfolio of
over €1.6 billionacross its four operationalcentres. Of the funds under its management at the
end of2001, 85% had beencontracted and 68% paid.
During 2001, in the Republic of Serbia, the Agency helped to stabilise an emergency
situation, ensuring a sufficiency of electricity and fuel oil, basic foodstuffs and essential
medical supplies, while carrying out small-scale infrastructural projects in towns and schools
across all municipalities. In the new 2001 programme it consolidated its work in the energy
sector, while continuing to supply essential drugs and healthcare equipment. It imported
agricultural seed and fertiliser to help revitalise the rural economy. It provided credits to
galvanise the small business sector, and it launched smaller programmes to promote freedom
of the press, and to support civil and environmental regeneration specifically in Southern
Serbia.
In Kosovo, the Agency continued to meet the most basic needs of physical rehabilitation: in
works on the main power plants and coal mines; in rebuilding damaged houses, roads and
bridges; in ensuring reliable water supply and waste disposal. At the same time, it
successfully disbursed loans for small and medium-sized businesses and for small-scale
farmers, and boosted productivity in the rural economy through the provision of basic
agricultural inputs. Its projects also paid particular attention to bequeathing longer-term
77IncludingKosovoand part oftheregionalco-operation budget. Humanitarianassistanceisnotincluded.
78http://www.ear.int
70best practice in Kosovo, by giving technical assistance and building institutional
capacity. Smallerprojects were launched to encourage a free and professionalpress, and
to support small NGO initiatives – particularly for women and for minorities of all
descriptions.
In the Republic of Montenegro, the Agency accelerated key improvements in basic
infrastructure - buildings roads, bridges, and schools. Increasingly, it gave more impetus to
thereformofcentraland localadministration.
The scale of the EU’s total engagement in the region continues to grow . The European
Union is involved at every level. Strategically , by holding out the prospect of potential
membership in the long term, and much closer association with the EU in exchange for
reform in the short term. Militarily , by supplying 38,000 peacekeeping troops from EU
Member States, the bulk of the total. Politically , by taking a very active role in the affairs of
the region, including in responding to crises like in FYROM and Southern Serbia, or in
helping to find solutions to sensitive political questions like the relationship between Serbia
and Montenegro. Institutionally , by working across the board to build strong institutions, so
that the Western Balkan countries can manage their own affairs, uphold the rights of their
citizens, and tackle organised crime. Economically , by assisting with economic reform, by
providing substantial budgetary assistance, and above all, by taking the radical step of
opening the entire EU market to exports from the Balkans, without, at this stage, demanding
reciprocal concessions in return. Financially , by backing the EU policy with enormous
financial help extending over many years. The region is receiving some of the highest per
capita assistance in the world, comparable to the levels that the EC is giving to the candidate
countries.
CARDS COMMITMENTS AND PAYMENTS IN THE REGION 2001
( €million)
COMMITMENTS PAYMENTS
PROGRAMMES 2001 2000 2001 2000
Countries/bilateral
Albania 37.50 32.80 56.00 75.30
Bosnia andHerzegovina 118.70
(1)97.30 143.20 191.50
Croatia 60.00 18.30 14.50 11.50
FRY-Serbia/Montenegro 230.00 215.50 195.80 152.90
FRY-Kosovo 171.50 416.00
(2)402.10 213.20
FYROM-Macedonia 56.20(3) 20.90 28.10 29.40
Regional
Co-operation (4)
Sub total 768.18 800.80 968.70 673.80
Regional 20 16.70 1.70 - (5)
TotalBilateral/Regional 788.18 817.50 970.40 673.80
Other budget lines/BAlines(ATAetc.) 8.00 3.00 1.30 2.50
GRAND TOTAL 796.18 820.50 971.70 676.30
(1) Total2001budget is €105.23 million.
(2) Including €175 million adoptedbyNoteboomprocedureat theendof2000.
(3) Implementation of2001programme started whenpolitical conditionalitywascompiled with endNovember2001.(4) Regional Co-operation elementsareincluded inthefigurespercountry.(5) Regional elementsareincludedin thefigurespercountry.
71Overview ofCommitments/Payments 1995-2001 ( €million)
1995199619971998199920002001Total
OverallCommitments 440 581 584 462 988 1062 5550
Ofwhich
CARDS (Obnova-Phare-Cardsbudget lines)
Commitments 81 320 330 305 455 843 1035 3369
Payments 73 298 254 146 237 624 618 2250
Ratio payments/
commitments91 % 93 % 77 % 48 % 52 % 74 % 60 % 67 %
Democracy&Human Rights
Commitments 3.60 6.80 14.00 6.80 9.72 10.40 11.68 63.00
Payments 3.20 6.25 10.90 6.26 4.08 3.01 0.35 34.05
Ratio payments/
commitments8 9% 9 2% 7 8% 9 2% 4 2% 2 9% 3% 5 4%
4.2.2. Regional co-operation
Tackling regional problems and raising levels of regional co-operation are the focus
of the regional strategy adopted in October 2001. The €197 million package for the
period 2002-2004 aims at providing assistance at the following areas:
•Integrated border management to help inter alia tackle cross-border crime, to
facilitatetrade across borders andto stabilise border regions.
•Institutional capacity building to develop the rule of law and develop
understanding ofEU policies, standards and laws
•Support for democratic stabilisation to help cement advances in democracy and
boost involvementofcivilsocietyintheregion'sdevelopment.
•Support for planning the integration of the region's transport, energy and
environmentalinfrastructure intothe wider Europeannetworks.
These areas have been selected because of their contribution to co-operation between
the countries ofthe region or because theyoffer higher efficiency through deliveryat
theregionallevel.
In addition to the approval of the strategic framework, the EC launched in 2001 the
regional programme for an amount of €14 million addressing key building blocks
for the regional co-operation. It addressed activities in the areas of Justice and Home
Affairs and especially on Justice and Police Co-operation and training ( €4.2
million); in the area of Infrastructure development by making resources available for
an infrastructure project preparation facility for an amount of €3 million and to
strengthen Public Administration reform and regional co-operation ( €6 million), in
particular inthe areas ofaccountancy, statistics (with the support of Eurostat) and the
European Environmental Agency. It also launched support to SENSE News Agency
to cover the activities of the International Criminal Tribunal for the Former
Yugoslavia ( €0.3 million) and the setting up of a Regional University Network ( €
0.5 million), which is a joint EC-UNESCO programme. The programme’s overallresult will be enhanced reliability, capacities and accountancy of public
72administrations especiallyin respect ofthe priorityareas of provision of civil service,
administrative organisation and control, public finance management, financial
control/audit, policy and judiciary capacities, public procurement, and tax
administrationand internationaltrade agreements.
EC contribution under CARDS 2001: €2.85 million (in addition to €950,000 under
OBNOVA2000). This ends in2003.
CARDS RegionalCo-operation Commitments 2001 ( €million)
Regional
Co-operationProject Title Commitment
Justice and Home Affairs 4.2
RegionalInfrastructureDevelopment 3.0
Strengthening Public Administration 6.0
Democratic Stabilisation 0.8
TOTAL 14.0
4.2.3. Transport and Infrastructure, Water and Energy
Ahead of the regional programme 2001, a Regional Balkans Infrastructure Study
Programme ( €6 million) was adopted inJanuary2001.
In the transport sector the most high profile achievement of 2001 was the opening of
the Vora-Sukth highway near Tirana. This completed the link between the capital
andDurres, onthe coast, nearlyallofwhichwas financed bythe EC. At Durres, half
ofthe ferryterminalquaycame into operation, withworksonthe second half starting
later in the year. In May 2001, the 33km Durres-Rroghozine highway opened, a
stretchofroadwhere the East-West and North-Southcorridorsmeet.
During 2001, phase II of the EC’s support to local community development projects
was completed, with the funding of more than €7 million worth of small scale
infrastructure projects in towns and villages throughout Albania. In 2001 these
included nearly 30 rural and urban roads, almost 20 rural water supply and waste
water systems, two bridges a schooland a localcourt. All projects under Phase III of
the Local Community Development Programme have been concentrated in Tirana,
which has doubled its population over the past decade. Further smaller scale
investments are planned in the local community development projects within
CARDS 2001.. The Commission has already been helping the municipality smarten
upthe façades ofthe main streets –withcontributions frombusinesses and residents.
Repairing the damage of conflict includes repairing national infrastructure as well as
infrastructure linking Bosnia to the rest of Europe. The largest civil engineering
reconstruction project, Samac Bridge, worth €12.3 million, was reconstructed with
ECfunds.
73Samac Bridge
2001 saw the completion of Samac bridge, located on the interstate highway E 73 between
Bosnia and Herzegovina and the Republic of Croatia. It is an important link along the Pan-
European Corridor V, identified within the Balkan Stability Pact for future development. The
bridge was blown up during the conflict in 1992, rendering it impassable to traffic. In addition,
the debris in the riverbed diverted the flow towards the south bank causing considerable
erosion. This change in the hydraulic regime was restored during the course of the new works.
In general form the reconstructed bridge follows its predecessor but the width of the roadway
was increased to 6.6 metres between kerbs to facilitate two-way traffic flow. The scope of the
project was extended to include railway works for new track over the bridge and connections to
the existingrail networks on the north andsouth side of the river.
Reform in civil aviation transport continued to receive support, given the needs of
the sector, and the strategic location of Bosnian air space. Technical assistance (1
million) aims to help establish a strong and effective Department of Civil Aviation,
capable of performing its functions effectively and supervising the safety and
securityresponsibilities and obligations uponcompletionofthe project.
Energy infrastructure rehabilitation received €3.8 millionas a complementaryaction
to an EIB and EBRD funded project. The EC provides a technical assistance
contribution to the interconnection of power systems in South Eastern Europe with
those of Central and Western Europe at the central power station in Ernestinovo in
th eC r oa ti anD a n ub eR e gi on .
To date,the European Agency for Reconstruction has repaired 380 kmof main roads
in Kosovo. The assistance also included essential safety measures such as horizontal
and vertical road signs, white lines, barriers in key road axes and two bridges. This
work has significantly upgraded the transport infrastructure across Kosovo, thus
facilitating the movement ofgoods and people. Inaddition, support has been given to
the railway system in Kosovo (supply of equipment and the repair of tracks).
Institutional support has also been given to the Ministry of Transport (formerly,
UNMIK’s Department of Transport). The border crossing at Blace between Kosovo
and FYROM is also being improved.
InMontenegro, emphasis is being placed on improving the levels of service and road
safetyof the coastal road between Petrovac and the Croatian border, and of the main
road between Podgorica and Cetinje. The transport infrastructure programme for the
2001 budget includes:
– con s truc ti onofan8kmthi rdl an eonth er oadf romPodgori catoCeti nj e
– construction of a 1.5 km third lane on the road from Petrovac to the Croatian
border
– rehabilitation of two additional landslips on the road from Podgorica to the
CroatianBorder
upgrading safety facilities on the sections of the same two roads that are not directly
part of the other two projects. The project will concentrate on 124 km of road and
provide anti-skid surface treatment at “black spots”, and crash barriers. It will also
upgrade warning and informationsigns and improve roadjunctions.
74Transport and infrastructure is key for the development of FYROM, given its
geographical position as a transit country. This sector continued to receive support
from the 2001 budget. Of the €13.5 million foreseen for these sectors, €11 million
were committed to finalising the upgrading ofthe E75 road, part ofCorridor X ofthe
Trans European Network of cross continental road routes. A small-scale
infrastructure Fund with €2.5 million was set up, to provide for upgrading of
infrastructure in municipalities.
To alleviate the consequences of the political and military crisis, the EC funded the
repair of the electricity distribution transmission and distribution systems, local
infrastructure, buildings and houses in the former conflict areas. The EC also
provided cash assistance to about 6,500 families hosting refugees or displaced
people.
Similarly, in FRY, infrastructure, energy, housing and environment have been the
areas receiving assistance, intotalmore than €297 million in 2001. Since June 1999,
€273 million of EU funds have been provided to improve the energy supply in
Kosovo. €80 million were allocated in 1999 and 2000 to pay for electricity imports,
emergency repairs to Kosovo’s own power stations, and the salaries of employees. In
2000 and 2001, the European Agency for Reconstruction implemented a major
overhaul of Kosovo B power plant. To date, €121 million have been spent on the
overhaul. Alongside this overhaul, €50 million of EU funds have been directed
towards an extensive rehabilitation of the coal mines that feed both Kosovo B and
Kosovo Apower stations. Repairs onKosovo’s electricitytransmission networks and
the district heating systems have also beenundertaken.
The 2001 Serbian energyprogramme aimed to help stabilise and secure the domestic
powersupplythrough:
– rehabilitationof4 thermo-electric power plants, plus spare parts for other coal/
hydro-electric facilities ( €37million)
– 42 projects to overhaulsub-stations and power lines ( €24 million)
– provision of equipment and further spare parts for two coal mines - Kolubara,
Kostolac ( €17 million)
– technicalassistance and institution-building ( €2 million).
Works started in August 2001 and are now complete, with all equipment and other
supplies delivered.
The programme also supported the further rehabilitation and maintenance in power
generation, distribution and in the coal mines, and further imports of electricity. €15
million was allocated to the Serbian Assistance Fund for Energy, a joint venture with
the US Government, which contributed $15 million through USAID. The fund was a
financing mechanism to assist the imports of electricity into Serbia. EU-funded
imports started in early December and concluded in January 2002. Funds were also
allocated to preliminary studies on the setting up of a Serbian Energy Efficiency
Agency and a Serbian Energy RegulatoryAgency, and a study on the new measures
needed to increase coalproductionat the Kolubara mine.
75Under the “Energy for Democracy” programme, which began in November 2000,
diesel and heating oil (‘mazout’) were provided for 60 municipal heating systems
(covering 80% of the population), for schools, and for hospital heating systems.
Power plants and coal mines were also supplied. Total funding of the programme
was €45 million. The programme continued throughthe worst ofthe winter, and was
completed in April 2001. A substantial proportion (70%) of Serbia’s winter (2000-
2001) electricity needs were imported by the EU, with a total cost of €45 million,
and this helped to stabilise power supplies. Essential spare parts to secure production
in the lignite mines of Kolubara and Kostolac were also contracted, for €7 million.
Deliveries began in February 2001 and ended in March 2002. A further €7 million
was spent onelectricityimports during Julyand August 2001.
By the end of 2002, the Agency's housing programme will have reconstructed over
16,500 houses in Kosovo. This means that over 120,000 people will have been
assisted. Under the 1999 housing programme, 3,540 houses were reconstructed. A
further 8,420houses were then reconstructed at a cost of €60 million under the 2000
housing programme. The 2001 housing programme reconstructed a further 3,630
houses. 80% of all houses rebuilt by the Agency in 2001 were in what is known as
Category IV (those completely destroyed) and most of the rest were in Category III
(seriously damaged). The European Agency for Reconstruction has also provided
technical assistance to the Housing and Property Directorate (HPD), and is
completing the reconstructionof five kullas (traditional stonetower houses).
The European Agency for Reconstruction is engaged in a huge programme of works
to rehabilitate the urban water supply and sanitation systems in Kosovo, and to
upgrade levels of waste management to western European levels. A programme of
support for essential public utilities, including improvements to the quantity and
quality of the water supply ( €3.7 million) is contributing to the rehabilitation of
water installations, emergency repairs and the procurement of equipment such as 35
vehicles and 14,000 spare parts for the municipal water companies. Under the 2000
Programme, €10 million was directed towards improving the water supply and
sanitation networks. This included repairs to pumping stations and water treatment
works. In 2001, a programme was launched to improve solid waste management in
Kosovo. 19 waste disposal sites across Kosovo were upgraded. The works in 2001
also included the construction ofsix regional landfills.
Transport and Infrastructure: Commitments 2001 ( €million)
Transport and
infrastructureCountry Project Title Amount
Kosovo Transport 18
RepofMontenegro Transport 7
Bosniaand
HerzegovinaAssistancetotheCivilAviation
Authority1
Albania NationalTransport 12.5
Albania TransportInfrastructurePogradec-
Kapsthice7
Albania Port of Durres 2.1
Albania Cross Border Crossing Kakavija-
Gjirokaster6.8
TOTAL 54.4
76Environment
Within the environment sector, 2001 saw the establishment of the Tirana office of
the Commission-funded Regional Environmental Centre in Budapest. This means
that Albania is now involved in regional environmental policy-making, and can
benefit from the resources made available for building capacity in environmental
management. With a view to launching major works on water and waste water
systems at Vlore, Gjirokaster, Saranda and Lezhe preparatory work has been
undertaken by the Ministry of Public Works and Tourism, in tandem with
Commission-financedtechnicalassistance.
Environment , which has inprevious years also beenthe target of EC assistance, was
allocated €3.25million forthe preparation ofthe NationalEnvironment Action Plan,
solid waste feasibility studies and equipment for air quality monitoring stations in
FYROM.
4.2.4. Rural Development, Agriculture
InAlbania, in the agricultural sector, the EC is working along three lines: food
control; fisheries; and veterinary control. With a view to delivering much-needed
equipment to the central and regional veterinary institutes and laboratories,
significant preparatorywork has been undertaken in 2001. This equipment will assist
the Government in developing the necessary market and service infrastructures to
meet the needs ofa reformed agriculturalsector.
InBosnia and Herzegovina agriculture has traditionally been a key economic
sector. The EC has helped veterinary services in ensuring better health and
management of livestock, to increase consumer confidence and trade. Technical
assistance has been provided to create two reproduction centres for pigs of high
genetic value. In the selection of the breed, particular attention was brought to the
adaptability of the breed to the local conditions, with high success. There are as a
result of the project two multiplication centres (each with approx. 50 animals), two
artificialinseminationcentres(with5animalseach), andtwo fatteningcentres for the
first generation boars. The project has the potential of producing 1800 tons of pig
meat.
The aimofthe 2001 Serbianagriculture programwas to supportthe sector,through:
– the import of a total of 48,700 tons of fertiliser of Romanian origin (36,700
tons of NPK in August and September 2001, and 12,000 tons of urea in
January2002). Deliveries to end-users are complete.
– arresting the trend of de-stocking of livestock as a result of feed shortages,
through the import of 42,000 tons of maize for reprocessing into animal feed.
Imports from Hungary started in September 2001. Distribution started in
March2002.
– provisionoftechnicalsupport for changes in agriculturalpricing and marketing
policy, and for the relevant regulatory framework for food products. The
consultant teamstartedwork inJanuary2002.
InMontenegro,the Agencycontracted aprocurement teamto purchase and distribute
state-of-the-art dairy production equipment to replace outdated machinery. The
77procurement team will assist the Ministry of Agriculture in policy issues and
assessing business plans ofthe selected enterprises receiving the equipment.
Agriculture in FYROM is, together with transport, a key economic sector for the
country and for its trade relations with third countries. The importance of EU
markets for exports of agricultural products and the obligations stemming from the
Stabilisation and Association Agreement require reforms in veterinary and
phytosanitarycontrols as well as in animal identification systems. Building on results
of ongoing programmes, the 2001 programme provided €3 million worth of
technical assistance related to food quality control, equipment to extend the
veterinary and phytosanitary control capabilities, and training and equipment to
ensure that the animal identification system covers all the livestock of primary
importance.
CARDS RuralDevelopment, Food Security – Commitments 2001 ( €million)
Country Project Title Amount
CARDS Albania LocalCommunityDevelopment 10
CARDS FYROM Institutional Capacity Building –
Agriculture3
CARDS Kosovo Agriculture 10
CARDS Serbia Agriculture 20
TOTAL 43
4.2.5. Institution Building
InAlbania institution building receives the greatest proportion of EC assistance.
This responds to the need for stronger public institutions, necessary for Albania to
develop closer ties with the EU in the framework of the Stabilisation and Association
Process. Of the €37.5 million allocated in 2001, €23 million were devoted to
enhancing Albania’s capacity in terms of security and public order, strengthening
rule of law, good governance and respect for Human Rights, strengthening public
finances, increasing customs and tax revenues, strengthening standards and
certification, andaidco-ordination.
Together with refugee return, institution building is the area receiving most EC
funding. In Bosnia and Herzegovina , in 2001 alone, €31.26 million were directed
to institutional capacity building (State and Entity level institutions) and Justice and
Home Affairs(Independent JudicialCommissionand border management).
Institution building is the main focus of the 2001 assistance programme for Croatia,
receiving €28.4 million, and covering sectors such as labour market restructuring,
alignment to EU standards, reform of the judiciary, asylum policy, integrated border
management, public administration reform, intellectual property, competition policy,
statistics, strategydevelopment capacitybuilding and civilsociety.
Institution building needs vary between the various parts (Serbia, Kosovo,
Montenegro)of FRY, which intotalreceived €59.8 million for this purpose in 2001.
In Serbia, a Policy and Legal Advice Centre featured a special team of 12
international and local experts assembled to provide advice to the Government on
78keyissues: e.g. transitionto a market economy, regulatory framework, harmonisation
of legislation with the EU, accession to the World Trade Organisation. The signature
of the agreement financing the Centre took place in October 2001, and the team
started work inDecember 2001.
In Kosovo, EU local government experts have been seconded to municipalities in
Kosovo to assist in their institution building. In 2000, the Municipal & Local
Investment Fund (MLIF) was established to finance small-scale infrastructure
rehabilitation projects proposed by municipalities across Kosovo. Examples include
road patching and the repair of street lighting and pavements. The Agency also
supportedthe OSCE in its organisationofKosovo’s election inNovember 2001.
Governance will be enhanced in Montenegro through an Agency project to assist the
decision-making capabilities of several of its institutions, such as the Statistical
Office. Management expertise will be provided, as well as training sessions and
study trips abroad. The project also foresees the provision of technical support to
assist in reforming the administration of capital expenditure in the public sector. The
Agency is also providing technical support to the Budget Office, Treasury Unit,
InternalAudit andITUnit withintheMinistry.Inaddition,IT equipment to the value
of €1 million has been provided, and a long-term information and technology expert
willsupport the computerisation ofthe Ministry. Technical expertise is also provided
to support the restructuring ofthe MinistryofFinance.
Centrally managed projects have again included customs and financing of
transitional civilian administrations, owing to the specific nature of these
programmes. The Balkans Customs Team of EuropeAid Co-operation Office has
continued its direct management of the Customs Assistance Mission in Kosovo
(CAM-K) ( €5 million) and has started developing similar assistance to Serbia ( €5
million) and to Montenegro ( €1.4 million).The Customs Assistance Mission to
Albania (CAM -A) ( €2 million) and the Customs and Fiscal Assistance Office
(CAFAO) ( €10.5 million) were also successfully continued.. Furthermore, the
Commission continued supporting the running costs of the interim administrations in
Bosnia and Herzegovina and Kosovo. €13,5 million were provided for the Office of
the HighRepresentative and €11 million were provided for the EU Pillar ofUNMIK
responsible for the reconstructionand economic recoveryofKosovo.
InFYROM , the strengthening of government institutions is high on the reform
agenda, and institution building therefore continues to receive EC support; in 2001, €
11.5 million were earmarked for this purpose. The main focus was in the area ofJustice and Home Affairs (Judicial reform, integrated border management and
customs administration), building on programmes from previous years. In addition,
to assist the country in implementing the Framework Agreement for peace,
€1.7
millionwere provided to support police reform.
79The CustomsandFiscalAssistanceOffice(CAFAO)
Since1996, theCustoms and Fiscal Assistance Office (CAFAO), has been assisting the State and
Entity authorities of Bosnia and Herzegovina to implement the customs and tax related
provisions of the Dayton Peace Agreement. Assistance and advice are given on all aspects of
customs and taxation work: management, organisation, structure, procedures, legal questions,
computer systems, investigation, and training. CAFAO is generally viewed as one of the more
successful reform programmes in Bosnia and Herzegovina, with assistance being provided
against a background of an inconsistent and shifting political will to implement change, the
continued existence of ethnically based parallel structures and widespread corruption. The
number of European customs and taxation officers working in the programme has varied from
20 to40depending on programme needs and activities. One of the most obvious indicators of its
success is the consistent increase in customs revenue, which in 2001 was three times as much as
in 1996.
This table shows examples ofimportant projects inInstitutionalBuilding for 2001.
InstitutionBuilding– CARDS Commitments 2001 ( €million)
Institution Country Project Title Amount
GeneralDirectorate
ofCustomsAlbania Customs Assistance Mission
(CAM-A)2.0
GeneralDirectorate
ofTaxationAlbania Computerisationoftaxation 2.0
FederationCustoms
Administration&
Republika Srpska
Customs
AdministrationBosnia &
HerzegovinaModernisationofcustoms 10.5
UNMIKCustoms
ServiceKosovo Modernisationofcustoms 5.0
JHA Croatia Judiciaryand Law Faculties 0.6
InstitutionBuilding Croatia Support tothe Ministryof
EuropeanIntegration inthe
approximation of legislation0.8
Taxand Customs
AdministrationSerbia Customsand FiscalCo-
ordinationOffice inSerbia
(CAFACO)5.0
Taxand Customs
AdministrationMontenegro Customs and FiscalAssistance
MissioninMontenegro
(CAFAM-M)1.4
TOTAL 27.3
4.2.6. Private Sector and Economic Development
As part of the European policy to assist in the transition to a market-oriented
economy, enterprise development received €36 million in 2001. This economic
regenerationstrategyremains focused onprivate sectordevelopment, localeconomic
development and job creation, and the creation of a single economic space in line
with the European Union. European projects worked to address these problem areas
with30 projects witha totalbudget ofalmost €90 million.
80In 2001 EC projects in the Balkans have worked to strengthen the development of
the domestic banking sector through building up the management capacity of
domestic banks and the establishment of a self-sustaining Micro Enterprise Bank.
Domestic trade also benefited from technical assistance to remove internal trade
barriers with progress now being made in tax harmonisation and creation of effective
customs unions.
The Cards allocation for Albaniaincludes projects within the field of standards and
certification as well as the local community development aiming at enhancing the
localeconomyby improving infrastructureand localemployment.
The Serbian enterprise programme supports the development of small and medium-
sized enterprises (SMEs), through:
– the provision of a credit line (total so far donated by the EU through the
Agency is €10 million) in the form of a revolving credit fund based in the
National Bank of Yugoslavia and lent onwards to SMEs through three
commercial banks, Exim Bank, Novosadska Bank and Zepter Bank (other
banks will join the scheme soon). These banks have received over 600
applications so far. Loans have beenapproved in40 cases, for a total value of €
4 million.
– assistance to the Ministry of Privatisation, Restructuring and SME
Development.
– the establishment of, and assistance to, support facilities for SMEs, in the form
ofbusinessadvicecentres (“RegionalEnterprise Agencies”) insevencities and
towns, with sub-centres in a further 11 towns. The first agencies will open in
May2002.
– the establishment and operation of a Euro Info Correspondence Centre in
Belgrade, whichwillopen in April2002.
In addition, €1 million funding has been provided for technical assistance for the
first stages of restructuring state enterprises. Work on this started in March 2002, in
three enterprises in the field oftransport vehicles and agricultural machinery.
The European Agency for Reconstruction is playing a key role in enterprise
development in Kosovo. In 2000, the Agency, along with the World Bank,
established the Interim Credit Unit (ICU), which provides credit to small and
medium-sized enterprises (SMEs). It is the number one lender in Kosovo. As well as
supporting the ICU, the Agency, along with the German Development Bank KfW, is
providing small loans to micro-enterprises through the European Fund for Kosovo.
Three Regional Enterprise Agencies were established at the end of 2001, and EU
funds have also supportedthe creation ofthe Kosovo Council for SME Development
which acts as an independent advocate for the private enterprise sector. The Agency
also helped establish the Euro Info Correspondence Centre (EICC) in Kosovo, which
now acts as Kosovo’s business link with the rest of Europe. Much support has also
been given to socially-owned enterprises (SOEs) throughthe IndustrialDevelopment
Programme (IDP).The IDP provides technical assistance and credit to SOEs in order
to re-start productionand create jobs.
81As part of an overall effort to revitalise the enterprise base in Bosnia and
Herzegovina, the EC is funding the revitalisation of approximately 45 medium sized
companies in the agribusiness, textile and leather sectors, as well as regional
enterprise development. In addition to the €4.2 million for this revitalisation and
restructuring, €10 million were provided in 2001 for revolving funds for private
sector development.
Financial Instruments tosupport SMEs
The European Fund for Bosnia and Herzegovina has provided approximately €8.7 million in
loans for SMEs, of which €5 million have been provided by the EC. Other bilateral donors
participating in the European Fund for Bosnia and Herzegovina are Austria, Germany and
Switzerland. This credit line is managed by an EU bank through a number of participating
Bosnian banks. The programme is targeted at SMEs and start ups and covers investments in
plant and equipment as well as working capital. It is the only programme so far in Bosnia and
Herzegovina, which supplies long-term credit. There are presently 8 partner banks (6 in the
Federation and 2 in Republika Srpska) which have approved over 123 loans, indicating the
dynamic development of this loan programme. The EC is also channelling €9.5 million for
micro-credits through the Micro-Enterprise Bank (main shareholders are the EBRD and IFC),
which to date has provided more than €19 million in more than 3,400 loans. 30 operational
Projects werecommitted in2001for atotalamount of €90 million.
CARDS Private Sectorand Economic Development Commitments 2001
( €million)
Country Project Title Amount
CARDS Albania Standards and Certification 2.0
CARDS Regional Regionalproject onstatistics 2.5
CARDS Croatia IndustrialStandards 3.0
TOTAL: 7.5
4.2.7. Health and Education
4.2.7.1. Health
While health is not adesignated priorityfor EC assistance inthe Western Balkans (as
opposed to bilateral assistance). At the same time, the CARDS programme in 2001
included €31.5 million for the health sector in Serbia. €26,5 million were used to
improve the availability of essential drugs throughout Serbia and introduce reforms
such as establishing treatment protocols and the rationalisation and restructuring of
the pharmaceutical industry. A €5 million contribution to health reforms in Serbia
was designed to improve the quality of some basic services in hospitals and health
centres by rehabilitating and supplying priority equipment. Health care reform in
Kosovo received €14 million for a local technical assistance team to assist the
UNMIK Department ofHealth and Social Welfare, for EC support to a World Bank
project to implement a social insurance system, and for providing essential medical
and informationtechnologyequipment.
4.2.7.2. Education
Reform of higher education in Albania has received €2.5 million, enabling the
countryto continue participating inthe TEMPUS programme. The main objective of
the programme is the promotion ofreformof higher education institutions as well as
82academic teaching and learning, using “Joint European Projects”. The aimof these is
to contribute to the long-term development and renewal of the partner country’s
higher education through co-operation activities between higher education
institutionsoftheEuropeanUnionandthepartnercountry.
Education reform in Bosnia and Herzegovina focuses on vocational education and
training and higher education. The first vocationaleducation and training programme
resulted in a Green Paper agreed to by the 40 key actors responsible for education in
Bosnia and Herzegovina. In the course of 2001, this paper was followed by a White
Paper, which represents an agreed concept for legislation throughout Bosnia and
Herzegovina and a framework for implementation of the operational steps for
reforming the system state-wide, including the application of a single frame
curriculum for vocational education. Higher education reform is linked to the
participation of Bosnia and Herzegovina in the TEMPUS programme; the EC
provided €3 million forthis purpose in2001.
Vocational education and training reform and higher education reform will assist
Croatiain tackling unemployment, one of its greatest social problems. The EC is
contributing to vocational education and training reforms aimed at the establishment
of a modern, flexible and high quality vocational education and training system,
responsive to the needs of the labour market and society and well integrated with the
primary, general secondary and higher education systems, with an emphasis in
decentralised management and the preparation of concepts for holistic curriculum
and teacher training reform. Promotion of the reform of higher education institutions
and academic teaching and learning is done through Croatia’s participation in the
TEMPUS programme( €4 million).
FRY including Kosovo (under UN administration) has received €4.9 million to
ensure its participation inthe TEMPUS programme. Inaddition, reformof vocational
educationand training inMontenegro has received €1 million in2001.
The close link between education and unemployment (currently more than 32% of
the workforce) in FYROM has resulted in this area being a target for EC funding. In
2001, the EC supported higher education reform with €7 million, of which €3
million, were earmarked for participation in the TEMPUS programme and €4
million (in addition to €1 million for this purpose in 2000) for the creation of the
first university providing education in the Albanian language as well as in
Macedonian and English. The creation of this university aimed to respond to one of
the main grievances of the large Albanian minority in the country, and improve
interethnicrelations.
South East Europe University in FYROM. On 20 November 2001 the South East
Europe University opened its doors for the first time. The curriculum will be in
Albanian, Macedonian, English and other European languages. The university will
include faculties of law, business administration, public administration, teacher
training, communications and computer studies. The total cost of the project, co-
ordinated by the OSCE, was approximately €33 million, for which the European
Union, including the European Commission (with €4 million) and bilateral
contributions from the EU Member States, is the largest donor. Project activities
have been directed towards the construction of the University buildings, and also
providing student loans and covering the running costsofthe institution.
83Socialdevelopment – CARDS Commitments 2001 ( €million)
Social Development Country Project Title Amount
OBNOVA 2000 Croatia Tempus 1.5
CARDS 2001 Croatia Tempus 4.0
CARDS 2001 Croatia Labour MarketRestructuring 3.0
CARDS 2001 Croatia VocationalEducation andTraining 0.6
Education FYROM South EastEuropeUniversity 4.0
4.2.8. Cross cutting Issues
4.2.8.1. EuropeanInitiative for Democracyand HumanRights
In 2001, EIDHR committed more than €10 million for projects in the Western
Balkans.
EIDHR provided nearly €4.5 million for projects supporting promotion and defence
of Human Rights and fundamental freedoms in the countries of South-Eastern
Europe. Amongst the initiatives supported, the Roma communities benefit from
specific support. A specific project contributes to the inter-ethnic dialogue through
the strengthening of the management capacity of local authorities when dealing with
theRoma communities inBosnia and Herzegovina, Croatia, Kosovo, Montenegro, in
FYROM and in Serbia ( €725,000). In FYROM one of the projects will allow
observation and monitoring of the census in order to promote an equitable and
impartial presentation of the population, and to follow international
recommendations withregardto the census ( €999,800).
AMastersProgramme inRegionalEuropean’sDemocracy
and Human Rights inEurope and theSouth East.
The project will give post-graduate students from Albania, Bosnia and Herzegovina, Bulgaria,
Croatia, and FYROM the opportunity to study Human Rights. This master’s course will
contribute to the emergence of specialist individuals who will join NGOs, local administrations
and become political decision-makersin the Balkans. €1.3has beengranted forthisaction.
The support to the processes of democratisation and to the reinforcement of HumanRights has benefited frommorethan
€3 million spent on five projects. For example,
a €820,000 project developed and reinforced the possibilities of action of civil
institutions and NGOs and increased the number and the capacity of active NGOs.
Another project was set up to restore and build up confidence between community
groups and the police forces through parents' and teachers' groups and local police
initiatives. This will encourage the strengthening of a democratic environment that
respectsHumanRights inBiH( €300,000).
The support forthe prevention of conflicts as well as to the restoration of civil peace
is a major priority of the EIDHR. This included for example in 2001 a project
entitled "Actions for womenactivists beyond the borders." This aims to dealwith the
divisions in society and to confront community pressure on an individual and
collective basis in time in an individual and collective basis and to confront today’s
realities in different regions of Albania, Bosnia and Herzegovina, Croatia, Kosovo,
84Macedonia, Serbia and Montenegro and of Slovenia ( €660,000). Another project
aims to promote the reconciliation between Albanians and minority groups in the
municipalityofGjakova and Kosovo ( €510,000).
4.2.8.2. NGO Activities
Civil society has a critical role to play in the democratic stabilisation in the Balkans.
An active civil society is crucial in making government and the civil service both
transparent and accountable to the citizen. Continued improvements are needed on
access to informationand also onlegislationthat facilitates NGO activities.
TheCARDSNationalandRegionalProgrammes and the EIDHR have beenthe main
channels for support in this field. In order to enhance ownership at local level and to
improve the EC's responsiveness to needs articulated at the level closest to the
citizen, the EC has endeavoured to work closely with NGOs and other civil society
partners.
In Albania, for example, support for NGOs and civil society was provided mainly
through small-scale operations. Here, the EC allocated €0.2 million to democratic
stabilisation as a whole. In Croatia, €1 million was devoted to strengthening the
capacities of civil societyorganisations and improving their delivery mechanisms. In
BiH, EC support focussed on NGO training and capacity building, NGO project
funding and technical assistance, with local NGOs being particularly involved in
projects relating to refugee return. In total, the EC allocated €2 million to the
development of civil society. In FRY EC assistance mainly took the form of
emergency assistance packages focussing on the promotion of pluralism by
strengthening NGOs and civil society as well as on inter-ethnic reconciliation. In
FYROM, the main aim of support for civil society was to foster national
reconciliation, in the 2001, emergency assistance to FYROM tota lling €10.3 million
was approved by decision of the Commission as a rapid reaction mechanism (RRM)
withthe aim, among others, ofstrengthening civilsociety.
In addition to this, micro-projects managed by the Commission Delegations were
used to respond quickly and effectively to funding requests from local NGOs, co-
operatives, educational institutions, women’s and cultural groups etc. These funds
benefited projects that,owing totheir size, would not normallyattract major donors.
4.2.8.3. Coherence withother policies
EC assistance to the Balkans has been designed to help them participate in the
Stabilisation and Association process and thereby contribute to the goal of conflict
prevention, leading eventually to the conclusion of Stabilisation and Association
Agreements. Under the EU strategy, there is a steady move in emphasis away from
large-scale infrastructure and post war reconstruction to building up modern
democratic States capable of managing their own affairs and being reliable partners
for the EU. The advancement of the economic reform process and the development
of regional co-operation are coherent with the Community’s trade policy for the
region under which highly favourable trade preferences have been granted. In late
2000, the EU established a uniform Autonomous Trade Preference scheme, which
provides dutyand quota free access for practically all exports of the five countries to
theEUmarkets.
854.2.8.4. Refugees Returns
Return of refugees and displaced people to their pre-war homes remains a key
priority for EC aid to the Balkans. The slow return and re-integration of displaced
persons and refugees remains one ofthe main obstacles to the restoration ofpolitical
stability and the return to economic and social normality in Bosnia and Herzegovina.
The EC programme is in line with the objectives defined in Annex 7 of the General
Framework Agreement for Peace (DaytonAgreement),the priorities identified by the
Return and Reconstruction Task Force, the analysis of UNHCR and the “Agenda for
RegionalAction”oftheStabilityPact.
In 2001, of more than €105 million received for Bosnia and Herzegovina, €38.4
millionwere directlydirectedto refugee returnto assist the following:
•specifically to support and sustain breakthrough (minority) and spontaneous
returns;
•toassistthePropertyLegislationImplementationPlan;
•toensurethesustainabilityofthe returns throughthe development ofbusiness and
employment opportunities inreturnareas.
Spontaneous minorityreturns topre-war homes inBosnia andHerzegovina.
The aim of this project was to support the minority community who had already returned to
Kljuc and Bosanska Krupa and to encourage further returns. This was achieved through the
complete reconstruction of 65 houses, repair of the electrical distribution system in Veliki/Mali
Radic – Bosanska Krupa municipality and a job creation component encompassing distribution
of tools, seeds andlivestock. The job creation component of the project provided livestock for 32
families; 33 families received agricultural equipment and chainsaws; 3 micro- business were
established, where 9 returnees are employed full-time, 10 part-time and a few on a seasonal
basis.
In Croatia, refugee return continued to receive substantial funding ( €23.2 million).
Support is delivered via the “EU Reconstruction programme for return” (EUPOP), in
co-operation with NGOs on the ground. The programme promotes an integrated
approach to the return of refugees and displaced persons, and aims to provide
effective return to pre-war homes, sustainability of the return process and
reintegrationandreconciliationthroughthe improvement ofthe qualityoflife for the
entire municipalityofreturninCroatia.
Rebuilding housesdamagedbyconflict.
The 2001 housing sector programme in Kosovo involves the reconstruction of some 3,630
conflict damaged houses for vulnerable families. Around 3,100 houses were completed and
16,700 people had moved into their homes by the end of 2001. About 6% of the families are
from an ethnic minority background, including families that have recently returned to Kosovo.
NGO partners in the programme identified vulnerable families according to rigorous selection
criteria. Elected Village Reconstruction Committees assisted the NGOS and helped ensure
transparency and local accountab ility in the selection process. The NGOS are working to
support the “self-help” inputs of beneficiary families to ensure the successful completion of this
programme.
864.2.9. Co-operation with other donors in the region
Effective donor co-ordination is essential for the success of the reconstruction in the
Balkans. The European Commission/World Bank Joint Office for South East
Europe79ensures that overlaps between donors' activities are avoided in programmes
and projects. Among the key mechanisms of donor co-ordination there are the High
Level Steering Group and a Working Level Steering Group which met regularly to
discuss key issues. Other instruments for donor co-ordination include Donors
Conferences and Consultative Group meetings. In 2001, the Joint Office organised 5
majorDonormeetings.
Co-operation with other donors in the region can be in the form of joint funding of
projects, or entrusting another organisation to manage EC funds. Examples of the
latter are the management of the Small Medium Enterprise credit line of the
European Fund for Bosnia and Herzegovina by the German KfW or the OSCE taking
the lead in the creation of the South East Europe University in FYROM, where
financial resources from the EC and Member States were pulled together. An
example of joint funding and pulling together of resources is the EC technical
assistance contribution to the interconnection of power systems in the Croatian
D a n ub eRe gi on ,t oth ew or k st ob ef un d e db yE I Ba n dE B R Dl oan s .
The EC also provides interest rate subsidies for EIBloans; thus, in the past,
FYROM, received €20 million for this purpose. In 2001, Bosnia and Herzegovina
received exceptionally support of €11.89 million for interest rate subsidies for roads
and railways improvement.
4.2.10. EIB Loans
The EIB operations in the Western Balkans mainly focus on basic infrastructure in
environment, transport and energy, as well as in the support of SME development.
TheEuropeanInvestment Bank worksincloseco-operationwiththeEC.
Examples ofEIB Loans and subsidies 2001( €million)
EIB Loans Country Title of Project Amount of
Loan
BEI Croatia Rehabilitation andmodernisation ofCroatianrailway
section of Pan-European Corridor Vc40
BEI Albania Upgrading ofpower transmission and distribution
networks30
BEI FRY Rehabilitation oftransportinfrastructurein Serbia
and Montenegro66
BEI FYROM Financingfor smallandmedium-scaleventures 20
BEI Bosnia-
HerzegovinaRehabilitation ofseveralrailwaysectionsofPan-
EuropeanTransportCorridors40
TOTALof all loans and subsidies in the Balkans 319
4.2.11. ECHO
The recovery of the Western Balkans from the 1999 Kosovo crisis continued in
2001, although the conflict in the former Yugoslav Republic of Macedonia
79http://www.seerecon.org
87(FYROM) overshadowed the improvement in the overall humanitarian situation. In
2001, ECHO continued to be present in five countries and entities in the region
(Serbia, Montenegro, Kosovo, FYROM and Albania) with a budget of €83.05
million. The decrease from the two previous years reflects the improvement in the
humanitarian situation and the increasing involvement ofother EC instruments.
ECHO’s efforts in the Western Balkans pursued three objectives: to respond to the
new humanitarian needs resulting from the FYROM crisis; to continue addressing
basic humanitarian needs of refugees, IDPs and vulnerable social cases; and, to
promote the LRRD process by supporting the transition to reconstruction and longer
termdevelopment andbypromotingself-relianceamongthebeneficiariesofaid.
InKosovo, ECHO concluded the bulk of one of its largest humanitarian operations,
moving from a pure emergency intervention to rehabilitation and finally resulting in
a successful transition towards a more structural development process. In June 1999,
when the Kosovo refugees started returning, ECHO responded to the pressing
humanitarianneeds, providing food, medical assistance, as well as emergency shelter
to more than 22,000 returnee families. In 2000, ECHO continued to respond to the
basic needs of the most vulnerable whilst supporting the initial steps of the recovery
process (in the education and health sector, through the rehabilitation of water
supplies and by supporting self-reliance projects). In 2001, ECHO succeeded in
finalising its prior intervention and continued to support UNHCR’s protection and
assistance efforts in favour of minorities. In addition, ECHO provided basic
assistance to the refugees fromFYROM (72,000 at the peak of the crisis) and to their
host families.
Serbiaremained ECHO’s largest operation. The political changes in Serbia and the
reform-minded government have attracted long-term structural assistance from
donors, including the EC, as demonstrated bythe success of the donor conference on
FRY, held in Brussels in June 2001. However, humanitarian needs are still
considerable in Serbia, mainly due to the large caseload of refugees and internally
displaced person (IDPs) (almost 600,000). Whilst prospects for the return of IDPs
are, at the moment, still bleak, durable solutions for refugees – mainly integration but
also repatriation - are in sight. ECHO’s programme in 2001 continued to address
basic needs whilst pursuing more long-term solutions, such as facilitating the
repatriation (legal information, go and see visits) and supporting the private
accommodation of refugees, as a more dignified alternative to life in collective
centres.
InMontenegro and inAlbania, the humanitarian needs resulting from the Kosovo
crisis have virtually been fully covered. In Montenegro, ECHO focused on covering
the winter needs and reducing the dependency of beneficiary groups on humanitarian
assistance by funding self-reliance activities. In Albania, one ofthe poorest countries
in Europe, the focus was on consolidating the previous health and water and
sanitation interventions with a view to facilitating the transition to a development
process.
InFYROM , 2001 witnessed an open conflict between the Ethnic Albanian Armed
Groups (EAAG) and the Macedonian armed forces. The conflict escalated in various
stages in the first half of the year resulting in various waves of population
displacements within the countryand outside its borders, especially into Kosovo. The
international community, mainly the EU, adopted a pro-active stance in terms of
88political mediation, of reconstruction assistance (through the Rapid Reaction
Mechanism (RRM) and the CARDS 2001 programme) as well as humanitarian
assistance. Instrict accordance with its mandate, ECHO has provided food assistance
to all IDPs and to vulnerable returnees, non-food assistance to the host families and
IDPs, and has funded the emergency rehabilitation of schools and health centres
damaged during the conflict, in order to facilitate the return of IDPs. Since the start
ofthe conflict, close co-ordinationwithin the Commissionallowed the establishment
of a task division between the various EC instruments, thus avoiding both overlaps
and gaps. ECHO focused on the immediate humanitarian needs whilst the RRM
addressed medium term needs such as housing reconstruction. On the political front,
in spite of some positive developments following the conclusion of a Framework
Agreement between political leaders from both ethnic groups and the approval, in
November, of constitutional changes, the political process was, at the end of 2001,
still fragile.
ECHO Financing Decisions 2001 ( €million)
Country Amount
Serbia 47.800
Montenegro 7.500
Kosovo 14.000
FYROM 5.400
Albania 6.600
Regional 1.750
TOTAL 83.050
4.2.12. Monitoring in theBalkancountries
The Commission, during 2000, conceived an improved results-oriented monitoring
system for the ALA/MED/ACP and Balkan regions, which is rooted in the
Commission’s Project Cycle Management method and tested the system during
2001. The conception and test-phase at its end, the paragraph below describes first,
tentative but interesting insights on what works and what can be improved
concerning the Balkans. Further information on the results-oriented monitoring
systemcanbe found inchapter 1.4(monitoring). The systemis to be applied globally
as of2002.
During 2001, 12 projects were visited in the Balkans in two countries. The total
volume of EC financing covered by these visits amounted to €112.3 million. The
most important sectors assessed were firstly infrastructure and economic services
(76%) and secondly economic and institution building, civil society, social
infrastructure and services (22%). The overall rating for projects in the region was
2.28, compared to anaverage mark of2.5.
Effectiveness, impact and sustainability were identified as being the most successful
aspects. The sub-criterion of socio-cultural adequacy, which includes the
participation of target groups in design and implementation, and the relationship
between project staff and local communities, was given the highest rating in the
region. Among the main criteria, relevance and efficiency were the weakest. Results
89achievement, as related to efficiency, was the sub-criterion with the lowest rating,
followed byeconomic adequacy(as a sub-criterionofsustainability).
4.2.13. Conclusions and Perspectives
The adoption of the CARDS programme in 2000 brought a more strategic approach
to the provision of assistance to the countries in the Western Balkans and reinforces
the objectives of the Stabilisation and Association process. During year 2001 the
programme responded bothto longer-termdevelopment objectives and to immediate
needs caused byconflict or post-conflict situations.
Assistance under the CARDS programme was, on the whole, being delivered rapidly
and efficiently. The European Agency for Reconstruction in particular has
established an impressive track record in delivering assistance quickly and efficiently
in its area of operation - Kosovo, Serbia and Montenegro and since December 2001
also the former Yugoslav Republic of Macedonia. Elsewhere in the region, decision-
making is being devolved to the Commission Delegations.
As the region evolves, assistance has to change. Country Strategies and a Regional
Strategyhave beenadopted in2001 for the period 2002-2006. During this period, the
programmes will focus on the key Stabilisation and Association priority areas,
gradually moving from reconstruction to institution building and economic reform,
one important part being to build each country's institutional capacity to understand,
legislate on and finally implement core elements ofthe Community acquis
904.3. Eastern Europe and CentralAsia
Three main challenges faced the region of Eastern Europe, Caucasus and Central Asia in
2001. The dominant issue is clearly the events of 11 September, which will have a major
impact onthe EC approach in particular to CentralAsia. A doubling of finance for this region
is anticipated in 2002. Second, the EU welcomed the progress in reforms in Russia. This has
been marked by an increased focus in EC support for implementation of the reform agenda,
building onearlier TACIS work, whichhelped put reformlegislation inplace. Thirdly, the EC
has given strong support to those countries currently developing Poverty Reduction Strategy
Papers.
As regards sectoral priorities, three themes are of particular note in the EC response in 2001.
Firstly, increased attention was given to justice and home affairs, and this will be further
expanded inthe years to come. Secondly, the EC consolidated its support for the social sector,
notably health and education. Thirdly, cross-border issues, notably border management
improvement, havebeengivenparticularpriority.
4.3.1. Introduction
The European Union with its Member States, is the largest donor of development
assistance to Eastern Europe, the Caucasus and Central Asia80.T h eT A C I S
programme continued to be the primary source of EU assistance to this region in
2001.
The main purpose of TACIS is to assist in the transition to a free market economy
and to promote greater democracy. This objective is the centrepiece of the
Partnership and Co-operation Agreements (PCAs), which in turn form the basis of
the EU’s continuing relationship with Eastern Europe, the Caucausus and Central
Asia. PCAs are legal frameworks, based on the respect for democratic principles and
Human Rights, setting out the political, economic and trade relationship between the
EU and its partner countries. Each PCA is a ten-year bilateral treaty signed and
ratified by the EU and the individual state. In addition, the European Union co-
operates with Russia and the Ukraine through Common Strategies under the EU’s
Common Foreign and Security Policy. The Common Strategies aim to strengthen
coherence between the EU and Member States’ policies and activities within these
twocountries.
Russia also participates in the ‘Northern Dimension’ initiative concerning the
external and cross-border policies of the European Union covering the Baltic Sea
region, Arctic Sea region and North West Russia. In 2001, the first meetings were
held under the EU/Russia EnergyDialogue, including four thematic working groups,
as well as a Summit meeting. The Commission also produced a Communication on
Kaliningrad in January 200181, the conclusions of which were endorsed by the
Council.
80TACIS: Technical Assistance for the Commonwealth of Independent States covering Armenia,
Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgystan, Moldova, Mongolia, Russia, Tajikistan,Turkmenistan,UkraineandUzbekistan
81COM (2001) 26 of17.1.2001
91The legal basis for TACIS is Council Regulation N° 99/2000 for 2000-2006, which
came into force in January 2000. The regulation takes account of the European
Union’s experience with the region over the past eleven years. The programming
process has evolved and the relationship between the EC and partner countries is
now based more on a constructive dialogue and less on response to demands from
partner governments. The new Action Programmes, in particular those for Moldova
and Kyrgysztan, have established a strong emphasis on poverty reduction. In
addition, the management of TACIS has seen a shift towards a focus on fewer, larger
projects.
The TACIS programme is divided into two main categories: national and multi-
country programmes. During 2001, Strategy Papers, analysing the situation and
setting out the EU response, have been developed for each of the major programmes
covering the period 2002-2006, except for Belarus and the Central Asian countries.
Indicative programmes, describing the priorities for strategy implementation, were
also developed covering the period 2002-2003. For the national programmes, the
indicative programmes for each country establish two or three of the following areas
ofco-operationaspriorities:
•institutional, legal and administrative reform;
•private sector and economic development;
•socialconsequencesoftransition;
•development ofinfrastructure networks;
•environmentalprotection and management ofnaturalresources; and
•development ofthe ruraleconomy.
The principal multi-country programmes are the following: Regional Co-operation,
Cross Border Co-operation, Baltic Co-operation, Nuclear Safety, and the EU-
EuropeanBank for Reconstructionand Development investment preparation facility.
92COMMITMENTS AND PAYMENTS IN THE REGION 2001 ( €million)
COMMITMENTS PAYMENTS
2001 2000 2001 2000
PROGRAMMES
National ActionProgrammes(B7-5200B)
Armenia 7.8 4.3 3.4
Azerbaijan 21.6 4.6 13.2
Belarus 3.1 1.4
Georgia 4.0 8.5 3.7 6.6
Kazakhstan 14.0 6.1 4.6
Kyrgystan 9.1 4.4 2.4
Moldova 19.5 4.0 6.7
Mongolia 4.3 2.4 4.8
Russia 80.0 53.0 86.4 91.3
Tajiskistan
Turkmenistan 2.9 3.1
Ukraine 63.0 63.5 31.2 59.2
Uzbekistan 10.0 6.8 11.9
Subtotal 189.6 168.7 159.9 208.6
Multi-country ActionProgrammes
CrossBorder(B7-5210) 23.0 22.5 26.1 19.4
Baltic(B7-5211in2001,B7-5370in2000) 6.0 5.9
NuclearSafety(B7-524 for2001only) 51.0 35.8
Regional +other multi-country(B7-5200B)* 101.7 214.3 126.2 182.0
Chernobyl Shelter (B7-536) 40.0 40.0 40.4
ATA(B7-5200A) 12.2 32.4 5.6 2.0
Subtotal 233.9 275.1 233.6 243.9
Other budget lines
FoodAid(audit) 1.4
Subtotal 1.4
GRAND TOTAL 423.5 443.8 395.0 452.4
*for2000includesNuclearSafety
OverviewofCommitments/Payments2000-2001(M illion €)
2000 2001 Total
Commitment 443.8 423.5 867.3
Payment 452.4 395.0 847.4
Ratio P/C 102,0% 93,3% 97,7%
4.3.2. Regional Co-operation
Over half of TACIS support is directed through multi-country initiatives. Attention
here focuses on three principal instruments: the regional co-operation programme
(support for co-operation between Newly Independent States), the cross-border co-
operation programme (support for Newly Independent States with joint borders with
theEU/candidatecountries)andthenuclearsafetyprogramme.
4.3.2.1. RegionalCo-operationProgramme
The Regional Co-operation programme promotes co-operation between Newly
Independent States. There are three priority areas: networks, environment and justice
and home affairs. The Regional Indicative Programmes 2002-2003 were prepared
and approved in 2001 for the Regional Co-operation Programme. These documents
proposed new activities in several areas, such as assistance with policy development
in accordance with various international environmental initiatives (for example, the
Kyoto Protocol) and also development ofa telecommunications’ reformprogramme.
Aside fromthese proposed interventions, the RegionalCo-operationProgramme also
93continued work on more established programmes of assistance, such as TRACECA
(oiland gas) and INOGATE (transport).
a) Networks
Support to networks is directed through two main instruments: the INOGATE
programme covering the oil and gas sector and TRACECA programme covering
transport. Inadditionto these two main instruments, support mayalso be provided in
thetelecommunications’ sector.
•Traceca
The Traceca programme supports the development of the East-West transport
corridor from Europe, to Central Asia, via the Caucasus, in order to enhance the
ability of countries in this area to access European and world markets, as well as
fostering regional co-operation. Legislators in the signatory countries agreed the
Traceca Multilateral Agreement - the key basis of Traceca - based within both the
TACIS and PHARE82programmes. This was followed by a detailed action plan for
2000-2001. In February 2001, the Traceca Secretariat was established in Baku, in
Azerbaidjan. The programme has six on-going projects, which form part of the
TACIS Regional Action Programme 1999, and which provided road sector studies in
the Caucasus and traffic forecasting between the 12 Traceca countries. A major
supply contract for an optical cable along the railway lines in Armenia, Georgia and
Azerbaijan is also under implementation.
•Inogate
Inogate aims to enhance co-operation between producers, transporters / pipeline
providers and consumers of oil and gas across the TACIS region. In this way, it
hopesto promoteinterstateoiland gas projects, reduce investment risks and promote
the introduction of international standards – especially in the environmental and
safety fields - in the energy network infrastructure. Twenty-one countries from
Eastern Europe, the Caucasus and Central Asia as well as Greece and Turkey have
signed the Inogate umbrella agreement, which upgrades the East-West oil and gas
corridors in compliance with EU and international standards. Four new Inogate
projects were launched in 2001 to continue work already underway to improve the
accountabilityofgas transit betweenthe NewlyIndependent States.
b) Environment
TACIS funds a range of regional environmental initiatives e.g. a project to help
environmental ministries to implement their national environmental action plans, to
develop commonpolicies and to support sub-projects in environmental financing and
policy reform. Another project funds trans-boundary river management in four river
basins – covering nine countries, in support of the United Nations / Eastern and
Central Europe trans-boundary water convention. The successful Caspian Sea
environmental project ended in 2001 with local experts visiting the Caspian Sea to
monitor invasive and toxic species. The Joint Environmental Programme, which
brings together investment from different international financing institutions,
82PHARE: Poland and Hungary: Aid for Economic Restructuring (now extended to cover Bulgaria,
Czech Republic, Estonia, Latvia, Lithuania, Romania, Slovakia and Slovenia).
94facilitated the signing of a €60 million loan for water protection in Kazakhstan in
2001. There have also been developments under the international framework of
‘Environment for Europe’. Further support was given to the Project Preparation
secretariat based in the European Bank for Reconstruction and Development
(EBRD), and the Task Force for the Environmental Action Programme, based at the
Organisation for Economic Co-operation and Development (OECD). TACIS funds
also assisted Non-Governmental Organisations (NGOs) to prepare a sustainable
development strategypaper to be presented inBrussels in‘GreenWeek’83.
c) Justice and Home Affairs
The European Union is giving increasing attention to supporting the rule of law and
effective law enforcement in its assistance to the Newly Independent States and
Mongolia through the TACIS programme. Key issues are: combating organised
crime, in particular drug trafficking and trafficking in women as well as reducing
illegal migration throughout the territory of the Newly Independent States. The EU is
also giving special attention to the Kaliningrad area and given its future perspective
as an ‘enclave’ within EU Member States. In addition, TACIS seeks to provide
systematic support for enhanced border management. Four new initiatives were
proposed under the Regional Programme for 2001: border management on the
Belarus/Russian border; combating trafficking in women in the Russian Federation;
combating organised crime in Kaliningrad; and fighting the drugs’ trade in the
WesternNewlyIndependent States and the Caucasus.
4.3.2.2. Cross-Border Co-operation
The Cross-Border Co-operation programme is designed to provide support to the
Newly Independent States, which have borders with the EU or the candidate
countries. There are three principal themes to this support: economic development
(specifically SMEs), environment, and border crossings. This support is designed to
be complementary to that provided through the TACIS national programmes, and
details on the individual sectors are provided later in the report. The main focus of
2001 in this area was the opening to traffic of a number of border crossings begun
under earlier programmes. In addition, the cross border economic development
project at Uzghorod on the Ukrainian, Hungarian and Slovakian borders, was
brought nearer completion. This is the first major cross border economic
development project to be financed under TACIS and has produced valuable lessons
for projects about to commence in Moldova and the Ukraine. The Cross-Border Co-
operation programme has been particularly active on the Finnish-Russian Border. A
seminar was held in St Petersburg in November 2001 with the aim of helping to
boost the participation of the Ukraine, Belarus and Moldova. It is hoped that this will
result incross-border committees being established between neighbouring countries.
83Green Week is an annual campaign organised by the European Commission’s Directorate-General for
Environment, which provides a platform for raising the awareness of EU environmental policies andactivities.
95Kamenny Log (Belarus) –Medininkai(Lithuania) Road BorderPost.
The border crossing at Kamenny Log in Belarus is located on the route between Minsk and
Vilnius. It will facilitate the movement of trade along the important route from Kaliningrad,
through Vilnius and Minsk, and onwards toMoscow, as well as linking the Baltic Sea ports with
Russia Following the independence of both Belarus and Lithuania, there was a need to provide
an external border facility. The need to implement controls was considered all the more
important because Lithuania is not a member of the Commonwealth of Independent States and
not part of the customs union with Russia .It is, therefore, a major interface point between
Eastern Europe, the Caucasus, Central Asia and the expanding European Union. A TACIS
grant of €1.34 million supported the construction of the post while equipment is to be supplied
under a €1.12 million grant that covers three border posts in Belarus. The TACIS funded
construction works commenced in January 2001 and were completed at the end of December
that year.Equipment deliveriestothe sitewillbecompletedinApril2002.
4.3.2.3. Nuclear Safety
The EU has made a major contribution to dealing with the problems associated with
the closure of the Chernobyl nuclear power plant through the new Industrial
Complex for Solid Radioactive waste project and the second contribution of €100
million to the Chernobyl Shelter Fund managed by the European Bank for
ReconstructionandDevelopment.
A particular emphasis has been put on increasing operational safety through ‘on site
assistance’, which is provided on a continuous basis by EU operators at 14 sites in
the NewlyIndependent States. On site assistance aims to improve the level of design
safety, operating and surveillance conditions and the organisation of operational
safety. Independent regulatory authorities are being strengthened through EU
technical and financial assistance and much of the necessary legal framework has
now been put in place. The overall safety culture is being improved through more
formal and regular dialogue between plant operators and regulatory authorities (the
so-called ‘2+2’ approach). Nuclear Power Plants (NPPs) are being modernised with
the provision of equipment (a condenser cleaning system to Balakovo NPP, non
destructive testing equipment to several plants, steam generator level control system
to SouthUkraine NPP, etc.).
There are 91 ongoing projects for general assistance, 17 ongoing Procurement Agent
contracts for equipment, 3 contributions to the European Bank for Reconstruction
and Development for the Chernobyl Shelter. 18 new projects have been identified
under the Annual Programme 2001, which contribute to the aim of improving the
cultureofnuclear safetyin Russia, the Ukraine and other CIS countries.
In order to support the establishment of a reliable safeguards system in Russia, the
European Commission is providing support to the Methodological and Training
Centre in Obninsk in its training of both operators and inspectors as well as
providing technical support to Russian operators. In addition, the Ural Siberian
Training and Methodological Centre in Snezhinsk provides training and services to
operators and inspectors involved inthe finalstage ofthe fuelcycle.
The Commission not only co-operates with the European Bank for Reconstruction
and Development but also with the International Atomic Energy Agency, whose
activities to improve nuclear safety in the Newly Independent States are presently
channelled through its Technical Co-operation Program and the Contact Expert
Grouprelated to NorthWest Russia.
96Important steps have also been taken to accelerate the rate of implementation of
existing commitments in the nuclear safety programme. There has been an increase
in staff working on these issues and the team is now well equipped to tackle the four
principal challenges: on-site assistance; design safety and off-site emergency
preparedness; nuclear waste and safeguards, and regulatory authorities and technical
safetyorganisations.
Ensuring the safetyacceptabilityof plant modifications: the ‘2+2’approach
Licensees have complete and undivided responsibility for the safety of their plants and their
impact on the environment. Regulatory bodies inspect and assess all nuclear installations to
ascertaincompliancewithregulationsandlicenceterms. TheTACISnuclear safety programme,
while contributing directly to the upgrading of nuclear installations in the Newly Independent
States, also promotes direct transfer of Western European best safety practice to both licensees
and regulators. More specifically, it addresses the difficult question of the interface between
these two bodies during the licensing of plant upgrades. For this purpose, the so-called ‘2+2’
approach, provides for a coupled co-operation scheme, on the one hand between EU and Newly
Independent States’ nuclear ut ilitiesandon the other hand between EUand Newly Independent
States’ regulators and their expert organisations. In addition to improving licensing practices in
the Newly Independent States, this integrated approach also helps to ensure that EC funded
plant modifications doimprove safetyand conformtoWest European regulations and practices.
RegionalCo-operation – Commitments 2001 ( €million)
RegionalCo-operation Amount
RegionalCo-operation 38.0
Cross-Border Co-operation 23.0
Baltic Co-operation 6.0
EU/EBRD Investment PreparationFacility 15.4
Nuclear Safety 51.0
ChernobylShelter Fund 40.0
ISTC/STCU 25.0
Miscellaneous 21.8
Total 220.2
4.3.3. Transport and Infrastructure
4.3.3.1. Transport
Support to the transport sector is provided both through the Regional Co-operation
Programme (see above) and through the national action programmes. The objective
of the transport projects is to modernise the transport system and to make it suitable
for a modern market economy. In 2001, sixteen projects were under way in the
sector. These projects deployed more than 400 European experts ,o fw h o m3 0w e r e
full-time residents in the partner countries.
Transport infrastructures inherited from the Soviet era are oversized in comparison
with current and short term needs. There is, therefore, no need for major investment,
although some assistance is necessary in order to maintain the efficient utilisation of
the existing infrastructures. The transport system is still dominated by railways,
whichcarrymore than80% ofland freight, (compared with 20% in the EU). In order
97to improve the system’s flexibility, TACIS has been promoting projects in multi-
modal transport by supporting the growth of road transport, breaking up large
transport businesses and transferring management know-how to the partner
countries. Support has also been given to the establishment of modern legal
frameworksand institutionalarrangements.
Projects completed in 2001 included Road Transport Safety and Russian Marine
Seaports’ Safety, which managed to successfully introduce western standards in their
respective fields. Major projects started in 2001 include the Moldovan Railways
Restructuring, the Kaliningrad Port Development and the Northwest Russian Road
Management projects.
Moldovan Railways
TheMoldovan Railways project seeks to revitalise the country's railways system and to enhance
its competitiveness. The project provides consultancy support and training to the Moldovan
authoritiesas well asto the Moldovan Railways witha particular focus on the development and
implementation of a Restructuring Plan.
Kaliningrad ports
Kaliningrad ports are the only ice-free Russian ports in the north-westof Russia and will gain in
importance due to the imminent accession into the EU of neighbouring Poland and Lithuania.
The Kaliningrad Port Development project, started in February 2001, is designed to facilitate
trade and investment between EU Member States and the Russian Federation by strengthening
efficiency and upgrading physical and technical capacity of the channel and Kaliningrad ports.
Specifically, this project promotes opportunities for joint ventures, private banks, and
international funding agencies tofinance the improvement of physical infrastructure and freight
handling equipment. Furthermore, it provides management training in commercial marketing
for senior staff atthePort Authority and port operatingcompanies .
4.3.3.2. Infrastructure
Construction/maintenance
The principal activities in the infrastructure sector in terms of works contracts are
financed throughthe TACIS Cross-Border Co-operationprogramme (see also section
2.2 of this Chapter). During 2001, the construction of four TACIS-funded border
posts was completed at Salla and Svetogorsk in Russia, Kamenny Log in Belarus and
Leushen in Moldova. The year also saw the start of two separate works contracts for
the approach roads to and bridge over the River Bug on the Ukraine–Poland border,
which will be completed in 2002. Tenders for works contracts were launched for a
railway border station at Ivangorod in Russia, the border post at Bagrationovsk and
for the demarcation of 650 km of the Belarus border with Lithuania. Tenders were
also launched for a totalof30 equipment supply lots (16 in Russia, 4 in Belarus, 6 in
the Ukraine and 4 inMoldova).
EnergySector
In 2001 eight major projects continued in the energy sector in the Ukraine, Central
Asia and the Caucasus. Three of these focussed on the reorganisation of the oil and
gas sector and three were aimed at promoting the concept of energy efficiency in the
Ukraine. Two more supported structural reform of the energy market in the
Caucasus. Elevenprojects were implemented inthe energysector in Russia, of which
five willcontinue into 2002.
98Transport and Infrastructure: Commitments in 2001 ( €million)
Transport and Infrastructure Country Amount
Transport Kyrgyzstan 1.2
Environment Kazakhstan 2.0
Energy theUkraine 20.0
Total 23.2
4.3.4. Food Security and Rural Development
In 2001, TACIS supported twelve continuing projects in the food and agriculture
sector in Russia. Two of these focused on promoting agricultural co-operation
(production, processing, and credit co-operatives) in three pilot regions. Another
aimed to promote reform through agricultural training and education. TACIS also
tackled the issue of food quality through a project working in different regions on
selected food products. In addition, there were two projects on farm restructuring (in
Astrakhan and in the Urals), another on agricultural advice centres in South Russia,
and one more, working at the federal level, gave guidance to the Ministry of
Agriculture and Food in promoting new policies.
Information on allthe projects completed in 2001 was widely disseminated so that it
can be replicated acrossthe region.
In the rest ofthe Newly Independent States, there were seventeen continuing projects
covering all aspects of rural development: improved agriculture production (crops
and livestock); agri-processing; marketing/distribution of produce; land
privatisation/registration; improved seed production/multiplication; development of
agriculturalassociations and co-operatives; ruralcredit facilities; food quality/safety;
and water use/irrigation for agriculture.
EU-Russia Food Delivery Programme
Council Regulation (EC) 2802/98 of 17 December 1998 mandated the EC to undertake the
delivery of food products to the Russian Federation. This programme was the largest ever food
delivery undertaken by the EC in the region (about 1.85 million tonnes to over 50 regions) with
ab u d g e te x p e n d i t u r eo f €400million.
The delivery of products was completed in April 2000 with almost all products sold at prices
reflecting the prevailing market value. The proceeds of these sales were lodged in a special
account at the Russian Ministry of Finance. The objective was to use these funds to clear
pension arrears (80%) and to support the ministries for Health and Labour (20%). The year
2001 was devoted to the management of the special account. In addition to the complex nature
of the food delivery programme, difficulties were encountered regarding the collection and use
of co-finance.
As required by the Council Regulation, the Commission commissioned an external audit of the
programme. Thefindingsof thisaudit weretobe deliveredinearly2002.
99Policy Development, TrainingandManagementSupport
toAgriculturalEnterprisesinCropProduction
This project ran between February 1999 and November 2001. It was designed to improve crop
productioninMongolia througha seriesof practical demonstrationsof, for example, correct use
of fertilisers, seed multiplication, improved irrigation techniques, minimum tillage and chemical
fallow. This project has shown that significant and quantifiable improvements in both crop
quality and quantity were possible with minimal capital outlay. The results of these
demonstrations were widely disseminated through a series of open field days and through
regular coverage of the project’s activities in local and national media. The project established
five agricultural advice centres, which provide a wide range of advice and information to the
entireagriculturalcommunity.
There wasactive support from the Ministry of Agriculture throughout and the Government has
alreadyimplementedmany of the project’srecommendations.
4.3.5. Institution Building
Institution building activities lie at the core of all TACIS support. These activities
support the development oftransparent, accountable and effective public institutions.
TACIS support includes provision of advice on administrative reform to individual
ministries, advice on development of modern legislation - where appropriate to be
compatible withEU standards - and support for reformofthe judiciary.
It is also worth highlighting the newly established TACIS Institution Building
Partnership Programme supports three main types of partnership co-operation –
between centralgovernment ministries and agencies, between municipal and regional
governments and amongst NGOs. The partnerships involve officials from EU
Member States being seconded to work directly within the beneficiary institution, for
example to help prepare new legislation, reform institutional structures, provide
training on systems software, provide training on the ground or in the EU Member
State.
Thirty institution building projects with an environmental perspective were
implemented in 2001. Many of these focussed on institutional development of
nationaland localgovernment. There were also two major co-financing projects, one
in St Petersburg, Russia, designed to reduce pollution in the Baltic Sea, and one in
the Black Sea region, which aim to improve water quality, tourism and public health
in two Ukrainian coastal towns. Further investment support for municipal services
was launched during the year.
As to economic development, reform is still needed in some crucial areas including
legal frameworks for the private sector, trade and investment policies, taxation andaccess to finance. TACIS projects and programmes aimed to address these problems
both at grass roots level (development of Small and Medium Enterprises - SMEs)
and at the institutional level.
100InstitutionalBuilding – Commitments 2001 ( €million)
Country Amount
Georgia 3.0
Kazakhstan 9.0
Kyrgyzstan 4.7
Moldova 9.7
Russia 45
Ukraine 20.5
TOTAL 91.9
4.3.6. Macroeconomic Policies
Facilitating economic reform and developing the private sector is a central objective
of the TACIS programme. In 2001 the EU’s strategy remained focused on
stimulating business growth whilst continuing to provide support to the new
institutions of the market economy. Co-operation with other international bodies has
been actively pursued, while strong relationships with local partners continue to be
nurtured.
The challenges for TACIS continue to include the current regulatory environment,
inadequate access to finance and investment and poor quality of business practices.
Europeanprojects focussed onthese problemareas with nearly 200 projects ofa total
budget of almost €300 million. Projects such as Supporting Accounting Reform in
Azerbaijan and Supporting WTO Accession - as well as support to the development
of a small business culture in Russia - characterised this trend. By addressing legal
and political reform while helping business to get on its feet, EU projects remained
vitally important principally in the Russian Federation and throughout the Newly
Independent States.
Under the first phase of the Managers’ Training Programme (MTP), the EU
internship programme for NewlyIndependent States’ managers, facilitated some 440
internships during 2001 in EU companies, lasting up to three months. During 2001
anadditional €9.1 million for MTP was contracted.
MERIT1 –Support toMonoactivity Towns, in particular the Development of Coal Mining
CitiesRussianFederation
This project aimed to strengthen five selected coal region cities in order to turn them into
motors for urban and regional development. It supported the role of newly emerging municipal
administrations in coal-mining towns that are affected by industrial re-structuring. Activities
included supporting the development of economic strategies, developing the strategies and
capabilities for attracting investment into the areas, developing local capacity through training,
supporting the SME infrastructure, developing micro- credit fu nds, and preparing a
dissemination strategy to involve all mining towns. A series of Flagship Initiatives were
implemented in each town as the focal point for a connected series of economic regeneration
activities. The Municipal Development Planning Process was - and will continue to be after
TACIS – ‘participatory’ in all towns i.e. taking into consideration the views of the wider
community includingrepresentatives of the local authority, business and social sectors.
101Macroeconomic Assistance - Commitments in 2001( €million)
Country Amount
Georgia 1.0
Kazakhstan 2.5
Kyrgyzstan 2.8
Moldova 3.0
Russia 22.0
Ukraine 13.0
TOTAL 44.3
4.3.7. Health and Education
4.3.7.1. Health
The decline in health services in Eastern and Central Europe has contributed to a
drop in life expectancy, often dramatic. For instance, the life expectancy rate has
dropped from 68 to 58 in Russia over the past decade. A large number of illnesses
that were under control or had even disappeared have re-emerged, and are on the
rise, including diphtheria, cholera and tuberculosis. AIDS is also progressing in an
uncheckedway.
The European Commission addresses the health issues in particular in its assistance
programme for Uzbekistan. The table below gives a summary of TACIS actions in
the healthsectorduring the period of2000-2001.
Projects being prepared include ‘Tuberculosis prevention and control (Kiev City) in
the Ukraine ( €2 million), ‘Integrated Community Primary Health-support to the
Kakhetiregion’ in Georgia ( €5 –7 million), and ‘Regional Health in Uzbekistan’ ( €
2 million).
4.3.7.2. Education
The principal instrument for TACIS support in the education sector is the Tempus84
programme. The aimof this programme is to support the reform and restructuring of
higher education systems in the Newly Independent States and to help adapt them to
new socio-economic needs. Tempus has three principal strands: Joint European
Projects(JEPs),Networking Projects(NP) and IndividualMobilityGrants(IMGs).
84Tempus aims to support the reform of the higher education system in Central and Eastern Europe,
covering: Armenia, Azerbaijan, Belarus, Georgia, Mongolia, Russia, Ukraineand Uzbekistan
102SocialDevelopment - Commitments in 2001 ( €million)
Country Amount
Kazakhstan 1.0
Kyrgyzstan 0.9
Moldova 6.8
Russia 23.0
Ukraine 13.5
TOTAL 45.2
4.3.8. Cross Cutting Issues
4.3.8.1. EuropeanInitiative for Democracyand HumanRights
In 2001, the European Initiative for Democracy and Human Rights (EIDHR)
implemented projects in Eastern Europe, the Caucasus and Central Asia to a value of
more than €7.5 million.
The EIDHR committed €2.6millionto a project aimed at the promotion and defence
of Human Rights and fundamental liberties in the Russian Federation. The objective
of this project was to reinforce and protect Human Rights as part of a monitoring
programme for the 89 regions of Russia, and notably the North Caucasus. In
Georgia, the EIDHR has implemented a project on the rehabilitation of survivors of
torture and for the prevention oftorture in the future.
EIDHR has provided €3 million for support for the process of democratisation and
reinforcement of good governance. In Belarus, a joint project with the Organisation
for Securityand Co-operation inEurope, started in 1999, has increased knowledge of
Human Rights issues amongst young people. In Russia, a joint programme with the
Council of Europe (CoE) is reinforcing good governance and the protection of
Human Rights. In the Ukraine, a joint programme with the CoE is reinforcing
democratic stability and working to prevent conflict. A body of work on European
norms of governance, Human Rights and humane treatment of prisoners has also
beenadoptedinMoldova.
Support for conflict prevention and peace promotion is a major priority for EIDHR.
In 2001, the EC worked with the Council of Europe on a programme to assist
Armenia, Azerbaijan and Georgia with their accession to the Council of Europe; in
particular with the creation of democratic societies based on good governance,
tolerance and a respect for Human Rights. Another joint project aimed to combat
corruption and organised crime, as well as reinforcing measures to reduce conflict
and promote good governance. For the first time, 2001 saw the EIDHR involved in
conflict preventionand capacitybuilding for HumanRights inthe Caucasus.
1034.3.8.2. NGOs’ Activities
The development of civil society is another core component the TACIS programme,
especiallyas regards support forinstitutional, legaland administrative reform.
A special Civil Society Development Programme for civil society in Belarus was
approved in Minsk in November 1999. Implementation started in early 2001. There
are 24 NGO projects, 5 media projects and one institutional twinning project under
implementation.
The final proposals for the TACIS Lien programme (which promotes partnerships
between NGOs) were submitted in spring 2001. Twenty projects were selected and
are now being implemented. The totalproject value is €3.2 million. The TACIS City
Twinning programme has 35 ongoing projects (total budget €3.5 million) that will
come to anend in2002.
Lien and City Twinning programmes have been replaced by the Institution Building
Partnership Programme / Support to Civil Society and Local Initiatives. The new
programme targets NGOs, local and regional authorities and professional
associations. It supports an institution-building process through EU / Newly
Independent States’ partnership co-operation at a grass-roots level. A call for
proposals was launched inDecember 2001 and the project implementation is planned
to start inautumn2002. The totalbudget forthis programme is €15 million over two
years.
‘NGO assistance todisabledpeople’
and ‘Creation of a consultation Centre for Invalid Children’
This project was developed by Belarussian NGOs to increase their capacity to help disabled
people. It aims to develop co-operation between NGOs and the Employment Services for the
creation of job opportunities for the disabled, to review existing legislation and propose new
regulations to facilitate the employment of disabled people. The premises for the project office
have been provided free of charge within the Ministry of Labour. This constitutes a major
signal from the national authorities. It is hoped that the project will produce positive and
sustainable results as a good example of NGO assistance and co-operation with the government
of Belarus.
4.3.9. Coherence with other policies
Coherence with other policies takes two forms. Firstly, the European Commission
carefully co-ordinates proposed TACIS assistance activities with the Commission
Directorates-Generalresponsible for allother relevant EU sectoralpolicies, including
environment, energy, transport, justice and home affairs, competition, trade,
employment and regionalpolicy.
For example, as TACIS assistance to the Western Newly Independent States is often
partofa broader framework involving Community support to the accession countries
through PHARE and Interreg85it is also essential to ensure better co-ordination
between TACIS, PHARE and Interreg. In April 2001, the Commission produced a
85Interreg is an EC initiative, financed by the EC’s Structural Funds, which promotes Interregional co-
o p e ra t i o ni nE U( i n t e r n a l )c ro s sb o rd e ra re a s
104‘ P r a c t i c a lG u i d et ob r i n g i n gI n t e r r e ga n dT A C I Sf u n d i n gt o g e t h e r ’86as a first step
towards co-ordinating these two instruments.
In addition, the European Commission is endeavouring to ensure that the TACIS
programme is complementary to support provided to these countries through other
EC instruments; For example, the Moldova and Kyrgyzstan programmes developed
during 2001 contain elements linked with projects undertaken through the EC Food
Security Programme. Similarly, where appropriate, the TACIS activities in the
sphere of private sector and economic development seek to create a favourable
climate, compatible withthe conditions stipulated in the terms of EC macroeconomic
assistance (see chapter 7).
4.3.10. Co-operation with Other Donors
Continued coordination and complementarity with the activities of other donors, and
in particular with EU Member States, is a key strategic priority for TACIS. Greater
coordination at the country level is a direct result of growing relationships between
the EC Delegations and Member States’ own representations in partner countries.
New programmes are prepared in close consultation with other donors and through
formal Commission approval processes (such as the TACIS Management
Committee). Relationships with non-EU organisations - in particular the World Bank
and the International Monetary Fund - are being strengthened by ongoing co-
operation, especially in such areas as implementation of the PRSP and, in
Kyrgyzstan, ofthe Comprehensive Development Framework .
4.3.11. ECHO
In2001, the overallhumanitariansituation in the NIShas not improved significantly.
It is evident that the root causes of the difficult humanitarian situation faced by the
most vulnerable strata of society in the NIS are of a structural nature. They have to
be addressed by a more sustainable, long-term approach – and are therefore beyond
ECHO’s mandate. However, in the light of certain delays in the taking over of
activities by Commission instruments more appropriate than ECHO, the
Humanitarian Aid Office continued assistance, albeit to a reduced extent. The aim
was to alleviate the precarious situation of the most vulnerable groups,
including children in institutions, lonely elderly and disabled people, multi-child
families at risk. In 2001, ECHO continued and practically completed its phasing out
inBelarus, Moldova andUkraineas wellas in the Southern Caucasus ( Azerbaijan ,
Georgia,Armenia ).
B yt h es a m et o k e n ,i n Tajikistan overall Global Plan funding was reduced further
(to €10 million), with the food, medical and water and sanitation sectors being given
priority. However, inresponse to the second consecutive severe drought affecting the
country, an additional €2 million emergency decision was taken to fund small-scale
food security programs, benefiting the most vulnerable rural population. ECHO is
continuing its gradual phasing out from the country (due to be completed by the end
of 2003). Close co-operation with other Commission services is continued to bring
about a smooth transition from relief (so far funded by ECHO) to rehabilitation and
development activities (supported by more appropriate Commission instruments and
Member States), catering for the coverage of needs in the longer term. The
86Seehttp://europa.eu.int/comm/regional_policy/Interreg3/doc/docu_en.htm
105heightened international attention given to Central Asia in connection with the
Afghancrisis appears to be acting as a catalyst inregard tothe latter issue.
In theRussian Federation, ECHO remained involved in the Northern Caucasus,
covering the significant humanitarian needs of the population affected by the –
second - Chechnya conflict ( €40,35million). The conflict erupted in late 1999, and a
political solution is still not in sight. Armed hostilities in Chechnya have entailed
large displacements of people in the Northern Caucasus region, notably from
Chechnya into neighbouring Ingushetia (accommodating some 150,000 IDPs).
However, efforts by the international aid community to help cover those needs have
often been thwarted byextremelydifficult working conditions, in particularly due to
an erratic and opaque access system to Chechnya and the lack of NGO access to
VHF radio communication (crucial for the security of humanitarian staff). ECHO
funding benefited some 400,000 civilians, victims of the conflict, providing them
with basic food aid, enhancing the water and sanitation conditions for both IDPs in
camps and spontaneous settlements in Ingushetia and the resident population in the
Chechen capital of Grozny. In addition, 40,000 IDPs living in camps both in
Ingushetia and Chechnya benefited from primary health care services provided by
ECHO partners. IDPs, returnees and residents throughout the Northern Caucasus
received ECHO-funded protection activities, notably legal counselling; and the
coordinationof internationalhumanitarianassistance was supported.
Also in 2001, ECHO allocated €1.03 million to respond to humanitarian needs
created bythe disastrous winter, which affected a large part of the ruralpopulation in
Mongolia . Operations were financed to help 40,000 of the most vulnerable people
withbasic food items and agriculturalinputs.
ECHO FinancialDecisions 2001 ( €million)
Country/sub-region Amount
Belarus, Moldova, Ukraine 1.900
Mongolia 1.030
Russian Federation(Chechnya crisis) 40.350
Armenia, Georgia 3.150
Tajikistan 12.000
TOTAL 58.430
4.3.12. Monitoring
All TACIS national and regional projects were subject to regular monitoring
missions byexternalmonitors in2001.
Their performance was onaverage assessed as between average and good, with some
greatertendencyto the latter inprojects completed in2001.
TACIS monitoring teams operated from four regional offices in Moscow, Kiev,
Almaty and Tbilisi with most of the monitoring work undertaken by long-term
resident specialists. At the end of 2001, TACIS monitoring was integrated into the
globalmonitoringsystem.
1064.3.13. Conclusions and Perspectives
The TACIS programme is now an established player in Europe, the Caucasus and
Central Asia and is gradually adapting to the changing needs of its partners as the
transition process comes to an end and is replaced by new challenges. In particular,
TACIS is now taking account of growing differences between each partner country,
whilst ensuring that regionalinterventions are appropriatelytargeted towards genuine
regional needs. Under the new TACIS regulation, the programme will continue to be
directed in the areas where it has the greatest record of effectiveness. As such, it will
focus primarily on support for institutional, legal and administrative reform whilst
phasing out activities in rural development. As the enlargement process continues,
the EC assistance will focus oncross-border and regionalissues between the Western
Newly Independent States and those countries on the verge ofEU membership.
1074.4. Southern Mediterranean and Middle East
The Euro-Mediterranean partnership was launched seven years ago against a background of
regional instability and a worsening Middle-East conflict. Today, it is worth reaffirming the
strategic importance of that partnership, established in Barcelona in 1995 by the fifteen
Member States of the European Union and the twelve Mediterranean partner countries. As a
model for co-operation, it now extends far beyond the economic sphere and aims to promote
lasting regional stability as an indispensable pre-condition for any attempt to bring shared
prosperityto the Mediterraneanregion.
In 2001, the Euro-Mediterranean partnership has come of age. It is the only regional forum
for discussion and stands for a unique comprehensive and evolutionary approach to
development, a vehicle for the implementation of common policies and strategies in the
region.
At present, the Euro-Mediterranean Association Agreements concluded with or being
negotiated with nine partner countries constitute the main framework for bilateral co-
operationwiththeEU.These Agreementsalso reinforce linksbetweenthepartner countries at
regional level. Another example of these links is provided by the sub-regional free-trade
agreements, such as the Agadir process between Morocco, Tunisia, Egypt and Jordan, which
demonstrate these four Maghreb and Mashrek countries’ willingness to open up their
economies to eachother.
4.4.1. Introduction
Launched at the Barcelona Conference in 1995, the Euro-Mediterranean partnership
is the main vehicle for co-operation between the European Union and its
Mediterraneanpartners. It embraces all joint co-operation projects in an attempt meet
the political, economic, social and environmental challenges that will shape the
geopoliticalfutureoftheentireMediterraneanregion.
It is the lack of homogeneity and the fragility of the social fabric in the South
Mediterranean countries that is chiefly responsible for social exclusion and poverty.
In 2001, average per-capita income in the region was USD 1 512, with very
considerable differences between countries, ranging from USD 990 for Syria to over
USD 5 000 for Lebanon. Reducing these inequalities will require a special effort in
the fields of education, vocational training and health, and more co-operation with
the Member States and international organisations. Fighting poverty forms the basis
of the Community’s new approach to sustainable development and continues to be a
major objective behind the European Union’s strategy for co-operation with the
Mediterraneancountries.
Economic and socialdevelopment in the southern Mediterranean and Middle East is
vitaltothestabilityandprosperityofthewholeMediterraneanregion.
The MEDA programme87is the main financialinstrument inthe Euro-Mediterranean
partnership, accounting for 88% of total funding for co-operation projects in 2001.
87The Meda Programme is governed by Council Regulation (EC) No 1488/96 of 23 July 1996 on
financial and technical measures to accompany the reform of economic and social structures in theframework of the Euro-Mediterranean partnership, as amended by Council Regulation (EC) No2698/2000 of27 November 2000, commonlyreferred toas MedaII.
108The Union is also involved in special projects to support the Middle-East peace
process, to provide Palestinianrefugees withaid and to support democracy.
Euro-Mediterranean Association Agreements have already been concluded or are
being negotiated with nine Mediterranean partner countries. These Agreements form
the strategic framework for Community bilateral-co-operation projects. Significant
progress was made in 2001 with Algeria and Lebanon, both of which signed
association agreements with the European Union. Priority was given to projects in
the national indicative programmes (NIPs) which were drawn up jointly with the
nine partner countries and which cover the following areas: economic transition
(structural adjustment and development of the private sector), maintenance of social
cohesion(education, healthandruraldevelopment) andpromotionofcivilsociety.
Euro-Mediterranean Agreements in2001
Agreementsalreadyin force Tunisia, Palestinian Authority(*), Israel, Morocco
Ratification pending Jordan (**), Egypt (***), Algeria(****), Lebanon (****)
Negotiationsunderway Syria
(*) Transitionalagreement
(**) TheAssociation Agreement with Jordan shouldberatifiedin March 2002;itis dueto enter into force in
May2002
(***) TheAssociation Agreement with Egypt was signed on 26 June2001
(****) An Association Agreement was signed with Algeria on 19 D ecember 2001 and sould be signed with
Lebanon on 10January2002
For 2001, the Commission committed a total of €857.8 million in co-operation
measures linked to the Euro-Mediterranean partnership, while payments amounted to
€564.6 million. The Meda programme itself received the largest share of
commitments in 2001 with €757.4 million. Meda payments totalled €403.7 million.
Commitments under the specific budget headings (peace process, UNRWA, aid for
Palestinian refugees) amounted to €100.4 million, while payments totalled €160.9
million.
109Euro-Mediterranean partnership: commitments and payments 2001 ( €million)
Commitments Payments
Programme 2001 2000 2001 2000
MEDA
Algeria
West Bank/ GazaEgypt
Jordan
LebanonMoroccoSyria
Tunisia
Turkey(excludingglobalallocation)60
--
20
-
120
8
90
147*30.2
96.712.7
15
-
140.6
38
75.7
310.4*5.4
62
62.5
10.8
2
41.1
1.9
69
86.40.4
31.264.4
84.5
30.739.9
0.3
15.9
15.2
MEDAbilateral 445 719.3 341.1 282.5
MEDA Regional 312.4 159.8 62.6 48
Total bilateral/regional 757.4 879.1 403.7 330.5
Other budget headings 100.4 122.8 160.9 141.7
TOTAL 857.8 1,002 564.6 472.2
* The funds committed for Turkey under the Meda Programme (budget heading B7-4100) are administered
directlybyDGEnlargement.
Commitment / Payments 1995-2001 ( €million)
19951996199719981999 2000 2001 Total
Commitments 173 404 981 941 937 879.1 757.4 5071.6
Payments 50 155 211 231 243 330.5 403.7 1624
Paymentsaspercentageofcommitments29% 38% 21% 24% 26% 37.6% 53.3% 32.0%
4.4.2. Regional co-operation
Regionalco-operation is one ofthe most original features ofthe Euro-Mediterranean
partnership and can take the form of joint activities, exchanges of experience and
information involving the 27 partner countries and territories on both sides of the
Mediterranean. A Regional Indicative Programme provides the framework for
regional co-operation. This is implemented through individual regional programmes
devotedto specific areas.
In 2001, regional co-operation was given a boost when the Commission adopted a
f i n an ci n gpl anf or €200 million, which was also committed in 2001. The plan relates
to seven specific programmes to be implemented over a number of years. The idea
behind the plan is to put certain existing activities and projects on a more permanent
footing, in fields such as the environment ( €30 million) or cultural youth exchanges
( €10 million), but it also provides for new measures in areas such as risk capital ( €
50 million) and transport ( €20 million).
110Under the heading of politics and security, the Commission has pushed ahead with
effective implementation of three measures aimed at bringing countries and peoples
closer together: two training seminars were held for diplomats from the Meda
countries; funding was provided for the EuroMeSCo network bringing together
independent specialists from foreign-policy institutes; the national civil-protection
agencies from the 27 Euro-Mediterranean partner countries sent people to take part
in four training courses as part of a pilot scheme to improve prevention of accidents
and naturalcatastrophes.
Under the heading of economic and financial matters, the Commission has continued
to implement ongoing programmes and projects in the fields of energy, the
environment, the information society and statistics. Five water-management projects
were launched, and five aimed at improving maritime safety. Work on industrial co-
operation concentrated on three themes: promoting investment, fostering innovation,
technology and quality in business and developing policy instruments for the Euro-
Mediterranean market. Four energy projects were launched and sixteen proposals
concerning technology for the information society were selected last year under the
programme. Five environment projects started in 2001. They cover a wide range of
measures from the treatment and management of urban waste to the promotion of
organic farming. In the field of statistics, the aim is still to harmonise figures in all
fields relating to Euro-Mediterranean co-operation. Two statistical yearbooks have
beenpublished, onea yearbookofregionaldatatheotherofstatisticsontourism.88
Under the social, cultural and human heading, there were six regional-co-operation
projects under the Euromed Audio-visual Programme, 26 projects under the Youth
Programme and, under the Heritage Programme, fifteen projects aimed at preserving
the Mediterranean area’s common heritage, with a further ten proposals selected for
phase II). The promotion of women in economic development and the development
of judicial co-operation were identified as two new priority fields. Lastly, the EU
decided to start workona regionalprogramme oninformationand communication.
Young MoroccanandEuropeanvolunteersinvolvedinthesocial projectinTunis
In December 2001, as part of the Euromed Youth Programme, four young European women
– two German and two French – and two young Moroccan women jointly ran a number ofsocial-welfare projects in some very deprived areas of Tunis. They helped take care of oldpeople and abandoned children in two social centres in La Maouba. They also helpedunderprivileged girls from a rural background in the Chebedda district, as well as youngwomen in the Radés welfare centre. The EU provided
€20 000 for the operation, whichlasted
six months. ATAV, the Tunisian Voluntary Action Association took care of coordination on
the groundandaccommodationandother arrangementsfor the young volunteers.
88Euro-Mediterranean statistics -ISSN1561-4034–Tourism trends in Mediterranean countries - ISBN 92-894-0066-8 – Official Publications Office of theEuropean Communities –L–2985–Luxembourg.
111Regionalco-operation: projects committed in 2001( €million)
Regional
co-operationProject title Amount
Water management* 40
Transport policy* 20
SMAP II (ShortandMedium-Term PriorityEnvironmental
Action Programme)*30
Medstat II* 30
EumedisII* 20
Euromed Youth II* 10
EIB – Risk Capital* 50
CGIAR(ConsultativeGroup on InternationalAgricultural
Research)1.5
EnergyForum 2
Re-commitments 24.8
Variousregionalactivities 4.3
SUB-TOTAL 232.4
Global allocation 33
Technical assistance 46.8
TOTAL 312.4
*Projects included in the Meda regional financing plan worth €200 million in
total.
4.4.3. Transport and infrastructure
Measures to develop and consolidate basic infrastructure and transport, energy and
telecommunications networks as partofbilateraland regional programmes are in line
with the priority objectives of the Euro-Mediterranean partnership. In pursuit of
those objectives, 49 projects were implemented in 2001 under bilateral programmes,
accounting for commitments ofsome €570 million in total.
In2001, efforts were concentratedonmeshing together and coordinating proposed or
existing programmes with other Community measures such as those run by the
European Investment Bank and the Member States. Protection of the environment
and the implications for on sustainable development were systematically taken into
account at the preparatoryproject-evaluationstage.
Inoperationalterms, the main results for 2001 areas follows:
In Morocco, 2001 saw an increase in the rate of Community support for the
development of public services responsible for water management, energy and
transport. With regard to water and sanitation in rural areas, improvements weremade tothe watersupplyto 13 towns and 438 douars, with a combined population of
423 000; work continued on the construction of 65 km of rural tracks in the northern
provinces (payments worth €3.25 million were made); a major decentralised
electrification programme was launched, covering 15 000 Moroccan homes ,i nc o -
operation with Germany and France and local authorities. In addition, progress hasbeen made in opening up the coastal regions in the north of the country, with
112completion of the preparatory stage in the construction of the El Jehba-Ajdir section
of the “Mediterranean rocade” link road (109 Km) and the ongoing work on the
social infrastructure around Rabat with a view to rehousing 20 000 inhabitants of the
shantytownofSalé ( €1 millionpaid out in2001).
In Syria, three new financing agreements worth €24 million were signed in 2001
covering electricity, telecommunications and cultural tourism. This demonstrates asustained increase in the rate of co-operation. The programmes are just starting up. It
was also decided that a sanitation programme for Palestinian refugee camps in Syria
would be given €8 million in funding.
In Jordan, a technical-assistance team was formed, attached to the Project
Management Unit (40 people). The team is responsible for coordinating programmes
concerned with the rehabilitation and development of water systems in the Amman
region and it is now operational. People in the Karak and Tafilah regions have been
provided with access to an essential public service thanks to the water-supply
projects begun in 2001. Lastly, the Commission is supporting the development of
cultural tourism with improvements to two archaeological sites and technical
assistance for the Tourist Council.
InWest Bank and the Gaza Strip, inspite of deteriorating situation and the tightening
of the blockade around the autonomous Palestinian territories, improving living
conditions for the Palestinian populations remains the European Union’s priority
objective. Ongoing work on basic infrastructure (such as schools, roads, primary
health-care centres, sanitation networks, refuse collection etc.) is an achievement initself. This infrastructure must be maintained and further extended. It will enable the
Palestinian economy to recover more quickly when the right conditions have been
restored. One notable success was the Gaza hospital, with 188 beds and serving a
population of 350 000. In 2001, all departments became fully operational and are
now treating around 2000 patients a month. Lastly, the library of the rehabilitated
École Biblique in Jerusalem was inaugurated on 17 November 2001 by CommissionPresident, Romano Prodi.
Constructionof schoolsinWestBankandtheGaza strip
Between 1996 and 2001, 21 schools and educational facilities were built in West Bank and the
Gaza Strip. The project, aimed at providing basic infrastructure for primary and secondary
education, was made possible by the €14 million provided by the EC.
The Palestinian municipalities that received the support now have 311 new classrooms with a
combined capacity of 14 000 pupils. In addition to the educational benefits, the project has also
had a significant effect on the country’s economic and social environment, generating some
100 000workingdaysfor Palestinianlabourers,managers,constructionexpertsand suppliersof
materials.
Lastly, in Iran, an aid programme provided funds for equipment and additional
infrastructure for two existing hospitals in Manjil and Abbar Taroum. The work is
now nearing completion.
113Transport and infrastructure: Projects committed in2001 ( €million)
Transport and
infrastructureCountry Project title Amount
Water Morocco Water – sectoral adjustment 120
Water Syria Health environment/refugeecamps 8
TOTAL 128
4.4.4. Rural development andfoodsecurity
Some 70% of people classed as poor in the Middle East and North Africa, live in
rural areas where living conditions are generally more precarious than in urban
centres. While rural under-development in most of the South Mediterranean
countries is linked to climate, the upsetting of natural balances by over-exploitation
ofnaturalecosystems is also partlyto blame.
In 2001, development activities were primarily concerned with creating permanent
productive employment, strengthening fundamental organisations and managing
naturalresources such as water in a sustainable way, and protecting fertile land from
soil erosion. At the operational level, there were 25 projects ongoing in 2001,
accounting for €433 million in commitments and concentrated on three countries:
Egypt (seven projects accounting for €105 million), Morocco (eight projects
accounting for €182 million) and Tunisia (five projects accounting for €132 million.
There were five further projects in other countries in that region, (accounting for €
14 million).
European aid for food security is given in accordance with the Rome Declaration of
the World Food Summit ofNovember 1996. The EU’s aim is to help the most needy
sections of the population in the South Mediterranean get an adequate diet, in
quantitative and qualitative terms, and to ensure they enjoy the most basic standards
ofhygiene.
In Yemen, cereal production is falling sharply and now provides only 25% of the population’s
total consumption. Through the Yemeni Government’s strategic poverty-reduction programme,
in 2001 the Commission provided budget support and technical assistance in three area: (i)
institutional support to assist with the task of defining objectives and implement the national
food security strategy (together with financial support for the social-security fund); (ii) support
for the agricultural-census system, with an additional study on the information system for
agricultural markets; (iii) provision of funds to cover 75% of the cost of food-security
programming and implementation of support measures (e.g. construction of small dams for
irrigation; vocational-trainingprogrammesandaccesstomicro-credit).
The main measures – modernisation of productive private businesses, improvementof existing large-scale irrigation schemes and support for initiatives by grassroots
rural communities – have all increased food security. Food supplies to towns have
also been improved and the growth in imports has been brought under firmer control.
Lastly, the need for sustainable management of natural resources and the rural
environment has beenconsistentlytaken into account inallaspects ofeverymeasure.
On the basis of the operational priorities identified in co-operation with the partner
countries, the following measures were startedor continued with in2001:
114Modernisationofagriculturalbusinesses
Actingthroughthespecialised nationaland localinstitutions, thisprogramme aims to
provide agricultural entrepreneurs in Egypt and Morocco with the technical and
financialsupport theyrequire to fund and carryout their projects.
In Egypt, some medium-term loans from local banks and advice on financial management
funded by the European Commission have enabled some 3000 small private producers to build
up their businesses, diversifying in response to the requirements of the market. Thanks to good
management, the project hasmade averysignificantimpact:there has been a big rise in sales of
poultry products, dairy products, farmed fish and vegetables, leading to the creation of some
30000jobs and raisingincomes for almost 50000people.
The training given to Egyptian and Moroccan farmers is essential if large-scaleirrigation is to succeed and water resources better managed. As a result of the
reforms, the volume ofwater required per hectare ofland has beencut by30%.
In Egypt, new, more efficient, water-saving irrigation methods have made it possible to irrigate
20 000 ha of reclaimed floodland , benefiting 8 000 farming families in 33 associations .A sa
result, production of cereals and forage has risen by 30% and farming revenues by 20%. The
projects funded by the EC were concerned with drainage and fencing, support for user
associations, technical advice for producers and infrastructure to provide access to production
areas.
Support for initiatives byruralgrass-roots communities
In Tunisia and Morocco, the Commission helps grass roots communities to plan and
implement independently measures that they consider are most pressing in order to
improve their living conditions and manage their land in a sustainable way. The
Commission supports small-scale agricultural water engineering schemes, rural
tracks and conservation of water and soil. By stabilising farming incomes and
checking desertification, these projects will act as a brake on migration to towns and
other countries.
In Tunisia, work has beendone on 480lakesand 45000haof drainage basin and over 20 000 ha
put in cultivation, including 5 000 ha of irrigated farm land. 80 cooperatives responsible for
marketing agricultural produce, serve basic units grouped around each lake. Sales of dates and
olives have risen significantly. Around a hundred participatory local development plans are
currentlyinoperation, benefiting over 6 000 people.
Protectionofthe coastalenvironment and biodiversity
If the park and protected areas are to remain viable, it is important that the
institutions responsible for local environmental management be strengthened. To
enable them to carry out their duties, plans have been made to improve recovery of
coststhrough by developing the system of taxes to be paid by the various businesses
in the tourist industry in South Sinai.
In South Sinai in Egypt, a national park and five protected areas covering 12 000 km2 have
been created, paving the way for the conservation of over 200 km of coral and many fragile
coastal ecosystems on the Red Sea. Protecting these unspoilt natural sites is a double challenge
with implications for the environment and the tourist industry alike. It will enable protection of
the environment to go hand in had with harmonious and controlled development of tourism,
essentially international in character and bringing with it 100 000 jobs in the hotel and leisure
industry.
1154.4.5. Institutional support
Institutionalsupport is givenunder the arrangements for bilateralactivities within the
Euro-Mediterranean Partnership, which means measures are agreed on jointly by the
European Commission and the relevant authorities and organisations in each partner
country. Thus, for example, the various sectoral measures to promote modernisation
and democratisation in the EU’s Mediterranean partners go hand in hand with radical
reformofpublic servicesand the regulatoryframework.
In2001, the Commission funded two new institutional-support projects:
Support forreformofthe Algerianpolice
This project, launched in2001 for aperiod ofsix years with €8.2 million, committed
in 2000, sets out to reinforce good governance and the rule of law in Algeria. In
practice, a series of measures are planned to raise professional standards amongst
Algerian national-security staff by stressing the importance of Human Rights when
theyare fulfilling their securityfunctions.
Support for Algerian journalists and the Algerian media. €1.53 million were
allocated to this four-and-a-half-year project in 2000 which began in 2001. The
objective is to reinforce the role played by the independent privately owned press in
Algeria and to support the much-needed democratisation of Algerian society. In
more specific terms, the project involves strengthening journalism as a profession
through the adoption of a professional charter for journalists, the drafting and
adoption of a collective agreement for the press and the adoption of a code of
professionalethics.
Institutionalsupport: projectscommitted in 2001( €million)
Institution
buildingCountry Project title Amount
Justice Jordan Regulatoryreforms / Privatisation 20
Justice Turkey* Modernisation ofthelegalsystem and penal
reform(JMPR)8
Communityacquis Turkey* Evaluation ofpre-accession projects 5
Communityacquis Turkey* Administrativeco-operation facilityII 8
Communityacquis Turkey* Participation in Communityprogrammesand
agencies11
Communityacquis Turkey* Civil-servicemodernisation programme 2.5
Communityacquis Turkey* Local governmentreformprogramme 3.5
Communityacquis Turkey* Extension ofTAIEXtocover Turkey 6
Communityacquis Turkey* Upgrading statisticalsystem 15.3
TOTAL 79.3
* Commitments for Turkey under the Meda Programme (budget heading B7-4100) are administered
directlyby DG Enlargement
4.4.6. Macroeconomic policies
The Maghreb and Mashreq economies have no legal or institutional framework
capable of fostering private enterprise. They have a tradition of strong state
116intervention in the main sectors of the economy and an underdeveloped intermediary
financial industry. Furthermore, a major imbalance between urban and rural areas
only aggravates social inequalities and has a dramatic effect on the distribution of
private incomes. Against this background of economic uncertainty, the reflationary
policies of the 1970s and 1980s, characterised by spiralling expenditure, further
added to the size of budget deficits. Stab ilisation policies were needed to reduce
those deficits and to stave offthe threat offinancialcrisis.
In the initial phase, the priority objective of the programmes and projects funded by
the Meda Programme was to support the stabilisation process and economic
transition of the partner countries. This is in fact a double objective: it involves
promoting reform of the tax system and the state’s gradual withdrawal from
manufacturing activities through extensive privatisation programmes but it also
entails modernisation of the legal and regulatory framework, an essential
pre-condition for more private investment (e.g. a programme supporting industrialrestructuring in Algeria and an industrialmodernisationprogramme in Jordan).
Algeria:Support for modernisation of the financial sector ( €23.5million)
This project was launched in September 2001 for four years. Worth €23.5 million, which was
committed in 1999, the project aims to provide the Algerian treasury, the Central Bank of
Algeria, public-sector banks, insurance companies and various private-sector financial bodieswith technical support. Twinning arrangement are also planned between Algerian financialinstitutions and their European counterparts. Up to five institutions – three banks and twoinsurance companies – can take part. The project is a new departure in that it will create thefirsttwinningarrangement inthe Maghrebregion under the Meda Programme.
Jordan: Support for regulatory reformand privatisation ( €20 million)
This project is in line with the priorities identified in the National Indicative Plan 2000-02. Its
aim is to help ensure that Jordan’s economic transition goes smoothly by promotingdisengagement by the state and the adoption of a new regulatory framework in the mostimportant sectors of theeconomy.
Implementationof the project startedwiththe launch of two inter-connectedstudies. The first
will investigate how viable an integration strategy would be and what the effect would be of
merging the regulatory authorities. The second study is concerned with the introduction ofcompensationmechanisms to ensure that the people employed by the regulatory authority areof a high enough calibre. An operational action plan will be drawn up on the basis of thefindings from these two studies, and adopted jointly by the Commission and the JordanianGovernment. The ultimate objective is to bring about a significant rise in productivity and inthe levelof servicesprovided. TheEuropeanUnioniscontributing
€20 milliontothisproject.
In2001, atotalof €220 million– €20 million for Jordan, €120 million for Morocco
and €80 million for Tunisia – was committed for structural adjustment measures
falling withinthe scope ofeconomic co-operationwiththe Mediterraneancountries.
Implementation of this strategy is supported by Community programmes based on
structural adjustment facilities (SAFs). These provide for direct payments to the
countries’ treasury once a number of structural reforms devised together with thenationalauthorities have been implemented.
Operations to support macro-economic policies have focused on three general
objectives:
117•improving the legislative and regulatory framework governing private business
activity(SAFs for Jordan, Lebanon and Tunisia);
•reforming the tax system, particularly indirect taxes, to reduce the national
budget’s reliance on revenue from import duties, and thereby make the system
more efficient and fairer (SAFs for Lebanonand Jordan);
•increasing the pace of privatisation in the interests of: (i) more efficient allocation
of resources and enhanced competitiveness; (ii) increased budget resources; (iii)
more dynamic private investment, both domestic and foreign (SAFs for Lebanon,
Jordanand Tunisia).
The Commission also wants to promote adjustment in certain sectors by funding
measures designed specifically for those sectors but which should also boost GDP
and do nothing to undermine the stability of macroeconomic indicators. These
sector-based programmes have two concrete objectives: to reform the banking
systemand to strengthensocial-securitysystems.
Morocco: Structural adjustment programme for thewatersector( €120million)
In funding the SAF for the water industry, agreed on with the Moroccan authorities in 2001,
the Commission wants to promote more efficient use of thecountry’s water resources throughlegislative, regulatory, financial and technical measures designed to ensure a reliable, high-quality water supply despite declining reserves. The programme will directly benefit not just
the national institutions responsible for water use and purification but also, firstand foremost,consumersandallothersectorsof theMoroccaneconomy .
Morocco: Structural adjustment programme for thefinancial sector ( €52 million)
Discussions between national authorities and the Commission in the first quarter of 2000
revealed the need to make Morocco’s financial sector more competitive and more efficient.The financial-sector structural adjustment programme was approved in November 2000 aspart of the reforms of this sector under the Economic and Social Development Plan (2000-04).The SAF also provides for additional institutional and regulatory reforms designed to injectnew dynamism into the financial sector and diversify the financing of productive economicactivity. The Commission’s financial contribution is
€52 million in direct, non-linked budget
support. The funds are to be disbursed in three tranches. The initial input of €2 million and
the firsttrancheof €25 million weredisbursed in2001 .
Macroeconomic policies: Projects committed in 2001( €million)
Macroeconomic
policiesCountry Project title Amount
Structuraladjustment Tunisia SAFIII 80
Privatesector Turkey* SME 5
Privatesector Turkey* SME financialfacility 4
TOTAL 89
* The funds committed for Turkey under the Meda Programme (budget heading B7-4100) are directly
administered byDG Enlargement
1184.4.7. Health and education
Social development and, more specifically poverty reduction, are basic priorities for the
Euro-Mediterranean Partnership. They form an integral part of the third pillar of the
Barcelona Process launched in1995.
Accordingly, the Commission is implementing complementary sectoral strategies in areas
suchashealthandeducation.
4.4.7.1. Health
The health-care sector is especially important, not just for the economy but also for
reducing poverty and increasing social cohesion. Between 1998 and 2000, €
248 million were allocated to health care. The nature of Community assistance haschanged over the last decade: initially, Community projects were exclusively
concerned with maternal and child health but they have gradually evolved into a
means of supporting overall reform of health-care systems (including
health-insurance systems). Improving the way services are funded, and organisingthem in ways that improve the quality of the service provided, are both priority
objectives.
Two new programmes based on this new approach were implemented in 2001, in
Egypt and Morocco
. Similar programmes are being drawn up for Syria , Tunisia and
Yemen.89
Egypt –Support for thehealthcarereformprogramme
With a view to providing high-quality universal health care in the years to come, Egypt has
embarked on an ambitious programme to reform public and private health care services.This involves restructuring medical insurance and turning it into a universal system capableof providing a minimum “package” of health care services through family doctors. TheCommission is providing
€100 millionfor thiscomprehensive, seven-year reform programme
(1998-2005), launched by theEgyptianGovernment in1995. TheWorldBank and USAID arealsosupporting the reforms.
4.4.7.2. Education
The approach towards education is developing along similar lines. The Community
has moved from supporting targeted measures (as in Morocco, for example) to
pursuing a coherent strategy to complement national reforms, as in Tunisia and soon
in Algeria. Atotalof €184 million has beencommitted for 1998-2000.
Priority is given to primary and pre-school education, with support for literacy
campaigns. In all projects currently funded, particular attention has been given to
access to basic education for the most deprived sections of the population, women in
particular.
4.4.7.3. Vocationaltraining, labour market and employment
Developing vocational training is a priority for all Meda countries. Workers need to
be ever more highly qualified, which makes a coherent, long-term
vocational-training policy absolutely essential. The Commission is paying greater
89Measures in Yemen arenot finances from theMeda budgetheading.
119attention to the promotion of equal opportunities. €193 million has been invested in
the projectscurrentlyin progress.
In 2001, €60 million was committed for a major six-year programme for overall
implementation of a national vocational-training system in Algeria. The programme
aims to improve strategic management of the system, to upgrade worker’s technicalskills in line withwhat companies require, particularly SMEs and public corporations
in the run up to privatisation, and to reinforce existing functional links between
vocational training and other means of helping people on the labour market. In
Morocco, a similar project has now entered its operational phase, which involves
supplying equipment and technical assistance for training in fifteen sectors of theMoroccaneconomy.
Tunisia – Upgradingthe vocational-trainingsystem
The European Union has been supporting this measure, with a budget of €45 million, since
1998. This ambitious overhaul of Tunisia’s vocational-training system relies on interaction with
other measures designed to increase participation in the labour market. In 2001 the project
entered a new stage, which involves active restructuring of a large number of public and private
training establishments. This work is building on the results of the initial identification stage,
concerned with analysing the vocational-training needs and skills requirements of a broad and
representative range of businesses.
4.4.7.4. Localdevelopment and social funds
Co-operation projects aimed at promoting local development, through social funds
for example, are all concerned with finding lasting solutions to the problems of
unemployment and poverty. So far, the Commission has invested €200 million.
There are bilateral co-operation projects with Egypt, Jordan, Yemen and Lebanon.
These take a multi-sectoral approach and have the following objectives: (i) job
creation and the promotion of small businesses, essentially through microcredit; (ii)
construction of the economic and social infrastructure needed to deliver better social
conditions for the intended beneficiaries; and (iii) improvement in human and
institutional capacities.
These measures have gradually developed into an integrated local-development
approach, making it possible to carry out projects covering a limited geographical
area, such as the one in Algeria described below, in response to the real needs of
local communities.
4.4.7.5. Civilsociety
Support for civil society is a sensitive part of the Community’s co-operation policy,
as it is concerned with the internal balance within society. The goal is to encourage
governments to engage in a more intensive dialogue with all sections in society and
to involve civil society in the decision-making process. Accordingly, the Community
supports for the setting-up and consolidation of grass-roots associations, funds
democracy-building and local-development projects and gives backing to women’s
associations. In 2001, the Commission pushed ahead with the new approach,
launched in Morocco in 2000, implementing a project supporting development
associations in Algeria and negotiating a similar project in Tunisia .T h e r ea r ep l a n s
to extend the new approach to other countries in the region, including Egypt, Jordan
and Yemen. This approach, promoting better governance, consists of establishing an
openandongoingdialoguewiththoseconcerned.
120Socialdevelopment: Projects committed in 2001( €million)
Social development Country Project title Amount
Voc. training/ employment Algeria Vocationaltraining 60
Civil society Tunisia Strengthening of civil society 1.5
TOTAL 61.5
4.4.8. The European Initiativefor Democracy and Human Rights (EIDHR)
In 2001, the EIDHR gave almost €11 million in support of projects in the southern
MediterraneanandtheMiddleEast.
Of this total, €6 million went on promoting and defending Human Rights and
fundamental freedoms. The EIDHR supported two regional projects: regional
assistance to NGOs, the media and local government in Lebanon, Syria, Jordan and
Egypt ( €797 000); and the introduction of a masters degree in Human Rights and
democratisation in the Mediterranean region. The course, which is part of EU’s
regional masters programme in Human Rights and democratisation, will be taken by
3 6s t u d e n t sf r o mP a l e s t i n e ,L e b a n o n ,M a l t a ,L i b y a ,E g y p t ,A l g e r i a ,T u n i s i a ,
Morocco, Turkey, Cyprus, Jordan and Israel and will take a regional approach. The
Foundation for International Studies at the University of Malta is responsible for the
masters ( €640 000). Projects in a number of countries have also been approved: in
Lebanon, protection of migrant workers and asylum seekers’ Human Rights ( €
760 000); in Palestine, promotion of a culture of respect for Human Rights amongstschool-age children and adolescents in the occupied territories of Hebron, Ramallah,
B e t h l e h e ma n dJ e r u s a l e m(
€303 000); in Israel, the rights of prisoners ( €714 000),
in Palestine and Israel, training of human-rights activists ( €350 000); in Turkey,
raising awareness of Human Rights amongst DISK members ( €550 000) and
promotion of Human Rights and civic values amongst pupils and teachers at primary
and secondary-school level ( €376 000); in Tunisia, restructuring of the Tunisian
League for Human Rights ( €230 000) and in Iran, promotion of Human Rights and
abolitionofthe deathpenalty( €300 000).
The process of democratisation and strengthening of the rule of law received almost
€4.5 million in support, shared betweensevenprojects. Agrant worth €660 000 was
given to a project to support independent reporting and improve security for
journalists in the southern Mediterranean (Algeria, Egypt, Jordan, Lebanon, West
Bank and Gaza, Morocco and Tunisia). In Egypt, an €800 000 grant will help pay
for workto bring prison conditions up to a standard approaching international norms,
including 400 visits to prisoners a year and legal aid for prisoners. In Algeria, €
900 000 was allocated to a project aimed at upgrading standards in the prison systemto ensure better observance of Human Rights. In Morocco,
€550 000 was allocated
to a project to strengthen civil society in rural regions and involve people, especially
women, in local decision-making. In Syria, €513 000 was granted for measures to
promote citizens’ rights. In Yemen, €437 000 was allocated to training for the
internal-security forces in democratic policing methods that respect Human Rights
and individual liberties.
121In Jordan, there is a project which aims to increase the involvement of women in
decision-making, particularlyinParliament, bysupporting electioncandidatesof bothsexes and
all political parties. The project will focus on two objectives: to give students a better
understanding of women’s role in the democratic process and to encourage them to vote at the
next generalelection; andtogive womena betterchanceof successinthatelection.
Supporting conflict-prevention and the restoration of civil peace is one of the
EIDHR’s main objectives. In 2001, it gave over €300 000 in support for a project in
Palestine aimed at more effective enforcement of international humanitarian law in
the occupied territories of West Bank, Gaza et East Jerusalem.
4.4.9. Consistency with other Community policies
The need for consistency between the EU’s external activities and other Community
policies is an operational priority and a legal requirement. 2001 marked a decisive
stage in the process of strategic harmonisation: the Commission finalised and
approved all strategy documents for Meda partner countries, with the exception of
West Bank and the Gaza Strip, for 2002-04, priorto starting implementation.
The strategy papers for individual countries were based on a standard framework in
line with the guidelines laid down by the Council in November 2000. The process of
drawing up the strategy papers, in close co-operation with partner countries, the EU
Member States, the European Investment Bank (EIB) and international financial
institutions, focused attention on the task of ensuring that the measures
complemented each other as much as possible. Lastly, in a process quite separate
from the regular process of internal consultation, the projects were examined by the
recently formed quality-support group. The group examined each project to check
that it was coherent and that it complemented and was properly coordinated with
other planned measures.
4.4.10. Co-operation with other donors in the region
Better coordination with other donors and greater synergies with their work is a
strategicpriorityforimplementationoftheMedaprogramme. Realprogress has been
made in achieving these goals.
Coordinationonthe ground has been improved: representatives ofthe Member States
now cooperate with one another and there is regular joint monitoring of programmes
inthe partner countries to seethat theyare being properlyimplemented.
Coordination with other donors, particularly the World Bank and the International
Monetary Fund, has been further improved through regular contact, ongoing
exchanges of information and joint analyses of the political, economic and social
situation in the partner countries. The introduction of the third Structural Adjustment
Facility in Tunisia, undertaken jointly with the World Bank in 2001 and worth €
80 million, is a good example of how such coordination on the ground can work in
practice. Preparations are being made for similar joint operations in Morocco and
Jordan.
4.4.11. EIB loans
In 2001, total EIB loans to Mediterranean partner countries amounted to €1.5
billion, distributed between Algeria, Cyprus, Egypt, Malta, Morocco, Syria, Tunisia
122and Turkey. Most were bilateral loans. However, in 2001, the EIB did loan €6
million to a Middle-East technological investment fund, comprising all of the
Mediterranean partner countries. The EIB’s budget for the Mediterranean partner
countries for 2001-07 totals €7.4 billion, in the form of loans. A further €1 billion
has been allocated to regional co-operation projects in the telecommunications,
environment and energysectors.
In 2001, the Commission granted under the Meda Programme €8.5 million in
interest-rate subsidies for a new EIB loan. The loan comes under the programme for
the rehabilitation of the Taparura site in Tunisia, which will involve cleaning up and
generally improving 445 ha along the Sfax coast, which have been affected by
industrial pollution. In Turkey, interest-rate subsidies have also been granted on two
new EIB loans in Turkey. Of the €31 million total, subsidies amounting to €16.7
have been granted to the Industrial pollution abatement facility and €14.3 million to
the Mersin wastewater project. Both projects are concerned with rehabilitating areas
polluted byindustryand urbanisation.
The second priority area for the EIB is support for private companies, which,
irrespective ofsize and turnover, have received a quarter of the loans granted in 2001
bythe EIBto regionalprojectsinthe Mediterraneanregion.
Lastly, the third EIB priority is developing the energy sector, which received almost
a quarter ofthe loans granted last year.
EIB loans: Projects forwhich commitments were made in 2001 ( €million)
EIB loans Country Project title Interest-rate
subsidyLoan
EIB Tunisia Cleaning up ofTaparura 8.5 40
EIB Turkey* Industrialpollution 16.7 70
EIB Turkey* Clean water in Mersin 14.3 60
TOTAL 39.5 170
* The funds committed for Turkey under the Meda Programme (budget heading B7-4100) are directly
administered byDG Enlargement
4.4.12. ECHO
Recipients of humanitarian aid granted to the southern Mediterranean countries
through ECHO include: Sahrawi refugees in Algeria (emergency food aid and a
global plan worth €15.57 million in total); Palestinian Refugees in West Bank and
Gaza ( €26.18 million) but also southern Lebanon ( €2.7 million), Jordan ( €515 000)
and Syria ( €570 000).
123ECHO’s activities in2001
Country Project title Amount
( €million)
Algeria Sahrawirefugees 15.57
Algeria Back-up for theWorld Food Programme 11.80
Algeria Flood victims 0.77
Yemen Aid for people 1.88
Syria Vulnerablegroups 0.40
Palestine Palestinianrefugees 26.18
Lebanon Palestinian refugees 2.70
Jordan Palestinian refugees 0.51
Syria Palestinianrefugees 0.57
TOTAL 60.38
4.4.13. Monitoring
In 2000, the Commission devised a system for monitoring and improving results
based on project-cycle management. The system was operated in 2001 on a trial
basis in each geographical area (ALA/MED/ACP/Balkans). The system has already
produced some data giving useful knowledge about what stage the projects managed
by each geographical department have reached and what improvements need to be
made. The system will be extended to cover all the Co-operation Office’s activities
and will become fullyoperationalin 2002.
In 2001, 46 projects (including seven that were double-checked) were monitored in
six Mediterranean countries, with a combined value of €788.9 million. The projects
in the Meda countries accounting for the largest share of the budget were those
concerned with economic co-operation, institution building, civil society,
infrastructure and services (26%), followed by education and social sectors (25%).
The average score for projects in the Mediterranean area was 2.24 (compared with
2.5 for allgeographicalregions together).
The results reveal the poor effectiveness of projects in the Mediterranean region,
largelydue to shortcomings in the initial design and insufficient institution-building.
On the other hand, the Meda projects are noteworthy for their sustainability, unlike
projects inother regions. Sectoralanalysis ofthe projects showed that the best results
were obtained by projects concerned with agriculture and projects supporting NGOs,
while the worst results were obtained in the fields of industry and trade. Lack of
efficiency and impact were the critical flaws in the weakest projects. Size is also an
important factor: as a rule, small projects do better than bigger ones. The results
provide some very useful information but they are still quite raw and great care
should be taken when analysing them. The new monitoring system will make it
possible to analyse projects in all regions thoroughly and, on that basis, to draw up
goodguidelines for subsequent projects.
4.4.14. Conclusions and outlook forthefuture
Strategically speaking, 2001 constituted something of a break with the past for the
Mediterranean as a geopoliticalentity, and it demonstrated how unstable the balance
124was in the region. September 11, though not directly linked to Mediterranean
regional issues, nevertheless brought existing tensions concerning the
Israeli-Palestinian conflict to the surface, as the second Intifada – an armedstruggle
this time – entered its second year, also in September 2001. The worsening of
regional tensions illustrates the need for both sides of the Mediterranean basin to
nurture the ambitious partnership forged at Barcelona through to maturity. Today,
this seems the only global political project capable of delivering political stability
and economic and social development in a region stretching almost 5 000 km from
west to east and currently containing ten odd conflicts, some latent, some open. It is
against this background that full significance of the objectives spelled out at
Barcelona becomes apparent, i.e. to construct a framework for shared peace, security
and prosperity. The implementation in 2001 of the EU’s common strategy towards
the Mediterranean region, adopted the previous year, illustrates the importance the
Fifteen attach to process, which, more than ever, provides a much needed forum for
discussion. Moreworkneedstobedoneto makethis forummore credible inthe eyes
of the partner countries, with regard to the selection of priorities and the qualitative
results. Onthis front, the fifth conference ofEuro-Mediterranean foreign ministers to
be held in Valencia on 22 and 23 April 2002 should look back at the first five years
ofthe Barcelona progress (1995-2002) and adopt and Action Plan for the launch of a
series of practical joint measures covering the three sections of Euro-Mediterranean
co-operation.
The adoption of the new operational framework should lead in 2002 to a
strengthening and intensificationof measures concerning the following priorities:
•stronger dialogue on political matters and security, with the ultimate goal of
bringing workonthe Charter for Peace and Stabilityto fruition;
•creation of a dynamic and mutually advantageous financial and economic
partnership, including the signing of association agreements with Lebanon and
Algeria and more speedy negotiations with Syria. Priorities for 2002 are:
promotion of European direct investment in the region, consolidation of economic
dialogue, development of regional infrastructure strategies, planned launch of a
regional programme on internal-market instruments and creation of a Euro-
Mediterraneandevelopment bank;
•the setting up of a real dialogue between the civilisations, peoples and cultures on
both sides of the Mediterranean, reinforcing the existing social, cultural and
human partnership. An action plan will be adopted, based around three themes:
youth (launch of the second phase of the Euromed Youth Programme), education
(extension of the Tempus Programme to cover the Mediterranean partners) and
media and public opinion (launch of a regional programme on information and
communication). The plan will set out to promote the broadest possible
participation in the Euro-Mediterranean process around the core ideas of
democracy, culture and tolerance;
•support for the Middle-East peace process, with the EU stepping up its efforts to
rebuild the dialogue between the two sides and to stop the violence, as the prelude
to resuming negotiations for a fair solution to a conflict that undermines any
attempts at lasting co-operationbetweenthe various players inthe region.
1254.5. Africa, Caribbean and Pacific (ACP)
Sub-Saharan Africa faces the most difficult challenges in its fight against poverty. Progress
towards achieving the Millennium Development Goals has been modest in 2001 and negative
trendshave not beenconsistentlyreversed. More than three hundred million Africans still live
in absolute poverty. HIV/AIDS has emerged as the leading cause of death and is now a
fundamental threat to Africa’s future. Africa’s approach towards poverty reduction has been
reinforced through the New Partnership for Africa’s Development (NEPAD) concluded by
the African Heads of State in July 2001. Progress has also been made in restoring peace and
securityinsomeofthe mosttroubledregionssuchastheHornofAfrica, DRCandAngola.
The Cotonou Agreement concluded in June 2000 provides a new, sound basis for supporting
Africa as well as the Caribbean and Pacific countries in meeting their development
challenges. 2001 was the first year of its operation. Most country strategies for the coming
five years were drafted with wide consultation of society in country. In the context of
Cotonou, the political dialogue between Europe and the African, Caribbean and Pacific
countries has been intensified.
4.5.1. Introduction
The Cotonou Agreement, signed on 23 June 2000, sets out a new Partnership
Agreement with 77 African, Caribbean and Pacific countries until 2020. In order to
come into force, it must be ratified by at least two thirds of the ACP States, byallthe
EU Member States and be approved bythe European Community (article 93.2 of the
Cotonou Agreement). Thirty-six ACP States and four EU Member States have
alreadycompletedthis process.
In2001, the framework for co-operation with the ACP States therefore tookthe form
of transitional measures agreed by the ACP-EC Council of Ministers on 27 July
2000. These measures apply most of the provisions of the Cotonou Agreement, with
the exception of the release of the financial resources of the 9thEuropean
Development Fund.
The legal framework for relations with South Africa was extended in 2001 with the
conclusion of the negotiations for the Wine and Spirits Agreements, which were
finally adopted by the Council and signed in January 2002. The Trade Development
and Co-operation Agreement is still awaiting ratification. By the end of 2001 three
EU Member States had ratified. The Agreement applies provisionally and partially
from1 January2000.
The political dimension of EU relations with ACP countries has been strengthened.
An assessment of the political situation has been included in the Country Strategy
Papers. The political dialogue within countries has been developed and made more
systematic.
In 2001, the EC concluded consultation procedures based on Article 96 of the
Cotonou Agreement with the Ivory Coast and Fiji. In addition a Commission
proposal to review the Council decision closing consultations with Haiti was
126transmitted to the Council. The EC decided to open consultations under article 96
withZimbabweandunder article96and97withLiberia90.
Co-operation with Cuba continued in 2001 with funds going to emergency aid, co-
financing with Non-Governmental Organisations and support for economic co-
operation.
In 2001, the main priority has been to establish new improved Country Strategy
Papers following the new mechanisms provided for by the Cotonou Agreement. Co-
operation strategies are focused on povertyreduction and based on respect for social,
economic, political and Human Rights. The effectiveness of partnership should be
improved by the new approaches including a reinforced focus on good governance
issues, linking allocations to results and rationalising the mechanisms for the
disbursement of aid. Most importantly, recipient governments are to play an even
greater role in setting priorities and taking forward change on the basis of their own
policy agenda. Under the 9thEuropean Development Fund more emphasis will be
placed on the role of Commission Delegations and a further effort made to target
specific areas ofassistance inorder to maximise impact.
The new approach strengthens the principle of participatory development. It extends
the partnership to a range ofnonstate actors and takes a more integrated approach by
linkingpolitical, economic, social, culturalandenvironmentalaspects into a coherent
framework.
Commitments and Payments in 2001 in the ACP countries
€million Commitments Payments
Programmes 2001 2000 2001 2000
EDF: Bilateral (countries)
National Indicative Programmes1249 3324 1896 1351
EDF: RegionalCo-operation
Regional Indicative Programmes305 433 172 197
Bilateral/RegionalSub-Total 1554 3757 2068 1548
EC budgetlines 502 502 568 357
Total 2056 4259 2636 1905
Overview ofCommitments and Payments (EDF) 1995-2001
€million 1995199619971998199920002001 Total
1995-2001
Commitments 1 520 965 616 2 296 2 693 3 757 1 554 13 401
Payments 1 564 1 317 1 213 1 440 1 275 1 548 2 068 10 425
Ratio ofCommitmentsto
Payments0.97 0.73 0.51 1.59 2.11 2.43 0.75 1.29
90Consultations are opened under Articles 96 and 97 of the Cotonou Agreement in situations where essential
elements of the Agreement are breached (Article 96) or in cases of serious corruption (Article 97). The purpose is
to discuss the problems with the ACP partner country, and to find solutions. Options include agreed corrective
measures with phased implementation of EU aid and, in the absence of othersolutions,the suspension of aid.
1274.5.2. Regional Integrationand Co-operation
Regional integration and co-operation continued to play an important role in the
relations betweenthe EC and the ACP countries throughout 2001. Implementation of
the Regional Indicative Programmes (RIP) of the 8thEuropean Development Fund
(EDF), which were agreed for a five-year period in 1996-97 (concentrating primarily
on transport, agricultural research, conservation of natural resources and regional
economic integration91) remained the principal activity. €304,923,133 was
committed in 2001 covering all sectors for the regions’ and ‘all ACP countries’’
programmes. Work on the programming process of the 9thEDF also started. Initial
allocations for regional co-operation were: €700 million for Regional Indicative
Programmes, €300 million for intra-ACP programmes and €300 million in reserve.
During the review process the reserve may be used to provide additional support
linked to bothperformance and needs.
Regional integration and institutional support are key elements of EC support since
these are essentialfor the better integration ofACP countries into boththeir regional
economy and the global economy. Major programmes of technical assistance in
trade, customs, statistical and other areas with the Common Market for East and
Southern Africa, Economic and Monetary Union for West Africa and the Forum of
Caribbean States, continued over the course of 2001. Three new programmes
totalling €13.2 million were approved for the five Portuguese speaking countries
covering legal systems, statistics and administration at all levels. These will be
implemented in co-operation with the Portuguese Government, which is contributing
financial and technical support. Political initiatives were also taken at a regional
level, such as contributing to the inter-Congolese dialogue ( €1.96 million) and to the
peace-keeping and conflict prevention activities of the Economic Community of
West AfricanStates.
The intra-regional dimension has remained important in 2001 with programmes
launched, for example, to prepare the ACP countries for the Economic Partnership
Agreements ( €20 million) and to enable them to participate more effectively in the
World Trade Organisation negotiations ( €10 million). In this context, the EC also
contributed €1.45 million towards the establishing of an ACP Delegation to the
various international bodies based in Geneva (WTO, UN Conference for Trade and
Development etc.), opened in January 2002 by Commissioner Lamy. Following the
Cairo EU-Africa summit, contacts with pan-African organisations capable of taking
forward specific actions have been intensified.
91(e.g.promotingeconomiccommunities,customsunionsandfreetradeareas)
128RegionalCo-operation Commitments (EDF) in 2001
Region (EDF Regional Indicative Programme) €million92
Caribbean 4.14
CentralAfrica 8.25
EastAfrica 3.64
Indian Ocean - 0.76
Pacific 29.8
Southern Africa - 0.43
West Africa 63.02
PALOP (Portuguesespeakingcountries) 8.6
Overseas Countries andTerritories 5.71
Sub – Total 121.97
All ACP 182.95
Total 304.92
4.5.3. Overseas countries and territories
Member States’ ‘overseas countries and territories’ have been associated with the EC
since its inception in 1957. The purpose of this association, according to Article 182
ofthe Treatyestablishing the EuropeanCommunity, is ‘to promotethe economic and
social development of the countries and territories and to establish close economic
relations between them and the Community as a whole.’ There are 20 Overseas
Countries and Territories (OCTs) scattered around the globe. Relations between the
OCTs and the Community are governed by Decisions of the Council of Ministers.
The most recent Council Decision of 27 November 2001 breaks new ground by
providing for greater partnership inthe mangement of financialresources accorded to
the OCTs. The new procedures are based on those in force for the Structural Funds.
Under the 9th EDF €175 million has been earmarked for the OCTs, of which €
145 million in programmable aid for the long-term development of 12 OCTs, €
8 million for regional co-operation, €20 million for the investment facility and €
2 million for studies and technical assistance. The OCTs may also receive fundingfromthe generalbudget under budget lines forthe developing countries.
Under the three previous Funds mobilisation of the financial aid available (contracts
and payments) was slow (especially in the case of the Dutch OCTs). Ninth EDF
procedures should facilitate mobilisation and disbursement. Of the some
€
268 million made available under the three previous Funds (excluding regional co-operation), 82.5%has beencommitted and 73.5% disbursed.
Of the
€30 million for regional co-operation, 82% has been committed, largely
thanks to excellent OCT-ACP co-operation in the Pacific, which gave rise to a
number ofcofinanced operations under the 8thEDF(fisheries and agriculture).
4.5.4. Transport and infrastructure
This sector covers transport, water and sanitation, mining, energy and also support
for information technologies and telecommunications. Support for the transport
sector is recognised as a key element in reducing global poverty, and in promoting
sustainable development and enhanced integration of ACP countries. Improving
92Negative figures occur when ‘decommitments’ (i.e. the freeing up of committed moneys from non-executed
projectsfromprevious years)outweigh commitments
129access to basic services is also essential for the enhancement of the quality of life for
alland, inparticular, the poorest.
4.5.4.1. Transport
Out of the 660 programmes/projects currently under execution within this global
sector, the EC is currently supporting implementation of 87 major projects (more
than €5 million) in the transport sector focusing on sectoral reforms, capacity
building, maintenance and upgrading, and regional integration. This reflects existing
deficits inreliable transport services particularlyin Africa.
The year 2001 has been characterised by a substantial acceleration of the
implementation of existing programmes in this area, particularly in countries that
suffered implementation delays at an earlier stage of the programming cycle. New
contracts amounting to a total of €414 million have been concluded in the transport
and infrastructure sectors. A handful of countries (Benin, Ethiopia, Guinea Conakry
and Mali) share, between them, roughly 50 % of this allocation. Mali ranks first in
this group with €73 million in new secondary commitments, followed by Benin ( €
56 million), Guinea Conakry( €44 million) and Ethiopia ( €41 million). In Mali, new
contracts cover the upgrading of 437 km of the main road link to Senegal. This
project also opens up access to one of the poorest regions of the country. In Benin,new contracts cover the periodic maintenance over two years of 490 km of principal
roads (roughly25% of the country priority network) and the upgrading of 102 km in
the north of the country. In Guinea Conakry, activities covered bythe 2001 contracts
focus on the upgrading and improvement of the interregional connection with
Senegal, where the nearest harbour is located, facilitating better international
integration of the country in the medium term. In Ethiopia, the upgrading of the 514
km Addis Ababa – Woldiya road, crossing a region with a population exceeding 2
million, is a major component of the government’s Road Sector Development
Programme and will substantially improve road access between the capital city and
the northofthe country. At regional level, the close of2001 also saw the signature of
contracts for two major road links for a cumulative value of €165 million. One of
these links willallow better international integration of Chad via Cameroon (400 km
link Moundou –Touboro-N’Gaoundéré) and thereby substantially contribute to the
economic integration of the Central Africa region. The other contract covers the 130
km link between Kankan (Guinea Conakry) and Bamako (Mali). Due to its current
condition this road limits the development opportunities of the north west of Guinea
Conakryand the SouthWest ofMali. These regions, withan estimated population of
one million, are currently cut off from the rest of the country for several months a
year.
With regards to programming of the 9thEDF, 23 of the 44 ACP Country Strategy
Papers presented for consideration in 2001 included transport as a priority sector.
Almost all of these 23 countries were in Africa. It is expected that by the end of the
programming exercise, approximately 30 ACP countries and 3 regions will have
adopted transport as one of their prioritysectors, involving the probable allocation of
approximately €2 billion. This is a similar amount to that allocated under the 8th
EDF, in recognition of the continuing high priority given to the sector by partner
countries, particularly in Africa, and the Commission's recognised expertise in this
field.
130Transport – Commitments 2001
ACP Country Project Title €million
Aruba Preparatorystudyfor designing National Park 0.5
Belize Construction of new bridgeover Sibun river 2
Road Doba Sahr technical studyandtender preparation 0.74 Chad
Technical/institutionalsupporttoMinistryofPublicWorks,
Transport, Housing and Urbanism1.90
Technical assistance: implementation of national transport plan 1.95 Congo
(Brazzaville) Upgrading ofruralroads 1.98
Eritrea Strengthening of theTransport Ministry 0.62
Pre-feasibilitystudy: Gondar-Huemra&Arba Minch road 0.74 Ethiopia
UpgradingoftheHararJigaroad 0.71
Fiji NewRewa Bridge 11
Gabon Increase of funds for the Larara/Mitzicroad project 1.99
GuineaBissau JoaoLandimBridge–Increasedfunds 2.65
Guinea Conakry Environmentalimpact study 0.2
Kenya Northern Corridor upgradingprogramme 79.5
Madagascar Programmefor roadmaintenance&improvementofaccess 42
Malawi Lakeshoreroadinfrastructuresupport 13.72
Technical Assistance to theMinistryof Public Works 0.55 Mauritania
Technical Assistance: maintenance of roads 0.75
Road Hienghene Pouebo 5.6 NewCaledonia
FishingSupport 2.8
Niger Technical Assistance: Transport 0.75
Salomon Increaseoffundsfor theMalaitaruralinfrastructure 1.2
SaoTome Supporttothenationalroad service 0.48
Surinam Construction ofroadtotheferryterminalSuriname-Guyana 13.2
Tanzania Backlog maintenance programme for the central corridor 22
Uganda Strengtheningofnorthern corridorroad 36.6
Wallis&Futuna Publicworksequipment 1.93
Action Plan for regional transport development 1.98 Regional:
CentralAfrica Barouaboulai-MeigangaNgaoundereRoad: feasibilitystudy 1.9
Backlog maintenance programme for the central corridor 20 Regional:
EastAfrica Northern corridor upgrading programme 13.6
Regional:
West AfricaUpgrading Kayes-Kidiraroad 28.99
Total 314.53
4.5.4.2. Water and sanitation
The focus of EC support in the provision of water and sanitation has progressively
evolved from a project approach focusing on water supply and addressing mainly
technical issues, into a programme approach, featuring stronger social and
environmentalconcerns, and support for improved management ofthe resource. €52
million was committed in 2001 to activities related to safer water supply and the
improvement ofsewerage and sanitationservices inurbanareas.
The EC is currently supporting government policy in improving water supply and
sanitationaccess insmalltowns in ruralareas in five countries. In Ghana, 30% of the
€32 million allocated to the National Community Water and Sanitation Strategy has
131been executed to date as planned. It is expected that at the end of this project more
than560,000 people will have access to safe water and to basic sanitationservices.
In Mozambique, the EC is directly supporting integrated water resourcesmanagement in the Zambesi basin, the second largest water-catchment area in the
Southern African Development Community Region, in order to improve the quality
of life of the population, especially in rural areas. The EC contribution of
€11,7
million should permit the establishment of the Zambesi Catchment Management
Authority and the development of rural water supply and sanitation
planning/promotion capacity in the basin. The technical assistance for the project
implementation was recruited in 2001. In Uganda, the ‘mid-western towns water
supply’ programme also started in 2001. This €17.5 million programme will benefit
an estimated population of 100,000 by reducing the incidence of water-borne
diseases. In Samoa, a €18,7 million rural water supply programme is currently
coming to an end. This programme is achieving its objective to improve the existing
water supply system in the most populated rural areas of each of Samoa’s two main
islands, thereby benefiting about half of the whole rural population i.e. some 55,000
Samoans. In Mauritius, the implementation of the €16,7 million programme for the
St Martin sewerage treatment plant expansion - serving a population of 220,000 - is
on schedule. In Ethiopia, 30% of the €19.5 million allocated to address the
inadequate water supply and the poor sanitation situation among low income
households has also been implemented as planned.
Transport and Infrastructure (Waterand sanitation)–Commitments 2001
ACP Country Project Title €million
Angola Drinking water supplyfor thecityofTombwa 7.6
Antilles(Dutch) Sewagesystem: Bonaire 0.5
Ethiopia Addis Ababa water supplyproject 6
Fiji Environmentprogramme 8.5
Ghana Smalltownswater supply&sanitationinnorthernregion 1.99
Lesotho Lesotholowlandswater supply: feasibilitystudy 1.75
West coast seweragestudy 0.15 Mauritius
Technical Assistance to sewerage sector 0.11
Nigeria Smalltownswater supplyand sanitation programme 15
Polynesia (French) Improving of the sanitation of Bora Bora 9.95
Salomon Islands Addition toKombitowater supplyproject 0.15
Total 51.70
4.5.4.3. Mining sector
During 2001, EDF mining support programmes were underway in thirteen countries
with a total financing of €452 million. Eight of these countries (Botswana, Burkina
Faso, Dominican Republic, Gabon, Mali, Mauritania, Namibia and New Caledonia)
are being supported in their efforts towards sustainable development of their mining
sector. In some of these countries institutional support and appropriate basic
geological information has been improved, in others efforts have focused on the
recovery of main public or private companies and ways of reducing the negative
impact of mining activities. In the other five countries diversification programmes
are under waymainly focused onthe transport sector.
132Since 1stJanuary 2001, following the decisions on the transitional measures between
Lomé and Cotonou, uncommitted funds allocated to support traditional industries93
(around €450 million) are being programmed in the framework of the Cotonou
Agreement. Priority is given to mineral sector institutional strengthening
programmes (which may include a wide spectrum of projects, such as revision of
mining and/or environmental codes, development of geological infrastructure,
dissemination and communication activities and training), support to small and
medium-sized mining enterprises and environmental protection. In 2001, nine
appraisalstudies were under implementation.
The EC was also active in ACP countries through specific programmes in other
fields such as energy and information technologies and telecommunications’
systems, inresponse to the specific regionalor local situation.
In the energy sector, different activities covering institutional strengthening, power
supply support - including rural electrification and renewable energy - and transport
are underway in the Dominican Republic, Eritrea, Ethiopia, Ghana, Kiribati, Mali,
Mauritania, Senegal and Sierra Leone. In 2001, efforts have been initiated to
mainstream energy, in order that links between energy and development priorities
(health, education, enterprise development, gender etc) are recognised in the
implementationofthe9thEDF.
Efforts are also being made to provide improved information and telecommunication
systems. In the Caribbean region, a €750,000 project to ensure a regulated and
integrated development of the telecommunication has been launched as well as a €
3.5 million project supporting the modernisation ofexisting broadcasting. In Africa -within the
€11 million Meteorological Transition programme - the tender for
replacing equipment for all Meteorological Services in 47 countries was launched in
November 2001. When completed, these regional interventions will improve the
access ofACP countries to basic reliable information for sustainable development.
93SYSMIN: System for Safeguarding and Developing Mineral Production. This is the ‘SYSMIN transfer’ from the
8thEDF destined to finance the development programme identified following a request for aid under the Sysmin
programme of the Lomé Convention but for which no financing decision could be taken before 31 December 2000
133Benin- Support tothe transport sector
In October 1993 the Benin Government adopted a transport development strategy. This
strategy included limiting investment to a priority network, setting up a road fund to ensure
that maintenance could be financed, orienting the role of the state towards policy making and
regulation, facilitating private sector participation, supporting the development of transport
servicesandestablishing aninvestment programme.
In the past, €165 million from various European Development Funds have been granted in
support of this strategy mainly for construction and upgrading of 1114 km of priority roads,
thereby enabling Benin to strengthen its role as a transit route to neighbouring countries.
Community support has also focused on institutional aspects, especially the setting up of the
Road Fund. In 2001, the main activity has been the starting of renovation programmes for 600
km of priority roads in the north of the country at a cost of some €90 million. The other
objective of Community aid is to open up the poorest regions by linking them to the priority
network. In addition, EC aid in the transport sector takes into account the problem of the
marginalisation of an ever increasing part of the urban population. Thus, the improvement of
access and traffic within certain areas of Cotonou and Porto Novo is being carried out using
labour intensive methods in order to provide income to some of the poorest people. This last
project created anestimated 5000 or more jobs over 4 yearsbenefiting over 30,000 people when
workers’dependants are takenintoaccount.
It is estimated that the total portion of the priority road network classified as ‘poor’ reduced
from40% in1998to10%in 2000.
Transport and Infrastructure – Otherinfrastructures - Commitments 2001
ACP Country Project Title €
million
Barbados Expansion oftheBarbados languagecentre 3.95
Studyfor theuseofsubstitutematerialsfor sand 0.10 Comoros
Management ofsolid waste 1.83
Dominican Republic Pilot project - solid wasteinmarginaldistricts 0.84
Ethiopia Preservation and conservation of the Lalibela churches 9.10
Haiti Increased funds for satelliteimageryproject 0.35
Kiribati Kiribati training programme(infrastructures) 6.40
Montserrat Design andsupervision ofthecommunitycollege 0.15
Namibia Upgrading maritime & fisheriesinstituteat Walvis 1.90
New aquarium for Nouméa 0.90 NewCaledonia
Cold store of Nouméa 1,00
Saint Vincent Learning resources centre 1.50
Tonga Vava’u developmentprogramme(infrastructurefor
fisheries, agricultureand tourism development)5.20
Regional: Caribbean Caribbean radar network project 0.20
Fiji school ofmedicineresourcedevelopment 7.50 Regional: Pacific
Reducing vulnerabilityofPacificACP states 7,00
Total 47.92
4.5.5. Sustainable Rural Development and Food Security
Three quarters of the 1.2 billion people living in extreme poverty live in rural areas,
and are frequently affected by severe environmental problems. As a result,
sustainable rural development and natural resources management - the basis for
economic growth in most developing countries – are priorities in the work towards
the reduction of rural poverty. Although substantial amounts of resources being
programmed for the social and infrastructure sectors will go to rural areas, the
Commission has not yet fully succeeded in systematically adopting a strategic
approachtoruraldevelopment.
1344.5.5.1. AgriculturalDevelopment
The major changes in the international(liberalisation and globalisation of markets at
the regional and global level) and national (i.e. less central control of productive
sectors) environments necessitate change in the implementation of projects and
programmes. The new programmes within a Sector Wide Approach (SWAP)
framework support national agricultural sector policies in order to strengthen
agricultural producers’ organisations, to encourage the participation of the private
sector and facilitate access to financialservices (microfinance and other credit).
In Burkina Faso the ongoing PAOSA (Plan d’Action pour l’Organisation du Secteur
Agricole) programme for €24,2 million is providing support - within the framework
of the Agricultural Structural Adjustment Programme funded by the World Bank -
for capacity building in the existing agricultural professional organisations. It also
offers access to local finance, institutional support and improvements to the
productivityofthe rice industry. It plans to train 30,000 farmers and 50,000 families,
offer small credit facilities to around 500,000 people and establish new rice schemes
(covering 4000 hectares) aiming to increase average annual production by 10%.
However, co-operation in the agricultural sector is still very much project based andthere has been insufficient progress in increasing EC participation in multi-donor
initiatives. With regard to STABEX, and future support in circumstances of short
term fluctuations in export receipts provided for under the Cotonou Agreement, the
new programmes will not only contribute to institutional reform but also to
macroeconomic stability.
During 2001, the Commission continued its support for the 12 traditional ACP
suppliers of bananas through special technical and financial assistance
94.T e n
financing proposals were approved for a total amount of €43 million.
Implementationofthe two previous years’agreements also continued with support to
improve productivity (irrigation and drainage), quality (cold storage) and marketing
and to encourage diversification in countries where banana production is not
sustainable.
94asspecifiedin CouncilRegulation 856/1999
135Agricultural ResearchSupport inKENYA
The Agriculture/Livestock Research Support Programme (ARSP), Phase II, is a five year
support programme for €8.3 million to the Kenyan National Agricultural Research Project
which started in 1998. The overall goal of the ARSP, is to enhance the economic integration of
rural communities particularly in Arid and Semi-Arid Lands (ASAL) with the rest of the
country’s economy. The initiative aims at ensuring that the private & public sector field
workers engaged in ASAL, as well as community based organisations, make more effective use
of research recommendations in order to offer cattle and other farmers sound and socially
acceptable technologies and concepts. EU contributions (as well as other donors) take the form
of operational funds for research and capacity building, improved infrastructure, scientific as
well as transport equipment and short and long term technical advisory services. This has
produced a larger andmore efficient agricultural research capacity, particularly in the Kenyan
ASAL.
Adaptive and applied research programmes focus on soil and water management, livestock and
natural resource management topics in the mostly arid rangelands. The project is aimed at
providing sustainable solutions using a community based and gender sensitive approach, with
strong collaboration of NGOs and government field workers. Collaborative agreements with
community based organisations and NGOs on the promotion of recommended technologies and
facilitation / training during their introduction enhance adaptation and adoption on a wider
scale. This has for example led to the establishment of three small scale dairy units at strategic
centres in the northern Kenyan rangelands supplying about 50,000 people with hygienic fresh
and processed cow and camel milk products. At the same time food security and sustainable
incomes (particularly for women) have increased for these ASAL communities. With improved
tillage and drainage technology about 2.4 million hectares of poorly drained heavy soils
(vertisols) can now be used for timely agricultural production. An early planting tool was
simultaneously developed to increase farmers’ chances of a healthy crop in the semi-arid areas.
The projecthasbeenabletoraiseawarenessamong the pastoral and semi-pastoral communities
of Kenya about the strategic importance of preserving Kenya’s animal genetic resources, which
are highly adapted to the harsh conditions and disease pressure, notably the approximately 5
millionEast AfricanShorthornZebucattle.
4.5.5.2. Livestock Development
Two new financing agreements for atotalamount of €12,5 million were approved to
support the livestock sector in Madagascar and Guinea in 2001. The projects will
focus on institutionalsupport, animal health, privatisation of the veterinarian services
and improvement of the animal production commodity services. It is hoped that the
sustainability and efficiency of these projects will be substantially enhanced both by
the active involvement of the beneficiary small livestock holders in the project
design and by the strengthening of the livestock farmers’ organisations who are
responsible forimplementation.
At regionallevel,twoprogrammesare implementedthroughthe InternationalBureau
for AnimalResources based inNairobi:
•The ‘Farming in Tsetse Controlled Areas’ project ( €20 million) which started
with Ethiopia, Kenya and Uganda, but which will be extended to Tanzania,
Rwanda and Burundi. The project aims to improve the well being of the rural
populationthrough sustainable livestock development in tsetse affected areas. The
long-termaimis sustainable tsetse controlorganised and financed by the livestock
owners. In Kenya, for example, an emergency intervention reduced the rate of
infectionoftrypanosomosis from80%to 20%ofthe 50 000 cattle in Teso district.
1 400 farmers have been trained in tsetse control techniques. A new approach to
manage tsetse-transmitted trypanosomosis has been tested in 60 units. Their
136protection with insecticide-impregnated mosquito nets has led to a significant
reductionofcosts for veterinaryinputs and an increase in milk production.
•The Pan African Control of Animal Diseases (Epizootics) programme ( €72
million) covers 32 sub Saharan African countries. 28 countries had an active
nationalproject in2001. Close coordination betweenthe beneficiary countries, the
donor community and other international organisations (International Livestock
Research Institute, International Epizootics Office (OIE), UN Food and
Agriculture Organisation) has been established in order to set up a global animal
health system. The project aims at a re-organisation of the veterinary services
enabling them a better control of major animal diseases. This control, if
internationally recognised, is a precondition for the countries to participate in the
regional and international trade of livestock and animal products. Ten countries
have, for instance, prepared their dossiers to be submitted to the OIE to obtain
‘rinderpest disease free’ status.
4.5.5.3. Research
Agriculture research is contributing to the alleviation of hunger and rural poverty by
improving rural productivity and increasing agricultural incomes. With the growing
scarcity of land and water, future increases in food supplies have to come from
increased productivity. Two major programmes (involving the West and Central
African Council for AgriculturalResearch and Development and the Association for
AgriculturalResearch inCentralAfrica) amount to €41,3 million. These started their
activities in 2001 with the overall objective of improving the agricultural research
capacityand services of more than 20 national agriculture research institutions in the
three regions concerned. These programmes are characterised by capacity building of
nationaland regionalresearch institutions, an innovative approach of accessing funds
by competitive bidding and co-funding of regional research networks on specific
agriculturalproducts.
4.5.5.4. RuralWater Supply
The international community has adopted an international development target for the
increase of access (for the population of sub-Saharan Africa) to an improved water
source, from49% to 74%, by 201595. One ofthe EC’s most important projects is the
‘Programme Regional Solaire’, where 626 solar pumps and 660 solar electrification
systems have been installed between 1990 and 1998 in Burkina Faso, Mali, Niger,
Senegal, Gambia, Chad, Mauritania, Cape Verte and Guinea Bissau for the benefit of
one million rural people. After a positive evaluation in 2001 it has been decided to
launch a phase two for €60 million. The second phase aims to establish a long-term
improvement to the availability of drinking quality water for the rural populations of
the Sahel. 465 new solar systems will be established in rural villages (with an
average population of over 3,000). This will involve the active participation of the
beneficiaries and the private and public sectors in exploiting available resources
using solar based technology.
95Millennium Development Goals
137Fisheries
A number of projects - in particular those in the Pacific (ProcFish), Indian Ocean
(Monitoring Control and Surveillance) and Lake Victoria (Fisheries Implementation
Plan) were launched to build aquatic resource management competence in target
ACP countries and to facilitate regional collaboration. Two new important national
projects on rural coastal fisheries also started in the Pacific promoting private sector
involvement. In co-operation with the Support Unit for International Fisheries and
Aquatic Researchofthe UN’s Foodand Agriculture Organisation, a number ofother
fisheries management projects are in preparation. To ensure improvements in
production and trading capacity in relation to fishery products, a €45 million
programme onthe strengthening ofsanitarycontrolaspects was also financed.
Lake Victoria FisheriesResearchProject
The fisheries of Lake Victoria have an annual production of 500,000 tons of fish, of which
100,000 tons are exported to western markets. They play an important role in the economic
development of the East African region. The second phase of the Lake Victoria FisheriesResearch project (started in 1995 with
€9.4 million) has fostered regional co-operation
between Kenya, Uganda and Tanzania through the Lake Victoria Fisheries Organisation. Theupgrading of facilities and vessels, the training of 150 research staff and the provision of 12long-term overseas scholarships have all enhanced the research capacity of the three localresearch institutions. The project hashelpedimprove the sustainable management of the lake’sresources, and a Joint Fisheries Management Plan (currently under discussion forimplementation by the countries concerned) hasbeenestablished.
Pacific FisheriesProgramme
The Pacific Regional Oceanic and Coastal Fisheries Programme (PROCFISH, €10.5 million)
comprisestwocomponents:
•The coastal component involves compiling results from the first major baseline assessment
of reef resources covering most of the Pacific area. It stresses reef resources per se as well ashuman and social aspects.
•The oceanic component will exploit the results of research and assessment work already
carried out by the Secretariat of the Pacific Community (SPC) on the major Pacific tunaspecies.Thiswork,whichhasreceivedrecognitionfromthe international scientificcommunity,was performed by the SPC as part of the previous South Pacific Regional Tuna Research andAssessment Project alsofundedfromEDFresources.Thescope of the work will be extended toinclude more thorough assessment and monitoring of bigeye, yellowfin and by-catch stocks intheregion.
Each of the two PROCFISH components includes an ‘ACP’ component and an ‘OCT’
component for Overseas Countries and Territories. The SPC is the executing agency for this
regional project
96.
4.5.5.5. Environment
Work on the environmental field has been very intensive in 2001, particularly in the
fields of forestry, conservation, wildlife, and sustainable management of natural
resources. Seven new programmes/projects have been implemented amounting to €
55.1 million, and four new programmes have beenapproved totalling €26 million.
96see:http://www.spc.int
138The major ongoing programme in this sector is ECOFAC, a regional programme for
the conservation and rational use of Central African Forest Ecosystems. A third
phase started in 2000 for €23 million with activities related to the conservation of
biodiversity, the sustainable use of the natural resources such as forests for
sustainable development and sustainable improvements in people’s standard of
living. Programme activities, co-ordinated by a recently strengthened environmental
unit based in Libreville, are taking place in 6 countries of the Congo forestry basin.
The programme has managed to substantially improve the capacity and the
awareness of the nationalauthorities in the management of their naturalresources. In
2001 the size of the Odzala National Park (Congo Brazzaville) has been increased
from2 800 km² to 13 280 km² i.e. by a multiple offive and the Monte Alen National
Park (Equatorial Guinea) has been extended from 1 004 km² to 2000 km².
Furthermore, a Network of Protected Area of Central Africa (RAPAC) has been
established. The willingness of the five world heritage sites in the Democratic
Republic of Congo to join the network and the new membership of the Zakouma
National Park in Chad show the positive reception being given to RAPAC. Another
important activity is the dialogue with logging companies to improve management
plans and to involve local communities both in the control of the illegal bush meat
tradeand inthe establishment ofcommunalforest plots.
Villagewater supply inChad
Access to drinking quality water is a crucial issue in Chad. Nearly eight inhabitants out of ten
do not have access to clean water and some 33% of the villages (with a population of more than
300 people) do not have a water supply point. Experts estimate that the villages need 15.000
boreholes equipped with hand pumps, and that the nomadic population requires at least 4.000
large wells. A sectoral policy on water has been established in co-operation with other donors.
Since the 1980s, the European Union has allocated over €30 million to this sector. This has
permitted the construction of about 2000 water points equipped with pumps, and in addition,
the construction of 45 drinkingquality water distribution systems in the main villages, as well as
the repair of approximately one hundred water points. The area covered has been increased
around the capital, Ndjamena, to include six regions in the west of the country. A programme to
provide more than 1000 new water access points is currently being implemented. Each day,
water is available from new wells. In tandem, the regional solar programme has installed auto-
functioning solar pumps in Chad, which have the added advantage of requiring little
maintenance. A new programme, co-financed with the German and the French development
agencies, will provide - in the near future - access to about 300 new outlets. A study has started
toplan the activities inthispriority sector under the 9thEDF, including the construction of some
3400 new wells. All activities seek toensure sustainability and maximise co-operation with other
donors.
4.5.5.6. FoodSecurity
The EC is active in the food security via its emergency humanitarian aid office,
ECHO and through its overall development assistance strategy. Some examples of
activities in ACP countries inthis sector aregivenbelow.
Africa –Mozambique
Almost two thirds of the population of Mozambique (of which 80% is rural) live below the
poverty line andencounter serious problems of food insecurity aggravated by recurrent natural
disasters e.g. cyclones, floods or droughts. Community food security programmes come within
the framework of the Poverty Reduction Strategy Paper which supports the public service
reforms judged essential for food security. This strategy is supplemented by direct support to
agricultural producers. Support for administrative reform is carried out via budgetary
assistance targeted at the Ministries of Agriculture (via the PROAGRI programme) and
Commerce as well as the National Meteorological Institute. Direct support to rural produ cers
aims to improve productivity and agricultural diversification, focussing on the north and the
south of the country.
139Caribbean–Haiti
In Haiti the local population only receives 80% of the nutritional minimum requirements set by
the UN and significant environmental damage contributes to a permanent state of food
insecurity. The political instability affecting the country has worsened since the government
elections of May 2000 and this in turn has led to a significant slowdown in international aid.
Despite the freezing of new commitments through the EDF, the European Commission has
continued its assistance to school canteens, ensuring a balanced diet for almost 115 000
schoolchildren. Activities already approved or underway (e.g. renovation of infrastructure,
creditassistance) have alsobeen continued.
RuralDevelopment and Food Security: Commitments in 2001
ACP Country Project Title €million
Benin Programmefor therepair andmaintenanceofminorroads 8.50
Botswana Wildlife conservation &management programme 14.00
Burkina Faso Solar Regional Programme phase II 9.96
Cameroon Institutional support for decentralised road maintenance 23.50
Cayman Islands Naturetourism development 0.10
Chad Solar RegionalProgrammephaseII 4.00
Dominican
RepublicDominican eco-tourismdevelopmentprogramme 5.99
Ethiopia Coffeeimprovementprogramme(CIP IV) 15.00
Improvement of tourism management in la Lopé reserve 0.10 Gabon
Technical assistance for forestryand environment 0.08
Guinea Bissau Feasibilitystudyfor theSolar RegionalProgramme 0.08
Guinea Conakry Supportfor thepromotion ofrural organisations 18.50
Madagascar Livestock development programme 4.00
Evaluation ofthesocial forestryproject 0.06 Malawi
Technical assistance to programme preparation Natural
Resources sector0.35
RiceProgramme 16.00
Solar RegionalProgrammephaseII 6.56Mali
Environmentalprogrammeagainst desertification 14.00
Adrar Rural Oasis 10.00
Seminar on agricultural diversification 0.02Mauritania
Study for therehabilitation of the PPG dam 0.08
Ruralinfrastructureneedsinpoorruralareas 0.08
Rural development 0.20
Supporttoagriculturalmarketing &tradenegotiations 0.19Namibia
Nationalagriculturalservices supportprogramme 6.00
Niger Solar RegionalProgrammephaseII 2.39
Togo Agro-forestryprogramme 1.98
Uganda Forestresourcesandmanagementprogramme 12.00
Zambia Forestrysupportprogramme 1.90
Zimbabwe SexuallyTransmitted Diseasescontrol 0.04
Regional: Central
AfricaAnti– poachinginitiative 1.60
Assistance to plant protection in thepacific 0.03 Regional: Pacific
Pacific and regional oceanic and coastal fisheries 10.50
Solar RegionalProgrammephaseII 26.21 Regional:
West Africa Energyregional programme 5.40
All ACP Technical centre for development of agriculture 13.31
Total 232.71
4.5.6. Human Rights, Democracy, Good Governance and Capacity Building
Respect for Human Rights - including fundamental social rights, democratic
principles, the rule of law and accountable governance - form an integral part of
140sustainable development and are fundamental elements of the Cotonou Agreement.
These issues are the subject ofregular political dialogue between EU and ACP States
and are areas for strong Community support. ‘Institution building’ is one very useful
path in this direction. The Commission Communication on Conflict Prevention97
calls for more activity relating to peace, democracy, political and social stabilitybeing integrated into assistance programmes as a means of conflict prevention. This
is therefore an area where EC activities are increasing all the time, in particular,
through the relatively new field of institutional support through experience gained
fromprojectsandcontactswithotherdonors.
Intotal, there were 254 new and ongoing projects in this field in 2001 totalling
€727
million. They covered a wide range of ‘institution building’ activities and can be
divided into two broad categories: (1) respect for Human Rights, improvement of
legal systems, elections and civic education; (2) good governance through capacity
building, civil service reform and decentralisation. In addition there was a total of €
121.5 million of projects covering all aspects of institution building in South Africa.Given the nature of these activities, any assessment of success of these programmes
willhave to be made inthe mediumto long term.
4.5.6.1. HumanRights and Justice
The EC’s Human Rights’ programmes aim at bringing about and maintaining peace,
e.g. the
€800,000 allocated from the rehabilitation programme for Burundi to
promote national reconciliation through training the ‘bashingantahe’ (village elders)
as para-legals and sending themto “collines” (districts) throughout the country where
they are under-represented. The United Nations Development Programme is
managing this programme. In Equatorial Guinea, a new pilot programme for €3
million to support Human Rights, democracy and the rule of law is about to start
after severalyears ofsuspensionofdevelopment aid.
A properly functioning system of justice is fundamental to the respect for Human
Rights. There are currently EDF financed programmes in eight countries totalling €
48.4 million specifically targeting this area, e.g. a €16 million programme in
Burkina Faso in support of democracy, law and good governance. This project
focuses inparticular onlegalreformworking through the University ofOugadougou,
and directly links democratic government with sustainable social and economic
government. It also has a prison reform component, including assistance with the
provision of defence lawyers. Work has also started on the €7.2 million justice
programme for Rwanda. This supports various state institutions, including the
‘gacaca’ i.e. the traditional system of justice, which, it is hoped, will hear prisoners
accused of all but the most serious crimes committed during the 1994 genocide. It
also supports projects promoting community service as an alternative to prison and
NGO projects linked to justice and nationalreconciliation.
Elections
Democracy also depends on the environment for free and fair elections. As the
number ofelections increases in ACP countries, the amount of support fromthe EDF
has also increased fromfour projects in2000 to seven in2001 inCongo, Lesotho, the
Solomon Islands, Sierra Leone, Chad, Togo and Zambia. EDF support begins prior
97COM(2001) 211of11 April2001
141to the election with activities such as voter education and registration. Support can
also take the form of, for example, the printing of ballot papers, as well as longer
term civic education programmes. With the exception of Chad and Zambia, all the
financialsupport outlined above (and approved in 2001) is focused on elections to be
held in2002.
Theresults ofboththe Chad and Zambia elections have beencontested. Reflection is
under waywithin the Commission as to how to make EDF support more effective in
this area. In some cases, additional support is provided for international electoral
observers from the EC budget (line B7-7). Electoral support is generally provided in
consultation with other donors, including the United Nations Development
Programme. Once elected, representatives often need help with obtaining the
facilities required to carry out their tasks such as staff, libraries and computers. The
EC has various projects of this kind, for example, institutional support to the
National Assembly in Angola.
Good Governance
Governance issues are being given increased priority within co-operation strategies,
onthebasisofananalysisofproblems and needs for institutionaldevelopment, often
in consultation with other interested donors e.g. Kenya where the EC is a member of
the Economic Governance Group. One of the main forms of support in terms of the
number ofprojects - and a support which can have an effect far beyond the financial
cost - is the provision of technical assistance to National Authorising Officers. In
most ACP countries this support exists in some form, often in the framework of a
larger programme of aid to the ministry of finance and/or planning with economic,
civil service or other reforms. Assistance is given not only to government ministries
but also to other public bodies that playa role in nationalpolicy.
Thus, in Ethiopia, the financial institutions are receiving support to modernise and
streamline their activities. In the Dominican Republic, a €25 million programme of
state reform and modernisation which was launched in 2001 includes
decentralisation to the local, regional and provincial levels. Devolution of certain
powers to lower levels is a trend that is likely to continue. The €1.91 million pilot
project for the promotion of second-tier towns in Guinea, which originated from the
decentralisation of the 1990s, started in 1998 and aimed at empowering people at the
local authority level to play an active role in development. The recent evaluation
found that, despite the problems, this experiment should be built upon and should be
followed in other partsofthe country. With the emphasis in the Cotonou Agreement
on greater inclusion ofcivilsociety in the development process and thus on capacity
building, pilot programmes like this one will be a useful source of experience.
Censuses - which are an invaluable tool for macro-economic planning - are also
financed from the EDF. A recent example is Niger where a €1.1 million project
started in 2001. By October 2001 the national population and housing census had
been completed. All these activities are closely co-ordinated with structural
adjustment, debt relief(HIPC) and other relevant ECorother donor programmes.
142Zambia Public Welfare Assistance Scheme
An interesting and somewhat unique EDF project is the Zambia Public Welfare Assistance
Scheme (PWAS), which was signed in 1999. It takes only a relatively modest amount of
resources ( €1,160,000) and is designed to improve the Zambia government’s social safety net
through management support, training, and improved co-ordination at all levels. Grass root
organisations are directly involved in decisions on the allocation of resources. The PWAS also
uses existing social structures as much as possible (committees already in place, community
based organisations etc.) rather than creating new ones. The 2001 Zambia Draft Final Poverty
Reduction Strategy Paper recognised the value of the re-designed PWAS. Some €4.13 million
will be provided over the next five years along with co-financing from the government of a
further €0.65 million.Arecent mid-term review of the project hasfound that other countries in
the region could usefully follow it as a model. The evaluation concluded that the PWAS project
should be extended -withanincreased budget - into urban areas. Nevertheless, its achievements
- whilst impressive - were fragile, and so needed consolidating, with further capacity building,
networking with other national partners and more focus on local resources in order to increase
sustainab ility.
InstitutionBuilding– Commitments 2001
ACP Country €million
Angola 0.40
Antigua &Barbuda 0.02
Bahamas 0.04
Botswana 5.12
Burkina Faso 2.8
Burundi 0.08
Cameroon 2.81
CentralAfrican Republic 0.75
Chad 13.89
Congo(Brazzaville) 2.44
Congo(DRC) 0.58
Djibouti 0.11
Dominican Republic 0.02
EquatorialGuinea 3
Eritrea 0.74
Guinea Bissau 0.03
Guinea Conakry 3.07
Guyana 0.2
Haiti 0.15
IvoryCoast 0.23
Kenya 0.54
Kiribati 0.07
Lesotho 0.85
Malawi 1.34
Mali 0.7
Namibia 0.37
Niger 1.99
Rwanda 0.06
Senegal 1.43
Sierra Leone 3.22
Solomon Islands 1.28
Surinam 0.16
Tanzania 0.1
Togo 3.07
Zambia 0.08
Total 51.74
1434.5.7. Macroeconomic Policies and Private Sector Development
4.5.7.1. Macroeconomic Policies
Providing macro-economic budgetary support has become an integral part of the
Community’s financial and technical co-operation with ACP countries. Since 1992,
the Community has provided budgetary support amounting to about €2.604 million
in 40 ACP countries. Formerly, these funds were mostly used to support economies
experiencing ‘balance of payments’ problems. The current approach is to assist
countries inchanging the wayin whichtheir economies work.
Consequently, in 2001 the Commission continued to implement its approach to link
its budgetary support programs to poverty reduction and thus to Poverty Reduction
Strategy Papers established by developing countries. Therefore the majority of the
budgetary support programmes contained performance indicators relating in
particular to health, education and public finance management. On the latter aspect
the Commission has concluded an agreement with the World Bank establishing a
joint EC/World Bank Trust Fund for Public Expenditure and Accountability
Assessments. In addition the Commission is working toward the establishment of
joint arrangements with other donors in order to provide more efficient and effective
donor assistance to the recipient countries.
During 2001, the Commission committed €263 million in direct budgetary support
programmes in ACP countries. It authorised over €300 million in payments to 38
ACP countries which have ongoing structuraladjustment programmes.
Macroeconomic Support - StructuralAdjustment Programmes- Commitments2001
ACP Country €million
Cape Verde 12.1
Gabon 4.9
Ghana 50.8
Guinea 11.1
IvoryCoast 12.8
Jamaica 21.7
Lesotho 18.5
Mali 31.8
Mauritania 18.3
Niger 3.2
Tanzania 76.1
Vanuatu 1.6
Total 262.90
Burkina Fasoand the NewBudgetary Support Approach
From1997 to2000 the Strategic Partnership for Africa (an informal group of donors, under the
leadership of the World Bank) carried out an exercise in Burkina Faso to study the issue of
setting conditions for recipient country for the release of aid (known as ‘conditionality’). The
study has been executed under the auspices of the Burkina Faso government. The new approach
means entrusting the partner government with the leading role in the reform process, while
donors limit their role to assessing results in the field of economic growth and poverty
reduction. The results of the ‘Conditionality Test’ have been largely used in the reform of the
Bretton Woods Institution’s instruments related to Structural Adjustment. One of the major
achievements of this reform has been, in the case of HIPC countries, the design of an overall
development strategyreflectedinthe Poverty ReductionStrategy Paper.
144In the case of Burkina Faso several donors (the Commission, the Netherlands, Denmark,
Sweden and Switzerland), agreed to operate their budgetary support in a complementary
manner using the same disbursing mechanisms tailored on the PRSP. The idea is to reduce
government transactioncosts indealing withdifferent donors, and to provide financial visibility
in the medium term. The 2001 Budgetary Support for Poverty Reduction Programme included
two elements of direct budgetary support. The first of €15 million was linked to the macro-
economic framework, and has been disbursed according to the IMF review of its programme
with Burkina Faso. The second €10 million component has been disbursed based on
performance on a number of indicators contained within the PRSP. In this way the final
disbursement is linked to the effort invested and to the policy implementation and poverty
reduction results in key areas of the PRSP. Achievements thus far are modest, but the process
hasbeenlaunchedandthestakeholdersandtheirresponsibilitiesare nowclearlydefined.
4.5.7.2. HIPC initiative
Two joint ACP-EC Council decisions were adopted in December 1999 on the
Community's participation inthe HighlyIndebted Poor Countries (HIPC) Initiative98.
As a creditor, the European Commission contributes €360 million to the EIB
administered HIPC Trust Fund, and as a donor, will contribute a maximum of €680
m i l l i ontoth eW orl dB an ka dm i ni s te r e dH I P CT r u s tF u n d .
Framework agreements between the EC and the World Bank and the European
Investment Bank set out the legal and practical basis for the provision of the EU's
debt relief. Following the signature of those agreements, a first payment of €250
million was released to the World Bank Trust Fund (July 2000) and a first payment
of €100 million was made to the European Investment Bank Trust Fund (December
2000).
To date, 24 out of 41 HIPC countries (of which 34 are ACP countries) have reached
their ‘decision point’99and are therefore entitled to receive interim debt relief
through the World Bank Trust Fund. The World Bank and the African Development
Bank (ADB) make the evaluationof needs.
With regard to the EC's role as a creditor, the needs analysis is carried out by the EC
services. As countries reach their decision point, the Commission, in close co-
operation with the European Investment Bank, establishes the total outstanding debt
to the EC on a country by country basis (including special loans and risk capital
operations). It then identifies loans to be considered for debt relief and agrees with
the countries concerned which loans willbe finallyselected.
Bythe close of2001, the Commission had sent proposals for debt relief to almost all
eligible countries. A second payment of €250 million was transferred in December
2001to the HIPCTrust Fund administered bythe World Bank and a second payment
of €100 million was made to the HIPC Trust Fund administered by the European
Investment Bank. As at 31 December 2001, only Uganda, Mozambique and
Tanzania had reached their ‘completion point’ under the enhanced HIPC initiative.
Funds freed up by the cancellation of debt servicing obligations are then used to
finance povertyreduction initiatives, inparticular for the socialsector.
98Decision No1/1999and No2/1999of8.12.1999, OJL103, 28/04/2000 p. 0073-0075
99seehttp://www.worldbank.org/hipc/about/FLOWCHRT4.pdf
1454.5.7.3. Private SectorDevelopment (PSD)
The EC’s objective is to ensure long-term and sustainable economic development.
The private sector is perceived as an engine of economic growth, and thereby an
important sourceofemployment inthe ACP countries.
Private sector development is a crosscutting issue and as such is incorporated in the
programming ofother sectors like health, education and infrastructure. The European
Commission's strategy combines support at the macro level (the business
environment and investment climate) the meso (financial and non-financial)
intermediary level and the micro level (enterprise competitiveness).
At the macro and meso level ,ACP national and regional authorities can benefit from
DIAGNOS, a programme which provides assistance in analysis of the private sector
environment in order to identify the main constraints that impede economic growth
in the ACP countries. Diagnostic studies were undertaken in more than 20 ACP
countries in 2001 to help design strategies to provide an ‘enabling’ business
environment for the private sector. At the meso and micro level ACP private
enterprises and service providers can benefit from the EU-ACP Business Assistance
Scheme (EBAS) which aims to provide effective business development services.
EBAS is under full implementation and by the end of 2001 more than 700 projects
had been approved, supporting enterprises, service providers and intermediary
organisations in more than 60 ACP countries. Out of a total of €20 million grant
funds available, €17 million had already been committed one year before the
programme end .
The objective of PROINVEST is to promote investment and North-South and South-
South partnership agreements, and it aims primarily to improve investment services.
The total budget is estimated at €110 million over seven years. The PROINVEST
programme was set up inDecember 2001.
In addition, many ACP countries and regions have allocations for private sector
development included in their national or regional indicative programmes. In South
Africa, for example, PSD is one ofthe keyareas ofsupport and an excellent example
where economic development contributes directly to poverty alleviation. A Risk
Capital Facility Programme for €59 million was decided in 2001 that will provide
access to credit and non-financial support to the previously disadvantaged economy.
Another programme for €34 million will strengthen local economic development in
theSouthAfricanNorthernProvince.
With regards to regional initiatives resulting from the Cotonou Agreement, a €70
million programme to support the Caribbean rum sector was approved in 2001. The
programme assists local rum producers to compete in a fully liberalised spirits
market by modernising their plants, improving their capacity to deal with any
possible environmental impact, increasing their competitiveness and identifying new
markets. The programme will play a fundamental role in strengthening a key sector
within local economies, thereby contributing to job creation and export and tax
earnings onthe basis ofstrong localownership.
The Pesticides Initiative Programme (PIP) is an ‘all ACP’ country programme,
which was drafted at the request of the ACP/EU Council of Ministers meeting in
Cotonou in July 2000. The overall cost of the PIP is €40.1 million, of which €29.1
146million will be paid by the EDF. It is a response to the need for ACP horticultural
sector operators to raise standards ,to meet EU regulations, which set stringent
maximumpesticide residue levels. The objective is to help to create a sustainable and
competitive private horticulturalsector in ACP countries.
Macroeconomic Support – Private SectorDevelopment - Commitments2001
ACP Country Project Title €million
SupportProgrammetoenterprises andinvestmentpromotion 2.80
Havana Trade Fair 0.19Cuba
Training Programmefor headsofcompanies/businessleaders 1.94
Ethiopia Micro&Small Business EnterpriseDevelopment Programme 7.00
SupporttoDepartmentofTradeandIndustry 0.40
Risk Capital 58.90South Africa
Local economic development: Northern Province 34.00
Trinidad &
TobagoCaribbean Business Services Ltd 0.90
Rum 70.00
PublicExpenditureandFinancial AccountabilityTrustFund 1.90
CommodityRisk 1.78All ACP
Centrefor theDevelopment ofEnterprise 20.38
Total 200.19
4.5.8. Social sectors : Health andEducation
4.5.8.1. Healthsector
ACP countries differ widely in terms of their political stability and their
governmental capacity and commitment to deliver results in the health sector. EC
responses have been tailored to the country specific situation leading to a mix of
interventions under the EDF and other EU instruments (thematic budget lines, NGO
co-financing, etc.).
Wherever possible, on-going projects have been re-orientated towards sector
dialogue, the launching of sector-wide approaches and support to sector
programming and finance management. Substantial efforts have been made to
improve the quality of projects implemented. Project management has focused on
speeding up implementation and reducing the time necessary to deliver aid at
beneficiarylevel.
The 2001 health portfolio for ACP countries was estimated at €960 million ( €854
million under the EDF and €107 million under the EC budget’s South Africa budget
line). There were 139 projects in 47 countries with 94 % under National Indicative
Programmesand 6 % under regionalor intra-ACP EDF.
At the time of identification of EC intervention, special consideration was given to
the specific needs and situations of individual countries with emphasis on access to
basic health services and capacity building. At the same time, special attention was
given to the reduction of ad-hoc projects, the merging of requests covering different
sub-sectors into larger globalinterventions to reacha critical mass for impact.
National projects range from post-crisis situations (Angola), resuming of co-
operation through a keysub-sector (e.g. support to immunisation in Nigeria), nascent
SWAPs (Mozambique) to ‘sector accompanying measures’ within poverty reduction
budgetary support projects (Ghana). The regional projects focus on continuation of
147the fight against onchocercosis in western Africa through the co-financing of a donor
trust fund managed bythe World Bank and implemented bythe WHO.
A contribution was made to the setting-up of a Global Fund for the fight against
communicable diseases such as HIV/AIDS, tuberculosis and malaria. Special
attention was given to the complementarity and coherence of the Global Fund in
relationto countrylevelsupport throughother funding mechanisms.
The EC has also taken part in discussions of ways of joint working on projects at
country level with UN agencies (such as the World Health Organisation, the UN’s
Children’s Fund (UNICEF) and Population Fund (UNFPA ) and set-up a health
issues network to bring the sector together, exchange experience and develop good
practice.
Socialdevelopment - Health -Commitments 2001
ACP Country Project Title €million
Angola Health sector support programme 25.00
Guinea Complementarysupporttothehealth sector 5.00
Lesotho Supporttohealth sector reform 1.80
Mozambique Health sector support programme 30.00
Nigeria Prime–Partnershiptoreinforceimmunisation efficiency 64.50
South Africa Partnership for deliveryof primaryhealth careincluding
HIV/AIDS25.00
Swaziland HIV/AIDS prevention and care programme 1.96
Zimbabwe Health sector support programme–phaseII 33.00
Regional: West
AfricaFight against onchocercosis 4.50
Total 190.76
Support tothe health sector inGhana
In 1995 the Ministry of Health, unhappy with results from multiple vertical projects each with
itsownplansandprocedures,embarkedona SectoralWideApproach.Througha participatory
process, a medium term health strategy was adopted in 1996 and translated into a five-year
work programme - agreed with partners - setting out policy, implementation strategies and
resources. The EC joined this process in 1998 with a contribution to the multi-donor fund and
an active participation in the policy dialogue with the government, civil society and donors.
Common management arrangements, monitoring, etc were agreed. In 2001, it became obvious
that despite a budget limited to only US$ 7 per capita, and continuing severe conditions, the
health of the population was improving with, for example, the lowest infant mortality rate in
West Africa and 72,2 % of DPT3 (diphtheria, polio and tetanus) immunisation coverage. At
sucha speedofchange, Ghana is one of the best performersinthe ACP region. Results are very
encouraging. This type of collaboration may prove one of the most efficient in delivering health
outcomes for the benefit of the population.
4.5.8.2. Education, Training and Culture Sector
In 2001, the Commission approved 8 new projects in ACP countries, representing €
98.7 millionofaid tothe educationand training sector. This involved 7 commitments
under National Indicative Programmes and one regional project. The financial
support to the ACP countries in this sector increased by 38 % compared to the year
2000, with larger projects and a more ‘sector-wide’ approach.
The focus during this period was on improving national capacity in education
(Ethiopia, Uganda, Pacific region) and support for basic education (Gabon, Haiti,
148Niger). Both sub-sectors are directly linked to poverty alleviation and contribute to
economic growth, greater democracyand the rule of law.
The global education and training portfolio in 2001 is estimated at €540 million,
involving 111 projects. Small projects accounted for a larger share of the portfolio.
However it is expected that, in countries where conditions are favourable, the
average size ofcommitments willincrease, and improve the levelof impact.
Socialdevelopment - Education-Commitments 2001
ACP Country Project Title €million
Capacitybuilding 0.74 Ethiopia
Education sector development programme 23.00
Gabon Basic education 5.00
Haiti Basiceducation 28.00
Kiribati Training 6.40
Niger Basiceducation 8.70
Uganda Humanresources for health 17.00
Regional:Pacific UniversityoftheSouth Pacific/Humanresources
developmentprogramme5.00
Total 93.84
Humanresource development programme (HRDP) inPapua NewGuinea
The Government of Papua New Guinea prepared in the 1990s important education reforms,
addressing the country’s main problems in the human resources’ sector. Under the 7thEDF,
humanresourcesconstituteda target sector for EC support i.e. university upgrading, secondary
school extensions, in-country trainingand overseasscholarships.
Under the 8thEDF, human resources are again a priority, with €24 million allocated for five
years (until March 2004). The programme ensures a continuity of the EC contribution in this
field in order to increase the quality of teaching, the number the students (particularly girls)
andtodevelopvocational training.
The investment in facilities is aimed principally at new buildings and the renovation of existing
ones. The programme will also provide equipment and training materials to seven vocational
centres, teacher training colleges and universities. Training is provided for both public and
private institutions as well as for new teachers. In addition to in-country training about 120
overseas scholarships have beengranted.
The EU-VanuatuEducation Development Programme
Vanuatu is a Pacific island state with some 200,000 inhabitants. Since independence in 1980, the
Government has made education its first priority, allocating 26% of the total state budget to it
in 2001.
The Commission has increasingly dovetailed with this government priority under successive
Lomé Conventions. The current EU-Vanuatu Education Development Programme is financed
under the 8th EDF and started in September 1999. The project finances both improvements to
the school infrastructure and to the learning process. 18 Junior Secondary Schools (8
francophone and 10 anglophone) - to serve an estimated 2,500 pupils - will be rebuilt and/or
refurbished. At the Vanuatu Teachers College a library, teaching facilities and student
accommodation will be provided. To ensure that the new facilities are put to optimal use
capacity building; the strengthening of secondary school management; in-service training for
teacher/advisers/inspectors and provision of new teaching materials are also being funded. The
project will becompleted by August 2002.
In addition, the Commission approved €9.5 million for a set of cultural projects to
support creative capacityand promote culturalidentityamong ACP countries.
149Socialdevelopment - Culture - Commitments 2001
ACP Country Project Title €million
Angola Film: Na cidadevazia 0.30
Cameroon Decentralised culturalinitiatives 0.25
Central African
RepublicFilm: Lesilencedelaforêt 0.40
Chad Film: Abouna 0.30
Decentralised culturalinitiatives 1.60
Film:CircusBaobab 0.10
Film: Parisselon Moussa 0.30Guinea Conakry
F ilm :L ef le uv eco mmeu nef rac tu re 0.30
Decentralised culturalinitiatives 1.90 IvoryCoast
Film: IndependenceChacha 0.16
Mali Film: Kabala 0.18
French languageradioandtelevision training 0.64
Film: Viedefemmes 0.10Regional: West
Africa
4thmeetingofphotography– Bamako 0.15
Youth Festival:Mandingue 0.12
Choreographydays: Madagascar 0.21
InternationalFilmFestival:Abidjan 0.05
Film:Thewooden camera 0.30All ACP
Financialsupportto11 films 2.10
Total 9.46
Co-operation withSouthAfrica
Support to Education and Training in South Africa is provided as part of the
European Reconstruction and Development Programme (ERDP) and financed from
the SouthAfrica budget line fromthe EC budget.
Between 1995 and 1999, 12 education and training projects were approved
representinga financialcommitment ofapproximately €180 million. Ofthis amount,
an estimated 40% is for skills development and adult education, 10% for primary
education and early childhood development, 20% for higher education and the
remainder mainly for policy support, reflecting South African needs and preferences
during the early post-Apartheid years. During 2001 the EC disbursed €27 million
towardsthese projects, increasing their overalldisbursement rateto 60%.
Micro-projects and refugees
In order to respond to the needs of local communities, the EC has continued to
participate in the financing of micro-projects at local level. In 2001 particular
attention was given to projects with active local participation that have a positive
economic and social impact on the life of local communities. Countries with refugee
problems were prioritised. Whenever possible, the EC has tried to facilitate self-
sufficiency, integration or reintegration ofrefugees.
150Socialdevelopment -Micro projects and refugees - Commitments 2001
Instrument: Microprojects (commitments 2001)
ACP Country Project Title €million
Central African
RepublicMicro-projects programme 2.00
Congo(Brazzaville) Micro-projectsprogramme 1.84
Mozambique Supporttothemicro-projects co-ordination 0.36
Niger Food securityand consolidation of the peace-process 0.77
Total 4.97
Target Group: Refugees (commitments 2001)
ACP Country Project Title €million
Angola Technical Assistance programming of art 255 0.03
Supporttotheeconomicandsocial integration ofrefugees 1.50
Reintegration of young displaced and ex-combatants 0.75Congo
(Brazzaville)
Scholasticreintegration &fightagainstHIV/AIDS&drugs 0.75
Reintegration andauto-sufficiencyfor thedisplaced –Kinsangani 4.40
Reintegration ofwar displaced 0.74Congo(DRC)
Reintegration andauto-sufficiencyfor displaced 8.30
Liberia Reintegration programme for returnees and displaced 25.00
Total 41.47
4.5.9. Cross cutting issues
4.5.9.1. EuropeanInitiative for Democracyand HumanRights (EIDHR)
In 2001, EIDHR has supported projects in ACP countries amounting to €19 million
ofwhich €6.5 millionwas allocatedto 9projects for the promotion and protection of
Human Rights. €925,000 went towards a project covering Benin, Gambia, Burkina
Faso, Nigeria, Mali, Ethiopia, Tanzania and Egypt to support a campaign to eradicate
female genital mutilation. Another project for €867,000 aims to promote women’s
rights in West Africa (Togo, Senegal, Nigeria, Mali, Ghana, Burkina Faso and
Benin).
Support tothe AfricanUniversity (Masters Degree) Programme
in Human Rights and Democratisation
This masters programme educates young professionals at post graduate level, providing both a
firm academic training in standards, institutions and mechanisms for the protection and
promotion of Human Rights and democracy, and the research skills and operational tools
necessary to prepare graduates for work. It emphasises a regional approach to Human Rights
education. Thirty students from a large number of African countries will take part in the
programme, spending the first six months of the year as a group at the Centre for Human Rights
in Pretoria, where they attend advanced lectures on Human Rights. Thereafter they are split up
into four groups that are placed with the participating universities for the last six months of the
year. The participating universities are: the Centre for Human Rights at Pretoria University;
Makerere University in Uganda; the University of the Western Cape (South Africa); the
University ofGhana andthe Catholic University of Central Africa (Cameroon). €1.3 million has
beenallocatedtothe project.
Other initiatives include a project in Benin and Mozambique to improve living
conditions for children and enhance respect for their rights ( €797,000 and €300,000
151respectively) and a €704,000 media support programme to promote Human Rights
inthe peace process inSierra Leone.
Support to the democratic process and the rule of law has been allocated around €6
million e.g. support to staff of Transparency International to develop techniques to
fight corruption and support independent media. In the Democratic Republic of
Congo a €1.2 million project has been set up to promote the rule of law by
enhancing dialogue between government and civil society. €440,000 has been
provided to support the international tribunal in Tanzania which is addressing the
issue ofthose accountable for the 1994 genocide inthe Great Lakes region.
In Cuba, a €500,000 project seeks to contribute to the development of more plural,
democratic and open society, encouraging in particular the free flow of information
and exchange of ideas between Cuban intellectuals on the island and the Cuban
diasporaaroundtheworld.
The support forconflict preventionassistance and the restorationofcivilpeace is one
of the main priorities of the EIDHR. In 2001, it supported 5 projects in Africa to a
sumof nearly €3 million. These projects will be developed in:
•Sudan to support the peace process by promoting dialogue between the Sudanese
parties on concrete subjects of negotiation outside the formal mediation
framework( €500000).
•Somalia, where €600,000 has been allocated to establish a consensus-based
process for identification and prioritisation of reconstruction and development
needs, and recommendations for improved policy&practice.
•the Democratic Republic of Congo to reinforce the dialogue between the local
communities inthe provinces ofKivu ( €500,000)
•Rwanda where a project aims to facilitate legal proceedings following the
genocide inorderto ensure a returnto apeacefulsociety( €670,000)
•Sierra Leone to assisting with the reintegration of displaced young people and
w om eni n toth ei row nc om m un i ti es .
EIDHR has supported the democratic transition and observation of electoral
processes in several African countries e.g. Zambia (presidential, parliamentary and
localelections in 2001 - €570,000) and in Togo (parliamentaryelections expected in
spring 2002 - €527,000) (see also Section 4.5.6. Human Rights, Democracy, Good
Governance and CapacityBuilding / Elections ofthis chapter).
4.5.9.2. NonState actors and NGO activities
The involvement ofnon state actors in thepartnership
The Cotonou Agreement includes innovative provisions to promote participatory
approaches to ensure the involvement of civil society and economic and social
actors. This entails the provision of information on the partnership and consultations
with civil society on the economic, social and institutional reforms and policies
which the EU proposes supporting. In addition, there is a new focus on facilitatingnon-state actors’ involvement in the implementation of programmes and projects,
152and providing them with the necessary financial resources and support for capacity
building.
A preliminary assessment of progress made in implementing those provisions in the
programming process shows that in 42 countries out of the 50 for which draft
Country Strategy Papers were available, a process of consultation was conducted
with non state actors (NSA). In 25 of those 42 countries the draft Country Strategy
Paperwasmodified followingtheconsultationprocess.
Different types of strategies have been followed to involve NSAs in future co-
operation. Ina number ofcountries the response strategy is geared at enhancing NSA
participation in all sectors of EC co-operation and by different means
(mainstreaming). In others, NSA involvement is mainly planned for in the priority
sectors. A third type of strategy provides support to NSAs in non-priority sectors,
either as a means for targeting poor population groups or as a contribution to good
governance and conflict prevention.
Regarding funding, in 26 country programs the provision of direct funding for NSA
capacity building or other support is proposed. In total the proposed funds allocated
directly to NSAs in those countries amount to approximately €130 million out of a
total programming envelope of approximately €3 billion. However only in 12
countries (Gambia, Gabon, Kiribati, Jamaica, St. Lucia, Chad, Vanuatu, Zimbabwe,
Burkina Faso, Guyana, Sao Tome and Botswana) has the eligibility criteria for NSA
funding beendiscussed withthe National Authorising Officer.
Finally out of the 50 Country Strategy Papers surveyed, 31 mention follow up
arrangements for future consultationand monitoring.
Support tothe municipal development programme inWest and Central Africa
The ‘West and Central Africa Management Association for the Municipal Development
Programme’ (PDM) brings together national associations with local responsibilities,
municipalities and community and non-governmental organisations involved in local and
municipal development initiatives in West and Central Africa. This is particularly aimed at
allowing large urban conurbations to increase their implementation capacity. Two main
activities have been undertaken – the strengthening of local implementation capacity and the
training of around 60 municipal staff (1998 to 2001). Training activities have gone ahead very
successfully, as has the setting up of a programme to strengthen the capacities of national
associations of locally elected people and support the setting up of an African municipal
movement at the sub-regional and continent wide level. This is being taken forward on the
ground in the training cycle of local authority staff. The Canadian International Development
Agency (CIDA), the World Bank, the French Foreign Ministry, the French ‘Ile-de-France’
regionandtheCanadianMunicipalities’Federationareparticipatinginthisproject.
4.5.9.3. Gender Issues
As in all regions, gender considerations are one of the driving forces behind EC
interventions in the ACP countries. Where appropriate i.e. in the vast majority of
cases, programmes and projects specifically identify the role of women, female
adolescents and children within the process. This includes targeting women as
beneficiaries, consulting the female population in the preparation of the project,
analysing to what extent women are active participants in implementation, as well as
proposing remedies to any possible obstacles to women’s access to the resultant
benefits. Gender considerations are examined inthe planning ofallEC support.
1534.5.10. Trade and Development
For ACP countries, non-reciprocal trade preferences have been in place since 1975.
Preparations are also under way for the negotiations of Economic Partnership
Agreements (EPAs) with ACP sub-regions. To achieve the objectives of EPAs, the
ACP countries have to fully integrate EPAs within their development strategies. The
EC, in turn, will support policies complementary to EPAs through development
support as set out inthe Cotonou Agreement.
4.5.10.1.Development support and Economic Partnership Agreements
The link to development co-operation will be a key aspect for the negotiations on
Economic Partnership Agreements both ina narrow sense, regarding the capacities to
manage negotiations, and, in a broader sense, regarding the ability to implement the
emerging agreements and therebyto increase trade flows.
Capacity needs fornegotiations
Many ACP countries and regions do not have the capacity to enter into
comprehensive trade negotiations. However, independently of EPAs, they are faced
withthe challenge offollowing multilateral, regionaland bilateral negotiations at the
same time. Instead of exacerbating this situation, the EPA process can help to tackle
this by providing substantial support for ACP countries and regions. In line with the
Cotonou Agreement, substantial funds are foreseen in the regional support
programmes, to strengthen analytical and negotiating capacities of both the regional
organisations and their member states.
Development support fortrade
In a more comprehensive sense, it is necessary to effectively ‘mainstream’ trade into
development co-operation, an important element of the Cotonou Agreement.
Development co-operation programmes in areas such as macroeconomic support,
transport, private sector support, etc. need to take the trade dimension better into
account. First steps into this direction have been taken by mainstreaming trade
concerns in the national and regional strategy papers for the 9thEDF. In addition, a
number of ‘all ACP’ programmes have been or will be initiated to address trade
bottlenecks in ACP countries. EPAs will enhance this process by linking trade
negotiations closelyto development support programmes.
EC Support for ACP Trade policy
–Strengthening the negotiatingcapacity of the ACPin the WTO and on EPAs.
–ACP WTO and EPA support programmes of €10 and €20 million have so far has been
offered on an ad hoc basis for studies and co-ordination meetings. However, from July
2002 onwards, programmes will co-ordinated in Brussels though a steering committee
andwill beinitiatedby ACPcountriescoming forwardwithrequestsfor assistance.
–Supporting ACPcountries’presence inGeneva where WTO activities take place.
– €1.4 million has been spent on thenewACP Antenna (will be opened in January 2002) in
Geneva, and will serve asafocal point.
–Helping ACP partners fulfil ECsanitaryand phyto-sanitary standards.
154–A €29 million 5 year Pesticide Programme for the ACP countries wasestablishedin July
2001. The project includes information/communication; regulation; good practice
(working on the implementation of adequate quality control systems) and capacity
building100.
–Assisting ACPintegrationintoworldtrade.
–At the ACP Ministers of Trade meeting in November 2001, the Commission proposed a €
50 million facility to support ACP integration in world trade once the 9thEDF becomes
available. In addition, some €350 million have been earmarked for regional integration
and trade related technical assistance / trade capacity building in the next five year
programming period. Allocations for trade related support can also be included as non
priority sectors of the national indicative programmes, depending on requests made by
ACPauthorities.
4.5.11. Coherence with other policies
Trade and investment liberalisation can play an important role in economic growth.
The EC is seeking to integrate developing countries into the world economy on the
basis of the Doha Development Agenda, linking trade and development in the
multilateral trading system. The EC is in addition providing considerable Trade
related Technical Assistance to strengthen partner countries judicial, regulatory and
institutional capacities in this field.
In the context of the WTO, the EC has been a strong advocate of multilateral trade
negotiations centred on the needs and interests ofdeveloping countries.
Under Cotonou, assistance in trade related issues will be provided at national,
regional and horizontal (available to all ACP countries) levels. €10 billion is
earmarked for the former along with around €260 million for regional interventions.
Horizontal programmes include a €10 million WTO support initiative and a €20
million support programme to allow ACP countries to effectively enter into
negotiations for Economic Partnership Agreements.
4.5.12. Co-operation with other donors in the region
The sector wide approach means that donors are increasingly pooling resources
rather than undertaking individual actions. The Cotonou Agreement further stresses
the need for co-operation between donors and this is being reflected by increased
coordination, particularly within partner countries themselves. The EC has various
Framework Agreements with bilateral and multilateral donors such as the agreement
signed withItaly in1985 which has beenrenewed up to March 2003 to which the EC
h asm a d eac om m i tm en tof €140 million. Specific examples are as follows:
•Joint Programme for Public Expenditure and Financial Accountability
Assessments.
A €2 million programme, financed through a trust fund, has been put in place
with the World Bank and opened for contributions from other donors. It is
designed to improve good governance, fight corruption and make public
expenditure in ACP countries more effective in pursuing development objectives,
particularly as regards poverty reduction. Methodological studies to identify
100seehttp://www.coleacp.org
155appropriate performance indicators and joint public expenditure reviews should
contributeto asignificant improvement inthe management ofpublic funds.
•Test Cases on Commodity Risk Management: World Bank Trust Fund.
A financing agreement was signed in July 2001 to provide financing for the
development of eight prototype test cases of commodities price risk management
instruments in ACP countries. The aim of the initiative is to extend price
insurance mechanisms which exist in the developed countries to developing
countries so as to reduce the risk of sharp falls in the prices of major commodities
(coffee, cocoa, cotton, sugar, etc.) inparticular for the benefit ofpoor farmers.
The total grant amount to be provided by the Community for the ACP/EU
Commodities Risk Management Trust Fund is €1,737,600 to be administered by the
World Bank withthe objective ofdeveloping prototype test cases.
The list below provides summarised examples ofco-financed activities.
List ofCo-financing Arrangements completed during 2001
ACP
Countryor
RegionProjectTitle Co-financingPartner Type of
Co-financing€million
SierraLeone Rehabilitationand
Resettlement
ProgrammeGermany;Sweden;UK;
Italy;the Netherlands;
USA;Switzerland;
Canada; Norway; WorldBankTwo Instalments
made to a multi-
donor trustfund
managedbytheWorld BankEC:10
Others:35
WestAfrica Agricultural Research
ProgrammeFrance;UK;Belgium;the
Netherlands;USA,Parallel EC:12
Others:10.36
Somalia Pan Africancontrol of
animaldiseasesItaly Joint EC: 72
Italy: 1
Chad Rural watersupply
‘OuadaiBiltine’Germany&France Joint EC:2
Germany:5France:5
All-ACP TrustFundfor Public
ExpenditureandFinancialAccountabilityWorld Bank Instalment madeto
a single-donor trustfund managed bytheWorldBankEC:1.95
World Bank:2
All-ACP ACP/EUCommodity
RiskManagementWorld Bank Instalment madeto
a multi- donor trustfund managed by
theWorldBankEC:1.74
4.5.13. EIB loans
The European Investment Bank (EIB) aims to promote economic growth and the
integration of ACP countries into the world economy101. The focus under the
Cotonou Agreement is on the private sector as the main engine of economic growth.
However, viable revenue generating projects inalleconomic sectors areeligible.
The Investment Facility (IF) is a new instrument that will replace ‘risk capital’ and
provide increased financialresources fromthe 9thEDF. TheIFwill:
•be managed along commercial principles to be financially sustainable;
•be a revolving fund i.e. re-flows will be invested in new projects;and
101seehttp://www.eib.org/lending/acp/index.htm
156•assure ACP countriesoffuture availabilityofresources.
Other EIB financed loans will continue to be available alongside the Investment
Facility.
Some project highlights for2001
€144 million was spent on the Chad-Cameroon Pipeline Project102in a combination
of €88 million of EIB resources and €56 million of (EDF) risk capital resources.
The Chad-Cameroon Pipeline is part of a broader integrated oil development and
pipeline project, supported by the World Bank and international oil companies. The
environmentalandsocialaspectsoftheproject were scrutinised inclose co-operation
withtheWorldBank.
€50 million was spent on the N4 Toll Road Project in South Africa103. The project is
a key element in the toll road network to the North and West of Pretoria. The EIB
helped provide Rand funding that enabled the promoter to avoid foreign exchange
risk in this important South African PPP project.
€15 million was spent on micro-finance ventures channelled through micro-finance
specialist funds. The objective of the bank is to help these funds develop and reach
commercial maturity and financial self-sustainability. Ventures will be co-financed
withother donors and, where necessary, combined with grants fromother sources for
institution building measures.
EIB loans to ACPandthe Republic ofSouth Africa 1997-2001
Sector
( €million)ACP
(1997-2001)ACP
2001South Africa
(1997-2001)South Africa
2001
Energy 655 260 102 -
Transport &
Telecommunications191 16 145 50
Environment 159 69 45 -
Industry, Services 307 48 25 -
SMEs (Global loans) 584 127 459* 100*
Total 18 9 6 520 776 150
* Alsoincludes support for smaller scalemunicipalinfrastructureschemes.
4.5.14. ECHO
In 2001, the ACP countries were the biggest recipients of humanitarian aid from
ECHO with a total amount of €173.32 million. Within Africa, the biggest crisis
remained in the Great Lakes with €35 million allocated for the Democratic Republic
of Congo, €32 million for Burundian refugees in Tanzania and €20 million for
Burundi itself. In addition, hundreds of thousands of refugees, internally displaced
people and other local vulnerable populations all over the continent benefited from
life-saving emergency aid delivered by European Community Humanitarian Office’s
partners under verydifficult circumstances.
102Classed as ‘Oil and Gas deal of the Year’ by Project Finance International magazine and ‘Project Finance Loan of
theYear2001’bytheInternationalFinancingReview
103InfrastructureDeal oftheYear’byProjectFinance Internationalmagazine
157Although the politicaldevelopments in manyofthe beneficiary countries leave some
serious doubts as to whether a long-term improvement of the humanitarian situation
is likely, there are nevertheless some positive signs (e.g. a stabilisation in West
Africa).
E C H Om a n a g e dt oi m p r o v et h ed e l i v e r yo fi t sa i dt oA C Pc o u n t r i e sb ym a k i n gt h e
bulk offunding available at the verybeginning of2001, allowing for quick responses
and fine-tuning ofthe strategyinthe course ofthe year.
European Community Humanitarian Office’s(ECHO)
Financing Decisions in 2001
ACP Country €million
Angola 9
Burundi 20
Burkina Faso & Chad 2.55
Caribbean/Pacific(including‘disaster preparedness’) 3.88
CentralAfrican Republic 1
Congo(DRC) 35
Eritrea 7
Ethiopia 9.2
Kenya 4.6
Madagascar 0.9
Mozambique 2.84
SierraLeone, GuineaConakry&Liberia 20.6
Somalia 1.7
Sudan 17
Tanzania 32.15
Zimbabwe 0.5
ECHOflights(basedin Africa, for aiddistribution) 8.4
Total 176.32
4.5.15. Monitoring inACP countries
The Commission, during 2000, established an improved results-oriented monitoring
system for the ALA104/MED/ACP and the Balkans, rooted in the Commission’s
Project Cycle Management mechanisms. The system was tested in 2001. Now that
the testing-phase is at an end, the Commission is in a position to offer some initial
insights on what has worked well and what needs substantial improvement in this
region. Further information on the results-oriented monitoring system can be found
in Chapter1 (section 1.4). This new monitoring system will be fully operational as
from2002).
During 2001, 173 projects (ofwhich 18 have been revisited) have been visited in the
ACP region, in 23 countries. The total volume of EC financing thus covered is
€1902.9 million of which the most important (DAC) sectors were infrastructure and
economic services (36%) and economic and institution building, civil society and
social infrastructure and services (15%). The overall rating for projects in the region
was slightlyabove average i.e. 2.55, compared to anaverage rating of2.5.
Effectiveness and impact seem to be, relatively, the most successful aspects.
Environmental and technical aspects also came out well, while weaknesses included
economic and financial factors and efficiency, especially relating to ‘timeliness’.
104Asia and LatinAmerica
158Nevertheless, the regional analysis level of project performance should be treated
withsome caution(see Section1.4).
4.5.16. Conclusions and Perspectives
EC development assistance will continue to strive towards the attainment of
Millennium Development Goals (in the ACP, as in other regions). This will require
quality dialogue with national authorities on the development of sector wide
approaches and close co-operation with EU Member States and other partners. The
Cotonou agreement and the Reform of the management of the EC external aid
providetheframeworkforthis.
For beneficiaries and representatives of civil society in the ACP partner countries,
the new programming approach - characterised by the rationalisation of co-operation
instruments and the introduction of a ‘rolling programme’ - represents a unique
opportunity to assume a more ‘hands-on’ approach to and transparent control of
valuable development assistance resources. Nevertheless, there is a ‘price to pay’ of
increased discipline and an undeniable need to assign scarce skilled human resources
to management tasks.
As far as EU Member States are concerned, the new approach represents a golden
opportunity to make real progress with the search for complementarity, which until
now has been more evident in theory than in practice. The corollary is that they too
must accept radical changes in working practices, in information sharing and in
consultation requirements if the mutually accepted deadlines of the new Agreement
are to be achieved. The outcome of the negotiations for a new Internal Agreement
will indicate the extent to which these required changes in practice are going to be
achieved inreality.
It cannot be stressed too much that if the new approach to ‘rolling programming’ is
to be cost-effective in the long run for all concerned, it will inevitably demand a
considerable extra effort ‘up front’ to ensure the quality and viability of the initial
programming exercise. Once this is achieved, and the implementation process is
seamlessly linked with the initial programming of the Country Strategy Papers, the
ongoing management process will become less burdensome and hopefully more
flexible and effective for allconcerned.
1594.6. ASIA
4.6.1. Introduction
InearlySeptember 2001, and priorto the cataclysmic events of11thSeptember 2001,
the Commission underlined that “Asia’s importance for the EU is beyond question
whether economically, politically or culturally, or in relation to regional and global
challenges, such as poverty, environment or democracy and Human Rights". This
analysis has become even more relevant in the light of the challenges that have
become evident as a consequence for everyone of the terrible attacks on the World
Trade Centre in New York, and Washington. Many of these concern EU relations
with Asia, particularly in relation to the fight against terrorism, the effects of
religious fundamentalism and, as a result, the new challenges of reconstruction faced
in Afghanistan.
On 4thSeptember 2001, the EC adopted a new strategic framework in the EU
relations with Asia and its sub-regions in the coming decade. The main thrust of the
new approach is based on the core objectives of strengthening the EU political and
economic presence across the region, and raising this to a level commensurate with
the growing globalweight ofanenlarged EU.105
Asia accounts for 56% of the world’s population (and 66% of the world’s poor), for25% of world GNP, and for a gradually increasing 27.5% of EU imports (up from
26.9% in1997) and relativelyconstant 17.6% ofEU exports between1997 and 2000.
This has resulted in a significant growth in Asia’s trade surplus with EU from
€33.1
billion in 1997 to €118.1 billion in 2000. Asia is the EU largest trade partner in
terms of imports and second largest market for exports. With regard to Foreign
Direct Investment (FDI), however, Asia has not regained its market share of EU FDI
since the Asian economic crisis, receiving only an average 6.6% of EU FDI between
1997 and 2000106.
4.6.1.1. Anevolving regionaldialogue
Since 1994, the European Commission’s political dialogue with the region has
evolved considerably, with new Summit dialogues with the Asian partners in the
Asia-Europe meeting (ASEM), and with China, India, Japan and (soon) Korea. The
Ministerial dialogue with ASEAN continues, and now includes active EU
participation in the ASEAN Regional Forum (ARF). High-level contacts with
Australia and New Zealand have likewise been strengthened. In addition in 2001, the
EU has continued to make an active contribution to peace and security issues in the
region, for example in its assistance for the establishment of democratic government
in Cambodia and East Timor, support for refugees in and from Afghanistan, and in
thecontributionto KEDO107.
105Viz.Detailsin section 4.6.14.Conclusionsand Perspectives
106Trade figures include Japan, China, Hong Kong, South Korea, as well as countries of ASEAN and
South Asia
107KEDO:Korean PeninsulaEnergyDevelopmentOrganisation
1604.6.1.2. Bilateralrelationships and Co-operation Agreements
EU external co-operation policies are legally formulated and administered through
co-operation agreements, protocols, administrative arrangements and memorandums
ofunderstanding. These provide the basis for the implementation ofprogrammes and
incurring budgetaryexpenditures.
Trade and Co-operation AgreementsforAsia
COUNTRY TYPEOFCO -OPERATION AGREEMENT DATEOFSIGNATURE
ASEAN108Co-operationAgreement1097thMarch 1980
China TradeandEconomicCo-operation Agreement 21stMay1985
Macao Agreementfor TradeandCo-operation 5thJune1992
India Co-operation Agreement on Partnership & Development 20thDec. 1993
Sri Lanka Co-operation Agreement on Partnership & Development 18thJuly1994
Vietnam Co-operation Agreement 17thJuly1995
Nepal Co-operation Agreement 20thNov. 1995
Cambodia Co-operation Agreement 29thApr. 1996
Korea FrameworkAgreementforTrade&Co-operation 28thOct.1996
Lao PDR Co-operation Agreement 19thApril1997
Bangladesh Co-operation Agreement on Partnership & Development 22ndMay2000
Pakistan Co-operation Agreement on Partnership & Development 24thNov. 2001
EC Co-operation with countries in Asia largely takes place under the 443/92 ALA
Regulation which was adopted in 1992. This Regulation encompasses a complete
strategic framework110which covers development assistance, economic co-operation,
environment, as well as a strong reference to need for promoting democracy and
Human Rights. Priority fields for EC Co-operation activities in Asia have continued
to focus on institutional capacity building, and promotion of primary health care and
educationas a means to fight poverty .
Commitments and Payments in Asia 2000/2001 ( €million)
Commitments Payments
Programmes 2001 2000 2001 2000
Countries Bilateral 225.0 283.0 264.6 240.2
Regional 64.5 96.6 41.2 36.6
Sub TotalBilateral/Regional 289.5 379.6 305.8 276.8
Other Budget lines 88.8 67.4 72.1 41.7
GrandTotal 378.3 447.0 377.9 318.5
108Association ofSouth EastAsian Nations
109Protocol extending the agreement to the Socialist Republic of Vietnam signed on 14thFebruary 1997.
Protocols extending the Agreement to the Kingdom of Cambodia and the Lao People’s DemocraticRepublic signed on 28
thJuly2000
110Council Regulation (EC) No.443/92 of 25 February 1992 on financial and technical assistance to, andco-operation with, the developing countries in Asia and Latin America published in OJ L52, 27
th
February1992.
1614.6.1.3. Highlights ofour co-operation inAsia in2001
Two major events, one natural and the other man-made, feature significantly in the
2001 report on EC-Asia co-operation. These were the Gujarat Earthquake and the
11thSeptember aftermath in Afghanistan.
India -GujaratEarthquake
When the earthquake struck Gujarat on Republic Day (January 26th 2001), Chris Patten,
Commissioner for External Relations, was in New Delhi on an official visit. He immediately
conveyed the condolence message of President Prodi to the President of India, Mr. K. R.
Narayanan, underlining that: “The European Union is with the people of India during this hour
of tragedyand we are readytohelp inevery possible way.
ECHO responded very swiftly to the disaster providing €3 million on January 27th, and a
further 10 million four days after the quake. These funds were allocated to European NGOs to
provide emergency aid in the most affected areas. The newly created Europe Aid Co-operation
Office of the EC immediately sent an identification mission to the affected areas to produce a
viable and sustainable aid package to facilitate social and economic recovery in the state. Based
on its conclusions the EC provided a support package of around €80 million, confirming EU
solidarity with Gujarat, and which included a Health ( €40 million Rehabilitation ( €15 million)
andNatural Resourcescomponent ( €25million).
Afghanistan-Startinga Recovery Programme
Following the events of the 11thSeptember 2001, the Heads of State and Governments declared
on October 20ththat the EU would join the international community in a "far reaching and
ambitious programme of political and humanitarian aid for the reconstruction of Afghanistan".
In 2001, the Commission committed almost €103 million for assistance to Afghanistan, half of
which was channelled through ECHO. Even prior to 11thSeptember, assistance had been
provided to displaced persons and food-related assistance was being delivered to rural areas.
The Commission subsequently made a proposal for a further €57.5 million for support to a
reconstruction programme in Afghanistan to be decided in early 2002. The overall objective of
this Programme is to support the stabilisation of the country by contributing to basic
governance andtomeet basicneeds.
Overview ofCommitments/Payments 1995-2001 ( €million)
1995199619971998199920002001 Total
Commitments 457.3 405.7 435.3 423.3 342.7 447.0 378.3 2900.5
Payments 219.3 279.1 301.9 262.1 289.2 318.5 377.9 2048.0
4.6.2. Regional co-operation
TheEUhasa longstanding relationship withSouthEast Asia, whichoperatesthrough
a number ofpartnerships.
4.6.2.1. The EU-ASEAN partnership
Relations between the EU and the Association of South East Asian Nations
(ASEAN) are based on a Co-operation Agreement (1980) between the EC and
member countries ofASEAN111.
111ASEAN Countries: Brunei, Burma/Myanmar, Cambodia, Indonesia, Lao PDR, Malaysia, Philippines,
Singapore,Thailand, Vietnam
1624.6.2.2. EU-SAARC
The EU has consistently affirmed its interest in strengthening links with the South
AsianAssociation for RegionalCo-operation(SAARC112) as a regionalorganisation.
With 1.3 billion inhabitants in 1999, SAARC member countries represent almost
22% of the world population, but only 1.97 % of world GNP (575 billion US $ in
1999) Average per capita income is US$ 441 (World Bank, 1999). Indeed poverty is
onefundamentalelement characterisingthesituationinSouthAsia.
4.6.2.3. ASEM
ASEM (the Asia-Europe Meeting) is an informal process of dialogue and co-
operation bringing together the EU Member States and the European Commission,
with ten Asian countries (Brunei, China, Indonesia, Japan, South Korea, Malaysia,
the Philippines, Singapore, Thailand, and Vietnam). The ASEM dialogue addresses
political, economic and cultural issues, with the objective of strengthening the
relationship between our two regions, in a spirit of mutual respect and equal
partnership. In 2001, the Commission committed a grant of €20 million for a second
phase ofthe ASEM Trust Fund, thereby lending continuing support to reforms in the
financial and social sectors particularly in Asian ASEM partners directly affected by
the 1997 Asiancrisis.
4.6.2.4. Specific programmes include:
–t h e Asia-Link programme which will provide €40 million over five years to
promote regional and multilateral networking between higher education institutions
inEU Member States and SouthAsia, SouthEast Asia and China and
–t h e Asia Urbs Programme which aims to strengthen the capacity of local
governments in urban management, with an emphasis on alleviating poverty in the
local communities.
In 2001, this Asia Urbs co-funded Project ‘Asia Rehab: Improving Daily Life for
Residents by Preserving and Restoring the Historic Centre of Hanoi’ completed its
first year. Residents are being encouraged to improve their own properties and,
where possible, to remain in their homes during the improvements. About 50
residents from just two buildings – one straddling two streets and housing five
families, the other including a jewellery shop and housing four families –
participated in a pilot restoration scheme in the first year. The experience and
achievements will provide an example for other householders to follow in the future.
Establishing a credit system for financing these activities proved one of the more
trickyareas to initiate as raising enthusiasm in the Banking sector has not been easy.
But providing technical assistance and techniques for improving buildings and
associated living space, and intervention of legal and regulatory experts to address
obstacles in landlord/tenant relationships, and guidance in planning have all
proceeded well .
Under the Asia-Urbs programme, funds are provided for local government
partnerships to jointly undertake feasibility studies and/or two-year pilot projects
addressing certain key areas of co-operation– urban management, urban
112SAARCCountries: Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka
163environment, socio-economic development and urban social infrastructure. The main
areas ofco-operation for the 28 projects approved (totalling €11 million) for funding
in 2001 were, Waste management (7), Entrepreneurship/economic development (5),
Urban management (3), Cultural heritage (3), Education/training (3), Water
management (2), Pollution control(2), Innovative technologies (1).
RegionalCo-operation Commitments 2001 ( €million)
Regional Co-operation Project Title Amount
ASEM AsiaTrustFund 20.0
Asia ProEco(ex-Ecobest) 31.5
Asia ARCBC rider (biodiversity) 0.9
SUB-TOTAL 52.4
4.6.3. Transport
Air transport and maritime transport are the main components of EC assistance in the
transport sector for Asian countries. These areas will play an important role, as
efficient transport systems are essential in the economic development of Asian
countries. The implementation of co-operation projects will demonstrate the benefits
ofEuropeanpractices inthe region.
4.6.3.1. Maritime transport
EU-India Maritime Project : The project aims to improve the efficiency of two ports
in India, and also to support the Government of India to introduce electronic data
interchange in the sector. The EC contribution to this project is €8 million (total
project budget: €10 million). This project has already started to improve the
conditions for trade and investment in the port sector. During 2001, various activities
have been completed at Jawaharlal Nehru Port and Chenai Port, including the
restructuring of the port community and feasibility studies in the area of electronic
data interchange. Also port maintenance, traffic forecasting and planning capabilities
have been enhanced.
4.6.3.2. Air transport
Priority was given to enhance air safety and to increase EU–Asian co-operation in
the aerospace sectorthrough:
EU-India Civil Aviation Project ,E Cc o n t r i b u t i o n €18 million (total budget €28
million)
During 2001, European experts have visited 6 Indian airports. Workshops have been
organised concerning such themes as ‘Airspace Management’, ‘Regional Co-
operation’ and ‘Certification of Large Aircraft’. A top-level executive seminar was
alsoorganisedonthethemeof‘AirlineManagement’.
EU-China Civil Aviation Project, EC contribution €7 million (total budget €15
million)
In 2001 activities on ‘Regulatory Harmonisation’ raised a considerable interest from
Chinese counterparts. In addition training activities on the ‘Airworthiness’ have
164already resulted in the full qualification of 14 Chinese training organisations.
Likewise the implementation of ‘Production Management’ activities has already
resulted in the setting up of two production lines in Xi’An, and Chendu in Sechuan
Province.
Insummarythe two civilaviationprojects have already:
– increased the awareness of the EU industry practices including airworthiness
and safetyregulations and standards.
– assisted the development of the future air traffic management environment as
wellasthedevelopmentofairport infrastructure.
– developed knowledge and practice of modern product support, maintenance
and overhaultechniques.
During 2001, the Commission has also been involved in negotiations concerning the
proposed the EU-Asian Civil Aviation Co-operation Project covering 15 other
countries from South and South East Asia. The EC contribution for this project is
foreseen at €15million(totalproject budget: €30million).
4.6.4. Food Security and Rural Development
Sustainable rural development and food security are important components of the
anti-poverty strategies of the Community. In 2001, €20 million was allocated for
direct food aid to North Korea with additionally €4.5 million allocated for indirect
assistance via World Food Programme, mainly for purchases of agricultural
implements and fertilisers. Bangladesh was allocated €24.5 million for food
security(ofwhich €3 millionwas set aside for food aid).
Afghanistan was allocated €16 million (via WFP) as wellas €4 million for food aid
via Euronaid. Cambodia €5 . 7m i l l i onan d Lao PDR €1.1 million were beneficiaries
of food security projects delivered via NGOs. Finally, India received almost €1.0
millioninthe formoffoodaidviaEuronaid.
RuralDevelopment, Food Security – Commitments 2001 ( €million)
Country Project Title Amount
Pakistan VeterinarySupport 22.9
Asia CGIARAgri-Research 7.5
Indonesia DevelopmentofirrigatedagricultureinBululengKarangAsem 6.1
Cambodia Northern Province (Study) 0.6
TOTAL 37.1
4.6.5. InstitutionalBuilding
Institutional capacity building has been defined as one of the focal areas of the
Community’sdevelopment co-operation.
Specific goals inthe area ofInstitutionalStrengthening for 2001include:
– The development of transparent, accountable and effective governance and
administrationinallpublicandsemi-public institutions;
165– The strengthening of the rule of law and improved access to justice while
guaranteeing the professionalismand independence ofjudicialsystems;
– The fight against bribery, corruption and nepotism.
InCambodia, assistance was provided for the communal elections which took place
early in 2002 including technical assistance to the National Election Committee as
wellas financialsupport throughthe UNDP.
Implementation continued on institutional support projects in China,s u c ha st h eE U
China Legal and Judicial co-operation programme, the EU-China Statistical Co-
operation Programme and the EU-China Village Governance Programme (launched
in Beijing byChris Patten inMay2001).
Development co-operation was for the first time initiated in North Korea (DPRK).
Preparatory work in 2001 allowed identification of two pilot projects for assistance.
These projects will provide training for the economic reformprogramme and support
increased efficiency inthe energysector.
A new livestock services programme was approved for Pakistan, which involves the
strengthening and restructuring ofpublic livestock service delivery.
Amongst new development initiatives for Vietnam a programme in support of the
Ministry of Labour to improve the supply of skilled labour to key sectors was
identified ( €10 million). Another project will focus on institutional support for the
development ofsmalland mediumsizedenterprises.
InstitutionalBuilding – Commitments 2001 ( €million)
Institutional
ReinforcementCountry Project Title Amount
Good Governance Indonesia Good GovernancePartnership 13.30
Democratisation Cambodia Elections/UNTrust Fund 2.95
Institution Building North Korea
(DPRK)*Pilot Project in institutional support/training 0.97
Institution Building North Korea
(DPRK)*Pilot Project in theEnergySector 0.93
Institutional Support Nepal Census 0.40
TOTAL 18.55
* DPRK: DemocraticPeople’sRepublicofKorea
4.6.6. Private Sector Development
Economic co-operation with Asia continues to focus primarily on the promotion of
mutually beneficial business-to-business co-operation, enhancing Europe’s profile in
Asia and that of Asia in Europe, increasing Europe’s economic presence in Asia and
assisting countries to define and implement policies to improve their economic
situationand performance.
166– Business to Business
TheAsia-Invest Programme started as a cross-sector economic co-operation
programme with Asia, to promote business co-operation through mutually beneficial
partnerships between Asia and the European Union. The Programme provides a
range of grants, support instruments and access to an extensive network and partner
search database to representatives of companies, including Chambers of Commerce,
sector and industry organisations, professional associations, industrial federations
and businessdevelopment agencies, withparticular emphasisonSMEs.
Over the course of the Programme to December 2001, 143 Projects were co-
financed. In 2001 alone 85 projects were approved, totalling an EC contribution of €
7.98 million.
The EC underpins the capacity of Asian businesses to engage in mutually beneficial
linkages with EU business through its support to European Business Information
Centres(EBICs) throughout the region (i.e. in Sri Lanka, India, Malaysia, and the
Philippines). In 2001, a new EBIC was opened in Hanoi,V i e t n a m .E B I C ’ so f f e ra
range of information to Asian businesses or associations. In 2001 around €805,000
was spent in support of activities of EBIC’s in Sri Lanka, India, Malaysia and
Vietnam.
–I nBhutan, the focus in 2001 was consolidation and preparation of the second
phase ( €4.2 million) of the EC-supported “Medicinal Plants” project. This
phase will target the full sustainability of the Institute of Traditional Medicines
Services (ITMS) as a component of the long-term development of the
medicinalplants sector for the country.
– Programmes in the field ofBusiness Training
TheChina-Europe International Business School (CEIBS) in Shanghai was
established in 1994 as a result of phase I of an EC financed project. The objective of
the CEIBS is to enhance China’s commercial and industrial links with the EU by
providing management training and by facilitating the transfer of international
management expertise to managers in China. EC support to the CEIBS entered its
second phase in 2001 with a EC commitment of €10.95 million. In 2001, CEIBS
reaffirmed its position as the best business school in the Chinese mainland by
breaking into the world top 100 MBA list. In 2001, around 600 students enrolled for
the MBA and EMBA courses. In addition, CEIBS received some 4300 short-termstudents.
In 2001, the EU-China Junior Managers Programme (
€11.64 million) awarded
diplomas to 24 young EU managers in 2001. The EU-China Programme for the
Development of Industrial Vocational Training trained , 408 employee trainees
and 25 trainer-trainees.
Other programmes include a Scholarship Programme in Hong Kong - Special
Administrative Region of China -f o raM a s t e ro fL a wi nH u m a nR i g h t sa tt h e
University of Hong Kong, three Co-operation Programmes ongoing in Macau -
Special Administrative Region of China , and a new programme on co-operation in
the legal sector launched at the end of 2001, with a total EC contribution of €
990.000.
167– Programme in the field ofInformation Technologies
TheAsia IT&C Programme commenced in October 1999. The aim of the
Programme is to increase co-operation in information technology and
communications between Europe and participating Asian countries/territories. China
became a participating country in 2001. In 2001, 23 projects were approved ( €5.98
million) for projects that search for compatible IT&C solutions between Asian and
European IT&C environments, improve the transfer of IT&C know-how, and
strengthen the mutualunderstanding of IT&C regulatory and/or legislative structures
between the regions.
Private Sector andEconomic Development Commitments 2001 ( €million)
Country Project Title Amount
India Small ProjectsFacility 4.04
Vietnam EBIC 0.99
China Intellectual PropertyRights (Addendum) 0.80
Vietnam Human Resources/Tourism 10.80
Vietnam Audio-visual 0.95
Macao Co-operation in thelegal field 0.99
China WTO (Addendum) 0.60
China Interpreter training 0.40
Asia Extension toIT&C Program 5.00
TOTAL 24.57
4.6.7. Social Services : Health andEducation
4.6.7.1. Health
There are a number of social and economic challenges that stem from poverty, social
change, economic growth and crisis, and under-funding of the health sector. There is
also a health challenge in Asia, which is characterised by a rapid “Health transition”:
demographic transition, changing risks of environment and lifestyle, epidemiologicaltransition and a widening gap of health status between social and economic classes.
Furthermore, the region is prone to naturaland man-made disasters.
The EC response to these challenges under the health sector development programme
in2001 has focused mainlyonthe following priorities:
–I nThailand, the Health Reform Project (
€2 million) which was completed in
2001, assisted the Government of Thailand to achieve universal coverage,
decentralisation and Civil Society involvement to improve responsiveness and
quality of care. Following this positive experience of European support to the
healthsector reforminThailand, a second programme ( €5 million) is due to be
committed in 2002. In Vietnam, the on-going Health Systems Development
Programme in Vietnam (1998-2003, €34 million) aims at improving the
qualityofand access to primaryhealthcare.
–Even larger EC interventions respond to a variety of sector challenges.
They are increasingly implemented through sector wide approaches and
budget support. InBangladesh , the Healthand Population Sector Programme
1681998-2003 ( €70 million) responds to a large reform agenda unifying health
and family planning services. The programme has been agreed between EC,
World Bank and other donors. The sector programme has made good progress
in its first two and a half years. Significant improvement in most health
indicators continued to be made (e.g. infant mortality down to 62 (2000) from
92 per thousand (1992-6), and Maternal Mortality Ratio (MMR) down below
400 (estimate 2001) from485 (1991). Onthe reform agenda, progress has been
more mixed and efforts to push through unification were hampered in thecontext ofnationalelections and transitionto a new government.
–I n India,EC support to the Health and Family Welfare Sector Reform
Programme (
€200 million) aims to improve the quality and accessibility of
health services, with particular focus on the status of women’s and children’s
health. Currently 22 states have adhered to the process of reform (from 11
originally participating) and close to 40 NGOs and institutions are assisting in
the implementation of the reform. After the January 2001 earthquake in
Gujarat, the EC increased its contribution by €40 million to support
reconstructionand rehabilitation efforts, and maintain the momentumofsector
reforms.
–Strengthening Social Security Systems and Social Health Insurance .
European experience in Social Security and Social health Insurance can be of
particular value for countries aiming to reduce the vulnerability of people who
a r ecl os et oth ep ov e r tyl i n e .I n Chinain2001 the EC started the preparation of
a major programme ( €20 million) for Social Security that is expected to be
committed in 2002. In Indonesia a small programme for policy advice on
SocialHealthInsurance was financed fromthe 2001budget.
–Addressing the unfinished agenda of epidemiological and demographic
transition in terms of poverty-related burden of disease: maternal
mortality, communicable diseases.
TheAsia Initiative for Reproductive Health , implemented by UNFPA, aims at
implementing the recommendations of the Cairo Conference on Population and
Development 1994. Operating in Pakistan, Nepal, Sri Lanka, Bangladesh, Vietnam,
Lao PDR and Cambodia through 42 NGO projects (including 3 regional dimension
projects) the AIRH offers a variety of services in sexual and reproductive health,with emphasis on women and adolescents. In Vietnam, for example, the
implementing NGOs were trained in “Reproductive Health for All: taking account of
Power Dynamics between Men and Women”.
In 2001, the Commission extended the programme to 31 December 2002. Progress
and results achieved for each of the 42 projects are provided in detail in the Annual
Report 2001
113.
Programme activity in Cambodia, include: upgrading 4 conventional reproductive
health clinic facilities; workshops for more than 145,000 adolescents; more than
38,000 visits were made to youth centres and libraries; and youth friendly services inclinics for 30,000 youths. This is the first time in Cambodia that a project has been
113http://www.asia-initiative.org/annual_report_2001.html
169able to gather together parents, teachers, community leaders and the young at the
same table to break the silence surrounding adolescent sexuality.
The regional Malaria ControlProgramme for Lao PDR114,Cambodia and Vietnam
aims to decrease malaria incidence, morbidity and mortality. The programme has
been particularly successful in promoting impregnated bed nets in these three
countries, and in improving immediate treatment of cases through an effective pre-
packed combinationofanti-malarialdrugs. In 2001, the EC agreed to an extension of
the programme untilDecember 2002
In 2001, the EC also pledged €60 million for the newlycreated Global Fund to Fight
AIDS, TB and Malaria and endorsed a Communication115on the Implementation of
the ActionProgramme against these three major communicable diseases .
–Responding to natural and man-made disasters, post-conflict
rehabilitation andtransition todevelopment .
As already indicated, the Commission has reacted quickly to the earthquake in
Gujarat by increasing its budget support in the India health sector programme by €
40 million. Although physical rehabilitation of infrastructure will form an importantpart of the aid package, assistance to Gujarat will also focus on improving quality of
reproductive health services through reform, in line with the sector reform
programme so far implemented in India .
The Commission also believes in a continuum ofpost-conflict rehabilitation towards
development and has pioneered an innovative sector-wide approach in East Timor
together with other donors (i.e. World Bank, Portugal, AusAid, Brazil, JICA). Since
its establishment in early 2000, the multi-donor co-operation programme channelled
through the Trust Fund for East Timor (TFET) has helped achieve fast social and
economic recoveryin East Timor.
TFET will help support the implementation ofthe plan by: (i) continuing to focus on
completing basic capital reconstruction needs in the economic and social sectors in
the first year after independence as Government faces the difficult tasks of assuming
functions previously held by UNTAET (United Nations Transitional Authority for
East Timor), providing continued service delivery, and addressing urgent legal and
institutional actions; (ii) helping to build capacity in development project design and
management, in order to assist Government in executing a larger development
programme through its centralbudget afterthe TFET winds down.
4.6.7.2. Education
The year 2001 has been important for EC support to education development in Asia,
with two significant features. Firstly, the EC’s commitment to support countries,
particularly the least developed countries, in fulfilling the Education for All agenda
and goals, has been sustained. Secondly, the shift from individual, output-oriented
projects to more strategic interventions that help to pave the way to sector
approaches ineducation has gained further momentum.
114People'sDemocraticRepublicofLao
115COM (2000) 585 Final
170InBangladesh the following new commitments were made:
–IDEAL( €20.3 million): the key objectives are to improve access to and
quality of education in over 10,000 primary schools in 10 of Bangladesh’s 64
districts. Approximately 2.5 million children and 40,000 teachers will benefit
from support to improve their classroom environment, the quality of teachingand learning, learning assessment. The project also provides support to school
mapping and planning as wellas to schoolmanagement committees.
–BRACN o nF o r m a lE d u c a t i o n(
€23 million): the aim is to contribute to
poverty alleviation through providing access to non-formal primary education
for approximately 1.6 million children traditionally outside formal schooling
(especially girls; 60% of enrolment), and to contribute to the strengthening of
the national education system. The project supports staff and teacher training,
improvement ofcurricula and learning materials as wellas classroomprocesses.
EC support also enables BRAC to expand its services to improve literacy and
other basic life-improvement skills among particularlypoor adults.
InIndiathe EC signed a financing agreement to support the Sarva Shiksha
Abhiyan, the national sector-wide programme of the Government of India aimed at
promoting a people’s movement for universal elementaryeducation. EC sector-based
support will enable Central and State Governments to intensify their efforts to
provide access to basic education(formalor non-formal) to allchildren between 6-14
years by 2003; ensure that all children complete 5 years of primary schooling by
2007 and 8 years of elementary schooling by 2010; improve quality of elementary
education to a satisfactory level by 2010 for all children; close gender and other
social category gaps impeding access to primary education by 2007 and to
elementaryeducationby2010.
171Evaluation results of project inIndia-
ECSupport toDistrictPrimaryEducationDevelopment ( €150 million)
Principal achievements
–Quantitative targets116were all met and in some cases exceeded, while additional
activities havetakenplaceand achievedexcellent tangibleresults
–In the two states that have benefited most from the EC grant (Madhya Pradesh and
Chhattisgarh), DPEP objectives were almost completely achieved in terms of increased
access and enrolment, reduction of drop-out and gender/social disparities, improved
learning outcomes, and enhanced planning and management capacity117. Adult literacy
ratesalsoshowed substantial improvement over the period of the programme.118
–The impact of the programme on the wider education system has been satisfactory. Some
improvements have been brought about in classroom practice; and management
processes across the states in the education sector, and in other sectors, are becoming
more output-orientedandparticipative.
–The programme hasproved overall tobe both technically andfinanciallysustainable .
Keylessons for future EC support toelementaryeducation in India
–The funding arrangement whereby the Government deploys the EC grant not merely to
support, but to add ambition and resou rces to sector interventions in elementary
educationat Statelevel, hasprovedeffective.
–Release of EC funds in advance, rather than as reimbursement of expenditure, has
brought benefits in terms of financial security, flexibility in expenditure and
opportunities for innovation.
–Moreattentionwasgiventoimproving accessratherthanaccessandquality.
–The impact of support to capacity building, technical assistance, monitoring and
evaluation can be significantlyenhanced with better planning and consensus building .
Some important policyissuesfacing the development of elementaryeducation
116The principal targets of DPEP were: (i) to reduce differences in enrolment, dropout and learning
achievement among gender and social groups to less than 5%; (ii) to reduce overall primary school
dropout rates to less than 10%; (iii) to raise average achievement levels by at least 25% over measuredbaseline levels; (iv) to provide 100% a ccess to primary education; (v) to strengthen national, state and
district level capacityin the planning, management and evaluation of primaryeducation.
117The gross access ratio for primaryschooling rose from an average of 77.4% in 1996 to 100% in 1999 in
Madhya Pradesh and from 86.4% in 1996 to 98% in 2001 in Chhattisgarh. The gross enrolment ratio( G E R )o f6 - 1 1y e a ro l d si nC l a s s e s1 - 5i n c r e a s e df r o m7 6 . 7 %t o9 6 . 5 %i nM a d h y aP r a d e s ha n df r o m88%to101.5%in Chhattisgarh.Thedropoutratein primaryschools hasbeen reduced to less than 10%,with the reduction in dropout being higher among girls. Gender and social disparities in primaryeducation enrolment have been reduced to less than 5% in DPEP-I districts in both states. The equityindex in Madhya Pradesh primary school GER has risen for girls, scheduled caste (SC) and scheduled
tribe(ST) children to 97.3, 98.2 and 99.8respectively. In Chhattisgarh the social disparities, in termsof
enrolment, have been reduced from 12.7% in 1996 to 1.2% in 2000 between the STs and other groups,and from 7.3% to 1.5% between the SCs and other groups. The gender enrolment disparity has beenreduced from 7.8% in 1996 to 2.7% in 2000. In the baseline, mid-term and terminal achievementstudies tests district-wise improvements in Madhya Pradesh ranged from 5.8% to 51.8% in Class 1language and from 12.5% to 54.3% in Class 1 mathematics, with similar ranges in Class 4. Similarimprovements in achievementhave been noted in Chhattisgarh.
118Adult (15+ years) literacy rates in Madhya Pradesh are estimated to have increased over the last decadefrom 44.2% in 1991 to 64.1% in 2001 – a rate of increase which is over 50% higher than the nationalrate.
172–Financial ceilingsfor expenditure on teachers’salaries.
–Measuresat statelevel torationalise the teachingforce.
–Medium to long term implications of differential teacher salaries in terms of cost-
effectivenessandequity.
–The costs and professional linkages between pre-service and in-service training of
primaryand upper primaryteachers.
–The issue of school contingency funds and expenditure on qualityinputs.
InChina,t h eE Cl a u n c h e da €15 million basic education project to support the
Gansu Provincial Government in modernising and improving teacher training, in
strengthening management and institutionalcapacityfor basic education in poor rural
counties of Gansu Province, as well as with research and dissemination of promising
innovative approaches and methods in basic education.
EC co-operation with Asia in education: driving principles
EC co-operation in education in Asia has continued to build on the following key
principles during 2001 :
–Concentration and pooling of resources : Sector- and policy-driven
interventions inthe educationsector, like in most other social sectors, generally
require a critical mass of resources. EC co-operation resources being limited,
the risk of spreading resources too thinly is significant. Beneficiary countriesare therefore asked to establish clear priorities – see table Co-operation with
otherDonorsintheRegion.
–Promoting universal access to basic education as a means of maximising
impact on poverty reduction and closing gender gaps .Formal versus non-
formal education . Sector wide approaches focus attention on the important
role which public-private partnerships can play in promoting access to basic
quality education for all. Where formal provision of basic education services
remain weak, the strategy should be to sustain both formal and non-formal
education and, at the same time, to develop productive linkages between them.
This strategy is being pursued in Country Strategy Papers (CSPs) and National
Indicative Programmes (NIPs) as well as in the pipeline of new and ongoing
programmes. There is a strong link between basic education and improvement
in levels of human wellbeing, especially with regard to life expectancy, infant
mortality, nutritional status of children, and also the fostering of gender equity
and equality of opportunity. As enrolment and completion figures for girls in
primary education generally lag behind those of boys, promoting EFA goals
often requires special efforts towards girls. Development of human resources
through universal basic education also contributes significantly to economic
progress.
–Sustaining service delivery and reform . The policy environment and
conditions for sector-based interventions in basic education may be more
advanced in some countries (India) than in others (Bangladesh, Cambodia, Lao
PDR).
173Helping Pakistancope withtheeffectsof theAfghanconflict
As a contribution to the support given to Pakistan by the international community during the
Afghan crisis, the Commission undertook to examine ways of further assisting the reform
efforts of the Pakistani Government. This was achieved in part by modifying the procedures of
the Social Action Programme Project (SAPP II) in order to grant direct budget support to the
Government against reform process indicators in the Education and Health sectors. The
Commission had made a firstpaymentinstalment of €15.5million by the end of 2001 under this
new Project mechanism, and the last disbursement, for the same amount, is anticipated by mid-
2002, bringingECintervention in SAPPII toa close.
Moreover, needs and the policy environment may change, due to factors beyond the control of
the Government (e.g. Pakistan). EC support must therefore be tailored to the education
situation in each country and remain sufficiently flexible to enable countries to face new
challenges.
4.6.7.3. Programmes inthe Field ofHigher Education
EC programmes and projects in the higher education sector pursue the objective of
developing high quality human resources in the partner countries and the EC. In
addition, they help promote Europe as a world -wide centre of excellence for study
and training. These objectives follow the priorities outlined in the Commission
C o m m u n i c a t i o no nh i g h e re d u c a t i o nc o - o p e r a t i o nw i t ht h i r dc o u n t r i e s119,t h a td r a w s
uponthe positive experience gained inthe framework of intra-Communityexchangesunder the SOCRATES/ERASMUS programme.
In 2001, the EC continued to support bilateral European Studies Programmes in
India, Malaysia, China, Pakistan and Vietnam (around
€2 million). In addition, the
EC prepared a large-scale second phase of the European Studies Centres Programme
China.
The regional Postgraduate Technological Studies Programme (PTS) implemented
at the Asian Institute of Technology (AIT) in Bangkok continued to receive EC
support. The project was increased to around €2.7 million and extended to
December 2002. This allowed the PTS to reach the five-year target of recruiting 90
Asianand 90 Europeanpostgraduateexchange students.
In addition, the Commission has made preparations for the launch of the €7 million
ASEAN-EU University NetworkProgramme (AUNP).
4.6.7.4. Culture
TheAsia-Europe Foundation (ASEF) established in 1997 in Singapore in the
ASEM framework, continued to receive EC support in 2001. EC support has
contributed in establishing the reputation of the Foundation as an effective and
highly reputable organisation and in enhancing its role in strengthening mutual
awareness including culturalactivities inthe two regions. Since its inception in 1997,
ASEF has set up some 80 separate projects with approximately 4500 participants.
The EC has been financially involved inclose to half ofthese projects.
TheEU-India Economic Cross Cultural Programme (EIECP) underwent a mid-
term evaluation in 2001. The evaluation confirmed the relevance of the programme
119COM (2001) 385 final18 July2001
174and the overall project design. In addition, the evaluation proposed a number of
measures in order to improve the management of the programme. On this basis, the
Commission decided to propose to extend the existing Memorandum of
Understanding and to re-launch the programme in 2002 in the framework of a de-
concentrated management model.
Socialdevelopment – Commitments 2001 ( €million)
Sector Country Title Amount
Health India Healthsupport 40.0
Health India SCALE 25.8
Education India EUStudies (Nehru University) 0.60
Health Indonesia HealthInsurance 0.5
Education Bangladesh BRAC/NFPE III 23.0
Education Bangladesh IDEAL 23.3
Education Bangladesh IDEAL 20.3
Health Bangladesh BRAC 28.7
Health Asia Malaria 3.2
Education Asia PTSAddendum(Post GraduateTechnical
Studies)0.30
TOTAL 165.7
4.6.8. Cross-Cutting Issues
4.6.8.1. EuropeanInitiative for Democracyand HumanRights
In 2001 the European Initiative for Democracy and Human Rights committed €
10.81 million for projects in Asia and the ASEAN region. This support was
principallyfor :
– PromotionanddefenceofHumanRightsand fundamentalfreedoms;
– DemocratisationprocessandstrengtheningoftheruleofLaw;
– Conflict prevention and restoration of law and order;
– Transitionto democracyand electoralobservation.
4.6.8.2. NGOs Activities
The EC co-financed 51 projects with NGOs in Asia amounting €36.74 million,
which represents about 22% of the budgetary line available for co-financing with
NGOs (B7-600). The bulk of projects co-financed capacity building, health and
sanitationaswellasruraldevelopment.
1754.6.8.3. Tropical Forests &Environment
Tropical Forest
T h ec o s to ff o r e s tf i r e s
In Indonesia forests are disappearing at an alarming rate as a result of more than three decades
of uncontrolled exploitation. Recent studies indicate that the remaining forests will disappear
within 10 to 15 years if the current rate of deforestation is not halted. The main reasons for
deforestation are unsustainable logging practices, including illegal logging, and the large scale
conversion of forest toplantations, whichis oftenat the origin of uncontrolled, devastatingfires.
The fire disaster that took place in Indonesia in 1997 attracted much international attention.
Economists estimated that the smoke haze alone cost at least €1.5 billion in health treatment
and lost tourism revenues. Furthermore, the 1997 fires (total area affected calculated at 9.7
million hectares) were estimated to have resulted in over €3 billion of additional damage from
losses in timber, agriculture, non-timber forest products, hydrological and soil conservation
services, etc. These are conservative estimates, since the indirect costs of carbon release into the
atmosphere andadditional long-termhealth costs of the smoke haze are notincluded.
The EC has recognised the role of tropical forests in global environment and the
importance of their preservation for long term sustainable development. In Asia,
forests are important economically, socially and environmentally. Further, they are of
global importance in relation to environmental stability, atmospheric carbon
sequestration, biodiversity conservation, climate regulation and the preservation of
indigenous peoples’rights and cultures. In particular, Asian forests are considered to
be amongst the richest in biodiversity and yet are possibly amongst the most
threatened.
The ALA Regulation120includes environment and natural resources preservation
among its long term priorities. Under the ALA financial instrument some new
projects aimed at the conservation and sustainable management of forests in Asia
were startedduring 2001.
As part of the EC-Indonesia Forest Programme , comprised of six on-going
projects, the new South Sumatra Forest Fire Management Project ( €8.5 million)
was committed in 2001, to address the specific issue of forest and land fires. Its
objective is to facilitate the establishment of fire management systems at provincial,
district, sub-district and village levels throughout South Sumatra. A Financing
Agreement for €2 million was signed in 2001 for an Illegal Logging Response
Centrethe aim of which is to support the Ministry of Forestry to combat illegal
logging. The EC-Indonesia Forest Programme is comprised ofongoing projects for a
total EC commitment of over €100 million and is addressing the key issues of
conservation, sustainable management and institutionalstrengthening. These projects
contributeto the conservationand sustainable management ofover 2 million hectares
of tropical forests in various parts of Indonesia and provide training for several
hundred people in various sectors spanning from sustainable forest management and
mapping to fire prevention and satellite imagery interpretation. Thanks to the
achievements of these projects the EC is now firmly established as the major donor
120Council Regulation (EC) No. 443/92 of 25 February 1992 on financial and technical assistance to, and
co-operation with, the developing countries in Asia and Latin America published in OJ L52, 27th
February1992.
176in the forest sector in Indonesia and is regarded as an essential key player in the
politicaldialogue taking place inthe country’s forestrysector.
The EC committed €16.9 million in 2001 for the “Natural Forest Management
Project” in Chinato assist the Government’s Natural Forest Protection Programme
(NFPP) which introduced a ban on logging in natural forests. This is EC’s first major
project inthis field in China. The project was prepared together with the World Bank
as a part of a Sustainable Forestry Development Programme ,f u n d e da l s ob yt h e
GlobalEnvironment Facilityand the World Bank.
EnvironmentASIA-EcoBest and EU-Asia Pro-ECO Programmes
Since 1997, Asia-EcoBest (AEB) has promoted European environmental best
practices and business in Asia, operating through the autonomous Singapore-based
Regional Institute of Environmental Technology (RIET). The Asia EcoBest project
(which ended in March 2002) planned to spend around
€1.4 million under the work
programme 2001.
Around €0.7 million were disbursed on supporting 18 external project proposals
from a total of 40 applications received. In particular ten seminars, training courses
and roundtables took place in China, India, Nepal, Philippines and Vietnam. These
had around 650 participants, 7 studies undertaken (including 2 public presentations
ofproject results) and 1 facilitydevelopment project.
RIET spent in addition around €0.7 million for 3 conferences in China, Singapore
and Thailand (400 European and Regional Participants); exhibition pavilions and
business to business meetings in India, Malaysia, Singapore and Thailand with
participation of 50 European companies; preparing and marketing comprehensive
reportsonAsia EcoBest projects 1998-2002 .
AEB was instrumental in raising awareness of Asian environmental issues amongbusiness representatives, in particular from SMEs, in Asia. It is expected that AEB
support from EC will trigger additional trade with, and investment from, Europe in
the mediumterm.
A new programme for environmental economic co-operation EU-Asia Pro-Eco was
approved in December 2001. The overall objectives of this new programme are: (i)
improved environmental quality including a positive influence on global climate
change with the view to ‘a cleaner Asia’, and health conditions (ii) long term
sustainable investment and trade between EU and Asia and (iii) an improved
environmentalperformance in economic sectors. The purpose of EU-Asia Pro Eco is
to foster the adoption of policies, technologies, and practices that promote cleaner,
more resource-efficient, sustainable solutions to environmentalproblems in Asia.
EU-Asia Pro Eco comprises an enabling operational and practical dialogue, and
provides support through grants for Policy reinforcement ;Diagnostic studies ;
Technology Partnership, andDemonstration activities. The first Call for Proposals is
expected in January 2003, with wide interest expected. The total EC budget is
€35
million.
177In the field of biodiversity conservation , apart from the direct impact of the
individual forestry projects, the Commission has promoted the creation of the
ASEAN Regional Centre for Biodiversity Conservation .T h i sp r o j e c t ,t ow h i c h
the Commission is contributing €8.5 million, started in 1999 and is based in Manila,
Philippines, and is matched with a network of national Biodiversity Units in the
Asean Countries. It aims at intensifying biodiversity conservation in the Asean
Region through improved co-operation. This project thus contributes not only to
biodiversityconservationbut also to regionalintegration.
Environment, Energy, Forestry - Commitments 2001 ( €million)
Country Title Amount
China Energy/Environment 20.0
China NaturalForestry 16.9
Indonesia ForestFireProtection -phase2 8.5
TOTAL 45.4
4.6.9. Coherence with other policies
The EuropeAid Co-operation Office ensures coherence with other EC policies to a
high degree and this is particularly evident in the trade field, as well as in relation to
EU policies on the environment and povertyalleviation.
The Framework Programme for EU support to China’s accession to the WTO was
extended and funding was increased in 2001 - while in Vietnam, the Multilateral
Trade Policy Assistance Programme is under implementation. The assistance of the
EC enables developing countries to better participate in the multilateral trade system
and thereby improve its functioning, which in turn benefits the EU and its citizens.
The related Intellectual Property Rights (IPR) programmes are managed in line with
the EC policies, too. In the environmental economic co-operation, the Asia-EcoBest
programme was implemented by the Regional Institute of Environmental
Technologies (RIET) based in Singapore. Relevant services of the Commission were
systematically consulted to ensure full consistency of RIET action with other EC
policies.
The concepts ofthe various projects and regional programmes in the Asia region are
consistent with the Communication from the Commission “Strategic Framework for
Enhanced Partnerships”121, prepared in April 2001. It is clear that the range of
projects implemented should strengthen the political and economic presence of the
EUacrosstheregion
4.6.10. Co-operation with Other Donors in the Region
In the context ofDonor Co-operation, the table below lists the countries in Asia that
have identified education as a priority for co-operation. Furthermore, to help build
the critical mass of resources and the policydialogue and coherence that are required
for sector approaches in education, a systematic effort is made to pool EC and other
donor resources, particularlywithMember States.
121“Europeand Asia- AStrategicFramework for Enhanced Partnership”doc. COM(2001)469 adopted by
the Commission on September 4th, 2001, subsequently adopted by the Council of Ministers by written
procedureon 27th, December 2001.
178Country Priority List ofcountries Pooling of ECresourcesintheeducationsector
Bangladesh AsDB, UNICEF, DFID, NL, CIDA
CambodiaCountries wherebasic
education isapriorityfor EC China WB, DFID, NL
India
Indonesia
Laos WB, DANIDA, NORAD, FINIDA
Nepal AsDB, WB, SIDA
Pakistan WB, AsDB, DFID, NL
Vietnam
4.6.11. EIB Loans –2001
The European Investment Bank (EIB) participates actively in EU co-operation
policies in Asia. Through its lending policies it supports projects of mutualeconomic
interest. Funding is provided by the budget of the European Union and/or the
Member States, and its aim is to optimise the benefits accruing to beneficiary
populations .
EIB Loans 2001 ( €million)
Loan Type Country Project Title Amount
of loan
ManufacturingIndustry Philippines PhilipsSemiconductor 93.3
Transport/Communications China Guangxiroadsdevelopment 56.1
Global loan Indonesia Rabobank Indonesia GL 28.1
TOTAL 177.5
4.6.12. ECHO
In2001, ECHOreactedand responded quicklyto two major disasters in India as well
asthe significant humanitarianand reconstructionchallenges following the liberation
of Afghanistan122. Total ECHO assistance to countries in Asia in 2001 reached €
104.3 million.
InIndia, emergency assistance was provided for the victims of the Gujarat
earthquake in January for temporary shelters such as tents, with a mobile field
hospitalalso being provided. In July, ECHO provided emergency food and non-food
aid forthoseaffectedbythe floods inOrissa(total: €14.602million).
InAfghanistan major operations ( €54.7 million) were addressed towards drought
affected populationand IDPs through food security, health activities and provision of
shelters mainly supporting the most vulnerable people affected by the post 11
September reaction.
InNepalan important action of food relief ( €2 million) was addressed to 100.000
Buthanese refugees, and in BurmaECHO continued to support the most vulnerable
populationand ethnic minorities affected bypoliticalisolationand discrimination.
ECHO continued to be deeply involved in reconstruction in East Timor ( €11.274
million), mainly for projects to improve water, sanitation and healthcare services. By
virtue of relative stability in the country, confirmed by National Independence in
122Viz. Afghanistan - Starting a RecoveryProgramme page…..
179May 2002, the focus is shifting from relief operations towards rehabilitation and
development. ECHO is expected to phase out its operations there inthe end of2002.
In addition, in the framework of its regional Disaster Preparedness Programme
(DIPECHO ), ECHO has approved a first Action Plan for South Asia amounting €
3.2 million. This Plan aims at addressing local communities’ vulnerability to
flooding. In 2001 as well, the projects totalling €4 million approved the year before
within the second DIPECHO action Plan for Southeast Asia were under
implementation.
The table below indicates the decisions taken in 2001 by ECHO as a humanitarian
response to the specific needs ofeachofthese countries in Asia.
ECHOFinancialDecisions 2001 ( €million)
ECHO HumanitarianAid
Country ProjectTitle Amount
Afghanistan
andneighbouring
countries- Food aid
-AssistancetoIDPs andreturnees
-Air transportation for access54.680
India Emergencyrelief,temporaryshelterandmedicalcaretothe victims ofthe
Gujaratearthquakeandthefloods inOrissa14.602
East Timor Improvement of water sanitation systems and health services 11.274
Cambodia - Basic medical health, water and sanitation, and small-scale mine
clearance;
-Emergencyassistanceto25,000familiesaffectedbydrought4.900
Thailand ImprovingconditionsofBurmese Refugeeslivingin campsontheThai-
Burmeseborder4.500
North Korea -AssistancetothePrimaryHealth CareSystem
-Supplychildren’s clothes-Supplyofreliefitemstoflood victims3.365
Indonesia Assistancetovictimsoflocal ethnicconflictsintheMoluccas and East
Timor2.200
China Assistancetothevictimsofnaturaldisastersinthe Guangxiprovince andin
Inner Mongolia2.150
Nepal Provision ofbasicfood toBhutaneseRefugees 2.000
Myanmar/Burma AssistancetoIDP’s *(SanitationandHealth)andPrisonersprotection 1.990
Philippines -Assistancetothevictimsofconflict inMindanao
-Assistancetothevictimsofthestorm“Lingling”1.460
SriLanka AssistancetothevictimsofthecivilwarinJaffna 0.700
Vietnam EmergencyAssistancetothe victimsofthefloods 0.533
SUB-TOTAL 104.354
DIPECHO Programme (Disaster Preparedness Programme)
South Asia First DIPECHO Action Planfor SouthAsia 3.200
TOTAL 107.554
*IDP’s:InternallyDisplacedPersons.
4.6.13. Monitoring
The Commission, in the course of 2000, conceived an improved results-oriented
monitoring system for the ALA/MED/ACP and Balkan regions, which is rooted in
the Commission’s Project Cycle Management method. The system was tested during
2001. The conception and test-phase have been completed and the paragraph below
describes the first tentative but interesting insights on what works and what can be
improved in Asia. Additional information on the results-oriented monitoring system
180can be found in Chapter Monitoring. The system will be applied for all EC projects
as of2002.
During 2001, 78 projects (of which 9 have been re-monitored) have been visited in
this region, in 12 countries. The total volume of EC financing thus covered is €
1,006.4 million of which the most important sector were health (31%) and education(8%). The overall rating for projects in the region was 2.77, compared to an average
noteof2.5.
Effectiveness and impact are the relatively most successful aspects. The highest
ratings at sub-criteria level are attributed to environmental and technical adequacy,
secondary effects of results, and wider unplanned effects. The weakest areas are
input timeliness and economic adequacy.
As explained in the chapter on monitoring, the results of the regional analysis of
levels of project performance should be treated with great prudence. At best, it may
provide orientation for the preparation of further, more in-depth investigations into
the natureofproject performance inspecific regions.
4.6.14. Conclusions and Perspectives
The European Commission (EC) first set out an overall framework for EC relations
with Asian countries in its 1994 Communication "Towards a New Asia Strategy". In
September 2001, the EC adopted a new Communication
123updating that strategy,
taking account of key developments in the intervening years, and establishing a
comprehensive strategic framework for EC relations with Asia, and its sub-regions,
inthe coming decade .
Inparticular, theEUshouldstriveto:
– contribute to peace and security in the region and globally, through a
broadening ofour engagement withthe region;
– further strengthenourmutualtrade and investment flows withthe region;
– promote the development of the less prosperous countries of the region,
addressing the root causes ofpoverty;
– contribute to the protection of Human Rights and to the spreading of
democracy, good governance and the rule of law;
– build global partnerships and alliances with Asian countries, in appropriate
international fora, to help address both the challenges and the opportunities
offered by globalisation and to strengthen our joint efforts on global
environmentaland securityissues;
– and help strengthen the awareness ofEurope in Asia (and vice versa).
123“Europeand Asia- AStrategicFramework for Enhanced Partnership”doc. COM(2001)469 adopted by
the Commission on September 4th, 2001, subsequently adopted by the Council of Ministers by written
procedureon 27th, December 2001.
181In conclusion, the Communication stresses that Asia is a crucial economic and
political partner for Europe. More than ever before, the EU and its Asian partners
should work together in addressing the globalchallenges which we both face, and the
globalopportunitieswhichweshouldallbeableto share .
1824.7. Latin America
The key to the Community's approach to Latin America is its recognition of Latin America's
diversity and the need to tailor dialogue and co-operation to regional and national
circumstances. In recent years both the European Union and Latin America have tried to
develop a more comprehensive relationship through a strategic partnership to achieve
common political, economic and social objectives and acquiring more weight in matters of
mutual interest in the globalisation process, while maintaining their specific character.124
Development co-operation is anessentialdimensionofthis strategic partnership, as shown bythe ever greater number ofregionalinitiatives in2001.
4.7.1. Introduction
Co-operation Agreementsand Memoranda ofUnderstanding
LatinAmerica: sub regionsandcountries125
Central America (A) AndeanCommunity (C) Mercosur( A) (C) Others
Costa Rica (A) Colombia Argentina (A) Chile(A)(C)
El Salvador (A) Ecuador (A) Brazil(B) Mexico (B)(C)
Guatemala (A)P e r u (B) Paraguay (A)
Honduras (A) Bolivia (A) Uruguay (A)
Nicaragua (A) Venezuela (A)
Panama (A)
(A) Memorandum ofunderstandingsignedin 2001.
(B)Memorandumofunderstandinginnegotiation.(C) Agreements on frameworks of co-operation inter regional signed up to 2001
The countries of Latin America are broadly faced with three major challenges:
dealing with poverty and inequality, notably by increasing social solidarity;
consolidating the rule of law and ensuring the irreversibility of the democratic
process; integrating into the world economy by pursuing economic reform and
increasing internationalcompetitiveness.
Efforts to reduce poverty in Latin America are affected by the region's tremendous
geographical and demographic contrasts. The urbanisation rate is expected to rise
from75% to 79% by2020 (highest rates in Argentina, Brazil, Chile, Colombia, Peru
and Uruguay), a factor that the EU takes into account in its co-operation
programmes.
The bulk of EU financing for Latin American countries is governed by Council
Regulation (EEC) No 443/92 of 25 February 1992 on financial and technical
assistance to, and economic co-operation with, the developing countries in Asia and
124COM(2000) 670 "Follow-up to the First Summit organised between Latin America, the Caribbean and
the European Union".
125Latin America has distinct subregions: Central America, the Andean Community and Mercosur, towhich ChileandMexicoareattached.
183LatinAmerica.126There is also financing for aid to uprooted people in Latin America
and for rehabilitation and reconstruction operations under Regulation (EC)
No 2130/2001 of the Council and Parliament and Council Regulation (EC)
No 2258/1996respectively.
Despite its immense economic potential, Latin America still faces important
challenges. The average per capita GDP of the region was USD 3800 in 1999; the
difference betweenthe countries is on a scale of 1 to 15 (USD 430 for Nicaragua and
USD 6180 for Uruguay). Wealth is unequally distributed, which makes for difficult
access to healthcare, educationand socialsecurity.
A variety of regional integration processes are under way in Latin America. They
have gone hand in hand with the increase in the number of free trade agreements,
which has boosted trade between the countries in the region, so contributing to
economic growth and development.
The European Union and its Member States are the leading source of grant aid to
LatinAmerica.
Commitments and Payments in 2000 and 2001(except theBA* and Cuba lines)
PROGRAMMES COMMITMENTS PAYMENTS
LINESB7-310/311 2001 2000 2001 2000
COUNTRY/BILATERAL
Argentina 9.910.000 7.207.145 5.674.145
Bolivia 25.000.000 4.069.269 11.069.999
Brazil 2.350.000 10.304.190 5.354.877 3.565.615
Chile 9.000.000 5.791.622 1.795.894
Colombia 34.800.000 4.891.196 2.841.411
Costa Rica 9.600.000 575.777 589.328
Ecuador 11.000.000 2.465.667 3.457.072
Guatemala 16.150.000 14.101.002 16.365.748
Honduras 5.023.666 9.035.130
Mexico 764.630 1.480.430
Nicaragua 10.900.000 5.000.000 11.760.063 15.985.406
Panama 8.650.000 2.933.167 3.278.359
Peru 6.575.250 10.963.918
Paraguay 7.642.593 4.423.313
El Salvador 28.942.500 5.976.710 9.367.046
Uruguay 900.000 1.320.000 1.626.845 2.150.271
Venezuela 10.000.000 2.298.333 3.697.053
BILATERAL
SUBTOTAL133.292.500 60.534.190 84.647.812
REGIONAL
SUBTOTAL84.373.500 163.310.000
Other
(mainlyfor regionalprogrammes)35.394.789 72.260.228
TOTAL
BILATERAL/
REGIONAL217.666.000 223.844.190 124.452.601 178.000.366
126There was no change in the legal framework for co-operation with Latin America in 2001. The
Commission has drawn up a new draft Regulation for Latin America, which will be presented to theCollegefor approval in 2002.
184*The BA line covers expenditure on administration, especially concerning the
devolutionofprogramme management to the Delegations.
The EU co-operation budget for this region has stood at approximately €500 million
a year since 1996. This figure includes commitments under budget lines B7-310
(financial and technical co-operation), B7-311 (economic co-operation), B7-312
(refugees and uprooted people) and B7-313 (rehabilitation), which are specific to
Latin America, plus other important non-geographical budget lines, such as Human
Rights, foodsecurityandNGOcofinancing.
€96.6millionwas decommitted in 2001 as part ofthe effort to reduce the backlog of
outstandingcommitments(RAL);thisaffected143commitments.
Budgetlines B7-310(financialandtechnicalco-operation) andB7-311
(economic co-operation) in €million
1995 19961997199819992000 * 2001** Total
Commitments 287.6 262.8 254.1 240.9 104.4 229.7 231.6 1611.1
Payments 145.7 151.9 148.8 142.8 158.7 179.5 126.3 1053.7
* IncludingCuba
** Including line BA
In 2001 the Commission's taking-over of administrative and monitoring activities
previously carried out byTechnical Assistance Offices (TAOs) did affect operations.
The process of devolving staff from headquarters to the Delegations somewhat
slowedthepaymentsratecomparedwithcommitments.
4.7.2. Regional co-operation
Regional co-operation has been stepped up in recent years to implement the
development agenda of the bi-regional strategic partnership decided by EU,
Caribbean and Latin American heads of state and government at the Rio Summit in
1999 and to support byappropriate measures the process ofregional integration.
4.7.2.1. Horizontalprogrammes
Regional co-operation has been much developed under "horizontal" programmes.
Suchprogrammes inareasofmutualinterest, which are financed in the framework of
economic co-operation, promote partnerships between networks in the two regions
(towns, companies, universities, etc.).
Major horizontal programmes, such as: ALFA, Al-Invest, Atlas, Urb-Al, Alure,
@LIS, were financed in2001.
ALFA- Latin America Academic Training. This programme promotes co-operation
between Latin American and European higher education institutions and ongoing
inter-regional and regional exchanges (whether EU-LA, LA-EU or LA-LA),
especially in engineering, medical sciences, social sciences and economics.127The
second phase started up in 2000 and will run until 2005: ALFA II is currently
running 54 projects for atotalcostof €12.45 million- the Community contributing €
127http://www.europa.eu.int/comm/europeaid/projects/alfa/index_en.htm
1858.89 million, while 104 ALFA I projects are continuing or on the point of
completion.
RESCE: Network of Social Studies -CentralAmerica-Caribbean- Europe
This network is coordinated by the University of Costa Rica and embraces the Universities of
the Sorbonne, the Hague, Salamanca, Nicaragua, El Salvador, Havana and Centroamericana de
Mexico. It has set up a "Maestria Centroamericana" (master's degree) on the basis of a
sociology research programme with a specialisation in social policy, which includes a project to
offer training to teachers and graduates of the institutions and university departments in the
network. The teaching materials produced for the training have been used for the master's
programme. Electronic mail has improved communication between network members. ALFA
sponsored the organisation of an international conference on social policy and a book has since
been published (Politicasocial:vinculoentre estadoysociedad).
AL-Invest. Commission-financed programme of decentralised co-operation to
promote meetings and partnerships between small and medium-sized enterprises
(SMEs)inbothcontinents withthe aimofboosting tradeand technologicaltransfers.
Since its launch in 1996, 250 events have been organised with the participation of
330 operators (chambers of commerce, industry associations and European
consultants) and 25 000 SMEs from both regions.128In 2001, 50 sectoral meetings
were selected for Community support, plus five ARIEL operations (Active Research
In Europe and Latin America, an instrument of the AL-Invest programme). Three of
the programme's manysuccesses are worthciting:
Furniture’00
At this meeting in Uberlandia (Brazil) a European consortium was set up to enter into a joint
venture withBrazilian partners. Thisinvolves an investment of €12 million for the building of a
factoryin the Uberlandiaindustrial zone.
Exhimoda’99
At this meeting in Mexico a Mexican firm and a Spanish firm signed a €18 million contract to
set up a jointenterprise and manufacture clothingfor the European market.
FITUR’98
At this meeting in Spain a French and a Paraguayan firm signed a €6 million contract to set up
a waste-processing plantin Paraguay; totalinvestment of over €20 million.
ATLASis a programme to support relations between European and Latin American
Chambers of Commerce; the aim is to facilitate transfers of know-how. Some 200
chambers are involved in this €2.4 million programme running over the period
2001-2003.129
Urb-AL This programme aims to establish direct and lasting relations between
European and Latin-American local authorities by promoting exchanges of
experience.130Eight thematic networks were set up initially. They have produced 65
joint projects involving about 750 local authorities (from large cities to small towns)and a hundred other local actors (NGOs, universities, companies, etc). Urb-Al
enables them to share their resources and experiences and better respond to the
128http://www.europa.eu.int/comm/europeaid/projects/al-invest/index_en.htm
129http://www.eurochambres.be/whatwedo/atlas.htm
130http://www.europa.eu.int/comm/europeaid/projects/urbal/index_en.htm
186problems caused by urban development (i.e. monitoring urban mobility, local
democracy, the urbanenvironment, etc).
As a result of the success of the first phase, which had a budget of €14 million, the
Commission allocated €50 million to the second phase (i.e. triple the budget of the
first phase). This extra financing will make it possible to launch six new thematic
networks(local financing and participatory budgets, reducing urban poverty, housing
in towns, promotion of women in the local decision-making bodies, towns and the
i nf orm ati ons oci ety ,s af etyi ntown s ).
Equitable exchanges of know-how
The Intendencia Municipal of Montevideo (Uruguay), which coordinates an Urb-AL network
made up of 150 European and Latin-American local authorities, has developed a new approach
to urban social policy based on sharing the experiences of each participant and exchanging
know-how.
This has led to 14 projects to improve the formulation and conduct of public policy in key social
sectors such as education, health, aid to disadvantaged or marginalised groups, urban
migration, domesticviolenceandpoliciestopromote anddefendwomen.
All these projects serve the same objective: an integrated approach to urban living that treats
citizens as members of interacting families, groups and communities, not isolated individuals.
The economic solidarity project, coordinated by the town of Rio Claro (Brazil) is designed to
promote job-creatingeconomic solidarityprojectsthataretailoredtolocal socialconditions.
ALURE. This EU-Latin American economic co-operation programme in the energy
sector, which started up in 1996, will come to an end in 2003.131The €26 million
programme has promoted 25 gas and electricity projects involving a hundred odd
participants from private companies, public administrations, NGOs and others. Thisprogramme has helped meet the energy requirements of the Latin-American
countries, both quantitatively and qualitatively, while promoting the access of
disadvantaged groups to these services and safeguarding the environment. The
projects generated substantial value added for the recipients, primarily through the
transfer of proven solutions and instruments of the European energy sector, which
were adaptedtothe Latin-Americancontext.
CLIOPE: effectivenessandenvironmental protectioninrunning power stations
Inrecentyearsseveral LatinAmerica countries have sufferedfrom electricity shortages, mainly
as a result of a big increase in demand and insufficient investment in energy production.
Furthermore, there are many power stations in the region which are highly pollutant, inefficient
and of limited availability. The CLIOPE regional project tackles this by training about a
hundred Latin American managers and technicians and setting up an internet network for the
exchange of information and know-how between the two regions. To date the project has
createdthreecentresforfurthertraining(inColombia, Argentina andMexico) and forgedlinks
between professionals in the sector, which will facilitate the preparation of projects to convert
power stations, the acquisition of modern equipment and open up new commercial
opportunitiesforbothregions.
131http://www.europa.eu.int/comm/europeaid/projects/alure/index_en.htm
187@LIS, the Alliance for the Information Society, was adopted by the European
Commission on 6 December 2001.132The programme aims to promote the
information society in Latin America and overcome the digital divide by stimulating
co-operationwithEuropeanpartners and helping to provide solutions to the needs of
thelocalcommunitiesandcitizenswithaviewto sustainabledevelopment.
With a budget of €85 million, including €63.5 million financed by the European
Community, @LIS is addressed to all members ofcivil society, especially non-profit
making associations.
Most horizontal programmes were reviewed in 1999 and evaluated in 2000/2001.
Results are very encouraging overall; the programmes have created economic,
academic, cultural and technological links between the two regions, boosted
European representation in the region and established ongoing relations with
governments, localauthorities, the private sector and civilsociety.
4.7.2.2. Co-operationwithregionalbodiesand bilateralco-operation
At subregional and bilateral levels, co-operation continued in 2001 in pursuit of
specific priorities set out in existing institutional agreements, tailored to the specific
circumstancesofeachcountryorregion.
Subregional projects were committed under budget lines B7-310 (financial and
technicalco-operation) and B7-311 (economic co-operation) in Central America, the
AndeanCommunityand Mercosur.
a) CentralAmerica
Co-operation with Central America is carried out under a Co-operation Agreement
that entered into force in1999.
In 2001 the Commission allocated €8 million to a customs union project in the
context ofeconomic co-operationwithCentralAmerica.
Bilateral co-operation: the Commission allocated €29 million to El Salvador, €16
million to Guatemala, €9 million to Panama, €10 million to Costa Rica and €11
million to Nicaragua. The amount allocated reflects the Commission's determination
to actively support projects that reinforce and consolidate democratic institutions and
the rule of law, that promote the regional integration process, that encourage
economic development and help insert Central America into the world economy.
There was aid fromother budget lines as well as financial and technical co-operation
and economic co-operation in 2001. In response to naturaldisasters, the Commission
allocated the region €68 million for rehabilitation and reconstruction projects in
CentralAmerica (Nicaragua, Guatemala and ElSalvador) and Venezuela.
The Regional Programme for the Reconstruction of Central America ( PRRAC)i sa
large-scale project. Set up after Hurricane Mitch to run over seven years, its remit is
to rebuild and strengthen health and education services, which were hard hit in most
132http://www.europa.eu.int/alis
188countries ofthe region, and to make an assessment of the environmental degradation
caused bybad weather conditions.
The PRRAC is implemented through 16 major projects, the budget for which is
shared betweenNicaragua, ElSalvador, Guatemala and Honduras.
PRRAC - Honduras
In addition to these large-scale projects, there are smaller projects that have already given
concreteresults, suchasthewaterandsanitationprojectunder wayinHonduras. About 70% of
the objectives have been achieved: 24 culverts built and another 16 near completion; 52 water
wells sunk, 106 trained local promoters and 1.081 families trained in hygiene and diseases
transmitted bycontaminated water. The other 30% are beingimplemented.
b) AndeanCommunity
Co-operation with the Andean Community countries aims to the strengthen
democratic institutions and the rule of law, promote regional integration and
socio-economic development, and enhance co-operation in combating drugs and
preventing natural disasters. Support for the difficult peace process in Colombia is
also one ofthe specific EU priorities in the region .
The "peace laboratory in the Magdalena Medio" is the first major action in the EU's
programme to support the peace process in Colombia. It will be implemented in 13
localities of the Magdalena Medio, a region hard hit by the armed conflict, including
the region's capital, Barrancabermeja. There is Community financing of €35 million
for this eight-year programme drawn up in 2001, which is scheduled to start up in
2002. The EUhas also committed €11 million inEcuador forthe development ofthe
R i oP a u t eb a s i na n d €10 million in Venezuela for reconstruction in the flood-
affected state of Vargas. The Commission has committed a total of €500 000 for a
subregional project (68% of the total), which consists of a study on the state of and
prospects for economic and trade relations between the EU and the Andean
Community. Its finding should be available in2002.
Study on the state of andprospects for economic and trade relations between
the AndeanCommunity and the European Union
Part of 2001 programming, this project will take stock of economic and trade relations between
the EU and the Andean Community of Nations (CAN). The need for such a report was stressed
by the ministers of both regions at the IXth Ministerial meeting between the EU and the Rio
Group (Vilamoura, 24February 2000).
The study's terms of reference were drafted in 2001 and the study itself will be carried out over
six months by a group of European and Andean consultants. They will analyse five aspects:
foreigntrade,public procurement,services, foreigndirectinvestment andintellectual property .
c) Mercosur
The guidelines for co-operation with Mercosur are laid down in the 1995 Framework
Agreement, which in the longer term is likely to be replaced by a more ambitious
associationagreement.
189Co-operation with Mercosur focuses on the process of regional integration and on
negotiations on a future association agreement between the two.133In 2001 €
5.3 million was allocated to a customs co-operation project that will continue theintegrationofthe customs administrations of the four Mercosur countries, so laying a
basis for the region's economic and commercial development and its relations with
theEU.
Under financial and technical co-operation
€2 million was committed to projects to
modernise the Brazilian tax system and €900 000 to improve the quality of the
environment inUruguay.
Mercosur – technical standards
The Community supports Mercosur's integration by helping to create the technical framework
essential for an internal market. Since 1999 the Commission has been implementing a €3.95
millionprojectonMercosur technicalstandards.
Given developments in the intervention sectors during the programme's implementation, the
actionshave hadtoberegularlyadjustedtonewnationalandregional circumstances.
This support for technical standards (mainly institutional support for national and regional
standards agencies and structures for notification, information, certification and accreditation)
creates more favourable conditions for intra-regional and international trade. Measures in the
field of metrology (legal and industrial) pave the way for future specific mutual recognition
agreements. The project takes the formof general actions and eight subprojects in the Mercosur
countries that transfer European experts' know-how about technical standards tolocal technical
staff.
RegionalCo-operation - 2001 commitments(budgetlinesB7-310 andB7-311)
Region Project title Amount €
Regional -
Latin America– Supportfor agronomicresearch viatheCGIAR
– EU-Latin American network of experts for
macroeconomic coordination.
– Alliancefor theinformation society@lis.– WALCUE-S&T thematicworkshops ALCUE 2001/2002– Networking Central andEastern Europe and Latin
America6,000,000
200,000
63,500,000
639,000234,500
AndeanCommunity– Studyon EU-CAN economicandtraderelations 500,000
Mercosur – EU-Mercosur customs co-operation 5,300,000
Central
America– CentralAmerican customsunion 8,000,000
TOTAL 84,373,500
4.7.3. transport and infrastructure
A key element in past development, infrastructure remains an important part of co-
operation with Latin America. This is especially true when it is part of a general
framework of regional integration and of efforts to improve living conditions and
health and to mitigate the risks connected with naturaldisasters. This sector accounts
for some 10% ofCommunityaid.
133Trade negotiations with Mercosur continued in 2001 in a difficult context of growing economic
problems in theregion, especiallythe deepening recession in Argentina.
1904.7.3.1. Roadtransport
Nicaragua. In 2001, the Commission committed €11 million for the El Guayacan-
Jinoteca road project.
Ecuador and Peru: integration by thePiura-Guayaquil road
Physical communications between Ecuador and Peru will be improved by a project to
rehabilitate the Piura-Guayaquil road link. Feasibility studies of the road, the bridges and
infrastructure at the border between the two countries costing €2.8 million are currently under
way. Thewill then be followed byworksfor which the Community contribution is estimatedat €
40 million (2002 –2006). The project will help improve relations between the two countries
under a bilateral development plan drawn up following the signing of the peace agreements in
1998.
4.7.3.2. Water and Sanitation
The need for drinking water and sanitation systems has led to vast programmes in
various Latin-American countries. Such projects help prevent epidemics, reduce
infantile mortality and improve living conditions and hygiene. In Boliviathe
authorities are particularly sensitive to these problems and they have developed the
Agua para todos programme inruraland urbanareas.
Bolivia:drinking waterintheBeni department
This project for the 125 000inhabitants of this sparsely populated department has been running
since January 1998. It focuses primarily on urban centres with 5 000 odd inhabitants but does
not neglectlow densityareas.By the year 2002, 50 water collection and distribution systems will
have been set up in the centres and 400 in low-population areas. This is an innovatory project
implemented by microenterprises and encouraging the participation of users.. The same
formula has been used to build 3000 latrines with family-type septic tanks, of which 750
collectively on the urban sewage network, plus a waste water treatment station in the town of
Santa Ana. Training programmes on the management and maintenance of the infrastructure,
plus education in hygiene and health complement the project and ensure its viability. This pilot
project, financed to the tune of €6 million by the EC and €2.1 million by the government, has
beenreproducedinother departmentsof thecountry.
4.7.3.3. Other infrastructure
El Salvador and Venezuela. Two programmes to rebuild infrastructure following
natural disasters were prepared in 2001: one in El Salvador allocating €25 million
for housing and social and economic infrastructure damaged by the earthquakes of
Januaryand February2001.
The reconstruction and rehabilitation programme for the state of Vargas in
Venezuela received a Community contribution of €35 million, of which €10
millioncame fromfinancialandtechnicalco-operationline.
Ecuador. Steps have been taken towards integrated water basin management: this is
a very complex problem since the imperatives of protecting and conserving natural
resources have to be reconciled with local people's need for agricultural land,
especially since many of them are indigenous peoples hard hit by poverty. A project
to manage the basin of the Paute river - which recently caused destructive fl ooding –
has been drawn up. Costing €11 million it will improve the state of these resources
andstabilisetheenvironmentalandsocialframeworkofthebasin.
191Transport, infrastructures and environment: 2001 commitments
Sector Country Project title Amount €
Infrastructure El Salvador Supportprogramme for thereconstructionofEl Salvador 25 000000
Infrastructure Uruguay Improvements:environment/urban development, western
zone ofMontevideo900 000
Infrastructure Venezuela Programme ofsocialreconstructioninthestateofVargas 10 000000
Infrastructure Panama Rehabilitation ofthehistoricalcentreofPanamaCity 950 000
Infrastructure Nicaragua El Guayacan-Jinoteca roadproject 10 900000
Environment Ecuador DevelopmentprojectinthePautebasin 11 000000
TOTAL 58 750 000
4.7.4. Food security and rural development
In2001 a specialeffort was made to achieve the environmentalpriorities agreed with
the Latin American countries concerning better management of naturalresources and
efficient use of factors of production in rural areas (water management, legality of
acquisition of land/land dispute settlement, etc.). To this end, the projects
implemented in this region do not aim merely to satisfy short-term food needs but
alsotakeaccountoflong-termsustainabledevelopment.
Ecuador - foodsecurity
With the collapse of the financial sector and the devastating effects of El Niño and the
proportion of the Ecuadorians living in poverty rose from 49% to 65% between 1995 and 2001.
To reduce the vulnerability of the poorest sections of the population a direct food security
programme costing €6 million was launched in 2001. The programme will both support
production and promote nutritional awareness in health centres. The support for rural
production is implemented in liaison with the World Bank, civil society and central and local
government. This will increase the intervention capacity of local organisations and so bring
about a structural improvement in production capacity in less advantaged parts of the country
The EU is giving substantial financial support to two key instruments in the process, namely a
localinvestment fundanda ruralfinancesystem.
Argentina–integratedprojectintheRamónListaregion
The indigenous Wichi community lives in the region of Ramón Lista in Formosa province in
north-western Argentina. The population is concentrated in an area of 3 500 km² along the
Pilcomayoriver.
Community aid finances actions covering education, training, nutrition, the construction of
infrastructure (roads, houses, health posts, schools, harvest basins, water supplies, etc),
reforestation, and environmental protection. The €8.6 million project, 5.5 million of which
comes from the EU, has been running since 1995 (EU funds implemented: €3.5 million). The
project benefits 6000 people livingin 20communes.
The most significantresults were obtainedwithinfrastructure, 64 houses with access roads were
built in 2001. The project has also developed a large-scale training programme and provided
communications and transport equipment; side by side there is also the promotion of craft
activities and small businesses. All activities, from programming to the implementation, have
beencarriedout withthedirect participationof thebeneficiariesandlocal organisations.
192Ruraldevelopment/food security - 2001 commitments
Sector Country Project/programmetitle Amount €
Rural development Regional L.
AmericaSupportfor agronomicresearch viathe CGIAR 6 000 000
Food security Peru Food security- European Commission 5 000 000
Food security Honduras Several operations 6 696 996
Food security Ecuador PROLOCAL(Programa de AliviodelaPobrezay
DesarrolloLocal Sostenible)6 000 000
Food security Bolivia Programa deApoyoa la SeguridadAlimentaria
(PASA)2 145 901
Food security El Salvador Several operations 690.010
Food security Nicaragua Several operations 891 312
Food security Guatemala Several operations 447 350
TOTAL 27 871569
4.7.4.1. Localand regionaldevelopment
Chile.A project to draw up a master plan for the coastal area of the Coquimbo
region illustrates how environmental concerns can be taken on board in the context
of good governance and decentralisation of government, The €21.5 million project
will help mitigate the negative impact of tourism and fishing on natural resources.
The project willalso dealwith the problems of managing naturalresources, above all
water,inthearidecosystemsofthe interior.
Programa IntegradodeGobernabilidadyDescentralización
This four-year project in the Coquimbo region in Chile is in its second year of implementation.
The totalbudget is €21 million.
It provides support for decentralisation and institutional development and all the activities take
account of the environmental dimension.
The fields of intervention are: local/municipal development in nine of the 15 communes of the
region, economic development in all 15 communes of the region, and regional development and
regional planning in eight communes. In the latter case, the project activities include basin
management and planning/management of thecoastal area (400kmof coast).
The participation of the people affected is systematically encouraged. In the Río Choapa basin
project the users of the water (farmers mainly) act as the equivalent of a basin management
agency. For the planning and management of the coastal area, it is the inhabitants of the
"Choros" and "Punta de Choros" districts of La Higuera who have drawn up their
development projectinconjunctionwiththemunicipality.
4.7.4.2. Alternative development
In addition to the rural development projects promoted by the EU, another concept
has emerged, that of alternative development. Through a package of measures, it
aims to effect a switch in production from illegal to legal crops. It entails taking
account not only of economic considerations but also the whole way of life in the
193intervention area. The choice of measures is arrived at through democratic
consultationwiththe interestedparties.
Bolivia and Peru. In these countries alternative development concerns for the most
part illegal coca production. The Andean countries see the EU programmes as
strategic support in the fight against the production and processing of drugs. The
programmes provide support for alternative crops, livestock production,
infrastructure, support for the democratic process, and management of the
environment and forests.
PRAEDAC (Programme of support for the alternative development strategy in Chapare)
In partnership with the peasant organisations and local authorities of Chapare, this programme
has supported projects costing more than €3 million. The local authorities have carried out
infrastructure works for sewage, education and health and built roads. All works have been
proposed and carried out on a participatory basis. The population of Chapare chose the projects
and implemented them in association with the local authorities, contributing 30% of the
financing themselves. The production of fish, bananas and pineapples for the local and
subregional markets has beena big success.
A credit programme promoted by PRAEDAC via a local financial institution has benefited 400
families.. The borrowers have invested a capital of €1.2 million in handicraft projects,
improvementsinthemarketing oflivestock,agricultural produce andeco-tourism .
4.7.5. institutional support
The Commission efforts here are aimed at institutional capacity building, good
governance and rule of law.134Policy is set out in the communication from the
Commission to the Council, Parliament and the Economic and Social Committee on
a "new EU-Latin-American partnership on the eve ofthe 21st century.135
4.7.5.1. Institutionalsupport at national level
This involves two types of action. One underpins the efforts of LatinAmerican
governments to consolidate the rule of law by helping to improve the working of the
public administration and promote good governance (also at local and municipal
levels). A second consists of support for government reform programmes and
decentralisation inthe formof modernisation of the centraland localadministrations,
tax reform, pruning and modernising public services and training ofcivil servants. In
2001three projects were approved for atotalof €22.1 million.
Institutionbuilding -2001 commitments
Institution building Country Projecttitle Amount €
Justice Guatemala Supportprogramme for reformofthejusticesystem 10 150000
Taxsystem Brazil Supportfor themodernisation oftheBrazilian fiscal
system2 350 000
Decentralisation Costa Rica Municipal reinforcement and decentralisation 9 600 000
TOTAL 22 100000
134COM(2000)212 final of26.4.2000andDeclaration oftheCouncilandtheCommission of 10 November
2000.
135COM(1999)105 final of9.3.1999andCountryStrategyPapers.
1944.7.5.2. Regionalintegration
The European Union attaches great importance to regional integration. In this sector
the Commission has implemented co-operation projects to support the regional
integration process and enable the countries concerned to endowthemselves with the
capacity and institutions necessary for integration into the international system. In
2001 three projects were approved, for Central America, Mercosur and the Andean
Community, for atotalof €13.8 million.
4.7.6. Macroeconomic policies
In 1999-2000 the Commission used macroeconomic aid as an instrument of co-
operation with Latin America by giving financial support to Bolivia, Honduras and
Nicaragua in the framework of the World Bank's HIPC initiative (Highly Indebted
Poor Countries). The Commission has allocated €45 million to the initiative. It also
collaborates with other donors in financing programmes of studies on
macroeconomic policies. In 2001 the Commission supported a programme of studies
coordinated by CEPA on the analysis of macroeconomic conditions and public
finances.
4.7.7. Social services: health and education
4.7.7.1. Health
Two quite different mortality and morbidity profiles coexist in Latin America,
reflecting poverty or, in contrast, the typical health problems of more developed
societies. The proportionofpublic spending allocatedto health is clearly insufficient,
management of services is poor and the services are not very accessible. What is
more, less than a third of the population has social security cover. There is also a
tendency to concentrate financial and human resources in urban areas but, evenwhere services are available, access is confined to the more affluent sections of the
population.
There are 11 health projects under way in Latin America, primarily support for
institutional infrastructure.
In Venezuela, there are two projects totalling €13.5 million to support the hospital
sector andthe healthsystem.
InPeru, two projects totalling €3.5 millionsupport reformofthe healthsector.
Five projects to strengthen the healthcare system are under way in the Central
Americancountries for atotal €29.6 million.
In Bolivia €25 million was allocated in 2000 to a health sector project, which is now
starting up.
In Brazil €900 000 have been allocated to the São Rafael Biotechnology Centre,
whichis nowinitssecond yearofimplementation.
195Guatemala –Apoyoa lareforma delsector salud
The APRESAL project, to which the Community contributes €11.3 million, has become an
invaluable partner of the Ministry of Health. Its main activities, concentrated in the Alta
Verapaz department where there is a large indigenous population, are designed to improve
infrastructures and equipment, access to water and to health services, the availability and
proper use of essential medicinesand traditional medicine.
The project has developed original and effective working methods, better management of
servicesand better training of human resources inthe sector. To achieve its goals and carry out
itsactivities,APRESAL liaiseswiththeMinistry ofHealth, NGOsandgrassrootscommunities.
Its principal concern is to make these results sustainable and capitalise on this experience in
order to improve the quality of future interventions. It is difficult to measure the direct benefits
of the project but APRESAL's work has clearly contributed to the establishment of a
vaccination system providing suitable cover. Furthermore, after the passage of health
professionals in the project area, maternal mortality in the Alta Verapaz region was reduced by
half. Other results include improved access to secondary healthcare, sanitation systems and
drinking water. Healtheducation has alsobeenintroduced in schools.
Nicaragua - Decentralisedhealthcare
The overall objective of the €14 million project "Fortalecimiento del Sistema de Salud de
Nicaragua" is to make the public health system more effective. The activities financed by the
project are concentrated in the north and cover approximately one million people.
The projectisbasedon anintegrated intervention strategy using criteria of quality, accessibility
and social participation. The use of health resources is optimised through a decentralised
organisationof healthservicescentred on primarycare, which are organisedby levelsof service
provision. The project is currently being implemented; the expected results are a functional
organisation of decentralised services, developed in an integrated and gradual manner with a
suitable geographical distributionandpopulationcover .
4.7.7.2. Education
EU-Latin America co-operation on education is designed to ensure that activities on
the ground are implemented for and with the local beneficiaries, taking into account
identified priorities. This facilitates the "ownership" of the results and adaptation of
the practices and methodologies developed, so ensuring a multiplier effect.
The European Commission's social development projects that have a preponderantly
educational/vocational training component are designed to reduce inequalities of
access to compulsory schooling and to nurture the capacity to join society thanks to
work and personal development and attenuation of the conditions which can lead to
failure.
There are 14 education/vocational training projects under way in Latin America.
Some support key aspects of educational reform, others are structural, including the
insertion of young people into the world of work, others are specific to vocational
training.
196El Salvador - Apoyoal procesodereforma delaeducaciónmedia enelárea técnica
ECcontribution: €14.2 million
This project aims to improve the quality of lower secondary education, in particular technical
schools, and promote equal opportunities, including gender equality, through provision of
support for national educational reform. The project will transform 22 lower secondary
technical institutes in 14 departments of the country into"model centres".
APREMAT has become an invaluable partner of the Ministry of Education and plays a leading
roleinthereformof technicaleducation.
After a participatory development phase to look at new teaching methods, the project is
working closely with the principal actors for the implementation of model teaching approaches.
As well as the Ministry of Education, the educational institutions throughout the country,
industry, governmental and non-governmental organisations, the Chamber of Commerce, and
soon are involved in thisdecision-makingprocess.
The qualitative improvement of technical education, including gender equality and
environmental education, should make a decisive contribution to the cultural, social and
economic development of thecountry .
Peru- Progama marcodeformaciónprofesional tecnológicay pedagógica
ECcontribution: €9million
This project comprises two components: PROTEC (technical training) and PROEBI (bilingual
teacher training). The PROTEC component is designed to remedy the shortcomings of an
unclear policy on technical education, alleviate the lack of economic and human resources and
improve the quality of the training given. Almost 9000 people were trained in 2001. A network
of 13HTI's(higher technical institutes)in the mainregions of Peruhas beensetup.
The PROEBI component is intended to train bilingual instructors in Peruvian Amazon. The
indigenous peoples of Amazonia took an active part in the identification, formulation and
implementation of the project. There has been extensive interdisciplinary work by
anthropologists, linguists, educationalistsand indigenous specialists.
4.7.7.3. Support for disadvantaged groups
Assistance for disadvantaged groups, especially in an urban environment, requires a
multidisciplinary approach and active solidarity between the participants. The aim is
to bring together expertise and commitment in the service of integrated development
that would restore human dignity and cultural pride, as well as reduce economic
poverty.
El Salvador . In December 2001 a €9.2 million project was approved for the "social
prevention of violence and juvenile delinquency in ElSalvador". It has as objectives
the reduction of juvenile delinquency and the social integration of 50 000 young
people at risk (aged 10 to 25) inthe SanSalvador metropolitanarea.
In Latin America 16 co-operation projects for a total of €116.7 million are being
carried out inthis sector.
197Brazil-Support for disadvantaged groups in Riode Janeiroand SãoPaulo
ECcontribution: €12611792
In Brazil 70% of the population lives in urban areas. For three years the European Commission
has been making a significant contribution to the fight against exclusion in urban areas by
playing an active part in an urban and social development project carried out in partnership
with themunicipalitiesof RiodeJaneiroand SantoAndré(stateof SãoPaulo).
The work of Santo André has been recognised and lauded by the Brazilian authorities, notably
at thelast "Istanbul + 5"world summit heldinNewYorkin June 2001.
More than 60% of the infrastructure started in 1999 in the favelas of Sacadura Cabral and
Tamarutaca has beencompleted.
In the period 2000/2001 more than 3 000 people received vocational training that would help
them enter the labour market. More than 1 100 children and adolescents took part in
educational and leisure activities (crafts, music, dancing, sport) to underpin the school syllabus.
Some 250 women take part annually in activities relating to equality and domestic violence, and
370 disabled people take partinspecific projectstointegrate thembetter intothecommunity.
Argentina-AccióndeApoyointegral ala socializaciónde menoresmarginados
enElGranBuenos Aires
ECcontribution: €9 million
This project operatesa shared management model, supported by a mixed institutional platform
whichcombines the efforts of the EU, the Argentinianpublic services at national, provincial and
locallevels, andorganisationsof civil society.
The principal merit of the project is to forge links between the state and representatives of civil
society working with children and adolescents. A major contribution has been made by the
following activities: the building and/or equipping of 58 buildings for non-governmental
organisations; 40 trainingcourses attended by3 600 professionals of the public services and civil
society; direct care in the form of socio-health prevention for more than 3000 children; the
reinforcement and development of five new NGO networks with a total of 300 participating
organisations; raising publicawarenessbyplacinginformationabout the situationof childrenin
the media (publication of the magazine Foro de Proamba magazine, radio time of 6200 minutes,
16 TVappearances, 30filmed newsitems, 6 books about the project, etc.).
Paraguay - AMAR:integralassistancetohigh-risk minors
ECcontribution: €10 030 000
In 1996 41% of the 4.1 million inhabitants of Paraguay were under 15, and 130 000 annual
births meant a doubling of the population in 22 years. Migration from the countryside to the
cities was enormous and shanty towns proliferated. Projects aimed at poor families were few
and far between, and not very effective. Faced with this situation, the Commission decided to
support Paraguay's Sécretaría de Acción Social with a €10 million grant to cover 79% of the
AMAR project's budget. the aim of this project is to minimise the social risks to which young
people are exposed by promoting their personal development, improving the families' living
conditions and stepping up institutional support of the community.
This five-year project, which started in February 1999 has established coordination with all the
actors on the ground so as to make the best use of resources andensure complementarity. Close
co-operation between the government, the local church and AMAR has produced some initial
results, one being the entering of thousands of minors without identity documents in the civil
register. There was an eighteen-month pilot phase, at the end of which the initial approach
based on simple assistance was followed byactivities togenerate income for the families .
198Socialdevelopment - 2001 commitments
Sector Country Project title Amount €
Health ElSalvador Rehabilitation ofSonsonatehospital 700 000
Education ElSalvador Strengthening the multidisciplinary faculty at the
UniversityofEl Salvador129 500
TOTAL 829.500
4.7.8. Thematic policies
4.7.8.1. EuropeanInitiative for Democracyand HumanRights (EIDHR)
In 2001 more than €15 million went to projects in Latin America under the EIDHR.
Two multiannual regional programmes (2001-2004) also started up in 2001 ( €
17.5 million from the 2000 budget); they will promote Human Rights and
fundamental freedoms in the Andean Community and Central America. Activities
under these programmes are carried out by non-governmental organisations,
independent universities and institutions. Microprojects for a total of €1.1 million
willbe implemented inColombia and Mexico.
The EIDHR allocated almost €3.7 millionto five projects to promote and defend of
Human Rights and fundamental freedoms . In Ecuador, nearly €1 million for a
programme to protect the Human Rights of migrants and of their families,
particularly women and children who became victims of trafficking following the
severe difficulties in the country since 1998; a project to improve the legal
framework of children in El Salvador, Costa Rica, Guatemala, Nicaragua and
Honduras and to monitor the recent research on trafficking in children and their
commercial exploitation received €450 000; €230 000 wet to the organisation of a
conference, the publication of best practices, the appointment of mediators and
exchanges of experiences on the work of the institutions and enhancing co-operation
between Latin America, the Caribbean and the EU. The aim of this project is to help
strengthen mediation machinery and national arrangements to protect Human Rights
in Latin America and the Caribbean, in accordance with democratic tradition. Five
rehabilitation centres for the victims of torture in Latin America were allocated €
2.2 million.
Support forthe democratisation process and strengthening the rule oflaw tookthe
form of almost €3.6 million for six projects. €848,000 for a project to develop the
activities of the ANDI network (Children' s Rights News Agency), which embraces
five press agencies acting to defend the rights of the child in Brazil; the project will
directly benefit the member organisations, students, companies, media professionals
and organisations working with children and adolescents. In Argentina, a project was
accorded €400 000 €to promote the participation of citizens in the decision-making
process and to encourage the dialogue between organisations of civil society and the
state in five regions ofthe country. It also aims to strengthen equal opportunities and
promotethedefenceofHumanRightsinthecontextofdemocratisation.
Support forthe prevention of the conflict and therestoration of peace is one of the
main priorities of the EIDHR. In 2001 it financed four projects in Latin America for
over €3.6 million. In Colombia, €1.3 million for a project to safeguard the basic
rights of the Uraba communities, which are threatened by displacement as a result of
the conflict currently tearing apart the country. Two other projects in Colombia will
199(i) underpin and develop the work of 900 municipal mediators for the protection and
promotion of Human Rights ( €560 000) and (ii) strengthen civil society as a key
actor in resolving the armed conflict in Colombia - the project aims to transform the
town of Barrancabermeja into an area of peace ( €984 000). Lastly, a project in
Guatemala is designed to promote peace and reconciliation between communities in
three municipalities of the Alta Verapaz department that have been victims of the
civilconflict.
In 2001 the EIDHR supported the transition to democracy in Nicaragua by sending
an EUelectoral observer mission to the general elections held on 4 November
2001. The team had six principal members and eight long-term observers, plus 36
short-termobservers forthe first round and 30 short-termobservers forthe second ( €
998 915).
4.7.8.2. Gender equality
Promoting gender equality is a crosscutting objective that is systematically taken into
account whenco-operationprojects are drawnup.
Two projects that are specifically targeted at women in Latin America are currently
under way:
Panama - PROIGUALDAD:The challenge of equal opportunities for women
ECcontribution: €9.8 million
Launched four years ago, thisprojecthasimproved Panamanian women's livingconditions.
With the support of 31 institutions, 26% from the public sector and 74% from civil society,
PROIGUALDAD has managed to strengthen women's organisations participating in this
ambitious programme in urban and rural areas. These stakeholders will be able to continue
promoting equal opportunities once the projectisconcluded.
Campaigns have been carried out to raise awareness of gender equality issues in the public
sector. This aspect has been incorporated more fully in the education system by means of
humanresourcestraining andthedevelopment of appropriate methodologies.
There were also several communication schemes on this subject in 2001. The nation-wide
multimedia campaign on sexist stereotypes136generated ahuge response.
Paraguay - RED-CIDEM: Decentralisationat the service of women
ECcontribution: €8.2 million
As part of the process of democratic transition in Paraguay, the aim of the project "Network of
Initiative and Development Centres for Women" is to strengthen the organisation of
Paraguayan women and promote their active participation in development. The Agreement
providesfor settingup14 Centresindifferent departmentsinParaguay, 9of whichwere up and
running at 31December 2001.
Each of these structures plays a vital role in the recently embarked-on process of
decentralisation by promoting in a pilot municipality a local development plan that takes into
account specific male and female aspects and by relying on the departmental authorities to
adopt measures toapplythe "National Planfor Equal Opportunities".
These activities have been supplemented by directing 12 000 people to the competent bodies,
training 4 000 beneficiaries and contributing to the drafting, dissemination, circulation and
application of law 1600 against domestic violence. In the run-up to the municipal elections,
candidates from all parties signed a charter of good conduct and solidarity, including as a
priority the promotion and defence of women's rights. The main contributions of this project
are to foster the emergence of mutual trust between social actors and public institutions and a
new sense of citizenshipin Paraguay.
136http://www.proigualdad.com/index2.html
2004.7.9. Coherence with community policies
Generally speaking, the development co-operation approach to the countries and
regions of Latin America is consistent with the other Community policies. This is
true for example, of the Community competition policy, which fosters the
harmonisation of the rules of free competition, or the policy of Eurostat, which is
willing to disseminate the European Union's know-how to other; less advanced
regional organisations. Similarly, the Community's research policy allows the Latin
American countries to respond to calls for proposals under the international section
ofresearch framework programmes.
In the trade field, coherence is ensured by means of support for co-operation
activities (presentation seminars) designed to disseminate the generalised system of
preferences (GSP) to the Central American and the Andean countries. Similarly,
regional co-operation activities designed to strengthen regional integration and
establish common markets are consistent with Community trade policy. The trade
agreements that have been negotiated or are being negotiated with certain Latin
American countries or groups of countries also contribute to the increase in trade
between these countries and the European Union and thus to shared economic and
socialdevelopment.
4.7.10. Co-operation with other donors
Co-operation between the Commission and other international organisations is
particularly close in Latin America. These institutions are essential partners of
European co-operation policy. They contribute to financing projects of common
interest, especiallyprojects to combat povertyand strengthendemocracy.
4.7.10.1.Inter-AmericanDevelopment Bank (IDB)
Since 1997 the Commission has contributed some €57 million to the financial
operations of the IDB. Currently the Commission is financing two major trust funds
administered by the IDB: the special fund for technical assistance ( €4 million),
which finances missions carried out by national experts from the EU Member States
to prepare studies for IDBprojects, and the special funds for small and medium-sized
enterprises (SMEs) ( €15 million), which finances microcredit operations of up to €
540 000. The Commission also finance the Instituto de Desarollo Económico y
Social (INDES) , a regionalproject for managers of healthprojects inLatin America.
The Commission actively supports a number of IDB-headed consultative groups
(Colombia, ElSalvador, Guatemala, Honduras and Central America -
Reconstruction), which act as a coordinating umbrella for international donors in the
countryorgroupofcountries concerned.
In addition, the two institutions initiated a programming dialogue in 2001. The
Commission departments concerned (DG External Relations and EuropeAid) sent
representatives to Washington in October 2001 to meet their IDB counterparts and
exchange views on the situation in Latin America., their respective programming
priorities, possible areas ofco-operationand ways ofbetter working together.
To that end the two institutions finalised a draft Memorandum of Understanding
which will provide a framework for greater collaboration on jointly agreed priorities,
namelytheconsolidationofdemocracy, povertyreductionand socialequity, regional
201integration and the development of information technologies. The signing is
scheduled for May2002 atthe Madrid Summit.
In October 2001, a European Commission mission visited the IDB's headquarters in
Washington DC. On that occasion, new possibilities for co-operation were identified in the field
of support for microenterprises and regional projects. The Commission also finances the
Instituto de Desarollo Económico y Social (INDES), a regional support project for managers of
health projects in Latin America. The countries where co-operation between the IDB and the
EC should have the most impactare Bolivia, Brazil, Ecuador, Honduras, Nicaragua and Peru.
4.7.10.2.World Bank
InJuly2000 the EC signed a Contribution Agreement to the HIPC (HeavilyIndebted
Poor Countries) Trust Fund managed by the World Bank that would benefit Asian
and Latin American countries. The EC contribution amounted to €54 million, of
which €45 million was earmarked for debt relief assistance: Bolivia ( €14 million),
Honduras ( €12 million) and Nicaragua ( €14 million). All the contributions to the
LatinAmerica countries were disbursed in2001.
The two institutions' loan programme takes place against a backdrop of political and
sectoral reform. Budget support is often applied. The World Bank calls this type of
operation a programme loan – which differs from the "classic" forms of project or
adjustment loans. The programmes must have a timeframe of 5 to 10 years and in
certain cases of up to 16 years. Budget support is also envisaged for sectoral
programmes lasting 2-3 years.
4.7.10.3.US Agencyfor InternationalDevelopment (USAID )
The EC works alongside USAID under the New Transatlantic Agenda (NTA) and
joint action plan. Regular contacts are maintained in areas of common interest:
development of the private sector, institutional capacity building, assistance for
democratic institutions, Human Rights, decentralisation and so on. A study into the
evolution of development problems in Central America was carried out by the
Hamburg Institute of Ibero-American studies and the Inter American Dialogue of
Washington, DC. This analysis – warmly welcomed by USAID – proposes a model
of regional economic integration and puts forward proposals for the democratic
strengthening of institutions, for progress towards the customs and monetary union
and for the reformoftaxand budget systems inthe countries ofthe region.
4.7.10.4.OrganisationofAmericanStates (OAS)
During 2001, as the EU Member States have permanent observer status in the OAS,
they met every month to discuss questions concerning the EU and exchange views
with OAS senior officials. The OAS, which is not a financing institution and only
intervenes in partnership with other organisations, has shown a marked ability for
collecting funds (USD 36 for USD 1 of grant). During a mission in October 2001,
there were exchanges of views on three areas of activity: projects concerning natural
risks, for which the OAS has proved to be very efficient and collaborates well with
the local authorities and NGOs; promotion of democracy and the Inter-American
Drug Abuse Control Commission (IDAC). Co-operation between the EC and IDAC
began 8 years ago, with the allocation of grants to combat trafficking in the chemical
substances needed for drugproduction.
2024.7.10.5.European investment Bank
Signatory of framework agreements with 15 Latin American countries and a major
European player in the region, the EIB contributes to funding investment projects of
common interest to the EU and Latin America. As the Commission's partner, it has
mainly intervened in the following sectors: industry, energy, telecommunications,
water and sanitation, and transport. In 2001, €365.20 million was allocated to
operations in Argentina, Brazil, Panama and Mexico. An EC mission visited the
Latin America Directorate in June 2001. This mission identified three main areas of
co-operation: risk capital, SME financing and the increase in EIB loans to projects
fromtheprivatesector.
EIB projects signed in 2001
Country Project title Sector Amount
€million
Mexico Vetrotex America Industrial 15.91
Panama Cable&Wireless PanamaII Telecom 54.23
Argentina VWArgentina Industry 46.61
Argentina CentralDock Sud Energy 77.33
Brazil COMGAS Energy 46.80
Brazil Vega DoSul Industry 58.00
Brazil Veracel Foresty Agriculture 32.74
Brazil LightElectricitydistribution Energy 33.58
Total 365.20
4.7.11. ECHO
In 2001 ECHO (European Community Humanitarian Office) granted humanitarian
aid of €35.05 million to Latin America. The two main areas of intervention were
Colombia and El Salvador. In Colombia, ECHO has been active since 1997 to help
people who are internally displaced as a result of the fighting between various armed
groups and the government, above all in the period immediately following their
displacement. In El Salvador, ECHO aid was used to provide the victims of the two
earthquakes at the beginning of 2001 with temporary shelter, clean water, sanitary
systemsand medicines.
Other operations were in response to natural disasters in Bolivia, Paraguay, Peru,
Guatemala, Honduras and Nicaragua, and to help people displaced by the Chiapas
conflict in Mexico. Under its DIPECHO programme, ECHO also launched a series
of projects designed to ensure that local populations are better prepared against
naturaldisasters inthe AndeanCommunityand Central America.
203ECHO - Financialdecisions 2001
Country Projecttitle Amount
€million
Bolivia/Paraguay Humanitarianaid for victims ofthefloods anddroughtin Bolivia
andbythedroughtinParaguay1.950
Colombia Humanitarian aid for displaced peoplein Colombia 10.000
El Salvador Humanitarianaid for peopleaffectedbytheearthquakes of13/01
and13/02/0110.000
Guatemala/Honduras/
NicaraguaHumanitarian aid for victims of the drought in Central America 3.350
Mexico Humanitarianaid for displaced peoplein Chiapas 1.800
Peru Emergencyrelieffor victimsoftheearthquakeinPeru 3.150
Andean Community DIPECHOSecond ActionPlan(disasterpreparednessandprevention
measures) forthe Andean Community1.800
TOTAL 32.050
4.7.12. Monitoring inLatinAmerica
In 2000 the Commission devised a system to monitor the improvement in results
based on the project cycle management tried out in 2001 in each geographical zone
(ALA/MED/ACP/Balkans). The initial data, still provisional, collected under this
newsystemhaveprovidedusefulinformationabouttheprogressofprojects managed
by each geographical directorate and about the improvements that should be made.
The system will be extended to cover all of ECHO's activities and will be fully
operationalin 2002.
In 2001, 80 projects were reviewed in 13 Latin America States. The Community
contributiontotheseprojectsamountedto €381.9 million. Ofthis total, 21% went to
the education sector and the rest was equally divided between the other sectors
analysed.
The average mark obtained by these projects was 2.69 whereas the average mark
obtained by all the projects financed by the European Community worldwide was
2.5.
The projects were marked on the basis of several criteria, such as effectiveness,
efficiency, expected secondary effects or inclusion of the environmental dimension.
In Latin America the effectiveness of projects was judged to be very satisfactory.
None the less, failure to meet deadlines and taking insufficient account of the
environmentaldimensionwere underlined.
These results should, however, be handled with caution for the reasons set out in the
chapter on" Monitoring" .
2044.7.13. Conclusions and prospects
As it announced at the Rio Summit, the European Union is determined to develop a
long-term strategic partnership with Latin America to defend common political,
social, economic and trade interests at international level.
Developing the special relationship between the European Union and Latin America
means maintaining and stepping up dialogue with the Rio and San José Groups and
with the Andean Community, Mercosur, Chile and Mexico. It also calls for certain
conditions to be met, in particular the consolidation of democratic systems and the
strengthening of the rule of law in Latin America, together with reduction of poverty
and social inequalities and the integration of disadvantaged groups. The sustainable
integration of the Latin American economies into the world system and their
participation in the multilateral trading system requires a certain amount of
adaptation. This calls for a context of regional integration, as fostered by the
European Union. In pursuit of these objectives, political dialogue and trade
negotiations must be accompanied bydevelopment co-operation
The policies pursued by the EU in 2001 have helped to strengthen the political and
economic autonomy of Latin America, while strengthening both internal regional
links and those of partnership with Europe. It is along these lines that the
Commission intends to pursue its activities and to continue to direct its external aid
towardsthe countries and regions ofLatin America.
The second Summit ofHeads of State and Government of the European Union, Latin
America and the Caribbean, which will be held in Madrid in May 2002, should
confirmthese co-operationpriorities.
2055. F EATURE:RESULTS-ORIENTED APPROACHTO DEVELOPMENT
5.1. Country Performance and Project Performance
5.1.1. Introduction
According to World Bank estimates, an extra $50 billion a year is needed to reach
the Millennium Development Goals (MDGs). The commitments made in Monterrey
in March 2002 to increase ODA levels are a major step forward in achieving global
sustainable development. The Monterrey consensus links, specifically, aid
effectiveness with country ownership of good policies and sound governance,
promising moreaidtogoodperformers.
How can we be sure that this extra money, and indeed any development assistance,
actually leads to concrete results on the ground? How can we be sure that our efforts
are contributing bit by bit to prosperityand security for all?
These are not easy questions to answer. Strikingly, in most developing countries
dataon povertyreduction are not merelyunsatisfactory: theyare often non-existent,
out-dated, unreliable, or simply not used as a tool for policy decisions. The
development community (composed of donors, governments and civil society) has
too often failed to examine the results of their policies and financing over the last
decades.
Reporting on financial commitments is not enough. Donors need to report and be
held accountable by their stakeholders for the concrete changesin the lives of poor
people stemming fromthe collective effort ofdevelopment partners.
The Commission is in the process of moving increasingly towards results-oriented
development assistance. This commitment to manage for and by results was
formally underlined in the Communication in 2000 from the Commission on the
European Community’s development policy and the resulting statements and action
plan.
This chapter sets out the two main approaches developed recently to measure
results. The results of any one donor’s efforts can be directly measured only on the
level of single-donor projects or programmes. Larger-scale operations involving
s e v e r a ld o n o r sa sw e l la st h eg o v e r n m e n ta n do t h e ra c t o r sw i l ly i e l dr e s u l t sa c h i e v e d
by a joint effort which cannot be attributed to one or another member of this team
(the so-called “attribution gap”). The first approach therefore describes how
collective results are monitored at the level of sectors and countries, using indicators
agreed by all stakeholders. The second part of this chapter presents an approach to
measuring and monitoring the results projects achieve, i.e. their outcomes and
possible changes inthe lives ofthe beneficiaries.
This chapter describes work in progress, and presents the main elements of ‘where
we are’ in managing for results. These approaches are not yet finalised, and some of
the components not yet fully tested. The Commission understands this chapter also as
an invitation to the reader to participate in a collective reflection on effective and
reliable ways of measuring the impact of our external assistance on global
sustainabledevelopment.
2065.2. Monitoring Results: Country Performance
The introduction of Poverty Reduction Strategy Papers (PRSP) in 1999 results
orientation being one of the five principles of these – and the agreement of 189
countries on the Millennium Development Goals (MDG) in September 2000 gave
impetus to the move towards increasing attention to results. Concrete and more
results-oriented monitoring of country performance in economic growth and poverty
reductionstems fromthe necessity, identified ina range ofstudies, to improve:
For developing countries:
–Country ownership . Assigning responsibility to recipient governments for
achieving their objectives in terms of poverty reduction gives them more space to
define their ownstrategies and policies tothis end.
–National accountability . In countries developing a Poverty Reduction Strategy,
this evolution of donors from monitoring policies and actions to a participative
results-oriented approach is essential if we are to promote the development of
nationalaccountability.
–Policy-making process. The analysis of results on the ground should lead to
policyre-orientations and provide an input to policy dialogue.
For donors:
–Donor accountability to stakeholders . Reporting on financial commitments is
not enough. Donors need to report and be held accountable by their stakeholders
for the concrete changes in the lives of poor people stemming from the collective
effortofdevelopment partners.
–Donor co-ordination .F o c u s i n go nt h er e s u l t sa c h i e v e db ye a c hc o u n t r ys h o u l d
allow better co-ordination of donor performance assessment. Here again, in
countries concerned, PRSPs should provide the framework forthis co-ordination.
Two substantial areas of work illustrate that the Commission is moving increasingly
towards results-oriented development assistance: Country Strategy Papers (CSPs),
and the provisionof macro-economic support in ACP countries.
5.2.1. Results-oriented Country Strategy Papers
In the framework of the programming process, the Commission is developing
guidelines for staff programmers to introduce development indicators in CSPs. As
most donors are still at a very early stage in the conceptual work on development
indicators, the Commission is working closely with Member States, OECD-DAC,
and other donors in drafting these guidelines.
A joint working group has been set up involving Member States, OECD-DAC, and
various Commission services. It held its first meeting in March 2002. The objective
ofthis working group is to explore the potential for donorsto adopt a joint approach,
including commonprinciples and typology, in their monitoring requirements in order
to reduce the burden imposed on recipient countries. The basis for this work is the
Draft guidelines for the definition of development indicators prepared by the
C o m m i s s i o n .T h i si s“ w o r ki np r o g r e s s ” ,a n di t so u t c o m e sw i l lp r o g r e s s i v e l yf e e d
207into the Commission’s programming and review process. It has been warmly
welcomed byMember States and OECD-DAC.
TheseDraft guidelines start by defining principles and a typology, and present two
levels at which donors may use results-oriented indicators to monitor country
performance.
5.2.1.1. Typology
Indicators need to be classified according to a clear typology. We propose to use the
following classification, to ensure coherence withearlier work:
Input ➔➔➔➔ Output ➔➔➔➔Outcome ➔➔➔➔Impact
–Indicators of input measure the financial, administrative and regulatory
resources (often called “processes”) provided by the Government and donors. It is
necessary to establish a link between the resources used and the results achieved
inorder to assess the efficiencyofthe actions carried out.
Eg: Share of the budget devoted to education expenditure, abolition of compulsory
school uniforms
–Indicators of output measure the immediate and concrete consequences of the
measures takenand resources used:
Eg: Number of schools built, number of teachers trained
–Indicators of outcome measure the results at the level of beneficiaries. The term
‘results indicators’ is used as well.
Eg: school enrolment, percentage of girls among the children entering infirst year of
primary school
–Indicators of impact measure the consequences of the outcomes. They measure
the generalobjectives interms ofnationaldevelopment and povertyreduction.
Eg:Literacy rate, unemployment rate
These various types of indicators are all relevant for policy makers – that is, for
national Governments. However, they are not all similarly relevant for donors, who
should concentrateonthe outcomes ofthe nationally-owned policies theysupport.
The conclusions of the pilot exercise on the reform of conditionality137clearly
showed the need for donors to lay particular weight on outcome indicators. Past
practice however was focused rather on input or output indicators, whose
improvement gives no guarantee of improvement of services: there are, for example,
numerous examples of an increase in budgets or even in the number of health
centres, which go along with a drop in attendance at these centres. Impact indicators
are slow to respond, complex to measure and depend on numerous factors other than
the Government's policy. Focusing on outcome indicators should allow increasing
137Lead in Burkina FasobytheEuropean Commission in the framework oftheSPA, with 12other donors.
208ownership by Governments of the policies to be implemented in order to attain these
results.
A focus on these indicators should also enhance the credibility of development
assistance, inbeneficiarycountriesaswellas indonor countries.
5.2.1.2. Principles
Definitionof indicators
(1) It is necessary that each country and its main donors agree to use common
(outcome) indicators to assess country performance. In relevant countries,
thisshould bedone inthe frameworkofthePRSPmonitoringsystem.
(2) It is usefulto disaggregate indicators, e.g.by:
–G e n d e r
– Public / private sector
– Geographic (bydistinguishing inparticular the poorest regions)
– Rural/urban
– Income level(although that is seldompossible) and main source of income
In all cases the level of disaggregation should be specified when the indicators are
defined. This disaggregation allows better focus on the target populations for
development and povertyreductionpolicies.
(3) It is preferable to restrict the list to a limited number of essential indicators. A
multiplicity of indicators of all kinds creates great difficulties of
interpretation. It also makes it difficult to focus on the essentials. The
indicators chosen have then to be defined clearly and unambiguously ( e.g.for
vaccination, to specify which vaccines this involves, what is the target
population etc.) .
(4) Measurability is a key criterion when selecting indicators. This is a separate
issue from the quality of present data systems (discussed below). When
defining each indicator, it is necessary to consider the time and resources
needed to collect the data, and the frequency with which these data could be
obtained. It is possible that technically an indicator is measurable annually,
but in practice it changes only over the medium/long term. The evolution of
such indicator is then influenced by the policies implemented years earlier,
and its value as a measure ofpresent policies maybe limited.
(5) It is often important to express the statistical data for the indicators not only
in percentage terms but also in absolute values, to allow the analysis to
exclude errors dueto uncertainties in estimating the totalpopulation. It is also
preferable to work on trends rather than just on isolated data. Accordingly, it
is important to review existing databases when selecting the indicators. The
data over the last five years should be available: if this is not possible, the
indicator may need special justification.
209Reliability andquality of data
(6) It is necessary to keep a watchful eye on the reliability and the
representativity of the data on which the indicators are based. In case of
doubt, it is preferable to use a `proxy', i.e. indirect indicator that is easier to
measure and which gives a good approximation for other indicators that are
m o r ed i f f i c u l tt om e a s u r e .I ti st h e ne s s e n t i a lt oa d o p ta ne v o l u t i o n a r y
approach, with regular checks on the validity of the indicators in relation to
th eob j e c ti v eth eya r em ean tt oa s s e ss .
(7) Support often has to be provided initially to check the quality of the data and
to help the Government to improve its reliability and increase the speed of
data processing – existing systems are often excessively heavy and slow. The
aim of this support should be to strengthen the national system. Experience
shows that this support does not in general need large sums of money, and
that quick progress on the essential data is possible. It will be important to
developcollaborationwithEurostatinstrengtheningstatisticalcapacity.
Setting targets forthe indicators
(8) The Government of the country will set the target values for the indicators, in
a manner coherent with recent trends and policy orientations. They should be
discussed with the donors who plan to support the country. The Government
should define the targets for at least the period of the PRSP, if it has one, or
the next 3 years if not.
(9) Discussion of the target values faces two difficulties: excessive optimism
(often connected with the fact that the indicators are used as a slogan rather
than as a decision-making tool) and excessive prudence (showing a lack of
ambition). The best wayto avoid these two excesses is to follow a transparent
process within the country, involving civil society and Parliament both in the
discussions which lead to the definition of indicators and in their monitoring.
This transparencyalso affords the targets greater visibility, and contributes to
domestic accountability.
Analysis of the evolutionof indicators
(10) The analysis of the evolution of the countries’ performance should never be
restricted to a mechanical interpretation of indicators. It should be done in the
framework of a substantial policy dialogue with the Government, taking into
account the influence of internaland externalfactors.
(11) It is necessary to keep in mind that focusing on a limited number of
indicators, in particular when performance measured by these indicators is
used by donors to determine their levels of financial support, may alter
reporting behaviour or lead to a bias in prioritisation of policies. The
incentive effect of the overall set of indicators needs to figure in the policy
dialogue between Government and donor partners.
5.2.1.3. Monitoring countryperformance
The draft guidelines propose two sets of indicators that should be monitored in
Commission programmes at country level.
210At a general level , and in all countries where the Commission is working, a limited
set of indicators should be monitored (annually and in the medium term) in order to
have a globalview ofprogress towardsthe MDGs. This limited set should draw from
the most relevant of the 48 indicators associated with the MDGs, plus, in order to be
able to report annually on countries’ progress, a small number of annually
measurable key indicators. These supplementary indicators would include input
indicators (which are not part ofthe MDG monitoring framework), e.g. indicators to
measure the financial support to specific sectors from both Government and donors.
It would also include quick-changing outcome indicators. The draft guidelines
suggest that this minimum set of indicators, once agreed, should be monitored
systematicallyin allCountryStrategyPapersto allow comparability.
Monitoring this wide range of indicators systematically, including annually
measurableoutcomeand input indicatorsat countrylevel, willallow the Commission
to keep an eye on the evolution of sectors even where it is not an active player. This
willinformthedecisionstakenatthereviewoftheCountryStrategyPapers.
At the sectoral level , in CSP focal sectors, a wider range of indicators is to be
monitored. These indicators should be part of the more comprehensive set of
indicators used for management and accountability purposes by the relevant
Ministries in country. Although they cannot so easily be measured through
generalised quantified indicators, policy orientations and regulatory measures by
Government shouldbe monitoredaswell.
In all cases, indicators monitored by the Commission are based on the national
processes taking place in country (PRSPs for those countries for which they are
relevant). This is a process of reciprocal influence and experience sharing, as well as
a valuable tool for discussing policy issues and increasing Governments’ domestic
accountability.
5.2.2. Poverty Reduction Budget Support
A second example of the results-oriented approach is budget support for PRSPs. So
far, this feature concerns only ACP countries. A similar approach is being extended
to other programmes (ALA, MEDA) where appropriate. In ACP countries the
European Commission has an innovative approach, linking the amounts of aid
directly to the level of performance of the country in social sectors (mainly health
and education) and public finance management. This is done through the use of
performance indicators ( e.g. share of spending on health and education; enrolment
rate; attendance at health centres; infant vaccination coverage, etc.) and intensive
discussions with Government onthe degree ofachievement ofthe targets it set itself.
Meeting these targets secures full funding; missing themreduces it.
In this way, the Government receives the resources to draw up a budget better
capable ofdelivering key social services, and also receives incentives to deliver those
intentions. Because these targets reflect common agreements between the
Government and the community of donors, they carry greater weight; because the
Commissionisoneofthe leading donors,theyshould also reflect the priorities ofthe
Commission in this dialogue. Because they derive from a nationally owned PRSP,
theyare morelikelytobe implementedthanexternallyimposedconditions.
21114 out of the 30 ACP countries where the Commission currently provides budget
support already implement this approach (14 other countries are in the process of
agreeing on a set of indicators). This analysis is based on the 30 financing proposals
for Poverty Reduction Budget Support (PRBS) passed in 2000 and 2001, which
amount foratotalof €875 millions.
5.2.2.1. New orientations derived fromthe Burkina Faso Pilot exercise
In the light ofthe results ofthe pilot exercise on reformofconditionalitycarried out
in Burkina Faso138between 1996 and 2000, the Commission has set out new
orientations and mechanisms for its poverty reduction budget support programmes.
Their objective is to increase effectiveness of aid by improving ownership,
smoothing disbursements, and enhancing donor co-ordination.
The new orientations and mechanisms derived from the Burkina Faso Pilot exercise
aim to increase long term sustainability of reforms, improve Government
ownership anddevelopdonor co-ordination .
The main concrete changes in EC budget support resulting from these new
orientations are a shift from traditional process conditionality to results-based
performance assessment, variable disbursements based on the results achieved, and
betterco-ordinationwithotherdonorsinthe frameworkofthePRSP.
The degree of implementation of the new approach varies by country, due partly to
their different stages in the PRSP process and partly to variable availability of data.
However, discussions on donor co-ordination and performance indicators are closely
l i n k e dt oth eP R S Pp r oc e s s .
5.2.2.2. Reformofconditionality
The EC’s new orientations on conditionality point to a limited number of key
conditions. Traditional process conditions should be gradually replaced by
performance assessment based on outcome indicators, leaving the Government more
space to decide its ownpolicies.
Two main conditions remain associated to the signature of the financing agreement
and release of subsequent tranches. These conditions appear in all 2000 and 2001
financing proposals:
– Signature/satisfactory progress of agreement with IMF (Poverty Reduction &
Growth Facility) and sometimes with the World Bank. This should mean that the
countryhas a sound macro-economic framework.
– Progress onPRSP process
Therefore, EC programmes are closely linked to IMF (and sometimes World Bank)
conditionality.
138Thispilot was led bythe EC with the support of 9 bilateral donors and the IMF, UNDP and WB in the
context of the Strategic Partnership with Africa (SPA). Its findings are summarised in ‘Bilan : Test surlaRéformedela conditionnalité’,July2000.
212Out ofthe 30 countries in the sample, financing proposals in 15 countries include no
additional process conditionality, and in 7 countries include process conditionalities
only in public finance management.
The shift towards results-oriented performance evaluation has been much more
effective in the social sectors (health and education mainly) than in public
expenditure management. The difficulty of identifying outcome indicators in this
field is the mainreason for this slower pace.
A few countries have conditionalities in other domains than health, education, public
finance management and macro-economic framework ( e.g.transport, justice or
regionalintegration).
5.2.2.3. Results-oriented performance assessment
The new orientations of EC budget support implyan increased focus on results when
assessing the performance of countries. This focus is strengthened through the
gradual move towards linking financial support to performance evaluations based on
outcome indicators.
3 main steps are necessary before it is possible to base disbursement on the analysis
ofperformance indicators:
– Agreement between the Government and the Commission on a limited set of
outcome indicatorsonwhichto basethe evaluation, and clarityonhow to monitor
them.
– Confidence that a reliable system exists to collect data on the agreed set of
indicators, if need be supporting its improvement through capacity building and
initial financial assistance.
– Decision of the Government on the target values for these indicators, based on
pasttrendsandpolicyorientations.
Countries can be classified in three groups according to how far the EC programme
has gone along this path: most advanced countries, intermediate countries and least
advanced countries.
Most advanced countries
In the most advanced countries, prior agreement on a limited set of performance
indicators leads to their use in determining the disbursement of a subsequent variable
tranche in the programme. There is therefore one fixed tranche linked to sound
macro-economic policy (existence of an IMF programme), and one variable tranche
linked to performance assessment. In most countries, this variable tranche is divided
in two sub-tranches. One is linked to satisfactory management of public finances
(assessed through performance indicators), the other to the evolution of the set of
agreed performance indicators compared withthe targets set bythe Government.
The indicators on which disbursements are based are a mix of input, output and
outcome indicators. The most commonlyused are the following:
213Public finance management / budgetarymanagement
- ShareofGovernment’s budget arriving to most peripheralstructures
- Budget allocated to socialsectors, and actualexpenditures
- Difference inunit costsofpublic sector procurement and market prices
Health
- Attendance at primary healthservice points
- Ante natalhealthcare coverage
- Immunisationrates(DTP3,BCGand measles)
- Costofbasic medicalcare
Education
- Net / Gross enrolment rate (boys/girls) in first year ofprimaryschool
- Percentageofchildrenpassing fromprimaryto secondaryeducation
- Average pupil-teacher ratio
- Average pupil-classroomratio
- Average pupil-bookratio
- Costofaccess to primaryeducation(private / public) forthe family
The process of performance evaluation based on these indicators differs according to
the country. In all cases, the Government is asked to provide an analysis of the
results achieved, and possibly point out any external factors in order to allow an
assessment of the country’s performance on sound but not mechanical basis.
Discussion of the results of the measurement of the indicators involves responsible
line ministries ofthe Government, the EC, and sometimes organisations representing
beneficiaries or other donors. It may be decided that an indicator should be dropped,
in case of“force majeure” or exceptionalcircumstances.
The following method is applied in all countries:
– If the agreed target is reached or considerable progress is achieved, it scores 1
point.
– Ifthe target is not reached but positive progress is noted, it scores 0.5point.
– Ifthe development is negative, or insufficientlypositive, it scores 0 points.
•The totalofthese points gives the levelofrealised performance.
Calculation of the level of disbursement derived from this level of realised
performance varies according bycountry. The value of the variable tranche linked to
214performance evaluation is on average 22% ofthe totalamount ofthe programme (of
which 38% and 62% are linked to public finance and social sectors performance
respectively).
5.2.2.4. Conclusion
The new orientations for conditionality in EC budget support cannot yet be evaluated
in terms of results. Nevertheless, a review of the process and methodology is
currently under way. Meanwhile, theyraise some major issues which alldonors need
to consider:
– An increased focus by other donors on outcome indicators would enhance the
Governments’ attention to the results of its policies.
– The definition of a clear PRSP cycle, including an annual matrix of measures and
assessment of performance indicators, would improve the link between donor
support and the PRSP process.
– The combination of traditional process conditionality with result-based
assessment is incoherent and should be avoided.
5.2.3. Way forward
Two main issues are crucial if the Commission’s choice of a results-oriented
approach is to be effective.
The first one is the need to increase support to strengthening national statistical
system. This can be done in collaboration with Eurostat, and should involve
increasedco-ordinationwithotherdonors.
The second one is achieving an improved collaboration with Member States and
other donors, both in headquarters and in country. This implies better information
sharing, agreement on a joint approach, and greater willingness to co-ordinate
monitoring and reporting around nationalsystems.
5.3. Project Results: Results-oriented Monitoring
5.3.1. Background
Monitoring has many different definitions. It can be described as performance
monitoring, management monitoring or simply project monitoring. In all instances it
must be a timely, speedy and effective process to provide regular information on
progress. Monitoring is a regular mechanism of observation, involving the
preparation and submission of status reports and analytical assessments of the
project’s evolution. It is concerned mainly with measuring actual against planned
results. It enables focused project management decisions to be taken, inorderto:
– Allow adjustments to be made with minimaldisruption
– Ensure that projects remain oncourse and reachtheir objectives.
Implementation Monitoring of projects or any other activities can be done on a
daily or weekly basis, for example by a project manager who has to keep a good
215overview of the project's performance. This is mainly geared to overseeing the
transformation of inputs into outputs and is carried out by the project management
itself, supervised bythe their ownagencyor authorityand bythe EC Delegations.
Theresults-oriented monitoring system, described below, assesses the project or
programme’s performance, as well as its wider implications (without analysing these
indepth). This systemprovides the Commission with independent advice byexternal
experts on its project portfolio. The system used in the ALA/MED/ACP and Balkan
regions since 2000 (as described below) is similar to, but distinct from, the system
used in the NIS (Tacis) countries since 1993. Harmonisation of the two systems is
planned for 2002. Having one consistent approach will ensure that the Commission
has comparable data for allregions where it provides externalassistance.
In the present situation implementation monitoring is normally the responsibility of
the Government Authority and the EC Delegation. In addition projects are
monitored, with a view to results, by an independent monitoring team at regular
intervals.
5.3.2. Results–oriented Monitoring System for Development projects139- Description
During 2000, the Commission conceived an improved results-oriented monitoring
system for the ALA/MED/ACP and Balkan regions, which is rooted in the
Commission’s Project Cycle Management system. This system was tested and
improved during 2001.
The main objective is to gather results–oriented information on projects in the field
and to report on progress. The system provides an overview on project progress
towards results for both Delegations and the Office. It is not primarily aimed at
project authorities, whose day-to-day management requires more detailed
information, although it should of course be of use to them as well as to partner
Ministries and Governments.
The system involves short field visits to projects by experienced external experts,
who complete semi-standard score-sheets estimating the efficiency, effectiveness,
impact, relevance and likely sustainability ofprojects and programmes. In order to
ensure consistency in the system, each of the five criteria is thoroughly defined in
conformity with existing methodology and then broken down into its components,
which the monitor has to consider carefully before giving a rating. The external
monitoring experts have varying sectoral and geographic knowledge and experience.
They work in appropriate small teams; their work is based on the analysis of
documents and interviews with representatives from all stakeholders for a given
project, including final beneficiaries. Key data such as the project budget are noted,
but no audit or in-depth financial monitoring is done. The reports, opinions of Task
Managers and basic project documents, are recorded in the centraldatabase, which is
be a key management and information tool.
Ongoing projects (at least six months of implementation and of another six months
duration) of a certain minimum size (approx. €1 million) are monitored. By the end
of 2001, about 500 projects with a total value of €4.7 billion had been monitored in
ALA/ACP/MED and the Balkans. It was possible, during the conception and test
139Except TACIS countries.
216phase to monitor some projects twice, the number of monitoring reports is therefore
higher than500.
5.3.3. First insights from the conception and test phase
Withthe conceptionand test phase having ended in January 2002, first insights have
been gained on what works and what can be improved. These insights should be
regarded with caution, as the sample of projects monitored was relatively small in
comparison to the total volume of aid. In addition, certain instruments, such as
budgetarysupport, have not been monitored.
Performance of projects/programmes varies according to size, region and sector. A
first general conclusion is that, on average , the projects assessed were progressing
“a c c o r d i n gt op l a n ”or slightly better . The performance scale used was 1-4,
resulting in an unweighted average score of 2.5. Average scores for the various
attributes range from2.51 to 2.67.
Two keyobservations were that:
– As might be expected, projects with well-formulated, clear objectives and
strategies tend to perform better than projects with no or poorly formulated
objectives and strategies.
– Common guidelines for implementation monitoring (daily information for project
management and delegation) and other basic management instruments are likely
toimprovetheefficiencyofprojectsandprogrammes.
5.3.3.1. First insights bycriteria
In thefollowing section, best practices are highlighted in the shaded boxes.
The five main criteria in the assessments are relevance, efficiency, effectiveness,
impact and sustainability.
Average ratings for main criteria, by region140
Averageratingbyregion
Asia ACP Balkans LA MedAveragerating,
allprojects
Relevance 2.72 2.57 2.17 2.70 2.21 2.57
Efficiency 2.63 2.53 2.25 2.53 2.40 2.51
Effectiveness 2.93 2.64 2.33 2.86 2.27 2.67
Impact 2.83 2.59 2.33 2.71 2.25 2.59
Sustainability 2.73 2.51 2.33 2.68 2.39 2.55
Relevance and design (rating 2.57): Projects were generally relevant and inputs were
adequate, but the design was often a major weakness. Successful projects were
characterised by their clear reference to the national context and the existing needs
and demands of stakeholders. Poor performance in these areas was associated with
lack of a proper identification study or needs assessment to clearly identify the
circumstances and problems ofthe intended beneficiaries.
140Firstmonitoringroundonly, nore-monitoringvisits
217Mali: Programme d’Appui àla Politique Culturelle duMali-8 ACPMLI14
Sector: Culture andrecreation
Mali, one of the poorest countries of the world, is endowed with cultural heritage and tourist
potential, whichare not sufficiently promoted and exploited. Thisprojectsaims toaddress this.
Relevance andquality of design
“The Programme is designed in strict adherence to the country’s sector policy. It takes up the
challenges of the Cultural Action Plan, establishing clear objectives, purpose and expected
results. The implementation strategy is realistic and the resources made available adequate.
Correctly, the Programme recognisesandencourages collaboration and synergies with all other
initiatives,internal,regional orprovidedby otherdonors.”
Efficiency (rating 2.51): Projects had generally demonstrated their ability to respond
to changing needs and situations. However, the timeliness of activities was
commonly estimated to be a serious deficiency. Successful projects employed high-
quality management staff and made good use of logical frameworks, work-plans,
other schedules and internal monitoring systems. Poor performers lacked the
necessary qualified and stable management capacities, and made too little use of
standard project management tools; co-ordination with other involved donors and/or
sub-contractors was difficult. EC procedures were also associated with extended
delays in implementation.
India : Community Management of Natural Resou rcesALA/93/33
Sector: RuralDevelopment
The aim of the project is to contribute to reduced environmental degradation and create local
income opportunities through the development of participatory community management and a
series of micro social projects. The project has enabled remarkable improvements in the
economic and social conditions in the small tribal communities.
Efficiency
“A good cost control system has helped project management to achieve much lower costs for
each individual intervention, with the ultimate results that more micro-projects can be under-
taken without budget overruns. Project interventions are well planned, organised and imple-
mentedintime.Thisledtoahighsuccessrate. Project staff are all nationals with a good level of
education in their specific fields and a great enthusiasm for the project objectives. Quality of
activitiesandresultsreflectthis.”
Effectiveness (rating 2.67): Successful projects were characterised by good
beneficiary involvement, participation and communication. Secondary effects are
sometimes found, and these have beenreceived positively. Weak performers suffered
fromproblems ofpoor communicationand contact with beneficiaries. Inadequate EC
procedures werealso cited as a cause for low effectiveness.
218Bangladesh:BRACEducation Programme ALA/99/15
Sector:Healthpolicyand administrative management
The overall objective of the project is tocontribute to poverty alleviation through access to non-
formal primaryeducationfor those childrennormally outside formal schooling. The project isa
follow-up to a previous phase where non-formal primary schools were opened throughout the
country covering more than one million children. In this phase, the focus is on the provision of
an improved full rangeprimarycurriculum.
Effectiveness
“The planned beneficiaries even in remote areas have access to project benefits. A very high
level of community involvement already exists and very good communications are maintained
with planned beneficiaries. The programme has adapted very well to ensure that benefits reach
as many beneficiaries as possible. The beneficiaries themselves have a high perception of the
project benefitsexemplifiedby the fact that poor familiesprefer the project schools, whichhave
a tokencharge,unlike the freegovernment system.”
Impact(rating 2.59): Quite often, indirect and unplanned effects received high
positive ratings. Strong performance in this area was typically associated with
support to capacity building and awareness-raising, and good contacts with local
populations. Impact was sometimes low if crosscutting issues and potential linkages
toother projects and programmes were neglected.
Honduras: Desarollodela Educación en Comunidades Urbano-MarginalesenHonduras
HND/B7-310/96/204
Sector: PrimaryEducation
The projectaimstohelpmarginal urbancommunities participate more actively in the country’s
democratic, social andeconomic development.
Impact
“The project islikely to have a strong impact on itsenvironment and to contribute to its overall
objective.Communitiesare developing their capacity for self-organisation and self-management
of local policies and are likely to play a more active role in the development of civil society and
the country as such.”
Sustainability (rating 2.55): Socio-cultural (including gender), technological and
environmental issues were frequently considered to be good or very good but
financial and economic soundness was often weak. Sustainable projects tended to
interact well with policy makers to ensure high levels of policy support. Capacity
building was important at various levels, responding to local needs with high
involvement of beneficiaries in the design of the project. The findings suggest that
sustainability is likely to be weak if governments do not provide sufficient policy
support as wellas localcapacities and resources.
219Tanzania:AfricanWheelchair Users’Mobility Programme PVD/1999/284
Sector: Support toNGOs
In Africa, UNDP estimates that less than 1% of the need for wheelchairs is met through local
production, and UNESCO estimates thatless than2% of the people who need a wheelchair have
one. The project will develop the curriculum and course material for the world’s first ever
Wheelchair Workshop Manager’s Training Course (WWMTC). Likewise, the project will
locallyproduce arange of wheelchair prototypes for traininginTanzania.
Potential Sustainability
“The level of political and budgetary support from the relevant authorities and stakeholders is
high. The project is very much owned by the local stakeholders. The project clearly promotes
the participation of women in its activities. The project, which encourages the development of
local capacities and knowledge (specific training, design, production, distribution and financial
systems, institutional strengthening) will undoubtedly improve the living conditions of the final
beneficiaries”
5.3.3.2. First insights byRegion141
Five regions have been distinguished: Asia, ACP countries (Africa, Caribbean,
Pacific), Balkan countries, Latin America, and the Mediterranean region. The
number of countries visited, projects monitored and re-monitoring visits to each
country are presented in the table below. This highlights the small sample size fromwhich the conclusions have been drawn and, therefore, why the results of the
interregional comparison of levels of project performance should be treated with
caution.
Various factors may contribute to differences in observed performance between
regionalgroupsofprojects. Forexample:
•Projects inone region may have been designed and conceived earlier than in other
regions, i.e. at a period in time, when experience in project planning and
implementationwas more limited.
•Differences in average project size may also lead to differences in performance in
interregionalcomparisons.
•The sectoral distribution of projects may also lead to differences in performance
inthe interregionalcomparison.
The analysis ofthe results of monitoring in the regions is done on a fairly aggregated
level. Therefore, it is not possible to isolate the influences of individual factors.
Country-specific factors suchas strength of the localproject administration, develop-
ment orientation in government policymaking and administration, and existing
human resources and physical/organisational infrastructure for project planning and
implementation blend in with other factors such as the strength of project
management on the EC side, or the specific portfolio of projects and programmes
allocated tothat country.
141Not includingTACIS.
220If, for example, projects in sector X are particularly difficult to plan and implement,
and most projects of sector X are concentrated in region Y, then performance in
region Y may be particularly low, but the relevant determining factor for
performance will be the sector, not the region. Further analyses must be carried out,
before the impact of regional and other factors on project performance can be
assessed in a well-founded manner. For this analysis, a much more solid statistical
base ofreports willbe indispensable.
These attribution problems are another reason why the results of the interregional
comparison of levels of project performance should be treated with caution. At the
most, the current analysis may provide orientation for the preparation of further,
more in-depth investigations into the nature of project performance in specific
regions.
5.3.4. Monitoring inTACISCountries
Since 1993, the majority of TACIS projects have been subject to systematic
monitoring during their implementation, with a methodology similar to, but distinct
from, the one developed for the ALA/MED/ACP and Balkan regions. In 2001 the
three different external teams were merged and regional particularities harmonised.
In 2001, 856 monitoring reports and 543 country or sectoral notes were submitted to
the EC and other stakeholders. An assessment of project performance showed that
results were globally between ‘standard/to plan’ and ‘good’ with a tendency to
‘good’ for projects completed in2001.
FurtherSteps
Thevalueand usefulness of the monitoring system lies with the quality and
consistency of the reports. The system needs to be extended to cover the
Commission's co-operation instruments as completely as possible. As mentioned in
the beginning ofthis sub-chapter, the methodology is being continually improved on
the basis of lessons learnt and it may be further developed for the instruments of
development co-operationwhichgo beyond projects and programmes, notablysector
wide approaches and budgetary support. Where coverage by this monitoring system
is not useful or feasible for technical reasons, another more appropriate instrument
maybeneededto allowtheCommissiontobe fullyaccountable.
The system has been extended to cover as large a share of activities as is
economically reasonable, and contract management has been handed over to the
concerned geographical directorates. The challenge is now not only to ensure high
quality services, but also maintain (and, in the case of Tacis, establish) consistency of
methodology.
Several questions remain open and will have to be decided in due time, such as the
place of monitoring in a deconcentrated externalservice. There are also firmplans to
assess, after an adequate interval, the usefulness of the monitoring reports and their
application inpractice. Adelayoftwoto three years'use ofthe systemis suggested.
5.4. Conclusion
The final outcome of the Monterrey conference reflected a widely shared consensus
aboutaid effectiveness. It combines ambitious objectives in terms of more aid, a
221reduction of debt and trade barriers with a focus on results aiming at poverty
reduction.
The new concepts and agreements for which Monterrey now stands, pose challenges
for development co-operation, results-oriented monitoring and evaluation.
The challenge will be taken up on all levels, political and operational, financial and
technical. This chapter 5 deals with ambitious tools to better identify and judge
concrete results, in order to be accountable for the efforts made (manage for results),
but also steer efforts indirections yielding better results (manage byresults).
An important first step in methodologicalterms has been achieved to monitor results
benefiting the society (global goals) as well as in terms of systematically measuring
concrete improvements in the lives of people (project objectives). More work is
needed, and planned, to test and improve the methodologies and to co-ordinate with
other players in the development community.
These works on improving aid effectiveness are, also, being accompanied and
supported by efforts to improve management, and evaluate outcomes on a strategic
level, described inthe first chapterofthis report. Efforts for better programming on a
country level go hand in hand with efforts to manage more efficiently operations, in
view ofattaining the maindevelopment goals (see chapter 2).
2226. F INANCIALTABLES
Breakdownby sector ofOfficialDevelopment Assistance(ODA)
toPart Icountriesof the DAClist financedontheGeneralCommissionBudget andthe European
Development Fund (EDF) in 2001
Amount of Commitmentsinmillionsof €
Total ODA Managed by
EuropeAidManagedby
Other DG'sSector of Destination
Amount %
SOCIAL INFRASTRUCTURE AND SERVICES
Education 243.91 4.1% 232.32 11.59
Health 277.00 4.6% 277.00
Population polices/programsandreproductivehealth 173.03 2.9% 173.03
Water supplyandsanitation 224.27 3.7% 224.27
Governmentandcivil society 427.93 7.1% 276.93 151.00
Other Social Infrastructure 503.61 8.4% 348.19 3.40
Subtotal 1,849.75 30.9% 1,531.74 165.99
ECONOMIC INFRASTRUCTURE AND SERVICES
Transportandstorage 200.16 3.3% 200.16
Communications 91.37 1.5% 91.37
Energygenerationand supply 134.12 2.2% 114.12 20.00
Bankingandfinancialservices 158.42 2.6% 158.42
Business andother services 80.78 1.3% 80.78
Subtotal 664.85 11.1% 644.85 20.00
PRODUCTION SECTORS
Agriculture, Forestryand Fishing 473.68 7.9% 273.67 200.01
Industry, MiningandConstruction 234.13 3.9% 234.13
TradeandTourism 153.15 2.6% 145.36 7.79
Subtotal 860.96 14.4% 653.16 207.80
MULTISECTOR/CROSSCUTTING
Generalenvironmentalprotection 132.57 2.2% 116.86 15.71
Women in development 8.02 0.1% 8.02
Other multisector 1,047.35 17.5% 1,115.25 84.12
Subtotal 1,187.94 19.8% 1,240.13 99.83
COMMODITY AID ANDGENERALPROGRAMMEASSISTANCE
Structural adjustmentassistance with World
Bank/IMF243.14 4.1% 243.14
Development food aid/food securityassistance 211.17 3.5% 206.66 4.51
Other generalprogramandcommodityassistance 112.85 1.9% 112.85
Subtotal 567.16 9.5% 562.65 4.51
ACTION RELATING TODEBT
Subtotal 76.13 1.3% 76.13 0.00
EMERGENCY AND DISTRESSRELIEF
Subtotal 609.16 10.2% 119.62 489.54
OTHER/UNALLOCATED/UNSPECIFIED
Subtotal 178.07 3.0% 147.57 30.50
GRAND TOTAL 5,994.02 100% 4,975.85 1,018.17
223Breakdown bybudgetlineof external aidfinanced onthe
GeneralCommissionBudgetin2001
Amounts inM € Total ManagedbyEuropeAid ManagedbyotherDG's
Item Description Commitments Payments Commitments Payments Commitments Payments
B7-01.. Pre-Adhesion -SAPARD 540.00 30.53 540.00 30.53
B7-02.. Pre-Adhesion -ISPA 1,121.18 203.26 1,121.18 203.26
B7-03.. Pre-Adhesion -PHARE 1,650.69 1,167.89 1,650.69 1,167.89
B7-04.. Pre-Adhesion -Malta&Cyprus 26.30 2.53 26.30 2.53
B7-20.. Food Aid 461.39 483.86 461.39 483.86
B7-21.. Humanitarian Aid 522.99 561.08 522.99 561.08
B7-30.. Asia 407.74 383.12 407.74 383.12
B7-31.. LatinAmerica 300.20 151.94 300.20 151.94
B7-32.. South Africa 121.59 99.48 121.59 99.48
B7-4... Mediterranean 808.84 477.01 761.84 471.93 47.00 5.08
B7-42.. Near&MiddleEast 100.30 101.97 100.30 101.97
B7-51.. EuropeanBank for Reconstruction &Devt 7.43 7.43
B7-52.. NIS &Mongolia -TACIS 407.78 382.48 383.58 361.16 24.20 21.32
B7-53 NIS & Mongolia/CEEC's - Other
actions40.00 40.65 40.00 40.00 0.65
B7-54.. Balkans 824.98 920.02 704.98 844.97 120.00 75.05
B7-60.. CofinancingNGO's 197.24 161.22 197.24 161.22
B7-6002 Decentralisedco-operation 5.06 3.52 5.06 3.52
B7-61.. Training&publicawareness 3.72 2.54 3.72 2.54
B7-620. Environment/tropicalforests 42.10 33.90 42.10 33.90
B7-6211 GlobalHealth Fund 60.00 60.00
B7-63.. Social infrastructure&services 26.75 11.19 26.75 11.19
B7-6510 Coordination/evaluation/inspectio
n9.92 8.59 9.92 8.59
B7-6610 Anti-personnelmines 12.00 4.07 12.00 4.07
B7-66.. Otherspecificactions 55.87 70.30 2.26 22.11 53.61 48.19
B7-6710 Rapidinterventionoperations 19.98 6.20 19.98 6.20
B7-70.. Democracy&Human Rights 104.72 54.06 104.72 54.06
B7-80.. Internationalfishingagreements 194.30 191.96 194.30 191.96
B7-8710 BananasACP 43.50 16.86 43.50 16.86
B7-8... Other external chapters of
Communitypolicy32.94 25.14 1.91 2.55 31.03 22.59
B8-0… Common Foreign & Security
Policy32.67 29.50 32.67 29.50
Total TitleB7-B8 8,174.75 5,632.30 3,823.47 3,288.54 4,351.28 2,343.76
224Breakdown byinstrumentof developmentassistancefinanced onthe
European DevelopmentFund(EDF) in2001
Amounts inM € Total ManagedbyEuropeAid Managedby
other DG's
Instrument Commitments Payments Commitments Payments Commitments Payments
Programmed aid 869.94 752.52 869.94 752.52
StructuralAdjustment 215.46 303.76 215.46 303.76
RiskCapital 383.47 183.46 383.47 183.46
Interest Rebates 16.33 15.57 16.33 15.57
EmergencyAid 11.90 30.48 11.90 30.48
Aid torefugees 41.14 7.95 41.14 7.95
Sysmin -0.28 48.18 -0.28 48.18
Stabex 353.22 353.22
HIPC 350.00 350.00
Others 16.20 22.72 16.20 22.72
Total EDF 1,554.16 2,067.86 1,554.16 2,067.86 0.00 0.00
Grand TotalBudget + EDF 9,728.91 7,700.16 5,377.63 5,356.40 4,351.28 2,343.76
225Breakdown bycountry/region ofexternalaidfinancedonthe
General CommissionBudget andtheEuropean DevelopmentFund(EDF) in2001
Country/Region Commitments Payments Commitments Payments Commitments Payments
PartI: DevelopingCountries&Territories
OfficialDevelopment Assistance(ODA)
Europe, Total 1,212.75 1,192.71 907.36 949.00 305.39 243.71
Albania 41.45 61.47 36.45 57.30 5.00 4.17
Bosnia-Herzegovina 141.99 168.61 136.24 152.74 5.75 15.87
Croatia 60.61 14.40 60.61 14.40 0.00 0.00
Macedonia(FYROM) 83.84 48.92 57.20 27.69 26.64 21.23
Malta 8.14 3.98 0.64 0.44 7.50 3.54
Moldova 20.95 5.18 20.17 4.18 0.78 1.00
Slovenia 52.22 51.07 0.00 0.00 52.22 51.07
Turkey 203.00 91.33 156.00 86.62 47.00 4.71
Federal Republicof
Yugoslavia548.89 686.37 388.39 595.81 160.50 90.56
States of Ex-Yugoslavia
Unspecified0.00 51.59 0.00 0.03 0.00 51.56
Europe Unallocated 51.66 9.79 51.66 9.79 0.00 0.00
Africa, Total 2,038.11 2,261.32 1,730.97 1,947.83 307.14 313.49
North Of Sahara, Total 319.07 246.80 302.74 229.61 16.33 17.19
Algeria 79.37 23.64 63.04 6.45 16.33 17.19
Egypt 1.79 88.16 1.79 88.16 0.00 0.00
Morocco 122.42 60.80 122.42 60.80 0.00 0.00
Tunisia 91.60 74.19 91.60 74.19 0.00 0.00
North ofSahara
Unallocated23.89 0.01 23.89 0.01 0.00 0.00
South ofSahara,Total 1,719.04 2,014.52 1,428.23 1,718.22 290.81 296.30
Angola 68.25 67.69 31.27 27.83 36.98 39.86
Benin 11.89 49.28 11.89 49.28 0.00 0.00
Botswana 1.99 4.87 1.99 4.87 0.00 0.00
BurkinaFaso 29.32 42.00 29.32 42.00 0.00 0.00
Burundi 20.73 70.60 0.73 56.26 20.00 14.34
Cameroon 66.80 46.66 66.80 46.66 0.00 0.00
CapeVerde 1.05 3.08 1.05 3.07 0.00 0.01
Central African Republic -1.47 17.42 -1.47 17.42 0.00 0.00
Chad 40.88 42.49 40.88 42.21 0.00 0.28
Comoros 2.02 4.38 1.67 2.46 0.35 1.92
Congo, Democratic
Republic54.56 49.13 19.56 20.05 35.00 29.08
Congo, Rep. -8.20 3.66 -8.20 2.49 0.00 1.17
Djibouti 0.57 7.62 0.57 7.62 0.00 0.00
Equatorial Guinea 3.09 3.23 3.09 3.23 0.00 0.00
Eritrea 24.78 26.20 24.78 23.92 0.00 2.28
Ethiopia 69.46 116.36 62.76 105.56 6.70 10.80
Gabon 16.35 20.32 16.35 19.99 0.00 0.33
Gambia 5.46 5.13 5.46 5.13 0.00 0.00
Ghana 51.20 27.22 51.20 27.22 0.00 0.00
Guinea 56.21 23.56 48.38 17.23 7.83 6.33
Guinea-Bissau 22.45 20.19 5.95 7.85 16.50 12.34
IvoryCoast 14.06 91.13 12.52 89.89 1.54 1.24
Kenya 13.95 90.44 10.95 88.60 3.00 1.84
Lesotho 22.64 10.33 22.64 10.33 0.00 0.00
Liberia 24.94 9.85 24.94 9.85 0.00 0.00
Madagascar 82.17 64.91 80.44 62.86 1.73 2.05
Malawi 43.70 78.39 43.70 78.39 0.00 0.00
Mali 58.90 45.63 58.90 45.63 0.00 0.00
Mauritania 119.44 130.32 33.44 44.16 86.00 86.16
Mauritius 5.41 9.25 5.20 9.03 0.21 0.22
Mayotte 0.45 1.51 0.45 1.51 0.00 0.00
Mozambique 67.76 72.55 65.76 69.04 2.00 3.51
Namibia 16.51 21.44 16.51 21.40 0.00 0.04
Niger 13.91 44.43 13.91 44.08 0.00 0.35
226Nigeria 66.96 26.72 66.96 26.72 0.00 0.00
Rwanda 2.89 50.51 2.89 50.36 0.00 0.15
St. Helena -0.08 0.00 -0.08 0.00 0.00 0.00
SaoTome &Principe 2.07 5.74 1.75 5.42 0.32 0.32
Senegal 28.59 34.98 20.59 26.97 8.00 8.01
Seychelles 2.26 4.99 -0.04 0.93 2.30 4.06
SierraLeone 14.87 45.56 3.87 33.66 11.00 11.90
Somalia 5.56 27.86 3.86 22.54 1.70 5.32
South Africa 133.18 110.78 133.18 110.78 0.00 0.00
Sudan 21.81 25.44 4.81 9.49 17.00 15.95
Swaziland 0.77 12.89 0.77 12.89 0.00 0.00
Tanzania 166.41 113.73 134.26 88.45 32.15 25.28
Togo 1.64 5.41 1.64 5.41 0.00 0.00
Uganda 70.00 77.01 70.00 76.60 0.00 0.41
Zambia 59.61 58.04 59.61 57.91 0.00 0.13
Zimbabwe 33.69 20.52 33.19 20.27 0.50 0.25
South ofSahara
Unallocated87.58 73.07 87.58 62.70 0.00 10.37
America,Total 656.90 424.61 613.12 387.89 43.78 36.72
North &Central, Total 373.01 248.60 349.14 227.48 23.87 21.12
Anguilla -0.01 0.10 -0.01 0.10 0.00 0.00
Antigua &Barbuda -0.13 0.19 -0.13 0.19 0.00 0.00
Barbados 6.51 0.48 6.51 0.48 0.00 0.00
Belize 6.53 7.12 6.03 6.87 0.50 0.25
Costa Rica 9.60 1.41 9.60 1.41 0.00 0.00
Cuba 19.11 13.40 10.85 5.88 8.26 7.52
Dominica 11.86 5.99 11.86 5.99 0.00 0.00
Dominican Republic 20.98 15.35 20.76 15.13 0.22 0.22
El Salvador 55.32 17.75 45.32 10.60 10.00 7.15
Grenada 0.50 0.37 0.50 0.37 0.00 0.00
Guatemala 29.67 22.63 28.90 22.43 0.77 0.20
Haiti 13.19 18.46 13.19 18.41 0.00 0.05
Honduras 7.73 16.42 6.70 15.04 1.03 1.38
Jamaica 29.43 48.79 29.17 48.79 0.26 0.00
Mexico 4.85 4.58 3.05 3.62 1.80 0.96
Montserrat 0.00 0.19 0.00 0.19 0.00 0.00
Nicaragua 45.07 34.85 44.04 33.73 1.03 1.12
Panama 9.32 3.32 9.32 3.32 0.00 0.00
St.Kitts-Nevis 0.00 4.11 0.00 4.11 0.00 0.00
St. Lucia 12.03 18.27 12.03 18.27 0.00 0.00
St.Vincent&Grenadines 6.38 4.13 6.38 4.13 0.00 0.00
Trinidad&Tobago 0.41 1.06 0.41 1.06 0.00 0.00
Turks &Caicos Islands 3.00 0.22 3.00 0.22 0.00 0.00
North &CentralAmerica
Unallocated81.66 9.41 81.66 7.14 0.00 2.27
South, Total 195.56 140.48 175.65 124.88 19.91 15.60
Argentina 1.15 8.69 1.15 8.69 0.00 0.00
Bolivia 9.75 29.83 8.68 29.14 1.07 0.69
Brazil 6.40 17.12 6.40 16.69 0.00 0.43
Chile 3.27 8.77 3.27 8.77 0.00 0.00
Colombia 54.86 17.52 41.54 8.62 13.32 8.90
Ecuador 22.86 6.36 22.23 5.59 0.63 0.77
Guyana 21.36 10.16 21.36 10.12 0.00 0.04
Paraguay 2.23 8.94 1.25 8.31 0.98 0.63
Peru 13.04 23.88 9.40 21.32 3.64 2.56
Suriname 16.72 1.73 16.72 1.73 0.00 0.00
Uruguay 1.61 2.18 1.61 2.18 0.00 0.00
Venezuela 38.29 5.30 38.02 3.72 0.27 1.58
South AmericaUnallocated 4.02 0.00 4.02 0.00 0.00 0.00
America Unspecified 88.33 35.53 88.33 35.53 0.00 0.00
Asia, Total 955.66 870.13 746.95 686.33 208.71 183.80
Middle East, Total 188.09 182.90 155.31 157.57 32.78 25.33
Iran 2.65 1.73 2.65 1.73 0.00 0.00
Iraq 12.89 12.70 0.01 0.15 12.88 12.55
Jordan 20.83 20.15 20.83 19.65 0.00 0.50
227Lebanon 5.83 9.69 5.83 8.35 0.00 1.34
PalestinianAdmin. Areas 86.58 123.41 68.57 114.81 18.01 8.60
Syria 8.11 6.40 8.11 5.94 0.00 0.46
Yemen 18.25 8.56 16.36 6.89 1.89 1.67
Middle East Unallocated 32.95 0.26 32.95 0.05 0.00 0.21
South &Centr. Asia, Total 466.67 409.96 341.70 310.51 124.97 99.45
Afghanistan 86.01 51.13 29.43 16.95 56.58 34.18
Armenia 17.80 11.35 10.20 9.78 7.60 1.57
Azerbaijan 1.60 14.27 1.60 12.79 0.00 1.48
Bangladesh 106.70 82.55 106.06 80.95 0.64 1.60
Bhutan 0.00 1.78 0.00 1.78 0.00 0.00
Georgia 42.35 26.21 29.80 18.21 12.55 8.00
India 110.85 83.98 95.06 67.77 15.79 16.21
Kazakhstan 14.40 4.92 14.40 4.92 0.00 0.00
KyrgyzRep. 19.30 12.55 19.30 12.37 0.00 0.18
Maldives 0.00 0.06 0.00 0.06 0.00 0.00
Myanmar (Burma) 3.98 4.29 1.99 2.75 1.99 1.54
Nepal 7.44 12.40 4.75 10.71 2.69 1.69
Pakistan 32.61 50.23 26.90 50.03 5.71 0.20
SriLanka 4.38 7.90 1.96 6.26 2.42 1.64
Tajikistan 19.25 32.25 0.25 5.43 19.00 26.82
Turkmenistan 0.00 2.93 0.00 2.93 0.00 0.00
Uzbekistan 0.00 6.82 0.00 6.82 0.00 0.00
South & Central Asia
Unallocated0.00 4.34 0.00 0.00 0.00 4.34
Far East, Total 217.23 230.82 166.27 171.80 50.96 59.02
Cambodia 18.60 27.01 13.70 23.47 4.90 3.54
China 46.27 26.39 44.12 24.03 2.15 2.36
EastTimor 41.94 30.70 30.82 30.70 11.12 0.00
Indonesia 34.13 31.68 32.23 11.51 1.90 20.17
Korea, Dem. 43.55 45.04 20.18 21.44 23.37 23.60
Laos 1.66 9.24 1.66 9.11 0.00 0.13
Malaysia 0.00 0.41 0.00 0.41 0.00 0.00
Mongolia 1.03 4.08 0.00 2.42 1.03 1.66
Philippines 7.44 21.25 5.98 19.51 1.46 1.74
Thailand 6.53 10.88 2.03 6.01 4.50 4.87
VietNam 15.66 23.73 15.13 23.19 0.53 0.54
FarEastAsiaUnallocated 0.42 0.41 0.42 0.00 0.00 0.41
Asia Unspecified 83.67 46.45 83.67 46.45 0.00 0.00
Oceania,Total 65.82 68.96 65.74 68.96 0.08 0.00
Cook Islands 0.00 0.00 0.00 0.00 0.00 0.00
Fiji 10.71 0.94 10.63 0.94 0.08 0.00
Kiribati 6.60 0.41 6.60 0.41 0.00 0.00
Marshall Islands 0.00 0.00 0.00 0.00 0.00 0.00
Micronesia,Fed.Sts. 0.00 0.00 0.00 0.00 0.00 0.00
Nauru 0.00 0.00 0.00 0.00 0.00 0.00
Niue 0.00 0.00 0.00 0.00 0.00 0.00
Palau 0.00 0.00 0.00 0.00 0.00 0.00
PapuaNewGuinea -0.18 13.81 -0.18 13.81 0.00 0.00
Samoa 3.08 11.35 3.08 11.35 0.00 0.00
Solomon Islands 0.22 35.43 0.22 35.43 0.00 0.00
Tonga 6.25 0.24 6.25 0.24 0.00 0.00
Tuvalu 0.00 1.42 0.00 1.42 0.00 0.00
Vanuatu 2.96 4.96 2.96 4.96 0.00 0.00
Wallis&Futuna 3.92 0.00 3.92 0.00 0.00 0.00
OceaniaUnallocated 32.26 0.40 32.26 0.40 0.00 0.00
LDC's Unspecified 857.53 578.07 704.46 433.86 153.07 144.21
Multilateral Aid 207.25 495.96 207.25 495.96 0.00 0.00
UNRWA 57.25 54.58 57.25 54.58 0.00 0.00
WFP 90.00 91.38 90.00 91.38 0.00 0.00
HIPC 0.00 350.00 0.00 350.00 0.00 0.00
GHF 60.00 0.00 60.00 0.00 0.00 0.00
PartI(ODA),Total 5,994.02 5,891.76 4,975.85 4,969.83 1,018.17 921.93
228PartII:Countries and Territoriesin Transition
OfficialAid(OA)
More Advanced DevelopingCountries 42.59 47.22 11.84 17.26 30.75 29.96
Aruba 0.50 0.29 0.50 0.29 0.00 0.00
Bahamas -1.03 0.84 -1.03 0.84 0.00 0.00
Bermuda 0.00 0.00 0.00 0.00 0.00 0.00
Brunei 0.00 0.00 0.00 0.00 0.00 0.00
Cayman Islands 0.10 0.00 0.10 0.00 0.00 0.00
ChineseTaipei(Taiwan) 0.00 0.00 0.00 0.00 0.00 0.00
Cyprus 18.80 3.58 0.00 0.00 18.80 3.58
Falkland Islands 0.00 0.00 0.00 0.00 0.00 0.00
FrenchPolynesia -0.01 6.16 -0.01 6.16 0.00 0.00
Gibraltar 0.00 0.00 0.00 0.00 0.00 0.00
HongKong. China 0.00 0.00 0.00 0.00 0.00 0.00
Israel 15.01 29.91 3.06 3.53 11.95 26.38
Korea 0.00 0.00 0.00 0.00 0.00 0.00
Kuwait 0.00 0.00 0.00 0.00 0.00 0.00
Libya 0.00 0.00 0.00 0.00 0.00 0.00
Macao 0.00 0.10 0.00 0.10 0.00 0.00
Netherlands Antilles -0.20 4.84 -0.20 4.84 0.00 0.00
New Caledonia 9.46 0.27 9.46 0.27 0.00 0.00
NorthernMarianas 0.00 0.00 0.00 0.00 0.00 0.00
Qatar 0.00 0.00 0.00 0.00 0.00 0.00
Singapore 0.00 0.00 0.00 0.00 0.00 0.00
UnitedArab Emirates 0.00 0.00 0.00 0.00 0.00 0.00
VirginIslands(UK) -0.04 1.23 -0.04 1.23 0.00 0.00
MADCT Unallocated 0.00 0.00 0.00 0.00 0.00 0.00
CEEC's/NIS 3,692.30 1,761.18 389.94 369.31 3,302.36 1,391.87
Belarus 1.12 3.57 0.92 3.38 0.20 0.19
Bulgaria 348.45 155.27 1.07 0.13 347.38 155.14
Czech Republic 178.06 89.33 0.38 0.70 177.68 88.63
Estonia 70.15 30.53 0.00 0.09 70.15 30.44
Hungary 242.18 185.90 0.53 0.00 241.65 185.90
Latvia 117.14 53.76 0.00 0.00 117.14 53.76
Lithuania 186.10 68.33 0.00 0.16 186.10 68.17
Poland 1,049.82 315.85 0.28 0.04 1,049.54 315.81
Romania 691.91 243.89 0.00 0.80 691.91 243.09
Russia 152.65 109.37 112.30 84.84 40.35 24.53
Slovak Republic 148.58 66.17 0.00 0.13 148.58 66.04
Ukraine 109.83 108.70 108.91 107.31 0.92 1.39
CEEC's Unallocated 230.56 136.07 0.00 0.00 230.56 136.07
NIS Unallocated 165.12 178.76 164.92 171.73 0.20 7.03
CEEC's/NIS Unallocated 0.63 15.68 0.63 0.00 0.00 15.68
Part II (OA), Total 3,734.89 1,808.40 401.78 386.57 3,333.11 1,421.83
Grand TotalPart I &Part II (ODA+OA) 9,728.91 7,700.16 5,377.63 5,356.40 4,351.28 2,343.76
2297. A NNEXES
These pages cover a series of activities undertaken in 2001 in the context of the EC Reform
described in chapter 1. The first section gives details of developments in the process of
harmonisation of contract and financial procedures. The second section gives a picture of the
financial backlog as on 31 December 2000 and progress with the reduction of this backlog.
Subsequent sections deal with other important activities related to the reform, such as, audit,
EuropeAid’s innovation unit, the EC’s relationship with other major international donors and
stepstakentowards greatertransparencyand visibility.
7.1. Harmonisation ofcontract and financialprocedures
2001 saw further significant developments in the harmonisation of contract and
financialprocedures.
EuropeAid Co-operation Office implemented the Practical Guide to EC external aid
contract procedures in the co-operation programmes and various beneficiary
countries within its area of competence. This activity involved training sessions in
Brussels and inCommission Delegations (see figures below). This Guide also set out
howtotransfer managementoftheprojectsinthebeneficiarycountries inthe context
ofdevolution.
The EuropeAid Co-operation Office Finance Guide applicable to the external actions
financed from the general budget of the European Communities and the updated
Finance Guide applicable to the actions financed from the 7thand 8thEDF were
finalised in December 2001. These guides, which are available for consultation on
the Office’s intranet, explain and document existing financial procedures. The new
financial circuits for commitments, contracts, payments, recoveries and closure of
commitments regarding the actions financed from the general budget, which were
approved/laid down by the Office’s management in June and November 2001, are
described in detail. Finally, both guides take into account the new division of duties,
powers and responsibilities between Headquarters and Delegations in the framework
ofthe devolutionprocess.
On 8 November 2001, the Commission and the World Bank signed a Trust Funds
and co-financing Framework. This contains contract templates to be used in cases
wheretheCommissioncontributesto single-donor as wellas multi-donortrust funds.
C o - o p e r a t i o nb e t w e e nt h eC o m m i s s i o na n dt h eW o r l dB a n kw i l ln o wr u nm o r e
smoothly. EuropeAid Co-operation Office also signed, in the name of the
Commission, an agreement with the UN on the implementing modalities of the 1994
verification clause agreement. This issue had long been a stumbling block in the
relations between the EC and the UN. The outcome of this agreement has allowed
the parties to embark upon a more substantial revision of the 1999 EC-UN
framework agreement, in order to adapt it to the stronger partnership that they are
willing to build.
Training
In2001, the following specific training activities have beencarried out byEuropeAid
Co-operation office:
230PracticalGuide to EC externalaid contract procedures.
Brussels: 8 sessions for atotalof260 persons
Delegations:3 missions foratotalof124persons
Financial implementation.
Brussels: 4 sessions for atotalof100 persons.Otherfigures
In2001, EuropeAid Co-operationOffice handled (Budget &EDF)
•more than 26,000 payments totalling
€5,2 billion
•more than1,600 commitmentstotalling €5,6 billion
Data concerning the Web-site ofEuropeAid Co-operationOffice in2001:
•with reference to the rubric “Tenders & Grants”, the number of documents
published in2001 is 3 270 (ofwhich891 are calls for tender &calls for proposal)
•hits (per month) more than 4 million.
•htmlpages downloaded (per month) morethan700,000
7.2. ExternalAid and “RAL”
‘RAL’ is the amount of committed money that has not yet been paid. The term
comes from the French reste à liquider or rest to be paid. It is the sum of total
amounts committed inthe past budgetaryyears, minus the totalamounts disbursed or
de-committed.
Its existence derives from the budgetary concepts enshrined in the Financial
Regulation, as article 1.§4 provides for two types of appropriations for actions
running for morethanone budgetaryyear:
•commitment appropriations, setting annual limits for the commitments which will
be entered into withthird parties,
•payment appropriations, which are meant to cover the disbursements to these third
parties foreseen inanygiven year.
Some of the RAL is legitimate, as commitments are made in anticipation of
payments to be made in the future. The Commission uses the terms ‘old’ and
‘dormant’ to describe the money that genuinely makes up a payment backlog. Old
commitments are commitments made more than five years ago, and dormant
commitments are commitments on which no action has been taken for the last two
years.
The overall reduction of RAL was a priority prior to the creation of the EuropeAid
Co-operation Office. All old and dormant commitment are under review, and this
231process continued throughout 2001, as well as the monitoring of their level in the
overallport-folio.
7.2.1. Old Commitments
As we moved into 2001, commitments made in 1995 were added to the stock of old
commitments.
7.2.1.1. Priorto 1995
– An initial inventorywas made in November 1999 ofthe budget lines covering EC
external assistance under category IV of the budget. (This covers Asia, Latin
America, MediterraneanCountries, theBalkansandCentralandEasternEurope.)
– RAL decreased by 60 %, from €1,092.34 million to €429.7 million. This derives
both from payments ( €301.85 million) and de-commitments ( €360.80 million)
The number ofbudget commitments withoutstanding balances decreased by 67%,
from 1,662 to 548. Since the initial inventory, a total of 1,114 budget
commitments prior to 1995 have been closed in the accounting system (no
outstanding balances by the end 2001), either by full payment and/or de-
commitment; their respective RAL at the initial point of reference was €251
million.
– Considering the commitments already de-committed (1,114), plus the
commitments reviewed or under review (536), by the end of 2001, action had
been taken on 99,2%ofthe initialstockofold commitments to be reviewed .
7.2.1.2. Year 1995
Commitments from year 1995 were added in 2001 to the systematic review exercise.
During the past year:
The RAL in financial volume decreased by 31%, from €656.8 million to €456
million.
The number of budget commitments with outstanding balances decreased by 42%,
from524 to 305;
During 2001, atotalof 219 budget commitmentsfromyear1995 have been closed
in the accounting system (no outstanding balances by the end 2001), either by full
payment and/or de-commitment; their respective RAL at the beginning of 2001 was
€43.3million.
The RAL reduction of €200.8 million for budget year of origin 1995 derives both
frompayments ( €106.3 million), and also from significant de-commitments ( €94.59
million).
Considering the commitments already de-committed (219), plus the commitments
reviewed or under review (283), action has been taken on 96% of the stock of the
year95 added in 2001tothereview exercise
7.2.1.3. Prospects forthe commitments stilloutstanding (priorto 95 +year 95)
Reported as ongoing
232– According to the reporting data received, 97 budget commitments prior to 1995
are related to ongoing projects with underlying legally binding obligations. These
commitments account for €313.23 million, that is 73% ofthe RAL at year-end.39
commitments, amounting to €131 million, have had their final due dates
extended. Almost all of these commitments in that case are in Asia and the
Mediterranean. Decisions to extend were made on a case-by-case basis. Some had
suffered considerable start-up delays but were now proceeding in order to meeting
expectations raised in partner countries. Some have been re-launched on the basis
ofnew analysis.
– For 1995, the proportionofongoing RAL is still high: 87 commitments for a RAL
of €352 million(77%).
Files to be closed
The majority of pre-1995 commitments (accounting for only a small proportion of
the RAL) were found not to be covering ongoing projects and are in the process of
being closed. The same is true for year 1995 (180 commitments for €82.6 million of
RAL). 449 pre-1006 commitments are to be closed. Prioritywill be given to this task
in the first half of the 2002. Some of these files have already been de-committed to €
1 (63 commitments priorto 1995 and 8 from1995).
7.2.1.4. Overallevolutionofold commitments 1999-2001
The table hereafter shows the evolution over the past two years of the outstanding
commitments that will be considered “old” in 2002. It gives evidence of the
continuing effortsofthe managing services in order to proceed with the closing of an
important number ofcommitments, even before they enter into the category “old”, as
partofnormalmanagement procedures.
EuropeAid only 23/11/99 31/12/99 31/12/00 31/12/01
Nbrcommitments 1663 1497 841 548 Priorto1995 RAL (M
€) 1,092.65 1,015.44 741.02 429.7
Nbrcommitments 761 524 305 Budget
Year 1995 RAL (M €) 936.74 656.87 455.98
Nbrcommitments 1109 776 509 Budget
Year 1996 RAL (M €) 1,249.23 928.25 685.98
1663 1497 1365 1362 TOTAL
OLDNbr commitments
RAL1,092.65
M €1,015.44
M €1,397.89
M €
(+37%)1,571.66
M €
(+12%)
7.2.2. Dormant commitments
Final data for 2001 show a total of 1,482 dormant budget commitments in the
accounting system, representing an amount outstanding of €1,319 million which is
an improvement compared to the levelofend 2000 (a 15% decrease in the totalRAL
and a 20 % reduction in the total number of dormant commitments). The slight
degradation observed end 2000 has thus been reversed, as can be seen in the table
hereafter showing the evolution inthe period 1999-2001.
233DORMANT end 1999 End 2000 end 2001
Number of
commitments2,223 1,932 1,482
Not old 1,180 1,055 735
TOTALRAL(inM €) 1,537 1,558 1,319
Not old 1,314 1,350 1,029
“not old” 95/96/97 96/97/98 97/98/99
It is worth noting that the stock of commitments is not the same as at the beginning
of2001. Manyofthose commitments are now no longer dormant. Meanwhile, others
have become dormant. In fact, if one considers only the evolution of the dormant
stock at the beginning of 2001, the decrease was very substantial: €815 million;
however, this reduction was partially cancelled by the adding of commitments from
budget year 1999 with no movement yet: €576 million. Hence, the net reduction for
the dormant RAL at the end of2001 amountedto €239 million.
When analysing dormant commitments by budget years of origin, the pattern already
described previously has not fundamentally changed: a major percentage of the
amounts outstanding (78% in 2001) and half of the total number of dormant
commitments is fromthe more recent years (97/98/99).
If one analyses the distribution by the criterion of disbursement (payments already
made or zero disbursement), another feature previously identified remains roughly
unchanged, i.e. a major proportion of the outstanding dormant amounts (RAL) is
related to commitments which have had no payments: 20 % of the dormant
budgetary commitments have had no payments, representing 80 % of the dormant
RAL (the proportion a year earlier was respectively 19% and 81% of the RAL). The
proportion remaining unchanged, the total amount of dormant RAL related to
commitments with no disbursements has of course decreased in line with the overall
decrease, from €1,256 million to €1,061 million. This latest figure is still too high .
The ultimate goal is of course to have no dormant commitments with zero
disbursements, its operationaltranslation being to be able to get the projects going on
the ground less than two years after the year of budget commitment of funds, save
for really force majeure circumstances.
The analysis per region yields more or less the same results as last year: budget
chapter B7-4 (Mediterranean) represents half of the total dormant amounts and 55%
of the dormant RAL related to commitments with no payments. A group of 4 major
programs (Mediterranean, Asia and Latin America co-operation lines, and Food Aid)account for 90% of the total dormant RAL and 84% of the part related to
commitments with no payments.
When comparing data at end 2000 with 2001, Asia co-operation budget lines have
had the most significant decrease ofdormant RAL: -59%.
The figures for the Mediterranean chapter require an explanation: the total amount
for B7-4 has increased from
€576 million to €667 million. This is due however to
234the commitments for Turkey on the MEDA budget line managed by DG
Enlargement, which have significantly increased as a result of adding budget year
1999. If Turkey budget commitments are excluded, a decrease, though modest, has
actuallyoccurred: from €519 millionto €508 million.
The figure for the aggregated chapter B7-6 also requires further analysis by budget
line: budget line environment and tropical forests (B7-6200) accounts for a
significant part, €61.7 million out ofthe totalof €104 million (60% ofthe RAL and
aquarterofthe dormant commitments). More significant,the percentage inthe “zero
disbursement commitments” is higher still: 79% of the amounts come from this
budget line. The level of dormant commitments with no payments for B7-6200 ( €
43.7 million) is the highest among all budget lines and chapters, when related to thelevel of commitment appropriations (in 2001 and also for 2002). It exceeds one full
year of new appropriations in the budget (
€40 million), and is thus a symptom of
implementationdifficulties.
Analysis of the dormant budget commitments for this budget line undertaken during
2001 showed a pattern of ill-prepared financing decisions: projects not well defined
enoughrequiring designing after the decisionand thus far fromready for contracting.
Weak follow-up of the portfolio to be implemented also translated in a build-up of
stalled non contracted projects with the correspondent dormant budget commitments.
The analysis of all dormant commitments undertaken in 2001 is to be followed in
2002 by a significant level of de-commitments of dormant non contracted projects,
particularly from1996, 1997 and 1998.
The systemic management measures already taken in 2001 aimed at ensuring the
maturity of projects submitted to the Commission for decision, that is, commitment
of projects technically far advanced for contracting within one year after decision.
Furthermore in2001 for the first time, a formalcall for proposals was launched, with
standardised submission documents and selection criteria aimed at ensuring receipt
of mature project proposals. A first group of selected projects was financed with
2001 appropriations, and a second group willbe financed with2002 appropriations.
7.2.3. Evolution of “abnormal”RAL(dormant+old)
“Abnormal” RAL has been defined as comprising “old” commitments or “dormant”
commitments.
The percentage of “abnormal” RAL (old + dormant not included in “old”) was 23%
at the beginning ofyear 2000; it has decreased to 21%, with 1996 already included in
“old” and excluding the Turkey MEDA portfolio not managed by EuropeAid Co-operation Office. If the latter is included, the ratio is 22% (due to the high level of
dormant commitments for Turkey).
It should be noted that, for the portfolio managed by EuropeAid, ratios for both
decreased: the RAL (with a slight decrease in absolute terms) and the “abnormal”
part, with a particularly significant decrease in dormant commitments. Given both
factors, this result is to be considered a real improvement (a decrease of the ratio
resulting froman increase inthe overallRAL would not necessarilybe a progress).
In terms of number of commitments, the ratio appears as having deteriorated (from
34% to 36% of commitments in old or dormant categories). Again, the evolution of
each part of the ratio must be analysed. The absolute number of old or dormant
235commitments has actually significantly decreased by 14%, even considering the
adding of budget year 96 as old. However the total number of commitments has
sharply decreased, in part due to closures, but also due to the introduction in 2001 of
a new concept of pre-commitment (global commitment) in the accounting system
Sincom2, greatly used in the external actions. Only the pre-commitments plus the
individual commitments are counted (not the secondary commitments on pre-
commitments).
7.2.4. The effort on closure and de-commitment
The level of de-commitment during 2001 for EuropeAid’s management portfolio
reached €591 million. This was a result, not only of closure of old files, but also of
the overall effort of review for the whole open portfolio. The part of old
commitments prior to 96 amounts to €290.78 million (196.18 prior to 95 plus 94.59
from budget year 95), roughly half of the total amount de-committed in 2001. De-
commitment in financial amounts can derive from partial de-commitments or from
closureofcommitmentsfor whichremainingbalancesare fullyde-committed.
The effort on closure is best represented by those commitments which are totally
paid and/or de-committed during the year, leaving no amounts outstanding (RAL
zero) and not carried inthe next financialyear.
7.2.5. Conclusions
Overall results and generalcomments
After 2 years of continuous work by the operational financial units on old
commitments, a significant reduction of the accumulated backlog on closure
operations has been achieved.On dormant commitments, a reduction year-on-year has been achieved, as well as
compared to 1999 (a slight increase had occurred in 2000), and, if only the
EuropeAid portfolio is considered, the level is now under 1 billion €of dormant
amounts. The slight degradation observed last year has been reversed.
On both counts, there is real quantitative and significant progress, both on figures
and on awareness of the necessity of monitoring the stock of open budget
commitments and ofthe fact that it cannot have unlimited growth.
On a more general level, however, it would seem important to continue to address in
parallel the systemic factors that allowed such a big backlog to build up over the
years. Three key factors of equal importance can be singled out: the lack of a
commoncomputerised reliable information systemcovering all aspects of the project
cycle and supporting management decisions, a significant lack of human resources
for managing an ever growing number of projects, the minor importance given in the
past by the top-level management to the complete management aspects of the
portfolio (the launching of new initiatives being often considered as a nobler task
than bringing the current ones to a successful end). These factors are all the more
critical in an organisation with a great degree of geographical and functional
decentralisation, and particularlythe computerised informationsystems.
For dormant commitments, the major part in financial volume, as repeatedly stated,
are commitments with zero payments from the major geographical co-operation
236programs. Addressing this problem means shortening the time between decision,
budget commitment, signing of Financing Agreements and contracting and
disbursing.
The time delay for signing the Financing Agreements and for contracting the
European technical co-direction and setting up the joint management structure with
the beneficiary country appears to be part of the critical points in the whole process,
as they take place after budget commitment. As to the Financing agreements, they
should be negotiated and ready for signature at the moment of budget commitment.
Regarding the technical assistance, the terms of reference should be prepared in
parallel with the internal Commission’s Financial Decision in order to allow for a
quick start. Perhaps one could think also if it is really necessary or efficient to build
eachtime such a structure fromscratch and if it wouldn’t be possible to rely more on
local capacity, both from the now de-concentrated delegations and the beneficiary’s
administration, either ownor seconded byforeignaid.
A major development in this respect in the near future is the modification of the
Financial Regulation and the “n+3” deadline for contracting after year of budget
commitment. This will no doubt entail significant changes in the way projects are
planned and their scope. Major programs will have to be thought in a phased way,
with perhaps successive shorter phased projects, with self-contained physically and
financiallycontrollable items, inscribed ina consistent mediumtermprogramming.
7.3. Evaluation Activities
7.3.1. Findings from the 2001Evaluations
Human Rights, Good Governance and Democracy : these evaluations showed that
there was some wayto go before HumanRights were established at everylevel in the
Commission as a true “crosscutting issue” with a common purpose and uniform
policyinput to all co-operation programmes and politicalrelations. Clearly, there is a
need for the Commission to define better the frontiers of Human Rights, democracy
and good governance, and to ensure that the roles of the different Human Rights
units within the Commission are better understood. There is also a need to limit the
priorities of the Human Rights budget lines to ensure that, when objectives are
identified for action, sufficient resources are devoted to their achievement. This
could mean establishing country and regional objectives and improving
complementarity with Member States, NGOs and other bodies. Parts of the findings
were takenonboard inthe CommissionCommunicationof8 May2001142.
142COM(2001)252 Finaldated8 May2001
237EVALUATIONS COMPLETEDIN 2001
1.Review of evaluation activities on Human Rights, good governance and
democracy
1.1 Evaluationof PositiveHRD actions inACP states 1995-99
1.2 Evaluationof Joint EC/Councilof Europeprogrammes 1995-2001
1.3 Evaluationof Voter Education Actions 1992-2000
1.4 Synthesis report onHumanRights, goodgovernanceand democracy
2. Review ofevaluation activities oneconomic co-operation
2.1 Evaluation of financial assistance for the Mediterranean countries managed by the
EuropeanInvestment Bank(EIB) onbehalf of theEC
2.2 Evaluation of economic co-operation between the EC and Partner States in Asia and
LatinAmerica (ALA)
2.3 TACIS EnterpriseRestructuringFacility(TERF)–RussianFederation
2.4 TheCross-Border Initiative(CBI)
3. Review ofevaluations related to poverty reduction
3.1 Evaluation of EC Food Aid Security Policy, Food Aid Management and Programmes
insupport of FoodSecurity
3.2 Evaluation of co-financing operations with European non-governmental development
organisations (NGOs)
3.3 Evaluation of the education sector of EC aid to ACP countries
4. Review ofevaluations oncountry or regionalprogramming
4.1Albania
4.2 FYROM
4.3 Moldova
4.4 Burkina Faso
4.5 Namibia
4.6 Uganda
4.7 Evaluation of regional co-operation between the PALOP countries (Pays Africains de
LangueOfficiellePortugaise) fundedthroughtheEDF
Economic co-operation : the most striking feature of EC interventions in this area
was their diversity, reflecting very different concepts and approaches. Broadly
speaking, two main categories could be distinguished: the first includes programmes
that focused on the "enabling environment for the private sector” of institutional,
238legislative and fiscal provisions, and of financial and physical infrastructure; the
second includes direct and indirect support to private sector investments or start-up
activities. The studies concluded inter alia that the concept and contents of economic
co-operation evolved and were applied differently over time and in relation to
different geographic regions; and that the choice of the various instruments was
scattered and poorly articulated. They also reaffirmed the importance of creating an
"enabling environment" for private sector development. Other studies on economic
co-operationare stillunderway.
Poverty reduction : poverty is defined as encompassing not simply a lack of income
and financial resources, but also the notion of vulnerability and such factors as lack
of access to food supplies, education and other basic needs. Sustained growth is not
sufficient in itself. While this programme is still under way, key findings of the three
evaluations completed under this heading in2001 were:
•co-financing with NGOs added another successful dimension to European
development policy, although the budget line was open to too wide a range of
actions for a consistent focus on anti-poverty activities (this evaluation has been
used for a new dialogue withNGOs);
•while European Food Aid and Food security policy had made a major qualitative
leap in terms of policy, implementation on the ground lagged, partly due to
insufficient management capacity(this evaluation was used as an input to a recent
Communicationto Counciland Parliament onthis subject);and
•although support to education in ACP countries had made good progress, there
had been no pro-active effort to link education support directly to poverty
reductionstrategies.
Country Strategy Evaluations : while care is needed in drawing overall conclusions
from a few studies covering the 1996-2000 period, they revealed a variation in
performance in the Commission’s local programmes which indicates two needs.
First, more consistent harmonisation of the strategic and programming processes (the
introduction of i-QSG and Country Strategy Papers address this); and second,
stronger and more consistent linkages and communications both within the Brussels-
based services at all levels, and between them and the Delegations, to ensure more
consistent objective setting. More specifically, the studies found that:
•the quality of the political and socio-economic analyses of country situations on
which strategy and programming documents were based had been variable. Even
where they were good, they were not always adequately taken into account in
programmingdocumentation;
•althoughtheCommissionwasoftenwell-placedto assist withthe strengthening of
the local capacities of governmental and civil society institutions, too often
opportunities were not grasped;
•where poverty alleviation was an over-riding priority, local programmes did not
always clearlyreflectthispriority;
•Delegations too often suffered from cumbersome administrative procedures and
fromexcessivedemandsontheir services;and
239•sector-based approaches worked better than project-based approaches, assuming
that the Commission exercised sufficient flexibility to disengage rapidly from
sectors in which the impact of assistance proved weak and was unlikely to
improve.
The Commission has often taken an effective lead in donor co-ordination,
particularly with EU Member States, although there is a need for more consistent
consultation procedures with the Bretton Woods Institutions in the interests of
reduced overlap, enhanced complementarity, and better co-ordinated budgetaryaid.
7.3.2. Priorities for Action Highlightedby the 2001Evaluations
As a whole, the results of the studies were encouraging. But, overall, they revealed
the need to focus more on:
•objectives , leaving open the choice to the Commission and the partner country of
the most appropriate instrument orthe most appropriate mix ofinstruments;
•flexibility of financing , it being particularly important that EU interventions are
not dependent ona budgetaryline addressing one type ofaction;and
•simplifying administrative procedures for implementing EU actions which,
during the period under review, were cumbersome and impeded effectiveness and
efficiency.
7.3.3. Evaluations in 2002and beyond
The evaluationstrategyforthe years 2002-2006143andthe work programme for 2002
were approved by the EuropeAid Co-operation Office Board during its Novembermeeting. The strategyfor 2002-2006 is given inChapter 5.
The strategy is based on a combination of various evaluation standpoints: a
geographic approach (countries and regions); a sectoral or thematic approach;
financialinstruments;and regulatoryrequirements. Allthese approaches have proved
to be necessary as a way of providing managers with reference points or practical
bases to enable themto better define the prioritysectors for development. Moreover,
the Commissioncanuse themto takeaccountof its strengths and weaknesses in each
sector in relation to other donors, as well as a means to select the best instruments or
channels for directing its aid, according to the context and the intended results.
Evidently, the Board is always entitled to request ad-hoc evaluations, in response to
needs or emergencies.
2001 saw the introduction ofa universal new results-oriented monitoring system(see
Chapter 5), with the temporary assistance of the Evaluation Unit. This will greatly
increase the flow of management information and help to improve the targeting and
qualityofevaluations.
143Published on our website:http://europa.eu.int/comm/europeaid/evaluation/index.htm
240Strengthening theQuality andUsefulnessofEvaluations
•Dissemination andfeedback
– Major evaluation findings have beenregularlyreportedto the BoardofEuropeAid
Co-operationOffice.
– The final stage of the majority of evaluations is a seminar at which key findings
and recommendations are presented to interested services, management, and other
specialists. In some cases, evaluation reports are discussed in the appropriate fora
withrepresentativesofEUMemberStates.
– The Inter-service Quality Support Group has been tasked with progressively
harmonising and improving the quality of programming work, including full
consideration of relevant evaluation findings. The Head of the Evaluation Unit
takes part in the work of the iQSG and can check how far the lessons drawn from
evaluation have been taken on board.
– The reinforcement of the 'fiche contradictoire': this fact sheet sets out evaluation
recommendations and findings against the responses of the services concerned (in
a second column), with the aim of informing the Commissioners of agreed
changes or of why recommendations for change were not accepted. In its meeting
ofNovember 2001, the Board agreedto add athird column to indicate how far the
accepted recommendations ofthe evaluations have been followed up.
– The full text of all evaluation reports commissioned by the Evaluation is
published on the evaluation section of EuropAid Co-operation Office’s web
site144.In addition, the service maintains a database of Commission-funded
evaluation reports of individual projects. The evaluations themselves are all done
byexternal, specialisedconsultants.
•Exchange of evaluation experience and information with Member States and
others
During 2001, two meetings took place with the Evaluation Services of the Member
States at whichplanned, ongoing and recently completed evaluations were discussed.
Further steps were also taken on the joint evaluation work on the "3Cs" – Co-
ordination, Complementarity and Coherence. Exchanges with other donors were
maintained particularly via the OECD/DAC Working PartyonEvaluation.
7.4. Audits
EDF: efforts focused on audits of budgetaryaid. The three audits started in Ethiopia,
Zambia and Niger, plus finalisation and follow-up of eight audits carried out in 2000
(Cameroon, Guinea, Madagascar, Cape Verde, Malawi and Burkina Faso) absorbed
all available capacity. Note also support for a relatively small number of
non-budgetary audits, such as the audit on airport construction in Madagascar and
those for the EBAS, DIAGNOS, CDE and ATF projects. In addition to its
operational work, the Audit unit's expertise was sought the IAS Board for an
144http://europa.eu.int/comm/europeaid/evaluation/index.htm
241administrative survey on the management of counterpart funds and for a strategy to
promotecollaborationbetweeninternationaldonors.
The audits of MEDA-financed programmes and projects were carried out for the
third consecutive year by auditors of the MEDA team. Acting on requests of the
operational directorate or, with its agreement, in response to the Delegations, the
audit team carried out 24 audits. Additional work was needed on 12 of the audits
done in 2000. The winding-up of technical assistance offices at the end of 2001 also
meant the end ofthe MEDAaudit team.
No audit was done for programmes or projects in Latin America orAsia.O ft h e
four audits carried out in Central and Eastern Europe , those most important were
those concerning the deliveryoffood aid to Russia and budgetaryaid for FYROM.
Of the "non-geographical" audits, the most noteworthy were those of CLONG, the
ECIP andthe follow-up oftheUNRWAaudit.
Since March 2001 the unit has been preparing a framework-contract for audits to
facilitatethe selectionofauditors. The contract should be inuse insummer 2002.
7.5. Innovation
Withinthe frameworkofinitiativestakenbyEuropeAid Co-operation Office towards
the improvement of quality in the management of development co-operation, the
Innovation Unit was involved in the following main areas :
– Support tothe establishment ofthematic networks
During the second half of the year six thematic networks were established covering
the following subjects:
•Budgetaryaid
•Healthsector
•Educationsector
•Capacitybuilding, goodgovernance and rule oflaw
•Trade
•Private sector development
This initiative responds to both the objective of ensuring good co-ordination among
different geographical directorates and the objective of accompanying the on-going
devolutionprocess.
More specifically the objectives are :
•Develop coherent approaches among different geographical regions, and within
the same region, while maintaining the necessary flexibility to allow for
adaptationsto localconditionsandspecificities;
242•Support geographical directorates with the aim of improving quality and
efficiencyin implementation, aswellasthevisibilityofco-operation;
•Contributeto thetraining ofpersonnelin Headquarters and Delegations.
T h er o l eo fe a c ht h e m a t i cn e t w o r ki st ob eaf o r u mf o rd i s c u s s i o n sa n de x c h a n g eo f
informationwiththe aim of improving qualityof implementation through the sharing
of best practices. The role of thematic networks is also to contribute to the
preparation ofoperational guidelines which is an on-going activity.
– PreparationofGuidelines
Work on the guidelines on programming and implementation of budgetary aid
operations in third countries progressed smoothly. A wide consultation process was
launched building upon expertise within EuropeAid and in other Directorates
General. Asignificant number ofdelegations were also involved.
Prepraratorywork for the other guidelines (i.e. SWAPS in education; Private Sector
Development) was also launched.
– PreparationofTraining courses onPCM, SWAPS and BudgetaryAid
Two tenders for the recruitment of external consultants for the implementation of
training courses and provisionofhelp desk services onPCM, SWAPS and Budgetary
aid as well as economic and financial analysis were launched in November.
Consultants are expected to be recruited by the end of the first quarter of the year
2002.
Help desk services and training activities are meant to complement the work aimed at
preparing the operationalguidelines.
– Reflections on rationalisation and revision of implementation modalities for
budget lines
EuropeAid launched an analysis aimed at rationalising and reviewing the
implementation modalities for thematic programmes financed under specific budget
lines. EuropeAid also launched a comprehensive analysis focusing on the devolution
of thematic programmes financed under specific budget lines. Both the former and
thelatterareongoing.
– Screening ofProjects
Screening of projects were undertaken during the year focusing primarily on
educationprojects and private sector development projects.
– New Themes
Access to new technologies, information society, renewable energies and its possible
integration within development co-operation programmes was given attention.
Emphasis inthis area is expected to increase during the year 2002.
2437.6. Relations with otherInternationalDonors
A new specialised service was created to this purpose in EuropeAid Co-operation
Office. These are the results of its first year of life:
A Co-financing and Trust Funds Framework Agreement was signed on November 8
with the World Bank. This Framework Agreement sets out the rules applicable in
case of EC co-financing of projects undertaken by the World Bank. It contains
guidelines for the conduct of verification missions, as well as contract templates to
ease the negotiations ofeach individualcontract.
As a follow-up to the Commission communication “Building an effective partnership
with the United Nations in the fields of development and humanitarian assistance”,
severalmeasures have beentaken:
•anAgreementontheImplementingModalitiesoftheVerificationClause was also
reached with the United Nations. This question had been a stumbling block
between the Commission and the UN for years. This new agreement opens the
way for a more comprehensive revision of the currently applicable framework
agreement between bothorganisations ;
•a report was established on EuropeAid Co-operation Office’s experience of
working with different UN organisms, to be followed by a proposal of partners
with which to build a stronger partnership ;
•a table of EC projects with UN for 1999-2000 was compiled from the operational
units, whichwillbe regularlyupdated ;
•a number of high-level contacts to initiate the identification and programming to
reinforce concrete co-operation on programmes and projects co-financing, was
taken with some of those organisms, including UNDP, UNHCR, ILO and
UNESCO.
In the field of strengthening co-ordination and complementarity with bilateral
donors, the Office has developed high-level contacts with the majority of them. In
particular, a memorandum of co-operation for co-financing projects in Chad was
signed inDecember withthe Frenchand Germanexecuting agencies.
7.7. Transparency and visibility
A considerable effort has been undertaken in 2001 in order to produce the first
Annual Report gathering information on the implementation of the EC external
assistance in all the regions managed by the newly created EuropeAid Co-operation
Office. It presented a state of the play at 01/01/2001, the first day of the European
Commission’s new structure forthe management ofthe EC externalassistance.
On the other hand, the web continues being the main instrument for information and
transparency. Some improvements have been made and 2002 will see a new more
user-friendly approach to show the activities on the spot. The co-operation sections
of the Delegations webs will be linked so as to show, wherever possible, the
individualprojectsonthescreen.
244The most visited section of EuropeAid site is, also this year, the one devoted to
tender opportunities where interested partners can find all the information on all the
external activities to be developed by the European Commission. The evaluation site
has also improved in size and number of visitors.
http://europa.eu.int/comm/europeaid/tender/survey/index_en.htm.]
The following table shows the number ofhits for the different Externalrelation sites
in the European Commission server. It should be borne in mind that the number of
hits is always larger than the number of times a computer user accesses a particular
web site since a hit is recorded for each element on the web page (including
photographsand links).
THE EUROPEAN COMMISSION EXTERNAL RELATION WEBSITES
SERVICES ADDRESSAVERAGE
HITSPER
MONTH
IN 2000AVERAGE
HITSPER
MONTH
IN 2001
DGExternalRelations
DG DevelopmentEuropeAidCo-operationOfficeDG TradeDG EnlargementECHOTheEUintheWorldEuropa.eu.int/comm/external.relations
Europa.eu.int/comm/developmentEuropa.eu.int/comm/europeaid
Europa.eu.int/comm/trade
Europa.eu.int/comm/enlargementEuropa.eu.int/comm/echoEuropa.eu.int/comm/world1,000,000
600,000600,000
1,000,000
1,000,000
400,000200,0002,125,000
200,000
4,200,000
1,800,000
400,000250,000200,000
7.8. EC Assistance not covered by the Report
This document covers all the external assistance activities managed by the
EuropeAid Co-operation Office. Humanitarian and Pre-Accession Aids are outside
the scope of this report. Nevertheless, a concise description of ECHO’s activities is
included in each regional section so as to give the reader a comprehensive view of
theglobalECcontribution.
For full details, annual reports are available on Humanitarian Aid as well as on the
Assistance to Candidate Countries. The following short summary indicates the
significance ofEC activities in these two areas.
Humanitarianaid
ECHO’s response to humanitarian crises in 2001 amounts to a total of €543.7
million. Humanitarian projects have been funded in more than 60 countries. 1031
contracts have been signed (including contracts implementing decisions made in
2000). African, Caribbean and Pacific countries were the biggest recipient of
humanitarian aid with a total amount of €173.3 million (35%). Assistance to the
Western Balkans decreased compared to 2000, due to the stabilisation of the region,
whereas aid for Asia increased slightly.
ECHO’s main partner group remains European NGOs (62.5 % of ECHO’s funding
was implemented through them). With the UN High Commission for Refugees
(8.6%) and the World Food Programme (7.25%) as ECHO’s main partners, funding
for the UN increased considerably in 2001 and reached 26.5% (2000:19.2%). Other
245internationalorganisations, including the International Committee ofthe Red Cross ,
received 7.9%.
Assistance to Candidate Countries
The European Community made available over €3 billion of assistance in 2001 to
countries that are candidates for membership of the European Union. Nearly 95% of
this pre-accession assistance was directed to the ten candidate countries of Central
and EasternEurope145throughthree separate programmes.
The Phare Programme, managed by Directorate General for Enlargement, accounted
for about €1.6 billion. It concentrates on priorities for accession, as defined by the
Council inthe 'AccessionPartnerships'and progress in meeting themidentified in the
Commission's annual Regular Reports. Around 30% of Phare resources are allocated
to Institution Building and 70% to investments, equally divided between investment
to strengthen the regulatory infrastructure needed to ensure compliance with the
acquisand investment in Economic and Social Cohesion. The latter helps candidate
countries bridge to structures and procedures needed to use Structural Funds
efficientlyand effectivelyuponaccession.146
Ispa, managed by Directorate General Regional Policy, accounted for about €1
billion. It focuses on major investments in the environment and transport sectors.147
About €500 million were made available for Sapard, which focuses on rural
development and agriculture. DG Agriculture manages this programme.148
€194 million, €11.5 million and €7.5 million were allocated to Turkey, Cyprus and
Malta respectively, in 2001. Assistance to Cyprus and Malta was provided on the
basis of a pre-accession regulation agreed in March 2000, whereas assistance to
Turkey was implemented under the MEDA and European Strategy regulations. A
new financial regulation for Turkey, adopted in December 2001, will be used from
2002. Assistance to these three countries is managed by DG Enlargement, though
they remain eligible for support from MEDA regional programmes in the context of
the Barcelona process, managed byEuropeAid.
For each pre-accession programme, the managing DG is responsible within the
Commission for the whole project cycle from programming through implementation
to evaluation. However implementation of these programmes is highly decentralised,
with the candidate countries themselves directly responsible for project management
(subject to checking oftendering and contracting byCommissionservices).
Macro FinancialAssistance for Third Countries
The Commission implements macro-financial assistance (MFA) in association with
support programmes from the IMF and the World Bank, and after consulting the
145Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Rumania, Slovakia and
Slovenia.
146PleasefindthePhareAnnualReportonthefollowingwebpage:
http://www.europa.eu.int/comm/enlargement/pas/phare/publist.htm
147Please findthe Ispa Annual Report on the followingwebpage:http://www.inforegio. cec.eu.int/wbpro/ispa/ispa_en.htm
148PleasefindtheSapard Annual Report on thefollowingwebpage:
http://www.europa.eu.int/comm/enlargement/pas/sapard.htm
246Economic and Financial Committee and securing a Council Decision. MFA
incorporates a set of principles which underline its exceptional character (ad-hoc
Council Decisions), its complementarityto financing fromthe international financial
institutions and its macroeconomic conditionality. It is an instrument designed to
help the beneficiary countries meeting serious, but generally short-term
macroeconomic imbalances (serious balance of payments and fiscal difficulties).
Inclose co-ordination with IMF and World Bank programmes, MFA has promoted
policies that are tailored to specific country needs with the overall objective of
stabilising the external and internal financial situation and establishing market-
oriented economies.
In 2001,149€380 million ofMFA were disbursed, comprising two €7 million grants
and a €60 million loan to Tajikistan; a €6 million grant to Georgia; a grant of €15
millionto Kosovo; a grant of €15 million to Bosnia and Herzegovina; a loan of €12
million and a grant of €10 million to FYROM150;a €225 million loan and a €35
milliongrant to the FederalRepublic ofYugoslavia.
The Commission reports on a yearly basis to the European Parliament and the
Councilaboutthe implementationofmacro-financialassistancetothirdcountries.151
149A €10million grantanda €10 million loan to Bosnia and Herzegovina, a €10 million loan to FYROM
and a €12.95 million grant to Montenegro were disbursed in early 2001. However, the disbursement
decisions weremadein 2000andthepayments weremadewith appropriationsfromthe2000budget.
150The actual payment of both the loan tranche and the grant instalment took place in January 2002.However, the decision was made in December 2001 and, with regard to the grant, the payment was
madewith appropriationsofthe2001budget.
151Report from the Commission to the European Parliament and to the Council on the Implementation ofMacro-FinancialAssistancetoThirdCountriesin 2001(COM(2002)352final of11.07.2002).