COMMUNICATION FROM THE COMMISSION TO THE COUNCIL

Financial information on the European Development Funds

Foreword

In accordance with Article 7(3) of the Internal Agreement[1] and Articles 57(3) and (4) of the 10th EDF Financial Regulation[2], the Commission presents in this document estimates of commitments, payments and contributions for the period 2011 to 2012, taking into account the forecasts of the European Investment Bank (EIB) concerning the Investment Facility.

This document sets out the financial implementation of the EDFs (8th to 10th) for 2010 and the forecasts of implementation for 2011 to 2013.

The Member States contribute funds directly to the European Investment Bank for the instruments which it manages under the 9th and 10th EDFs (the Investment Facility and interest-rate subsidies). Contributions for other instruments, including contributions for the old instruments managed by the EIB (risk capital and interest-rate subsidies), go to the Commission.

Introduction

The Commission and the EIB have updated their commitment and payment forecasts for 2011 and 2012 for each of the ACP countries[3] and the OCTs[4]. The payment forecasts in particular have been compiled with great care with the aim of helping the Member States to assess as accurately as possible the amounts they need to earmark in their national budgets while ensuring that sufficient financial resources are available for the EDF to avoid liquidity problems.

In accordance with Article 7 of the Internal Agreement on the 10th EDF[5] and Article 57(5) of the Financial Regulation[6], estimates will be revised in the October 2011 communication.

The graph below shows the general trend in commitments and payments, including projections for 2011 - 2013 (Commission and EIB). It clearly shows the structural upward trend in commitments and disbursements since 1997, due to a speed up in the implementation of aid. As anticipated since 2008, the gap between the commitments and the payments has reduced in 2009 and 2010, thus reflecting a trend where the payment levels get closer to commitment levels.

EC + EIB gross commitments and payments: trend 1997-2013[7]

[pic]

1. IMPLEMENTATION OF THE EUROPEAN DEVELOPMENT FUNDS AT 31 DECEMBER 2010 (COMMITMENTS, PAYMENTS AND FINANCIAL SITUATION)

The annexes 1, 2 and 3 show respectively the actual commitments, payments and financial situation recorded in 2010 compared with the forecasts made in October 2010[8], and the projections made for 2011 and 2012.

At year end 2010, 50% of the 10th EDF had been committed, on track to meet our target to commit the 10th EDF by end 2013.

The payments for 2010 represent the highest levels so far for the EDF and confirm a general positive trend for payments.

2. Financial forecasts for 2011 – 2013[9]

THE FOLLOWING TABLE PROVIDES AN UPDATE BASED ON OUR LATEST FORECASTS.

[pic]

3. FINANCIAL IMPLEMENTATION FORECASTS FOR 2011 AND 2012

The new forecasts are set out in Annexes 1 to 3.

The Member States contributions to the EDF for 2011 were decided by the Council in October 2010[10], at EUR 3 690 million for the Commission and EUR 210 million for the EIB. The new 2011 forecasts still confirm the EIB's treasury needs of EUR 210 million but indicate that Commission's cash needs are lower than estimated in October 2010, amounting to EUR 3 100 million.

The ceiling for the Member States contributions in 2012 is set at EUR 3 800 million for the Commission and EUR 280 million for the EIB[11].

It should be stressed that these figures are a preliminary forecast and must be treated with caution. The Commission and the EIB will make more reliable forecasts after the summer. They will be presented in the October communication.

[pic]

[pic]

[pic]

Annex 4. Contributions to the EDF for 2011 by Member State (EUR)

[pic]

[1] Internal Agreement between the Representatives of the Governments of the Member States, meeting within the Council, on the financing of Community aid under the multiannual financial framework for the period 2008 to 2013 in accordance with the ACP-EC Partnership Agreement and on the allocation of financial assistance for the Overseas Countries and Territories to which Part Four of the EC Treaty applies, OJ L 247, 9.9.2006, p. 32.

[2] Council Regulation (EC) No 215/2008 of 18 February 2008 on the Financial Regulation applicable to the 10th European Development Fund.

[3] African, Caribbean and Pacific States.

[4] Overseas countries and territories.

[5] OJ L 247, 9.9.2006, p. 32.

[6] Council Regulation (EC) No 215/2008 of 18 February 2008 on the Financial Regulation applicable to the 10th European Development Fund

[7] For 2011-2013, forecasted amounts

[8] COM(2010) 512 final of 11.10.2010.

[9] Both for the Commission and the EIB, as the financial framework for the period after 2013 has not been agreed and is expected to have a material impact on the implementation figures, we prefer not to present any forecasts for commitments, payments and contributions for the years 2014 and 2015.

[10] Council Decision of 05 November 2010, document 15831/10

[11] Council Decision of 29 November 2010 on the ceiling for the annual amount of the contributions to be paid by the Member States to finance the European Development Fund in 2012 – Council document 16971/10.