European Commission: 
The Tacis Programme 
Annual Report 1995 
Brussels 22.07.1996 Com (96) 345 final 
What is Tacis? 
The Tacis Programme is a European Community initiative 
for the New Independent States and Mongolia, which 
fosters the development of harmonious and prosperous 
economic and political links between the European 
Community and these partner countries. Its aim is to 
support the partner countries' initiatives to develop 
societies based on political freedoms and economic 
prosperity. 
Tacis does this by providing grant finance for know-how 
to support the process of transformation to market 
economies and democratic societies. In its first five years 
of operation, 1991-95, Tacis has made available more 
than ECU 2,268 million to launch more than 2,200 
projects. 
Tacis works closely with the partner countries to 
determine how funds should be spent. This ensures that 
Tacis funding is relevant to each country's own reform 
policies and priorities. As part of a broader international 
effort, Tacis also works closely with other donors and 
international organisations. 
Tacis provides know-how from a wide range of public 
and private organisations, which allows western 
experience to be combined with local knowledge and 
skills. This know-how is delivered by providing policy 
advice, expert teams, studies and training, by developing 
and reforming legal and regulatory frameworks, 
institutions and organisations, and by setting up 
partnerships, networks, twinnings and pilot projects. 
Tacis is also a catalyst, unlocking funds from other 
lenders by providing pre-investment and feasibility 
studies. Tacis promotes understanding and appreciation of 
democracy and a market-oriented social and economic 
system by cultivating links and lasting relationships 
between organisations in the partner countries and their 
counterparts in the European Community. 
The main priorities for Tacis funding are common to all 
partner countries, although each is at different stages of 
transformation. Currently, the key areas include: 
restructuring of state enterprises and private sector 
development, building an effective food production, 
processing and distribution system, developing energy, 
transport, and telecommunications infrastructures, 
nuclear safety, environment, public administration reform, 
social services and education. 
Contents 
Commissioner's statement 2 
Tacis in 1995 - consolidating reform 3 
Tacis and European Union policy 4 
Tacis financial overview 5 
Operational management of the Tacis Programme 8 
Tacis and the European Community institutions 11 
Bilateral and international cooperation 12 
Armenia 13 
Azerbaijan 15 
Belarus 17 
Georgia 19 
Kazakhstan 21 
Kyrgyzstan 23 
Moldova 25 
Mongolia 27 
Russian Federation 28 
Tajikistan 37 
Turkmenistan 38 
Ukraine 39 
Uzbekistan 42 
Multi-country programmes 44 
Future outlook 48 
Special feature 
Tacis in the NIS energy sector 33 
Annexes 
Tacis funds allocated by sector 49 
Tacis financial performance 52 
List of major contracts signed in 1995 55 
Commissioner's statement 
The Tacis Programme reached an important turning point 
in 1995, as it prepared for its next major programming 
cycle. 
Five years since its inception, it has reached a level of 
maturity in which it can point to significant advances made 
in enhancing the reform process in the New Independent 
States. It can claim this with the assurance of having 
instituted extensive and thorough systems for the 
monitoring and evaluation of individual projects and 
framework programmes. Its challenge, therefore, is to 
make the best possible use of the weight of this 
experience, by shaping it to formulate plans for the new 
programming cycle from 1996 to 1999. 
Tacis in context 
As Tacis embarks upon this task, the relationship between 
the European Community, its Member States and the 
New Independent States is entering a new stage. Long 
and involved negotiations have brought us to a point at 
which we have signed Partnership and Cooperation 
Agreements with the majority of our partner countries. 
Even greater challenges lie ahead in the actual 
implementation of these broad-ranging Agreements, 
which encompass so many areas of political, economic, 
social and cultural cooperation. 
In this, Tacis remains an important instrument for 
facilitating the implementation of the broad objectives of 
the Partnership and Cooperation Agreements. Consolidation 
The Tacis Programme continues to provide grant finance 
for know-how in clearly defined priority sectors, in 
accordance with the needs and wishes of its partner 
countries. It stands by the principles which underpin all its 
activities, such as the respect for democracy and human 
rights and the preservation of the environment. It 
continues to consolidate its activities with those of other 
international donors and lenders. It maintains its efforts to 
enhance its accessibility, with a readiness to provide 
timely and substantial information about the Programme. 
Innovation 
At the same time, Tacis has shown itself to be adaptable, 
demonstrating the broadening scope of the Programme, 
and exemplifying the spirit in which it is prepared to 
develop practical solutions in a relationship with its partner 
countries which is constantly evolving. 
I consider multi-annual programming essential, in order to 
enhance the impact of the Programme, allowing longer-
term planning and, for individual projects, quicker 
inception and greater concentration. 
Meanwhile the commitment towards the funding of 
investment support for EC-NIS small and medium-sized 
enterprise joint ventures and for small-scale infrastructure 
projects in border areas, as proposed in the new Tacis 
Regulation, represents another important new departure 
for the Programme. 
Priorities for the Programme 
The European Commission is addressing this task by 
reaffirming the commitment to principles and procedures 
established under Tacis, while adapting itself to'move with 
the times and maintain the impact and performance of the 
Programme in its second five years of operation. 
For this reason I attach particular importance to both the 
consolidation and the innovation which took place within 
the Tacis Programme in 1995. I commend this Annual Report, which charts the most 
important developments in the Tacis Programme in 1995, 
another year of notable achievement. In particular, I would 
again like to pay tribute to the performance and dedication 
of the individuals who manage the Programme. 
Hans van den Broek 
Member of the European Commission 
Tacis in 1995 - consolidating reform 
Tacis is the largest grant finance programme providing 
know-how to the New Independent States. Five years 
after its inception in 1991, Tacis has committed over ECU 
2,268 million and launched more than 2,200 projects. The 
Programme is now contracting as many projects each 
year as it did in its first three years of operation combined. 
Tacis is now well established, and plays an acknowledged 
role in the processes of fundamental economic and social 
change which are currently unfolding in the New 
Independent States. 
1995 saw the significant strengthening of the political 
framework for relations between the European 
Community and its Member States with the New 
Independent States, through the conclusion of a number 
of Partnership and Cooperation Agreements, PCAs. The 
Agreements have a wide scope in covering all political, 
commercial, economic and cultural cooperation between 
the European Community, its Member States and the 
New Independent States, NIS. They also draw together all 
the elements of European Community support towards 
the partner countries. One of the primary aims of Tacis is 
to contribute to the realisation of the objectives of these 
PCAs. Agreements have been signed by six New 
Independent States and initialled by a further three. 
Once ratified and in force, the Agreements will also offer 
greater security to companies and investors from the 
European Community, to encourage the direct investment 
which is needed by the economies of the New 
Independent States. The year 1995 also saw enhanced coordination between 
Tacis activities and those of Member States and other 
donor organisations working in the NIS. Tacis worked with 
other organisations primarily on an individual project basis. 
The new monitoring and evaluation system for Tacis 
projects became fully operational in 1995 and has been 
highlighting areas where improvements can be made. 
Meanwhile Tacis can now concentrate on responding 
more rapidly to changing needs, and on implementing 
projects quickly once they have been identified and 
agreed. An important part of this process is the 
reinforcement of multi-annual planning which allows a 
long-term strategic approach to run in parallel with the fast 
implementation of projects. 
The proposed new Regulation allows Tacis to provide 
funding for investment support to EC-NIS small and 
medium-sized enterprise joint ventures. Assistance may 
be provided through a combination of INTERREG, Phare 
and Tacis to support measures aimed at promoting inter­
state, inter-regional and cross-border cooperation, 
including small infrastructure projects in cross-border 
areas. The environment (institutional strengthening, 
legislation, training) has been identified as a priority area. 
However, the transfer of know-how remains the hard core 
of Tacis activity, and this is largely done through the 
individual country programmes which comprise some 60 
per cent of the annual Tacis budget. 
These issues are explained in more detail in the following 
chapters. 
Tacis and European Union policy 
The Tacis Programme, developed by the European 
Community in 1991, was one of the first instruments to 
support the New Independent States in the reconstruction 
of their economies and societies. 
The Tacis Programme has now been providing grant 
finance for the provision of know-how to its partner 
countries in the NIS for five years. In that time, 
developments have made it clear that overall relations 
between the European Community, its Member States, 
and each partner country should be put on a different, 
broader footing. For this reason, a new set of contractual 
arrangements with the individual partner countries, known 
as Partnership and Cooperation Agreements, PCAs, is 
now replacing the 1989 Agreement on Trade, Commercial 
and Economic Cooperation which was drawn up between 
the Communities and the entire former Soviet Union. 
Although these Agreements are diverse, reflecting the 
differences between the partner countries themselves, 
each establishes a close form of contractual relations: a 
political and economic partnership, covering all aspects of 
relations, from trade and investment to cooperation in the 
areas of home affairs and justice. 
The concept of partnership embodies the shared 
principles and objectives which are the basis for the 
relationship: respect for the rule of law and human rights, 
the development of political freedoms including the 
establishment of a multiparty system with free and 
democratic elections, and the establishment of a 
functioning market economy. Furthermore, it aims to 
support the integration of the NIS into the world economy, 
the promotion of peace and security, and the 
development of international relations, globally and 
regionally, in accordance with the principles of the United 
Nations, UN, and the Organisation for Security and 
Cooperation in Europe, OSCE. 
The PCAs use Tacis as the most important tool to 
facilitate cooperation under each Agreement. It provides 
the means to support partner countries' efforts to 
consolidate democracy and to complete the transition to 
the market economy. Towards broader political relations 
By the end of 1995, the European Community and its 
Member States had negotiated Partnership and 
Cooperation Agreements with the majority of the New 
Independent States. Having concluded PCAs with Russia, 
Ukraine and Moldova in 1994, during 1995 the EU 
negotiated and signed PCAs with Belarus, Kazakhstan 
and Kyrgyzstan and initialled them with Armenia, 
Azerbaijan and Georgia. Exploratory PCA talks also began 
with Uzbekistan. 
While the PCAs await full ratification, a number of Interim 
Agreements covering the trade aspects of the Partnership 
and Cooperation Agreements have been negotiated and 
some of these have entered into force. This will allow the 
parties to benefit from the trade and commercial 
provisions of the PCAs at the earliest possible moment. 
Contractual relations with Russia moved forward, with the 
signature of the Interim Agreement in July 1995. This took 
place after a difficult period in EU-Russian relations which 
was prompted by the events in Chechnya. Out of serious 
concern for the situation there, the Commission initially 
froze procedures for the entering into force of the Interim 
Agreement, until conditions agreed by the EU were met 
by the Russian government. 
The Interim Agreement with Ukraine was signed in June 
1995 and entered into force in February 1996. Throughout 
the year, the European Union developed a close and 
structured dialogue with Ukraine. Meetings at a ministerial 
level have become a regular means of facilitating this 
dialogue. Ukraine also joined the Council of Europe in 
November 1995. 
In March 1995 Belarus signed a Partnership and 
Cooperation Agreement with the European Community 
and its Member States and initialled an Interim Agreement. 
However, given the difficulties involving the Belarussian 
parliamentary processes, and the fact that Parliament was 
only constituted late in the year, in 1995 Belarus did not 
meet the requisite political conditions for the signature of 
the Interim Agreement. 
Moldova signed an Interim Agreement with the European 
Community in October 1995, while the Partnership and 
Cooperation Agreement is pending ratification. Moldova 
was the first of the New Independent States to join the 
Council of Europe, in July 1995. 
A new integrated regional approach From strategy to implementation 
In 1995 the Commission considered that the time had 
come to bring together the experience, the instruments, 
and the possibilities offered by the contractual 
arrangements of the Partnership and Cooperation 
Agreements, into a set of comprehensive strategy 
documents covering the full range of relations with each 
partner and region. 
It therefore prepared three individual Communications on 
relations with Russia, the states of the Caucasus, and 
those of Central Asia. These proposed to the Council the 
basis for an integrated policy for each area, as had been 
done for Ukraine in 1994. The debate over the Commission Communications on the 
Transcaucasus and Central Asia continues. However, in 
November 1995 the Council of Ministers adopted a set of 
strategic principles for the European Union's relations with 
Russia. These covered economic transformation, support 
to democratization, security, foreign affairs, and issues 
related to home affairs and justice. The strategy elements 
were confirmed by the European Council at the Madrid 
summit in December. At the same time the Ministers also 
agreed that the Union should develop an Action Plan for 
Russia, identifying short- and medium-term actions in all 
the different areas of the relationship, and drawing on the 
experience and potential of Tacis for many of its 
components. 
Tacis financial overview 
In 1995, the Tacis Programme committed a total of ECU 
511.19 million, including ECU 10 million for the Tacis 
Democracy Programme. The total Tacis commitments 
over the five years of the Programme's life now stand at 
ECU 2,268.37 million. 
During 1995, Tacis launched projects and contracted 
funds to a value of ECU 527 million. This compares to a 
total of ECU 557.2 million contracted from 1991 -1993. 
Tacis funds committed from 1991 to 1995 
ECU 2,268.37 million 
511.193 
472.09 
396.50 418.91 
1991 1992 «IP 
1993 The Tacis Programme paid out ECU 374.5 million, an 
increase of 24.7 per cent from the previous year and 76 
per cent more than the amount that was paid out during 
the first three years of the Programme combined. 
This means that of the total Tacis commitments, 70.5 per 
cent has now been contracted, and of the amount 
contracted 55.5 per cent has been paid. 
The time lag between commitment and payment is normal 
for a programme of this type. After five years of operation, 
Tacis has disbursed 82.9 per cent of its initial 1991 
budget. 
1994 1995 1 For 1993, figures include ECU 22 million for humanitarian aid to 
Armenia, Azerbaijan and Georgia (managed by Tacis) 
2 For 1994, figures include ECU 10 million for the Tacis Democracy 
Programme (managed by Tacis under a separate budget line) 
3 For 1995, figures include ECU 10 million for the Tacis Democracy 
Programme (managed by Tacis under a separate budget line). 
1991-1995 funds committed by country (in ECU million) 
Azerbaijan 
Baltic States 1991 
1992 
1993 
1994 
1995 
Belarus 
Georgia 
i 
Kyrgyzstan 
Moldova 
Mongolia 
Russian 
Federation 
Tajikistan 1995 
1991 
1992 
1993 
1994 
1995 
Turkmenistan 1991 
1992 
1993 
1994 
1995 
Ukraine 
Multicountry 
programmes 1991 
1992 
1993 
1994 
1995 
1994 budget also covered activities in 1995 
1991-1995 funds allocated by sector (in ECU million) 
Nuclear safety 
and environment 
Restructuring 
state enterprises 
and private sector 
development 
Public administration 
retorm, social 
services and 
education 
Agriculture 
Energy 
Transport 
Policy advice 
Telecommunications 
Other sectors 
Operational management of the Tacis 
Programme 
In 1995 the structure of the operational management of 
Tacis was adapted to respond to the new geographical 
approach within the Commission in the area of external 
relations. Tacis also reviewed its programming and 
planning procedures and restructured its monitoring and 
evaluation teams, while strengthening its presence in the 
partner countries and continuing a broad-based 
communications programme to inform all those working 
with and interested in the Programme. 
Reorganisation of the NIS/Tacis Directorate 
The NIS/Tacis Directorate, which manages the Tacis 
Programme within Directorate General IA (Europe and the 
New Independent States, Common Foreign and Security 
Policy and External Missions) was reorganised in 1995. 
The reorganisation reflects the role of the Tacis 
Programme within the wider context of relations between 
the European Community, its Member States and the 
New Independent States. It acknowledges the importance 
of Tacis' experience on the ground in the development 
and implementation of the Union's policy towards the NIS. 
The new organisational structure integrates the 
management of the Tacis Programme with all other areas 
of EC-NIS relations, including political, economic and 
trade areas. This is designed to enhance policy 
consistency and overall efficiency. 
As a consequence, the original sectoral split of 
responsibilities has been replaced along geographical 
lines. The new unit C2 is responsible for Russia, unit C3 
covers relations with Ukraine, Belarus and Moldova, and 
C4 with the countries of central Asia (Kazakhstan, 
Kyrgyzstan, Tajikistan, Turkmenistan, Uzbekistan and 
Mongolia) and the Transcaucasus (Armenia, Azerbaijan 
and Georgia). Within their geographical competence, each 
of these units is responsible for 
• preparation, negotiation and implementation of 
Partnership and Cooperation Agreements and 
Interim Agreements 
. management of political, security, economic and 
trade relations 
. programming and implementation of the Tacis 
Programme. 
This new structure allows for the development of an 
integrated approach for each country. The creation of one 
contact point for each partner country facilitates direct 
relations with that country and with the desk officers of 
other donor organisations. Each geographical unit is now responsible for all Tacis 
activities relevant to a given country, with the exception of 
nuclear safety which covers Phare and Tacis countries. 
Nuclear safety programmes are managed by unit C5, 
which is also responsible for related horizontal activities 
and donor coordination. 
A new unit C6 defines the policy for monitoring and 
evaluation, and determines Tacis sectoral strategies. It 
also manages the majority of Tacis framework 
programmes, including those for policy advice, 
democracy and cofinancing with non-governmental 
organisations. Unit C7 is responsible for Tacis financial 
and administrative management, including budget, 
contracts, accounting and payments. It supports the other 
units in the preparation of tenders and contracts, and is 
also in charge of liaison with the Court of Auditors and the 
Tacis Committee. 
Meanwhile unit C1 is dedicated to the development and 
pursuit of a coherent policy approach towards the New 
Independent States. The unit also manages the overall 
Tacis programming, and takes responsibility for the 
coordination both of multi-country programmes and of 
relations with Member States and other donor 
organisations, and for the management of those 
framework programmes which work closely with other 
international donors. 
Multi-annual planning 
In order to improve Tacis performance and to reduce time 
spent planning the actions in different partner countries, 
Tacis started its first multi-annual programming cycle in 
1993. This meant that the Indicative Programmes outlining 
the basic objectives and strategy for Tacis in each 
individual country were established for a three-year period 
instead of a one-year period. This allowed the earlier 
framing of annual Action Programmes, which identify the 
individual projects and activities to be undertaken, and the 
speedier selection and implementation of Tacis projects. 
In 1995, Tacis carried out an internal review of its 
programming procedures. The review showed that the 
multi-annual planning process had significantly 
accelerated the implementation of Tacis projects, which 
has been reflected in the increasing number of contracts 
and payments. Multi-annual planning also gave the 
Programme a more strategic focus, as well as motivating 
the partner countries to assess their long-term needs. 
However, the review also concluded that there was a 
need to enhance the strategic orientation of the 
Programme by further promoting the multi-annual 
approach. This is to be done by concentrating Tacis 
activities on those areas where the Programme can most 
effectively assist reform, and increasing the size of projects 
where possible. In this way, Tacis will serve as a more 
integral and effective component in the Commission's 
overall relations with partner countries. 
To enhance the efficiency of the Tacis Programme, 
Indicative Programmes will become four-year instruments 
(rather than three as before) and the majority of Action 
Programmes will become biannual instruments (rather 
than annual as before). For Russia and Ukraine annual 
Action Programmes will be retained. This multi-annual 
approach is reflected in the Commission proposal for the 
new Tacis Regulation. 
The new Indicative Programmes will be more substantial 
documents than their predecessors, giving a coherent 
view of Tacis' intended role in a restricted number of 
priority sectors over a number of years. They will also bind 
the partner countries to committing to political and 
economic reform on a long-term basis, as a condition for 
the provision of Tacis support. 
In addition, and as proposed under the new Tacis 
Regulation, four-year financial estimates will be included in 
each Indicative Programme, even though the overall Tacis 
budget remains subject to the standard annual budget 
cycle of the European Commission. 
In order to implement this new programming 
methodology, the Commission developed operational 
guidelines setting out procedures by which programming 
will take place. The guidelines will support the efficient 
management of the Programme in Brussels in rationalising 
the procedures, while leading to a more systematic 
approach throughout all the partner countries. 
Strengthening structures in the partner 
countries 
The Coordinating Units represent the governments of the 
partner countries and play an important role in defining the 
objectives of the Tacis Programme in their country. They 
have an important role in ensuring close cooperation with 
partner governments and partner organisations. Coordinating Units are run by national representatives 
supported by national experts, supplemented by a small 
number of experts from Member States financed by Tacis. 
In 1995, the contracts for all experts in Coordinating Units 
were renewed. The exceptions were Mongolia, where 
Tacis only started in 1994, and Tajikistan, where the 
operations of the Coordinating Unit were delayed because 
of the civil war in that country. 
In 1995, the Mongolian Coordinating Unit was 
strengthened with an additional expert and is now working 
with two experts. The Coordinating Unit in Dushanbe was 
reopened in 1995 after the relaunch of Tacis in Tajikistan 
in late 1994. The unit is now fully operational with two 
Tacis experts. Tenders have been launched for the 
running of both units in order to ensure continuity. 
Increased monitoring and evaluation 
The monitoring and evaluation process, which was 
initiated in 1994, continued in 1995. Following four years 
of Tacis activity, there were now a sufficient number of 
completed Tacis projects which could be evaluated. The 
monitoring and evaluation teams, composed of 
independent experts from both the partner countries and 
the European Community, completed their reports in mid-
1995. 
The Moscow team evaluated 49 completed projects of 
which 45 were related to 1991 Tacis funds, and four to 
1992. Although these results are promising, Tacis will 
continue to improve its performance and will increase the 
sample of projects to be evaluated in 1996. 
The evaluators indicated that the following factors are 
crucial for the successful implementation of Tacis projects 
. real partnership between the western experts and the 
local partners 
. advance preparation of the experts 
. the right combination of experienced people and 
appropriate activities 
. a set of clearly defined objectives that reflect the local 
context. 
The evaluation report also underlines that Tacis needs to 
put more weight on the long-term sustainability of 
projects, as the scores given for sustainability are generally 
not as high as those given for other key criteria, relating to 
project implementation. 
New evaluation teams 
The original structure of the Tacis evaluation teams was 
replaced in 1995. Instead of a core team for Russia and 
several sector teams, country teams have been 
established in Russia, Ukraine and Kazakhstan. The team 
in Kiev evaluates Tacis projects in Ukraine, Moldova and 
Belarus, and the team in Almaty covers the evaluation in 
the central Asian and the Caucasian countries. 
In addition, the new teams now cover all the financial 
aspects of Tacis projects. Projects in the nuclear safety 
sector, which had been excluded thus far due to their 
technical complexity, are now evaluated. The same 
applies to Tacis framework programmes. 
The new approach to monitoring and evaluation 
complements the reorganisation of the NIS/Tacis 
Directorate and will ensure a better country coherence. 
Projects can be more effectively tailored according to the 
conditions of the relevant partner country. The new 
monitoring and evaluation structure is also consistent with 
the Commission's overall priorities for the evaluation of all 
external aid. 
The setting-up of the new monitoring and evaluation 
teams started in mid-1995 and the contract for the first 
country team was signed in November 1995. 
Tacis communications programme 
Since 1993, the Commission has responded actively to 
the increased interest that the European Community 
institutions and advisory bodies, Member States and 
partner countries have shown in the activities and the 
development of the Programme. The implementation of 
the Tacis communications programme (ECU 3 million) 
was continued in 1995. 
Over the course of the year, a substantial publications 
programme has continued, aimed at explaining the nature 
and activities of the Tacis Programme, and giving 
guidance to all those interested in participating in it, both 
in Europe and the NIS. Tacis has now published over 80 
titles in 12 languages and has distributed over 940,000 
copies through its database alone, which holds the names 
of some 30,000 individuals and organisations interested in 
Tacis. A quarter of these titles are produced in Russian 
and distributed to targeted audiences in the NIS. The review of the Tacis written and visual identity, as the 
key tool in raising the visibility and understanding of Tacis 
in the EC, its Member States and the NIS, has now been 
completed. Its introduction to the Commission Services, 
Delegations, Coordinating Units and contractors has 
started, including a presentation at the EC Moscow 
Delegation in November 1995. 
The Information Unit - Tacis yearly provides speakers and 
supporting material for about 160 conferences, seminars 
and background briefings throughout the Member States, 
and supports Delegations and Coordinating Units with 
material to organise events for about 60 Tacis projects in 
Russia and Ukraine. It responds to some 25,000 
telephone and fax enquiries each year, and receives over 
4,000 visitors. The Information Unit - Tacis is also 
preparing to make information available through an on-line 
service. 
In Russia, the implementation of a specific in-country 
communications programme is underway. Its main 
elements are a range of publications, targetted at existing 
and potential partner organisations, media, and Tacis 
contractors. Tacis now produces a quarterly newsletter in 
Russian. 
In addition, ECU 2 million of Tacis funds were used for the 
implementation of activities to raise the profile of the EU 
within the NIS, and to provide information of a more 
general nature on the European Union. This was carried 
out by the Commission's Directorate General for 
Information, in collaboration with the Delegations in 
Russia, Ukraine, Kazakhstan and Georgia. Principal 
activities include a fortnightly TV programme broadcast 
across the NIS from Russia, and a monthly TV 
programme on Ukrainian Television. In 1995, each 
programme was watched by an average of 4 million 
Ukrainians and 8.5 million Russians. Furthermore, 
publication of the bi-monthly Evropa - a 44-page colour 
magazine in Russian with a 16-page insert in EU 
languages - continued in 1995 with a print run of 100,000. 
10 
Tacis and the European Community 
institutions 
Court of Auditors 
In 1995, the Court of Auditors published its annual report 
on Tacis activities in 1994. This report's conclusions on 
Tacis' fourth year of operation illustrated significant 
achievements in the quality and implementation of the 
Programme. The Court emphasises that despite the 
criticisms levelled at Tacis in the past, the efforts made by 
the Commission to improve the overall operation of the 
Programme should be given proper recognition. The 
Court also acknowledges the difficulties which Tacis 
encounters with the constantly changing political and 
economic environment in the New Independent States. 
The report outlined the improvements in Tacis' financial 
performance, and highlighted successful actions and 
projects. The Court also listed some areas which it 
considered would benefit from increased attention in order 
to improve project quality. 
These issues were proposed for further attention 
. the need for careful identification of projects and 
project partners 
. the need for improved monitoring and setting-up of 
evaluation systems 
. the need for better coordination between donors 
. the need for more investment-orientation of projects. 
Responding to suggestions 
Several of the issues raised by the Court of Auditors have 
been addressed by the Commission. 
Tacis has built up a comprehensive monitoring and 
evaluation system which is now operational. Its monitoring 
and evaluation teams delivered their first results in 1995, 
which concluded that effective evaluation has contributed 
to better project identification on the ground. In addition, 
local partners are increasingly involved in the tender 
process which has helped to raise the quality of selected 
Tacis experts and project sustainability. 
Tacis frequently works with other international donors on 
an individual project basis. In addition, progress was 
made in developing a framework for increased 
coordination of donor activities which facilitate contact 
with other donors across all Tacis sectors at country, local 
and central level. 
While the current Tacis Regulation limits Tacis activities to 
the provision of technical assistance, the Court's 
remaining concerns will be addressed by the new Tacis 
Regulation. The proposed new Regulation offers the 
scope for small-scale infrastructure investments in the 
context of cross-border cooperation, and for the provision of equity capital in the joint venture programme for small 
and medium-sized enterprises. 
European Parliament and the negotiations 
for a new Tacis Regulation 
In 1995 the European Parliament again played a major 
role in monitoring the performance of the Programme, and 
formulating the Tacis budget. 
At the beginning of 1995, the Commission adopted a 
proposal for a new Tacis Regulation for the period 1996-
1999. The proposed Regulation was submitted to the 
Council of Ministers who consulted the European 
Parliament. A number of key amendments were proposed 
to the Regulation. However, by the end of the year no 
overall consensus had been reached in the Council of 
Ministers. 
The new Tacis Regulation contains the main elements of 
previous Regulations, reemphasising the provision of grant 
finance for the transfer of know-how as the central activity 
of the Tacis Programme. The main themes of the new 
Regulation are as follows 
. increased multi-annuality through four-year Indicative 
Programmes for each partner country 
. reinforced conditionality: the possibility of suspending 
assistance to a partner country in the case of violation 
of a key component of cooperation, in particular the 
respect for democracy and human rights 
. small-scale infrastructure projects at border areas, 
and small and medium-sized enterprise joint venture 
equity investment, not to exceed 10 per cent of Tacis 
funds 
. combination of Tacis and INTERREG activities on the 
Russian-Finnish border 
• identification of the environment (institutional 
strengthening, legislation, training) as a priority area 
. reduced ceiling for Direct Agreements from ECU 
300,000 to ECU 200,000 
• an annex setting out the basic principles for the 
awarding of contracts, and in particular those 
awarded by restricted tendering, being revised by the 
Council with qualified majority on the proposal of the 
Commission 
. the remaining implementation modalities (with regard 
to cross-border and industrial cooperation, contract 
information, monitoring and evaluation, progamming, 
coordination and reporting) would make up an annex 
to be revised by the Tacis Committee. 
In addition, in 1995 the European Parliament stipulated 
the following requirements for the execution of the 1996 
Tacis budget: 
11 
a separate ECU 30 million budget line for cross-
border cooperation 
a 10 per cent ceiling on projects to promote 
cooperation in higher education, to include the 
Tempus programme 
a fixed allocation of ECU 50 million for projects designed to protect the environment 
• fixed allocations of ECU 11 million and ECU 1 million 
for the Tacis Democracy programme, and specifically 
for the promotion of a free press, respectively. 
The new Regulation is scheduled to come into force in 1996. 
Bilateral and international cooperation 
The Commission plays an important role in the 
coordination of international assistance in the New 
Independent States. The organisational restructuring of 
Tacis on geographical lines facilitates easier coordination 
with counterparts from other organisations. It has become 
increasingly evident that effective coordination achieves 
better results than single initiatives by one donor. Where 
several donors have formulated a common response to 
issues, the impact on the partner countries has been 
greater. 
Improved coordination with Member States 
The Tacis Partnership and Coordination programme, 
PCP, was in its second year of operation in 1995. With an 
ECU 5 million budget, it continued to cofinance projects 
developed through close cooperation between Member 
State organisations and the Tacis Programme, in pursuit 
of shared goals in the provision of assistance to the NIS. A 
decision was made to allocate a further ECU 10 million for 
the third round of the programme. 
In 1995 Tacis also looked at the type of assistance 
programmes run by the Member States, in order to 
determine how to coordinate most effectively, to 
exchange information on existing activities and ideas for 
future programmes. 
In addition there were regular meetings of the Tacis 
Committee, composed of representatives of Member 
States, which assists the Commission in the 
implementation of the Tacis Programme. These meetings 
provide an important forum for the exchange of views and 
the coordination of activities. 
Coordination with the United States 
Informal working relations between the EU and the US, 
agreed in 1993 and implemented in 1994, were 
strengthened in 1995. The EU-US coordination meeting in 
Brussels in November 1995 sought to develop the current relationship based on of informal information exchange. 
Sessions identified specific areas that would benefit from 
more closely coordinated activities, while Tacis also 
participated in meetings with USAID in 1995. 
Cooperation with the European Bank for 
Reconstruction and Development 
The main arrangement for cooperation between Tacis and 
the European Bank for Reconstruction and Development 
(EBRD) remains the Bangkok facility. In 1995 this allowed 
for ECU 20 million of Tacis funds to be used to provide the 
necessary know-how to support EBRD equity and lending 
projects. 
Additional cooperation has been assisted through a 
series of new operational arrangements agreed by the 
Commission and the EBRD. These improve the 
coordination of joint actions concerning country strategies 
and priorities between the Commission and the EBRD 
both centrally and at local field office level. 
Cooperation with the World Bank 
Cooperation with the World Bank continued in 1995 with 
Tacis participating in a series of consultative group 
meetings for Moldova, Kazakhstan, Kyrgyzstan and 
Ukraine, and in follow-up meetings concerning Armenia 
and Georgia. 
Coordination of activities remains most effective at task 
manager level, particularly with regard to the use of Tacis 
funds to support World Bank loan preparation activities. 
Cooperation with the International Monetary 
Fund 
Increasingly Tacis grants are dependent on the 
International Monetary Fund (IMF) matching loans or 
assisting with balance of payments deficits. 1995 also saw 
the coordination of macro-economic loans to Ukraine and 
Moldova. 
12 
Armenia 
Dialogue between the European Community, its Member 
States and Armenia made significant advances with the 
initialling of a Partnership and Cooperation Agreement in 
December 1995. The Agreement recognises the 
independence, sovereignty and territorial integrity of 
Armenia and emphasises the need for cooperation 
between the states of the Transcaucasus in order to 
further the development of the region. An Interim 
Agreement is being negotiated so that the trade-related 
measures of the Agreement can be implemented as soon 
as possible, while the full PCA awaits ratification. down since 1992 and rail, road and pipeline transport of 
oil and gas products through Georgia is frequently 
disrupted. Armenia also suffers from an antiquated 
national energy distribution network. 
In order to address these energy distribution problems in a 
comprehensive manner, Tacis has established a pipeline 
working group which includes representatives from ten 
New Independent States, including Armenia. The group 
aims to identify and solve regional energy distribution 
problems. 
The political and economic situation in Armenia improved 
in 1995. In the legislative elections in June, the liberal 
democratic reform-minded government remained in 
power and a new constitution was passed in July. The 
cease fire in the conflict with Azerbaijan over Nagorno 
Karabakh is being respected, however progress in the 
Organisation for Security and Cooperation in Europe 
peace talks is slow. Tacis projects in 1995 were directed at the long-term 
goals of modernising the energy infrastructure and 
reorganising the energy sector in order to make it 
commercially efficient. With Tacis support worth ECU 1 
million, an implementation unit for energy sector projects 
will be created within the Ministry of Energy. The unit is 
responsible for developing a long-term energy strategy 
and coordinating national energy projects and resources. 
The government continued its policy of radical economic 
reform and rapid privatisation. As a result, the Armenian 
economy was strengthened in 1995. Armenia was the 
only country of the New Independent States to experience 
positive GDP growth at 5 per cent. Inflation decreased 
drastically compared to the rate in 1994, and the new 
currency, the dram, remained relatively stable. Armenian 
exports to the European Community are also rising. 
Tacis support for reform 
Tacis is supporting the Government in its reform efforts by 
focusing on the following sectors 
• energy 
. enterprise restructuring and development 
• human resources development. 
In 1995, Tacis committed ECU 6 million for the Armenian 
national programme. Armenia also benefited from funds 
committed to the Tacis Traceca programme which aims 
at increasing regional cooperation through more extensive 
transport links. 
Developing the energy sector 
Armenia suffers from a serious lack of domestic energy 
sources and is dependent on imports of energy supplies. 
The main gas pipeline from Azerbaijan has been shut Following a successful 1993-1994 project, Tacis 
continued its efforts to restructure the gas sector in order 
to make it commercially viable. An ECU 1 million project 
focusses on an analysis of the integrity of the main gas 
pipelines, and on a rehabilitation plan for the national gas 
transport system and the distribution system in Yerevan. A 
second ECU 1 million project includes the reorganisation 
of Armgazprom, the state gas company, around its core 
business of supply and transmission as well as the 
restructuring and privatisation of non-strategic activities. 
The Energy Centre established in Yerevan, as part of a 
network of Tacis Energy Centres in the NIS, continued its 
work in 1995. It provides information, training and 
technical support for various energy efficiency initiatives in 
industry and the public service sector. In 1995 the Energy 
Centre carried out energy audits in major Armenian 
industries, identifying wasteful procedures and formulating 
strategies for reduced energy consumption. 
A project for the evaluation of Armenia's hydrocarbon 
deposits has now produced a technical dossier on the 
country's oil and gas potential, as well as a databank for 
the Ministry of Energy. Another project for the 
implementation of a national energy conservation 
programme continued, focussing on energy pricing, 
legislation and restructuring, district heating, industry, 
building, agriculture and transport. The government's top 
13 
priority is the system of billing and collection of payments. 
The project has developed a system for the calculation of 
electricity tariffs and for revenue collection. In two districts 
of Yerevan there have also been successful experiments 
in the creation of non-profit cooperatives dealing with the 
supply of electricity and the collection of customer 
payments. 
Enterprise development 
As a result of the Government's ambitious privatisation 
programme, more than 1,500 enterprises were privatised 
in 1995 and 4,000 enterprises were in the pre-privatisation 
stage. 
Tacis is supporting a project designed to assist the 
Privatisation Commission and Board with the launch of 
the voucher privatisation scheme. The ECU 1 million 
project includes advice to the government on a variety of 
privatisation related issues, the establishment of regional 
auction centres and the provision of advice to enterprises 
on the consequences and responsibilities of privatisation. 
Tacis also continued to support the successful Business 
Communication Centre. The Centre and the Small and 
Medium Enterprise Development Agency merged so that 
business plan preparation and establishment of contacts 
with foreign partners became a single service provided by 
one agency. This has increased the Centre's prospects of 
becoming an independent consulting agency when Tacis 
support ends. 
Continuing human resource development 
Armenia's large national budget deficit has led to reduced 
expenditure and investment, particularly in the human 
resources sector. The education system has been 
particularly affected. Many schools have been closed due 
to a lack of funding and training institutes have cut their 
costs drastically. 
The 1995 Tacis initiatives in human resources 
development are geared at complementing the 
Government's plans for the reorganisation of the 
education sector. Following the generation of much useful data by a previous Tacis policy advice project on 
education, a 1995 project with the Armenia State 
Pedagogical Institute has been reoriented towards 
assistance to the Ministry of Education in Armenia. It aims 
to contribute to the development of effective educational 
management and programming systems, in order to 
adapt the education system to the evolving needs of the 
labour market. 
The 1995 Programme also continued to provide support 
for the Armenian School for Public Administration which 
was established under the 1992 budget. The school is a 
training institute which prepares local and central civil 
administrators for government service. Tacis' 1995 
activities were aimed at implementing the school 
management plan in order to make it sustainable in the 
long term. The ECU 900,000 Tacis project includes 
support for a research unit which identifies and assists 
projects which will continue to develop modern public 
administration structures. 
Funds allocated by sector each year 
1991 1992 1993 1994 1995 Total 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 
Public administration 
reform, social services 
and education 
Agriculture 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 
Total 0.3 
0.7 3.54 
0 1.5 
0 1.66 
1.3 0 
0 0 
0 2.85 
0 0 
0 0 
0 0 
2.3 9.55 2.3 
0 
4.1 
0 
0 
0 
8 
0.8 
17 1.5 
0 
2 
0 
0 
0 
0 
0.5 
6 0.3 
8.54 
4.8 
1.66 
7.4 
0 
2.85 
0 
8 
1.3 
34.85 
Note: Armenia did not receive funds under the 1994 budget. 
14 
Azerbaijan 
Azerbaijan and the European Community and its Member 
States formalised their relations with the initialling of a 
Partnership and Cooperation Agreement in December 
1995. The Agreement establishes a framework for 
cooperation between the European Community, its 
Member States and Azerbaijan and emphasises the need 
for cooperation between the three Transcaucasian states 
in order to promote stability and prosperity in the region. 
An Interim Agreement is being negotiated to bring into 
force the trade-related measures of the Agreement. 
The cease-fire concerning the conflict over Nagorno 
Karabakh held throughout 1995 but peace negotiations 
have not progressed markedly. The dispute over the 
region is draining Azerbaijan's resources and has further 
exacerbated economic instability. The refugees resulting 
from the conflict (some 1 million people) put an additional 
strain on government decision-making. The legislative 
elections in November illustrated the commitment to 
democratic reform, although they were criticised by 
observers. 
In 1995 Azerbaijan's Government attempted to address 
the country's continuing economic decline. Measures to 
decrease the budget deficit were agreed and the 
Government embarked upon an economic reform 
programme. The privatisation process is slow and 
although the decrease in GDP has slowed, there was still 
no growth in 1995. Tacis advisers are working in close 
cooperation with the World Bank and the Government so 
that the privatisation process can continue, and Azerbaijan 
can fulfil the obligations of the recently signed World Bank 
Rehabilitation Loan. 
Tacis reform priorities 
The Tacis Programme is backing Azerbaijan's reform 
process by concentrating on the following sectors 
. energy 
• enterprise restructuring and development 
. human resources development. Under the 1995 budget, Tacis committed ECU 6 million to 
the national programme and also committed funds 
through the Tacis Traceca programme aimed at 
increasing regional cooperation by developing transport 
networks. 
Developing energy potential 
Access to Azerbaijan's oil resources remains an important 
factor in the continuation of the region's development. 
Tacis is supporting the pipeline network in the 
Transcaucasus, Central Asia, Ukraine and Moldova, 
through the newly created Tacis pipeline working group. 
This aims to encourage regional cooperation in energy 
supply distribution. Azerbaijan's vast oil deposits in the 
Caspian Sea can potentially provide the necessary 
impetus and finances to modernise and restructure the 
national economy. 
At the end of 1995 the Government reached an 
agreement with a consortium of western oil companies to 
exploit the Azeri oil fields in the Caspian Sea. The 
agreement anticipates investment of ECU 6.3 billion for 
the development of the two main oil fields and foresees an 
annual output of 40 million tonnes of oil in fifteen years 
time. In 1995 the government of Azerbaijan decided to 
construct a dual pipeline network through both Georgia 
and Russia. 
The Tacis Programme was actively involved in other areas 
concerning the development of the energy sector in 
Azerbaijan in 1995. A project was completed with the 
Azeri Government which included the development of a 
general energy policy, the drafting of an appropriate legal 
framework for energy, and studies aimed at the 
restructuring of the national electricity company Azerenerji 
and oil company SOCAR. The project also included 
energy saving initiatives, training of managers, audits of 
energy companies and development of electricity facilities. 
Two projects were initiated under the 1995 Programme. 
An ECU 1.5 million feasibility study to upgrade and 
complete the Karadag gas storage facility was launched. 
The project's objective is to satisfy World Bank and EBRD 
investment requirements so that planned investment 
needed for the completion of the plant can be allocated. 
15 
The second project comprises support for the drafting of 
energy legislation, taxation and finance issues. The ECU 1 
million project's objective is to facilitate the passing of new 
energy legislation, train SOCAR staff, provide training 
equipment and assist Azerenerji with the implementation 
of its restructuring programme. 
Investing in private enterprise 
Privatisation has not started on a large scale in Azerbaijan. 
There has, however, been progress in developing the 
private sector through joint venture investment and other 
forms of foreign investment. As privatisation of a 
substantial number of small and medium-sized enterprises 
is planned in the future, there will be an increasing 
demand for financial auditors to fulfil the legal requirement 
of annual audits. Tacis has initiated an ECU 1.3 million 
project designed to train a large group of financial auditors 
and receivers and to develop a programme aimed at the 
creation of accepted professional standards for auditors 
and receivers. 
Support for small and medium-sized enterprises was 
another priority in 1995. An ECU 500,000 extension 
project was launched with the Small and Medium 
Enterprise Development Agency, SMEDA. Tacis intends 
to support the three agencies through advice on how to 
develop, strengthen and organise their activities for the 
maximum benefit of small and medium-sized enterprises 
in Azerbaijan. A tutoring programme for businessmen in 
SMEs was also initiated, working through the SMEDA. Upgrading social services 
An ECU 1.3 million Tacis project was launched in 
conjunction with the Azerbaijan Ministry of Labour and 
Social Protection. Support will be provided with a 
strategic review of current legislation and labour policies, 
with specific advice for the General Employment 
Department which provides short-term social support for 
the unemployed and assists them in finding jobs. The 
Department will also be assisted in the setting up of a staff 
training centre, and in developing a computerised system 
designed to match job seekers with current vacancies. 
Funds allocated by sector each year 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 
Public administration 
reform, social services 
and education 
Agriculture 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 
Total 1991 1992 1993 1994 1995 Total 
0 2.6 
0.4 
0 
0 
0 
0 
0 
0 
0.4 2.5 
0 
0 
4.4 
0 
0 
0 
12.5 0 0 1.9 
0 
3.6 
0 
0 
0 
0 
7 1.3 
0 
2.5 
0 
0 
0 
0 
0.4 
6 6.3 
6.1 
2.9 
6.1 
0 
4.4 
0 
8 
1.1 
34.9 
16 
Belarus 
After the conclusion of negotiations, a Partnership and 
Cooperation Agreement with Belarus was signed in March 
1995. The Agreement replaces the 1989 Trade and 
Cooperation Agreement between the European 
Community, the European Atomic Energy Community and 
the Soviet Union, and is concluded for an initial period of 
ten years. It foresees the establishment of intensive 
political dialogue and covers trade in goods, labour 
conditions, the establishment and operation of 
companies, cross-border supply of services, payments 
and capital, competition, intellectual, industrial and 
commercial property protection, legislative, economic, 
cultural and financial cooperation. 
While the ratification of the Agreement is pending, an 
Interim Agreement covering the trade-related aspects of 
the Agreement was initialled in April 1995. 
Political impasse and mixed economic 
signals 
Economic reform in Belarus slowed in 1995, particularly in 
the financial sector. This led to the suspension of the IMF 
programme and the postponement of the second 
instalment of the EC balance of payments loan. 
In March 1995, the Belarussian government called for 
elections for a new Parliament. Due to the complicated 
voting system, a fully operational Parliament was only 
established at the end of 1995. 
This inability to constitute a Parliament almost blocked the 
political system. It meant that there was no significant 
progress in the economic reform programme and that 
economic commitments were not met. 
However, there were signs of stabilisation in Belarus in 
1995, with the macro-economic programme on structural 
adjustment, adopted in October 1994, showing its first 
positive results. The negative growth of the GDP slowed 
down considerably and now stands at minus 11 per cent. 
Due to a strict monetary policy, the inflation rate was 
reduced to 703 per cent from 2,220 per cent at the end of 
1994. On the other hand, the privatisation of the 1,700 regional 
and national enterprises is progressing slowly, as a 
favourable environment for small and medium-sized 
enterprises has not yet been established and the legal 
framework and fiscal incentives are still lacking. 
Increased support - and conditionality 
Tacis funding for Belarus in 1995 amounted to ECU 
12 million. The priorities for the Tacis Programme are 
. enterprise restructuring and development 
• food production, processing and distribution 
• energy 
. transport. 
The 1995 Action Programme was designed in February 
under the assumption that Belarus would progress rapidly 
with reform. In July the Tacis Committee gave a 
favourable opinion on the programme, with the stipulation 
that more conditionality would be introduced at the 
implementation stage. The European Commission agreed 
with the Member States that before the programme could 
be launched, Belarussian commitment to and 
achievement in reforming the relevant sectors would be 
closely reexamined. 
Due to unsatisfactory progress in reforming the economy 
during the second semester, the launching of most of the 
programme has been delayed, with the energy sector and 
Tempus being the only areas where no major delays could 
be expected. However, projects from previous Action 
Programmes were continued or concluded successfully in 
1995. 
In 1995, a feasibility study for an equity investment fund in 
Belarus was completed. The report, commissioned under 
the 1993 Action Programme, drew positive conclusions 
about investment and joint-venture opportunities. The 
fundraising has started and the EBRD is expected to take 
a 30 per cent share in the equity provided that other 
investors are identified to ease the subscription. The fund, 
which should be created in 1996, will work closely with 
the network established throughout Belarus. 
17 
A parallel and related project concluded successfully in 
July 1995. The project, from the 1993 Action Programme, 
prepared three Minsk-based banks to meet the eligibility 
criteria set by the EBRD. The bank's technical skills were 
upgraded and the EBRD's US$ 30 million credit line is 
successfully being disbursed to small and medium-sized 
enterprises. 
Another project successfully completed in 1995 was the 
training of banking personnel in Minsk. The project, from 
the 1992 Action Programme, trained over 30 trainers in 
general and specialised banking skills. The Tacis project, 
based at a training centre in the business school linked to 
the Minsk State University, trained both professionals from 
the banking world and academics from the university. 
Seminars given by Tacis experts, and later local staff, 
taught general and specialised modern banking 
techniques. As the centre charges a fee for the training, it 
is intended that it may become financially self-sufficient by 
increasing the quantity of personnel trained. Funds allocated by sector each year 
1991 1992 1993 1994 1995 Total 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 0.3 7.52 
Public administration 
reform, social services O.i 
and education 1 
Agriculture 1.6 2.51 2 0 
Energy 4.1 1.9 0 0 
Transport 2.24 1 2 1.3 
Policy advice 0 0.7 0 0 
Telecommunications 0 0 0 0 
Humanitarian aid 0 0 0 0 
Other sectors 0 0 1 0.7 
Total 8.92 14.63 9 7 5 21.82 
8.11 
9 
6.54 
0.7 
0 
0 
3.7 
12 51.55 
Georgia 
Georgia and the European Community and its Member 
States initialled a Partnership and Cooperation Agreement 
in December 1995 and started Interim Agreement 
negotiations in order to bring into force the trade-related 
measures of the PCA as soon as possible. The 
Agreement provides a framework for the further 
development of political and economic relations between 
the European Community, its Member States and 
Georgia, and stresses the importance of regional 
cooperation between the three republics of the 
Transcaucasus. The closer relations formalised in the 
Agreement were furthered by the European Commission 
Delegation in Tbilisi, which was opened in 1994. 
The Georgian political situation improved markedly in 
1995. Georgia held both parliamentary and presidential 
elections in November 1995 which affirmed the country's 
commitment to the democratic process. Although 
improvements were registered in the economic field, the 
country continues to be disrupted by the civil conflict in 
Abkhazia. 
The Georgian economy made modest progress in 1995. 
Tighter fiscal and monetary policy reduced inflation and 
the new currency, the lari, introduced in September, 
remained stable. The Government's policy for accelerating 
the reform process has also led to increased privatisation 
of small scale businesses. 
Maintaining the momentum for reform 
Tacis is supporting the Government with its reform efforts 
by focusing on the following sectors 
. energy 
• enterprise restructuring and development 
. human resources development. 
Under the 1995 budget, Tacis made ECU 6 million 
available for the Georgian national programme. Georgia 
also benefited from funds committed through the Tacis 
Traceca programme (which is aimed at developing 
regional transport networks) and through the Democracy 
programme and the policy and legal advice service. Focus on energy 
Tacis is working with national authorities to propose 
solutions for Georgia's energy problems. The lack of 
domestic energy resources and problems with external 
supply have contributed to the energy crisis. Georgia is 
dependent on oil, gas and electricity imports and external 
supply lines have been cut. The energy infrastructure was 
also inadequately maintained and the damage caused by 
the civil conflict added to the disruption. The serious 
energy shortages have obliged the Georgian authorities to 
request a reprioritisation of the Action Programme with a 
greater focus on the energy sector. 
In 1995, an ECU 700,000 Tacis project to support the 
development of an energy policy was extended in order to 
focus on the implementation of the various measures 
identified in the energy policy exercise. A system of 
rational management has been highlighted for introduction 
in order to meet the energy demands of private 
consumers and future private enterprise, and to attract 
foreign investment. The recommendations for an 
integrated energy policy identified energy priorities and 
indicated which steps need to be taken in order to reduce 
waste and improve energy efficiency. The conclusions and 
recommendations were widely accepted by partner 
organisations. An important aspect of the project was the 
drafting of an investment plan which is to be presented to 
foreign investors and international financing institutions. 
In 1995 two new energy sector projects were identified: 
Support for the energy Coordinating Unit (ECU 1.3 million); 
and Support at industry and consumer level (ECU 1 
million). These projects focus on energy policy, pricing, 
legislation, energy efficiency, the promotion of the use of 
indigenous sources like peat and coal, and the asessment 
of wood fuel production. One of the projects' components 
is in training and advising the Preparation and 
Implementation Team preparing the Sakenergo utility 
company to meet the World Bank's and other donors' 
conditions for investment. 
19 
Privatisation continues 
Increasing economic stability in 1995 allowed great 
progress in privatisation, and a mass privatisation scheme 
started in 1995. Over 7,000 SMEs have been privatised to 
date. Tacis support is being given to the Ministry of State 
Property Management for the design and implementation 
of the privatisation programme. Tacis is also supporting 
the Small and Medium Enterprises Development Agency 
and two Business Communication Centres. 
1995 saw the initiation of a post-privatisation programme 
offering support to firms directly following privatisation. An 
ECU 1.2 million Tacis project was put into place to provide 
this support through the Post-Privatisation Development 
Centre. It will assist firms in the assessment of their 
management needs, provide the necessary support in 
marketing and financial strategy, and provide national 
authorities with information concerning the needs of newly 
privatised firms. 
Under the 1995 Programme ECU 700,000 was 
committed to assist in the creation of a securities 
exchange. The project also provides advice on legal and 
tax frameworks and the rules governing the internal 
organisation of the market. 
Research and development for growth 
The Government has requested that the emphasis in 
1995 be placed on strengthening research and 
development capabilities. In December 1994 the Georgian 
Parliament passed a law emphasising the need to gear 
research and development activities towards concrete 
results. The 1995 Tacis Programme initiated an ECU 1.3 million project aimed at assisting the Committee for 
Science and Technology in this endeavour. The project's 
objectives are to evaluate the potential of existing research 
and development programmes, to encourage research 
and development in small and medium-sized businesses 
and partnerships, to train management specialists and to 
encourage the Georgian scientific community to 
participate in international programmes and networks. 
Funds allocated by sector each year 
1991 1992 1993 1994 1995 Total 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 3.5 
Public administration 
reform, social services 1.18 1.25 
and education 
Agriculture 2.65 1.5 
Energy 0.4 0 
Transport 0.73 0 
Policy advice 0 2.75 
Telecommunications 0 0 
Humanitarian aid 0 0 
Other sectors 0 0 
Total 4.96 9 0 3.6 1.9 
1.3 5.53 
1.8 
0 
0 
0 
0 
0 
0.8 0 
2.3 
0 
0 
0 
0 
0.5 
6 5.95 
2.7 
0.73 
2.75 
0 
6 
1.3 
33.96 
20 
Kazakhstan 
The signing of the Partnership and Cooperation 
Agreement between Kazakhstan and the European 
Community and its Member States, in January 1995, was 
a conclusive step in formalising relations between the two 
parties. The Agreement provides a framework for the 
further development of political and economic relations 
between the European Community, its Member States 
and Kazakhstan, and stresses the importance of regional 
cooperation between the five republics of central Asia and 
Mongolia. An Interim Agreement covering the trade 
aspects of the Agreement has been negotiated, and 
procedures have started towards its entering into force. 
Separate agreements covering trade in steel and nuclear 
materials, and nuclear safety and thermonuclear fusion, 
are due to be negotiated. A textile agreement has already 
been drawn up. 
Despite adopting structural reform programmes and an 
ambitious macro-economic stabilisation programme, the 
Kazakh economy has continued to decline. Inflation and 
unemployment rates have continued to rise, and the 
spiralling budgetary deficit remains difficult to control. The 
Government pledged to reduce the budget deficit by 
increasing taxes and restricting spending - including cuts 
in government staff at all levels. 
The Kazakh government remained in favour of rapid 
transformation to a market economy. Following 
discussions with international donors, the Kazakh 
government focused on stimulating production and 
attracting foreign investment in 1995. 
Support for Kazakhstan 
The prime sectors for Tacis action in 1995 were 
• enterprise restructuring and development 
• food production, processing and distribution 
. human resources development. 
Tacis committed ECU 15 million for the national 
programme in Kazakhstan under the 1995 budget. 
Kazakhstan also benefited from Tacis multi-country funds. Supporting the enterprise sector 
Tacis helped to reinforce the Kazakh government's efforts 
to promote small business development at a local level, 
manage the privatisation process at a national and 
regional level, and to achieve a modern financial services 
framework. Many of Tacis' actions for 1995 
complemented actions taken under the 1994 Programme. 
Tacis funding worth ECU 5.9 million supported a number 
of initiatives. The establishment of a Business 
Communications Centre which offers advice to small 
businesses; and a small and medium-sized enterprise 
Development Agency planned for Aktyubinsk which offers 
expertise in developing financial expertise and long-term 
management and technical support for new enterprises. 
Tacis know-how also contributed to an institution-building 
programme and policy advice for the Kazakh government, 
the National Bank of Kazakhstan, and the National 
Congress of Entrepreneurs. 
Tacis also supported the Kazakh government's 
commitment to move forward with a privatisation 
programme. Continued assistance has been given to the 
State Committee for State Property and the State 
Privatisation Fund. Tacis offered policy advice and 
planning to enhance competition and develop long-term 
strategies. Both Tacis' and the partner organisation's main 
concern was the development of the energy sector with 
particular reference to the oil and gas sector. An 
evaluation of the tourism sector was also pursued. 
Practical advice was also given to the new National 
Association of Investment Funds. 
Reshaping the agricultural sector 
Tacis' objectives in this area focused on supporting the 
development of the farming sector in an increasingly 
competitive market. In particular, Tacis supported efforts 
to increase exportable produce, to promote investment in 
agro-industries and to create commercial networks for 
commodities. 
21 
Following Tacis' experience in the Almaty region, a Tacis 
project worth ECU 3 million proposed the development of 
an Agricultural Management Information System in 1995. 
Tacis and the Kazakh authorities aimed at creating an 
Agricultural Marketing and Management Information 
Centre which would provide data on prices and availability 
of inputs. In addition, the project aims to establish a pilot 
wholesale market for fresh produce in the Almaty region. 
Tacis supported the Kazakh authorities in attempts to 
ensure the production and supply of food to the local 
domestic market and also to develop the agricultural 
sector so that future privatisation is an attractive option 
and an economically viable choice for investors. Activities 
in Akmola (the new capital) and Aktyubinsk have been 
started, in order to enhance the food production sector. 
Additional investment is essential in order to develop 
production techniques and to improve efficiency and 
increase production. Tacis know-how supported local 
initiatives in the Almaty and Taldy Kurgan regions to train 
commercial operators in business and accounting 
principles to ensure that resources were used to their best 
advantage. 
Upgrading Kazakhstan's human resources 
Tacis support to this sector has focused primarily on 
providing training to the public administration services 
working with new regulations, and on social protection 
restructuring in an initiative to respond to the increasing 
social consequences of economic reform. 
A project worth ECU 2.9 million helped upgrade the 
management and economics skills base in Kazakhstan. Tacis also helped to develop the new MBA programme at 
the Kazakhstan Institute of Management and Economics. 
Additional Tacis resources will allow KIMEP to strengthen 
its MBA faculty and administration in order to support the 
long-term viability and sustainability of the programme, 
and to enable the faculty to become involved in a network 
of European Business Schools and Universities. Specific 
training has also been provided for the local banking 
system through the courses of the Almaty Bank Training 
Centre and the Banking Advisory Service. 
Funds allocated by sector each year 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 1991 1992 1993 1994 1995 Total 
0 0 0 0 0 0 
0 6.54 6.3 
Public administration 
reform, social services 4.87 
and education 1.4 3.15 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 0.7 
0 
0 
0 
0 
0 3.2 
0 
6.4 
0 
0 
0 
Total 7.73 20.6 0 
0 
0 
0 
0 
1.4 
14 6.3 
Agriculture 2.16 3.06 3.15 3.15 
0 
0 
1.63 
0 
0 
1.12 
14 5.9 25.04 
2.9 14.12 
3 
0 
0 
0 
0 
0 
3.2 14.52 
3.9 
0 
8.03 
0 
0 
5.72 
15 71.33 
22 
Kyrgyzstan 
Kyrgyzstan and the European Community and its Member 
States signed a Partnership and Cooperation Agreement 
in February 1995. The Agreement provides a framework 
for future relations in political, economic, trade and related 
areas. An Interim Agreement was finalised in 1995 which 
will bring the trade-related measures of the Agreement 
into force. 
The government of Kyrgyzstan has consistently illustrated 
its commitment to market-oriented reform and market 
liberalisation, and has experienced a more rapid 
progression than many of the other New Independent 
States. 
Legislative elections in February 1995 established a new 
bi-cameral parliament and a new constitution was 
accepted in October 1995 via national referendum. 
Kyrgyzstan has been ambitious in its economic reform 
efforts and in 1995 began to reap the benefits of this 
approach. The three year reform programme launched in 
1994 to reduce state interference in the economy and 
increase the rate of privatisation is currently being 
enacted. Tight monetary and fiscal policy have resulted in 
greater control of inflation, currency stability and a growth 
of GDP of 2 per cent. None the less, Kyrgyzstan remains 
one of the poorest of the New Independent States, and 
standards of living are low. The European Community has 
provided food aid to Kyrgyzstan for two years running, 
and it it has also received humanitarian aid through 
ECHO. The country is also critically short of energy and 
depends on neighbouring Uzbekistan for its supplies of 
natural gas. Foreign trade is low and the privatisation rate 
is slow. 
Stimulating reform in Kyrgyzstan 
Tacis is supporting Kyrgyzstan's reform programme with 
ECU 8 million committed in 1995. The Programme 
focusses on the following sectors 
• food production, processing and distribution 
• energy 
• human resources development. In 1995 the European Community also addressed 
humanitarian needs with humanitarian and food aid 
projects in conjunction with the ECHO programme. 
Restructuring the agricultural sector 
Kyrgyzstan has suffered a substantial decline in food 
production since independence, yet the reversal of this 
trend has started. In 1995, Tacis initiated two new 
projects, building on the successes of the 1992 Tacis 
project which formulated a strategic master plan for the 
agriculture and food sector. 
Tacis launched an ECU 1.3 million project with the Policy 
and Agro-business Support Unit in the Ministry of Food 
and Agriculture. The project aims to accelerate the 
restructuring of the food and agricultural sector through a 
variety of measures. Through policy advice and 
development, Tacis advisors help to initiate the creation of 
new legislation necessary for a smooth transition to private 
farming and restructuring of the food industry. The project 
supports the development of private farming by training 
farmers, disseminating the benefits of land reform to both 
private farmers and local administrators, and providing all 
involved with information about agricultural markets, 
pricing and distribution alternatives. 
Business management services are being set up to 
support both the newly privatised and soon-to-be-
privatised food processing and distribution firms. The 
service provides training in accounting, marketing, 
finances and investment. Another aspect of the project is 
the definition and enforcement of standards for 
agricultural products and the upgrading of food 
standards. 
Tacis launched a two year Agricultural and Food 
Development Programme in the Issyk-Kul oblast in 1995. 
The ECU 2.4 million project aims to interlink primary 
producers, the processing industries, and markets. It will 
function as a pilot project for similar programmes 
throughout Kyrgyzstan in the future. The main goal of the 
project is to improve the speed and efficiency of 
production, marketing and distribution of food products. 
23 
The private farm development programme includes on-
farm management, the establishment of credit lines for 
businesses in the sector, training of key personnel, and 
product development. The project also offers quality and 
efficiency enhancement, market research, and supports 
the foundation of a local trade association to facilitate 
contact between all those in the food production and 
processing business. 
Modernising the energy sector 
Kyrgyzstan has signed the European Energy Charter and 
the Energy Charter Treaty. This is an important step in 
facilitating much needed foreign investment for the 
country's energy sector. The Kyrgyz National Energy 
Holding Company and Tacis are working together to 
address a number of energy issues and to develop a 
strategy for the sector for the next ten years. The ECU 1.1 
million project includes the following issues: support for 
the drafting of energy and electricity laws, advice on 
energy strategies, the promotion of energy saving, training 
of managers in the energy sector and supply of energy 
equipment. 
In 1995, Tacis also initiated a project valued at ECU 
600,000 to support the State National Coal Company 
Kyrgyz Komur with high level policy advice and training. 
Strengthening the civil service 
Kyrgyzstan and Tacis are working to strengthen the 
structure of the civil service and to facilitate the enactment of policies throughout the administration. Through an ECU 
1.6 million project, Tacis is providing advice on the 
management and development of service and staff 
management issues such as selection criteria, recruitment 
and career development. The programme also includes 
in-service training and supply of equipment as well as a 
monitoring plan to establish whether policy is enforced 
across all levels of the administration. 
Funds allocated by sector each year 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 
Public administration 
reform, social services 
and education 
Agriculture 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 
Total 1991 1992 1993 1994 1995 Total 
0 0 0 0 0 
0 0.82 
0 0 
0.7 
0 
0 
0 
0 
0 0 2.71 
0 
0 
5.7 
0 
0 
0 
0.7 9.23 0 
2.6 
4 
2.4 
0 
0 
0 
0 
1 
10 0 
1.6 
1.7 
0 
0 
0 
0 
1 0 0.82 
4.2 
3.7 10.41 
4.8 
0 
5.7 
0 
0 
2 
8 27.93 
Note: Kyrgyzstan did not receive funds under the 1994 budget. 
24 
Moldova 
Relations between Moldova and the European 
Community and its Member States are formally based on 
a Partnership and Cooperation Agreement which was 
signed in November 1994. The Agreement provides a 
framework for political, economic, trade and cultural 
relations. In order to bring into effect the trade-related 
measures of the Agreement, an Interim Agreement was 
signed in October 1995. 
1995 saw a stabilisation of the political situation in 
Moldova. In January 1995 the Gagauz region was given 
autonomous status, removing a potentially destabilising 
issue from the political agenda. The separatist tendencies 
of the trans-Dniester region continued to disrupt the 
country's development. Negotiations to find a settlement 
did not reach solid conclusions in 1995. 
The Government's reform efforts in 1995 resulted in a 
GDP growth of 1.5 per cent, the first rise since 
independence. A rigorous monetary policy has reduced 
inflation to 2 per cent and the currency, the leu, remained 
stable. Moldovan exports increased substantially in 1995, 
especially to the European Community where exports 
almost doubled. 
In December 1995, the Government successfully 
concluded a mass privatisation campaign which 
auctioned off 1,132 large enterprises. The lack of foreign 
investment remains a problem which the Moldovan 
authorities hope to address by continuing with a stabilising 
monetary policy and increasing the privatisation of firms. 
Tacis priority sectors 
In order to support Moldova in its reform efforts, the 1995 
Tacis Programme committed ECU 9 million to the 
Moldovan national programme. The Programme focused 
on the following sectors in 1995 
. food production, processing and distribution 
. enterprise restructuring and development 
• energy 
. human resources development. 
Moldova also benefited from Tacis multi-country funds. Modernising the food sector 
An ECU 1.3 million project was agreed upon in 1995, 
aimed at improving the marketing of agricultural products. 
The project, run in conjunction with the Ministry of 
Agriculture and Food and the Export Promotion Centre, 
aims to improve the operation of private sales of 
agricultural products. It also helps to create pilot marketing 
operations with tradesmen and encourages the creation 
of independent professional federations. Following the 
break-up of the Soviet Union, Moldova lost much of its 
traditional export market. The Tacis project assists the 
Moldovan agricultural community to regain these export 
markets, to develop new export opportunities and to 
improve domestic marketing. 
Two other projects were developed in 1995: the 
improvement of seed quality (ECU 400,000) with the 
Moldovan agricultural firm Semintse, and the development 
of credit to private farmers (ECU 800,000). The first 
project's aim is to modernise production and improve the 
quality of vegetable seeds by introducing new varieties 
and encouraging contact between seed producers in and 
outside Moldova. The second project addresses the 
growing demand at private banks for credits. Tacis is 
helping to increase the capacity of the credit institutions to 
handle the rising credit demands of private farmers by 
providing training and advice at the Agroindbank and 
training of private operators in credit management. 
Privatising enterprise 
Moldova's privatisation programme has set a target of 
privatising an additional one-third of state companies 
under its 1995-1996 programme. If these plans are 
successfully implemented a total of two-thirds of state 
property will have been privatised. Tacis supported the 
privatisation drive through two projects. Firstly, support 
continued for the successful 1994 Business Centre of 
Moldova project in Chisinau. In order to disseminate 
information about various aspects of privatisation, the 
Centre has created affiliated centres throughout Moldova. 
An ECU 500,000 Tacis project aims to reinforce the 
expert team at the Centre and develop relationships 
between local and international institutions in order to 
attract financial support and assist enterprises to devise 
and implement business strategies. 
25 
A second project, the ECU 1 million Tacis enterprise 
isolation programme, will commence in 1996. It will help 
identify insolvent enterprises and provide advice either to 
restructure them, liquidate them, or support them through 
loans systems. 
Conserving energy - a priority 
In the energy sector, Tacis committed support worth ECU 
1.25 million for the national Energy Efficiency Office, which 
was set up under the 1992 Tacis Programme. The office 
ran two projects on energy conservation in 1995, both of 
which were directed at the development and 
implementation of conservation policy. 
Another project launched in 1995 provides policy advice 
to the State Department of Energy concerning the costs 
and benefits of possible alternative sources of energy 
supply. 
Developing Moldova's skills base 
In the human resources sector, two projects were 
completed in 1995 and two new ones identified. The 
employment services project (ECU 1 million), aimed at 
reinforcing the labour market and strengthening the 
employment programme at the Ministry of Labour and 
Social Protection, was successfully completed. The ECU 
1.25 million management training project at the Academy 
of Economic Sciences was completed successfully and 
some 30 of the trained managers are now working at the 
Academy. In 1995 two projects were launched: the reform of the 
social protection system (ECU 1.5 million), and support to 
the health sector (ECU 500,000). The first project aims to 
develop a new social protection system and an 
accompanying legal framework through advice to the 
Moldovan government. The second project is designed to 
support the Moldovan health authorities to address 
primary health care systems and the reform of health 
management. 
Funds allocated by sector each year 
1991 1992 1993 1994 1995 Total 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 0 1.73 
Public administration 
reform, social services 0.13 2 
and education 
Agriculture 0.97 2.27 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 
Total 0 
0 
0 
0 
0 
0 
1.1 0 1.45 
1.9 1.5 
4.7 
0.6 
0.6 
0 
0 
0 6.03 
2.5 10.44 
0 0.75 
0 10 1.5 
0 
0 
0 
0 
1.5 
9 4.1 
0.6 
1 
0 
0 
2.25 
29.1 
Note: Moldova did not receive funds under the 1993 budget. 
26 
Mongolia 
The dialogue between the European Community and 
Mongolia intensified during 1995, and included a visit to 
Brussels by President Ochirbat. 
A priority for the Mongolian government is strengthening 
the national economy through increased industrial 
production. With up to 40 per cent of the state budget 
currently subsidising unprofitable state enterprises, future 
economic growth in Mongolia is largely dependent on 
developing the private sector. Important sectors in the 
economy, including services and agro-processing, have 
been fully privatised and large state-owned companies 
have been replaced with small and medium-sized 
enterprises. 
Maintaining support for Mongolia 
The 1994-1995 Tacis Action Programme continued to 
build on the projects that were initiated during 1994. In 
that year a budget of ECU 8 million was allocated for 
Mongolia, which focused on the following activities 
. human resources development 
• enterprise restructuring and development 
• energy. 
Developing human resources 
The Tacis objectives for human resources development in 
Mongolia focus on developing the skills necessary for the 
effective implementation of social protection measures, 
and the operation of efficient new economic operators. A 
project for the reinforcement of employment services was 
allocated a budget of ECU 1.2 million for 1994-1995. The 
objective of this project is to support the Ministry of 
Labour and Population Policy and also to put in place 
policy elements concerning the management of 
unemployment. 
The Tacis project Reform of economic education (ECU 2 
million) has initiated the restructuring of the curricula and 
organisation of the Mongolian National University. The 
objective of this Tacis project has been to contribute to 
the adaptation of economic education to the needs of a 
free market economy. 
Optimising business development 
Tacis support for small and medium-sized enterprises 
continued throughout 1995, particularly in the agro-
processing sector. The objective for enterprise 
restructuring and development projects remains the provision of high level policy advice to the Government in 
small and medium-sized enterprises development 
techniques. 
The past four years have witnessed the establishment of 
29,000 new firms and cooperatives. The current Tacis 
project has been building a framework for new business 
associations, which provide an important support function 
to the newly established companies. 
Improving energy supply 
The availability of reliable and cost-effective energy is the 
key to the continued development of private businesses. 
Tacis has therefore initiated an energy project with the 
objective of improving the reliability of the power plants in 
Dharkan and Choibalsan in rural Mongolia. The ECU 1 
million project now works with both cities, and has been 
implemented to find cost-effective means to improve the 
efficiency and reliability of local energy supply. The 
Darkhan project is aimed at providing a cost/benefit 
analysis design for its upgrade. In Choibalsan the project 
is analysing how to extend the plant's life by a further 10 
to 20 years. 
Funds allocated by sector each year 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 
Public administration 
reform, social services 
and education 
Agriculture 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 
Total 1991 1992 1993 1994 1995 Total 
0 0 0 0 0 0 
0 0 0 2.56 
0 3.8 0 2.56 
3.8 
0 0.64 0 
0 8 0 0 
1 
0 
0 
0 
0 
0.64 
Note: Mongolia did not receive funds under the 1991 -1993 budgets. 
The 1994 budget also covered activities in 1995. 
27 
Russian Federation 
Russia's economy showed signs of further stability in 
1995. Despite the overall macro-economic trends 
remaining negative, the main indicators illustrated that real 
improvements had been made in key areas. 
Russia progressed further towards the establishment of a 
market economy in 1995. The real gross domestic 
product improved compared with 1994 figures, from 
minus 15 per cent to minus 4 per cent. Overall industrial 
production also increased from minus 21 per cent to 
minus 3 per cent, mainly due to gains made by traditional 
heavy industry. 
The financial position of the Russian Federation improved 
slightly in 1995. The budget deficit improved by 6 per cent 
to minus 4 per cent of GDP. The inflation rate continued to 
fall, from 840 per cent in 1993, to 215 per cent in 1994, 
falling again to 131 per cent in 1995. Currency 
depreciation continued slowly in an attempt by the Central 
Bank to compensate for inflation. However, this largely 
stabilised the currency from mid-1995 onwards. 
The Russian Federation's trade surplus increased further 
in 1995 to ECU 25 billion. This represents an increase of 
ECU 6.5 million on 1994's figure. Russian trade with the 
European Community has also improved, with the 
Community remaining Russia's largest trading partner. 
Social consequences of reform 
Unemployment rose to 8.2 per cent of the work force in 
December 1995, from 7.1 per cent in 1994. A decline in 
real income by 12 per cent on 1994 figures also poses a 
considerable problem for the Russian authorities. Wages 
decreased by 31 per cent and pensions by 15 per cent. 
Delays and non-payment of wages is one of the more 
pressing problems and affected approximately 1 million 
people per month across Russia throughout 1995. 
Meanwhile the avoidance of tax and social fund payments 
by not registering wages is an increasingly common 
feature of the Russian economy. As real living standards 
continue to decline, the reform programme is increasingly 
being questioned by the general populace, which led to 
increased strike action and collective labour disputes in 
1995. Relations with the European Union 
The entering into force of the Interim Agreement, designed 
to implement the trade and commercial aspects of the 
Partnership and Cooperation Agreement, was delayed in 
1995 due to the European Union's concerns with respect 
to the conflict in Chechnya, and the repercussions 
connected with the human rights situation in that region. 
The Interim Agreement was, however, signed in July 1995 
and the procedures to bring it into force were launched. 
The Agreement will operate until the more comprehensive 
Partnership and Cooperation Agreement comes into force 
following the assent of the European Parliament, and the 
Parliaments of the Member States and of the Russian 
Federation. 
Duma elections 
As part of a major programme involving 32 countries, the 
Tacis Democracy Programme supported the monitoring 
of the Russian elections for the Second House of the 
Duma, which were held in December 1995. It also carried 
out a voting awareness campaign specifically in the St 
Petersburg region. 
The monitoring effort concluded that across 95,000 
polling stations, involving a potential 105 million potential 
voters, democratic practices continue to improve with 
each election. Public interest in the Duma elections was 
high, as illustrated by a 64.4 per cent voter turnout. 
Russia's ability to hold elections in a free and democratic 
way is one of the signs that political reform remains on 
track. For the first time, the new Russian Federation 
successfully transferred constitutional power from one 
legislature to a successor. 
Tacis priority sectors and regions 
Tacis priority sectors in the Russian Federation for 1995 
were 
enterprise restructuring and development 
human resources development 
food production, processing and distribution 
energy 
transport 
telecommunications. 
28 
Tacis regional funding for 1995 concentrated on 
. the Lake Baikal region 
. north-west Russia. 
The Tacis 1995 budget committed ECU 161.19 million for 
the national programme in Russia. Russia also benefited 
from Tacis multi-country funds, including ECU 38 million 
for the nuclear safety sector. 
Tacis priority sectors 
Restructuring and establishing enterprises 
The privatisation process in Russia progresses, while the 
restructuring of privatised enterprises remains difficult to 
implement. Over two-thirds of newly privatised companies 
are still controlled by their former management, who slow 
the pace of change. Towards the end of the year the 
Prime Minister declared a reduction in the scale of 
privatisation so that Russia could move from quick, mass 
privatisation to individual sales designed to boost 
production efficiency. 
In June 1995 the State Committee of the Russian 
Federation for the support of small businesses was 
created by presidential decree, and passed by the Duma 
in July. Along with numerous official endorsements on the 
role of private enterprise in Russia, this development has 
had a positive impact on the coordination of Tacis projects 
seeking to establish long-term institutions supporting 
enterprise development, particularly in the Russian 
regions. 
Tacis' main priorities for 1995 complemented those of 
1994, and covered training in corporate finance, 
enterprise restructuring, support to the second stage of 
privatisation, sectoral and small and medium-sized 
enterprise assistance and support for the national Russian 
agencies responsible for the development of the market 
economy. To help develop long-term strategic support, 
monitoring and forecasting of small and medium-sized 
enterprises development was added to the list of priorities. 
In 1994, a commitment was made to support the 
privatisation process when a regional network of 13 post-
privatisation consulting centres was planned. During 
1995, six of these centres were fully established, of which 
three technical assistance centres in Novosibirsk, Barnaul 
and Kemerovo aim to help with problems of restructuring. Three enterprise support centres in Perm, Ekaterinburg 
and Chelyabinsk prepare organisations for investment. 
Funding for these established centres and others in 
development for 1995 totalled just under ECU 30 million. 
For smaller enterprises, a network of 23 Development 
Agencies was established in 1995. Between the Moscow 
and St Petersburg agencies alone, over 3,500 prospective 
entrepreneurs have been offered business development 
advice. In the autumn of 1995 an executive decree was 
signed making the Development Agency network an 
official element of the Government's privatisation 
programme. 
In the financial sector, Tacis provided funding worth ECU 
5 million to the Financial Institutions Development Project, 
which was established in partnership with the European 
Bank for Reconstruction and Development and the World 
Bank. The project aimed to provide twinning services for 
36 Russian banks in order to improve and develop 
corporate financial services. 
Support for the agriculture sector 
Overall agricultural output fell by 10 per cent in 1995. The 
Russian grain harvest hit a record low of 64 million tonnes 
in 1995 (from 81 million tonnes in 1994). This was partly 
due to a drought across the Volga region and central 
Russia in May-July 1995. 
In addition to the low levels of agricultural output in 1995, 
the development of private and cooperative agriculture 
progressed far more slowly than the privatisation of 
industry and commerce - a continuation of 1994's trend. 
The agricultural sector's legislative agenda changed little in 
1995, primarily due to the failure of the Land Code to pass 
through the Duma. This code, which outlines the legal 
situation for private land ownership, has been pending 
ratification for two years. Without the Land Code being 
enforced, it is unclear how agricultural land can be sold. 
Legislation giving legal status to agricultural production 
cooperatives was however passed in December 1995. 
Tacis' primary focus in 1995 was the identification of 
successful and complementary agricultural projects, the 
findings of which could benefit additional projects both 
locally and nationally. The development of wholesale 
marketing (in the Samara and Moscow regions) and farm 
29 
restructuring and support to private farmers (developed in 
the Leningradskaya region) were two of the key subjects 
for dissemination. Improvement of input supplies for 
agricultural producers, specifically of seeds and fertilisers, 
was included as a key focal area. 
Fisheries and forestry development also merited special 
attention in 1995. An ECU 2.5 million Tacis project in 
Murmansk was established to improve fish distribution 
networks throughout Russia. This project complemented 
an existing ECU 1.5 million project improving fishing fleet 
and processing structures. In Karelia and Lake Baikal, 
reforestation initiatives were developed, following previous 
massive exports of timber. Training in forest management 
and harvesting methods was also started. In Baikal, 
studies were prepared developing environmentally 
preferable forms of animal husbandry. 
Notable projects in 1995 were implemented in Kemerovo 
and Novosibirsk in Siberia, and Chelyabinsk and Perm in 
the Urals. The two former projects included the opening of 
a wholesale market and establishment of producer 
associations. The latter included the restructuring of two 
large collective farms, the improvement of the production 
of agricultural equipment and initiatives for increased 
equipment sales. 
Capitalising on military conversion 
Tacis support aims to save the scientific and industrial 
potential of former defence production units and research 
and development institutes, by supporting their 
conversion plans. It supports new enterprise management 
and promotes the development of industrial partnerships 
and joint-ventures with European partners. 
In St Petersburg, a Tacis enterprise restructuring project 
supported the restructuring of the Izhorsky power 
engineering plant. A holding company was established to 
promote the creation of new enterprises using the old 
plant's industrial assets. Tacis experts also provided 
expert support for approved projects in technical, legal, 
financial and human resources areas. 
High-level policy advice was given to the State Committee 
of Defence Industry. Additional individual projects included 
assistance to the Institute of Aircraft Equipment, and 
support for the Russian Record Rocket engine 
programme. Total funding for the military conversion 
sector in Russia was ECU 7.2 million. Human resources - a continuing priority 
Unemployment continued to rise in 1995. Extensive 
debates continued concerning the social consequences 
of privatisation. As in 1994, Tacis priorities in the sector 
addressed these issues. Tacis experts have provided 
training in business, economics and management; and 
advice on public administration, social protection and 
health care reform. Particular support was provided to 
regional administrations, reflecting the general focus on 
regional, rather than centralised, activities. 
In the south-west (Stavropol, Krasnodar and Rostov) an 
ECU 3.4 million Tacis project was set up to strengthen 
business and economics teaching and research. In the 
Urals and western Siberia two projects, both with budgets 
of ECU 2.5 million, focused on strengthening public 
administration through policy advice and expanding 
training capacity. 
Tacis experts worked alongside the State Committee of 
Higher Education and the Ministry of Education in 1995, 
on an ECU 2 million training and education project. This 
project aimed at developing the management and 
organisational aspects of education in a market economy. 
One of Tacis' largest projects - the officer retraining 
project which started in 1994 (ECU 14 million) - reached 
its mid-term evaluation point in 1995. New elements such 
as mobile teaching units and training in job-seeking and 
application processes were introduced. The project will 
continue until the end of 1996. 
Energy, environment and science 
Under-performance in gas, oil, electricity and coal 
production continued throughout 1995, whilst 
transportation methods, distribution and consumption 
levels remained inefficient. Energy prices stabilised to a 
certain extent but failed to be cost-effective, particularly in 
the domestic sector. By contrast, industrial prices 
approached cost-effectiveness. Developing this sector 
has always been a priority for Tacis in Russia. 
Two new energy centres were established in 1995, in 
Ekaterinburg and Novosibirsk, bringing the total number of 
energy centres funded by Tacis in the Russian Federation 
to four. A fifth energy centre, in Tyumen, is funded by the 
European Union's Thermie Programme. These centres 
have been set up to provide a focus for a range of 
activities aimed at stimulating efficient energy production 
and use. It was agreed that the work of the existing 
Moscow and St Petersburg centres should be continued 
for two years. 
30 
Environmental activities in the Lake Baikal region 
demonstrated the effectiveness of cooperation in 
environmental protection. The comprehensive regional 
development plan took into account all the environmental 
issues in the area. However, despite cooperation 
achieving results for some small projects, Russia is still 
lacking a coherent approach for tackling more 
fundamental environmental problems. 
The International Science and Technology Centre 
continued to develop in 1995 with the main objective of 
funding civilian research projects and thereby redirecting 
weapons scientists and engineers to peacetime activities. 
The centre is funded by the Russian Federation, the 
European Community, the European Atomic Energy 
Community, Japan, the United States and Sweden. By 
the end of 1995 the centre was supporting over 11,000 
scientists from the New Independent States. Projects 
funded by the centre were valued at ECU 104 million. 
Broad support across the transport sector 
In 1995, ECU 12.5 million were allocated to the transport 
sector in Russia. Projects identified covered air transport, 
ports, road and rail, space navigation and transport 
economics, with a particular focus on North West Russia 
where the ports of Murmansk, Archangelsk and their 
hinterlands will receive assistance in the improvement and 
facilitation of the handling of goods, traffic forecasting and 
staff training. The port of St Petersburg will receive 
assistance to complete actions undertaken in 1992 and 
1994. The approach to transport is now more integrated 
and multi-modal special attention is being given to the 
creation of institutional bodies and legal frameworks, and 
to assisting private operators. 
Tacis priority regions in 1995 
North-west Russia - a gateway to Europe 
When Finland joined the European Union in January 1995, 
Russia's first border with the European Community was 
established. This was an important step to encourage 
trade relations between Russia and the European 
Community. Tacis' activities reflected this, with a majority 
of the regionally focused budget (ECU 27.5 million) spent 
in the Karelia, Archangelsk and Murmansk regions of 
north-west Russia. One-third of Tacis' transport budget 
for 1995 was allocated to encouraging the generation of a 
network of transport corridors for trade and specific 
projects for the ports of Archangelsk and Murmansk. Lake Baikal - environmental initiatives 
Industry in the region is increasingly threatening this 
unique lake's eco-system. Tacis projects concentrated on 
specific environmental objectives - decreasing the air 
pollution from the Angarsk oil-chemical company and 
Irkutsk thermo-electric power station, sewage disposal 
and the major reconstruction of the Baikalsk pulp and 
paper plant. Tacis committed ECU 14 million to sectoral 
investment and advice which included enterprise 
restructuring, human resources development, energy 
policy and efficiency, natural resource management and 
environmental information campaigns. 
Framework programmes 
Framework programmes package together projects on a 
smaller scale, or those of a similar type, under one 
umbrella so that services can be delivered quickly and 
efficiently. They complement the conventional Tacis 
programming process which sets up individual projects, 
usually of a much larger size. The following outlines the 
type of projects covered by some framework programmes 
in Russia. 
Bistro programme 
The Bistro programme is designed for the quick 
implementation of small projects with a brief life span. The 
average contract amount in 1995 was ECU 64,000. 
Managed by the Tacis section of the Delegation of the 
European Commission in Moscow, the most common 
Bistro projects are conferences, seminars, workshops, 
training and sector studies - some of the most visible 
aspects of the Programme. Some examples of activity in 
1995 include the organisation of an Environment Week in 
the St Petersburg region (which has subsequently been 
adopted by the local administration as an annual event), 
and studies in areas such as Soya development in the 
Krasnodar region and an assessment of the basic needs 
of mentally handicapped children in Segesha district. 
Stimulating greater productivity 
The Productivity Initiative framework programme has 
generated positive responses from senior-level European 
and Russian participants. The programme aims to change 
Russian management methods in private and state-
owned sectors through intensive training seminars and 
three-month work placements for Russian executives in 
western companies. In many ways the Productivity 
Initiative programme represents a reverse process from 
31 
the usual know-how structure, in that the know-how is not 
'delivered' to partner organisations but has to be sought 
out by them. In 1994, 40 executives took part in the 
programme. In 1995, ECU 5.5 million was contracted and 
200 work placements took place, with a further 100 
arranged for 1996. 
The new monitoring and evaluation team 
A new monitoring and evaluation team started work in 
September 1995. With a staff of twenty Moscow-based 
experts and a further eight local experts in the field, the 
team reflects the new geographical approach in Tacis. 
The team visits projects regularly and reports on a 
quarterly basis. Improvements were made on previous 
quarterly coverage, and for the first time all of Russia's 
320 Tacis projects were evaluated. The European 
Commission's Delegation in Moscow concentrated on 
the supervision of projects in tandem with the monitoring 
and evaluation team. This will allow any potential 
difficulties to be identified and resolved earlier in the 
project cycle. 
Relationships with other donors 
Tacis cooperates closely with other donors active in the 
Russian Federation, such as the World Bank and the G7. The European Bank for Reconstruction and Development 
strengthened its local representation in Moscow, which 
has enabled Tacis to work even more closely with it in 
preparing projects for financing. 
Funds allocated by sector each year 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 
Public administration 
reform, social services 
and education 
Agriculture 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 1991 1992 1993 1994 1995 Total 
12.; 0 12.1 
27.2 29.76 54.5 43.4 40.6 195.46 
46.64 24.57 44 18.85 52.8 1i 
50.85 21.49 12.5 16.3 17 118.14 
41.5 16 21.1 19.5 18 116.1 
32.87 14.25 13.55 13.9 12.6 87.17 
0 0 0 18.95 0 18.95 
0 4.93 5.1 4.1 5.4 19.53 
0 0 0 0 0 0 
0 0 10 15 14.79 39.79 
794.89 Total 211.95 111 160.75 150 161.19 
32 
Tacis 
Maximising resources and minimising waste: 
Tacis in the NIS energy sector 
NIS energy 
The New Independent States - and Russia and the states 
of Central Asia in particular - are among the world's most 
important producers of energy. These countries have 
large reserves of oil and gas, with exports accounting for a 
large proportion of hard currency earnings. 
However, across the NIS the energy sector faces a 
number of serious problems, largely due to the production 
of cheap energy, especially for industry, with little attention 
paid to energy efficiency, in supply and usage. 
More recently, the sector has suffered from a lack of 
investment which has aggravated inefficiencies and 
wastage in supply, and from the postponement of new 
energy supply projects. Meanwhile the environmental 
implications of energy production and wastage are huge. Tacis initiates major energy reforms 
The reform and modernisation of the energy sector is 
crucial to the process of building up a market economy, 
and for five years Tacis has been playing an important role 
in the sector, transferring know-how and promoting pilot 
and demonstration projects which are designed for 
replication. 
It operates alongside and in close coordination with other 
donor organisations, particularly the World Bank and the 
European Bank for Reconstruction and Development. An 
important point of departure for its activities is the 
European Energy Charter, which aims to promote the 
development of a larger energy market throughout 
Europe, while improving the security of energy supply, 
efficiency and safety, and minimising environmental 
problems. 
Each energy resource presents its own problems and 
challenges. Oil and gas production levels, for instance, 
need to be maintained and coupled with energy saving 
measures. Nuclear power, which accounts for some 12 
per cent of electricity generation in Russia and 34 per cent 
in Ukraine, must be subject to intense scrutiny, epecially 
regarding the safety of older reactors and the 
establishment and effective operation of independent 
regulatory authorities. Over 150 Tacis energy projects have now been carried 
out - in Belarus, the three countries of the Caucasus, 
Kyrgyzstan, Moldova, Mongolia, Russia, and Ukraine. 
ECU 228.01 million have been allocated to the energy 
sector over the period 1991-1995, of which Russia has 
received ECU 116.1 million and Ukraine ECU 41.58 
million. The remaining Tacis partner countries have all 
benefited from energy projects within the Tacis multi-
country programme. 
Meanwhile energy wastage is such that western experts 
have estimated that the NIS industrial sector should 
reduce its requirements by up to 40 per cent. In the longer 
term, the solution to this problem lies in the adoption of 
prices which are more closely related to the real costs of 
production and supply, and to the demand for specific 
energy carriers. Programme activities 
Tacis activities in the NIS energy sector are at both 
operational and institutional level, and come under 
four broad headings 
• energy efficiency and conservation 
. rehabilitation and modernisation of oil, gas 
and electricity production, transmission and 
distribution 
. support for legal and administrative frameworks 
. coal sector restructuring. 
33 
Each of the Tacis partner countries 
poses very different problems and 
challenges in the energy sector. 
Situations range from that in Armenia -
where water and electricity can at 
times be available for only an hour a 
day - to Uzbekistan and Kazakhstan, 
which are comparatively rich in 
resources. Tacis activities are oriented 
according to the quality and quantity of 
the energy resource, the efficiency of 
infrastructure, and the country's status 
as a net energy exporter or importer. 
Georgia Moldova 
As a pure importer of energy, 
Moldova has been badly hit by 
the rise in energy prices, and 
remains beholden to Russia for 
the bulk of its supplies. It can 
improve its own situation by 
promoting energy saving and 
efficiency in the industrial, 
commercial and domestic 
sectors. 
Georgia's only significant indigenous source of 
energy is hydroelectric power, which has meant 
that it is now heavily dependent on imports, which 
are no longer subsidised. The country's energy 
infrastructure is old and in bad condition due to 
inadequate maintenance and inappropriate 
operational practices. 
Armenia 
The main constraints for Armenia's economic 
growth lie in the limited availability of its natural 
resources, while obsolete technologies and 
inefficient practices make its industry energy-
intensive. The country relies heavily on imports 
of energy products. As such, consumption has 
dropped rapidly. The country needs to develop 
its domestic hydrocarbon deposits to relieve 
some of the dependence on imports. 
Azerbaijan 
The country has proven oil reserves which may 
become the foundation for the restructuring of its 
economy. However, its production levels have 
fallen due to low investment levels and bad pipeline 
networks. 
Turkmenistan 
Turkmenistan boasts major oil and gas 
reserves. In the past it has focused on 
regional markets, but is now turning its 
attention to Europe and Asia. Ukraine 
Ukraine has an energy import dependence, 
worsened by the growing costs of imported 
energy following the break-up of the former 
Soviet Union. The G7 Action Plan required the 
restructuring of Ukraine's energy sector: viable 
options are to diversify both the energy mix 
and the supply countries, and to encourage 
energy saving and efficiency. 
34 Uzbekistan 
Endowed with large natural gas deposits and newly-
discovered oil, the country is potentially self-sufficient 
in energy. However, expert advice is required to 
make the sector viable and to satisfy international 
financing criteria for investment. Kyrgyzstan 
The country has no significant oil or 
gas reserves. It is, however, rich in 
hydroelectric capacity and plays a key 
role in the region's water distribution 
system. 
Belarus 
With few local energy resources, Belarus has 
suffered sharply from the high cost of 
importing its fuel. Energy is one of the key 
sectors affecting its balance of payments 
deficit. The government has taken steps to 
institute key reforms in the energy sector and 
recognises that there is, inter alia, great 
potential for improving energy efficiency. Kazakhstan 
Kazakhstan has very significant 
oil and gas reserves, and is 
committed to promoting foreign 
investment in its energy sector. 
Tajikistan 
A large hydro-electric power potential has been only partially 
exploited, and the availability of abundant water resources allows 
the country to increase its electricity production both for local 
consumption and export, alleviating the pressure caused by the 
need for imported oil, gas and coal. Russia 
The energy sector constitutes an 
important basis for Russian economic 
restructuring, accounting for two-thirds 
of Russia's exports to the EU. The 
sector remains distorted by pricing 
policies, torn between the pressure to 
raise prices to economic levels and the 
political necessity of keeping energy 
prices affordable. There are natural 
monopolies in electricity and gas which 
need to be regulated, while the sector 
still suffers from excessive wastage. 
EC Energy centre 
Total expenditure 
Budgets committed by the Tacis Programme 
to the NIS energy sector in ECU million 
1991 1992 1993 1994 1995 Total 
Armenia 
Azerbaijan 
Baltic States 
Belarus 
Georgia 
Kazakhstan 
Kyrgyzstan 
Moldova 
Mongolia 
Russia 
Tajikistan 
Turkmenistan 
Ukraine 
Uzbekistan 
Multi-country 
Total 1.3 
0 
3 
4.1 
0.4 
0.7 
0.7 
0 
0 
41.5 
0 
0 1 
6.2 8.08 
0.4 5.28 
6.7 1.5 
65 38.96 0 
0 
0 
1.9 
0 
3.2 
0 
2 
0 4.1 
0 
0 
0 
0 
0 
2.4 
0 
0 
16 21.1 
0 0 0 
3.6 
0 
0 
0 
0 
0 
0.6 
1 
19.5 
0 
5.4 
0 
5 2 
2.5 
0 
3 
2.3 
0 
1.7 
1.5 
0 
18 116.1 
1 0.95 1.95 
0 0 1 
15 6.9 41.58 
0 0 5.68 
3 3.5 19.7 7.4 
6.1 
3 
9 
2.7 
3.9 
4.8 
4.1 
1 
38 43.7 42.35 228.01 
Mongolia 
In Mongolia's harsh climate, the energy 
supply has an immediate impact on living 
conditions. Much of the energy-generating 
infrastructure is ageing and in need of 
replacement or refurbishment. 35 
The range of Tacis energy activities Energy solutions 
Tacis runs a wide range of energy projects. Its most 
common activities include 
. providing information on energy saving methods 
together with pilot projects which put conservation 
theory into practice 
• supporting the reorganisation of oil sector 
administration at national level; including the 
development of the laws and regulations necessary 
to encourage foreign investment in the oil industry 
assisting the modernisation of heating units at oil 
refineries 
cooperating with city authorities to evaluate the urban 
heating sub-sector 
providing know-how on prospecting and production 
in the gas sector 
providing know-how and training on the 
modernisation of energy production facilities 
supporting improvements in the functioning and 
efficiency of the power generation, transmission and 
distribution system 
introducing modern computer-based automatic 
power distribution billing and settlement systems 
fostering technology transfer for the modernisation of 
existing and new design power stations. The Tacis Programme - in conjunction with the European 
Commission's Thermie Programme - has set up a 
network of ten energy centres in the NIS. These are 
designed to help provide solutions to energy conservation 
issues affecting local industry in its partner countries. 
The centres' activities range from auditing boiler 
performance at industrial plants to launching consumer 
and legal information and environmental awareness 
campaigns. They conduct market and technology 
evaluations and organise exhibitions of energy 
technologies, workshops, training and site visits. They also 
set up contacts among equipment producers and buyers. 
Initially, the centres are staffed with experts from western 
Europe who work with local experts, training them to 
analyse and solve problems on-site. Once the western 
experts' job is complete, they hand over responsibility to 
the now fully-trained local specialists. 
EC energy buses, which operate from most energy 
centres, are the focal point of the efficiency drive. They are 
equipped with monitoring equipment and software, and 
visit major industrial zones and district heating plants to 
carry out on-the-spot audits and monitoring activities. 
Project focus 
Tacis' energy-saving initiatives in Ukraine 
Tacis evaluation teams have been working closely 
with the Ukrainian government to ensure that realistic 
solutions to the overriding problems in the country's 
energy sector can be put into practice. This process 
began with an extensive quantitative research survey 
carried out in tandem with the Ministry of Energy and 
Electrification, the State Committee of Oil and Gas, 
the State Committee of Coal, and the State 
Committee for Communal Services. 
Project findings indicate the need for establishing a 
pricing policy and set tariffs for energy use, and the 
creation of a national energy agency. This agency 
would rationalise energy use and assume overall 
responsibility for energy policy (including tariffs and 
pricing). It would also ensure that individual energy 
saving projects are implemented as part of a larger 
strategy. 
36 
Tajikistan 
Domestic political instability has prevented the initiation of 
a Partnership and Cooperation Agreement between 
Tajikistan and the European Community and its Member 
States. Relations are based for the moment on the 1989 
Trade and Cooperation Agreement with the former USSR. 
Elections in February resulted in overwhelming parliamentary 
support for the president, and negotiations throughout 1995 
made slow progress in resolving the civil war which started in 
1992. Further internal disruption has led to the removal of 
the Prime Minister and his principal deputy. 
Tajikistan was the last of the New Independent States to 
introduce its own currency in May 1995. The new Tajik 
government reiterated its commitment to progressing with 
an ambitious economic reform programme. However, 
inflation remains high, running at about 80 per cent a 
month. In 1995 Tajikistan embarked on several joint-
venture mineral mining projects with western partners. 
Tajikistan is concentrating on market reform initiatives for 
its agricultural sector, particularly in land privatisation and 
the encouragement of increased private production and 
processing systems. Attention is now concentrating on 
the different negotiations with the International Monetary 
Fund on a reform programme which would justify a loan 
under the Fund's Structural Transformation Facility. 
Encouraging reform in Tajikistan 
The 1995 Tacis budget committed ECU 4 million for the 
national programme in Tajikistan, concentrating on the 
following priority sectors 
. food production, processing and distribution 
. human resources development 
. energy. 
Tajikistan also benefited from European Community food 
aid and from humanitarian aid through ECHO. 
Improving food production 
An earlier Tacis project helped establish a policy advisory 
unit within the Ministry of Agriculture. In 1995 Tacis 
continued to assist the Ministry to identify areas which 
would immediately benefit from Tacis know-how, to 
improve the overall efficiency of the sector and increase 
Tajikistan's level of self-sufficiency. 
Tajikistan consistently produces high quality fruit and 
vegetables, but lacks a developed system for efficient 
processing and exporting. A Tacis project (ECU 1.75 million) 
supported Tajikistan's plans to develop the processing 
sector by encouraging stronger links between the 
organisations involved, and by working with individual plants to improve processing techniques and management skills. 
The project also worked at developing support services for 
newly emerging private farmers and processors. 
Providing knowledge and skills 
Tacis continued to strengthen the teaching of market 
economics and management in 1995 in the human 
resources sector - expanding and complementing 
activities undertaken in 1994. An ECU 1 million Tacis 
project supported the two training centres in Dushanbe 
and Khodzhand established in 1994. It included training 
for the trainers of these institutions and provision of know-
how for the development of tailor-made curricula and for 
course development. Tacis involvement encourages both 
centres to continue on a commercial basis following the 
completion of the project. 
Energy - developing an essential resource 
Hydro-electricy is the main source of energy in Tajikistan, 
although the country remains dependent on imports for 
its oil and gas requirements. Tacis has helped the Tajik 
energy authorities determine how best to utilise its 
available hydro-power resources and develop energy 
trade with neighbouring countries. A Tacis project worth 
ECU 950,000 contributed to the preparation of studies to 
determine the economic feasibility of completing certain 
unfinished and outdated hydro-electric plants. The project 
also examines cost and efficiency in energy supply, and 
overall awareness of energy efficiency questions. 
Funds allocated by sector each year 
1991 1992 1993 1994 1995 Total 
Nuclear 
safety and 0 0 0 0 0 0 
environment 
Restructuring state 
enterprises and private 
sector development 
Public administration 
reform, social services 
and education 0 
Agriculture 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 
Total 1. 1.75 3.43 
0.95 1.95 
0 0 
0 0 
0 0 
0 0 
0 0.32 0.3 0.62 
0 4 4 8 
Note: Tajikistan did not receive any funding 1991-1993. 
37 
Turkmenistan 
The Council of Ministers requested the Commission to 
carry out exploratory discussions with Turkmenistan, in 
view of a possible strengthening of contractual relations. 
As with Uzbekistan, the EU Presidency and the 
Commission had drawn up a report on the human rights 
situation in the country. Turkmenistan made an official 
request towards the end of 1995 to initiate negotiations 
for a Partnership and Cooperation Agreement. Meanwhile, 
Turkmenistan's priorities in 1995 continued to focus on 
maintaining economic and political stability. 
Although rich in natural resources and export potential, 
Turkmenistan lacks the know-how fully to exploit its 
advantages. Economic performance has however in some 
respects improved. Inflation decreased from 649 per cent in 
1994 to 150 per cent in 1995. Turkmenistan is still having 
difficulty in obtaining payment from its principal trading 
partners in the NIS for the natural gas which represents the 
largest portion of its exports. This has led to serious 
domestic economic problems and even to a shortage of 
grain. At present the country relies exclusively on the 
Russian network of pipelines for the export of its gas. Strengthening enterprise development 
Tacis continued to offer the Turkmen authorities high level 
policy advice on enterprise development in 1995, 
concentrating on building on the achievements of earlier 
projects. The development of and support for the small 
but thriving small and medium-sized enterprise sector 
remains a priority, as does the implementation of an 
effective large-scale privatisation strategy. In 1995, both 
Tacis and the EBRD worked to promote joint-venture 
projects in the mineral, industrial and textile sectors. 
Human resources - an untapped resource 
Recent Tacis support to human resources development in 
Turkmenistan has centred on civil servant training, 
culminating in the establishment of a public administration 
institute in 1995. Tacis know-how also assisted in the 
development of a legal and institutional framework for 
human resources management. The Tacis project (ECU 1 
million) is also helping the Turkmen authorities to develop 
the public administration system to adapt to the changing 
needs of a market economy. 
Tacis supports development 
The Tacis programme for Turkmenistan totalled ECU 
4 million in 1995, focusing on three main areas in 1995 
• food production, processing and distribution 
. enterprise restructuring and development 
. human resources development. 
Extending the agricultural sector 
Tacis concentrated on assisting the Turkmen authorities 
to develop and improve the output and efficiency of the 
meat and milk processing sector. Tacis know-how was 
essential for the development of important financial 
feasibility studies for selected plants, concentrating on the 
development of long-term economically viable investment 
projects to attract joint venture partners. The project (ECU 
930,000) also recommended privatisation strategies for 
the future. 
A second Tacis project, worth ECU 750,000, initiated an 
unprecedented review of the Turkmen fisheries industry, 
determining future investment opportunities and assessing 
fresh-water fishery development. Tacis expertise 
concentrated on ensuring that the studies were of 
international standard, thus increasing chances of gaining 
further support from international agencies or joint-venture 
investors. Funds allocated by sector each year 
1991 1992 1993 1994 1995 Total 
Nuclear 
safety and 0 0 
environment 
Restructuring state 
enterprises and private 0 0.57 
sector development 
Public administration 
reform, social services 0 1.05 
and education 
Agriculture 0.88 3.68 
Energy 0 1 
Transport 0 0 
Policy advice 0 2.5 
Telecommunications 0 0 
Humanitarian aid 0 0 
Other sectors 0 0 
Total 0.88 8.8 3.6 
0 0 
0 
0 
0 
0 
0.32 
4 3.37 
3.85 
9.84 
1 
0 
2.5 
0 
0 
1.12 
21.68 
Note: Turkmenistan did not receive funds under the 1993 budget. 
38 
Ukraine 
The reform policy implemented by the Government 
produced significant results in 1995. However, while the 
need for reform is widely understood, the decline in living 
standards weakens the support for the difficult decisions 
which are necessary to implement the Government's 
programme. Nevertheless the policy implemented by the 
President has contributed to the rise in Ukraine's 
international standing in 1995. 
During his visit to the European Commission in Brussels in 
June 1995, the Ukrainian President reiterated his support 
for closer links with the European Community and for the 
continuation of the reform process. He emphasised that a 
strong economy is vital for Ukraine's economic 
independence. 
The operation of the Tacis Programme in Ukraine 
continued with notable achievements in 1995, particularly 
in energy sector reform and enterprise restructuring. 1995 
also saw the decision by Ukraine to close the Chernobyl 
power plant, and the signature by the G7 and Ukraine of a 
Memorandum of Understanding, with a commitment by 
the G7 members to support this closure. 
The recent establishment of a Tacis section in the 
European Commission Delegation in Kiev is leading to 
closer and more effective interaction and communication 
between Tacis and its partners in Ukraine. 
Interim Agreement signed 
The Partnership and Cooperation Agreement signed in 
March 1994 was still in the process of being ratified in 
1995. Political and economic dialogue is in place, with bi­
annual ministerial meetings, and Tacis is helping Ukraine in 
the adaptation of its legislation to the standards of the 
PCA. Much still has to be achieved in the fields of non­
discrimination against foreign companies, market access 
for foreign products, and access for foreign investments. 
The Interim Agreement was signed in June 1995. It was 
given the positive opinion of the European Parliament in 
October 1995 and gave effect to the trade aspects of the 
Partnership and Cooperation Agreement. 
As part of the Agreement, the European Community-
Ukraine Joint Committee met in Brussels in March 1995 
and developed 'a close and structured dialogue' 
concerning trade and economic relations. Ukraine's accession to the Council of Europe was also 
seen as a clear indication of its long-term commitment to 
closer political relations with the European Union. 
Tacis - strengthening reform initiatives 
Tacis supported Ukraine's reform efforts in 1995 by 
focusing on the following sectors 
• energy 
• enterprise restructuring and development 
• nuclear safety and the environment 
• human resources development 
• food production, processing and distribution. 
The Tacis budget for the national programme for Ukraine 
in 1995 totalled ECU 72.5 million, including ECU 35 million 
for the national programme and ECU 37.5 million as the 
Tacis contribution to the EU/G7 Action Plan for Ukraine's 
energy sector. Ukraine also benefited from ECU 18 million 
of Tacis multi-country funds in the nuclear sector, and 
from other multi-country funds covering policy and legal 
advice, democracy projects, and cooperation in statistics 
and customs. 
Energy - central to the Ukrainian challenge 
The long-term economic prosperity of Ukraine depends 
on substantial reform of this sector. The high cost of 
energy imports continues to weigh heavily on Ukraine's 
balance of payments and budget deficit. 
Many energy sector reform plans were initiated in 1994 
with considerable involvement by Tacis, and its interest in 
this sector continued in 1995. In close cooperation with 
the Ukrainian administration, four priority areas were 
identified for Tacis action in 1995: assistance to national 
energy-saving institutions and actions, support to the oil 
and gas sub-sector, assistance in creating a unified 
Ministry of Fuel and Energy, and assistance in the 
rehabilitation of the Trypolye power station with an 
economic analysis of modern combustion technologies. 
Tacis-funded studies completed in 1994 had already 
reviewed the demand and supply situation in Ukraine. 
Based on the conclusions of these studies, progress is 
being made in the identification and dismantling of 
inefficient monopolies. In addition, inefficient production 
techniques have gradually been replaced by more 
sophisticated production methods. 
39 
An ongoing priority is to ensure that the Ukrainian 
administration adopts an energy pricing policy that reflects 
the true cost of supplies and promotes energy saving. Gas 
metering projects for domestic and industrial users were 
initiated in the later part of 1995 and will continue in 1996. 
It is intended that industrial and domestic users should 
start to pay for their real energy consumption. Only by 
doing this will the overall demand and supply situation 
improve. 
Steps have also been taken to reduce the numbers of 
unpaid gas bills. Until January 1996 outstanding 
payments were met by Government subsidies, which only 
added to the pressure on the state budget. With 
government subsidies for energy payments ending as of 
January 1996, companies will no longer receive energy 
credits until they have paid all outstanding bills. 
The success of energy sector reform has however added 
to the problems faced by domestic users and small 
businesses unable to pay for the additional costs incurred. 
These problems are set to increase as government 
subsidies come to an end. Ukraine will focus on the 
development of fuel and energy systems in the future, 
aiming at introducing energy saving technologies for all 
users. 
Enterprise restructuring and privatisation 
Enterprise restructuring and development remains a 
priority for Ukraine. Many actions in this sector were 
agreed or initiated in 1994, although their progress in 
1995 was marred by continuing problems concerning the 
mass privatisation programme. 
Tacis continued its support for the State Property Fund 
with an extended ECU 1 million grant in addition to 1994's 
ECU 3 million allocation. Tacis is also assisting the 
development of pilot share registries and is advising on 
techniques for streamlining procedures. However, despite 
much of the infrastructure for effective privatisation being 
in place, improvements are needed if established targets 
are to be met. Economic restructuring proves difficult to 
implement - transformation of industry through 
privatisation is not matched by reform of public 
administration and training. 
International donors have requested the Ukrainian 
administration to redesign the privatisation process so that 
the pace of privatisation improves, the number of shares 
increases, and the confusion over unclear procedures is reduced. Coordination meetings between international 
donors, instituted and hosted by Tacis, USAID and the 
World Bank, illustrate the commitment to establishing an 
effective and internationally accepted privatisation system. 
It is hoped that further Tacis action will focus on the 
redesign of the privatisation process. Working groups 
have been established by Tacis to address the most 
urgent problems. 
Tacis support to the small and medium-sized enterprise 
sector continued in 1995 with real success. In both Kiev 
and Zaporozhye, SME Development Agencies and 
Business Communication Centres have been established, 
providing seminars and training consultancy. A network of 
Post-Privatisation Support Centres is being developed, 
providing much needed support to recently privatised 
enterprises. The Kiev centre has been operational for 
some months, and will be joined by centres in Lugansk 
and Zaporozhye in 1996. Additional centres are planned 
as a result of achievements in 1995. 
Improving nuclear safety and protecting the 
environment 
Nuclear safety and environmental projects remain an 
important priority for Ukraine, and the largest proportion of 
Tacis funding for Ukraine is allocated to this sector. 
The decision to close the Chernobyl nuclear power plant 
by the year 2000 was taken in April 1995 by the 
governments of Ukraine, the G7 countries and the 
European Commission. 
Ukraine faced problems securing international support for 
helping with this closure project. However, Tacis helped 
find solutions for the development of new technical 
processes for dealing with nuclear waste, although the 
project is further complicated by the difficulty in 
determining just how much the project will cost until the 
relevant feasibility studies are completed. One Tacis 
project, worth ECU 1.5 million, played an important role in 
devising a decommissioning strategy. Meanwhile the 
sarcophagus feasibility study focused on proposing 
techniques for dealing with the remaining damaged units. 
In December 1995 Ukraine signed a Memorandum of 
Understanding with the members of the G7 and the 
European Commission, which pledged long term support 
for funding the project. (See also 'Multi-country 
programmes' section). 
40 
Agriculture - an ongoing priority 
Supporting the ailing agricultural sector is becoming an 
increasingly important priority for Ukraine. Since 1991 
more than ECU 35 million have been spent by Tacis in the 
food and agriculture sector. However, at a political level 
the formulation and implementation of an agricultural 
policy is still at a comparatively early stage, although Tacis 
projects have been praised by the President for their 
quality and output. 
The volume of agricultural output has continued to 
decrease. In all, average family expenditure on basic 
foodstuffs is more than half the monthly income. Now 
unable to depend on government subsidies, many farms 
are on the brink of collapse. There are continued 
uncertainties about land titles, there remains little security 
in market transactions, and institutional frameworks are 
ineffective. Even by the end of 1995, there was no 
consensus as to how to privatise this sector. 
Tacis therefore supported the drafting of a land 
registration system, intended to establish regulations 
governing the transfer of land from state to private 
ownership. This will help to improve the likeliness of 
privatisation in the agricultural sector. Tacis also helped 
improve storage techniques for grain. 
Human resources 
In 1995 a major project commenced to support the 
retraining and reemployment of military officers, designed 
to develop management training courses for officers and 
to promote their reintegration into active economic life. 
Another project was developed to assist the reform of the 
social protection system, while Tacis continues to support 
the evolution of public employment services and active 
labour market measures. 
Banking and finance - developing skills 
Most of Tacis' support to Ukraine's banking sector has 
been in the provision of training. The Tacis European 
Banking Advisory Service has been an important tool for 
providing support to selected commercial banks. 
Individual training programmes have also been developed 
for Bank Ukraina and the Oschadny Bank. Tacis has also 
established a bank training school, and an insurance 
training school. 
It has also been working with banks participating in the 
European Bank for Reconstruction and Development Line 
of Credit scheme. The project concentrates on giving advice to banks' credit departments. Tacis' involvement 
has greatly improved the long-term effectiveness of this 
scheme. 
Bistro programme 
The Bistro programme, designed for the quick 
implementation of small projects with a brief life span, was 
launched in Ukraine in 1995. The average contract 
amount in 1995 was ECU 58,000. Managed by the Tacis 
section of the Delegation of the European Commission in 
Kiev, Bistro projects cover all the priority sectors of the 
Indicative Programme. Support is also given to improve 
investment and trade conditions. 
Relations with other donors 
There are many international organisations working with 
the Ukrainian administration in their efforts to restructure 
the economy. In 1995 Tacis played a central role in 
coordinating the international response to Ukraine's ailing 
privatisation programme and participated in the working 
groups established to answer the most urgent problems. 
In addition, it provided ECU 37.5 million for the EU/G7 
Action Plan for the Ukrainian energy sector. 
In December 1995, the International Monetary Fund 
suspended the Standby Arrangement for Ukraine because 
a number of performance criteria had not been met. 
Continued financial support from the European 
Community and its Member States is dependent on 
Ukraine retaining International Monetary Fund support. 
Funds allocated by sector each year 
Nuclear 
safety and 3.54 
environment 1991 1992 1993 1994 
0 0 20.5 1995 Total 
37.5 61.54 
Restructuring state 
enterprises and private 
sector development 1.7 16.8 12.36 4.3 10.7 45.I 
Public administration 
reform, social services 4.65 
and education 7.36 
Agriculture 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 7.67 12.31 10.54 
6.2 8.08 5.4 
4.89 7.26 3.22 
0 0 0 
0 0.83 0.55 
0 0 0 
0 0 3.82 
Total 28.65 48.28 43.25 5 
15 
0 
0 
0 
0 
1.7 
50.5 7 26.01 
4 39.52 
6.9 41.58 
15.37 
0 0 
0 1.38 
0 0 
6.4 11.92 
72.5 243.18 
41 
Uzbekistan 
Relations between the European Community and 
Uzbekistan are based on the 1989 Trade and 
Cooperation Agreement with the former USSR. In 1995 
Uzbekistan requested the opening of negotiations for a 
Partnership and Cooperation Agreement with the 
European Community and its Member States. 
Consequently, a first Joint Committee meeting between 
the Uzbek authorities and the European Commission was 
held in May and exploratory discussions for an Agreement 
were held in July in Tashkent. These centred on the 
situation in Uzbekistan regarding human rights and 
democratic reform. As with other partners, these are 
among the essential principles which underpin the PCAs. 
During the talks Uzbekistan agreed to accept know-how 
through Tacis in these areas, which has opened the door 
to the initiation of PCA negotiations in 1996. 
Uzbekistan has benefited from high world prices for its 
principal export item, raw cotton. This has enabled it to 
achieve a trade surplus for the second year running. Gold, 
uranium and other minerals are also exported. 
Uzbekistan's abundance in mineral resources (oil, gas and 
coal) has made it almost self-sufficient in the energy 
sector. The government's tight budgetary and monetary 
policies have led to a substantial reduction in the budget 
deficit and a fall in inflation of more than 500 per cent 
compared to 1994. 
In 1995 the government accelerated the reform 
programme with the introduction of a plan demanding a 
major increase in privatisation. However, the economy is 
still constrained by high unemployment and a lack of 
foreign investment. 
Tacis focus on modernisation 
Tacis supported the Government in its reform efforts by 
focusing on the following sectors 
. human resources development 
• enterprise restructuring and development 
. food production, processing and distribution. In 1995 Uzbekistan received ECU 10 million from the 
Tacis budget for the national programme and also 
benefited from Tacis multi-country programme funds. 
Training for future managers 
One of the main problems in Uzbekistan is the lack of 
well-trained business professionals. The ongoing 
privatisation of industry and farmland requires future 
entrepreneurs to broaden their skills base and develop 
business techniques. In 1995, Tacis complemented its 
1993 management training project in Tashkent with two 
projects in Ferghana Valley and Samarkand Oblast.The 
objectives of the two projects, each committing ECU 1 
million, is to train teachers at the Ferghana State University 
and the State University of Samarkand in modern 
management and language skills. Among other things, the 
project includes English language courses, market 
economics and management, improvement of teaching 
programmes and materials, and advice to the faculties on 
how best to manage and organise curricula. 
An important project worth ECU 2 million is now starting, 
in association with the State Committee for Forecasting 
and Statistics, the Ministry of Higher and Special 
Secondary Education, and the Ministry of Labour. The 
project aims to implement a labour statistics system of 
international standard, and to develop labour market 
oriented training programmes for the unemployed and 
school leavers. 
Preparing for private enterprise 
The rapid development of new legislation and regulations 
necessitates the retraining of personnel in a variety of 
sectors. Tacis launched an ECU 1 million project with the 
Association of Accountants and Auditors to train 
personnel from private enterprises and the civil service. 
The project trains auditors in the latest methodology 
necessary for the new civil and business environment. 
Tacis also supported Goskommimuchestvo, the national 
authority responsible for privatisation, with ECU 1 million. 
42 
Support for agricultural training 
The agricultural sector is key to the Uzbek economy -
employing 30 per cent of the population and producing 43 
per cent of the net product. The emerging private 
agricultural sector requires trained personnel with modern 
practical and commercial skills. The current educational 
system does not provide for adequate training in these 
skills. 
To tackle this problem, an ECU 2.2 million project was 
initiated with the Tashkent State Agrarian University. The 
project's main aims are to train the trainers of the students 
at the University in a variety of subject areas, and to 
design and develop curricula and syllabi and produce the 
necessary teaching materials. An important aspect of the 
training is the emphasis which is being put on awareness 
of the effect that agricultural methods have on the 
environment. The project complements the Tacis advisory 
and training activities in the Ferghana and Syrdaria areas 
and will function as a pilot for additional agricultural training 
institutes. 
Protecting the Aral Sea area 
As a result of the overuse of water supplies feeding the 
Aral Sea, the area around the Sea is experiencing 
disastrous environmental consequences. An interstate 
council of the five regional states was set up to address 
the ecological problem through an action plan. project is a joint endeavour with the World Bank, which 
encompasses some 18 projects. In 1995, seven sub-
projects were started in a number of areas, including 
studies of land and water resource use, crop irrigation 
systems, water management strategies as well as 
technical support concerning issues such as clean water, 
sanitation and health, and cost analyses. 
Funds allocated by sector each year 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 
Public administration 
reform, social services 
and education 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 
Total 1991 1992 1993 1994 1995 Total 
0 0 0 0 0 0 
0 2.26 
0 3.51 
Agriculture 
Energy 
Transport 0.29 1.03 3.05 
0.4 5.28 0 3.35 
0 6.8 
0 3.35 
0 0 2 7.61 
4 14.31 
1.72 18.78 0 
0 
0 
0 
1.5 
15 2.2 
0 
0 
0 
0 
0 
1.8 
10 9.63 
5.68 
1.97 
3 
0 
0 
3.3 
45.5 
Tacis has contributed ECU 4.75 million of multi-country 
funds to an international fund which manages the financial 
contributions for environmental projects. The Water 
Resources Management and Agricultural Production Note: Uzbekistan did not receive funds under the 1993 budget. 
43 
i-country programmes 
Tacis has set up a number of multi-country programmes 
to enhance cooperation between the partner countries 
and to address problems that are common to all New 
Independent States. In multi-country programmes, either 
the solution to the problem is the same for each country, 
or groups of countries have to work together to achieve a 
significant impact. 
The 1995 Tacis multi-country programme, worth a total of 
ECU 144.5 million, concentrated on the areas of nuclear 
safety, food aid, the environment and the building of 
networks. It also included support for the International 
Science and Technology Centre, ISTC (covered 
separately in the Russia country section), and for a 
number of framework programmes such as the Tacis 
Democracy programme. 
Some major multi-country programmes are outlined 
below. 
Nuclear safety programme 
Tacis allocated a sum of ECU 58.5 million for its nuclear 
safety programme in 1995. The programme aims to 
improve the safety of operating nuclear power plants and 
civilian nuclear fuel and waste management activities, to 
promote regional cooperation on nuclear safety in 
countries operating Soviet-built nuclear reactors, and to 
strengthen regulatory frameworks. 
In addition to the ECU 58.5 million which was allocated by 
the European Commission to nuclear safety in 1995, ECU 
37.5 million (from a total of ECU 100 million over 1994-
1996) was also committed to the EU/G7 Action Plan for 
Ukraine's energy sector. 
Memoranda of Understanding concerning the 
implementation of aspects of the nuclear safety 
programme were signed between the European 
Commission and Russia in February 1995, and between 
the Commission and Ukraine in October 1995. The 
Memoranda include nuclear indemnity statements, 
freeing Tacis contractors from the potential legal 
consequences of a nuclear incident. Since the start of the 
nuclear safety programme, Tacis experts have been 
reluctant to deliver equipment and important studies 
before a satisfactory legal framework was in place. 
Following the signing of the agreements, many of the 
projects can now go ahead. On-site assistance 
A large percentage of Tacis funding under the nuclear 
safety programme is allocated for on-site operational 
assistance. An important mechanism used to achieve this 
is the development of partnerships between western 
operating companies and New Independent States 
plants. Through careful pairing, western operating plants 
provide specific technical assistance such as advice in the 
preparation of technical specifications when purchasing 
new safety equipment, advice on organisation and 
procedures, and on-the-job training. Tacis experts have 
been providing technical and operational advice to the 
following plants: Smolensk, Balakovo, Sosnovy Bor, Kola, 
Kalinin, Beloyarsk (in Russia), and Rovno, South-Ukraine 
and Zaporyzhe (in Ukraine). 
A number of equipment supply contracts were signed in 
1995. Other aspects of the scheme include visits by 
eastern experts to plants in the European Community, 
support for joint-ventures and the identification, 
procurement and supply of spare parts. 
Design safety studies 
Studies are the main instrument used to identify important 
safety related issues which need attention. In 1995, efforts 
continued to be directed at solving problems caused by 
design deficiencies in WER and RBMK model reactors as 
well as fuel cycle operations and waste treatment. 
Ukraine: the EU/G7 Action Plan 
In December 1995, a Memorandum of Understanding 
was signed by Ukraine, the G7 and the European 
Commission, which outlined a comprehensive approach 
to Ukraine's energy sector, including the closure of the 
Chernobyl nuclear power plant by the year 2000. 
Tacis assisted with the preparations for closure of the 
plant. In July 1995, the sarcophagus feasibility study 
commissioned in 1994 was completed. The study 
designed a method for enclosing Unit 4, the remaining 
damaged unit of the plant. Another Tacis project assisted 
in the development of a decommissioning strategy. Under 
the 1995 programme, Tacis is supporting the creation of a 
solid waste retrieval facility and a solid waste processing 
plant. These two plants will provide the necessary facilities 
for the clean-up of solid nuclear waste arising from the 
decommissioning of Chernobyl Units 1 -3. 
44 
Health and social issues related to the Chernobyl accident 
in 1986 have also warranted Tacis involvement. In addition 
to some medical assistance and equipment, Tacis is also 
involved with the United States and Ukraine in the 
definition of an action plan to cope with the social 
consequences of the Chernobyl closure. 
Part of the EU/G7 Action Plan for Ukraine's energy sector 
is geared to ensuring that Ukraine will have sufficient 
energy sources following the closure of Chernobyl. In 
accordance with the plan, part of the funds were allocated 
to the ongoing preparatory work on the Rovno and 
Khmelnitsky nuclear power plants. Engineering support is 
being provided so that the plants may be safely 
completed. 
With energy shortages a major concern for Ukraine, the 
EU/G7 Action Plan is actively encouraging energy 
conservation through the development of a national 
energy saving programme, the establishment of a training 
centre, and the organisation of practical demonstrations to 
industry on the topic of energy efficiency. 
Advising the safety regulators 
In Russia and Ukraine, Tacis launched a three year plan in 
1994 to transfer the methodology and practices of nuclear 
safety to their partners. Experts from safety authorities in 
the European Community continue to support the 
regulatory bodies through advice concerning surveillance, 
inspections and licensing of plants, drafting and 
implementation of regulations, and training. After a slow 
start-up period, effective cooperation is now progressing 
well between the authorities. Tacis also continued to 
provide technical safety equipment to these authorities. 
Environment 
The environment was a priority area for the 1995 
programme and resources were substantially increased to 
ECU 12 million. 
The broad objective of the 1995 Tacis environment 
programme was to support the development capacity of 
the New Independent States to address their 
environmental problems collectively. Tacis is assisting the New Independent States to bridge 
the gap between the requirements for environmental 
action and the current capacities of national and inter­
state bodies to develop feasible environmental strategies 
and policy instruments. 
In 1995, the Tacis environment programme has focused 
on the following objectives 
. to speed up the formulation of effective national 
environmental strategies 
. to raise awareness and to provide environmental 
information 
. to progress the Tacis Inland Seas programme 
(development of an interstate institutional capacity to 
address the unique environmental issues of the 
Caspian Sea, and continuation of the activities in the 
Aral and Black Seas launched under the 1992 and 
1993 programmes). 
In comparison with other Tacis sectors, the environment 
programme is characterised by a high level of activity at a 
multi-country level by international donors. Examples are 
the common approach on nuclear safety and the 
collaborative projects for the Black Sea and Aral Sea, 
which involve several major donors. Tacis has responded 
to this multilateral approach, building formal arrangements 
which allow cofinancing of actions wherever possible. 
Coordination of food aid initiatives 
1995 was the second year that Tacis played an important 
role in the coordination and operation of the European 
Community's food aid operations in the three Caucasian 
republics, Kyrgyzstan and Tajikistan. Tacis contributed to 
the overall food aid budget by providing funds for its 
management and operation, and by helping partner 
countries in the use of funds received from the sale of the 
food supplies. It did this in close cooperation with other 
international donors. 
There have been two main food aid operations: one worth 
ECU 204 million which covered the winter period of 1994-
1995; another worth ECU 197 million, covering the winter 
period 1995-1996. In addition to providing short-term 
alleviation of basic food deficits, the food aid operations 
are intended to build the foundations for long-term 
solutions to food production. 
45 
Unlike humanitarian aid where target groups are directly 
supplied with basic foodstuffs, food aid products are 
supplied free of charge from the European Community 
and sold in the partner countries at local prices previously 
agreed with the partner government. This price takes into 
consideration equivalent local costs and production 
methods. The revenue raised from the local sale of this 
food is used for the creation of 'counterpart funds'. The 
value of the counterpart funds remains in the local 
currency and is used by the partner country for social or 
agricultural initiatives. 
Counterpart funds 
The uses for counterpart funds are agreed with partner 
governments, in line with the primary needs of the partner 
country. The counterpart funds are only derived 
approximately two months after the food supplies are 
delivered. Therefore funds from the 1994 operation were 
made available in early 1995. These funds were primarily 
used for social projects in such areas as pensions 
contributions, family allowances and health care. In the 
case of Armenia and Georgia counterpart funds made up 
a significant part of these countries' national budgets. 
The 1995 funds, available in 1996, will be used to support 
agricultural projects and to encourage self-sufficiency in 
food production in the Caucasus, Kyrgyzstan and 
Tajikistan. 
Food aid budgets 
As the transfer of know-how is increasingly needed in 
order to assist governments with the use of counterpart 
funds, Tacis' contribution has increased from ECU 4 
million in 1994 to ECU 17 million in 1995. 
The overall 1995 budget comprised funds from the 
European Agriculture Guidance and Guarantee Fund, the 
Directorate General for Development (DG VIII), ECHO 
(European Community Humanitarian Office) and Tacis. 
Transport Corridor Europe Central Asia 
(Traceca) 
The Tacis Traceca programme is directed at building a 
transport corridor from Central Asia across the Caspian 
Sea, through the Caucasus to Europe. It covers all sectors 
from road, rail and maritime transport to trade. The 1995 
Tacis budget for Traceca was ECU 2.5 million, with a total 
of ECU 18 million committed since 1992. The initial implementation of the programme was slow, 
largely due to the political and military conflict in the 
region. However, in 1995 the implementation of the 
programme progressed significantly. In May 1995, a 
Traceca project management team brought together 
experts from eight Traceca states in Almaty to agree 
priorities and coordinate further actions. Greater emphasis 
was placed on trade facilitation aspects of the programme 
rather than only on the establishment of a transport 
infrastructure corridor. 
Working groups were established which discussed issues 
such as legal and regulatory harmonisation, regional traffic 
forecasting models, simplification of customs procedures, 
feasibility studies for line upgrading and port management 
improvement. Projects launched in 1995 included the 
initiation of a feasibility study on the joint venture of the 
trans-Caucasian railway. 
Tacis Tempus programme 
This programme, a cooperation scheme aiming to 
develop and restructure higher education institutions in the 
New Independent States, received a total of ECU 23 
million in 1995, part of a total commitment of ECU 48.45 
million from 1993 to 1995. The programme is based on 
networking of universities from the European Community 
and the New Independent States. In 1995 Armenia, 
Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, 
Moldova, Mongolia, Russia, Ukraine and Uzbekistan 
participated in Tacis Tempus. 
The main instruments of the programme are Joint 
European Projects. In these projects, higher education 
institutions from two or three different European 
Community countries cooperate with one university or 
teacher-training institution from the NIS to enable the latter 
to adapt its curricula, teaching methods and degrees to 
the challenges of democracy and the market economy. 
Funding is spent on communication equipment, 
textbooks, teaching assignments and mobility. In 1995, 
59 full-scale and 87 preparatory projects were funded. 
The main areas of cooperation are: economics, political 
science, European language teaching, social studies, 
history and university management. 
46 
Tacis Democracy programme 
The Tacis Democracy programme has been working on 
strengthening the pluralist society and the rule of law in the 
New Independent States since 1992. It supports the 
overall process of political and economic reform and gives 
concrete support to the democratic structures required by 
the Partnership and Cooperation Agreements. In 1995, it 
focused on continued political reform in the New 
Independent States, with emphasis on multi-party 
elections and the establishment of new institutions. It also 
worked on the introduction of new procedures and 
practices in many sections of government, and the 
analysis of legal systems, political parties and trade 
unions. 
In 1995, the programme received a budget of ECU 10 
million and concentrated on the 
. transfer of know-how and techniques of 
parliamentary practice and organisation, to multi­
party groups of parliamentarians and politicians 
. strengthening of non-governmental organisations 
and associations 
. transfer of expertise and skills to professional groups 
and associations, concerning democratic practices 
and the rule of law. 
Monitoring of elections 
In 1995 the Tacis Democracy programme monitored 
media coverage of elections in Belarus, Armenia, Georgia, 
Azerbaijan and Russia, through the European Institute for 
Media. 
In Russia, the Democracy programme assisted in and 
coordinated the work of all European organisations 
(Organisation for Security and Cooperation in Europe, 
European Parliament, Council of Europe, Member States) 
involved in monitoring the Russian elections. It set up a 
European Union Election Unit with six experts to facilitate 
cooperation between the institutions and to cover different 
areas such as the legal aspects, voting and counting 
methods, observers deployment and statistics. (See also 
'Russia' section.) Joint programme for Ukraine 
In November, the Commission signed an agreement with 
the Council of Europe to finance a joint programme for 
Ukraine (ECU 420,000). The programme aims at activities 
concerning legal systems, local government reform and 
the transformation of the Ukrainian law enforcement 
system, and furthers Ukraine's capacity to comply with 
the membership conditions set out by the Council of 
Europe. 
Training for Ukrainian parliamentarians 
The project aims at training deputies of the Ukrainian 
Parliament in parliamentary techniques, and initiates 
permanent cooperation with the Parliaments of France, 
Germany, United Kingdom, Belgium and the European 
Parliament. The project started in December 1995 and will 
run for one year, organising training placements for 170 
Ukrainian deputies in the above countries. 
Funds allocated by sector each year 
Nuclear 
safety and 
environment 
Restructuring state 
enterprises and private 
sector development 
Public administration 
reform, social services 
and education 
Agriculture 
Energy 
Transport 
Policy advice 
Telecommunications 
Humanitarian aid 
Other sectors 
Total 1991 1992 1993 1994 1995 Total 
36.27 
7.6 
44.85 
5.79 
6.7 
4.78 
0 
0 
0 3.8 
1.5 
9 
8.5 
1 
0 
0 0.83 
105.99 108.63 100 67.5 70.5 354.27 
15 
21 
0 
5 
14 20 
2 
3 
7 
8 20.5 
1 0 
0 0 
8 16.5 0 31.6 
23 108.85 
10.5 
3.5 
8.5 
0 
2.5 
0 
26 
172 141.5 144.5 22.09 
19.7 
43.28 
37 
4.5 
0 
51.33 
672.62 
47 
Future outlook 
Tacis recognises that it operates in a rapidly evolving 
environment, with the consequent need for it to be a 
flexible and fluid instrument if it is to have maximum effect 
in its partner countries. 
This Annual Report has highlighted a number of Tacis 
activities in 1995 which have prepared the ground for 
significant future developments in the Programme, 
demonstrating the Commission's approach to the 
challenge. Three new directions are of particular 
importance: 
. the investment support clause in the new Tacis 
Regulation 
• the cross-border cooperation clause in the new Tacis 
Regulation 
• the preparation of an overall evaluation of the Tacis 
Programme 
Investment support 
With the adoption of the new Regulation, Tacis will 
broaden its activities from providing know-how and 
expertise to include investment support, both for EU-NIS 
joint ventures between small and medium-sized 
enterprises, and for small-scale infrastructure projects at 
border areas. In so doing, it is following the Phare 
Programme for the countries of central and eastern 
Europe, in acknowledging the need to build upon the 
current provision of know-how by providing or attracting 
investment to maintain the momentum of economic 
development. 
The new Regulation allows for up to 10 per cent of Tacis 
funds to be spent in this way. The Programme is 
committed to working closely with other donors who are 
investing directly in the NIS, such as the EBRD, the World 
Bank, the US and the individual Member States. Tacis will 
also continue to prepare the ground for investment by 
carrying out prefeasibility and feasibility studies to establish 
the worthiness of investment projects which can then be 
funded by other donors, and by providing support so that 
projects are able to meet the necessary investment 
criteria. Cross-border cooperation 
With the accession of Finland in January 1995, the 
European Community acquired its first common border 
with a Tacis country. This Finnish-Russian border, from 
the Gulf of Finland almost to the shores of the Barents 
Sea, is some 1,000 kilometres long. 
Border areas are of great significance in furthering 
communication and trade, and the new Tacis Regulation 
opens the way for cross-border cooperation at the 
Finnish-Russian border, at the borders shared by Tacis 
partner countries and the Baltic States, Poland, Slovakia, 
Hungary and Romania, and at borders between Tacis 
partner countries themselves. 
A separate budget line has been created for this cross-
border cooperation, which will focus both on small-scale 
infrastructural projects and the continued transfer of 
know-how. Emphasis will be placed on environmental 
protection measures, while Tacis will also build border 
crossing facilities, help to reduce traffic and customs 
bottlenecks, and train border personnel. Where possible 
this will proceed alongside the existing Phare cross-border 
cooperation programme, and the EC's INTERREG 
programme to develop its external border areas in Finland. 
Programme evaluation 
For 1996, drawing on the legacy of its first five years of 
existence, Tacis management plans to launch an overall 
evaluation of the Programme. This will go ahead 
separately from the extensive monitoring and evaluation 
programme - focussing on individual projects and 
framework programmes - which is already under way. 
Independent evaluators will look at all aspects of Tacis in 
its entirety, from the management, staffing and logistics in 
Brussels and in the partner countries, through to the 
political and economic impact of the Programme. This 
evaluation, which was prepared in 1995 and should be 
completed by the end of 1996, will make a major 
contribution to the ongoing assessment of Tacis priorities, 
funding and management. 
48 
Tacis funds allocated by sector 
Nuclear safety and environment 
Funds committed by country each year 
1991 1992 1993 1994 1995 Total 
Armenia 0.3 
Kazakhstan 0 
Russia 12.89 
Ukraine 3.54 
MCP Kazakhstan 0 
MCP Russia 32.61 
MCP Ukraine 3.66 
MCP Regional 0 
Total 53 0 0 0.3 
0 0 0 
0 0 12.89 
0 20.5 37.5 61.54 
0 0 2.5 2.5 
38 48.5 41 38 198.11 
22 30.5 24.5 18 98.66 
20 21 2 12 55 
80 100 88 108 429 
Note: MCP - multi-country programmes 
Public administration reform, social services 
and education 
Funds committed by country each year Restructuring state enterprises and private 
sector development 
Funds committed by country each year 
1991 1992 1993 1994 1995 
Armenia 
Azerbaijan 
Baltic States 0 1.5 
0 3 
0 0 
Belarus 0.68 1 
Georgia 1.18 1.25 
Kazakhstan 4.87 
Kyrgyzstan 0 
Moldova 0.13 
Mongolia 0 1.4 3.15 
2.6 
0 
0 0 
1.8 
0 
0 
1.8 
1.8 
0 
1.9 
3.8 1.5 
1.3 
0 
0 
1.3 
2.9 
1.6 
2 
0 Total 
4.8 
6.1 
0 
1.68 
5.53 
14.12 
4.2 
6.03 
3.8 
Russia 46.64 24.57 
Tajikistan 0 0 
Turkmenistan 0 1.05 
Ukraine 4.65 3 
Uzbekistan 0 3.51 
Multi-country programmes 44.85 0 44 18.85 52.8 1f 
0 
0 
7.36 
0 
21 1 
1.8 
4 
6.8 
20 
Total 103 42.28 79.91 63.55 99.4 2 
3.85 
26.01 
14.31 
108.85 
388.14 1991 1992 1993 
Armenia 0.7 3.54 2.3 
Azerbaijan 0 2.6 0 
Baltic States 0 0 0 
Belarus 0.3 7.52 4 
Georgia 0 3.5 0 
Kazakhstan 0 6.54 6.3 
Kyrgyzstan 0 0.82 0 
Moldova 0 1.73 0 
Mongolia 0 0 0 
Russia 27.2 29.76 54.5 
Tajikistan 0 0 0 
Turkmenistan 0 0.57 0 
Ukraine 1.7 16.8 12.36 
Uzbekistan 0 2.26 0 
Multi-country programmes 7.6 4 15 
Total 37.5 79.64 94.46 1994 
0 
1.9 
0 
5 
3.6 
6.3 
0 
1.45 
2.56 
43.4 
0 
1.8 
4.3 
3.35 
5 
78.66 1995 Total 
2 8.54 
1.8 6.3 
0 0 
5 21.82 
1.9 9 
5.9 25.04 
0 0.82 
1.5 4.68 
0 2.56 
40.6 195.46 
0 0 
1 3.37 
10.7 45.86 
2 7.61 
0 31.6 
72.4 362.66 
49 
Agriculture 
Funds committed by country each year Transport 
Funds committed by country each year 
1991 1992 1993 1994 1995 Total 
Armenia 0 1.66 0 0 0 1.66 
Azerbaijan 0.4 2.5 0 0 0 2.9 
Baltic States 5.95 0 0 0 0 5.95 
Belarus 1.6 2.51 2 0 2 8.11 
Georgia 2.65 1.5 0 1.8 0 5.95 
Kazakhstan 2.16 3.06 3.15 3.15 3 14.52 
Kyrgyzstan 0 2.71 4 0 3.7 10.41 
Moldova 0.97 2.27 0 4.7 2.5 10.44 
Mongolia 0 0 0 0 0 0 
Russia 50.85 21.49 12.5 16.3 17 118.14 
Tajikistan 0 0 0 1.68 1.75 3.43 
Turkmenistan 0.88 3.68 0 3.6 1.68 9.84 
Ukraine 7.67 12.31 10.54 5 4 39.52 
Uzbekistan 1.03 3.05 0 3.35 2.2 9.63 
Multi-country programmes 5.79 3.8 0 2 10.5 22.09 
Total 79.95 60.54 32.19 41.58 48.33 262.59 Armenia 
Azerbaijan 0 
Baltic States 4 
Belarus 2.24 
Georgia 0.73 
Kazakhstan 0 
Kyrgyzstan 0 
Moldova 0 
Mongolia 0 1991 1992 1993 1994 1995 Total 
0 0 0 0 0 0 
0 
0 
1.3 
0 
0 
0 
0.6 
0 0 0 
0 4 
0 6.54 
0 0.73 
0 0 
0 0 
0 0.6 
0 0 
Russia 32.87 14.25 13.55 13.9 12.6 87.17 
Tajikistan 0 0 0 0 0 0 
Turkmenistan 0 0 0 0 0 0 
Ukraine 4.89 7.26 3.22 0 0 15.37 
Uzbekistan 0.29 1.68 0 0 0 1.97 
Multi-country programmes 4.78 9 14 7 8.5 43.28 
Total 49.8 33.19 32.77 22.8 21.1 159.66 
Energy 
Funds committed by country each year Policy advice 
Funds committed by country each year 
1991 1992 1993 1994 1995 Total 1991 1992 1993 1994 1995 
Armenia 1.3 
Azerbaijan 0 
Baltic States 3 
Belarus 4.1 
Georgia 0.4 
Kazakhstan 0.7 
Kyrgyzstan 0.7 
Moldova 0 
Mongolia 0 
Russia 41.5 
Tajikistan 0 0 
Turkmenistan 0 1 
Ukraine 6.2 8.08 
Uzbekistan 0.4 5.28 
Multi-country programmes 6.7 1.5 
Total 65 38.96 0 
0 
0 
1.9 
0 
3.2 
0 
2 
0 4.1 
0 
0 
0 
0 
0 
2.4 
0 
0 
0 
0 
5.4 
0 
5 0 
3.6 
0 
0 
0 
0 
0 
0.6 
1 
16 21.1 19.5 
0 
15 
0 
3 2 
2.5 
0 
3 
2.3 
0 
1.7 
1.5 
0 
0 7.4 
6.1 
3 
9 
2.7 
3.9 
4.8 
4.1 
1 
18 116.1 
1 0.95 1.95 
6.9 41.58 
0 5.68 
3.5 19.7 
38 43.7 42.35 228.01 Armenia 
Azerbaijan 
Baltic States 
Belarus 
Georgia 
Kazakhstan 
Kyrgyzstan 
Moldova 
Mongolia 
Russia 
Tajikistan 
Turkmenistan 
Ukraine 
Uzbekistan 
Multi-country programmes 
Total 0 2.85 
0 4.4 
0 0 
0 0.7 
0 2.75 
6.4 
5.7 
1 
0 
0 
0 
2.5 
0 
3 
8.5 
37.8 0 1.63 
0 0 
0 0 
0 0 
0 18.95 
0 0 
0 0 
0 0 
0 0 
8 20.5 
8 41.08 Total 
2.85 
4.4 
0 
0.7 
2.75 
8.03 
5.7 
1 
0 
18.95 
0 
2.5 
0 
3 
37 
86.88 
Note: No budgets were allocated for policy advice in 1991 and 1995. 
50 
Telecommunications 
Funds committed by country each year Other sectors 
Funds committed by country each year 
1991 1992 1993 1994 1995 Total 1991 1992 1993 1994 1995 Total 
Armenia 
Azerbaijan 
Baltic States 
Belarus 
Georgia 
Kazakhstan 
Kyrgyzstan 
Moldova 
Mongolia 
Russia 
Tajikistan 
Turkmenistan 
Ukraine 
Uzbekistan 
Multi-country programmes 
Total 0 
0 
0 
0 
0 
0 
0 
0 4.93 
0 0 
0 0 
0 0.83 0.55 
0 0 0 
0 1 1 
0 6.76 6.65 0 
0 
0 
0 
0 
0 
0 
5.1 
0 
0 0 
0 
0 
0 
0 
0 
4.1 
0 
0 
0 
0 
0 
4.1 0 0 
0 0 
0 0 
0 
5.4 19.53 
0 0 
0 0 
0 1.38 
0 
2.5 0 
4.5 
7.9 25.41 Armenia 
Azerbaijan 
Baltic States 
Belarus 
Georgia 
Note: The telecommunications sector did not receive any funding in 1991 Kazakhstan 
Kyrgyzstan 
Moldova 
Mongolia 
Russia 
Tajikistan 
Turkmenistan 
Ukraine 
Uzbekistan 
Multi-country programmes 
Humanitarian aid 
Other* 
Total 0 
0 
2.05 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 0.8 
0 
0 
1 
0 0 
0.7 
0 
0.7 
0.8 0.5 1.3 
0.4 1.1 
0 2.05 
2 3.7 
0.5 1.3 
3.2 5.72 
1 2 
1.5 2.25 
0 0.64 1.4 1.12 
1 0 
0 0.75 
0 0.64 
10 15 14.79 39.79 
0 0.32 0.3 0.62 
0 0.8 0.32 1.12 
0 3.82 1.7 6.4 11.92 
0 0 1.5 1.8 3.3 
0 0.83 8 "16.5 "26 51.33 
0 0 22 0 0 22 
6.2 38.91 32.09 45.68 53 175.88 
8.25 39.74 80.11 86.21 111.71 326.02 
* Including multidisciplinary funds (Tacis and EBRD), Coordinating 
Units, Information and Communication, Partnership and Coordination 
Programme. 
** Includes Tacis Democracy Programme. 
51 
Tacis financial performance 
In 1995, Tacis' financial performance continued to 
improve, consolidating the substantial progress which the 
Programme made in 1994. 
Tacis also focused on decreasing the accumulated 
backlog of uncontracted commitments. By the end of 
1995, 70.5 per cent of Tacis overall commitments were 
contracted, compared to 61 per cent at the end of 1994. 
Tacis financial performance is indicated by the level of 
funds committed, contracted and paid and the 
relationship between these three indicators. 
Commitment of the Tacis budget 
Tacis continued to improve its level of budgetary 
commitment. The Programme committed 100 per cent of 
its funds in 1995. The actual amount of funds committed 
was higher in 1995 - ECU 511.19 million compared with 
469.68 million in 1994. This raised the total commitment 
over Tacis' five years of operation to ECU 2,268.37 million. Fig. 1 - Funds committed, contracted and paid, 
1991 to 1995 (in ECU million) 
1991 1992 1993 1994 i*.v. 
1995 
commitments contracts payments 
Amount contracted 
In 1995, Tacis contracted funds to a value of ECU 527 
million. This is an increase of 2.4 per cent from 1994, 
when a total of ECU 514.7 million was contracted. 
Tacis management set a number of targets for its 
contracting performance in 1995. It focused on 
contracting all 1992 programmes, and on contracting at 
least 90 per cent of the 1993 and 60 per cent of the 1994 
programmes. While Tacis achieved these targets for 1992 
and 1994, the implementation for 1993 is lagging slightly 
behind. In 1995, nearly 13 per cent of the programme 
was contracted. This is slightly lower than expected, due 
to delays in the nuclear safety and multi-country 
programmes. Fig. 2 - Cumulative funds committed, contracted 
and paid, 1991 to 1995 (in ECU million) 
CO I 
1991 1991-1992 1991-1993 1991-1994 1991-1995 
commitments contracts payments 
52 
Contracts by calendar year 
Tacis signed 1,472 contracts in 1995. As a general rule, 
service contracts over ECU 300,000 are awarded through 
restricted tendering procedures. The average size of a 
Tacis contract was ECU 360,000. Figure 3 shows the 
year's budget to which the signed contracts relate. Fig. 3 - Contracts concluded by calendar year 
(in ECU million) 
511.2 
472.1 469.7 
64.7 
1991 budget 1992 budget 1993 budget 1994 budget 1995 budget 
99.6% 99% 87.5% 66.3% 12.7% 
% contracted as of 31.12.95 
contracted in 1991 contracted in 1992 
• contracted in 1993 • contracted in 1994 
• contracted in 1995 • not yet contracted 
Funding procedure 
As part of the Tacis programming process, there are 
three steps which take the annual budget approved by 
the budgetary authorities through to the point where 
projects are implemented and funds disbursed. Tacis 
has a financial management procedure which matches 
this process. 
Commitment - Each year a Tacis budget is agreed, 
indicating the funds which the Commission is prepared 
to commit to the Tacis Programme. Operational 
programmes - the so-called Action Programmes - are 
then designed and financing proposals prepared on 
that basis. Once these financing proposals have 
received the favourable opinion of the Tacis Committee 
and been agreed by the Commission, the relevant 
funds associated with these proposals are said to have 
been 'committed'. Tacis must commit its entire annual 
budget within the year to which the budget applies. 
Uncommitted money is cancelled. Contracting - Once funds have been committed, 
tenders are issued so that the activities outlined in the 
Action Programmes can be put into practice. As soon 
as a tender has been successfully completed and a 
contract signed, the relevant funds are said to have 
been 'contracted'. Contracting is the most important 
measure of the implementation of the Programme, as it 
is via the contracts that Tacis funding is unlocked and 
real implementation on the ground can start. 
Payment - Payment is the final stage of the funding 
process. It takes place over the period of each 
contract, reflecting the completion of each component 
of the project. As projects may take several years, 
payments are often spread over the same time. It is for 
this reason that payments always lag behind the 
committed and contracted amounts. 
In 1995 Tacis made 3,347 payments, amounting to 
some ECU 374.5 million. 
53 
Tacis payments 
Tacis made particular efforts in 1995 to improve its 
payments performance. This resulted in an increase of 
24.7 per cent of the total amount for payments to ECU 
374.5 million, compared with ECU 300.3 million in 1994. 
Tacis achieved a 100 per cent payment execution ratio in 
1995, so that all of the payment appropriations available 
under the Tacis budget were disbursed during the course 
of the year. Fig. 4 - Payment in each budget year 1991-1995 
(in ECU million) 
511.2 
472.1 469.7 
396.5 
1991 budget 1992 budget 1993 budget 1994 budget 1995 budget 
82.9% 62.8% 38.8% 5.1% 
% paid as of 31.12.95 
paid in 1991 paid in 1992 • paid in 1993 
• paid in 1994 • paid in 1995 C not yet paid 
Cumulative contracts and payments 
The ratios of cumulative contracts and payments have 
increased continuously since the beginning of the Tacis 
Programme in 1991. The cumulative contracts as a 
percentage of cumulative commitments has risen from 1.3 
per cent in 1991 to 70.5 per cent in 1995. Figures for 
cumulative payments as a percentage of cumulative 
contracts show a considerable increase from 7.5 per cent 
in 1991 to 55.5 per cent in 1995. Fig. 5 - Cumulative contracts and payments 
1991-1995 (%) 
1991 1992 1993 1994 1995 
Cumulative contracts 
as percentage of 
cumulative commitments 
Cumulative payments 
as percentage of 
cumulative contracts 1.3% 25.6% 43.3% 61% 70.5% 
7.5% 15.6% 38.2% 47.9% 55.5% 
54 
List of major contracts signed in 1995 
Contracts under ECU 300,000 are not listed. 
Individual projects may comprise several contracts. 
Likewise, one contract may cover more than one project. 
Values are given to the nearest ECU 100. 
Armenia 
Policy advice programme for Armenia 
Technical assistance for the development 
of the gas industry 
Rehabilitation of Armenian Railways 
Azerbaijan 
Advice to the Ministry of Communication 
Improvement of consumer services 
in the gas and electricity industry 
Business development for the oil 
equipment manufacturing industry 
Support for the strengthening of management 
and training capabilities 
Support for institutional development 
within the employment service 
Rehabilitation of Azerbaijan Railways 
Traceca: Technical assistance 
for the development of the Port of Baku 
Belarus 
Technical assistance to Belarussian Railways 
Strategy formulation for privatisation 
and demonopolisation 
Creation of a transport advisory unit in Belarus 
Technical reform of the road building industry 
Development of marketing opportunities 
for former military enterprises 
SME strategy for private sector development 
Assistance and training for the Belarussian 
tax administration 
Support for Belarus Belautostrada 
Privatisation of the wood processing industry 
Creation of a business development agency, 
Gomel Oblast 
Georgia 
Policy advice programme for Georgia 
Technical assistance for enterprise 
level assistance 
1993-1994 Programme for SME development 
Reform and training in the civil service 
Rehabilitation of Georgian railways Value in ECU 
472,100 
1,599,600 
500,000 
525,600 
1,463,400 
1,979,000 
1,252,700 
499,300 
1,500,000 
698,100 
384,500 
636,000 
384,100 
1,287,300 
2,900,000 
1,898,000 
399,400 
1,695,000 
644,000 
349,800 
448,000 
1,800,000 
2,351,400 
1,668,800 
3,000,000 Kazakhstan 
Support for public investment 
programme management 487,400 
Advice to the Ministry of Communication 526,800 
Support to the privatisation of enterprises 979,000 
Strengthening of training capacity 
at Kazakhzstan State University 2,330,600 
Monitoring of the food and agriculture sector 544,900 
1994 Programme for SME development 1,019,800 
Support for commercial banking 589,700 
Technical assistance for economic reforms 
in the food and agricultural sector 1,348,600 
Support for the reorganisation of the food 
production sector, Aktiubinsk Oblast 1,799,900 
Strengthening of public administration 1,458,500 
Technical assistance for addressing the social 
impact of economic restructuring and privatisation 1,796,900 
Assistance to the Ministry of Education 
for the reform of higher education 600,000 
Traceca: Rolling stock maintenance, rail 695,300 
General on-site assistance, nuclear safety 900,600 
Kyrgyzstan 
Legal support for the Kyrgyzstan energy sector 619,200 
Moldova 
Support for the employment services 370,700 
Pilot project for the privatisation 
of the Orhei region 2,394,700 
Assistance to Private Farmers Association 1,395,300 
Support for the promotion and development 
of investment opportunities 590,000 
Strengthening of government 
and civil administration 1,899,800 
Extension of energy saving programme 
for Moldovan industry 599,500 
NGO co-financing project, for the elderly 
and children 300,000 
Mongolia 
Programme for SME development 2,252,100 
Reinforcement of employment services 1,199,900 
Support for an education information system 594,100 
Reform of economics education in Mongolia 1,997,500 
Improvement of energy supply to Choibalsan 
and Darkhan 995,200 
Support for the Coordinating Unit 535,900 
55 
Russia 
Restructuring of Soyouz Enterprise, Moscow 499,400 
Development of energy saving actions, Samara 359,500 
Development and establishment of employment 
offices in Kaliningrad 1,347,100 
Regional support to non-governmental 
organisations in western and eastern Siberia 710,000 
Technical assistance to October Railways 338,700 
Support for a telecommunications 
training centre, Moscow 300,000 
Technical assistance to Novosibirsk 
telecommunications training centre 696,000 
Follow-up project for business and 
telecommunications, Moscow 500,000 
Feasibility study on the integration of GLONASS 
into the European Global Navigation Satellite 
System 1,000,000 
Secondary legislation in the field 
of telecommunications 1,030,400 
Advisory services for the development 
of Russian Satellite Systems 300,000 
Training on-line maintenance and repair 
operation of Medium Volt Grid, Tula 690,000 
Energy policy advice to St Petersburg 898,600 
Communication management system, 
Lenenergo 489,200 
Development of St Petersburg harbour 1,174,100 
Modernisation of a training centre 
for flight personnel 986,800 
Strategic review of selected industries 799,200 
Restructuring of the aluminium sector in Siberia 1,137,200 
Restructuring of the aluminium sector in the Urals 1,199,100 
Strategic review of food packaging 580,900 
European Banking Advisory Service, Moscow 5,000,000 
Russian bank training 1,500,000 
Kamov helicopter study 1,271,500 
Production support: Tupolev enterprise 700,000 
Support for health systems development 4,500,000 
City Twinning project in administration 
and services 1,601,800 
Management planning of education in Russia 1,468,100 
Standards and certification in Russia and Ukraine 2,450,100 
Development of health and safety standards 699,000 
Strategic audit of coal exploitation 1,599,300 
Valorisation of oil and gas streams, 
Tyumen Oblast 714,100 
Development, structuring and organisation 
of the Russian oil industry 1,457,100 
Modernisation of the gas distribution system 
for St Petersburg 1,279,800 Petroleum engineering and related 
management training, Gubkin Institute 800,000 
Assistance for development of new oil fields 2,932,500 
Management and training of senior managers, 
Russian Railways 1,095,300 
Multimodal freight terminals, Russia 354,500 
Advice to the Ministry of Transport on 
planning regulations and standards 398,500 
Centres for road transport operators 1,148,000 
Implementation of electronic data interchange 
system in the port of Novorissiyrsk 948,900 
Assistance on the implications of institutional 
reforms on public transport 1,386,200 
New information technology - post offices 994,900 
Testing services for telecommunications 
equipment 1,228,600 
Establishment of a telecommunications 
training centre for the Samara region 493,300 
Monitoring of transport sector projects in Russia 791,700 
Monitoring and evaluation, Russian Federation 583,900 
Technical assistance to centres for Medium 
Enterprises, Siberia 6,800,000 
Support to public administration, Novosibirsk 
and Tomsk 2,417,600 
Technical assistance for addressing the social 
impact of economic restructuring, western Siberia 846,900 
Establishment of an Energy Centre, 
western Siberia 2,097,100 
Training for coal managers in Kemerovo 
and Kuzbass 1,199,300 
Energy supply and environment programme 
for the Lake Baikal region 985,700 
Monitoring of agriculture and food sector, 
western Siberia 994,500 
Technical assistance for addressing 
the social impact of economic restructuring 
and privatisation 406,100 
Social impact of economic restructuring, Urals 953,000 
Social impact of economic restructuring, 
Urals (addendum) 497,100 
Improvement of farm input 2,497,500 
Creation of Energy Centre, Ekaterinburg 2,456,500 
Technical assistance to the production 
of switching equipment - joint stock companies 1,886,200 
Support for restructuring of companies 1,839,800 
Technical assistance centre for medium 
to large enterprises in Voronezh 1,999,700 
Post-privatisation support 
to the Russian Federation 2,499,400 
Support to the Vimpel Corporation 
in the field of civil telecommunications 1,496,500 
56 
Atmosphere control in industrial areas 901,500 
Support for the reorganisation of 
the Tupolev Company 1,221,500 
Strengthening of an SME data network 
in the Russian Federation 1,954,900 
Business promotion, Vladimir 1,879,800 
Development and implementation 
of a migration policy 484,500 
Preparation and implementation of basic 
legislation in occupational safety 1,499,900 
Training and education in the Urals 303,900 
Strengthening of management training 2,486,500 
Procurement of printing equipment for 
the State Committee of Higher Education 300,000 
Refurbishing of heater sections, Angars 2,296,400 
Promotion of clean solid fuel combustion 
in Tula and Novgorod 999,900 
Teacher training, Gazprom 3,840,300 
Automated power consumption billing system 1,000,000 
Support for energy saving in urban heating 1,482,900 
Automatic power transmission and 
distribution control 2,336,300 
Establishment of a north west regional 
telecommunications training centre 700,000 
Development of teleports system in Moscow 
and St Petersburg 1,236,500 
ACE programme management, 1994 3,953,200 
Productivity Initiative programme 3,337,400 
Productivity project, local management unit, 
Moscow 380,000 
Monitoring and evaluation 3,298,600 
Support centres for enterprises 
in Rostov and Krasnodar 6,972,700 
Support for Beryev aviation complex 1,150,000 
Social impact of privatisation 4,298,900 
Development and strengthening of 
public administration in south west Russia 2,979,700 
Enhancement of teaching capacity 3,233,900 
Technical assistance to joint stock owned farms 2,497,600 
Support to food processing industry 2,351,000 
Support to fertilizer production 2,355,500 
Support to individually operated farms 2,500,000 
Support to agricultural machinery production 2,622,500 
Modernisation of a sulphur production 
and gas processing plant 1,494,400 
Improvement of power supply 
in the Rostovenergo area 1,806,900 
Technical assistance to fish industry 
complex, Kaliningrad 1,346,300 
Energy supply programme, Kaliningrad 988,900 Tajikistan 
Establishment of an agricultural strategy 
and planning unit 1,449,300 
Governmental advice for a strategy 
plan for energy 964,900 
Turkmenistan 
National capacity building in the field 
of economics and business management training 1,798,300 
Business preparation for export oriented 
credit line 395,000 
Ukraine 
Support to bank advisory services 596,300 
Establishment of a heat metering system 
for international consumers 348,200 
Training programme for electricity supply personnel 449,900 
Training for the coal mining industry Ukraine 349,800 
Training for oil refining industry personnel 404,700 
Demonstration projects on energy efficiency 690,700 
Integrated regional energy plan 
for the Odessa Region 572,200 
Conversion of six enterprises in Ukraine 2,809,000 
Advice and training for the use of waste anthracite 488,300 
District heating network, Dniepropetrovsk 599,800 
Feasibility study on gas turbine topping, Uglegors 399,400 
Modernisation of the Lysychansk refinery 698,600 
Restructuring of a mine in the Donbass coal field 398,800 
Coal based methane production 399,300 
Assistance for the creation of national 
electricity company for the Ukraine 900,000 
Establishment of a transport training centre 341,200 
National road network study 600,000 
Technical assistance for the development 
and regulation of the aviation industry 524,200 
Training maritime field, Odessa 359,800 
Access to ports of Ismail and Reni 338,700 
Retraining of former military officers 7,275,600 
Monitoring and evaluation programme 583,400 
Monitoring and evaluation programme 795,900 
Ukraine nuclear electricity generator 876,700 
Commercial development of the energy sector 1,683,400 
Boiler and valve production for the energy sector 943,500 
Study on the efficiency of power generation 2,635,400 
Restructuring of the oil and gas entities 2,099,000 
Cost and efficiency analysis of 
urban district heating systems 2,399,900 
Post-privatisation support 3,298,300 
57 
Assistance to the Ukraine government 
on private enterprises 989,600 
Pilot project for agricultural restructuring 4,797,300 
Establishment of a training centre 
for energy management 1,399,300 
Support to Zaparozhye 6, Rovno 4 
and Khmelnitsky 2, nuclear power plants 2,953,600 
Support to Zaparozhye 6, Rovno 4 
and Khmelnitsky 2, nuclear power plants 982,500 
Uzbekistan 
Support for industrial property protection 400,000 
Establishment of law centres for entrepreneurs 394,300 
Support for public sector reform 1,399,800 
Pilot integrated development programme, 
Samarkand 1,675,200 
Establishment of food and agricultural policy 1,549,800 
Assistance to the government of Uzbekistan 779,100 
Restructuring of commercial banks 824,200 
Advice to the Ministry of Communications 492,400 
Regional bank training in Central Asia 999,900 
Multi-country programmes 
Support for intellectual property protection 2,000,000 
On-site assistance for Kalingrad nuclear 
power plant, phase 2 319,200 
Procurement of equipment for nuclear 
power plants 2,173,500 
WER 1000 core analysis, nuclear safety 876,400 
Upgrade of service and maintenance centre, 
nuclear safety 1,435,300 
Non-destructive examination and 
in-service inspection of mechanical 
equipment in Russian nuclear power plants 1,294,700 
Twinning programme, engineering group 435,100 
Twinning programme, engineering group 320,000 
Trade and transport cooperation 
and working group 990,300 
Traceca: immediate training action 861,200 
Traceca: forwarding and freight operation 499,800 
Air traffic control and airports 609,200 
Policy advice programme 400,000 
Establishment of Tacis technical data centre 527,100 
Recruitment of a senior project manager 
for the ISTC 360,000 
Russia regional venture fund framework - EBRD 722,400 
Regional venture fund for Urals procurement agent 769,400 
Regional venture fund for western Siberian 
procurement agent 769,400 Small and medium-sized enterprises, 
regional programme 3,800,000 
Programme for the treatment of thyroid cancer 399,900 
Rail transport feasibility study 496,600 
Traceca: Rail freight traffic management 850,000 
Regional traffic forecasting model 698,100 
Traceca: Legal regulatory framework 1,497,600 
Traceca: Implementation 
of pavement management 999,100 
Traceca: Infrastructure Maintenance 1 1,200,000 
Requirement for extended economy and security 1,639,800 
Improvement system for operational planning 1,083,000 
Improvement of electricity distribution 
in Central Asia 1,121,000 
Technical study on the interface 
of west European and east European 
power systems 402,700 
Regional oil and gas pipeline management 
in Asian and Caucasian republics 485,500 
Development Technicum (agriculture) 300,000 
Databases, dictionaries and social security 
for use in the energy sector 545,600 
Convention between DGIA and the 
European Training Foundation 602,400 
Technical development of statistical 
information in the NIS 1,500,000 
Customs training in Kazakhstan, Kyrgyzstan 
and Uzbekistan 400,000 
Support for the establishment of a Tacis 
technical data centre 892,700 
WER-213/1000 confinement cable penetration, 
nuclear safety 2,000,000 
RBMK safety assessment, Phase 2, 
nuclear safety 2,980,600 
Development of safety panel prototype 
WER 1000, nuclear safety 1,989,800 
Reactors quality assurance programme 500,000 
Technical assistance to Rosenergoatom 994,600 
Support for licensing related assessments 
of primary circuit integrity 487,700 
Licensing related assessments of 
safety design and operational safety 781,700 
Licensing related assessments of safety 
associated modules 487,300 
Licensing related assessments of accident analysis 390,800 
Nuclear fuel cycle and waste sorting 616,600 
Management of radioactive waste, Moscow 678,300 
Container for WER reactor's spent fuel 449,600 
Local computer network for Beloyarsk nuclear 
power plant 547,300 
58 
Establishment of nuclear engineering procedures 877,800 
Development plan for creating a regional 
training centre for nuclear safety 1,099,300 
Development plan for creating a national 
training plan for nuclear safety 1,199,500 
Scheme for safety management for nuclear safety 680,100 
WER primary system training specialists 849,700 
Investigation of the impact of spent nuclear fuel 377,900 
Support to accident analysis, Ukraine 
Safety Authority 1,299,700 
Urgent measures to remodel the uranium 
mining in the NIS 1,415,000 
Assistance for the transport of irradiated 
nuclear fuel 982,000 
Food quality technical support 1,117,900 
Establishment of a Tacis Technical 
Office in Kiev 428,800 
Addendum to Technical Office in Kiev 409,100 
Training in Tacis project cycle management 349,800 
Russian Regional Venture Fund, Urals 1,000,000 
Russian Regional Venture Fund, Urals 1,000,000 
Russian Regional Venture Fund, Siberia 1,000,000 
Russian Regional Venture Fund, Urals 1,000,000 
Russian Regional Venture Fund, Smolensk 1,000,000 
Tacis information and communications 
programme 1,500,000 
On-Site assistance, Balokovo 994,900 
On Site assistance, Leningrad 1,319,100 
On-Site assistance, Kola 1,808,100 
RMBK training centre, Smolensk 498,900 
Photogrammetrical equipment, 
soft adaptation nuclear power plant 762,300 
On-Site assistance, Kalinin 1993-94 2,611,500 
General on-site assistance, bn.600 701,500 
Dynamic calculations of nuclear 
power plant structures 791,900 
Integrity assessment WER 1000 reactors 489,000 
WER tightness assessment, improvement 
of seal configuration and equipment supply 1,199,100 
Preparation of an industrial fatigue 
diagnostic system, nuclear safety 498,800 
Licensing related assessments of reactor 
vessel embrittlement 487,100 
Assistance and management to severe 
nuclear accidents 973,300 
Licensing related assessments of safety 
associated modules 488,700 
On-site activities, Ukraine south, phase 2 2,748,200 On-site assistance, Zaparozhye, phase 2 1,299,100 
Procurement of office equipment, 
nuclear safety 1,100,000 
Twinning Programme engineering group 502,300 
Policy and legal advice programme 1,000,000 
Policy and legal advice programme 6,800,000 
Policy and legal advice programme 1,000,000 
SME regional programme 1994, twinning 500,000 
Development of SME, 1994 NIS Partenariat 1,300,000 
Study on the interconnection of the Caucasus 498,500 
Support to the Agricultural Free Trade Area 1,854,300 
Courses on Joint Vienna Institute 457,500 
NGO cofinancing programme; support to 
the disabled in the Russian Federation 300,000 
NGO cofinancing programme; support 
for the visually impaired in the Russian Federation 300,000 
Monitoring and evaluation; for west 
and south west Russia 2,499,600 
Europartenariat, Lisbon 300,000 
Technical assistance to Georgian agriculture 300,000 
Moscow and St Petersburg, EBRD 480,000 
Russia Technopark management 838,400 
Development of Turkmenistan export line 990,400 
Upgrading of air navigation system, Azerbaijan 300,000 
Credit advisers, Petrovsky 711,600 
Russia business advisory services, EBRD 575,000 
Technical assistance to Tacis Coordinating 
Units in Belarus, Ukraine and Moldova 1,773,800 
Technical assistance to Tacis Coordinating 
Units in Kazakhstan, Kyrgyzstan, Turkmenistan 
and Uzbekistan 1,768,100 
Technical assistance to Tacis Coordinating 
Units in Armenia, Azerbaijan and Georgia 1,350,300 
Service contract for travel services 
for Coordinating Units 300,000 
Western expertise to the Coordinating 
Unit in Russia 1,144,500 
Tacis information and communication strategy 2,200,000 
Food aid in favour of Armenia, Azerbaijan, 
Georgia, Kyrgyzstan and Tajikistan 553,000 
Monitoring of food operation, Caucasus 2,065,800 
Assistance to managers of the NIS component 
of the Phare and Tacis Democracy programme 761,900 
Russian Elections: Support to EU Election Unit 349,700 
Legal system reform, Ukraine 420,000 
Democracy programmes, parliamentary 
training project for the Ukraine 949,300 
59 


ISSN 0254-1475 • Com (96) 345 final • DOCUMENTS • EN • Catalogue number: CB-CO-96-344-EN-C 
ISBN 92-78-06621-4 • Office for Official Publications of the European Communities L-2985 Luxembourg 
European Commission • Directorate General for External Relations: 
Europe and the New Independent States, Common Foreign and Security Policy, External Missions (DG IA) 
Information Unit - Tacis 
Office Address Montoyerstraat 34 3/88 Rue Montoyer B-1000 Brussels Tel (+32-2) 295 25 85 / 296 60 65 / 296 64 94 
Mailing Address MO 34 3/88 Wetstraat 200 Rue de la Loi B-1049 Brussels Fax (+32-2) 296 80 24 / 231 04 41 English 
World Wide Web Address http://europa.eu.int/en/comm/dg1a/tacis/home.html E-mail tacis.info@dg1a.cec.be T/EN/08.96/02/02/11/B