COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 12.09.1996 
COM(96) 441 final 
-Proposal for a Council decision concerning the adoption of the guidelines 
for MEDA indicative programmes 
(presented by the Commission) 

EXPLANATORY MEMORANDUM 
1. Following adoption by the Council, the MEDA Regulation, concerning 
financial and technical measures to accompany the reform of economic and 
social structures in the framework of the Euro-Mediterranean Partnership, came 
into force on 2 August 1996. 
2. The MEDA programme thus has a legal basis which sets out the rules for 
management of the implementation of measures to be taken, in particular, in the 
areas of economic transition, sustainable social and economic development, 
regional and trans-frontier cooperation and support for civil society. 
3. The MEDA Regulation foresees a three stage programming procedure. 
It requires the Commission to propose to the Council a set of general guidelines 
for the MEDA indicative programmes. Subsequently, the indicative 
programmes and the financing proposals are to be adopted by Commission on 
the basis of the opinion of a management committee. 
4. The proposed general guidelines explain that the purpose of the indicative 
programmes is to provide an instrument for strategic management of the MEDA 
programme. They should, in particular, allow for identification of priorities 
with the Mediterranean partners and for coordination with the Member States. 
5. The Commission has communicated to the Council the overall financial 
programming for the MEDA programme for the period 1996-98 through other 
channels. 
6. The Council is to adopt these guidelines by qualified majority 
L 
Proposal for a Council decision concerning the adoption of the guidelines for MEDA 
indicative programmes 
The Council of the European Union, 
Having regard to the Treaty establishing the European Community, 
Having regard to regulation (EC) No 1488/96 of the Council of 23 July 1996 concerning 
financial and technical measures to accompany (MEDA) the reform of economic and 
social structures in the framework of the Euro-Mediterranean Partnership, and notably its 
article 9§1, 
Whereas Article 9 of the MEDA Regulation foresees that the Council shall, on a proposal 
from the Commission, adopt guidelines for the indicative programmes which are to define 
the main objectives of cooperation with the Mediterranean partners, 
Whereas the Commission presented a Communication on 8.3.95 entitled " Strengthening 
the Mediterranean Policy of the European Union: proposals for the implementation of a 
Euro-Mediterranean Partnership", 
Whereas, in the Barcelona declaration, the Euro-Mediterranean Partnership has been 
adopted to meet the challenges facing the region, 
Whereas it is necessary to determine guidelines for the MEDA indicative programmes, 
HAS ADOPTED THE FOLLOWING DECISION: 
Article 1 
The guidelines for the indicative programmes concerning financial and technical measures 
to accompany the reform of economic and social structures in the framework of the Euro-
Mediterranean Partnership (hereinafter referred to as MEDA indicative programmes), as 
shown in annex to the present decision, are adopted. 
Article 2 
This decision shall take effect from the date of its adoption. 
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Annex 
COUNCIL GUIDELINES FOR MEDA INDICATIVE PROGRAMMES 
1. The MEDA programme represents the European Community's main financial 
instrument for the implementation of the Euro-Mediterranean partnership. The programme 
has the purpose of encouraging and supporting the reform of the economic and social 
structures of the Mediterranean Partners, notably in preparation for free trade with the 
European Community. 
2. MEDA is founded on the respect for democratic principles and the rule of law, as well 
as the respect for human rights and fundamental freedoms, of which they are an essential 
element and whose violation would justify the taking of appropriate measures. 
The experience gained through the Bilateral Protocols 
3. The MEDA programme is to build on the experience gained through the operation of 
the instruments of the Redirected Mediterranean Policy, namely the bilateral financial 
protocols and a facility for regional cooperation. After 4 generations of financial protocols 
with the Mediterranean partners it has become necessary to seek an improvement in the 
system of delivery of cooperation activities. If MEDA is to be capable of responding to the 
challenge of significantly intensified cooperation, both in new and existing domains, then it 
is necessary to increase flexibility in the programming. This is to avoid dispersion of the 
cooperation effort over too wide a number of activities and beneficiaries and to give an 
incentive for rapid and efficient implementation of commitment and payment credits. 
Equally, MBDÀ must be capable of adaptation over time as lessons are learned through its 
implementation and as the needs and priorities of the Mediterranean partners evolve in the 
light of socio-economic challenges. In particular, a sufficiently high degree of flexibility for 
the amounts allocated to untied budgetary support in the indicative programmes should be 
maintained in order to adapt the financial allocations to the pace of reform and to the progress 
achieved in macroeconomic stabilisation. 
Multi-annual programming 
4. The extra flexibility of the MEDA programme needs to be complemented by a clear 
programming methodology in order to enhance effectiveness of planning and implementation. 
In particular it is necessary to give the partners an indication of the resources which are to be 
made available over the coming years. Such multi-annual programming will increase the 
possibilities for interventions having a medium-term policy impact. The MEDA Regulation 
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contains a financial reference figure of ECU 3.424 billion for the period 1995-99', which is 
to be partitioned between bilateral programmes and a regional programme. The MEDA 
indicative programmes should identify activities which contribute to the attainment of the 
wider objectives of the Partnership. These may be revised, in accordance with implementation 
performance, together with the accompanying indicative bilateral financial allocations. Care 
will be taken to ensure transparency and overall consistency of action undertaken using budget 
appropriations. 
Strategic interventions 
5. Ultimately the successful socio-economic development of the Mediterranean partners 
will depend on their own efforts. Thus, to be effective the indicative programmes must be 
based on a shared understanding of the economic, social and political challenges facing each 
Partner and the region as a whole. A regular and rich dialogue both at bilateral and regional 
level is therefore a pre-condition for the success of MEDA. The indicative programmes shall 
concentrate on those areas where the European Community can make the most positive 
contribution by drawing on its stores of experience and know-how. With this aim the 
Commission shall take care to provide for the necessary coordination with the Member States 
and other donors in its programming and programme implementation. 
6. As it pursues the goal of sustainable development the Commission shall, in its 
identification and design of programmes of cooperation, carefully consider the issues of 
environmental equilibrium, financial and economic viability, gender repercussions and local 
institutional capacity, including those for research and technological development and 
technology transfer to replicate or continue activities which have been initiated. At a bilateral 
level, the MEDA programme will provide support to the partners in the fields of economic 
transition and strengthening of socio-economic equilibrium. Environmental Impact 
Assessment forms will be required for the relevant projects of bilateral and regional 
programmes, according to the European Union legislation in this field. 
7.i) The economies of the region face the common challenge of creating employment 
opportunities and an increased standard of living in the context of rapid demographic growth. 
The necessary acceleration in economic growth can only be reached through greater 
competitiveness within the global economy. This requires an improvement, inter alia, of the 
capacity for innovation of the partners. As free trade is gradually established so the 
governments must leave room for private sector led growth and for foreign investment. 
Sound macro-economic management must be complemented by pro-growth and investment 
friendly economic policies and regulatory framework. The indicative programmes will take 
into account the characteristics of each economy when planning interventions. 
'The Cannes European Council of 12 June 1995 gave its agreement to a global financial 
envelope for Mediterranean third countries for the period 1995-99 of ECU 4.685 billion. The 
MEDA programme of approximately ECU 3.424 billion constitutes the largest part. The 
remainder is made up of specific country protocols and thematic budget lines. 
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ii) Economic growth needs to be accompanied by greater social cohesion. Inequalities 
in access to essential services such as education, health and water persist which reduce the 
life-chances of significant portions of the population of the Partners and which have a 
negative effect on long term growth prospects. These needs should be addressed urgently 
through improvements in the quality of services and greater efficiency in their delivery. 
Strategic interventions are required for the development of human resources in general as they 
represent the region's greatest asset for the future. In particular, the integration of the young 
and of women into the workplace constitutes an important factor of social development for 
the region. 
The bilateral and regional programmes are to be complementary 
8. Support will be given through the measures set out in the MEDA Regulation. 
Furthermore, from the ongoing dialogue with the Partners it has been possible to develop the 
following general guidelines. 
9. The activities undertaken at bilateral and regional level are to be complementary to 
enable the political and economic impact of the MEDA programme to be sustained and the 
objectives jointly adopted in the Barcelona Declaration more effectively reached. Drawing 
from its own experience it is the Union's view that the future prosperity and stability of its 
partners rests on increased cooperation between themselves in the economic, social and 
political spheres. The elimination of barriers will foster economies of scale and greater 
market opportunities thus encouraging investment, facilitating the exchange of ideas and 
increasing mutual understanding. The regional indicative programme will reflect the progress 
made in the framework of the Barcelona process in taking action at a multilateral level on 
issues of common concern, as laid down in the agreed declaration, and will strengthen the 
activities in support of decentralised cooperation. However, regional activities shall not 
displace funding of bilateral activities. 
Decentralized approach 
10. In order to reach target populations more effectively and to widen the participation in 
the MEDA programme to the different parts of civil society that are included in the scope of 
the Euro-Mediterranean Partnership, the Commission shall strive to design and implement its 
activities together with the actors who are directly concerned and who have the expertise 
necessary for successful design and implementation of interventions. 
Bilateral indicative programmes 
II. Concerning the bilateral programmes the priorities are to be decided taking into 
account the stage of development of each country's economy and society as well as the 
capacity of its institutions. In the light of the conclusion or implementation of association 
agreements, the indicative programmes are to be decided taking into account the needs of the 
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Mediterranean partners, their capacity to absorb funds and the progress made in structural 
reform process, as well as the priorities identified with them, in particular those emerging 
from the conclusions of the economic dialogue. 
12. In the Maghreb, support to Morocco is to be given to improve fundamental social 
services (in particular in education and health care, with special regard to rural areas), as well 
as to measures enhancing enterprise competitiveness. In parallel, the programme provides 
budgetary support to underpin a medium-term strategy of macroeconomic stabilisation and 
broad structural reforms. In Tunisia, support is to be given to the process of economic 
liberalisation and enhancement of competitiveness, incentivating progress in the privatisation 
process and in financial sector reform; this is to be complemented by measures address areas 
of social and environmental concern. As regards Algeria, interventions should address critical 
social needs and employment creation in the short term, while supporting SME development, 
the restructuring of loss-making public enterprises and encouraging the adoption of measures 
to develop the financial sector and to reform the country's trade regime. 
13. In the Mashraq, support to Egypt is to be mainly in the areas of basic education and 
social development through poverty alleviation and assistance to key social sectors: this should 
be complemented by appropriate interventions in the fields of economic reform, training and 
environmental protection. Cooperation with Jordan should initially contribute to providing 
the budgetary support which is necessary to stabilise the serious macro-economic imbalances 
which exist and, at a second stage, to improving the employment situation. For the Lebanon, 
as reconstruction efforts are fully underway, emphasis should now be placed on strengthening 
the public administration at all levels whilst intervening in a targeted manner to develop 
economic competitiveness. Regarding Syria, in order to accompany progressive economic 
liberalisation, cooperation should focus on upgrading of public services and administration in 
order to both provide a more favourable environment for the private sector and to improve 
the living conditions of the population. Concerning the West Bank and the Gaza Strip 
assistance will continue to be given to the reconstruction and rehabilitation of basic 
infrastructure, as well as in support of the process of Palestinian institution building and the 
development of the private sector. 
14. The programme for Turkey will have the overall objective of supporting the 
establishment of a customs union and will prioritise interventions related, on the one hand to 
the necessary economic adaptation and, on the other hand, support to social services and the 
environment. 
Support to economic transition 
15. The Mediterranean partner countries need help to prepare for free trade with the 
European Union and to raise the standard of living. The wider objective of European 
community interventions will be to increase the competitiveness of the partners' economies, 
with a view to achieving sustainable economic growth , in particular through improved export 
performance. 
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To this end assistance will be given in particular in the following fields: 
. The creation of an enabling environment through the reinforcement of the macro-
economic framework and the development of the legislation and institutions necessary for a 
competitive market economy. For this purpose, structural adjustment operations should be 
supported in close cooperation with the Bretton Woods institutions, for those partners who are 
ready to implement the necessary reforms. 
. Trade facilitation, including assistance in the field of customs and indirect taxation, 
harmonization of standards and veterinary and phyto-sanitary regulations, as well as 
development of trade promotion instruments. 
. Harmonization of legislation and standards in the field of the environment. 
. Development of the financial sector through support at the policy level and assistance 
to strengthen the Central Banks, to develop the commercial banks and to widen and deepen 
the financial markets; particular attention will be given to the stimulation of domestic savings 
and investment, as well as promotion of investment into the region, especially European. 
. Improvement of business performance, in particular by the modernization of SMEs, 
through business consultancy, training and information. 
. Business collaboration between European and Mediterranean companies, especially 
SMEs, through, for example, networking, joint-ventures, licensing, franchising and sub­
contracting. 
. Promotion of privatization to ensure the effective transfer of ownership, management 
and control to the private sector. 
. Cooperation in the energy, transport and telecommunications sectors regarding policy, 
interconnection and interoperability of infrastructure and networks, the improvement of quality 
and reduction of cost of service provision, industrial cooperation and research and 
technological development. 
. Support to micro-enterprises with a view to promoting entrepreneurs and helping to 
integrate all segments of society in the process of economic growth. 
. Human resource development through the improvement of the management, targeting 
and quality of vocational and management training. 
. Enhancing the innovation systems of the partners through improved research and 
technological development capacities and technology transfer mechanisms and supporting the 
development of appropriate national innovation policies. 
Strengthening the socio-economic balance 
16. in order to alleviate the short term costs of economic transition and better prepare 
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societies for the future, it is particularly important that this process should be accompanied 
by appropriate measures in the field of social policy. 
. Integrated rural development remains an essential strategy for combating poverty and 
avoiding a widening welfare gap between rural and urban populations because a large 
proportion of the populations of the Mediterranean partners remains attached culturally and 
economically to the countryside. Agricultural production has a social role over and above its 
economic value and an increased exodus towards urban areas could have socially, politically 
and environmentally serious consequences. Targeted programmes are also required to address 
essential needs (such as water supply and sewage as well as energy). 
. Particular attention should be accorded to preserving the environmental equilibrium 
in the partner countries through supporting the capacity building in the field of environmental 
assessment and management. Interest rate subsidies may be granted on loans of the European 
Investment Bank for environmental projects. 
. Programmes addressing the improvement of living conditions in urban areas should 
be supported including, where appropriate the development of social safety nets through pro­
active employment policies and anti-poverty measures. This may take the form of a social 
fund which promotes employment for disadvantaged social sectors and also supports targeted 
health and education measures. Assistance may be given to the formulation of social policy, 
particularly in the fields of health and unemployment insurance and pension schemes. 
. Improvements in the social infrastructure and in the delivery of social services should 
be supported. Primary health may be financed also as part of the strategic objective of 
reducing population growth. 
. Improvements in the delivery of services in the field of education and training should 
be supported, particularly as regards primary education and initial training for girls and 
notably in rural areas. 
The development of civil society 
17. The development of civil society should be supported, in particular through 
decentralized cooperation and the deployment of enabling technologies. Cooperation in the 
field of research and technological development and technology transfer is to be stimulated, 
bringing in contact private and public actors. Cultural activities are to be supported which 
promote dialogue and exchange between cultural associations and networks. Trans 
Mediterranean information and communication activities should be strengthened in the 
framework of the development of a truly Euro-Mediterranean information society. Social 
partners and non-governmental organisations should be encouraged to play an active role. 
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Guidelines for the regional indicative programme 
18. Regional cooperation shall be complementary to bilateral cooperation and shall address 
the three main areas of the Euro-Mediterranean Partnership. Account shall be taken of the 
progress made at the meetings organized in the context of the follow up to the Barcelona 
inter-ministerial conference. The overall aim shall be to encourage better understanding 
between the Partners through increased knowledge of regional problems in the political, 
economic, social and cultural fields, facilitating the exchange of best practice and transfer of 
know how and promotion of joint projects of common interest. 
Furthermore, the European Community will continue to provide support to the Middle East 
Peace Process. 
19 In the political field, as in the case of bilateral programmes, through measures 
falling within the scope of the MEDA Regulation, support may be given to the 
development of democracy and the respect of human rights as well as to improvement of 
the transparency and efficiency of governmental institutions. Support may also be given 
to promote the building of confidence in the security field. 
20. In the economic and financial fields assistance will be given to facilitate free trade, in 
particular in the fields of customs regulations, rules of origin, statistics, norms and veterinary 
and phyto-sanitary regulations. 
Appropriate measures will be taken in the fields of transport, energy (where the Euro-
Mediterranean Energy Forum will act as a coordinating instrument), telecommunications and 
information technology, regional cooperation, tourism, the environment, science and 
technology, water and fishing. Networking among research and development centres and 
economic operators to facilitate the transfer of know-how and the development of joint-
ventures will also be supported. 
21 In Ihe social and cultural spheres, decentralized programmes of exchanges between the 
civil societies of the European Union and the Mediterranean partners will be implemented in 
the fields of academia, media, local government, technology and other fields of mutual 
interest. 
Further measures such as dialogues, projects of common interest or networking will be taken, 
as identified in the framework of the Euro-Mediterranean partnership, to support local 
government, cultural dialogue, media, youth exchanges, exchanges between civil society. 
Research and technology development, technology transfer, information and communication 
activities will be strengthened through recourse to modern information technology. 
Finally, technical assistance may be given with the aim of combating drugs, terrorism and 
international crime. Measures could address the exchange of information, the compatibility 
of data, and the strengthening of legal systems. 
4o 
ISSN 0254-1475 
COM(96) 441 final 
DOCUMENTS 
EN U 
Catalogue number : CB-C0-96-447-EN-C 
ISBN 92-78-08737-8 
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