Phare 
European Commission: 
The Phare 
Programme 
Annual Report 
1995 
Brussels 23.07.1996 Com (96) 360 
final 
What is Phare? 
The Phare Programme is a European Community initiative 
which supports the development of a larger democratic 
family of nations within a prosperous and stable Europe. 
Its aim is to help the countries of central Europe rejoin the 
mainstream of European development through future 
membership of the European Union. 
Phare does this by providing grant finance to support its 
partner countries through the process of economic transfor­
mation and strengthening of democracy to the stage where 
they are ready to assume the obligations of membership of 
the European Union. The main priorities for Phare funding are common to all 
countries, and include restructuring of state enterprises 
including agriculture, private sector development, reform 
of institutions, legislation and public administration, 
reform oi' social services, employment, education and 
health, development of energy, transport and telecommuni­
cations infrastructure, and environment and nuclear safety. 
For countries that have signed Europe Agreements, Phare 
is the financial instrument of the European Union's pre-
accession strategy which will lead them to full member­
ship. 
In the first six years of operation to 1995, Phare has made 
available ECU 5,416.9 million to eleven partner countries, 
making Phare the largest assistance programme of its kind. 
Phare works in close cooperation with its partner countries 
to decide how funds are to be spent, within a framework 
agreed by the European Community. This ensures that 
Phare funding is relevant to each government's own 
reform policies and priorities. 
Phare provides know-how from a wide range oi non­
commercial, public and private organisations to its partner 
countries. Phare acts as a powerful catalyst by unlocking 
funds for important projects from other donors through 
studies, capital grants, guarantee schemes and credit lines. 
It also invests directly in infrastructure, which will account 
for more Phare funds as the integration process progresses. 
Contents 
Commissioner's statement 2 
Phare 1995 financial overview 3 
Political developments in 1995 3 
Phare in 1995 6 
Operational management of Phare 10 
Albania 13 
Bulgaria 14 
Czech Republic 16 
Estonia 18 
Hungary 19 
Latvia 20 
Lithuania 21 
Poland 23 
Romania 25 
Slovakia 27 
Slovenia 29 
1990 - 1995 funds committed by country 30 
1990 - 1995 funds committed by sector 32 
Phare funding by country 34 
Phare funding by sector 40 
Phare financial performance 44 
Major programmes launched in 1995 47 
Commissioner's statement 
Over the last year the Phare Programme has greatly 
increased its role as a provider of grant finance and know-
how to the countries of central Europe. As political 
relations between those countries and the European Union 
have progressed, Phare has embraced a new purpose. 
In 1995, therefore, Phare began to function as the financial 
instrument of the European Union's pre-accession 
strategy. Unveiled at the European Council in Essen, 
December 1994, the pre-accession strategy is the means 
whereby the central European countries can progress 
towards full membership of the European Union. It is 
designed to help them bridge the gap between their 
political and economic systems and those of the European 
Union. 
In 1995, the European Commission published its White 
Paper on the preparation of the partner countries for 
integration into the internal market. Phare is supporting 
the implementation of the White Paper, which guides the 
partner countries in their efforts to harmonise their 
legislation with that of the European Community. At the 
same time, 1995 was a year in which Phare focused on 
sectors whose development is closely linked to 
integration, such as infrastructure investment and cross-
border cooperation. 
Phare's role in the pre-accession strategy is also reflected 
in the new programming cycle. National and cross-border 
programmes are now mapped out over a multi-annual 
period. This means that Phare operates in the framework 
of medium-term objectives, and can respond more flexibly 
to the needs of the partner countries. As shown in this 
Report, Phare has also made improvements in its 
operational procedures. This has been possible because of 
the dedication and commitment of the Commission staff 
who work on Phare. The Dayton peace agreement reached in December 
required the help of the international community. In the 
same month, the European Commission and the World 
Bank organised the first meeting of donors for Bosnia-
Herzegovina, with the objective of identifying 
reconstruction needs and mobilising donor assistance. A 
programme was prepared and, on the basis of a multi­
lateral plan, the first phase of the Phare Essential Aid 
Programme (worth ECU 62.5 million) was launched in 
January 1996. Above all, this programme illustrates the 
concrete support given by the European Union to the 
peace process which will eventually bring Bosnia-
Herzegovina into the scope of Phare funding. 
As a new millennium approaches, the enlargement of the 
European Union is an ambitious project which requires 
the support of both the Union and the central European 
countries preparing to join. Phare is at the heart of that 
project. As the European Commissioner responsible for 
the Programme in 1995 and who will take the Programme 
forward in 1996,1 commend this Annual Report to you. 
Hans van den Broek 
Member of the European Commission 
Phare 1995 financial overview 
In 1995, the Phare Programme committed a total of ECU 
1,154.7 million to its partner countries. This is an increase 
of 19 per cent on 1994 (ECU 973 million), and represents 
a commitment rate of 99.4 per cent. Total commitments 
over the life of the Programme (1990 to 1995) now equal 
ECU 5,416.9 million. 
During 1995, Phare contracted funds totalling ECU 
1,142.9 million. This represents an increase on 1994's 
total contracts (ECU 665 million) of 72 per cent and is a 
significant achievement for the Programme. Phare also 
paid ECU 762.4 million in 1995 which was an increase of 
5 per cent. 
In total, therefore, 62.3 per cent of all Phare funds 
committed have been contracted, and of the contracted 
funds 85.9 per cent have been paid. 
The following chart shows the breakdown of Phare funds 
committed year on year, 1990 - 1995. 1990 1991 1992 1993 1994 1995 
It should be noted that the 1995 Phare Annual Report 
contains figures from all five budget lines managed within 
the framework of the Phare Programme. Owing to 
reporting software limitations, figures contained in the 
1994 Phare Annual Report only included two budget 
lines. This therefore accounts for the small discrepancy in 
the historical figures between the 1994 and the 1995 Phare 
Annual Reports. 
Political developments in 1995 
Phare is at the heart of the political and economic relations 
between the European Community and the partner 
countries of central Europe. Those countries are now 
preparing for full membership of the European Union. 
The pre-accession strategy, adopted at the Essen Council 
in December 1994, provides the framework for their 
preparations. Phare is the financial instrument of that 
strategy. 
Pre-accession strategy 
The pre-accession strategy is the path which leads the 
central European countries with Europe Agreements 
towards full membership of the European Union. It is 
designed to help the partner countries bridge the gap 
between their political, economic and legal systems and 
those of the European Community. 
The strategy for accession was adopted at the Essen 
Council in December 1994. This represented a clear 
turning point in the relationship between the European 
Union and its partner countries. The strategy has three main elements: the Europe 
Agreements, the structured dialogue, and the Phare 
Programme. 
Europe Agreements 
The Europe Agreements are the framework for bilateral 
relations between the European Communities and their 
Member States on the one hand, and the partner countries 
on the other. Developed by the European Community in 
1990 and then signed with individual countries over the 
following years, the Europe Agreements cover trade 
related issues, political, economic and cultural cooperation 
and list Phare and the European Investment Bank as 
providers of financial assistance. They are based on shared 
understandings and values, and prepare the way for 
progressive convergence in a wide range of areas. Given 
that accession to the European Union is now the explicit 
goal of the partner countries, the Europe Agreements have 
become the framework within which these countries 
prepare for membership. 
Country 
Bulgaria 
Czech Republic 
Estonia 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia Europe Agreement 
signed 
March 1993 
October 1993 
June 1995 
December 1991 
June 1995 
June 1995 
December 1991 
February 1993 
October 1993 
June 1996 Europe Agreement 
came into force 
February 1995 
February 1995 
February 1994 
February 1994 
February 1995 
February 1995 Official application 
for EU membership 
December 1995 
January 1996 
November 1995 
March 1994 
October 1995 
December 1995 
April 1994 
June 1995 
June 1995 
June 1996 
The Europe Agreements acquired greater political 
significance following the European Council summit in 
Copenhagen in 1993. There, the European Council 
explicitly agreed that "the associated countries in central 
and eastern Europe that so desire shall become members 
of the European Union. Accession will take place as soon 
as an associated country is able to assume the obligations 
of membership by satisfying the economic and political 
conditions required". 
Under the Agreements, the partner countries commit 
themselves to approximating their legislation, particularly 
in the areas relevant to the internal market, to that of the 
European Community. 
One of the key elements of the Europe Agreements is the 
Association Councils. These are a series of bilateral 
meetings between the European Communities, their 
Member States and each of the partner countries. During 
1995, these Association Councils have concentrated on 
the implementation of the pre-accession strategy and 
regional cooperation. 
The Association Councils are complemented by 
Association Committees, which review all areas under the 
Europe Agreements, and the Joint Parliamentary 
Committees. 
Structured dialogue 
The second instrument of the pre-accession strategy is the 
'structured dialogue'. Dialogue has always been a cornerstone of the European Community's cooperation 
with the central European countries. As they emerged 
from decades of isolation from the rest of Europe, it 
played an essential part in bringing about an improved 
understanding of their requirements and interests. 
The Copenhagen European Council in June 1993 agreed 
on a multilateral framework of regular meetings at 
ministerial level between the Union and the partner 
countries. This framework was endorsed at Essen, where 
the specific arrangements of the structured dialogue were 
set out. 
The structured dialogue fulfils an essential role in 
preparing the partner countries for membership of the 
Union, enabling discussion of issues of common concern, 
in areas where solutions require action at European level. 
The areas of policy range from cultural cooperation to the 
Common Foreign and Security Policy (CFSP). 
The discussion of issues of common concern also allows 
prospective members to become more involved in the 
European Union's activities before accession negotiations 
begin and more familiar with the institutions of the 
European Union and how they function. As a result, the 
structured dialogue enhances the close working 
relationship essential to the European integration process. 
The heads of government of the partner countries were 
invited to the European Councils at Cannes and Madrid. 
Ministers also met to discuss a wide range of issues with a 
trans-European angle, such as telecommunications, 
transport, environment and scientific research, as well as 
other matters related to the European Community's 
internal market. In the field of justice and home affairs, 
cooperation has focused on the fight against organised 
crime. 
A new focus for Phare 
Developed initially as an immediate response to the 
challenges facing the central European countries, the 
Phare Programme is now also the financial instrument of 
the pre-accession strategy. 
The pre-accession strategy, as outlined at the Essen 
Council, states that "integration will be supported by the 
European Union's Phare Programme which will develop 
on an indicative basis into a medium-term financial 
instrument with improved possibilities to promote 
infrastructure development and intra-regional 
cooperation". 
In concrete terms, this means that Phare is devoting a 
greater share of its funds to the co-financing of 
infrastructure development projects and to promoting 
cross-border cooperation. Phare is also introducing 
measures to promote cooperation between the partner 
countries and to place a greater emphasis on investment 
support. 
To prepare the partner countries for participation in the 
internal market, it was decided to support their efforts to 
harmonise their legislation, standards and norms with 
those existing within the European Community. This will 
involve the provision of significant support for the system 
of public administration to ensure that the necessary 
legislation can be implemented effectively. 
In its progress report on the pre-accession strategy which 
it submitted to the European Council in December 1995, 
the European Commission stated that further emphasis 
still needed to be placed on support for investment and 
infrastructure. It also stated that Phare would also be 
supporting a number of projects in the area of justice and 
home affairs. 
In order to increase the efficiency of the Phare 
Programme, the European Commission coordinates its 
assistance activities with the other donors supporting the 
central European countries, such as the European Bank for 
Reconstruction and Development (EBRD) or the World 
Bank. Emphasis is given to particular sectors in order to 
heighten the impact of assistance. The Cannes European Council 
The European Commission, in accordance with the 
conclusions of the Essen summit, presented its White 
Paper on the preparation of the partner countries for 
integration into the internal market of the European 
Community. The Cannes European Council concluded 
that "the preparation of the associated countries for 
integration into the internal market is, as was affirmed by 
the Essen European Council, the main element of the 
strategy of preparation for accession." 
The Council also agreed to an increase in the 
Programme's financial envelope until 1999. The Phare 
budget will rise from ECU 1,154 million in 1995 to ECU 
1,634 million in 1999, a total of ECU 6,693 million over 
the period, thereby reinforcing the commitment of the 
European Union to accession. 
Before the publication of the White Paper, the partner 
countries had already begun approximating legislation and 
moving towards the economic freedoms on which the 
internal market is founded. However, with the prospect of 
full membership of the European Union moving closer, it 
was decided to produce a document which sets out the 
body of essential internal market legislation. 
Phare funding is already being used for the 
implementation of the White Paper. Above all, this is a 
technical manual which forms a key element of the pre-
accession strategy. As it guides the partner countries 
through the legislation, structures and broad economic 
conditions essential to the functioning of the internal 
market, the White Paper's purpose is to clarify the task of 
approximating national laws to those of the European 
Union. 
For each of the twenty-three sectors of internal market 
legislation, the White Paper proposes a logical sequence in 
which to tackle the approximation exercise. While it is 
considered vital to lay down priorities for action, it is the 
countries themselves who identify those areas where the 
greatest impact will be achieved. 
The White Paper marks the beginning of a process in 
which the partner countries play the leading role. The task 
of enacting, implementing and enforcing the necessary 
laws can be carried out only by the partner countries 
themselves. Support will be provided by the European 
Union and its Member States, but it is important that this 
is coordinated so that the provision of assistance is both 
efficient and effective. 
It is for this reason that the White Paper recommended 
that the Commission sets up and manages a Technical 
Assistance Information Exchange Office. This is being 
supported by the Phare multi-country programme and will 
be the focal point for the provision of advice and expertise 
on legislation and the necessary implementation 
structures. It will house an internal market database 
through which all interested parties will have access to 
information concerning the support available under Phare 
and other European Union programmes. It will also serve 
as a clearing house, matching requests for support from 
the partner countries with specialists and programmes 
available at national and European levels. In this way, the 
Office will direct support provided by Phare and by the 
various other public and private sector sources, towards 
the needs of the partner countries. 
Madrid Council and enlargement 
In December 1995, at the Madrid summit, the European 
Commission submitted its study on alternative strategies 
for the development of relations in the field of agriculture 
between the European Community and the partner countries. The Commission also presented reports on the 
progress made in the pre-accession strategy, and on the 
impact of enlargement on the European Union's policies. 
The Madrid Council announced that the European 
Union's intergovernmental conference (IGC) would begin 
in March 1996. While the conference will have no direct 
impact on the Phare Programme, it will shape the 
European Union's institutions for the next century. 
In the course of 1995, the following countries made 
official applications for full membership of the European 
Union: Bulgaria, Estonia, Latvia, Lithuania, Romania and 
Slovakia. Poland and Hungary applied in 1994. The Czech 
Republic decided to wait until the beginning of 1996, 
while Slovenia submitted its application in June 1996. 
The Madrid Council "hopes that the preliminary stage of 
negotiations will coincide with the start of negotiations 
with Cyprus and Malta". These should begin six months 
after the conclusion of the IGC, which is due to finish in 
mid-1997. 
Phare in 1995 
1995 was a year of both continuity and change for the 
Phare Programme. In many areas, the Programme 
continued the work started in 1994. This meant that 
infrastructure projects continued to be of great importance, 
the cross-border cooperation programme gained 
momentum, and Phare continued to provide know-how 
and grant finance to its partner countries. 
In other areas, however, Phare made some fundamental 
changes. The new role as the financial instrument of the 
pre-accession strategy, and the challenge that this 
represented, meant that Phare had to modify its 
organisational structure, while continuing to improve its 
programming process, create a new monitoring structure 
and enhance its financial management. 
The following sections outline both the changes which 
Phare made in 1995 and the areas in which it continued to 
concentrate its efforts. Concentration on infrastructure investment 
In 1995, Phare continued to concentrate on infrastructure 
projects and intensified the work begun in 1994. The 
Essen European Council in December 1994 recognised 
the increasing importance of Phare's work in this area by 
increasing the limit of Phare spending allowed on 
infrastructure to 25 per cent from a previous level of 15 
per cent. This increased the Programme's ability to play a 
complementary role to its traditional provision of know-
how by providing targeted grant funds in key areas. 
In practice, this means that Phare has been able to unblock 
projects which may otherwise have stalled, by providing a 
financing bridge between International Financial 
Institutions or private sector investors and the 
governments of the partner countries. Phare's investment 
in infrastructure is subject to a number of ground rules. 
The most important of these are that 
• the project must be a stated priority for the partner 
country. This is in line with the spirit of the pre-
accession strategy which places the responsibility for 
determining the priorities along the road to accession 
with the partner countries themselves. The partner 
country is therefore required to contribute counterpart 
funds itself to the project. 
• Phare's contribution must bring a clear additional 
benefit to the project which would not otherwise be 
present. This might include, amongst others, 
unblocking a high priority project which cannot go 
ahead because a country is unwilling to support a 
project where the costs are concentrated in its own 
areas but the benefits span several countries; or where 
Phare's money would attract additional commercial 
finance through the multiplier effect. 
• Phare's contribution must complement and not 
compete with the normal actors in this area, such as the 
partner country governments, private operators, 
commercial lenders and the International Financial 
Institutions. 
. the project must be supported by an overall strategy 
which is in line with European Union standards. 
Phare's infrastructure investment in 1995 has continued to 
concentrate on the areas of transport, the environment, 
energy, telecommunications and private sector 
development. In particular it has been focused on two 
broad but critical areas. The first of these are trans-
European networks, recognised as a priority sector in the 
1992 Maastricht Treaty and still an integral requirement of 
an effective internal market. This caused a number of 
infrastructure improvements to be identified in 1995, 
including roads and railways linking Berlin and Warsaw; 
Dresden and Prague; Nuremberg and Prague; Trieste, 
Ljubljana and Budapest; a telematic platform in the Baltic 
Sea and a Baltic ring electricity network. 
The second area concerns projects which assist the 
countries of central Europe in the transition from a 
centrally-planned economy to a market economy. In the 
area of transport, this has included the restructuring and 
modernisation of both road and rail networks, the 
elimination of border crossing bottlenecks, and the 
development of traffic management systems. Environmental projects have also been identified which 
tackle regional 'hot spots' in air and water pollution, 
especially where there is a cross-border impact. Other 
areas include projects of nature conservation such as 
coastal zone and wetlands management, environmental 
projects which have immediate health benefits such as the 
clean-up of rural water supplies or industrial and military 
sites, and the introduction of cleaner technologies. 
In the field of energy, infrastructure projects which have 
received Phare investment include the environmental and 
safety upgrading of power plants, projects aimed at 
increasing energy efficiency and renewable energy, and 
local projects with clear environmental benefits. 
Finally, Phare has helped to fund the development of rural 
telephony pilot projects - a significant step towards 
creating the communications infrastructure vital in today's 
global business environment. 
Cross-border cooperation 
The Phare cross-border programme, established in 1994 at 
the initiative of the European Parliament, continued to 
play an essential part in the pre-accession strategy. 
Whereas in 1994 efforts focused on the creation or 
adaptation of the necessary institutional framework for the 
communication, programming, implementation and 
monitoring of the programme, 1995 saw a number of 
concrete steps being taken. 
Phare worked closely with Directorate General for 
Regional Policies, which manages INTERREG, in order 
to ensure coherence with regional cooperation aims and 
practices. Commission Regulation N° 1628/94 on cross-
border cooperation between the Member States and the 
central European countries in the framework of the Phare 
Programme, provides the rules for financing actions of a 
structural nature in border regions of central European 
countries sharing a common border with Member States, 
in harmony with the European Union structural policies, 
and with INTERREG II in particular. Joint Programming 
and Monitoring Committees composed of the appropriate 
authorities from both sides play the principal role in 
assuring overall coordination in the planning and 
implementation stages, and in monitoring the programmes 
selected. 
Although the bulk of the Phare cross-border cooperation 
projects have focused on the development of 
infrastructure, transport, telecommunications and energy, 
the new approach adopted for 1995-1999 will include 
more "soft" actions such as tourism, human resources and 
culture. This has been underpinned by the setting up of a 
Small Project Fund Facility. 
In 1994, the central European countries eligible for 
participation were Albania, Bulgaria, the Baltic states, the 
Czech Republic, Poland and Slovenia. In 1995, Hungary 
and Slovakia were added to the list (owing to Austria's 
accession to the European Union) as well as new border 
regions in the Czech Republic and Slovenia. The eligible 
border regions were determined by the partner countries 
themselves in collaboration with the European 
Commission in order to ensure coherence with 
INTERREG. 
In 1995 the Phare Management Committee gave a 
favourable opinion on cross-border projects for Albania, 
Bulgaria, the Czech Republic, Estonia, Hungary, Latvia, 
Lithuania, Poland, Slovakia and Slovenia. These projects 
mainly concerned transport, environment, agriculture, 
human resources and economic development and a budget 
of ECU 169 million was agreed. 
Sectoral cooperation programmes regarding the 
environment and interregional cooperation were also 
given a favourable opinion. This type of programme 
involves funding from an International Financial 
Institution and/or a European Union Member State. Phare 
provides for the necessary support during the project 
appraisal and preparation period as well as its 
implementation. A wide range of measures is eligible, 
such as the abatement of air pollution, waste water 
management and minimising the environmental effects of 
transport projects. 
As for the interregional cooperation programme, already 
built upon the ECOS and Ouverture instruments of the 
European Union, it is the first time funding has been 
provided for cities and regions in all Phare partner 
countries and those of the European Union. Over 100 
interregional cooperation projects are being funded. 
Looking to the future, as the countries of central Europe 
come closer to integration, the Phare cross-border 
cooperation programme will shift from infrastructure 
project implementation and evaluation, towards increased 
training, administration and development of socio­economic structures. This will allow the programme to 
respond better to the needs of the integration process. 
Opening of Community programmes 
In 1993, at the Copenhagen Summit, heads of the Member 
States took the political decision to offer to the associated 
central European countries the possiblity of participating 
in Community programmes. 
On 4 December 1995, the Commission and the Council, in 
agreement with the European Parliament, concluded 
Additional Protocols to the Europe Agreements with 
Bulgaria, the Czech Republic, Hungary, Poland, and 
Romania in order to provide the necessary legal 
framework for their participation in these programmes. An 
Additional Protocol was also signed with Slovakia, 
pending the European Parliament's agreement. The 
additional protocols for the Baltic states are integrated into 
the Europe Agreements with each country. 
This will allow the partner countries to participate in the 
Socrates, Leonardo, and Youth for Europe III 
programmes. It will also allow those countries whose 
audiovisual legislation is compatible with European 
Community law to participate in the Media II programme. 
Other programmes covering the fields of culture, 
environment, health, energy and the internal market will 
have to be adapted in order to take into account future 
participation by the central European countries. Corine 
(satellite mapping), LIFE (environment), SAVE II (energy 
efficiency) and Synergy (energy cooperation) are 
examples of programmes which have been designed for, 
or extended to, the central European countries. 
In 1995, a budget of ECU 9.9 million was committed for 
the preparation of the associated countries' participation 
through information sessions, visits and training for 
national administrators, the transmission of the necessary 
documentation, and establishment of the appropriate 
national structures or information offices for the purposes 
of acquiring a better understanding of these programmes. 
Specific programmes under the Fourth Framework 
Programme for Research and Development have also been 
opened under certain conditions to the partner countries. 
Coordination with other donors 
In order to increase the efficiency of European 
Community assistance, and particularly that of the Phare 
Programme, the European Commission coordinates its 
assistance activities with the other donors supporting the 
central European countries. Since the G7 summit of heads 
of state and government held in Paris in July 1989, the 
Commission has the official task of coordinating the 
activities of all those donors. 
In this capacity, and given the importance of Phare, the 
Commission works closely with the G-24 countries, as 
well as the International Financial Institutions such as the 
World Bank, the European Bank for Reconstruction and 
Development (EBRD), the European Investment Bank 
(EIB) and the Organisation for Economic Cooperation and 
Development (OECD). 
Phare and the OECD have collaborated, for example, on 
the SIGMA programme (Support for Improvement in 
Governance and Management in central and eastern 
Europe). SIGMA provides support to the partner countries 
to develop coherent reform strategies and efficient public 
institutions. An example of Phare/EBRD co-financing is 
the environment project preparation facility, a horizontal 
programme launched at the end of 1995 which facilitates 
the implementation of critical environmental projects in 
the central European countries. 
In March 1995, at the High Level meeting, the G-24 
donors together analysed the reforms undertaken during 
the first five years of transition in central Europe. The 
general conclusion was that this transition is irreversible. 
The donor organisations committed themselves to 
continuing active support for the integration of the central 
European countries into the international economic 
community. Moreover, their assistance will be designed to 
fit into and enhance the pre-accession strategy. 
With these objectives in mind, the European 
Commission's coordination work will be strengthened on 
the ground, in the partner countries, with emphasis being 
given to distinct sectors in order to heighten impact. The 
organisations will work together at programme and project 
level. objectives were to identify the needs of the country in its 
task of reconstruction, and to mobilise the donors' 
assistance. Above all, this illustrates the concrete support 
given by the European Union to the peace process, and its 
role as the world community's aid coordinator for central 
Europe. 
Phare and former Yugoslavia 
1995 marked the year in which reconstruction of the 
former Yugoslavia began. The financing plan approved by 
the European Commission for support to the peace 
process allocated ECU 600 million, to be spent over the 
period 1996-99. 
Likewise, in the light of the Dayton peace agreement, 
reached in December 1995, it was of utmost importance 
that the short and medium-term reconstruction of Bosnia-
Herzegovina start as quickly as possible. A number of 
international institutions, notably the World Bank, the 
International Monetary Fund (IMF), the European Bank 
for Reconstruction and Development (EBRD), and the 
European Community prepared a programme for that 
purpose. The first phase of the Phare Essential Aid 
Programme was elaborated on the basis of the multilateral 
plan, and a first tranche of aid worth ECU 62.5 million 
was due to be launched immediately in January 1996. 
The Court of Auditors 
In November 1995, the Court of Auditors delivered its 
report on the financial and operational performance of the 
European Commission during 1994. The Court recognised 
that the efforts made by Phare management had led to a 
number of improvements in the Programme. 
The Court did, however, highlight scope for further 
improvement, in particular better use of the PHACSY 
financial reporting system; greater rigour in the tendering 
process; and a more operational use of the results of 
studies conducted using Phare funds, especially to 
encourage real investments. 
In 1995, the profile of foreign-aid coordination was raised 
in the public eye. The peace agreement reached by the 
republics of the former Yugoslavia requires the support of 
the international community. In December 1995, the 
European Commission and the World Bank organised the 
first meeting of donors for Bosnia-Herzegovina. The key As outlined in the section below, both the financial 
management systems and the operational procedures for 
Phare were already being reviewed during the course of 
1995 and improved. A new monitoring unit was also 
established. 
Operational management of Phare 
Since its inception Phare has sought to involve its partner 
countries as much as possible in the strategic and 
operational activities of the Programme. It has, therefore, 
adapted its structure over time to accommodate the 
changing needs of its partners, to increase cooperation and 
coordination between the Commission and the countries, 
and to heighten the impact of the programmes carried out 
within the Phare framework. 
This process of operational improvement continued in 
1995. The internal structure of the Directorate and the 
management of the Programme were changed so as to 
forge closer links between work on Phare, the Europe 
Agreements and the pre-accession strategy. 
Management processes were improved. The financial and 
management reporting systems were overhauled, and the 
number of standardised and regular independent audits 
increased. A stand-alone monitoring and assessment unit 
was created with the intention of improving the 
operational quality of Phare programmes and ensuring a 
more cost-effective use of funds. This will support the 
process of decentralisation which is increasing in 
importance as the pre-accession strategy runs its course. 
Finally, the emphasis on increasing openness in the Phare 
Programme was maintained through a targeted 
communications programme to other European Union 
institutions, European Union Member States - notably the 
public services and commercial sectors - and partner 
countries. 
Operational structure 
The Directorate which manages the Phare Programme 
within Directorate General IA (Europe and the New 
Independent States, Common Foreign and Security Policy 
and External Missions) was reorganised in 1995. 
Up until this point, the Phare service had been organised 
largely on a sector basis, with staff divided into sectoral 
units such as agriculture or infrastructure. It became clear, 
however, that an integrated geographical structure was 
needed to reflect the needs of the pre-accession strategy 
and the Europe Agreements, and the structured 
relationship and financial cooperation which were critical 
to its success. 
Therefore, in July 1995, the Commission reorganised the 
Directorate responsible for Phare on a country by country 
basis. Three geographical units were created, with responsibility for all aspects of relations with the central 
European countries. This was designed to focus on all 
aspects of each country's pre-accession needs at the same 
time as improving the performance of the Programme by 
enabling a faster, co-ordinated response to country issues, 
and operational synergy between the Delegations in the 
partner countries and staff in Brussels. 
Many Phare programmes do, however, involve several 
partner countries. So as not to lose the overview necessary 
to manage these, separate horizontal and sectoral units 
were created with responsibility for policy coordination 
and the management of multicountry and horizontal 
programmes. These ensure that cooperation between 
countries is maintained and that opportunities for 
synergies are identified and implemented. 
The Directorate began to work on this new geographical 
basis from June 1995 onwards so as not to lose the 
momentum created by the Essen and Cannes Councils and 
the launch of the pre-accession strategy. 
Phare also launched an initiative to address the issue of 
staff, both at Headquarters in Brussels and in the 
Delegations. Studies are underway to identify those tasks 
which are core to managing the Phare Programme, which 
fall within the executive competence of Commission 
service, and which will therefore need to be carried out by 
Commission staff. Other tasks identified as non-core can 
then be contracted out, thereby using existing staff in the 
most efficient way. 
A new programming approach 
1995 saw the streamlining and improvement of the Phare 
programming approach. The Essen and Cannes Councils 
had provided a clearer definition of common objectives 
and the opportunity therefore to target funds more 
effectively. They had also provided Phare with a multi-
annual financial horizon with the intention that the 
Programme be allied more closely with the medium term 
strategic ambitions of the partner countries. 
This resulted in new, multi-annual indicative programmes 
being prepared in 1995 for four countries (the Czech 
Republic, Hungary, Poland and Slovakia), with multi-
annual indicative programmes planned for the other Phare 
countries by the middle of 1996. These are prepared in 
partnership with the countries concerned and cover the 
period up until and including 1999. They lay out for each 
of the countries its objectives, priority sectors, activities 
10 
and timeframes, including an indication of funds to be 
allocated to each sector. Multi-annual indicative 
programmes were produced for eleven cross-border 
programmes, covering all partner countries except 
Romania. 
This new approach has benefits for both the partner 
countries and the Member States. For the partner 
countries, it brings accession into a sharper focus, 
provides a series of concrete objectives, and allows them 
to build the Phare Programme into their medium term 
restructuring programmes and strategies for accession. For 
the Member States, it gives them an opportunity to make a 
strategic contribution and to take a longer, more 
comprehensive view of each country's Phare priorities. 
Whilst the multi-annual indicative programmes have 
given Phare a medium-term perspective, it should be 
remembered that the implementation of the programmes 
remains subject to an annual budgetary procedure. This 
means that the allocation of funds which appears in the 
multi-annual programme is purely indicative and therefore 
only a statement of intent. Each year, the Commission 
allocates the appropriate funds to each country based on a 
country operational programme which includes all the 
programme components in one document. This is based 
on the multi-annual indicative programme, but need not 
faithfully reproduce it. This allows an additional flexibility 
to both the country and Phare, should circumstances or 
priorities change. 
Nevertheless, the introduction of multi-annual indicative 
programmes has eased the pressure caused by the annual 
programming round, has cut down the time lag between 
commitment, contracting and payment, and significantly 
simplified the programming process. 
Changes in implementation 
Implementation is the most critical area of Phare 
programmes. The ability to manage the individual projects 
on the ground determines the degree of their impact and 
thus the effectiveness of the use of public money. 
Certain limits are set by the Council's financial regulation, 
attributing full responsibility for the use of funds to the 
Commission, thus limiting the extent to which 
responsibility can be delegated to the partner countries. 
Nevertheless, 1995 saw continued attempts to reconcile 
this potential conflict and to arrive at an implementation 
process which was both effective and stringent. Further progress was made in 1995 towards the 
decentralisation of the implementation process. This was 
started in 1994 with the publication of the Decentralised 
Implementation System manuals, a response to the need 
for a common operating system across the whole 
Programme and an attempt to reconcile the management 
skills and habits of partner administrations with respect for 
the Phare Regulation. 
During 1995, further work was done, in conjunction with 
the partner countries, on improving the Decentralised 
Implementation System. This concentrated on 
. simplifying the programming approach, with special 
attempts to reduce the overall workload by establishing 
a closer link between the documents needed for both 
programming and implementation. This will reduce 
duplication of effort. 
• transferring implementation responsibility at the two 
most important levels - firstly, from the Commission to 
the partner country, and secondly, from Phare staff in 
Brussels to Commission staff in the country 
delegations. In practice this will mean a gradual 
transfer from ex ante approval to ex post monitoring 
and assessment, without sacrificing the overall 
supervisory responsibility of the Commission. 
• clearly defining the roles and responsibilities of the 
main implementation players, particularly the Brussels 
headquarters and the Delegations. This has involved 
agreeing job descriptions which again will reduce 
duplication of effort, allow more efficient use to be 
made of the resources available and increase the levels 
of understanding between the teams. 
Work was also done in 1995 on making the Decentralised 
Implementation System manuals themselves more 
accessible and user friendly. These will be reissued, 
covering all the new procedures, in 1996 and be backed up 
by additional training for the Delegations and the 
Programme Management Units. 
Financial management 
The complexity and range of the Phare Programme, 
combined with the Commission's responsibilities for 
supervision, require a sophisticated financial management 
system. Launched in 1994, the PHACSY system was 
designed to gather all programming information directly 
from the Programme Management Units, and to use this 
as a monitoring tool. PHACSY was refined in early 1995 
and reissued in a new, more user-friendly format. 
Prior to this it was merged with Desiree, the main Phare 
information database, which was in turn fully integrated 
with SINCOM, the financial management system of the 
entire Commission. This has made the financial 
management process for Phare more streamlined and 
accurate, has reduced duplication and wasted effort, and 
has extended the reach of the system among PMUs. By 
the end of 1995, about 95% of all available management 
information from PMUs was contained in PHACSY and 
efforts will be made in 1996 to obtain the remaining 
information. This has been supported by the increased 
number of independent financial audits in 1995 which will 
continue into 1996. 
Monitoring and assessment 
Crucial to the process of ensuring greater decentralisation 
while maintaining the Commission's responsibilities is the 
creation of an effective monitoring and assessment 
system. When the Directorate responsible for Phare was 
restructured in 1995, a new unit was created with specific 
responsibility for monitoring and assessment. 
The unit is responsible for the implementation of a 
monitoring and assessment system which will be 
independent, credible and based on the principle of 
common ownership and involvement of the partner 
countries. In doing so, it was asked to move to a standard 
system which could be widely applied across all Phare 
projects. 
In 1995, the foundations were put in place for the new 
monitoring and assessment system. A regional structure 
was created, with three regional offices staffed with 
independent consultants from the European Union and 
local experts. It is planned that these offices will become 
fully operational in the first half of 1996 and that over four 
hundred projects will be both monitored and assessed each 
year. 
The process developed is primarily an operational tool for 
all those involved in the Phare Programme. By providing 
a regular assessment of the status and progress of Phare 
projects, the new unit will be able to identify and share 
best practice across all the partner countries, pinpoint 
poorly performing projects and suggest remedial action, 
and provide rapid feedback to those designing future 
programmes. As the monitoring and assessment system has been designed to dovetail with the regular 
programming process, the information will allow 
programmes to be adapted more closely to the needs of 
the partner countries. 
Communications 
Since 1993, Phare has actively responded to increasing 
interest shown by European Community institutions and 
advisory bodies, Member States and partner countries in 
the Programme. 
In 1995, Phare spent ECU 3.2 million on 
communications. It published 67 separate titles in 18 
languages and distributed over 800,000 copies in 26 
countries. The Information Unit responded to over 60,000 
telephone enquiries, letters and faxes, and about 5,000 
personal visits. Information Unit staff also made over 100 
speeches and presentations on the Phare Programme to 
conferences and workshops, mainly in the Member States. 
In 1995, the research programme was continued in 
partner countries to identify and find appropriate 
mechanisms to satisfy people's information needs. 
Delegation information programmes became much more 
focused on communicating with decision-makers and 
opinion-formers about pre-accession and what it may 
mean to join the European Union. These programmes 
include local-language publications, media relations, the 
development and implementation of contact programmes, 
and the creation of local communications databases. The 
bimonthly "European Dialogue" magazine was launched 
and, by the beginning of 1996, was being mailed in six 
centra] European languages to 20,000 decision-makers 
and opinion-formers in the region. Specific communi­
cations programmes were launched in the Czech 
Republic, Hungary, Poland and Slovakia. Television 
documentaries about the European Union began 
appearing increasingly in the partner countries to give 
more information about the Union to the general public 
as well. 
Contracts were also drawn up during 1995 to launch a 
Phare 'on-line' information service on the Internet. This 
will provide contract information, access to the Phare 
address book, and other general information on Phare. It 
will also give people an opportunity to communicate 
easily with Phare through an e-mail facility. This will be a 
further step forward for Phare's communication 
programme, will lead to greater speed of access to 
information, and will make the communications process 
more efficient and cost effective. 
12 
Albania 
The Albanian economy has begun to recover from the 
collapse of an economic system whose closed and 
centrally-planned structure was more pronounced than 
that of other former communist countries. In 1995, it 
achieved one of the highest growth rates (11.3 per cent) of 
all the central European countries. Inflation fell to 6.0 per 
cent, a result of a disciplined monetary policy, and 
unemployment also dropped to 14 per cent. The 
privatisation process is on track, with all the remaining 
state enterprises being transformed into joint-stock 
companies in April 1995. This has made possible a mass-
privatisation programme which will begin in 1996. 
During 1995, progress was also made towards bringing 
Albanian institutions and laws closer to those of the 
European Union's standards. New civil, penal and labour 
codes were adopted resulting in a more robust judicial 
framework. Albania also signed the convention of the 
Council of Europe for the protection of minorities and was 
granted full membership of the Council in July 1995. 
In 1995, Phare continued to provide considerable support 
to Albania's progress towards reform. Albania is no 
longer dependent on essential aid and therefore Phare's 
focus within the country has evolved to reflect the 
country's considerable economic improvement. 
ECU 35 million was therefore allocated through the 1995 
indicative programme for the development of 
. the transport, telecommunications and energy sectors 
. an effective higher education system through the 
Tempus programme 
. local community infrastructure through the Albanian 
Development Fund 
• the private sector, public administration and judicial 
systems. 
Within this, Phare's priorities in 1995 shifted from the 
agricultural sector towards infrastructure development, 
particularly roads and ports, telecommunications and 
energy. Development in these areas is essential if Albania 
is to participate fully in the single market. The main 
infrastructure priority for 1995 was the rebuilding and 
upgrading of the East-West corridor. This meant that 
Phare financed, together with the European Investment 
Bank, the following projects 
• upgrading of the Durres-Elbasan and Pogradec-
Kapshtica sections (a total of 146 km) of the East-West 
corridor 
. developing the Durres ferry terminal. Funds allocated by sector 1995 
ECU 88 million 
Education, training 
and research 3.5 
Financial sector 35 
Infrastructure 
(energy, transport, 
telecom.) 34 
These projects demonstrate the important role Phare can 
play in unlocking funds from other international financing 
institutions. 
In other areas, Phare also played a leading role. Work has 
been done on improving primary healthcare and 
developing hospitals, programmes have been set up to 
strengthen local government, and measures have been 
taken to channel funds directly to small-scale projects 
which will have a direct and beneficial impact on local 
communities. Phare will also continue to support the 
energy sector, placing emphasis on the preparation of a 
national strategy, policy and legislative framework and the 
provision of pre-investment studies in key areas. 
Absorption capacity of the Phare Programme in Albania 
continued to be satisfactory with around 73 per cent of 
total committed Phare funds contracted by the end of 
1995. Nevertheless, the increased emphasis on 
infrastructure projects which require longer periods of 
preparation as well as more complex tendering processes, 
coupled with the logistical limitations on the pace of land 
registration and the inability of the banking sector to 
provide the necessary credit lines when needed, have 
resulted in some slowing down in implementation and 
payment during 1995. 
Looking forward, the stable economy will allow the Phare 
Programme in Albania to plan for the longer term and a 
multi-annual indicative programme covering the period 
1996 to 1999 is being developed. Albania also hopes to 
make progress towards its goal of association with the 
European Union. In March 1995 Albania made a formal 
request to open negotiations for a specific agreement. 
13 
Bulgaria 
Bulgaria's social and economic transformation has not 
been easy. The changes in government, combined with 
varying levels of parliamentary support, resulted in 
relatively slow decision-making in key areas of structural 
reform. In addition, the collapse of the Comecon markets, 
the Gulf crisis, and the UN sanctions against former 
Yugoslavia also affected economic growth. Nevertheless, 
the basis for a market economy has been created and the 
foundations have been laid for a democratic and civil 
society. 
In 1995, the economic improvement begun in 1994 
continued. Gross Domestic Product grew by 2.5 per cent, 
inflation and unemployment fell and privatisation 
progressed. This, plus a greater political stability, created a 
more constructive environment for the management of the 
Phare Programme in Bulgaria and programme 
management structures became more stable, and therefore 
more efficient. 
The 1995 Phare Programme supported projects in the 
following areas in Bulgaria for a total of ECU 60 million Funds allocated by sector in 1995 
ECU 83 million 
the approximation of legislation 
the promotion of private agriculture 
human resources development 
transport development 
energy and nuclear safety. 
Phare provided ECU 5 million in 1995 for a number of 
agricultural projects. These included policy support to the 
Ministry of Agriculture and Food Industry, registering and 
restoring historic land ownership rights and other 
transactions, restructuring and privatising state-owned 
industries, and the development of production and marketing 
structures. 
In the area of education, Phare continued to support the 
Tempus programme for the reform of higher education. 
Based on a 1993 pilot project, a programme was started 
for the development of post-secondary vocational training 
and the financial management of secondary education. 
The programme also supported the creation of a higher 
education accreditation and assessment agency. Infrastructure 
(energy, transport, 
telecom.) 48 Education, training 
and research 21 
Environment and 
nuclear safety 7 
The 1995 transport programme confinanced, with the 
European Bank for Reconstruction and Development and 
the World Bank, a major project for railway rehabilitation 
(approximately 400 km). It also supported the 
restructuring of the Sofia urban transport system. 
In the energy sector, Phare supported the improvement of 
energy efficiency (electricity, district heating and gas), 
pre-investment studies and measures to promote the 
introduction of the 'acquis communautaire'. 
In 1995, a multi-annual indicative programme for cross-
border cooperation with Greece was also approved. 
Covering the period 1995-1999, the programme was 
allocated an indicative budget of ECU 115 million. Set 
against the background of good bilateral relations between 
the two countries, the programme will support the 
development of Bulgaria's border regions with Greece, 
within the overall Bulgarian policy of regional co­
operation. Key areas of work are transport, environment, 
economic development and human resources. 
A closer monitoring of programme implementation 
enabled occasional problems and delays to be identified at 
an early stage and remedied, and political stability has 
allowed medium-term planning to be considered. 
14 
As a result, part of the backlog of uncommitted funds 
dating from previous years was cleared and the overall 
contracting rate increased from 48 per cent in 1994 to 56 
percent in 1995. 
The 1995 programme for the approximation of laws 
aimed at developing a comprehensive match between 
Bulgarian and European Community legislation. 
Accordingly, Phare assisted with the drafting of new laws 
and provided training to target groups in the public 
administration as well as the judiciary. It is also intended 
that the programme will draw on the information and 
experts made available by the Technical Assistance 
Information Exchange Office, established in Brussels in 
1996. In February 1995, the Europe Agreement with the 
European Communities and their Member States came 
into force and the first Association Council was held in 
May 1995, at which the two parties discussed Bulgaria's 
progress within the pre-accession strategy. Phare is the 
main instrument to support that strategy. 
In December 1995, Bulgaria submitted its official 
application for membership. The government has declared 
European integration to be among its main priorities and 
has established an inter-ministerial European integration 
structure. 
15 
Czech Republic 
1995 was the year when the country's Europe Agreement 
with the European Union came into force, and the national 
economy continued the substantial progress already made. 
In the same year, the country was the first from central 
Europe to be accepted, as of 1 January 1996, into the 
Organisation for Economic Cooperation and Development 
(OECD), a move which endorsed the economic reforms 
carried out by the Czech government. 
The continued policy mix of macroeconomic stabilisation 
and, on the microeconomic level, price liberalisation, 
deregulation and privatisation enjoyed positive results. 
Growth was strong and unemployment, at 3.5 per cent, 
was low. In 1995, the koruna, the national currency, was 
made fully convertible. 
The entry into force of the Europe Agreement meant that 
the Czech Republic could take part fully in the 'structured 
dialogue' with the European Union. Within this 
framework the first Association Council took place in 
April 1995, and the first meeting of the Joint 
Parliamentary Committee in May where the White Paper 
on the internal market was discussed. 
In 1995, the Phare Programme in the Czech Republic took 
a new direction in the support it provides. As with the 
other associated countries, this new direction is 
characterised by the direct linkage of Phare to the 
preparation of the Czech Republic for membership of the 
European Union, with a special focus on improving the 
infrastructure in the areas bordering Germany and Austria 
and on strengthening the institutions central to the 
integration process and future membership. 
The Czech Republic was allocated a total of ECU 110 
million, including ECU 71 million for the 1995 country 
operational programme, together with ECU 8 million for 
the Tempus programme, and ECU 25 million and ECU 6 
million for cross-border cooperation with Germany and 
Austria respectively. Funds allocated by sector 1995 
ECU 110 million 
Social development Other 3 
and employment 2 Public institutions 
Private sector an<^ administrative reform 5 
support 1 
Infrastructure (energy 
transport, telecom.) 91 
The main focus of Phare during 1995 was the 
development of the Czech Republic's infrastructure. Phare 
has contributed to the construction of the Berlin-Decin-
Prague-Breclav-Vienna rail corridor and a number of 
infrastructure investment initiatives under the cross-border 
cooperation programme. It has also, since 1995, started to 
support socio-economic development and tourist projects 
in the border region, including the renovation of historical 
monuments. 
Since the accession of Austria to the European Union at 
the beginning of 1995, some 67 per cent of the Czech 
Republic's border is shared with member states of the 
European Union. This, plus the dramatic increase in road 
and rail traffic (particularly between the Czech Republic 
and Germany), has increased the focus on the border 
regions and the structural and environmental impact that is 
being made. 
Accordingly, the Phare cross-border cooperation 
programme is financing improvements to roads and 
railways, improving or creating new border crossings and 
introducing measures to reduce bottlenecks. Phare will 
also improve the quality of air and water in the regions by, 
amongst other projects, building new gas and steam 
pipelines, introducing environment-friendly technology in 
heat and power generation, improving sewage systems 
and building new water treatment plants to reduce river 
pollution and improve drinking-water standards. 
Phare has also contributed to the strengthening of Czech 
legislative and institutional capacity by financing expert 
assistance and training to Czech civil servants and by 
supporting the ministries and institutions central to the 
integration process, such as customs, statistics, industrial 
property, competition and standards administration. A 
considerable part of this effort has focused on assisting the 
Czechs to ensure the approximation of their laws with 
European Union legislation. Looking forward, the Phare multi-annual indicative 
programme for 1995-99 was signed and approved, with 
increasing emphasis placed on investment support and the 
use of Phare as a medium-term financial instrument. With 
a total budget of between ECU 300 million and ECU 330 
million, including cross-border cooperation, the indicative 
programme will be devoted to the following priority areas 
• legislative integration with the European Communities, 
with the ultimate goal of adopting the 'acquis 
communautaire' 
. infrastructure integration with the European Union, 
particularly in the fields of transport, energy and the 
environment 
• socio-economic development, including SME and 
export promotion, regional development, and 
promotion of foreign direct investment and social 
security reform. 
17 
Estonia 
Estonia has undergone a remarkable economic recovery in 
the past few years. In terms of trade liberalisation and the 
macroeconomic aspects of reform, the country is well 
advanced. This was reflected in GDP growth in 1995, 
with a six per cent increase being recorded for the second 
consecutive year. Importantly, foreign investment also 
remained at the high level achieved during the previous 
year. These results have been made possible by the 
substantial progress made in the area of structural reform. 
Two areas of the economy will, however, need special 
attention over the coming period: the relatively high level 
of inflation, and the trade deficit, which was running at 
approximately ECU 300 million at the end of the year. 
Estonia submitted its formal application for membership 
of the European Union in November 1995, and 
participates in the structured dialogue of the pre-accession 
strategy. In November, the European Union signed an 
agreement with Estonia to open a Delegation of the 
European Commission in Tallinn. 
The privatisation process was accelerated in 1995, helped 
by Phare's contribution to the Privatisation Agency. 
Though work remains to be done in the large, state-run 
enterprises, the privatisation of small enterprises is almost 
complete, with small and medium-size enterprises now 
accounting for over 40 per cent of employment. The 
privatisation of the economy was further helped by the 
Estonian government's efforts to create the legal 
framework for the national stock exchange, which is 
expected to open in the first half of 1996. 
Phare's focus in 1995 was to help Estonia build on its 
economic success and prepare itself for eventual accession 
to the European Union. Estonia's Europe Agreement was 
signed in June 1995, and now awaits ratification by all the 
European Union Member States. Estonia remains the only 
central European country not to have requested a 
transitional period within which to liberalise its trade 
policy. 
Phare funding for Estonia increased to ECU 24 million in 
1995. This brings the total amount committed to Estonia 
for the period 1991-1995 to ECU 68.5 million. Continued 
cooperation between the Estonian government and the 
Phare Programme has resulted in a steady increase in the 
amount of funds committed. Funds allocated by sector 1995 
ECU 24 million 
Social development 
and employment 2.9 Public institutions 
and administrative 
reform 2.8 
Private sector 
development and 
enterprise support 9.1 Education, training 
and research 4.2 
nfrastructure 
(energy, transport, 
telecom.) 5 
In the agricultural sector, Phare has continued to support 
planning processes, the development of rural credit 
facilities, land registration and land privatisation. In 
addition, Phare will focus on institutional and human 
resources development in the Ministry of Agriculture. 
This will help to improve the efficiency of agro-industries 
through the provision of professional advice to farmers, 
the training of advisors in farm and business analysis, and 
the provision of support for rural credit agencies. 
Phare also provided support during 1995 for the 
development of an energy strategy aimed at achieving 
greater energy efficiency; reducing the levels of pollution; 
investing in transport infrastructure; and reforming the 
social safety and health systems. 
Within the framework of the multi-annual indicative 
programme, which has been allocated a budget of ECU 84 
million for the period 1995-1999, Phare will focus on the 
following priority sectors 
• European integration 
• export development 
• regional development 
• public sector management 
development. and infrastructure 
It is planned that throughout the period the focus of the 
programmes will shift to both public and private 
investment, particularly in the areas of agricultural and 
regional development. The change in focus is partly 
intended to counterbalance the emphasis placed 
previously on urban development, but also to take account 
of the pre-accession strategy. 
18 
Hungary 
Among the first countries to benefit from Phare support, 
Hungary has established a system of democratic political 
institutions which enjoys general support from the 
country's main social and political forces, and has made a 
serious effort to develop harmonious relations with its 
neighbouring countries. 
Its history as the most market-oriented of the former 
Comecon countries also enabled Hungary to attract the 
largest inflow of foreign investment in the region (40.5% 
of the region's total in the 1989-94 period). Privatisation 
laws, aimed at speeding up the privatisation of state 
companies, were rapidly introduced and all the basic 
structures of a market economy have been established. 
Nevertheless, in 1995, the Hungarian government was 
faced with serious macroeconomic strains which led to the 
adoption of a stabilisation plan intended to reduce the 
budget and current account deficits and accelerate public 
finance reform. 
Phare's support in 1995, therefore, concentrated on 
supporting the government in its move towards further 
economic orthodoxy, and in helping Hungary achieve the 
pre-accession strategy measures outlined in the White 
Paper. Hungary was the first former communist country to 
submit its application for full membership of the European 
Union (April 1994), and the government's firm 
commitment to the pre-accession process has meant that 
Phare has placed a great deal of focus on supporting the 
harmonisation of legislation and restructuring the public 
administration. 
In practice this has meant providing sector and legal 
analyses, drafting new legislation and translating existing 
Community legislation into Hungarian, establishing 
necessary institutional structures, providing training 
sessions for public officials and other decision-makers, 
and organising public relations actions targeted at key 
target audiences. 
Another area of great importance is the transformation and 
reform of the Hungarian transport and communications 
infrastructure. In its current state it partly discourages 
domestic and foreign investment and contributes to the 
uneven economic development of different regions within 
the country. Phare is actively supporting the development 
of appropriate standards and is cofinancing, amongst 
others, infrastructural improvements, road building, 
railway lines and combined transport terminals. Funds allocated by sector 1995 
ECU 92 million 
Social development 
and employment 2 
Integrated regional 
measures 
Private sector 
development 
and enterpri 
support 6 Public institutions and 
administrative reform 3 
Infrastructure 
(energy, transport. Environment and 
nuclear safety 12 
In 1995 the Phare multi-annual indicative programme 
(1995-1999) was adopted to give support worth ECU 425 
million in the following priority areas 
• European integration, including approximation of laws 
and public administration reform 
• education and training with emphasis on the 
establishment of a human resources development fund 
• economic development, focusing on agriculture, 
privatisation and restructuring, small and medium-sized 
enterprises development, regional development, trade 
and investment promotion, tourism development 
• public finance and social sector reform 
• infrastructure development with emphasis on road and 
rail transport, communications, transit, water 
management, energy and the environment 
• participation in European Community programmes. 
For the year 1995, ECU 85 million was allocated to 
support these priorities. 
1995 also saw the first cross-border cooperation 
programme between Hungary and Austria. A multi-annual 
indicative cross-border cooperation programme, covering 
the period 1995-1999, has been agreed with the Hungarian 
authorities on the basis of their bilateral cooperation with 
Austria. 
19 
Latvia 
In 1995, Latvia once again enjoyed a substantial 
improvement in the economy, following the recession in 
the early 1990s. Economic growth was particularly strong 
in the service, construction and forestry sectors although, 
as a result of necessary restructuring, both the industrial 
and agricultural sectors continued to decline. 
Efforts to privatise small and medium-sized enterprises 
proved successful in 1995, although progress has been 
much slower with regard to larger enterprises. The process 
has been supported by the creation of a single national 
privatisation agency. The agency will progressively tender 
the remaining state-owned companies over the course of 
the next few years, and in the meantime enterprises still in 
the public sector will be managed by a State Property 
Fund. 
In the area of private sector development, Latvia still 
needs to complete and simplify the legal basis which is 
essential for attracting investment. Phare has been 
providing assistance both to the Latvian Privatisation 
Agency and the State Property Fund. 
Like the other countries of central Europe, Latvia places 
strong emphasis on the approximation of legislation as a 
key step towards eventual accession to the European 
Union. The reform of public administration is an essential 
part of this effort, and a Phare-funded scheme will train as 
many civil servants as possible by the year 2000. 
Despite its economic success, the Latvian economy 
suffered a number of setbacks in 1995. In June 1995 the 
main commercial bank, Bankas Baltija, was declared 
insolvent, precipitating a general banking crisis. The 
European Union pledged to give ECU 2.5 million to help 
the financial sector. 
A further economic setback was caused by a shortfall in 
government revenue as a result of tax evasion. This 
resulted in a budget crisis in the first half of 1995 and 
contributed to a state budget deficit for 1995 of 
approximately 4.8 per cent of Gross Domestic Product. 
In 1995, Latvia took a number of steps towards 
membership of the European Union. A Europe Agreement 
was signed in June 1995 and Latvia submitted its formal 
application for membership of the European Union on 27 
October 1995. The country participates fully in the 
structured dialogue of the pre-accession strategy. 
Phare's assistance to Latvia has focused on the provision of 
know-how. This has concentrated in particular on public Funds allocated by sector 1995 
ECU 32.5 million 
Social development 
and employment Public institutions 
and administrative reform 1.3 
Education, training 
and research 2 
Financial sector 2.5 
Private sector 
development and 
enterprise support 8.3 Infrastructure 
(energy, transport, 
telecom.) 9.2 
administration reform, privatisation, the development of 
small and medium-sized enterprises and the improvement 
of the banking, agriculture, telecommunications, energy, 
transport, health and higher education sectors. During 1995, 
however, Phare support was broadened to include support 
for economic reform, institutional and human resources 
development and infrastructure development 
Within Phare's efforts to support Latvian infrastructure 
development, the energy sector received particular 
attention. The country has no hydrocarbon resources, and 
is to a great extent dependent on energy imports. 
However, there are domestic sources which can be 
developed, notably hydropower, wood and peat and Phare 
has financed studies to examine the feasibility of their 
development. 
Phare funds for Latvia were ECU 32.5 million in 1995. 
This brings the total of funds committed to Latvia for the 
period 1991-1995 to ECU 108 million. Looking forward, 
the multi-annual indicative programme, signed in 1995, 
will focus on the following priority sectors during the 
period 1996-99 
• private sector development: this includes restructuring 
and privatisation, banking, small and medium-sized 
enterprise development, foreign investment and trade 
promotion and agricultural reform 
• institutional integration, human resources and social 
sector, including statistical cooperation, public 
administration reform, higher education, public finance 
and accounting, and social sector reform 
• infrastructure - focusing on the energy sector, 
environment and transport development. 
20 
Lithuania 
The Lithuanian economy emerged from deep recession 
following the dissolution of the Soviet Union and, having 
declined in 1992 and 1993, Gross Domestic Product grew 
by 1.5 per cent in 1994 and 5 per cent in 1995. 
The privatisation process has been satisfactory and, in the 
small companies sector, has progressed rapidly, conducted 
mainly through the exchange of vouchers or through local 
investors. By mid-1995, a new law on privatisation was 
passed by the parliament outlining the relative responsibil­
ities of the economic ministries, state institutions, and 
local authorities. The law clearly marks a commitment by 
the government to complete the privatisation process. 
In addition, a privatisation agency was created in 1995 
which, assisted by a resident Phare advisor, has rapidly 
become operational. The agency is a semi-autonomous 
body whose objective is to prepare and implement the 
remaining privatisation programme under the supervision 
of the Prime Minister's office. Both the new law and the 
operations of the agency are expected to boost the 
privatisation process, with an additional focus put on 
restructuring companies in order to provide further 
technical competence or financial means to those 
companies already privatised. 
As part of the development of the private sector, in 1995 
the government also started to define the legal framework 
for small and medium-sized enterprises and a 
development agency has been established as a non-profit 
and independent institution. Entrepreneurs, however, 
continue to suffer from a lack of finance for capital 
formation. To a certain extent this has been helped by the 
rapid growth in foreign investment (some ECU 254 
million between 1989 and 1994) although this is 
significantly less than the other Baltic states. The problem 
of coordination among the various economic development 
agencies established over the past few years is being 
addressed by the government. 
Lithuania's formal application to join the European Union 
was presented in December 1995 and was reinforced by a 
declaration adopted by the Lithuanian parliament. 
The Europe Agreement was signed by Lithuania during 
June 1995 and the country has subsequently actively 
participated in all the meetings organised within the 
framework of the structured dialogue. Moreover, the 
government has been active in setting up both the 
institutional and legislative framework to begin the 
European Integration process. Funds allocated by sector 1995 
ECU 42 million 
Social development 
and employment 4.4 Public institutions 
and administrative reform 5.S 
Education, training 
nd research 3.5 
Infrastructure 
(energy, transport, 
telecom.) 19 
As part of this, Lithuania made efforts in 1995 to begin to 
approximate its legislation to that of the European 
Community's 'acquis communautaire'. Phare helped this 
process by supporting the development of legislation in 
financial services (banking law, insurance and securities), 
commercial law, labour law, European Community and 
international law, and constitutional and administrative law. 
An amendment to the Lithuanian constitution, relating to 
the purchase of land by foreigners and made necessary by 
the Europe Agreement, is expected to be passed by the 
parliament in the first half of 1996. The Europe 
Agreement is also expected to be ratified during 1996. 
In 1995, Phare committed ECU 38 million to Lithuania, 
an increase of ECU 4 million on the previous year. This 
money was focused on the priority areas outlined in the 
1994-1995 indicative programme: economic development, 
infrastructure development, the public investment 
programme, European integration and human resources 
development. 
Phare's contribution to the development of the private 
sector has been to help to launch a network of Business 
Advisory Centres and a Euro-Correspondence Centre in 
Vilnius. It has also continued to provide one resident 
advisor to the Lithuanian Investment Promotion Agency 
which was set up in 1993 to promote the country. 
21 
Phare has also been active in the agricultural sector which Phare was also active in programmes focusing on public 
has suffered a decline over the past few years but remains administration reform, where a policy design programme 
the second largest sector of the economy. The was completed in March 1995; the health sector, 
privatisation of holdings has led to a break-up of the land particularly in primary healthcare; and the provision of 
into small parcels and this, together with the limited strategic advice in the social sector and labour market 
availability of capital, business skills and know-how, area, 
continues to depress the sector. Phare has therefore helped 
to develop policies aimed at strengthening economic 
planning in the sector and to deliver business and 
technical advice and credit and loan finance. 
22 
Poland 
In 1995, Poland moved significantly further along the road 
of economic reform. Over half of national income is now 
generated by the private sector, the transformation to a 
market economy is established and economic performance 
is becoming increasingly independent of political 
developments. 
The country's economic progress was reflected most 
clearly in the 1995 growth rate: after a 5 per cent increase 
in 1994, Gross Domestic Product grew by 7 per cent in 
1995 due to a strong surge in exports and investment. 
On the back of this economic performance, the Polish 
government officially launched the mass privatisation 
programme in November 1995. The programme created 
15 national investment funds run by professional asset 
managers. Each of the funds acts as the holding company 
for some 500 medium-sized enterprises being privatised, 
with the public able to buy shares in the funds at a 
symbolic price. The European Community, through its 
Phare Programme provided support to this programme by 
financing the public awareness campaign, as well as the 
printing and distribution of share certificates. The 
privatisation of the remaining 4,400 state-owned 
enterprises will be continued in 1996. 
As part of this privatisation process, renewed efforts were 
made to restructure and privatise the banking sector which 
is still 60 per cent state-owned. Phare continued to provide 
support to the banking work-out unit in charge of this 
process and decisive acceleration in this area is expected 
in 1996. 
Under its Phare Programme for Poland in 1995, the 
European Union committed ECU 174 million. This 
amount is part of the multi-annual indicative programme 
for Poland, whose budget for 1995 to 1999 totals ECU 
1,015 million of grant funds. 
The main objective of Phare support within this 
framework is to facilitate Poland's participation in the 
process of European integration by supporting the process 
of socio-economic transformation. Funds allocated by sector 1995 
ECU 174 million 
Private sector development 
and enterprise support 9 Public institutions 
and administrative reform 2 
Agricultural restructuring 13 
Environment and 
nuclear safety 22 
The multi-annual indicative programme focuses on the 
following key areas, which were chosen in line with the 
Polish government's economic strategy for 1994-1997 
• bringing industrial relations closer to those existing in 
the market economy, counteracting structural 
unemployment and improving environmental 
protection 
• continuing institutional reforms in the fields of social 
security, social services and the financial sector 
. increasing the competitiveness of the Polish economy. 
Within the 1995 Phare programme for Poland, the 
continued support for the development of the country's 
infrastructure represented 52 per cent of the funds 
committed. Of this, ECU 22 million were attributed to the 
co-financing, with the European Investment Bank and the 
European Bank for Reconstruction and Development, of 
the modernisation of the E-20 railway line linking Berlin, 
Warsaw, Minsk and Moscow. 
ECU 53 million were attributed to cross-border 
cooperation in 1995. The funds are to be attributed in a 
concentrated manner, with only eight regions on the 
border with Germany and the Baltic Sea receiving funds. 
Ultimately, the programme aims to develop the 
infrastructure on Poland's western border until it reaches a 
23 
level similar to that achieved in the eastern part of 
Germany. Funds are mainly concentrated on transport 
infrastructure and the environment, 55 per cent of which is 
devoted to border crossings. Further infrastructure support 
is being generated through continued regional 
development activities financed by Phare in various 
regions of Poland, for which ECU 20 million were 
committed. 
The continued importance of the environmental sector 
was reflected in the extension of financing for the 
National Environment Fund by ECU 18 million. This was 
in accordance with a recommendation by the European 
Parliament to maintain Phare funding for environmental 
clean-up projects. Other major areas of support under the 1995 Phare 
programme for Poland included agriculture, tourist 
development and the educational sector. 
The significant acceleration of Phare implementation in 
1995 was encouraging and reflected the enhancement of 
relations between Poland and the European Union which 
could be observed in 1995. Within the framework of the 
Europe Agreement, the bilateral Association Council held 
its second meeting in July 1995. The Council focused on 
three issues: Poland's strategy for integration into the 
European Union; intra-regional cooperation; and trade-
related issues. 
24 
Romania 
For Romania, 1995 was a year of steady economic 
progress and stronger political relations with the European 
Union. Official government figures for the year 1995 
show a 6.9 per cent increase of gross domestic product, a 
halving of the inflation rate to 27.8 per cent, a reduction in 
the unemployment rate from 10.9 per cent to 8.9 per cent 
and a 16.3 per cent increase in the average real wage. 
However, the deterioration of the balance of payments and 
of the public's confidence in the national currency which 
occurred in the last part of the year shows that, even if 
impressive achievements have been recorded, not all the 
macroeconomic conditions for sustainable growth are in 
place. 
At the microeconomic level in 1995, the State Ownership 
Fund managed to divest itself of over 650 companies, the 
best annual performance to date in terms of the number of 
companies. This brings the total number of privatised 
companies in Romania to 1,524, representing some 10 per 
cent of the total employed workforce. Moreover, in June 
1995 a revised Mass Privatisation Programme was 
launched. Under this new programme, Romanian citizens 
will receive a significant shareholding in up to 4,000 
Romanian enterprises. The State Ownership Fund will 
retain significant residual stakes which will be sold for 
cash by one of several methods: auction, public offering, 
trade sale. Public interest in the programme was limited 
and an extension of the subscription period up to March 
1996 was established. The programme will facilitate the 
decentralisation of the productive sector and will prove an 
important step towards a functioning market economy. 
For 1995, Phare committed ECU 66 million to 
programmes in Romania for implementation foreseen 
over two to three years. This amount is part of the multi-
annual financial perspective for Romania, whose budget 
for the 1995-1999 period totals ECU 550 million. 
Assistance for the period 1990-1994 totalled ECU 542 
million. 
In 1995, Phare was particularly active in implementing 
assistance in the areas of privatisation and industrial 
restructuring. Support was provided for the implementa­
tion of the government's Mass Privatisation Programme, 
which included a public awareness campaign to maximise 
public understanding and involvement. In addition, 
substantial Phare assistance is being granted to the State 
Ownership Fund to assist in the disposal of its residual 
stakes. Funds allocated by sector 1995 
ECU 66 million 
Education, training 
and research 18 
In the restructuring of the major state-owned enterprises, 
progress was slow in 1995. There was a substantial Phare 
contribution in terms of the preparation of financial 
recovery plans for 26 heavily-indebted enterprises, but 
these plans have not yet been put into effect. 
Phare continued to help the development of small and 
medium-sized enterprises (SMEs) through support to a 
network of SME advisory centres backed up by a grant aid 
scheme. Phare also financed an assistance programme for 
banks to help them in doing business with SMEs. 
Beyond the enterprise sector, there was substantial 
progress in other areas of reform. For example, the reform 
of vocational education is gathering pace with major 
Phare assistance both to the process at national level and 
to a key group of 25 vocational schools around the 
country. In addition, the new Education Law foresees the 
development of university autonomy, and a Phare 
programme has been developed to support this approach. 
Restructuring of the research and technology sector, 
which played a big role in the centralised economy, was 
also initiated under support from Phare. 
Phare has been active in supporting decentralised projects 
developed by local partnerships between public and 
private sector bodies in towns throughout the country. The 
most developed programme in this area is focused on the 
development of active employment measures. 
25 
Phare grants worth ECU 50,000 were awarded to projects 
in 21 towns in 1995. The number of towns will increase in 
1996. Additional programmes of this nature under 
preparation in 1995 include support to local economic 
development and social services. 
In its efforts to develop civil society, Phare has supported, 
through the Democracy programme, the implementation 
of 19 micro-projects in the following areas: training of 
young politicians; encouraging dialogue between local 
government and citizens; strengthening Romanian 
organisations and their cooperation with authorities at 
local and national levels; promoting children's rights; 
Hungarian-Romanian dialogue and other multi-cultural 
activities. In the health sector, Phare contributed to the 
development of techniques to preserve vaccines in rural 
areas. The Europe Agreement between Romania and the 
European Communities and their Member States came 
into force in February 1995. The first meeting of the 
Association Council took place in April 1995. At the 
Association Committee in October 1995, access to the 
Phare cross-border and implementation of multi-country 
programmes were discussed, together with commercial 
funding issues. 
In June 1995, the country submitted its formal application 
for membership of the European Union. Declaration of 
support for Romania's accession was signed by all the 
parties attached to the application. Likewise, the "national 
strategy for accession", which accompanied Romania's 
formal application, placed great emphasis on the national 
consensus driving Romania's political, social and 
economic transition. 
Phare supported the development of Romanian 
infrastructure both directly through co-financing, with the 
European Investment Bank, of a major road rehabilitation 
project and, indirectly, through the financing of feasibility 
studies and other preparatory work in the sectors of 
transport, telecommunications and energy. In line with the White Paper on the internal market, 
Romania began work on the harmonisation of national 
legislation with that of the European Community. Priority 
has been given to competition, state aids, public and 
financial services, and the free movement of people. 
26 
Slovakia 
Slovakia achieved an impressive macroeconomic 
performance in 1995. It recorded high GDP growth and 
low inflation, while the trade balance remained positive 
and the government deficit fell significantly. The only 
negative elements were the unemployment rate and the 
low level of foreign investment. 
After the spectacular economic turnaround in 1994, when 
the economy expanded by 4.8 per cent, real GDP growth 
accelerated further in 1995 to reach 7.4 per cent. Higher 
real wages and some increase in employment promoted 
private consumption, and economic growth was finally 
having a positive impact on investment. Despite the 
acceleration in economic growth, inflation fell below 10 
per cent, thanks mainly to a continued tight monetary 
policy. 
Higher growth also led to higher import levels, which 
reduced the current account surplus and the contribution 
of net exports to growth. 
Phare committed ECU 46 million to Slovakia in 1995, an 
increase on the previous year's figure of ECU 40 million. 
The total Phare commitment was the first tranche of the 
multi-annual indicative programme, agreed in 1995. This 
states that Phare's support in the medium term will focus 
on the following broad strategy areas 
• adopting the 'acquis communautaire', including the 
modernisation of the structures of state and society, and 
the approximation of laws, standards and regulations 
• private sector development and restructuring 
• human resources development, including social sector 
reform 
• infrastructure development. 
Under the multi-annual indicative programme for 1995-
1999, committed funds in the future may be modulated on 
the basis of needs and absorption capacity. The latter is of 
particular importance given that the Slovak performance 
on past programmes leaves room for improvement. An 
on-going dialogue with the Slovak authorities is in 
progress on how to improve the efficiency and 
effectiveness of Phare. Funds allocated by sector 1995 
ECU 46 million 
Public-
health 2 
Social development 
and employmen 
Integrated 
regional 
measures 1 Public institutions and 
administrative reform 5 
Agricultural restructuring 2.6 
Civil society and 
démocratisation 0 
Education, training 
and research 5 
Environment and 
nuclear safety 1 
Financial sector 3 
Infrastructure (energy, 
transport, telecom.) 8.2 
Phare support in 1995 concentrated mainly on the 
provision of know-how and investment support to assist 
private sector development. Specifically, Phare supported 
the following projects vital to assisting Slovakia in its 
preparation for membership of the European Union 
• a post privatisation fund, a joint Phare-European Bank 
for Reconstruction and Development initiative 
providing equity capital and know-how to Slovak 
medium-sized enterprises 
• the successful small and medium-sized enterprises 
programme which brings financial assistance and 
know-how transfer to Slovak small and medium-sized 
enterprises. The financial instruments under the 
programme have all been well subscribed, particularly 
the small loans fund. This financial assistance, together 
with business counselling through a network of 
assistance centres, provides small and medium-sized 
enterprises with a valuable service 
• continued know-how transfer to the Slovak National bank 
and the Ministry of Finance in support of their important 
role in economic reform and European integration 
. in the human resources development area, a health 
programme was launched in 1995, focusing on primary 
health care and health financing 
• further support to the Slovak customs administration, 
the standards office, the judiciary and the civic society 
programme 
27 
a significant infrastructure initiative, funded in 1995, 
providing investment support for the drilling of a 
geothermal well 
a Slovak-Austrian cross-border cooperation programme, 
involving the commitment of ECU 4 million to a 
number of environmental (sewage and waster water 
treatment) projects as well as feasibility studies in 
transport, socio-economic development and regional 
planning fields. Slovakia has made integration into western political, 
economic and security structures, and particularly 
membership of the European Union, a priority. On 27 
June 1995, Slovakia formally applied to join the European 
Union. It participated fully in the structured dialogue with 
the Member States throughout the year and furthered the 
implementation of the Europe Agreement through the first 
meeting of the Association Council in May and the Joint 
Parliamentary Association Committee in November. 
28 
Slovenia 
Through a series of rapid economic adjustments, Slovenia 
has achieved a high level of macroeconomic stability. In 
terms of income per capita, the country is at a level similar 
to that of some Member States of the European Union. In 
1995, the economy grew by almost 5 per cent, and the rate 
of inflation fell below 10 per cent. 65 per cent of the 
country's exports are sold to the European Union. 
Slovenia's performance within the Phare Programme is 
impressive: the contracting rates have been particularly 
high with almost 100 per cent of funds committed in 1992 
and 1993, and almost 60 per cent of those committed in 
1994 being contracted. This reflects the efficient way in 
which Slovenia uses Phare funds. 
In 1995, Slovenia was allocated ECU 16.4 million within 
the framework of the country operational programme. In 
addition, funding committed to cross-border cooperation 
(ECU 6 million) and the Tempus programme (ECU 2.6 
million) brought the total amount of Phare funding in 
1995 to ECU 25 million. 
In 1995, Phare had an immediate impact in certain key 
areas. There was continuing support for sector and 
enterprise restructuring, including the training of business 
executives, and for the voucher privatisation scheme. 
Funds were used to unblock the border-crossing to 
Hungary at Dolga Vas, a major transport bottleneck on 
one of the principal routes into central Europe, and the 
reform of public finances and the banking sector, 
including the creation of a new fiscal system, were also 
supported. 
The cross-border cooperation programme with Austria 
involved the improvement of the Jezersko border-
crossing, and the reconstruction of the sewage system in 
Gornja Radgona. A similar programme with Italy covered, 
among others areas, transport infrastructure, the 
environment, human resources development, and cultural 
cooperation. 
In June 1995, a memorandum of understanding was 
signed between the National Phare Coordinator and the 
Commission which outlined the strategy for future Phare 
multi-annual assistance to Slovenia. This served as a basis 
for the 1996-1999 multi-annual indicative programme 
which, in line with the principal government policy 
objective of closer integration with the European Union 
and eventual membership, outlines three broad areas 
where Phare will support Slovenia's pre-accession 
strategy Funds allocated by sector in 1995 
ECU 25 million 
Education, training 
and research 2.6 
Social development 
and employment 4.4 Infrastructure (energy, 
transport, telecom.) 7.4 
Private sector development 
and enterprise support 3 
. preparing to take on obligations of membership (the 
'acquis communautaire') through the progressive 
adaptation of laws, standards and rules to achieve 
compatibility with those of the European Union. This 
includes making provisions for their implementation 
and enforcement as well as adjustments to take account 
of key internal Union policies, such as in agriculture. 
• the development and strengthening of economic, 
commercial and physical links, not only with the 
Union, but also with associated countries and, where 
appropriate, other neighbouring regions. This is an 
essential element in preparation for future enlargement 
and sustainable development of the region as a whole. 
• medium-term economic and social structural reform. 
This includes raising the competitiveness of industry 
and services to international levels, as well as 
promoting further development of the private sector, 
investment, export capacity and capital markets. In 
addition, the social sector and public administration 
will need to be reformed, as well as the science and 
technology, infrastructure and environmental protection 
sectors, and regions facing difficulties with reform will 
need to be supported. 
During the year under review, Slovenia's Europe 
Agreement was initialled. The Trade and Economic 
Cooperation Agreement, signed in 1993, continued to 
underpin trade relations between the two sides. Since the 
signature of the Europe Agreement on 10 June 1996, 
Slovenia participates fully in the pre-accession strategy 
and the Government has drafted a white paper for a 
national pre-accession strategy, and set up the structures 
for its implementation. 
29 
1990 -1995 funds committed by country 
Albania 
Bulgaria (in ECU million) 
m 106.5 
Czech Republic 1990 0 
1991 0 
1992 0 
1993 
1994 
1995 
Czechoslovakia 1990 
1991 
1992 
1993 0 
1994 0 
1995 0 34 
99 
6 100 
Estonia 1990 0 
1991 0 
1992 
1993 
1994 
1995 10 
12 
22.5 
24 
GDR 1990 
1991 0 
1992 0 
1993 0 
1994 0 
1995 0 
Hungary 
i us 
Latvia 
Lithuania 1990 0 
1991 0 
1992 1 
1993 
1994 
1995 25 
39 
42 
Poland 1990 
1991 
1992 
1993 
1994 
1995 ^t*$9$ftWRR 197 
200 
225 
(208/8, 
30 
Romania 
Slovakia 
Slovenia 
Former 
Yugoslavia 
Multi-country 
programmes 
Other 
programmes 
243.2 
Note: 
The 1995 Phare Annual Report contains figures from all 
five budget lines (B7-5200 Phare Democracy Programme, 
B7-6000 Assistance for economic restructuring in the 
countries of central and eastern Europe (Phare), B7-6020 
Cross-border cooperation, B7-6310 Community 
contribution to measures taken by NGOs, B7-6330 
Opening of Community programmes to associated 
countries of central Europe) managed within the 
framework of the Phare Programme. Owing to software limitations figures contained in the 
1994 Phare Annual Report only included two budget 
lines. 
This therefore accounts for the small discrepancy in the 
historical figures between the 1994 and the 1995 Phare 
Annual reports. 
31 
1990 -1995 funds committed by sector 
Agricultural 
restructuring 
Civil society and 
démocratisation 
Critical aid (in ECU million) 
Education, 
training and 
research 
Environment 
and nuclear 
safety 
Infrastructure 
(energy, transport, 
telecom­
munications) 
Private sector 
development and 
enterprise support 
Public health 
Public institutions 
and administrative 
reform 
32 
Social 
development 
and employment 
Approximation 
of legislation 
Consumer 
protection 
Financial 
sector 
Integrated 
regional 
measures 
Other sectors 1990 0 
1991 0 
1992 0 
1993 0 
1994 0 
1995 | 2 
1990 0 
1991 0 
1992 0 
1993 Hp5 
1994 p4 
1995 0 I 48.2 
47.3 
Note: 
The 1995 Phare Annual Report contains figures from all 
five budget lines managed within the framework of the 
Phare Programme. 
Owing to software limitations, figures contained in the 
1994 Phare Annual Report only included two budget 
lines. This therefore accounts for the small discrepancy in the historical figures between the 1994 and the 1995 Phare 
Annual reports. 
Owing to the financial reporting process it is possible to 
provide more accurate sector breakdown. This accounts 
for the increase in sectors from 9 in 1994 to 15 in the 1995 
Annual Report. 
33 
Phare funding by country 
Albania (in ECU million) 
Funds allocated by sector 1990-1995 1990 1991 1992 1993 1994 1995 Total 
Public institutions and administrative reform 0 6 0 1.2 4.6 0 5,8 
Agricultural restructuring Ô 0 15 10 5 0 30 
Civil society and démocratisation 0 0 0 0 0 0 0 
Education, training and research 0 0 1.2 2.5 2.4 3.5 9.6 
Environment and nuclear safety 0 Ô 0 3.3 0 0 3.3 
Financial sector 0 0 35 35 0 35 105 
Critical aid 0 10 50 10 7 0 77 
Infrastructure (energy, transport, telecom.) 0 Ô 4.4 0 23 34 61.4 
Approximation of legislation 0 0 0 0 0 0 0 
Consumer protection 0 0 0 0 Ô 0 0 
Private sector development and enterprise support 0 0 0 7 0 0 7 
Integrated regional measures 0 0 0 0 0 8.5 8.5 
Social development and employment 0 0 0 0 0 0 0 
Public health 0 Ô 0 6 7 0 13 
Other 0 0 4.4 0 0 7 11.4 
Total 0 10 110 75 49 88 332 
Bulgaria Note: Albania entered the Phare Programme in 1991 
Funds allocated by sector 1990-1995 1990 1991 
Public institutions and administrative reform 0 0 
Agricultural restructuring 16 25 
Civil society and démocratisation 0 0 
Education, training and research 0 5 
Environment and nuclear safety 3.5 19 
Financial sector 0 10 
Critical aid 5 20 
Infrastructure (energy, transport, telecom.) 0 5 
Approximation of legislation 0 0 
Consumer protection 0 0 
Private sector development and enterprise support 0 20 
Integrated regional measures 0 0 
Social development and employment 0 2.5 
Public health 0 0 
Other 0 0 
Total 24.5 106.5 1992 
0 
10 
0 
0 
()" 
21 
0 
0 
22.5 
0 
0 
15 
0 
87.5 1993 
16 
0 
0 
17.5 
15.6 
5"" 
0 
13.9 
0 
"" 0 
6 
0 
4 
10.5 
1.5 
90 1994 
1.2 
0 
1.2 
12 
5 
0 
0 
62.6 
0 
0 
3 
0 
0 
0 
0 
85 1995 
" "O 
5 
0 
21 
""7 
"""" 0 
0 
48 
2 
0 
0 
0 
0 
0 
0 
83 Total 
17.2 
56 
1.2 
63.5 
61.1 
15 
25 
150.5 
2 
0 
51.5 
0 
6.5 
25.5" 
1.5 
476.5 
Czech Republic 
Funds allocated by sector 1990-1995 1990 1991 1992 
Public institutions and administrative reform 0 0 0 
Agricultural restructuring 0 0 0 
Civil society and démocratisation 0 0 0 
Education, training and research 0 0 0 
Environment and nuclear safety 0 0 0 
Financial sector 0 0 0 
Critical aid ~" 0 " 0 0"" 
Infrastructure (energy, transport, telecom.) 0 0 0 
Approximation of legislation 0 0 0 
Consumer protection 0 0 0 
Private sector development and enterprise support 0 0 0 
Integrated regional measures 0 0 0 
Social development and employment 0 0 0 
Public health 0 0 0 
Other 0 0 0 
Total 0 0 0 1993 
0 
"(T 
o 
o 
o 
o 
9 
" ô 
0 
"27" 
0 
"8 
0 
8 
60 1994 
4.5 
Ô 
5.5 
0 
0 
0 
25 
0 
0 
0 
0 
14 
0 
0 
60 1995 
"""5 
0" 
0 
8 
0 
0 
0 
91 
0 
0 
1 
0 
""2 
0 
3 
110 Total 
16 
"4.5 
Ô 
"21.5 
0 
0 
0 
125 
0 
0 
28 
0 
24 
0 
11 
230 
Note: Prior to 1993 funds were provided to Czechoslovakia 
34 
Czechoslovakia 
Funds allocated by sector 1990-1995 1990 
Public institutions and administrative reform 0 
Agricultural restructuring 0 
Civil society and démocratisation 0 
Education, training and research 4 
Environment and nuclear safety 30 
Financial sector 0 
Critical aid ~W 
Infrastructure (energy, transport, telecom.) 0 
Approximation of legislation 6 
Consumer protection 0 
Private sector development and enterprise support 0 
Integrated regional measures 0 
Social development and employment 0 
Public health (T 
Other (T 
Total 34 1991 
0 
"IT 
~o" 
"9 
~T" 
o 
"6 
lT 
"6 
"o 
39 
"IT 
15" 
""0 
2Ï)" 
99 1992 
"" Ô" 
IT 
4" 
"""25 " 
~~Q~ 
o 
"o 
"10 
" 0 
""" 0 
31 
"IT" 
""" o "" 
~ o 
"""" 30" 
100 1993 
'"" " ô rr IF 
0 " 
~"T" 
o 1994 
0 
0" 
""()" 
Ô 
0 
0 
0 
0 
"""() 
0" 
0 
(")" 
""" 0 
0 
ô" 
0 1995 Total 
0 
0 
"4 
"38" 
35 
0 
" 0 
"21 
" 0 
" 0 
70 
" 0 
~i~5 
" 0 
50 
233 
Note: from 1993 Phare funding was provided separately to the Czech republic and Slovakia 
Estonia 
Funds allocated by sector 1990-1995 
Public institutions and administrative reform 
Agricultural restructuring 
Civil society and démocratisation 
Education, training and research 
Environment and nuclear safety 
Financial sector 
Critical aid 
Infrastructure (energy, transport, telecom.) 
Approximation of legislation 
Consumer protection 
Private sector development and enterprise support 
Integrated regional measures 
Social development and employment 
Public health 
Other 
Total 1990 1991 1992 1993 
0 
0 
0 
0 
9 
To 0 
0 
"0 
1.5 
0 
ô 
"0 
1) 
0 
" 0 
"""0 
0 
'"()' 
0 
10.5 
12 1994 
0 
0 
"Ô 
4.5 
2.5 
0 
~~ Ô" 
"~ 6 
"6 
o 
"8 
0 
"""""(")" 
ô 
"~[.5" 
22.5 1995 Total 
2.8 
0 
0 2.8 
0 
0 
4.2 
(") 
()'" 
O" 
" 5" 
" "()" 
0 
9.1 
0 
Y9 
" (V 
o 
24 11.2 
2.5 
"'() 
0 
II 
0 
0 
17.1 
0 
2.9 
""'"'() 
21 
68.5 
GDR Note: Estonia entered the Phare Programme in 1992 
Funds allocated by sector 1990-1995 1990 1991 
Public institutions and administrative reform 0 0 
Agricultural restructuring 0 0 
Civil society and démocratisation 0 0 
Education, training and research 1 0 
Environment and nuclear safety 20 0 
Approximation of legislation 6 0 
Consumer protection 0 0 
Private sector development and enterprise support 0 0 
Integrated regional measures 0 0 
Social development and employment 0 0 
Public health (T 6 
Other " Ï4 0"" 
Total 35 0 1992 
(T 
'""(F 
" 0 
b 
ô 
6 
o 
~'"o 
o 
o 
" "o" 
6 1993 
_ 0' 
0"" 
" "0 
"0 
""~ô 
ô~ 
(T 
0 
() " 
0 
'~~ô~ 
0 
0 1994 
(T 
"o 
"o 
"" "o" 
o 
"o 
o 
o 
o 
0 
" 0 
0 
0 1995 Total 
0 
" 0 
0 
" 1 
20 
0 
0 
0 
" 0 
0 
0 
"14 
"35 
Note: Support to GDR ceased after the German unification in 1990 
35 
Hungary 
Funds allocated by sector 1990-1995 
Public institutions and administrative reform 
Agricultural restructuring 
Civil society and démocratisation 
Education, training and research 
Environment and nuclear safety 
Financial sector 
Critical aid 
Infrastructure (energy, transport, telecom.) 
Approximation of legislation 
Consumer protection 
Private sector development and enterprise support 
Integrated regional measures 
Social development and employment 
Public health 
Other 
Total 1990 
b" 
b" 1991 
7.5 
27" 
5 
""b 
OX 
b 
b" 
26 
b 
"" 3" 
" 0 
0 
893 7.5 
b 
" 0 
45.5 
"" "0" 
0 
"""0 
b" 
115 1992 
TT3" 
5" 
b 
2T 
""" ib 
o 
b 
o 
o 
o 
H 
""To 
"26" 
0 
4 
101.5 1993 
1.5 
TÔ3" 
b" 
26" 
""' b" 
o 
"0 
b 
b 
31 
"" 0 
_.. ..... 
" To 
l 
100 1994 
"""" b 
""'o 
"""' "o 
24"" 
T 5:5 
0 
""" b" 
29" 
0 
" 0 
16.5 
__ Q. 
0 
"" 0 
0" 
85 1995 
3 
To 
"b 
16 
12" 
0 
0" 
36 
0 
"0 
6 
"5 
2 
"O 
'2 
92 Total 
"27" 
""""78.5 
0 
T11.5 
74.5""" 
19 
b" 
73.5" 
0 """ 
"'"" 0 
136 
""15 
"31 
10 
7 
582.8 
Latvia 
Funds allocated by sector 1990-1995 
Public institutions and administrative reform 
Agricultural restructuring 
Civil society and démocratisation 
Education, training and research 
Environment and nuclear safety 
Financial sector 
Critical aid 
Infrastructure (energy, transport, telecom.) 
Approximation of legislation 
Consumer protection 
Private sector development and enterprise support 
Integrated regional measures 
Social development and employment 
Public health 
Other 
Total 1990 
o 
0 
b" 
b" 
(T 
b" ""b" __. 
" "0 
"""b" 
b" 
0 
"b" 
"b" 
"0" 
0 1991 
~~rT" 
b 
"""b" 
jT 
o" 
"IT 
b" 
"b" 
"0 1992 
b" 
0 
0 
1.5 
"0 
""0" 
0 
0" 
"b" 
0 
"b" 
0 
b 
0 
'"'"15" 1993 
b" 
b 
2 
0 " 
b" 
.... .„_ 
0" 
"~ b" 
__ ^ 
""" b 
0 
" 0 
"0 
"T"6" 
18 1994 
"0" 
0 
b 
5 
"5.5" 
14.5 " 
"" b 
b" 
" b" 
"""""'b 
0 
0 
"" 0 
0" 
4.5""" 
29.5 1995 Total 
1.3 
0 
"0" 
2 
""Ô" 
"2.5" 
0 
9.2 
"~0 
b 
"875 
0 
"9T2 
b" 
"0 
32.5" 1.3 
0 
0" 
10.5 
5.5" 
"17 
" 0 
9.2 
(") 
"" 0" 
8.3 
0 
"92" 
0" 
34 
95 
Lithuania Note: Latvia entered the Phare Programme in 1992 
Funds allocated by sector 1990-1995 
Public institutions and administrative reform 
Agricultural restructuring 
Civil society and démocratisation 
Education, training and research 
Environment and nuclear safety 
Financial sector 
Critical aid 
Infrastructure (energy, transport, telecom.) 
Approximation of legislation 
Consumer protection 
Private sector development and enterprise support 
Integrated regional measures 
Social development and employment 
Public health 
Other 
Total 1990 
0 " 
" 0" 
TT" 
0" 
0" 
"0 " 
0 
b 
0 
"b" 
"b"" 
b 
b" 
0 
"0 1991 
0" 
"b 
"b" 
b"" 
b" 
0 
0 
b 
0 
"0 
"b 
0 
"b" 
0 1992 
b" 
b" 
b"" 
1.5 
0 
0 
0 
0 
"""b" 
0 
"9.5 
b"" 1993 
0 
b 
9 
20 0 
2.5" 
"0 
b 
" "b" 
0 
"0" 
0 
b" 
0 
0 
0 
'22.5 
"2T" 1994 
... ___ 
"b"" 
b" 
6 
14.5 
b" 
16.5 
0 
0 
0 
" "" 0 
""" 0 
0 
r 
39 1995 Total 
5.5 
"0" 
0 
"375" 
"b" 
""0" 
0 
19 
" "0 
0 
"9.6 
" "0" 
"4.4" 
"0 
0 
42 5.5 
0 
" 0 
13.5" 
1 
14.5 
" 0 
35.5 
"" " b" 
0 
T9.1 
b" 
4.4 
0 
"32.5 
T26 
Note: Lithuania entered the Phare Programme in 1992 
36 
Poland 
7.5 
"TT 
b 1992 
972 
T8 
"0" 27 Funds allocated by sector 1990-1995 1990 1991 1992 1993 
Public institutions and administrative reform 10 
Agricultural restructuring 100 
Civil society and démocratisation 0 
Education, training and research 2.8 14.5 42 
Environment and nuclear safety 22 35 18 
Financial sector 2 16 4.7 
Critical aid 0 0 0" 
Infrastructure (energy, transport, telecom.) 6 10 26.4 
Approximation of legislation 0 0 0 
Consumer protection 0 0 0 
Private sector development and enterprise support 38 56 74.5 
Integrated regional measures 0 0 0 
Social development and employment 0 18 7.2 
Public health 0 20 " 0 0" 
Other 0 3 0 27 
Total 180.8 197 200 225 1994 
21.5 1995 
" 2"" 
30 
"b" 
"45" 
"0 
21 
"b" 
63" 
0 
""5" 
7 
"b" 
"b 2.5 
0 
"39 
12 
22 
0 
"93.8 
0 
0 
9 
0 
9 
0 
b 
208.8 13 
b 
"37 
22 
0 
"0" 
91" 
"b" 
0 
9 
0 
0 
b 
" 0 
174 Total 
"7772 " " 
T8b;5 
b 
180.3 
"Ï09 
65.7 
0 
29072 
0 
" ""'5 " 
193.5 
0" 
"3472 " 
"20 
30 
,185.6 
Romania 
Funds allocated by sector 1990-1995 
Public institutions and administrative reform 
Agricultural restructuring 
Civil society and démocratisation 
Education, training and research 
Environment and nuclear safety 
Financial sector 
Critical aid 
Infrastructure (energy, transport, telecom.) 
Approximation of legislation 
Consumer protection 
Private sector development and enterprise support 
Integrated regional measures 
Social development and employment 
Public health 
Other 
Total 1990 
b" 
o 1991 1992 1993 1994 1995 Total 
15.5 
0 
b 
b 
"b 
o 
o 
ô 
0" 0 
34 
0 
10 
0 
0" 
"34.3" 
9 
b 
b" 
b 
o 
"o 
275 
22 
1343 0 
32 
22 
0 
0 
"0 
40" 
0 
15" 
0 
20 
152 10 
5 
0 
18 
b 
0 
"979 
0 
0 
"b 
"7b 
0 
0 
b 
"27 
139.9 9.6 
0 
'"" 5" 
37 
" b 
o 
o 
25 
0 
""0 
"2374 
0 
"0 
0 
0 
100 0 
10 
0 
18 
b 
0 
b" 
38 
0 
"b" 
"o" 
o 
o 
o 
o 
66 19.6 
81 
5 
96 
"" 5 
5 
"81.7 
72 
0 
0 
133.4 
0 
15 
25 
69 
607.7 
Slovakia 
Funds allocated by sector 1990-1995 
Public institutions and administrative reform 
Agricultural restructuring 
Civil society and démocratisation 
Education, training and research 
Environment and nuclear safety 
Financial sector 
Critical aid 
Infrastructure (energy, transport, telecom.) 
Approximation of legislation 
Consumer protection 
Private sector development and enterprise support 
Integrated regional measures 
Social development and employment 
Public health 
Other 
Total 1990 1991 1992 1993 
0 0 
b o 
b b 
b b" 
b b 
b" b 
b b 
0 0 0 
' "5" 
"b 
"o"" 
"o" 
5 
b 
o 
"19" 
b 
"3" 
0 
5 
40 1994 
4 
"""""5 
b 
9 
b 
5 
"b " 
6.5 
0 
0 
0" 
0 
"5.5 " 
0 
5 
40 1995 Total 
"T ""'"' 9 
2J6 
0.5" 
5 
3 
"0" 
8.2 
"b 
o 
T472" 
1.5" 
""2.4" 
2" 
0.6 
46 10.6 
0.5 
19 
1 
8 
0 
19.7 
"" 0 
0 
373.2 
"T.5" 
10.9 
2 
"ÏÔ.6" 
126 
Note: prior to 1993 funds were provided to Czechoslovakia 
37 
Slovenia 
Funds allocated by sector 1990-1995 
Public institutions and administrative reform 
Agricultural restructuring 
Civil society and démocratisation 
Education, training and research 
Environment and nuclear safety 
Financial sector 
Critical aid 
Infrastructure (energy, transport, telecom.) 
Approximation of legislation 
Consumer protection 
Private sector development and enterprise support 
Integrated regional measures 
Social development and employment 
Public health 
Other 
Total 1990 1991 
"To" 
b" 
(T 1992 1993 
2.3 __. 
0 
"b" 
" b 
o 
" b" 
o 
o 
"b" 
To" o 
"TT 
"TT 
"375" 
"b" 
b 
"o 
"b 
"To" 
"o 
b 
"b" 
To" 
To" 
6.7 
"9" 7.5 
11 1994 
"0 
b" 
b"" 
"5.5"" 
b" 
o 
b" 
"6" 
"o" 
o " 
12.5 
"o" 
0" " 
0 
b" 
24 1995 
b"" 
b 
2T5" 
0 
0 
" 0 
"7"T"" 
"0 
0" 
3 
b 
"TT 
"b 
~7"6 
25 Total 
"TT 
""""""" 0 
0 
13.9 
0 
0 
0 
13.4 
0 
0 
15.5 
"""" 0 
4.4 
""""" 0 
Tl .8" 
69 
Former-Yugoslavia Note: Slovenia entered the Phare Programme in 1992 
Funds allocated by sector 1990-1995 1990 1991 
Public institutions and administrative reform 0 0 
Agricultural restructuring 0 0 
Civil society and démocratisation 0 0 
Education, training and research 0 6 
Environment and nuclear safety 0 0 
Financial sector 0 0 
Critical aid "TTbTT" 7T" 
Infrastructure (energy, transport, telecom.) 0 0 
Approximation of legislation 0 0 
Consumer protection 0 0 
Private sector development and enterprise support 0 0 
Integrated regional measures 0 0 
Social development and employment 0 0 
Public health 0 0 
Other 0" Ô 
Total 3071T37Ï" 1992 1993 
0 
0" 
b" 
0 
0" 
0" 
T"7".7"" 
b 
0" 
"0" 
"b" 
0 
0 
"0" 
0" 
47.7 25 
0 
"b 
0 
0 
0 
"b 
0 
0 
"25" 1994 
"""" 2 
0 
O 
0 
"b" 
"0 
" 23 
0 
0" 
""" "" 0" 
""O" 
0 
0 
"b" 
"0 " 
25" 1995 Total 
0 
0 
"O" 
0 
0 
"0 
T5" 
"0 
""() 
"0 
"0" 
0 
"0 
0 
0 
"25"' 2 
0 
0 
6 
0 
()" 
158 
0" 
0" 
0 
0 
0 
0 
" 0 
0 
166 
Multi-country programmes 
0 
213 0 Funds allocated by sector 1990-1995 1990 1991 
Public institutions and administrative reform 0 11 
Agricultural restructuring 0 0 
Civil society and démocratisation 
Education, training and research 
Environment and nuclear safety 0 
Financial sector 0 
Critical aid 51 
Infrastructure (energy, transport, telecom.) 0 
Approximation of legislation 0 
Consumer protection 0 
Private sector development and enterprise support 0 
Integrated regional measures 0 
Social development and employment 0 
Public health "F b" 
Other " 0 L5 
Total 7273 88.T 1992 1993 1994 1995 
28.1 
2375 ......... 
" b 
0 
"0 
0 
20" 
473" 
"b" 1.5 
0 
"24" 
"46" 
"0" 
"0" 
35" 
"b" 
0 
3 
6.5 
o 
0' 
Q 
116" 0 
2078" 
""20" 
0 
24 
"b 
0 
"27.5 
10 
"b" 
0 
b" 
TÎ23 25 
0 
"b" 
13 
13 
b" 
"b" 
31 
b" 
0 
" b" 
""4" 
"0 
0" 
0 
86 0 
""875" 
"20" 
0 
"0 
70.5 
"""Ô 
0 
"5 
0 
b 
b" 
"0 
TÔ4 Total 
47.5"" 
" b 
" b" 
115.7 
T22.5 
0 
51" 
160.5 
0" 
0 
" 55.5""" 
"24.8 
0 
0 
" 1.5 
"579 
38 
Other programmes 
Funds allocated by sector 1990-1995 1990 1991 1992 1993 1994 1995 Total 
Public institutions and administrative reform 0 0 0 0 3 0 3 
Agricultural restructuring 0 0 0 0 0 0 0 
Civil society and démocratisation 0 0 5 10 10 JO 35 
Education, training and research 0 0.4 0 9.9 7 17.8 35.1 
Environment and nuclear safety 0 0 0 0 23 20 43 
Financial sector 00 0 0 0 0 0 
Criticalaid 0 0 0 0 0 0 0 
Infrastructure (energy, transport, telecom.) 0 0 0 0 2 0 2 
Approximation of legislation 0 0 0 0 0 0 0 
Consumer protection 0 0 0 0 4 2 6 
Private sector development and enterprise support 0 0 0 0 21 74 95 
Integrated regional measures 0 0 0 0 0 32 32 
Social development and employment 0 0 0 0 0 20 20 
Public health "b 0 TT 0 6 0 6 
Other 13.4" 10 "38.6 54^9 43.5" 674 227.8 
Total 13.4 10.4 43.6 74.8 119.5 243.2 504.9 
39 
Phare funding by sector 
Agricultural restructuring Civil society and démocratisation 
1990 1991 1992 1993 1994 1995 Total 1990 1991 1992 1993 1994 1995 Total 
Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Former Yugoslavia 
Multi-country programmes 
Other 0 
16 
0 
0 
0 
0 
20 
0 
0 
100 
0 
0 
0 
0 
0 
0 
Total 136 0 
25 
0 
0 
0 
0 
13 
0 
0 
17 
34 
0 
0 
0 
0 
0 
89 15 
10 
0 
0 
0 
0 
5 
0 
0 
18 
32 
0 
0 
0 
0 
0 10 
0 
0 
0 
0 
0 
30.5 
0 
0 
30 
5 
3 
0 
0 
0 
0 5 
0 
4.5 
0 
0 
0 
0 
0 
0 
2.5 
0 
5 
0 
0 
0 
0 0 
5 
0 
0 
0 
0 
10 
0 
0 
13 
10 
2.6 
0 
0 
0 
0 30 
56 
4.5 
0 
0 
0 
78.5 
0 
0 
180.5 
81 
10.6 
0 
0 
0 
0 Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
80 78.5 17 40.6 441.1 Former Yugoslavia 
Multi-country programmes 
J)ther 
Total 0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
10 
10 0 
1.2 
0 
0 
0 
0 
0 
0 
0 
0 
5 
0 
0 
0 
0 
10 
16.2 0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0.5 
0 
0 
0 
10 
10.5 0 
1.2 
0 
4 
0 
0 
0 
0 
0 
0 
5 
0.5 
0 
0 
0 
35 
15.7 
(in ECU million) 
Approximation of legislation Consumer protection 
Albania 
Bulgaria 1990 
0 1991 1992 1993 1994 1995 Total 1990 1991 1992 1993 1994 1995 Total 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Former Yugoslavia 
Multi-country programmes 
Other 
Total Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Former Yugoslavia 
Multi-country programmes 
Other 
Total 
40 
Critical aid Environment and nuclear safety 
1990 1991 1992 1993 1994 1995 Total 1990 1991 1992 1993 1994 1995 Total 
Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 0 
5 
0 
0 
0 
0 
0 
0 
0 
0 
15.5 
0 
0 
Former Yugoslavia 30.2 
Multi-country programmes 51 
Other 0 
Total 101.7 10 
20 
0 
0 
0 
0 
0 
0 
0 
0 
34.3 
0 
0 
7.1 
0 
0 50 
0 
0 
0 
0 
0 
0 
0 
0 
0 
22 
0 
0 
47.7 
0 
0 
71.4 119.7 10 
0 
0 
0 
0 
0 
0 
0 
0 
0 
9.9 
0 
0 
25 
0 
0 
44.9 0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
25 
0 
0 
25 392.7 77 
25 
0 
0 
0 
0 
0 
0 
0 
0 
81.7 
0 
0 
158 
51 
0 Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Former Yugoslavia 
Multi-country programmes 
Other 0 
3.5 
0 
30 
0 
20 
27 
0 
0 
22 
0 
0 
0 
0 
0 
0 0 
19 
0 
5 
0 
0 
10 
0 
0 
35 
(I 
0 
0 
0 
23.5 
0 3.3 
15.6 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
20 
0 0 
5 
0 
0 
2.5 
0 
15.5 
5.5 
1 
12 
0 
0 
0 
0 
13 
23 3.3 
61.1 
0 
35 
2.5 
20 
74.5 
5.5 
1 
109 
5 
1 
0 
0 
122.5 
43 
Total 102.5 92.5 90 38.9 77.5 82 483.4 
Education, training and research Financial sector 
1990 1991 1992 1993 1994 1995 Total 
Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Former Yugoslavia 
Multi-country programmes 
Other 0 
0 
0 
4 
0 
1 
7.5 
0 
0 
2.8 
0 
0 
0 
0 
21.3 
0 
36.6 0 
5 
0 
9 
0 
0 
17 
0 
0 
14.5 
10 
0 
0 
6 
28.1 
0.4 1.2 
8 
0 
25 
1 
0 
21 
1.5 
1.5 
42 
13 
0 
2.3 
0 
24 
0 2.5 
17.5 
8 
0 
1.5 
0 
26 
2 
2.5 
45 
18 
5 
3.5 
0 
20.8 
9.9 2.4 
12 
5.5 
0 
4.5 
0 
24 
5 
6 
39 
37 
9 
5.5 
0 
13 
7 3.5 
21 
8 
0 
4.2 
0 
16 
2 
3.5 
37 
18 
5 
2.6 
0 
8.5 9.6 
63.5 
21.5 
38 
11.2 
1 
111.5 
10.5 
13.5 
180.3 
96 
19 
1.3.9 
6 
115.7 
90 140.5 162.2 169.9 17.8 35.1 
147.1 746.3 1990 1991 1992 
Albania 0 0 35 
Bulgaria 0 10 0 
Czech Republic 0 0 0 
Czechoslovakia 0 0 0 
Estonia 0 0 0 
GDR 0 0 0 
Hungary 5 14 0 
Latvia 0 0 0 
Lithuania 0 0 0 
Poland 2 16 4.7 
Romania 0 0 5 
Slovakia 0 0 0 
Slovenia 0 0 0 
Former Yugoslavia 0 0 0 
Multi-country programmes 0 0 0 
Other 0 0 0 
Total 7 40 44J 1993 1994 1995 Total 
0 
0 
0 
0 
0 
0 
0 
14.5 
14.5 
22 
0 
5 
0 
0 
0 
0 
56 35 
0 
0 
0 
0 
0 
0 
2.5 
0 
0 
0 
3 
0 
0 
0 
0 105 
15 
0 
0 
0 
0 
19 
17 
14.5 
65.7 
5 
8 
0 
0 
0 
0 
40.5 249.2 
41 
Infrastructure Public health 
1990 1991 1992 1993 1994 1995 Total 1990 1991 1992 1993 1994 1995 Total 
Albania 0 
Bulgaria 0 
Czech Republic 0 
Czechoslovakia 0 
Estonia 0 
GDR 0 
Hungary 0.8 
Latvia 0 
Lithuania 0 
Poland 6 
Romania 0 
Slovakia 0 
Slovenia 0 
Former Yugoslavia 0 
Multi-country programmes 0 
Other _0_ 
Total 6.8 0 
5 
0 
II 
0 
0 
7.5 
0 
0 
10 
9 
0 
0 
0 
0 
0 
42.5 4.4 
21 
0 
10 
0 
0 
0 
0 
0 
26.4 
0 
0 
0 
0 
35 
0 0 
13.9 
9 
0 
0 
0 
0 
0 
0 
63 
0 
5 
0 
0 
24 
0 23 
62.6 
25 
0 
6 
0 
29 
0 
16.5 
93.8 
25 
6.5 
6 
0 
31 
2 34 61.4 
48 150.5 
91 125 
0 21 
5 
0 
36 
9.2 
19 
91 
38 
8.2 
7.4 
0 
70.5 
0 II 
0 
73.3 
9.2 
35.5 
290.2 
72 
19.7 
13.4 
0 
160.5 
2 
96.8 114.9 326.4 457 3 1,044.7 Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Fonner Yugoslavia 
Multi-country programmes 
Other 
total 20 
25 
0 
0 
0 
0 
0_ 
45 0 
15 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
15 6 
10.5 
0 
0 
0 
0 
10 
0 
0 
0 
0 
0 
0 
0 
0 
(I 
26.5 7 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
6 
13 13 
25.5 
0 
0 
0 
0 
10 
0 
0 
20 
25 
0 
0 
0 
_ 6 
To 1.5 
Private sector development and enterprise 
support Public institutions and administrative reform 
Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Former Yugoslavia 
Multi-country programmes 
Other 
Total 1990 
0 
0 1991 1992 1993 1994 1995 Total 1990 1991 1992 1993 1994 1995 Total 
0 0 0 
20 22.5 
0 0 
39 31 
0 0 
0 0 
45.5 II 
0 0 
0 9.5 
0 74.5 
40 
0 
0 
0 
3 
0 27 
0 
0 
0 
31 
0 
0 
7 
70 
19 
0 
0 
27.5 
0 0 
3 
0 
0 
8 
0 
16.5 
0 
0 
9 
23.4 
0 
12.5 
0 
0 
21 0 
0 
1 
0 
9.1 
0 
6 
8.3 
9.6 
9 
0 
14.2 
3 
0 
5 
74 7 
51.5 
28 
70 
17.1 
0 
136 
8.3 
19.1 
193.5 
133.4 
33.2 
15.5 
0 
55.5 
95 Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Fonner Yugoslavia 
Multi-country programmes 
64 180.5 191.5 194.5 93.4 139.2 863.1 JDther 
Total 0 
0 
0 
0 
0 
0 
0 
0 
0 
10 
0 
0 
0 
0 
0 
0_ 
To 0 
0 
8 
0 
0 
7.5 
0 
0 
0 
0 0 
0 
0 
0 
0 
0 
14.5 
11 
0 
26.5 0 
0 
9.2 
0 
0 
0 
0 
1.5 
0 
25.2 1.2 
16 
0 
0 
0 
0 
1.5 
0 
0 
27 
10 
0 
0 
0 
10 
0_ 
65.7" 4.6 
1.2 
11 
0 
0 
0 0 
0 3 
0 1.3 
0 5.5 
21.5 2 
9.6 
25 
3 
"81.9 5.8 
17.2 
16 
0 
2.8 
0 
27 
1.3 
5.5 
77.2 
19.6 0 
5 9 
0 0 
0 2 
0 47.5 
_0 _ 3 
24\6 233.9 
42 
Social development and employment Other sectors 
1990 1991 1992 1993 1994 1995 Total 1990 1991 1992 1993 1994 1995 Total 
Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Former Yugoslavia 
Multi-country programmes 
Other 
Totaf 0 
2.5 
0 
15 
0 
0 
0 
0 
0 
18 
0 
0 
0 
0 
0 
0 0 
0 
0 
0 
0 
0 
26 
0 
0 
7.2 
15 
0 
0 
0 
0 
0 
35.5 48.2 0 
0 
14 
0 
0 
0 
0 
0 
0 
9 
0 
5.5 
0 
0 
0 
0 
28.5 0 
0 
2 
0 
2.9 
0 
2 
9.2 
4.4 
0 
0 
2.4 
4.4 
0 
0 
20 
47.3" 0 
6.5 
24 
15 
2.9 
0 
31 
9.2 
4.4 
34.2 
15 
10.9 
4.4 
0 
0 
20 
177.5 Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Former Yugoslav îa 
Multi-country piogrammes 
Other 
Total 0 
0 
0 
0 
0 
14 
0 
0 
0 
0 
0 
0 
0 
0 
0 
13.4 
"27.4" 0 
0 
0 
20 
0 
0 
0 
0 
0 
3 
22 
0 
0 
0 
1.5 
10 
56.5 4.4 
0 
0 
30 
9 
0 
4 
13.5 
9 
0 
20 
0 
6.7 
0 
0 
38.6 0 
1.5 
8 
0 
10.5 
0 
1 
16 
22.5 
27 
27 
5 
7.5 
0 
0 
54.9 
135.2 180.9 0 
0 
0 
0 
1.5 
0 
0 
4.5 
1 
0 
0 
5 
0 
0 
0 
43.5 
55.5 11.4 
1.5 
II 
50 
21 
14 
7 
34 
32.5 
30 
69 
10.6 
21.8 
0 
1.5 
67.4 227.8 
87.6 543 7 
0 
3 
0 
0 
0 
2 
0 
0 
0 
0 
0.6 
7.6 
0 
0 
Integrated regional measures 
1990 1991 1992 1993 1994 1995 Total 
Albania 
Bulgaria 
Czech Republic 
Czechoslovakia 
Estonia 
GDR 
Hungary 
Latvia 
Lithuania 
Poland 
Romania 
Slovakia 
Slovenia 
Former Yugoslavia 
Multi-country programmes 
Other 
Total 0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
0 
4.3 
0 
4.3 0 
0 
0 
0 
0 
0 
10 
0 
0 
0 
0 
0 
0 
0 
6.5 
0 
T6.5 8.5 
0 
0 
0 
0 
0 
5 
0 
0 
0 
0 
1.5 
0 
0 
0 
32 
47 8.5 
0 
0 
0 
0 
0 
15 
0 
0 
0 
0 
1.5 
0 
0 
24.8 
32 
81.8 
4.3 
Phare financial performance 
1995 saw Phare continuing to improve its financial 
performance. Phare has reached a situation where the 
contracting in a given year is at the same level as the 
commitments in that year. 
It is hoped that further efforts to be taken in 1996 to 
streamline procedures and to decentralise Phare 
effectively will enable these levels of contracting to be 
sustained and increased. 
The financial performance of the Phare Programme is 
indicated by the levels of funds committed, contracted and 
paid and the relationship between these three over time. Fig. 1 - Funds committed, contracted and paid 
1990-1995 (in ECU million) 
"3" o 
1990 1991 1992 1993 1994 1995 
The total amount of funds committed, contracted and paid 
for each of the years 1990 - 1995 are shown in Figure 1. 
The cumulative funds committed, contracted and paid 
over the same period are shown in Figure 2. 
Committed funds 
1995 saw the Phare Programme maintaining the high 
percentage of the Phare budget actually committed. As 
with previous years, this was close to 100 per cent at 99.4 
per cent of the 1995 budget. • commitments • contracts payments 
Fig. 2 - Cumulative funds committed, contracted and 
paid 1990-1995 (in ECU million) 
1992 
I commitments • contracts payments 
44 
Contracted funds 
Phare's increase in the amount of funds contracted 
continued during 1995 with the largest contracted amount 
(ECU 1,142.9 million) of any year since the Programme 
began. The budget year to which the contracts signed in each 
calendar year refer can be seen in Figure 3. 
Fig. 3 - Contracts concluded by calendar year 
(in ECU million) 
The improvement in contracting can be attributed to the 
following three factors 
• decentralisation - implementation structures in each of 
the partner countries are now in place and the efforts 
made in 1994 to standardise procedures, most notably 
through the distribution of the Decentralised 
Implementation System procedures manuals, started to 
bear fruit in 1995. Accordingly, 1995 was the first year 
in which the contracting level was higher among the 
Programme Management Units (PMUs) than in 
Brussels. 
• improved programme quality - improvements in 
programme design, especially in 1994, led to a faster 
execution of programmes and more efficient and 
effective contracting. 
• implementation review - during the first half of 1995, a 
systematic and detailed follow up of all programmes 
was undertaken. Through this process, programmes 
were reviewed, difficulties in implementation identified 
and measures designed to speed up implementation. 
This resulted in higher contracting levels. ^IM5_3 
1990 budget 1991 budget 1992 budget 1993 budget 1994 budget 1995 budget 
98.4% 99.0% 81.1% 59.6% 46.6% 21.1% 
% contracted as of 31.12.95 
contracted in 1990 • contracted in 1991 
• contracted in 1992 • contracted in 1993 
• contracted in 1994 • contracted in 1995 
• not yet contracted 
Funding procedure 
As part of the Phare Programme, there are three steps 
which take the annual budget approved by the 
Budgetary Authority through to the point where 
projects are implemented and funds disbursed. 
Phare has a financial management procedure which 
matches this process. 
Commitment - Each year a Phare budget is agreed, 
indicating the funds which the Commission is prepared 
to commit through the Phare Programme in each 
country. Country operational programmes are then 
designed and financing proposals prepared. Once these 
financing proposals have been given a favourable 
opinion by the Phare Management Committee and 
decided by the Commission, the relevant funds 
associated with these proposals are said to have been 
'committed'. Phare must commit its entire annual 
budget within the year to which that budget applies. Contracting - Once funds have been committed, 
tenders are issued so that the activities outlined in the 
operational 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 a key measure of the 
implementation of the Programme, as it is via the 
contracts that Phare 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. 
45 
Paid funds 
Payments in 1995 were 85.3 per cent of the budgeted 
amount. This was lower than the 1994 level of 99 per cent 
mainly because of two specific factors 
• the suspension of ECU 20 million of macro-economic 
aid to Albania, and 
• the difficulties in implementing cross-border co­
operation. 
Nonetheless, payments increased in 1995 by 5.5 per cent 
over 1994. 
Given the high level of contracting in 1995 and, 
previously, in 1994 it is anticipated that levels of 
payments will rise as these contracts run their course. 
The budget year to which the payments in each year relate 
can be seen in Figure 4. Fig. 4 - Payments in each budget year 
(in ECU million) 
1990 budget 1991 budget 1992 budget 1993 budget 1994 budget 1995 budget 
98.3% 92.3% 77.9% 54.5% 30.4% 5,5% 
% paid as of 31.12.95 
paid in 1990 paid in 1991 • paid in 1992 
• paid in 1993 • paid in 1994 • paid in 1995 
• not yet paid 
Cumulative contracts and payments as a 
percentage of cumulative commitments. 
These are important indicators. In the first place, they 
demonstrate the extent to which Phare has cut down the 
time taken between committing funds and issuing the 
necessary contracts. This is therefore a measure of the 
efficiency of Phare procedures. Secondly, they 
demonstrate the time taken between issuing the contracts 
and paying the funds. This is a both a measure of Phare's 
efficiency and an indicator as to the efficiency of project 
management on the ground. 
It is therefore encouraging that both ratios continued to 
improve in 1995. Cumulative contracts as a percentage of 
cumulative commitments grew 10 per cent from 1994 to 
62 per cent, and cumulative payments also showed a 
respectable increase of 3 per cent to 53%. The ratios over 
time are shown in Figure 5. Fig. 5 - Cumulative contracts and payments 
1990-1995 (%) 
1990 1991 1992 1993 1994 1995 
Cumulative contracts 
as percentage of 31.0 36.0 44.0 48.0 52.0 62.0 
cumulative 
commitments 
Cumulative payments 
as percentage of 35.0 36.0 39.0 43.0 50.0 53.0 
cumulative 
commitments 
46 
Major programmes launched in 1995 
Agriculture 
Agricultural and rural development programme 
Poland ECU 13 million 
Agricultural and rural development programme 
Hungary ECU 10 million 
Agricultural and rural development programme 
Romania ECU 10 million 
Agricultural programme 
Bulgaria ECU 5 million 
Agriculture and land registration programme 
Slovakia ECU 2.6 million Education and health 
Higher education reform programme 
Romania ECU 8 million 
Programme for social safety and health 
Estonia ECU 2.9 million 
Strategic measures for achieving 
reform targets (SMART) 
Poland ECU 7 million 
Vocational education and training, 
education reform, science and technology 
Bulgaria ECU 9 million 
Cross-border cooperation 
Cross-border cooperation programme 
Baltic Sea region 
Cross-border cooperation programme 
Czech Republic 
Cross-border cooperation programme 
Hungary 
Cross-border cooperation programme 
Slovenia 
Cross-border cooperation programme 
Slovakia 
Cross-border cooperation programme 
Poland 
Cross-border cooperation programme 
Czech Republic 
Cross-border cooperation programme 
Albania 
Cross-border cooperation programme 
Bulgaria 
Cross-border cooperation programme 
Albania 
Cross-border cooperation programme 
Slovenia ECU 14 million 
with Austria 
ECU 6 million 
with Austria 
ECU 7 million 
with Austria 
ECU 3 million 
with Austria 
ECU 4 million 
with Germany 
ECU 49 million 
with Germany 
ECU 25 million 
with Greece 
ECU 9 million 
with Greece 
ECU 23 million 
with Italy 
ECU 9 million 
with Italy 
ECU 3 million Energy 
Conventional energy programme 
Bulgaria ECU 5 million 
Conventional energy programme 
Romania ECU 21 million 
Energy infrastructure development programme 
Slovenia ECU 4.4 million 
ECU 4 million Energy programme 
Hungary 
Environment 
Environment programme 
Hungary 
Environment programme 
Poland 
Water management programme 
Hungary 
Infrastructure 
Infrastructure development programme 
Estonia ECU 5 million 
Infrastructure development programme 
Latvia ECU 6.2 million ECU 7 million 
ECU 18 million 
ECU 5 million 
47 
Infrastructure development programme 
Lithuania ECU 9.5 million 
Infrastructure development programme 
Slovakia ECU 5.2 million 
Infrastructure investment programme 
Czech Republic ECU 60 million 
Programme for technical support 
for the telecommunications and posts sector 
Romania ECU 12 million 
Public investment financing programme 
Lithuania ECU 5.5 million 
Transit facilitation programme 
Hungary ECU 8 million 
Transport and communications programme 
Hungary ECU 17 million 
Transport infrastructure programme 
Poland ECU 22 million Privatisation programme 
Hungary ECU 5 million 
Transport programme 
Albania 
Transport programme 
Bulgaria 
Transport programme 
Romania ECU 16 million 
ECU 20 million 
ECU 5 million 
Private sector development and enterprise 
restructuring 
Banking sector programme 
Latvia ECU 2.5 million 
Economic development programme 
Lithuania ECU 9.6 million 
Economic reform programme 
Estonia ECU 6.1 million 
Economic reform programme 
Latvia ECU 8.3 million 
Economic reform programme 
Slovenia ECU 7.6 million 
Foreign investment promotion programme 
Czech Republic ECU 1 million 
Private sector development programme 
Slovakia ECU 18.7 million Regional development and steel reconversion programme 
Hungary ECU 5 million 
Regional development programme (STRUDER II) 
Poland ECU 20 million 
Small and medium-sized enterprise programme 
Poland ECU 3 million 
Tourism programme 
Hungary ECU 1 million 
Tourism programme (TOURIN III) 
Poland ECU 6 million 
Public institution and administrative reform 
European integration programme 
Estonia ECU 2.8 million 
European integration programme 
Latvia ECU 1.3 million 
European integration programme 
Lithuania ECU 5.5 million 
European integration programme 
Slovakia ECU 5.55 million 
Framework programme for the approximation 
of national law to EU law 
Bulgaria ECU 2 million 
Human resources development programme 
Czech Republic ECU 2 million 
Human resources development programme 
Lithuania ECU 4.4 million 
Institutional and human resources development 
programme 
Slovenia ECU 4.4 million 
Institutional and human resources development 
programme 
Latvia ECU 9.2 million 
Programme for human resources development 
Estonia ECU 2.7 million 
Public administration reform programme 
Hungary ECU 3 million 
48 
Programme for institutional integration 
with the EU 
Czech Republic 
Safe society programme 
Poland 
Social development 
Social assistance programme 
Hungary 
Social protection, labour markets 
and health programme 
Slovakia 
Multi-country programmes 
Community action for cooperation in 
the field of economics (ACE) 
Cooperation in distance education 
Cooperation in higher education 
Democracy programme 
Environment project preparation 
facility 
Facility to support approximation of 
environmental legislation 
Intellectual property programme 
Interregional cooperation 
programme 
Know-how programme for 
preparation for integration into 
the internal market 
Link inter-European 
NGO programme (LIEN) ECU 5 million 
ECU 2 million 
ECU 2 million 
ECU 4.4 million 
ECU 10 million 
ECU 10 million 
ECU 3.5 million 
ECU 10 million 
ECU 15 million 
ECU 10 million 
ECU 2 million 
ECU 2 million 
ECU 18.5 million 
ECU 10 million Multilateral cross-border 
programme 
Partnership programme 
Programme for the energy sector 
Programme for the environment 
Programme for telecommunications 
and posts 
Programme to facilitate transit 
Programme to promote 
the establishment and development 
of joint ventures 
(JOP extension) 
Quality assurance programme 
Regional industrial property 
programme 
Social protection reform programme 
for the Europe Agreement countries 
Trade development programme 
Trans-European cooperation scheme 
for higher education (TEMPUS II) 
Transport programme 
Others 
General technical assistance facility 
Albania ECU 7 million 
Local community development programme 
Albania ECU 8.5 million ECU 12.95 million 
ECU 10 million 
ECU 9 million 
ECU 20 million 
ECU 7 million 
ECU 30 million 
ECU 50 million 
ECU 30 million 
ECU 4 million 
ECU 10 million 
ECU 5 million 
ECU 98.1 million 
ECU 11.5 million 
Technical assistance fund 
Czech Republic ECU 3 million 
49 




ISSN 0254-1475 • Com (96) 360 final • DOCUMENTS • EN • Catalogue number: CB-C0-96-363-EN-C 
ISBN 92-78-07160-9 • 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 - Phare 
Office Address Montoyerstraat 34 Rue Montoyer B-1000 Brussels Tel (+32-2) 299 16 00 / 299 14 44 / 299 15 55 
Mailing Address MO 34 3/80 Wetstraat 200 Rue de la Loi B-1049 Brussels Fax (+32-2) 299 17 77 English 
World Wide Web Address http://europa.eu.int/en/comm/dgla/phare.html E-mail phare.info@dgla.cec.be P/EN/08.96/02/02/11/B