COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 20.11.1995 
COM(95) 582 final 
COMMUNICATION FROM THE COMMISSION 
Reconstruction in former Yugoslavia: 
EU AH) ADMINISTRATION AND 
INTERNATIONAL AID COORDINATION 

L Introduction 
In its communication to the Council of 2 October and subsequent texts on the subject, 
particularly the working document presented to the (General Affairs) Council meeting of 
30 October, the Commission stressed the demands which will be made of the 
international community as a whole, and the European Union in particular, in aid of the 
reconstruction of the former Yugoslavia. The reconstruction effort will require the 
combined forces of many donors including particularly the United States, fellow OECD 
members, the Islamic Conference countries and the international financial institutions. 
The contribution of the European Union and its Member States will involve major 
decisions on both the administration of Community aid (and the management of the 
projects concerned) and coordination of the efforts of all the agencies working on the 
spot, as well as the beneficiary countries. 
Given the EUs own considerable contribution plus its responsibility for seeing that 
political conditions are met, and its experience in supplying aid, it is bound to have to 
play a key role in coordinating aid. The international financial institutions will also be 
required to use their experience and influence so that, for example, essential coordination 
tasks could be devolved to the World Bank. 
With this perspective in mind, the Commission and the World Bank will devise a joint 
coordination scheme covering all reconstruction projects. The Commisron has been in 
close consultation with the World Bank for some weeks; following a Joi-.u -LVP.II ition 
mission to Sarajevo from 22 to 31 October and planning meetings in Washington n 9 
and 10 November, the two sides are largely in agreement on reconstruction in formai 
Yugoslavia and specifically on coordinating international aid to achieve it. The 
Commission and the World Bank are agreed that reconstruction will need to encompass 
political and economic reform in order to ensure that assistance efforts are implemented 
in a stable environment. They are also agreed that the regional dimension of coordination 
should be taken into account. The schemes set out in this communication are based on 
the coordination structure agreed with the World Bank. 
IL Administration of EU aid 
The EUs substantial contribution to reconstruction in former Yugoslavia requires 
provisions for administering Community funds for this purpose both within Commission 
departments and in the beneficiary countries. 
(a) In the Commission departments, the administration of funds specifically 
earmarked for reconstruction will mean restructuring the DGs immediately 
involved, which are currently understaffed and unsuited to the purpose. A new 
Task Force for Reconstruction in Former Yugoslavia is planned, to ensure 
transparency and coordinate the inputs of the relevant Commission departments. 
Other measures will be needed to ensure that the Commission can carry out the 
new tasks it is being given. 
(b) There will be a need lor similar measures on the spot in the beneficiary countries. 
The Commission has no delegations in the area at present,except in Belgrade — 
and Serbia will not be targeted for reconstruction aid proper. By contrast, there 
is no Commission team or representative in Bosnia-Herzegovina, which has been 
hard hit and is likely to receive a great deal of aid. The only potentially useful 
instrument for identifying and possibly implementing and monitoring 
reconstruction projects in Bosnia-Herzegovina is the IMG, which receives 40-42% 
of its resources from Community funds. 
Commission teams should therefore be sent to Bosnia-Herzegovina, and Croatia 
if necessary, on the understanding that their responsibilities will include 
coordinating their activities with those of other established donors. 
m. Coordination 
The extent of the international contribution, the number of donors and potential 
beneficiaries and the range of instruments available mean effective coordination of aid 
for reconstruction in former Yugoslavia is vital. As the Commission stressed in its 
proposals and the Council agreed in its document of 30 October, the parameters for such 
coordination are as follows: 
- effective use of available funds and sectors not covered by international aid; 
- use of the various donors' own expertise and know-how; 
- grouping together of as many donors as possible; 
- optimum transparency and availability of information on local needs and projects 
undertaken, and 
- the creation of structures in the beneficiary countries capable of absorbing 
international aid. 
The instruments of coordination are: a reconstruction conference, a small coordination 
body (Steering Committee) and local coordination structures. 
(a) Reconstruction Conference 
Only a joint effort by the international community will be up to the challenge of 
reconstruction in former Yugoslavia, and particularly Bosnia-Herzegovina. Any 
unilateral effort by a single country, group of countries or even international 
agency is likely to be doomed to failure. If the political stakes are to be fully 
grasped and substantial funds mobilized, it will be necessary to call an 
international conference on the reconstruction of Bosnia-Herzegovina as a whole, 
with the participation of all potential donors. The Commission plans to call such 
a conference jointly with the World Bank; the G7 has approved the idea. The 
conference will be held when circumstances permit, i.e. when sufficient progress 
has been made in the peace process, and will follow on from the London 
conference proposed by the British Government. 
Considerable preparation will be needed in terms of collecting data, establishing 
priorities, seeking funds, deciding who to invite (countries and international 
organizations) and drafting some conclusions. The Commission and the World 
Bank have been in agreement on working together on preparing the conference 
thus far. 
(b) Small coordination body 
The first step in coordinating reconstruction aid is to set up a small coordination 
body (a steering committee). This body must be able to issue recommendations 
on lines of action, general strategies and priorities. It should receive monitoring 
reports on reconstruction projects and be in a position to collate all relevant data 
on the needs identified, available resources and ongoing projects. It should also 
supervise compliance with the political and economic conditions for international 
aid and report regularly on aid implementation. It should be sufficiently 
representative without being larger than eight to ten members, and should meet 
no more than once a month. A database containing key information on aid for 
reconstruction should be created from the outset. 
(c) Local coordination structures 
If international aid is to be used effectively, we must create local coordination 
structures, which should include Steering Committee members. Thes bcvfe wi'l 
draw on the experience and advice of donors and beneficiaries. The Commission 
will be given the resources to take part in the local structures, and where the IMG 
already provides such a structure it will be necessary to make optimum use of it 
and adapt it for potential new tasks. On-the-spot coordination will require closer 
cooperation with national, cantonal and local authorities in countries receiving the 
aid. If technical assistance is needed to create such a structure, it must be 
supplied. 
IV. Conclusion 
For the administration of Community funds for reconstruction in former 
Yugoslavia, the Commission will take appropriate steps to furnish the necessary 
human and material resources both in Commission departments and locally in the 
beneficiary countries. 
- The Commission and the World Bank will call a donors' conference on the 
reconstruction of Bosnia-Herzegovina and will work together closely to this end. 
Aid coordination will be entrusted to a small body responsible for mapping out 
projects, strategies and general priorities. 
- Local coordination structures will be set up and will draw on the experience of 
the IMG. 
V 
ISSN 0254-1475 
COM(95) 582 final 
DOCUMENTS 
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Catalogue number : CB-CO-95-619-EN-C 
ISBN 92-77-96390-5 
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