WRITTEN QUESTION E-0588/01

by Florence Kuntz (UEN) to the Commission

(1 March 2001)

Subject: European Union aid to Armenia

Could the Commission state:

- all the budget headings under which applications may be made for aid projects and/or projects to promote economic and cultural development in Armenia;

- all the Community programmes and actions in favour of Armenia, and their contents;

- all the EU appropriations, actions and programmes exclusively in favour of Armenia for the 2000 and 2001 financial years?

Can the Commission provide the results in figures, broken down by action, programme and budget heading, of the EU's aid policy towards Armenia and say what impact it believes this policy has had?

Joint answer to Written Questions E-0588/01 and E-0634/01 given by Mr Patten on behalf of the Commission

(11 April 2001)

Armenia is a beneficiary of programmes, projects and Community assistance and/or activities to promote economic and cultural development under the following budget headings:

- B7-520 Assistance to economic reform and recovery in the New Independent States and Mongolia, i.e. the TACIS programme, including Tempus (to overhaul higher education).

- B7-528 Exceptional financial assistance. This assistance is used to help Armenia meet the financial obligations generated by its external debt burden, especially that with the Community.

- B7-20 Food security programme. This programme supports the government's structural reforms in food-security related sectors.

The Fifth Framework Research and Technological Development Programme(1) (heading B6-120) is also open to Armenia.

Under heading B7-210 (EC Humanitarian Office ECHO) Armenia has received humanitarian emergency aid totalling 67 million since 1993 ( 0,6 million in 2000 to deal with the drought).

There are no other budget headings applicable to Armenia; Armenia is not the only country covered by the programmes, projects and other assistance under these headings.

Under the TACIS programme Armenia has received 59 million since 1991 and the budget for 2000-2001 is 10 million. On top of this, 50 billion has been accorded for nuclear safety over the period 2000-2004 as a result of the negotiations over the closure of the Medzamor power station, most of which will be used to dismantle the station, plus 30 million for the energy sector and 16 million for the TACIS Inogate programme (Interstate Oil and Gas Transport to Europe).

Armenia has received grants of 12 million in the form of exceptional financial assistance since 1997. There are macroeconomic and structural conditions attached to these grants, in accordance with the agreements with the IMF. Subsequent tranches up to 18 million by the end of 2004 will help reimburse the whole debt with the Community and 5,5 million are likely to be disbursed this year. Settling the country's non-concessional foreign debt on easy terms is one of the Armenian government's macroeconomic priorities.

Over the period 1996-1999 Armenia received 41 million under the food security programme. A new programme of about 20 million for 2000-2001 was approved in March 2000. The food security programme is also aiding the privatisation of farmland and the drafting of proper social and health policies.

Community aid for Armenia is designed to help the country establish sound democratic structures and implement reforms that will promote sustainable economic development and direct foreign investment, especially from the Community. While what has been

achieved so far is broadly satisfactory, the effectiveness of Community aid is diminished by the persistent conflict in the southern Caucasus. The lack of any real economic cooperation in the region and the difficulties the country is having in building up its economy are also factors that must be taken into consideration.

(1) COM(97) 553 final.