WRITTEN QUESTION E-3563/98

by Klaus Lukas (NI) to the Commission

(1 December 1998)

Subject: The European Development Fund as a "milch cow"

In his book "The Lost Vision", Dr Nikolas Alexandrakis levelled serious accusations against the financial management of the Commission with regard to development aid. Thus, it is alleged that generous payments to dictators were made from the Lomé funds by order of the Director-General of DG VIII. The bloody regime of Sergeant Doe in Liberia, where Dr Alexandrakis was accredited as head of delegation of the EU Commission, is supposed to have been supported in this manner. It appears that Dr Alexandrakis informed the services in Brussels (DG VIII) that ministers and officials of the Doe regime considered the European Development Fund as a milch cow for their personal financial benefit (page 49). Thus, ministers are said to have regularly and systematically received a cut from the Commission funds allocated to development projects. Despite being aware of these circumstances, the leadership of DG VIII is supposed to have insisted on the continuation of these corrupt practices.

In view of this, can the Commission answer the following questions:

- Can the Commission say what sums have been or are being diverted by recipient countries from direct budget subsidies (Stabex, Sysmin) for military or repressive purposes?

- Can the Commission say what sums have been or are being diverted by recipient countries from its direct budget subsidies (Stabex, Sysmin) in order to finance potential and actual armies to wage civil war (eg. Sergeant Doe)?

- What possibilities are open to the Commission to prevent this?

- Has the Commission ever seriously attempted to prevent this?

- How does the Commission intend to stop the squandering of such vast sums in future?

Joint answer

to Written Questions E-3562/98 and E-3563/98 given by Mr Pinheiro on behalf of the Commission

(20 January 1999)

The Commission declines to comment further on the book in question than to state that it consists of malicious allegations made by a former official dismissed following disciplinary proceedings.

The policy implemented by the Commission under the Lomé Convention is formulated at Community level and agreed in partnership with the African, Caribbean and Pacific countries. The purpose of the projects, programmes, support for sectoral programmes and direct or indirect budget support alike is to contribute, together with the Member States and other donors, to the sustainable economic and social development of these countries. In other words, the ultimate beneficiaries of the aid should be local people in that the whole object of the exercise is to relieve poverty and raise living standards.

The Commission makes the necessary arrangements to see that both Stabex funds and other direct budget assistance observe this guiding principle, so that moneys intended as official development assistance are not diverted. If there appears to be any danger that payments might be put to ends other than those approved, i.e. covered by agreements signed by the recipient country authorities, the payments are not released. Regular audits are carried out and if the money has not been spent in the way set out in the financing agreement the funds are frozen until the situation has been rectified.

After the 1993 Abacha coup in Nigeria the Commission, on its own initiative, immediately froze all aid to the country; an EU common position subsequently endorsed the suspension of aid other than humanitarian relief sent direct to those in need.

Similarly, in the case of what was Zaire, the Commission likewise acted on its own initiative in 1992 to freeze European aid sent via Mobutu's authorities. Since then, at Community level, only humanitarian or rehabilitation operations implemented by non-governmental organisations (NGOs) or international organisations have been carried out in Zaire/the Democratic Republic of the Congo.