Decision No 1/1999 of the ACP-EC Council of Ministers of 8 December 1999 on exceptional aid for highly-indebted ACP countries
Date: 1999-12-08
Institutions: ACP Council of Ministers
Subjects: ACP countries, EU aid, European Development Fund, indebtedness

28.4.2000

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Official Journal of the European Communities

L 103/73

II

(Acts whose publication is not obligatory)

COUNCIL

DECISION No 1/1999 OF THE ACP-EC COUNCIL OF MINISTERS

of 8 December 1999

on exceptional aid for highly-indebted ACP countries

(2000/307/EC)

THE ACP-EC COUNCIL OF MINISTERS,

Having regard to the Fourth ACP-EC Convention, as amended
by the Agreement signed in Mauritius on 4 November 1995,
and in particular Article 282(5) thereof,

Whereas:

(1)

(2)

(3)

(4)

(5)

(6)

The ACP countries have consistently and repeatedly
pressed for more ambitious initiatives to reduce their
external debt.

At the G7 summit in Cologne in June 1999, Ministers
approved an enhanced initiative to provide faster, deeper
and broader debt relief. As a result of the proposed
improvements the total cost of the initiative is set to
double, bringing it to a total of over USD 27,4 billion.

On 26 October 1999,
the Commission adopted a
communication on a Community participation in the
debt-relief initiative for highly indebted poor countries
(HIPCs).

Although significant sums have been pledged to finance
the HIPC initiative, further resources still need to be
mobilised to cover the full amount of the multilateral
share of the enhanced initiative.

Unallocated programmable resources from the eighth
European Development Fund (EDF) and its predecessors
are available for this purpose.

At the annual World Bank/IMF meetings in Washington
in September 1999,
the donor community took an
set of political decisions closely linking
amibitious
poverty alleviation strategies,
adjustment
programmes and the debt reduction initiative.

structural

(7)

(8)

(9)

A significant Community contribution to the HIPC Trust
Fund managed by the World Bank would play a crucial
part in ensuring the overall success of this initiative.

In this context separate decisions will be adopted in
accordance with the appropriate procedures to deal with
the external indebtedness of HIPCs other than members
of the ACP group, and budget resources should be used
for this purpose as part of the Community's develop-
ment aid policy for the countries of Asia and Latin
America.

The conclusions of the meeting held in Accra on 13
November 1999 between the Commission and the ACP
Development
Ministerial
Finance
Committee have been taken into account.

Cooperation

(10) A decision of

required in order
programmable resources,

the ACP-EC Council of Ministers is
to mobilise the abovementioned

HAS DECIDED AS FOLLOWS:

Article 1

Unallocated programmable resources from the eighth EDF and
earlier Funds may be used in the form of grants for the
following purposes:

(i) meeting the outstanding debt and debt-servicing obligations
to the Community of the first ACP countries which qualify
under the HIPC initiative (EUR 320 million);

(ii) contribution to the overall financing of the HIPC initiative
by providing up to EUR 680 million for the HIPC Trust
Fund managed by the World Bank.

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Article 2

Article 4

The aid referred to in Article 1(i) will be used for ACP countries
currently expected to qualify (i.e. reach their decision point)
before 2001. For countries which qualify at a later date, it will,
if necessary, be supplemented from further available EDF
resources on the basis of a further ACP-EC Council decision.

In line with other major multilateral creditors, the Community
will also use these resources to alleviate the debt-servicing
burden in the interim period of the HIPC initiative, on the
understanding that this contribution will be deducted from the
relief it is to provide subsequently at completion point.

The resources referred to in Article 1(i) and (ii) will be mobi-
lised in accordance with the rules and procedures for the
implementation of
financial cooperation under the ACP-EC
Convention.

Special arrangements will be made within the framework of
general coordination with other donors
to use the new
budgetary margin of manoeuvre generated by the Community's
contribution for the development of social sectors in the ACP
countries and for poverty alleviation.

Article 5

Article 3

The Commission is requested to take the measures necessary to
give effect to this Decision.

The aid referred to in Article 1(ii) will be mobilised in accord-
ance with a schedule and arrangements to be laid down by the
Commission taking into account both the needs of the coun-
tries concerned and actual disbursements made by other
donors.

Without prejudice to the use of resources from the Community
budget of the benefit of non-ACP countries, the contribution
referred to in Article 1(ii) will be assigned solely to ACP
countries, with particular reference to the needs of the African
Development Bank.

This Decision shall enter into force on the day of its adoption.

Article 6

Done at Brussels, 8 December 1999.

For the ACP-EC Council of Ministers

The President

J. HORNE