WRITTEN QUESTION E-3105/01 by Yasmine Boudjenah (GUE/NGL) to the Commission. Practices of international financial institutions.
Date: 2001-11-13
Institutions: European Parliament, Provisional data
Subjects: Africa, International Monetary Fund, Latin America, development aid, institutional reform, price increase, privatisation, terms for aid, the EU's international role, water management

C 147 E/96

Official Journal of the European Communities

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20.6.2002

(2002/C 147 E/101)

WRITTEN QUESTION E-3103/01

by Yasmine Boudjenah (GUE/NGL) to the Commission

(13 November 2001)

Subject: Supply to third countries of equipment which might be used for internal repression

The Commission has already proposed regulations banning the supply to certain third countries of
equipment which might be used for internal repression. It did so in the case of Indonesia in October 1999,
and the Council adopted this regulation.

Is the Commission minded to propose this type of regulation in the case of other countries which carry
out campaigns of internal repression, for example Turkey, against the Kurdish population, and Morocco,
against the Western Saharan population?

Answer given by Mr Patten on behalf of the Commission

(7 January 2002)

In the framework of the Common Foreign and Security Policy, the Commission has proposed restrictions
on the exports of certain non-military equipment which might be used for internal repression, in line with
Common Positions adopted by the Council on the basis of Article 15 of the Treaty on European Union.

In this framework, the Commission and the Member States carefully review the situation of third countries
and will take the measures that are considered necessary to achieve the objectives of the Common Foreign
and Security Policy, where warranted.

Since, up to now, the Council has not adopted any restrictions on arms exports or other economic
sanctions against Turkey and Morocco, any proposal of that order would constitute a major change in EU
policy. The Commission does not, therefore, consider that there are grounds to propose restrictions on the
exports of certain non-military equipment to these countries.

(2002/C 147 E/102)

WRITTEN QUESTION E-3105/01

by Yasmine Boudjenah (GUE/NGL) to the Commission

Subject: Practices of international financial institutions

(13 November 2001)

In several African and Latin American countries loans granted by the IMF and negotiated with local
governments under the ‘Poverty Reduction and Growth Facility’ have imposed various conditions, one of
which being water privatisation. This privatisation of state-owned companies has led to a rise in prices,
making water even less accessible to large sections of the population in these countries.

Is the Commission aware of the dangers and serious repercussions of such practices on the part of
international financial institutions? What proposals will the Commission put forward to remedy them and
to ensure that these loans make a real contribution to reducing poverty in the countries concerned?

Answer given by Mr Nielson on behalf of the Commission

(7 January 2002)

The donor community has been shifting the focus of its aid and policy dialogue in support of country-
owned Poverty Reduction Strategic Papers (PRSPs). The donor community is shifting gradually from the

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old practice of externally imposed policy conditionalities by the Bretton Woods Institutions (BWI),
sometimes including rushed privatisations of public enterprises, which are not necessarily accompanied by
an adequate regulatory framework and institutions.

Policy dialogue with beneficiary countries is the key for reaching a common understanding on macro-
economic and sector policy reforms under PRSPs. The Commission, along with the Member States, has
been working closely with the BWIs to ensure that policy dialogue covers both the expected impact on
poverty reduction and on macro-economic stability. PRSPs endorsed by the BWIs imply that there is
generally a common understanding on envisaged policy reforms. The Commission plays an important role
in policy dialogue in the areas of concentration of its aid.

In its Poverty Reduction and Growth Facility, the International Monetary Fund (IMF) recognises country
ownership and promotes more pro-poor oriented expenditures and selective policy conditionalities. The
IMF is increasingly focusing on sound macroeconomic management secured through good fiscal,
monetary, income and foreign exchange policies rather than through structural reform conditionalities,
including privatisation.

The World Bank remains the key player in the area of structural and institutional reforms. If one of the
PRSP priorities is to increase access to safe water at affordable cost, policy measures suggest how to
achieve it. The policy choice will be agreed upon under a specific Bank operation. Well-conceptualised
privatisation needs to be accompanied by creating or strengthening the legal and regulatory framework, as
well as by institutional reforms to ensure that a private company will increase access to safe water by
complying with price and technical/hygienic regulations and standards.

The Commission is constantly in a dialogue with the World Bank on the principles and practices of
privatisation. Every case has to be judged on its own merit and the Commission has no ideological lias.

The Commission’s policy on the provision of water and sanitation services is based both on equity and
sustainability principles, taking into account needs of the poor. The policy choice is based on an analysis
of technical and economic options with a view to bringing about better services. Privatisation is one of the
options. However, experience seems to favour private/public partnership, with a strong participation by
beneficiaries and civil society. The pricing aspect is essential for the viability and maintenance of the
systems, and better management of water resources. Providing better services has a cost. In many instances
the poor may be already paying more than the rich for a lower quality service. Accompanying measures to
improve governance and management capacity, as well as training and awareness raising activities, play
also a key role in reaching sustainability, efficiency and equity in the provision of services.

(2002/C 147 E/103)

WRITTEN QUESTION E-3111/01

by Erik Meijer (GUE/NGL) to the Commission

(13 November 2001)

Subject: Accepting or resisting continuing efforts by the Microsoft IT corporation to use bundled software

to secure an unassailable monopoly position

Is the Commission aware that court proceedings in the United States aimed at forcing the Microsoft
1.
IT corporation to split
the one marketing operating systems and the other
applications software, are continuing, partly as a result of complaints lodged by a number of States against
a legal judgment overturning that requirement as handed down in a previous ruling?

into two companies,