Annual Report 2003 from the Commission to the Council and the European Parliament on the EC development policy and the implementation of external assistance in 2002
Date: 2003-09-03
Institutions: European Commission
Subjects: activity report, aid evaluation, aid policy, cooperation policy, development aid

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 3.9.2003
COM(2003) 527 final

ANNUAL REPORT 2003 FROM THE COMMISSION
TO THE COUNCIL AND THE EUROPEAN PARLIAMENT

ON THE EC DEVELOPMENT POLICY AND THE IMPLEMENTATION OF
EXTERNAL ASSISTANCE IN 2002

ANNUAL REPORT 2003 FROM THE COMMISSION
TO THE COUNCIL AND THE EUROPEAN PARLIAMENT

ON THE EC DEVELOPMENT POLICY AND THE IMPLEMENTATION OF
EXTERNAL ASSISTANCE IN 2002

TABLE OF CONTENTS

FOREWORD................................................................................................................5

EXECUTIVE SUMMARY ..........................................................................................7

STRATEGIC GOALS AND ACHIEVEMENTS ......................................................12

The framework for the community’s external partnerships .......................................12

Adapting to Changes in the EU and Global Context during 2002 .............................15

Key Achievements during 2002 .................................................................................17

The Three Cs: Coherence, Coordination and Complementarity.................................18

Working with Others ..................................................................................................25

The Path to the Future.................................................................................................27

THE REFORM PROCESS - STEPS FORWARD IN 2002.......................................29

QUALITY IMPROVEMENT ....................................................................................29

Improving financial management and performance ...................................................31

Further reunification of the project cycle : EuropeAid co-operation Office’s
second year .................................................................................................................32

Deconcentration..........................................................................................................34

ONGOING PROGRESS TOWARDS STRATEGIC GOALS ..................................38

Monitoring Progress Towards Strategic Goals...........................................................38

Maximising the impact of EC assistance....................................................................45

Policy developments in 2002 in priority areas ...........................................................49

LOOKING FOR RESULTS: MONITORING AND EVALUATION.......................71

Evaluation ...................................................................................................................71

Project results : results-oriented monitoring...............................................................76

Conclusions.................................................................................................................83

HORIZONTAL ACTIVITIES AND MAINSTREAMING .......................................84

A.

B.

1.

1.1

1.2

1.3

1.4

1.5

1.6

2.

2.1

2.2

2.3

2.4

3.

3.1

3.2

3.3

4.

4.1

4.2

4.3

5.

2

5.1

5.2

5.3

5.4

5.5

5.6

5.7

5.8

5.9

6.

6.1

6.2

6.3

6.4

6.5

6.6

7.

7.1

7.2

7.3

8.

Mainstreaming Human Rights and democracy issues within the EU.........................84

European Initiative for Democracy and Human Rights (EIDHR)..............................86

Equality between women and men .............................................................................91

Combating drugs.........................................................................................................92

The environment and tropical forests .........................................................................93

Conflict prevention, rapid response to crisis and fight agains terrorism ....................95

Science and Technology cooperation - policy dialogue and capacity building..........99

Health, aids and population ......................................................................................100

Cooperation with non-state donors including NGOs................................................101

ACTIVITIES IN 2002 ..............................................................................................107

Western Balkans .......................................................................................................109

Eastern Europe and Central Asia..............................................................................127

Mediterranean, Near and Middle East ......................................................................149

African, Caribbean and Pacific (ACP) countries and overseas countries and
territories (OCTs)......................................................................................................172

Asia ...........................................................................................................................199

Latin America ...........................................................................................................223

FEATURE: WATER MANAGEMENT IN EU CO-OPERATION ........................244

The importance of water for development................................................................244

Water and the millenmium developemnt goals ........................................................246

People and water improving access to water and sanitation services.......................246

FINANCIAL TABLES.............................................................................................256

8.1.

Commitments 2002 Western Balkans ......................................................................262

8.2

8.3

8.4

8.5

8.6

9.

9.1

9.2

Commitments 2002 Eastern Europe and Central Asia .............................................273

Commitments 2002 Mediterranean, Near and Middle East .....................................276

Commitments 2002 - ACP .......................................................................................283

Commitments 2002 Asia ..........................................................................................301

Commitments 2002 Latin America ..........................................................................305

ANNEXES................................................................................................................311

Harmonisation of contract and financial procedures ................................................311

RAL ..........................................................................................................................312

3

9.3

9.4

9.5

9.6

9.7

Legal affairs ..............................................................................................................327

Audits........................................................................................................................328

Transparency and visibility.......................................................................................330

EC communications referring to external assistance in 2002...................................332

EC assistance not covered by this report ..................................................................334

4

A.

FOREWORD

Poverty, conflict, instability and human misery, wherever they are in the world, affect us all.
In  this  age  of  globalisation  it  is  in  our  common  European  interest,  as  well  as  a  moral
imperative, to address these issues. The EC's external assistance programmes are a response
to this reality.

The  Commission,  on  behalf  of  the  European  Community,  manages  one  fifth  of  the  EU’s
overall  aid  flows  (€  6.5  billion  committed  in  2002),  which  represents  over  ten  percent  of
global  aid.  We  provide  assistance  to  more  than  160  countries,  territories  or  organisations
worldwide.  We  believe  in  long-term,  structured  commitments  and  in  building  a  network  of
collaborative partnerships.

In  pooling  resources  for  this  common  purpose,  EU  Member  States  have  shown  their
commitment  to  the  common  values  of  external  assistance,  Human  Rights,  stability,  poverty
reduction, whose policies and implementation are central to the EU's role in the world.

As  administrator  of  EC  External  Assistance,  the  Commission  has  a  unique  comparative
advantage, drawing on the  expertise and  transcending the  national traditions of the  Member
States.  We  are  committed  to  spending  European  taxpayers’  money  to  deliver  high  quality
programmes  of  assistance  that  have  a  demonstrable  impact  on  the  quality  of  people's  lives.
We aim to do this with a level of efficiency that meets the highest international standards.

In  2002,  this  approach  was  demonstrated  notably  in  the  €  275  million  we  committed  to
Afghanistan: a concrete contribution to the rebuilding of a failed state, supporting a fledgling
government to build better lives for ordinary people. The Commission also played a vital role
in  the  Conference  on  Financing  for  Development  (Monterrey),  the  World  Summit  on
Sustainable  Development  (Johannesburg),  the  Doha  Development  Agenda,  and  in  the
adoption  of  the  Barcelona  Commitments  and  the  launching  of  EU  Initiatives  on
Water/Sanitation and Energy.

This  Commission  made  it  a  priority  to  reform  the  way  we  deliver  the  external  assistance
budget,  and  2002  was  the  year  where  the  first  results  of  this  reform  could  be  seen  on  the
ground:  The  quality  of  our  assistance  has  been  boosted  by  a  huge  deconcentration  of
management responsibilities away from Brussels out into the field, which in 2002 took place
for  geographical  programmes  in  Europe,  the  Mediterranean,  Asia  and  Latin  America.
Following international best practice, we are now not only quicker at implementation – in line
now  by  and  large  with  the  performance  of  national  development  agencies  -  but  better  at
trouble-shooting  and  tailoring  our  help  to  meet  real  needs.  These  gains  have  been
complemented  on  the  programming  side  by  a  new  framework  of  Country  strategies  that
promote policy coherence and donor coordination.

This report provides information on policies and programmes implemented across the world.
It responds to the request of the Council and the European Parliament to focus on results and
impacts achieved. We  recognise that further  work  is  required in  the  move  towards  a  results
based  approach.  It  will  take  much  more  time  and  effort  to  consolidate  and  complete  the
reform  and  further  improve  the  effectiveness  of  external  assistance.  Particular  challenges
include the need to address specific implementation difficulties faced by the Commission in a
number of ACP countries and the imperative to deploy effective financial instruments towards
our new neighbours after the enlargement in 2004, in the context of “Wider Europe”. We are

5

committed  to  meeting  these  challenges  and  to  further  improving  the  performance  of  EC
external assistance, thus contributing to security and prosperity for all.

Chris  Patten,  Member  of 
Chairman of the Board of the EuropeAid Co-operation Office

the  Commission 

responsible 

for  external 

relations

Poul  Nielson,  Member 
Chief Executive Officer of the Board of the EuropeAid Co-operation Office

the  Commission 

responsible 

of 

for 

development

Günter  Verheugen,  Member  of 
the  Commission 
Member of the Board of the EuropeAid Co-operation Office

responsible 

for  enlargement

Pascal 
Member of the Board of the EuropeAid Co-operation Office

Lamy,  Member 

Commission 

the 

of 

responsible 

for 

trade

Pedro  Solbes  Mira,  Member  of  the  Commission  responsible  for  economy  and  finances
Member of the Board of the EuropeAid Co-operation Office

6

B.

EXECUTIVE SUMMARY

This Annual Report presents an overview of the European Community’s activities undertaken
in the field of External Assistance.  It must be  placed in the framework  of  the  reform  of  the
management of EC external aid adopted by the Commission1. It is addressed to the European
Institutions,  other  actors  in  the  field,  partner  countries  as  well  as  the  general  public.  This
report accounts for the € 6.5 billion committed and the € 5.2 billion actually disbursed by the
EC in 2002.

Chapter 1 of the report presents the state of play of the strategic goals and achievements.
Monterrey  and  Johannesburg  summits  settled  the  bases  for  a  new  global  partnership  for
poverty eradication and sustainable development. If the EU Member States comply with their
pledges, some extra € 8.5 billion could be available by 2006. The first generation of Country
Strategy  Papers  has  been  completed  in  2002.  They  will  lead  to  accrued  focus  on  fighting
poverty.  A  better  integration  of  the  international  evolving  context  and  of  the  other  EU
priorities into development policy  and planning will also add to  the overall  improvement of
EU  activities  in  the  field.  Not  to  forget  the  already  famous  “Three  Cs”  (coherence,  co-
ordination  and  complementarity)  where  a  steady  advance  can  be  registered.  Within  EC
policies,  they  help  promote  development,  poverty  reduction  and  integration  of  the
beneficiary/partner countries into the world economy . This chapter also shows the progress in
the field of EC co-operation with other donors. A new framework agreement has been signed
with the World Bank, and the revision of the EC-UN Framework Agreement for EC funding
of  UN  projects  was  completed.  Extensive  upstream  policy  dialogues  at  various  levels  took
place in 2002 with United Nations’ agencies, funds and programmes.

The  reform  of  the  management  of  the  EC  External  Assistance  starts  bearing  its  fruits:
sharper  programming,  improved  quality  and  delivery  timing,  greater  transparency  and
accountability, devolution  of  responsibilities  to  delegations  on  the  spot,  better  co-ordination
with  other  donors,  especially  Member  States,  and  the  implementation  of  a  new  single
management information system Common Relex Information System (CRIS) are amongst its
main results in 2002 as shown in Chapter 2.

Chapter 3 outlines the progress the EC is making towards its strategic goals, in particular
the  Millennium  Development  Goals  (MDGs),  working  with  the  rest  of  the  international
community.  It  highlights  measures  being  taken  to  enhance  the  effectiveness  of  the
Community’s assistance still further, including adapting its approach to different country and
regional circumstances,  effective targeting of resources, debt sustainability,  increased use of
sector  wide  approaches  and  budget  support.  It  also  outlines  progress  towards  focusing  the
EC’s  assistance  on  a  more  limited  number  of  areas,  and  key  policy  developments  in  these
priority  areas  during  2002.  Social  sectors  like  Health  and  Education,  Transport  and  Food
Security have all seen significant progress  during the  year. On Trade and  Development,  the
Commission adopted a Communication endorsed by the Council in November 2002.

The  Commission  has  worked  with  an  expert  group  of  Member  States  and  other  interested
parties,  including  the  OECD  Development  Assistance  Committee  (DAC),  UNDP  and  the
World  Bank,  to  develop  a  core  set  of  10  indicators  drawn  from  the  MDGs.  Of  these  10
indicators,  six  are  directly  related  to  the  well  being  of  children,  while  three  have  a  specific
gender  dimension.  The  Commission  intends  to  monitor  progress  against  these  indicators
annually for all developing countries to which it provides assistance. They are:

1

Communication on the Reform of External Aid Management SEC (2000)814 of 16.05.2000

7

                                                
– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

Proportion of population below $ 1 per day

Prevalence of underweight children

Under-five mortality rate

Net enrolment ratio in primary education

Primary education completion rate

Ratio of girls to boys in primary, secondary and tertiary education

Proportion of births attended by skilled health personnel

Proportion of 1 year old children immunised against measles

HIV prevalence among 15-24 year old pregnant women

Proportion of population with sustainable access to an improved water source.

Chapter 4 shows the 2002 findings of the Evaluation activities and the Results-Oriented
Monitoring (ROM). The chapter summarises the findings and conclusions of the evaluations
completed during the reporting period and points out certain emerging broad issues. Launched
in 2001, the Results-Oriented Monitoring (ROM) has been extended to all regions in 2002. It
ensures that the Commission has comparable data across its external assistance programmes.
The chapter shows findings and analysis based on 2002 reports by ROM criteria (Relevance,
Efficiency, Effectiveness, Impact and Sustainability) and on the priority development fields.

Results  achievement  and  performance  of  EC  funded  projects  and  programmes  have  been
judged  as  being  generally  good.  Analysis  of  the  structure  of  performance  suggests  some
lessons to be learned:

– 

– 

– 

– 

Flexibility  and  capacity  to  adapt  to  changes  tends  to  enhance  the  performance  of
projects. There are also indications  suggesting  that  a  review  of  the  project  concept,
when it actually starts implementation, did foster better performance.

Good  integration  in  local  structures,  policy  support,  and  beneficiary  involvement
clearly  foster  effectiveness  and  sustainability  and  should  be  given  attention  in  the
design of projects.

Financial sustainability is identified most often as a potential source of problems for
projects.

Timeliness  of  inputs  and  activities  is  suboptimal  in  many  projects,  the  narrative
comments  in  monitoring  reports  indicate  heavy  (EC)  procedures  and  quality  of
project management as reasons in many cases.

Chapter  5  analyses  the  “horizontal”  or  “cross-cutting”  issues  and  their  mainstreaming
through the general structure of EC co-operation. Human Rights, Equality between men and
women, Environment and Conflict Prevention are the main topics of this chapter which also
describes the implementation of thematic budget lines such as Food Security, Tropical Forest,
Fight against AIDS or Co-financing with NGOs.

8

Dialogue  on  Human  Rights  has  continued  with  China  and  started  with  Iran.  Regional
meetings  have  been  held  in  two  Mediterranean  countries  with  civil  society  organisations  in
these countries. Promotion of Human Rights education and Training for ethical review have
also  been  important  issues  in  2002.  The  European  Initiative  for  Democracy  and  Human
Rights has committed over €100 million this year. Assistance to third countries in the field of
Science, Technology and Research, particularly in the New Independent States and the ACP
countries, deserves also a place in this chapter.

The Rapid Reaction Mechanism committed € 23.5 million in 2002, the most important task
being  the  second  phase  of  stabilisation  in  Afghanistan  and  the  reconstruction  efforts  in  the
Palestinian Territories.

A process of consultation with Non-State actors has been developed in 45 countries during the
preparation of Country Strategy Papers. Close to € 200 million have been committed for co-
financing NGOs projects. Almost 50 million have been committed under the thematic budget
lines Environment and tropical Forest.

Chapter  6  focuses  on  co-operation  activities  by  region::  Eastern  Europe  and  Central  Asia,
South-eastern  Europe,  the  Mediterranean,  Near  and  Middle  East,  African,  Caribbean  and
Pacific Countries (ACP) and Overseas Countries and Territories (OCTs), Latin America and
Asia.  The  structure  of  the  presentation  is  the  same  for  each  region,  allowing  for  a
“transversal” reading and easy comparison based on similar data. At first, the strategic goals
and  achievements  are  presented  as  well  as  the  programming  priorities  during  the  year.
Secondly, a section presents the main results of both finalised and ongoing projects, including
those  for  which  a  mid-term  review  has  been  undertaken.  Some  case  studies  illustrate
concretely the scope of EC activities in each region.

To complete the information on each region, specific sections focus on the implementation of
the “Three Cs” (Coordination, Coherence and Complementarity) describing the co-operation
with  Member  States  and  other  donors.  Humanitarian  Aid  (implemented  by  ECHO)  and
European Investment Bank (EIB) activities are also highlighted. Conclusions and perspectives
for the years to come end each regional contribution.

As regards the Western Balkans, the existence and proper functioning of a market economy
is  one  of  the  criteria  fixed  at  Copenhagen  as  basic  pre-requisite  for  EU  membership.  The
coming  years will therefore see  continued  support  for  the  reforms  necessary  to  achieve  this
objective, including inter alia economic related legislation, budget expenditure management
and revenue collection, public procurement and – at the more advanced stages of the process
– competition legislation.

Attention  will  also  be  focused  on  public  administrations,  usually 
through  Public
Administration  reform  programmes,  aimed  at  supporting  the  process  of  rationalising,
downsizing and streamlining the public sector.

In  the  area  of  Justice  and  Home  Affairs,  the  weak  functioning  of  the  judiciary  system  is
recognised as one of the key problems hindering not only the general political functioning of
the state, but also the proper functioning of a market economy (e.g. lack of effective economic
conflict resolution). Corruption has been identified as another major issue that hinders proper
political,  social  and  economic  development  in  the  region.  It  requires  decisive  action  by  the
International Community, supported by targeted CARDS assistance, to attack the roots of the
problem and facilitate sustainable solutions. Nearly  € 654 million have been  committed  and
more than 617 million disbursed in the region in 2002.

9

Concerning  Eastern  Europe  and  Central  Asia  countries,  almost  €  430  million  were
committed  and  €  383  million  disbursed  ,in  2002.  Work  has  begun  to  assess  the  potential
impact of enlargement on EU relations with Eastern Europe countries, within the framework
of  the  “Wider  Europe”  concept,  which  aims  at  enhancing  stability  and  narrowing  the
prosperity gap on the new external borders of the EU. This will lead to increased support for
activities  that  promote  cross-border  co-operation,  particularly  with  respect  to  the  Western
NIS.

In  the  Caucasus  and  Central  Asia,  the  EU  will  continue  to  prioritise  regional  co-operation,
notably  through  measures  aimed  at  poverty  reduction  and  economic  growth  and,  where
appropriate, conflict prevention.

Concerning  the Mediterranean countries, a significant  improvement has  been  achieved on
MEDA  programme’s  implementation,  with  €  762  million  commitments  and  €  684  million
disbursements  over  the  year.  The  new  national  Indicative  Programmes  have  been
implemented  for  the  first  time  in  2002.  Stability,  security  and  sustainable  development
continue  being  EU  priorities  in  the  region  as  well  as  the  completion  of  the  Association
agreements  with  all  the  Mediterranean  partner  countries  and  further  steps  ahead  towards  a
Euro-Mediterranean internal market.

Co-operation  in  Legal  matters  and  Home  affairs  is  also  becoming  an  important  priority
covering  issues  such  as  refugees,  Asylum  rights  and  fighting  against  illegal  immigration.
Middle East situation stays the main concern in the region.

Co-operation  with  the  ACP  countries  and  Overseas  Countries  and  Territories  (OCTs)
has totalled almost  €  2.4  billion commitments, and  € 2.54  billion disbursements (one  of the
best  peformance  ever  recorded  even  if  slightly  inferior  to  2001  disbursements).  The
ratification  of  Cotonou  agreement  will  allow  for  evolving  EU-ACP  relations.  The  explicit
commitment of African countries to strengthening their capacity to deal with conflict, poverty
and  marginalisation  in  the  context  of  globalisation  and  the  existence  of  Poverty  Reduction
Strategy Papers are two important pillars for the future EC co-operation in the region to base
upon.  Being  the  one  region  in  the  world  that  will  struggle  most  to  reach  the  Millennium
Development Goals (MDGs), the ACP-EU partnership must improve development assistance,
political dialogue and other policies and instruments as in trade-related issues. The launch of
the  African  Union  and  its  adoption  of  the  New  Partnership  for  African  Development
(NEPAD) may become the most significant fact in 2002 for the near future. Capacity building
and crisis solution are also among the most important concepts to deal with in this region.

During 2002, € 540 million have been committed and 434 million disbursed in Asia. Through
its  co-operation  activities,  the  EC  strives  to  make  a  contribution  to  reducing  poverty  and
raising  the  standard  of  living  in  Asian  countries.  Basic  health  and  primary  education  are
priority  areas  in  this  regard  and  will  continue  to  receive  at  least  one  third  of  the  available
funds.  The  focus  will  be  on  intervention  at  the  sectoral  level,  fighting  poverty  through
country-owned  programmes  and  enhanced  donor-country  co-ordination.  The  role  of  the
Community also extends to achieving an improved relationship between these countries and
the EU, to promoting greater democracy and to fostering peace. This involves, for example,
supporting  the  reconstruction  and  rehabilitation  of  countries  affected  by  conflicts  such  as
Afghanistan and East Timor, and activities aimed at conflict prevention in the region, such as
supporting the peace process in Sri Lanka.

10

Economic co-operation with Asia will be strengthened, focusing in particular on the business
environment  while  supporting  activities  in  such  key  fields  as  energy,  environmental
technology and bio-diversity.

Dialogue and negotiations have been the key words in EC co-operation with Latin America.
Civil  society  is  being  consulted  on  the  three  sub-regional  negotiations  (UE-Mercosur,  UE-
Mexico  and  UE-Chile).  Madrid  Summit  conclusions  may  be  an  important  step  ahead.  The
sectoral approach and budget support might give their first results in the region as soon as in
2003. On the other hand, the launching of negotiations with Central American countries and
the  Andean  Community  may  drive  to  a  full  sub  regional  structure  for  EU-Latin  America
relations  in  the  future.  In  2002,  EC  commitments  in  the  region  have  amounted  to  €  382
million while disbursements reached € 272 million.

The “Feature article” (Chapter 7) in this report concerns Water Management, probably the
most  important  challenge  for  any  coherent  development  policy  in  the  years  to  come.  The
Commission Communication of 12 March 2002 as well as the outcome of Johannesburg is the
basis  of  any  EU  policy  in  this  regard.  The  EU  Water  Initiative,  launched  at  Johannesburg,
seeks  to  provide  a  catalyst  for  further  action  to  achieve  the  internationally  agreed  goals,
working  in  partnership  with  developing  countries.  The  new  international  target  is  now  to
halve by 2015 the number of people without access to sanitation to complement the target on
access to drinking water as per the Millennium development Goals.

Ccomplete financial tables, following DAC nomenclature, make up chapter 8. Breakdowns
per budget line, region, country and instrument can be found in these pages. At the same time,
each and every project committed in 2002 is mentioned per region and sector of intervention.

Finally,  the  annexes  show  the  state  of  play  of  the  main  works  related  to  the  reform  of  the
management  of  the  external  assistance,  i.e.  harmonisation  of  procedures,  RAL  situation
(payments backlog), audits carried out, efforts in transparency and visibility as well as a full
list of official EC Communications referring to external assistance produced in 2002.

11

1.

STRATEGIC GOALS AND ACHIEVEMENTS

This  chapter  explains  the  context  for  the  Community’s  external  partnerships,
including  the strategic framework  and objectives,  and  outlines the  evolution  in  this
during 2002 in response to events both within and outside the EU. It also highlights a
number  of  strategic  achievements  during  the  year  including  the  completion  of  the
country  programming  process,  and  concrete  progress  towards  improved  coherence,
coordination and complementarity both within and beyond the EU.

1.1

The framework for the community’s external partnerships

The  European  Community’s  development  cooperation  policy  is  one  of  three
elements  within  the  broader  framework  of  external  relations.  It  sits  alongside  the
Community’s  external  political  and  economic  (including  trade  and  investment)
relations.

The  European  Community  has  a  very  substantial  role  in  all  three  areas.  It  is  the
largest trading partner for many developing countries. The EU, as a region, provides
more  than  half  of  global  development  assistance:  over  €  28.7  billion  in  2002,  of
which  €  6.5  billion  at  EC  level.  In  March  2002,  at  the  time  of  the  international
Financing for Development conference, the EU signalled its commitment to play an
even larger role in future by further increasing aid volumes. Each EU Member State
has  pledged  to  provide  by  2006  a  minimum  of  0.33%  of  its  national  income  as
Official  Development  Assistance  (ODA)  so  that,  collectively,  the  EU  reaches  an
average ratio of 0.39% (up from 0.33% in 2001). One fifth of the EU’s  current aid
budget  –  €  6.5  billion  -  is  managed  by  the  European  Commission  on  behalf  of  the
Community. These funds come from the Community budget as well as the European
Development Fund (EDF), which provides support to African, Caribbean and Pacific
countries  within  the  framework  of  the  Cotonou  Agreement  and  to  the  Overseas
Countries and Territories (OCTs) associated with the Community under the Overseas
association  Decision2  The  geographical  span  of  the  Community’s  assistance
programmes is also substantial: from the EU’s neighbours to small Pacific islands. In
2002,  the  Community  had  programmes  with  160  countries  and  8  regions.  The
situation  and  the  key  issues  in  each  region  and  country  vary  significantly  and  the
Community adapts its approach accordingly.

1.1.1

The Strategic Objectives of EC’s Development Policy

Whilst  development  cooperation  is  part  of  external  relations,  it  is  also  a  legitimate
policy  objective  in  its  own  right.  In  addition,  the  Commission  promotes  the  use  of
Information  and  Communications  Technologies  (ICTs)  as  a  tool  to  achieve
development objectives.

Since November 2000, the  Community has  had  one  overall  framework  to  guide  its
cooperation  and  partnerships  with  all  developing  countries  with  which  it  has  links.
This  makes  clear  that  the  main  objective  of  the  Community’s  development
cooperation policy is to reduce and eventually eradicate poverty, through support for
economically,  socially  and  environmentally  sustainable  development,  promotion  of

2

Council Decision 2001/822, 27.11.2001, OJ L 314 of 30.11.2001

12

                                                
the  gradual  integration  of  the  developing  countries  into  the  world  economy  and  a
determination to combat inequality.3 Health targets feature prominently, highlighting
the  link  between  overall  poverty  reduction  and  investments  in  health  and  research.
The specific goal related to the fight against HIV/AIDS, malaria and other diseases
indicates  a  strong  commitment,  acknowledging  that  without  addressing  these
diseases  the  central  outcome  of  global  poverty  reduction  will  not  be  met.  It  also
makes  clear  the  core  principles  on  which  the  Community’s  assistance  is  grounded:
sustainable,  equitable  and  participatory  human  and  social  development,  with  the
promotion of Human Rights, democracy, the rule of law and good governance as an
integral  part  of  this.  Increasingly,  the  value  of  Science  and  Technology  (S&T)
capacity building and innovation is recognised as  critical to the achievement  of the
MDGs,  both  in  the  different  sectors  as  well  as  in  support  of  overall  economic
development.

The EU has set its development efforts firmly in the global context, and is working
with  others  to  achieve  the  set  of  Millennium  Development  Goals  endorsed  by  UN
Members at the Millennium Summit. The headline goals are given in Box below.

The Millennium Development Goals

Achieve universal primary education

Promote gender equality and empower women

Reduce child mortality

Improve maternal health

Combat HIV/AIDS, malaria and other diseases

Eradicate extreme poverty and hunger

Ensure environmental sustainability

– 

– 

– 

– 

– 

– 

– 

The Community has also committed to apply international best practice principles in
implementing its assistance. This includes a firm commitment to work in partnership
with  developing  countries  and  to  respect  and  promote  local  ownership,  as  well  as
participation  by  non-state  actors  and  other  measures  such  as  effective  targeting  of
resources, close working with other donors, and a shift away from projects towards
sectoral  programmes  and  budget  support  where  possible  (see  Chapter  3).  This  is
complemented  by  the  management  reform  programme  also  launched  in  2000  (see
Chapter 2).

In order to maximise its own impact within the global development framework, the
Community is focusing its assistance in 6 areas where it can add particular value: the
link  between  trade  and  development;  regional  integration  and  cooperation;  support
for  macroeconomic  policies  and  equitable  access  to  social  services;  transport;  food
security and rural development; and institutional capacity building in particular good
governance  and  the  rule  of  law  (see  Chapter  3).  The  promotion  of  Human  Rights,
equality  between  men  and  women,  environmental  sustainability  and  conflict

3

Council Conclusions of 10 November 2000, Reference 12929/00

13

                                                
prevention are integrated at every stage and within all of the Community’s assistance
programmes.

1.1.2

Responding to Different Country and Regional Circumstances

The  development  cooperation  policy  outlined  above  applies  to  all  developing
countries  with  which  the  Community  has  links.  Nevertheless,  the  Community’s
relations and assistance programmes in different regions and countries are adapted to
the specific challenges facing these.

This ranges from political and economic reform and stability in the Western Balkans,
to sustainable economic and social development in the Mediterranean to ensure that
this region does not become a geostrategic faultline with a prosperous Europe on one
side  and  predominantly  poor  countries  on  the  other,  coupled  with  enhanced
cooperation  on  issues  like  terrorism,  the  environment,  drugs,  and  demographic
change.  In  Latin  America,  fighting  social  inequality  and  building  more  cohesive
societies are overriding priorities, combined with support for regional integration to
increase  the  competitiveness  of  Latin  American  enterprises.  Asia  is  home  to  two-
thirds  of  the  world’s  poor.  Food  security,  health  and  access  to  basic  services  are
pressing issues  in  the  region’s  lower-income  countries,  whilst  serious  disparities  of
income and opportunity still challenge many middle-income countries. A key focus
for EC programmes in Central Asia is institutional, legal and administrative reform
and  private  sector  and  economic  development  to  tackle  problems  ranging  from
widening income disparities and poverty to slow economic and democratic transition
including  Human  Rights  issues.  African,  Caribbean,Pacific  countries  and  Overseas
countries and territories, which come together into effect on 1 April 2003, under the
framework of the Cotonou Agreement, face many common problems but also differ
in some important respects. The Pacific and Caribbean regions contain many small-
island  states,  whilst  in  Africa  several  conflicts  are  exacerbated  by  the  size  and
fragility  of  countries.  40  of  the  77  ACP  countries  are  Least  Developed  Countries,
marked by a particularly low per capita income and severe infrastructure problems.

The different aspects of the Community’s external relations with different regions are
framed in a  series of  cooperation and partnership agreements.  Chapter 6 reports  on
key developments in each of these regions during 2002.

1.1.3

Complementarity between Development and other External Objectives

In  many  cases,  the  Community’s  development  and  other  external  objectives  are
complementary,  as  are  interventions  in  different  areas.  The  link  between  conflict
prevention and the promotion of Human Rights and democracy is clear, for example,
as  is  the  link  from  these  areas  to  poverty  reduction.  In  the  aftermath  of  violence,
concrete Community assistance has helped rebuild society and prevent the recurrence
of  disputes.  Instead  of  addressing  merely  the  symptoms  of  conflict,  methods  must
also  be  developed  to  identify  and  tackle  their  root  causes,  which  many  times  are
assessed  to  be  extreme  poverty.  The  relationship  between  investments  in  terms  of
basic health services and those related to Research and Development (R&D) for new
drugs  and  treatments,  especially  in  the  context  of  the  fight  against  the  major
communicable diseases linked to poverty, needs also to be underlined.

Given the many external policies and instruments in play and the need to respond to
different  circumstances,  the  Community’s  Country  and  Regional  Strategy  Papers

14

constitute  an  important  tool  for  analysing  and  suggesting  the  right  policy  mix.
Interventions  undertaken  through  the  Community’s  horizontal  and  thematic  budget
lines,  which  cover  development  as  well  as  broader  external  objectives  such  as
cooperation on drugs,  are increasingly  being  integrated  within  this  framework.  The
Community  is  also  working  to  ensure  improved  coherence  at  the  central  policy
level.Complementarity  between  development  and  research  policy  is  based  on  the
notion  of  the  need  for  synergies  between  S&T  capacity  building  and  inter-regional
research collaboration (North-South, East-West).

1.2

Adapting to Changes in the EU and Global Context during 2002

1.2.1

EU Enlargement and New Political Priorities

In  terms  of  internal  EU  developments,  the  groundbreaking  decision  taken  in
December 2002 to enlarge the EU in May 2004 from 15 to 25 Members will have a
profound impact on the region’s future role, including its external and development
role. These countries, which have received substantial EU and external support over
the  past  12  years  for  their  own  political  and  economic  transition,  will  become
members of the EU’s external policies from the date of their accession. During 2002,
the  accession countries,  the Commission  and  Member States and the EU’s external
partners have begun to focus on preparations for this. Although development issues
have  not  been  a  high  profile  issue  in  the  context  of  enlargement,  the  Commission
launched  a  programme  of  work  in  2002  with  accession  countries  and  current
Member  States.  This  is  focused  on  3  aspects:  possible  implications  for  the
Community’s policy and programme processes (such as decision-making processes,
priorities, channels of implementation and financial issues); how to help the acceding
countries  in  their  preparations  for  taking  on  the  Community’s  development  policy
and their role as emerging donors (re-emerging in some cases); and implications for
the  Community’s  development  partners.  Several  studies  and  fact-finding  exercises,
as  well  as  a  first  set  of  capacity  building  and  awareness-raising  activities  were
launched in 2002 to help define and inform future activities in this area, including a
road-map. This work will continue and expand in 2003-2004.

Internal  policies  and  activities  in  other  areas  have  also  affected  the  context  for  the
Community’s development cooperation policy  and  external  assistance,  in  particular
the  heightened  interest  in  how  to  integrate  migration  issues  into  the  EU’s  relations
with its external partners including developing countries.

1.2.2

The Global Context: Political and Economic Instability

Continued  political  and  economic  stability  in  2002  has  had  a  major  impact  on  the
Community’s  external  relations  including  its  development  policy  and  its  external
assistance.

Events  in  different  parts  of  the  world  starkly  highlighted  the  interdependence
between  both  developed  and  developing  countries.  From  the  economic  crisis  in
Argentina and the slowdown in developed country markets, to the tragedy of the Bali
bomb and the ongoing fight against terrorism, to the devastation of new and ongoing
conflicts. In 2002, there were positive steps towards peace in countries including Sri
Lanka,  Angola,  and  the  Democratic  Republic  of  the  Congo.  The  Community
launched a programme of long-term assistance to Afghanistan, marking an important

15

transition in its partnership. Unfortunately, the situation in other places deteriorated,
including the Middle East, Côte d’Ivoire and Zimbabwe.

These events highlight the  vital importance  of  continued attention  to  economic  and
governance  issues  and,  specifically,  to  conflict  prevention  and  resolution.  The
Community  is  already  very  active  in  this  area,  including  through  its  development
policy  and  external  assistance  programmes,  and  recognises  the  need  to  take  a
comprehensive  and  long-term  approach.  The  Community,  along  with  EU  Member
States, has also taken an important role in the international fight against terrorism.

Greater recognition of the links between developed and developing countries during
2002 has, in turn, underlined the importance  of  adequate and sustained  attention to
development issues for the successful achievement of other objectives. Poverty  and
exclusion,  regional conflicts, environmental  degradation  and  AIDS  are  all  potential
threats  to  security.  The  Community’s  development  cooperation  and  external
assistance  policies  and  programmes,  as  well  as  EU  policies  and  activities  in  other
areas, have a vital role to play in this process and a number of new initiatives have
been  taken  during  the  year.  Sweden  and  France  played  a  key  role  in  2002  in  the
launch  of  a  new  international  Task  Force  on  global  public  goods,  which  will  be
examining  over  the  next  2  years  how  to  ensure  that  major  issues  of  international
concern  such  as  controlling  communicable  diseases  and  combating  climate  change
are clearly defined, analysed, and the needs adequately met.

1.2.3

A  New  Global  Partnership  for  Growth,  Poverty  Eradication  and  Sustainable
Development

The international Financing for Development Conference in Monterrey, Mexico and
the  World  Summit  on  Sustainable  Development  in  Johannesburg,  South  Africa  (in
March  and  September  2002  respectively)  confirmed  the  direction  taken  with  the
launch  of  the  Doha  Development  Agenda4,  in  terms  of  a  new  global  partnership
between developed and developing countries. At the centre of this is the recognition
that success requires action by all countries. The EU worked hard for the success of
Doha,  Monterrey  and  Johannesburg,  and  will  do  the  same  for  the  forthcoming  UN
World  Summit  on  the  Information  Society.  The  EU  enlargement  and  the  further
increase in EU aid between now and 2006 by all Member States will allow the region
to play an even greater role going forward than it does already.

Monterrey  and  Johannesburg  confirmed  the  central  importance  of  the  Millennium
Development Goals as the guiding framework for action between now and 2015. The
EU strongly supported  the addition of new  target to halve  the  proportion of  people
without  access  to  sanitation  by  2015,  to  go  with  the  existing  target  on  access  to
water. The international community now has a clear and comprehensive framework
for action to achieve growth, poverty eradication and sustainable development. The
focus must now turn even more strongly to implementation.

4

The  ‘Doha  Development  Agenda’  refers  to  the  agreement  reached  regarding  the  agenda  for  the
multilateral trade negotiations launched at the World Trade Organisation Ministerial in Doha, Qatar, in
November 2001.

16

                                                
1.2.4.

The EU’s WSSD Initiatives: Water and Energy

At  the  World  Summit  on  Sustainable  Development  (WSSD),  the  EU  launched  two
major  initiatives  on  water  and  energy,  designed  to  accelerate  progress  on
implementation towards the MDGs.

The EU’s Water for Life Initiative is profiled in the special feature on water in this
report (see Chapter 7).

The  EU  Energy  Initiative  for  Poverty  Eradication  and  Sustainable  Development
highlights  the  political  will  of  EU  Member  States  and  the  Commission  to  enhance
activities in this field. Although there is no specific MDG on energy, the provision of
adequate  affordable  and  sustainable  energy  services  in  rural,  peri-urban  and  urban
areas is essential for the achievement of the MDGs. A reliable and affordable energy
supply is however far from the norm in the developing world, where over 2 billion
people  rely  on  biomass  (wood,  waste  etc)  as  their  primary  energy  source,  and  1.6
billion people still do not have access to electricity. The EU’s energy initiative seeks
to contribute to poverty eradication by helping to improve access to energy services,
working  through  a  menu  of  technical  options,  including  rural  electrification  and
decentralised energy systems, cleaner more efficient fossil fuel technologies and use
of locally available renewable energy, especially the improved management and use
of biomass. Activities will ensure ownership of beneficiaries, and will be developed
through partnerships with developing countries and regions, as well as stakeholders
from private sector, financing organisations and civil society. Dialogue with partners
and  stakeholders  will  be  enhanced  at  national  and  regional  level  to  implement
partnerships  on  a  demand-led  basis.  Important  aspects  of  the  initiative  will  include
the provision of support for institutional capacity building and technical assistance to
countries to put in place adequate energy policies. An important role will be given to
the development of new research based strategies. The Commission also published a
new  Communication  setting  out  its  strategic  approach  to  energy  cooperation  with
developing countries in July 2002.5

1.3

Key Achievements during 2002

1.3.1

Continuing improvements in Efficiency and Effectiveness

For  the  EU,  the  global  framework  that  has  emerged  from  Doha,  Monterrey  and
Johannesburg  reinforces  the  direction  in  which  the  Community  has  been  moving
internally since 2000, in terms of both its operational and policy framework.

The continuing progress being made towards efficiency and effectiveness, as part of
the management reform programme launched in 2000, is detailed in Chapter 2 of this
report.  The  Commision  also  simplified  and  decentralised  the  EDF  financial
procedures for the OCTs6, as requested by the Council in its 2001 overseas decision.

Progress towards development and other external assistance objectives is outlined in
Chapter  3,  including  the  results  of  a  cross-regional  and  cross-country  analysis  of
progress towards the Millennium Development Goals undertaken by the Commission
and  progress  in  the  6  priority  areas  for  EC  assistance  defined  in  2000.  A  major

5

6

COM(2002)408
Commission Regulation N°2304/2002, 20.12.2002, OJ L 348, 21.12.2002, p.82

17

                                                
challenge for the Community going forward will be to respond to the emergence of
new EU and international priorities without undermining selectivity and focus.

Completion of the Programming Process

A  major  strategic  achievement  during  2002  was  the  completion  of  the  first
generation  of  regional  and  country  strategy  papers  (RSP  –  CSP)  under  the  new
common  framework  process  begun  just  two  years  earlier.  A  qualitative  leap  in  the
Community’s  programming  of  external  assistance  has  been  achieved  and  the
programming  documents  will  serve  as  valuable  management  tools  for  the  years
ahead.  The  CSP  Framework  has,  as  intended,  proved  to  be  a  very  useful  tool,
including  for  operationalising  the  objective  of  giving  multi-annual  programming
greater  substance  and  improving  co-ordination  and  complementarity  with  bilateral
aid  provided  by  EU  Member  States.  The  CSP  Framework  has  also  made  an
important  contribution  to  harmonising  programming  methodology  across  regions.
For the years ahead, it is important to set up a comprehensive mechanism to monitor
and review implementation of CSPs and RSPs, so as to maintain the momentum in
the CSP process. The process of preparing for Mid Term Reviews, including further
work  on  methodologies,  will  begin  in  2003.  The  Commission  will  strive
continuously  to  improve  the  quality  in  its  programming  documents  and  to  firmly
integrate the CSP process into the international development effort.

Embedding of the PRSP Approach for Low-Income Countries

In  terms  of  poverty  reduction  in  low-income  countries,  January  2002  saw  the  first
international review of the results-oriented partnership approach based on nationally
owned  strategies  for  poverty  reduction  (often  known  as  the  Poverty  Reduction
Strategy Paper, or PRSP, approach). The Commission, like  many  other donors,  has
committed to use PRSPs, where they exist, as the starting point in designing its own
response strategies (CSPs). By November 2002, 45 countries had prepared an interim
Poverty  Reduction  Strategy  Paper  and  19  had  a  final  PRSP.  The  Commission  has
particularly emphasised the importance of implementation tied to a national strategic
resource  allocation  cycle  and  the  key  role  of  national  democratic  accountability,
particularly  through  national  Parliaments,  drawing  on  agreed  indicators  of  results.
The  Commission  has  been  working  particularly  closely  with  the  Bretton  Woods
Institutions  on  this,  following  joint  consultations  in  May  2002.  A  working  group
between  the  World  Bank  and  IMF,  the  European  Commission  on  behalf  of  the
Community  and  the  UK’s  Department  for  International  Development  (DFID)  has
started to conceptualise the idea of ‘the PRSP cycle’. The Commission’s efforts were
recognised  at  the  January  2002  Conference  and  its  approach  has  been  increasingly
widely accepted by others during the year. It promises to form the basis for an even
broader consensus as work on the concept deepens during 2003.

1.4

The Three Cs: Coherence, Coordination and Complementarity

Ensuring  coherence  between the  objectives of the EC’s development  policy  and  its
policies and goals in other areas is an operational priority as well as a legal obligation
for the Commission.

Improved coordination and complementarity are essential elements in the process of
making  the  EC’s  external  assistance  more  effective.  At  the  most  basic  level,
coordination entails greater awareness of what others involved in a particular sector

18

or  country  or  region  are  doing,  combined  with  efforts  to  work  together  more
effectively.  Coordination  is  critical  in  order  to  avoid  overlap  or  inconsistencies
between  those  seeking  to  achieve  common  goals.  Complementarity  begins  with
coordination, but it goes further : it implies each actor focusing its assistance where it
can add most value, given what others are doing, maximising synergies.

1.4.1

Improving Coherence

The Community has  a legal  obligation contained in the Treaty to ensure  coherence
by  taking  an  integrated  approach  to  external  relations,  security,  economic  and
development  policies7.  This  includes  the  need  to  take  account  of  development
objectives in all activities likely to affect developing countries8.

This  notion  was  reaffirmed  in  2002  in  the  Commission’s  Communication  on  the
external dimension of the EU’s sustainable development strategy9, and in the Council
Conclusions  on  this  Communication  and  on  the  EU’s  preparations  for  the  World
Summit on Sustainable Development10.

1.4.1.1 New Impact Assessment Processes

As part of its efforts to improve coherence, the Commission is increasingly making
use  of  impact  assessment  processes.  During  2002,  sustainability  impact  assessment
processes were launched that will be run in parallel with and inform the WTO trade
negotiations, as well as the negotiations between the EU and ACP countries on new
Economic  and  Partnership  Agreements.  In  May  2002,  as  part  of  the  package  of
measures  to  improve  governance,  the  Commission  outlined  proposals  for  a  new
impact assessment for all major policy proposals11. This will be introduced gradually
from  January  2003.  It  is  intended  to  identify  in  advance  potential  economic,  social
and  environmental  impacts  within  and  outside  the  EU,  and  as  such  may  become  a
major  tool  for  verifying  coherence.  Such  Extended  Impact  Assessments  will  be
carried  out  as  of  2003  for  key  policy  reforms.  Of  particular  importance  for
developing countries is the reform of the Common Market Organisation for sugar.

1.4.1.2 Adapting EU Policies to Sustainable Development Objectives

The  EU  has  also  committed  to  continue  the  process  of  adapting  key  EU  domestic
policies  to  the  internal  and  external  objectives  of  sustainable  development.  During
2002,  the  Commission  published  proposals  for  alterations  to  two  policies  that  are
acknowledged to play a critical role in coherence: the Common Agricultural Policy
(CAP) and the Common Fisheries Policy (CFP).

In the context of the Mid Term Review of the CAP and in line with the orientations
already established as part of ‘Agenda 2000’, the Commission proposed a substantial
reorientation of the Common Agricultural Policy to promote greater compliance with
income redistribution and sustainability objectives. These proposals  were set out  in

7

8

9

10

11

TEU Article 3
TEC Title XX Art 178
‘Towards a Global Partnership for Sustainable Development’ COM(2002)82 Final of February 2002
Development Council Conclusions, May 30 2002, 9458/02
COM(2002)276 of May 2002

19

                                                
the Commission Communication, ‘Towards Sustainable Farming.12 Not all products
were  covered  by  the  MTR  (notable  exceptions  included  rice,  sugar  and  cotton).
Nevertheless, the proposals put forward in 2002 for greater de-coupling of subsidies
from  production  and  reduction  on  guaranteed  prices  are  positive  signs  of  efforts  to
increase market orientation of the CAP. This, in turn, is likely to reduce its negative
impact on third countries and enhance coherence with the Community’s development
policy.  It  is  expected  that  the  MTR,  when  applied,  will  lead  to  less  intensive  and
more diversified production patterns. Farmers will no longer be remunerated on the
basis of quantities produced, and will receive instead an all inclusive income subsidy
based  on  compliance  with  environmental  principles  of  sound  agricultural
management.

The need for coherence between the Community’s fisheries policy and development
objectives  for  ACP  states  has  been  reinforced  in  the  Cotonou  Agreement,  which
states  that,  “Any  fishery  agreement  negotiated  between  the  Community  and  ACP
States shall pay due consideration to consistency with the development strategies in
this area.”13 In a Resolution on Fisheries and Poverty Reduction of November 2001,
include
the  Council  further  underlined 
environmental  and  developmental  considerations.14  Consistent  with 
these
requirements,  the  Commission’s  2002  Communication  on  reform  of  the  CFP15  and
the  subsequent  Communication  on 
the  Community’s  Fisheries  Partnership
Agreements  (FPAs)  with  third  countries16  recognised  the  need  to  ensure  coherence
with  development objectives, as  well  as  other  objectives  including  sustainability  of
fish stocks at the global level (addressed in the Plan of Implementation of the World
Summit on Sustainable Development).

that  Fisheries  Agreements  should 

The Community has bilateral agreements with 15 developing (mainly ACP) coastal
states  that  involve  financial  contributions  from  the  Community  to  the  authorities
concerned. The Communication noted that these agreements generate in Europe and
the  coastal  states  important  economic  activities,  both  through  the  exploitation  of
fishing  resources  and  through  the  development  of  associated  activities.  The
Communication proposed a number of new initiatives to enhance the positive impact
of the new Fisheries Partnership Agreements (FPAs) on developing countries’ local
economies  going  forward.  These  include  sustainability  impact  assessments  for  new
FPAs  and  a  more  concerted  effort  between  the  Common  Fisheries  Policy  and  the
Community’s development cooperation policy in order to strengthen the capacity of
the local authorities to formulate and implement fisheries policy, including stronger
ownership. Also that the financial contribution of the new FPA should make a clear
distinction  between:  the  part  of  the  financial  contribution  given  in  exchange  of
fishing  possibilities  for  European  vessels;  and  the  other  part  of  the  contribution
devoted to fisheries partnership actions such as stock assessment, control monitoring
and  surveillance  activities.  All  these  activities  should  be  seen  more  in  terms  of  the
mutual  interest  of  both  sides  in  establishing  responsible  fishing  on  a  sustainable
basis.

12

13

14

15

16

COM(2002)394 Final of July 2002
Article 23 Title I
Council Conclusions of 8 November 2001, Reference 13573/01
COM(2002)181 Final of 28 May 2002
COM(2002)637 Final of 23 December 2002

20

                                                
The implementation of the Commission’s proposals in both cases will depend on the
outcome of discussions with EU Member States. The way that the new approach to
fisheries has begun to be implemented in the ACP region during 2002, in particular
in the context of the new FPA with Kiribati and the Pacific Regional Strategy Paper,
is outlined in the ACP regional chapter later in this report.

1.4.1.3 Migration and Development

The  Commission’s  Communication  on  Migration  and  Development17  brought
together the different dimensions of this issue. As part of this, it set out the broader
context,  including  the  need  to  take  account  of  the  driving  forces  of  international
migration,  the  specific  case  of  people  in  need  of  protection  and  the  effects  of
international  migration  on  developing  countries.  In  integrating  migration  into  the
external policy of the Community, the Commission  proposed  to base further  action
on the following key principles:

– 

– 

The integration of migration aspects in the  external  action  of  the  Community
must  respect  the  overall  coherence  of  its  external  policies  and  actions.  The
dialogue and actions with third countries in the field of migration must be part
of  a  comprehensive  approach  at  EU  level,  which  must  be  fundamentally
incitative  by  encouraging  those  countries  that  accept  new  disciplines  but  not
penalising  those  who  are  not  willing  or  not  capable  to  do  so.  The  approach
must  also  be  differentiated,  taking  due  account  of  the  situation  of  each
individual third country.

Regarding  migration,  the  long-term  priority  of  the  Community  should  be  to
address  the  root  causes  of  migration  flows.  One  should  duly  recognise  the
effect of long-term development programmes on migratory flows, in particular
in  poverty  eradication,  institution  and  capacity  building,  conflict  prevention.
Development resources should concentrate on this objective. Besides, as part 2
of the Communication demonstrates, the Commission already supports a wide
range of specific actions in the field of migration, with a total value of € 935
million planned for the period 2002 –2006.

–  Migration aspects should, in the first instance, be taken care of in the strategic
framework  proposed  by  the  Commission  and  agreed  by  the  Member  States
(Regional and  Country  Strategy  Papers).  The  CSP  mid-term  review  offers  an
opportunity to examine the extent to which greater priority should be given to
specific  programmes  related  to  migration.  This  should  permit  a  case-by-case
reassessment  of  migration  in  third  countries  and  could  lead  to  some
reorientation  in  our  priorities  and  some  reallocation  of  funds  within  the
National Indicative Programme of each country concerned.

–  Without prejudging  the  results  of the  CSP review,  it  already  seems  clear  that
extra  funding  will  be  needed.  New  tasks  are  feasible  only  if  new  money  is
made  available.  The  relevant  budget  line  (B7-667:  Cooperation  with  third
countries  in  the  field  of  migration)  should  be  significantly  reinforced  and
should come as a complement  to  what can be achieved in the CSP  review.  It
should  be  used  to  finance  specific,  targeted  actions  in  the  field  of  migration.

17

COM(2002)703

21

                                                
These  should  be  complementary  to  those  financed  under  the  more  generic
assistance  lines.  This  approach  should  ensure  a  greater  impact  and  higher
profile for migration initiatives, and help avoid duplication and confusion. The
relevant budget line must also be managed in accordance with the principles of
the RELEX Reform, so as to allow consistency and economies of scale.

1.4.1.4 Untying Aid: Enhancing the Effectiveness of Aid

The practice of ‘tying aid’ (whereby developing countries receiving aid are restricted
to purchasing goods and services with that aid from the donor giving it to them) is an
important  element  of  the  debate  on  aid  effectiveness  and  donor  credibility.  The
Commission believes that untying aid is  an important factor  in  a  coherent pro-poor
development  policy.  Untying  aid  can  have  a  substantial  practical  impact,  by
significantly  increasing  the  value  of  development  assistance.  This  is  because
development  partners  are  free  to  choose  the  most  appropriate  and  cost-effective
supplies  for  their  needs.  Tied  aid  is  estimated  to  cost  on  average  between  20-25%
more  than  if  the  goods  or  services  in  question  were  procured  through  international
competition.18

In  2001,  the  Development  Assistance  Committee  of  the  OECD  formally  adopted  a
Recommendation  to  untie  aid  to  the  Least  Developed  Countries.  In  the  context  of
preparations  for  the  Financing  for  Development  conference  in  March  2002,  the
European  Council  agreed  to  continue  discussions  in  view  of  further  untying.19
Following  on  from  these  two  steps,  the  Commission  adopted  a  Communication  on
untying  in  November  2002.20  This  proposed  an  almost  complete  untying  of
Community aid (subject to the agreement of the recipient country and on a reciprocal
basis  between  all  donors).  Moreover,  the  Communication  recalled  that  the  rules  of
the internal market apply also to a large part of Member States’ ODA, and advised
them  to  respect  those  rules  with  regard  to  their  bilateral  aid  programmes.  This
Communication also advocated a complete untying of food aid and food aid transport
at the international level. Discussions on this issue will continue in 2003.

1.4.2

Strengthening Co-ordination and Complementarity

Promoting  co-ordination  and  complementarity  between  Member  States  and  the
Community in the broader international framework is critical for the effectiveness of
the  Community’s  development  cooperation  policy  and  programmes.  Despite  the
clear  potential  benefits,  and  notwithstanding  some  encouraging  improvements,
implementation of EU coordination remains difficult.

A  number  of  positive  steps  forward  were  taken  in  2002,  both  within  the  EU  and
beyond.

18

19

20

Source: DAC. Also World Bank research.
European  Council  Conclusions  of  14  March  2002  on  the  International  Conference  on  Financing  for
Development
COM(2002)639, Communication from the Commission to the Council and to the European Parliament,
Untying: Enhancing the effectiveness of aid, 18 November 2002

22

                                                
1.4.2.1 A Coordinated EU Input to the Monterrey and Johannesburg Conferences

At  the  policy  level,  the  EU’s  preparations  for  the  Conference  on  Financing  for
Development  in  Monterrey,  Mexico  and  the  World  Summit  on  Sustainable
Development in Johannesburg both proved to be useful opportunities for improving
co-ordination. Similar efforts are being made in the context of the forthcoming UN
World Summit on the Information Society. The mandate given to the Commission by
EU Member States to present a report in preparation for the  Monterrey Conference
was  a  positive  sign  of  the  confidence  that  had  been  built  up.  This  report,  and  the
action  taken  by  Member  States,  helped  to  ensure  a  positive  EU  contribution  to  the
conference.  It  clarified  a  number  of  issues  and  explored,  through  a  dialogue  with
Member States, possible initiatives to address key issues. This included how to close
the  financial  gap  between  the  current  level  of  ODA  and  the  volume  necessary  to
meet the Millennium Declaration Goals (which the World Bank had estimated would
require  a  doubling  of  current  ODA  levels21).  This  was  instrumental  in  the  EU
decision to increase EU ODA levels between now and 2006. Other initiatives related
to  the  effectiveness  of  aid  (including  aid  untying,  discussed  above),  concrete  steps
forward  on  coordination  and  harmonisation,  reform  of  the  International  Financial
System,  trade  and  development,  debt  sustainability,  global  public  goods  and
innovative  sources  of  financing.22  Following  the  request  of  the  November  2002
General  Affairs  and  External  Relations  Council,  the  Commission  will  monitor  the
implementation  of  these  commitments.  The  EU’s  two  major  initiatives  launched  at
the  Johannesburg  conference  in  water  and  energy  emphasise  operational  co-
ordination  and  complementarity, both at  the  policy level and  at  the implementation
stage.  This  will  be  achieved  through  the  development  of  partnerships  with
developing countries, other donors, the private sector and civil society. They provide
a  catalyst  for  future  action  to  reach  the  WSSD  (World  Summit  for  Sustainable
Development) goals related to water and energy.

1.4.2.2 Commitment to Concrete Steps on Coordination and Harmonisation by 2004

One  of  the  EU’s  commitments  prior  to  the  Financing  for  Development  Conference
was  to  take  concrete  steps  in  the  co-ordination  of  policies  and  harmonisation  of
procedures  before  2004.  EU  action  in  this  area  will  also  take  account  of  similar
efforts  being  made  at  the  international  level  by  the  World  Bank  and  other
Multilateral  Development  Banks  as  well  as  by  OECD/DAC  Task  Force  on  Donor
Practices.23  As  one  step  towards  this  commitment  and  at  the  request  of  Member
States,  the  Commission  launched  a  pilot  initiative  focused  on  four  countries,  to
examine current coordination and complementarity initiatives as well as the scope for
further action. The results of a scoping mission in late 2002 should enable the EU to
consider  and  possibly  agree  during  2003  on  practical  measures  to  strengthen  the
operational co-ordination between what is done by the Commission on behalf of the
Community and what is done bilaterally by Member States. They also informed the
EU’s  input  to  the  international  High  Level  Forum  on  Harmonisation  in  Rome  in

21

22

23

http://www.worldbank.org/html/extdr/mdgassessment.pdf
COM(2002)87:  Preparation  of  the  International  Conference  on  Financing  for  Development.  Related
proposals  were  developed  in  COM(2002)82.  ‘Towards  a  Global  Partnership  for  Sustainable
Development’ and COM(2002)81, ‘Responses to the Challenges of Globalisation’
European  Council  Conclusions  of  14  March  2002  on  the  International  Conference  on  Financing  for
Development

23

                                                
February 2003, with the Multilateral Development Banks and the OECD/DAC as co-
sponsors.

The EU Pilot Initiative on Co-ordination and Harmonisation

"Reach concrete steps in co-ordination of policies and harmonisation of procedures before 2004"

In  June  2002,  the  Commission  launched  with  the  Member  States  a  pilot  initiative  to  identify
pragmatic measures to help to achieve progress in operational co-ordination and harmonisation
at  EU  level.  Four  pilot  missions  were  conducted  in  Morocco,  Mozambique,  Nicaragua,  and
Vietnam.

The exercise highlighted the increasing demand for more co-ordination and harmonisation from
most  of  the  actors  present  on  the  ground  in  these  countries,  who  stressed  that  flexibility  and
pragmatism  were  critical.  It  also  raised  expectations  of  an  enhanced  EU  contribution.  In  the
first half of 2003 and as requested by the Barcelona EU Council in March 2002, the European
Union will define a plan of action to achieve real concrete progress in this area before 2004.

1.4.2.3 Monitoring the Synergies of EU policies and Promoting Dialogue

During 2002, the Commission hosted regular informal meetings between Directors-
General  for  Development  from  all  EU  Member  States.  These  provided  a  useful
forum  for  the  exchange  of  views  and  experiences  on  best  practices  and  common
concerns regarding the effective implementation of existing commitments, especially
in the field of co-ordination of policy and harmonisation of procedures as well as the
effectiveness  of  aid.  They  also  helped  to  facilitate  the  coordinated  EU  input  to  the
Monterrey and Johannesburg conferences, noted above. This forum is likely to play a
key role in ensuring the smooth and effective integration of the EU’s new  Member
States, following enlargement, within the Community’s development policy.

1.4.2.4 Tackling Coherence, Coordination and Complementarity at the Programming Stage

The  Country  Strategy  Papers  (CSP),  backed  up  by  the  work  of  the  inter-service
Quality  Support  Group  and  the  establishment  of  country  teams,  have  become  the
central  mechanism  for  strengthening  policy  coherence  with  other  Community
policies  at  country  level  and  for  enhanced  co-ordination  and  complementarity  with
Member  States.  In  finalising  CSPs  and  RSPs,  the  Commission  made  extensive
efforts to co-ordinate the CSP process with other actors. A survey carried out by the
Commission  revealed  that  EC  Delegations  in  partner  countries  had  played  a  very
active  role  in  the  co-ordination  process  in  the  field.  Of  the  donors  present  in  the
country, all EU Member States were systematically invited to participate in the  co-
ordination/complementarity  exercise  and  in  55  %  of  the  cases  all  non-EU  donors
present were invited as well. This process involved the organisation of consultative
fora together with the partner countries and extensive dialogue with Member States.
Non-State  Actors  (NSAs)  were,  for  the  first  time,  directly  involved  in  the
programming of Community aid.

Another  positive  initiative  during  2002,  from  the  Council,  was  the  decision  to
establish  common  country  fact  files.  These  could  form  the  basis  for  more
comprehensive common analysis and joint programming at field level. The purpose
is  to  share  information,  to  facilitate  co-ordination  and  enhance  complementarity
between  Member  States  and  the  Community,  and  between  Member  States
themselves.  The  intention  is  to  have  a  document  that  is  short,  inclusive  but  with
specific information. The fact file will try to list all EU policies affecting the EU and

24

the  country  concerned,  although  emphasis  with  many  countries  will  be  on
development co-operation.

1.5

Working with Others

As  well  as  improving  coordination  and  complementarity  within  the  EU,  the
Commission  also  recognises  the  importance  of  similar  efforts  with  respect  to  other
donors and international organisations.

The  OECD  Development  Assistance  Committee  recognised  that  the  European
Commission  can  add  value  to  this  effort  in  its  2002  Peer  Review  of  the  European
Community.24 The re-enforcement of delegations in developing countries as part of
the de-concentration process should enhance the Community’s  capacity  in  this area
further.

In 2002, development issues were put high on the agenda of the joint EU-Australia,
EU-Canada, EU-Japan and EU-USA Summits. This created a better momentum for
dialogue, in particular on issues linked to the UN Conferences, the New Partnership
for  African  Development  (NEPAD),  Afghanistan  and  about 
level  and
effectiveness of ODA. Specific initiatives launched in 2001 with Norway and Japan,
building on previous dialogue, staff exchanges and common assessments, are leading
to the definition of operational guidelines.

the 

1.5.1

Harmonising Donor Practices

During  2002,  the  Commission  has  continued  to  actively  support  international
initiatives  aimed  at  harmonising  donor  practices,  which  are  taking  place  in  several
different fora.

In  particular,  the  Commission  has  welcomed  the  work  of  the  OECD/DAC  Task
Force on Donor Practices. This Task Force, set up in 2000 to identify and document
donor practices to reduce the burden on the capacities of partner countries to manage
aid and lower the transaction costs involved, completed its work on schedule at the
end of 2002. The six Good Practice Reference Papers produced  by this  Task  Force
set  effective  benchmarks  for  improved  harmonisation,  and  cover  all  phases  of  the
project cycle.25 They were a major input to the High Level Forum on Harmonisation
in February 2003 in Rome, which brought together the work of the DAC Task Force
and ongoing work by the Multilateral Development Banks.

The Commission has also participated in harmonisation initiatives in the G8 context,
including  the  work  of  the  G8  Education  Task  Force.  This  has  sought  to  promote
harmonisation of procedures through the definition of a Code of Conduct. This Code
of Conduct was drawn up by a Group of Experts from EU Member States set up by
the Commission, and its implementation was recommended by the Council.

The  Commission  has  also  been  involved  in  discussions  on  harmonisation  of
procedures surrounding Country Strategy papers, through bilateral contacts with the

24

25

The Peer Review is available from www.oecd.org/DAC
The  6  papers  are:  Framework  for  Donor  Co-operation;  Country  Analytical  Work  and  Preparation  of
Projects  and  Programmes;  Measuring  Performance  in  Public  Financial  Management;  Reporting  and
Monitoring; Financial Reporting and Auditing; and Delegated Cooperation. See: www.oecd.org/DAC

25

                                                
UNDP,  the  World  Bank  and  certain  EU  Member  States.  Initiatives  include  the
streamlining of strategy documents and procedures (such as analysis of the economic
and social situation, donor matrix, indicators), mutual consultation of all key donors
in each institution’s strategy process, active co-operation in the areas covered by the
building  blocks  common  to  all  CSPs  and  synchronising  the  timing  of  country
programming and strategy preparation and review processes.

1.5.2

Enhancing the Partnership with the United Nations

1.5.2.1 Building Strategic Partnerships

Extensive  upstream  policy  dialogues  at  various  levels  took  place  in  2002  with  the
UN  Agencies,  Funds  and  Programmes.  Building  on  the  momentum  of  the
Communication on “Building an Effective Partnership with the United Nations in the
Fields  of  Development  and  Humanitarian  Affairs"  adopted 
the
Commission  has  increased  its  involvement  with  the  UN  family  through  the
establishment  of  strategic  partnerships  with  selected  UN  Agencies,  Funds  and
Programmes.  Ongoing  work  towards  selection  of  strategic  partners  should  be
finalised  in  2003  and  partnership  agreements  will  be  established  with  the  selected
UN  bodies.  This  should  allow  the  Commission  to  work  with  the  UN  in  a  more
efficient  and  coherent  way  in  the  priority  areas  of  the  Community’s  development
policy.

in  200126, 

1.5.2.2 Improving the working framework

Revision of the 1999 EC-United Nations Framework Agreement for EC funding of
UN  projects  was  completed  during  2002.  The  agreed  text  will  be  submitted  for
approval  by  both  negotiating  parties  and  is  expected  to  enter  into  force  in  the  first
quarter of 2003. The revised agreement reflects the new Financial Regulation of the
Commission  and  offers  a  more  flexible  instrument  for  co-operation  with  the  UN
system.  In  particular,  it  allows  funding  of  multi-donor  programmes  of  the  UN,  in
accordance  with  the  notion  of  joint  management  enshrined  in  the  Financial
Regulation.  This  is  also  one  important  prerequisite  for  setting  up  strategic
partnerships.

1.5.3

Scaling Up Collaboration with the International Financial Institutions

Collaboration  between  the  European  Community  and  the  World  Bank  and  the
International Monetary Fund has become increasingly important for several reasons.
Firstly, the Commission is working  closely  with these  bodies in  taking forward the
PRSP approach, as outlined above. Secondly, in the context of the Doha-Monterrey-
Johannesburg Conferences, the Bretton Woods Institutions, together with the UN and
the  EU,  have  been  a  major  force  for  multilateralism.  Thirdly,  the  European
Community remains the largest contributor to trust funds administered by the World
Bank, including the Heavily  Indebted Poor Countries (HIPC) debt relief trust fund.
Financing Proposals for contributions to the Global Health Fund and the Afghanistan
Reconstruction Fund were prepared in 2002.

26

COM(2001)231

26

                                                
1.5.3.1 Adopting a new Framework Agreement with the World Bank Group

The  negotiations  to  revise  the  EC-World  Bank  Group  Framework  Agreement  of
2001  were  completed  in  2002.  In  parallel  to  the  negotiations,  a  first  set  of  annual
consultations  on  issues  of  common  interest  under  the  agreement  were  organised
(mainly implementation of World Bank Group trust funds financed by the European
Community). There was broad participation on both sides, which allowed for a better
communication  of  Community  interests  and  objectives  to  the  World  Bank  Group,
and  a  better  overview  of  its  plans  and  priorities  for  the  near  future.  Similar  annual
consultations will begin with the UN in 2003.

1.5.3.2 Cooperation on Difficult Partnerships and Financial Management

In  October  2002,  the  Commission  co-organised  a  workshop  with  the  World  Bank,
the  OECD/DAC  and  UNDP  on  "difficult  partnerships"  in  Paris,  with  the  aim  to
improve and harmonise donor responses in situations where the partnership paradigm
does not work. For example, countries where the policy environment is poor.

Co-operation on support to public finance gained momentum under the joint Public
Expenditure  and  Financial  Accountability  (PEFA)  programme,  which  is  currently
supported  by  the  World  Bank,  DFID  and  the  Community  (also  through  a  Trust
Fund).

1.5.3.3 Strategic Partnership with Africa

The Commission has a long-standing involvement in the Strategic Partnership with
Africa  (SPA),  the  informal  forum  set  up  in  1988  that  brings  together  bilateral  and
multilateral  donors  to  support  Africa-led  efforts  to  reduce  poverty.  This  forum  has
taken  the  lead  in  efforts  to  streamline  donor  procedures  and  monitor  adjustment
programs  for  efficacy  in  poverty  reduction,  as  well  as  review  donor  practices  in
support  of  reform  and  provides  intellectual  leadership  on  a  range  of  development
issues. During the Autumn of 2002, the Commission co-led with the UK Department
for  International  Development  three  action  learning  missions  to  Ethiopia,  Rwanda
and Senegal. The objective of these missions  was to assess and  give momentum to
the harmonisation of donor support around national poverty reduction strategies and
budget cycles. The implementation of this framework will be at  the heart  of SPA’s
work  in  the  next  few  years:  the  6th  phase  of  the  SPA  (2003-2006)  has  as  its  main
focus  the  harmonisation  of  donor  support  around  poverty  reduction  strategies,  in
particular budget and sector support.

Strategic Partnership with Africa (SPA) - Action Learning missions: main findings

Countries have made efforts in developing participatory poverty reduction strategies

Donors’ alignment behind the Poverty Reduction Strategies (RSs) has been so far disappointing

Need  for  Governments  to  operationalise  their  PRSs,  ensure  link  with  budget  cycle  and  sector
strategies, and annualise the list of policy measures and indicators

Urgent  need  for  donors  to  start  aligning  their  programming,  reviewing  and  monitoring
processes with the national PRS and budget cycle.

1.6

The Path to the Future

This  chapter  has  highlighted  a  range  of  different  factors  that  have  affected  the
context  in  which  the  Community’s  development  cooperation  policy  and  external

27

assistance  operates  during  2002.  These  have  provided  new  strategic  challenges  but
also  new  opportunities.  In  the  years  ahead,  an  enlarged  EU  should  be  even  better
placed to play a leading role in taking forward the global agenda for growth, poverty
eradication and sustainable development that was confirmed in 2002.

28

2.

THE REFORM PROCESS - STEPS FORWARD IN 2002

On  16  May  2000,  the  Commission  launched  a  programme  of  reform  of  the
management of external assistance27. Among its main objectives:

– 

– 

– 

Improve the quality of projects and programmes;

Reduce the time needed for implementation;

Ensure  that  procedures  for  financial,  technical  and  contractual  management
conform to the highest international standards

The  nature  of  the  task  requests  considerable  efforts  as  the  several  programmes  the
EC  must  deal  with  have,  each  of  them,  a  different  character  and  specific  focus,
according  to  the  specific  regulation  of  the  programme.  Within  these  limits,
significant  measures  have  been  launched  and  implemented  in  2002  in  order  to
improve  the  quality  of  the  EC  managed  assistance  programmes  and  projects.  The
different  “Quality  Support Groups”, the improved financial management  and,  more
particularly,  the  advance  of  the  deconcentration  process  are  among  the  important
steps taken in 2002.

2.1.

QUALITY IMPROVEMENT

Programming is now centred on Country/Regional Strategy Papers (CSP/RSP) which
set out a ‘strategic framework’ for the EC’s co-operation priorities in a given country
or  region28.This  is  the  first  time  that  the  Commission  has  set  up  a  coherent
framework for its relations with third countries covering both development assistance
and other essential relevant Community policies (the ‘policy mix’).

In 2001, the Commission initiated the process of establishing Country and Regional
Strategy  Papers  (CSP)  and  Regional  Strategy  Papers  (RSP)  for  partners  in  all
concerned  regions  (ACP,  ALA,  CARDS,  MEDA,  TACIS).  These  new  strategies
have  been  developed  in  collaboration  with  national  governments,  Member  States,
other  bilateral  multilateral  donors  and,  wherever  possible,  with  representatives  of
civil  society29.  The  CSP  process  has  a  very  broad  and  ambitious  scope  and  covers
more  than  160  partner  countries  and  8  partner  regions.  As  of  the  end  2002,  the
Commission had finalised and made public 102 new CSPs and 14 RSPs (available on
the  Internet30).  A  number  of  additional  strategies  are  well  advanced  in  the  drafting
process and will be published shortly. These programming documents show how the

27

28

29

30

SEC(2000)814  of  16  May  2000  –  Communication  from  the  ‘Relex’  Commissioners:  Mr  Patten
(External Relations), Mr Nielson (Development), Mr Verheugen (Enlargement), Mr Lamy (Trade) and
Mr Solbes Mira (Economic & Monetary Affairs)
SEC(2000)814, SEC(2000)1049 of 15 June 2000, and Conclusions of 10 November 2000 Development
Council
Consultation of Civil Society is an obligation under article 2 of the Cotonou Agreement
CSPs and RSPs for ACP Countries:
http://europa.eu.int/comm/development/strat_papers/index_country_fr.htm
http://europa.eu.int/comm/development/strat_papers/index_region_fr.htm
CSPs and RSPs for ALA, MED, CARDS, TACIS:
http://europa.eu.int/comm/external_relations/sp/index.htm

29

                                                
Commission’s  external  assistance  is  to  be  implemented  over  the  period  2002  –
2004/07 (applicable time period depending on the region).

A  Progress  Report  on  the  Implementation  of  the  Common  Framework  for  Country
Strategy  Papers (“CSP Framework”)31 was prepared at the  request  of  the  Council32
and  was  presented  in  November  2002.  It  covers  the  drafting  process  of  the  “first
generation”  of  CSPs/RSPs.  Special  attention  is  paid  to  co-ordination  with  the
Member States (both in the field and in Brussels).

Challenges ahead include:

– 

– 

– 

– 

putting in place a comprehensive CSP review mechanism,

taking into account new EC/EU policy initiatives (e.g. anti-terrorism, migration
issues  and  initiatives  emerging  from  the  Doha  process  and  follow-up  to  the
World Summit for Sustainable Development)

improving the focus on results and performance and

reducing  transaction  costs  for  partner  countries  by  working  towards  the
harmonisation of donor procedures surrounding country strategies.

An inter-service Quality Support Group  (iQSG) has been created.  Its main task has
been to screen and assess draft Country and Regional Strategy Papers and Indicative
Programmes  and  propose  any  necessary  improvements  in  order  to  ensure  a
consistently high quality. In order to achieve maximum impact, the iQSG intervenes
at  an  early  stage  in  the  programming  process.  This  screening  revealed  that  even
though  a  qualitative  leap  in  multiannual  programming  has  taken  place,  all  the
possibilities  that  the  new  Framework  provides  were  not  fully  developed.  Certain
typical difficulties in the CSP process were to achieve sufficient concentration of aid,
to  make  a  fully-fledged  policy  coherence  analysis,  operationalising  the  concept  of
“Linking  Relief,  Rehabilitation  and  Development”, 
identifying  performance
indicators and mainstreaming policies for governance and Human Rights, gender and
environment.

The  iQSG  has  also  drafted  Guidelines  on  the  implementation  of  the  Common
Framework  for  Country  Strategy  Papers,  organised  various  training  seminars  on
programming and established a website on the Commission’s Intranet to improve the
internal communication between all involved in programming.

EuropeAid  Co-operation  Office  has  put  in  place  various  Quality  Support  Measures
geared at ensuring that work is of good quality, fulfils the procedural and substantive
requirements and embodies state of the art approaches in the relevant fields. Some of
the key measures adopted in 2002 are the creation of the Quality Support Groups at
regional  level,  the  establishment  of  ten  (10)  Thematic  Networks  on  the  relevant
priority  areas  identified  by  Commission  and  Council  and  the  development  of
guidelines  and  other  operational  documents.  These  are  also  being  translated  in

31

32

Commission Staff Working Paper, SEC (2002) 1279, 26.11.2002
Council conclusions on the Common Framework for Country Strategy Papers of 10
November 2000, point IV

30

                                                
training  programmes  available  both  at  headquarters  and  Delegations.  In  2002,  the
Budgetary  Support  Thematic  Network  has  successfully  contributed 
the
development  of  a  Methodological  Guide  and  its  related  training  programme.  In
addition  to  the  Guide  on  Budgetary  Aid,  a  Guide  on  Sector  Approaches  has  been
finalised in 2002.

to 

2.1.1. Orientation debate Commission/Council

The  reform  process  has  been  accompanied  by  the  search  for  an  improved  match
between  political  priorities  and  budgetary  allocations.  Discussions  began  at  the
September 2000 informal meeting in Evian and continued at the January 2001 GAC
meeting.  The  discussion  in  2002  evolved  around  such  questions  as  integrating
development and foreign policy objectives, improving flexibility and responsiveness
to new situations, balancing the need for speedy delivery of external assistance and
the quality of such assistance, and how to improve the impact of the Union's external
action in different regions. It was particularly suggested that the Commission should
continue to reflect on the concept of regional strategies, the development of Country
Fact  Files  and  the  strenghtening  of  the  role  of  the  EC  delegation  by  the
“decentralisation” process.

2.2.

Improving financial management and performance

The  16  May  2000  Communication  envisaged  a  specific  initiative  to  screen  all
commitments  made  prior  to  1995  and  all  dormant  commitments  dating  from
1995/96/97.

The total stock of opened commitments (budgetary and EDF commitments) has been
reduced at the end of 2002 to the equivalent of 3.8 times the annual budget in terms
of payments compared to 4.7 times at the end of 1999. Only part of the total stock of
RAL has been considered as abnormal (this part represented 14% at the end of 2002
and  21%,  if  measured  at  1st  January  2003,  with  budget  year  1997  added  to  "old
commitment".

Budgetary commitments : By the end of 2002, the level of budgetary commitments
made prior to 1995 (old commitments) had been reduced to €224 million (a reduction
of 80%) compared to €1,092 million on 23 November 1999,when a first inventory of
old  commitments  was  made.  .  Moreover,  by  the  end  of  2002,  the  level  of  dormant
commitments  (including  those  from  1999)  had  been  reduced  to  €634  million
(compared to €1350 million on 31 December 2000).

EDF  commitments  :  the  level  of  EDF  commitments  made  prior  to  1995  had  also
been reduced from €901 million on 31 December1999 to €363 million by the end of
2002 (a reduction of 60%). The situation of dormant commitments had been reduced
to €449 million on 31 December 2002 (compared to €536 million on 31 December
2000).By 1 November 2002, the level of budgetary commitments made prior to 1995
had been reduced by 76% compared to 23 November 1999 (when a first inventory of
old  commitments  was  made),  a  reduction  of  some  €831  million.  Moreover,  by  1st
November 2002 the level of dormant commitments (including those from 1999) had
been reduced to €722,28 million (compared to €1350 million on 31 December 2000).
EDF commitments made prior to 1995 had also been reduced from €901 million in
1999 to €432 million by November 2002.

31

In order to reduce the time lag between commitments and payments and rationalise
the execution of the budget, one of the main actions undertaken by EuropeAid Co-
operation  Office  has  been  to  try  to  spread  its  operations  more  evenly  across  the
financial year. Important progress has been reached in 2002 in this field. About 41%
of  the  available  credits  have  been  committed  in  the  last  quarter  of  the  year  which
represents a substantial improvement compared to 2001 result when around 50% of
the credits were committed in the last 3 months of the year.

2.3.

Further  reunification  of  the  project  cycle  :  EuropeAid  co-operation  Office’s
second year

Since 1st January 2001, the geographic Directorates-General (DG External Relations
and DG Development) are in charge of programming and strategy whilst EuropeAid
Co-operation  Office  is  responsible  for  the  remainder  of  the  project  cycle  (from
identification  of  projects  to  ex-post  evaluation).  This  reorganisation  has  led  to  a
corresponding transfer of staff and responsibilities. An  Interservice  Agreement  was
signed  in  June  2001,  which  clarifies  the  roles  and  responsibilities  of  the  three
Directorates General most closely involved in the management of external assistance.

The EuropeAid Co-operation Office operates under a Board of  Directors composed
of the five Relex Commissioners33. The Board meets at least once every quarter. The
Board  approves  the  Office  Mission  Statement,  the  annual  working  plan  (the
Management  Plan  2003  of  the  EuropeAid  Co-operation  Office  was  approved  in
January  2003),  the  annual  budget  programming,  and  the  annual  activity  report.
Furthermore, it has specific responsibilities in the field of evaluation: it approves the
annual  evaluation  programme,  takes  stock  of  evaluation  results  and  formulates
recommendations.

All managerial posts in the EuropeAid Co-operation Office have been filled, as have
most other vacancies following a large-scale recruitment exercise in February 2001.
During  2002,  due  to  human  turnover,  7  managerial  posts  have  been  filled  and  215
officials were recruited.

The Commission took on responsibility for those tasks previously carried out by the
49 Technical  Assistance  Offices  (TAOs),  whose  contracts  were  terminated  in  2001
or were not renewed. This required the recruitment of 260 additional auxiliary staff
to  work  in  Headquarters  and  70  individual  experts  to  work  in  Delegations.
Furthermore,  the  EuropeAid  Co-operation  Office  was  still  benefiting  in  2002  from
the  services  of  3  Technical  Assistance  Offices,  for  the  management  of  individual
experts throughout the world  and of European  Customs  Officers  in  the  Balkans.  In
2002,  the  decision  was  taken  to  dismantle  these  TAOs  and  to  internalise  the
management, to comply with the new rules on outsourcing and in anticipation of the
new Financial Regulation. Some 30 auxiliary staff were recruited in September and
October 2002 to work in Headquarters on the preparation of the take over from the 3
TAOs  in  order  to  be  fully  operational  in  January  2003.  This  management  is  done
locally with the support of the Delegations, which have been reinforced with 26 local
agent  posts  as  far  as  the  management  of  individual  experts  is  concerned.  As  from

33

Mr Patten (Chairman), Mr Nielson (Chief Executive Officer), Mr Verheugen, Mr Lamy and Mr Solbes
Mira (Members of the Board)

32

                                                
1st January  2003,  there  are  no  more  Technical  Assistance  Offices  working  for
EuropeAid.

The  profiles of the  official  and  contractual  staff recruited  cover the whole range of
expertise  needed  by  headquarters  and  delegations  to  implement  external  aid  in
accordance  with  the  objectives  of  quality  and  speedy  delivery  set  by  the  Reform
(development  economists,  sectoral  experts,  finance  and  contract  professionals,
support staff, etc.). A training package centred on programme management has been
developed and implemented to improve the skills of current staff.

The  EuropeAid  Co-operation  Office  has  developed  a  series  of  indicators  aimed  at
the  reform
measuring  progress  in  implementing 
programme:  improved  execution  of  the  budget  (for  example,  75%  of  invoices  paid
within  60  days),  reduction  in  old  and  dormant  commitments,  rationalisation  of
budget  lines,  deconcentration,  etc.  These  indicators  are  used  to  compile  a  regular
progress report on the management of the EuropeAid Co-operation Office, which is
presented to the Board.

the  principal  elements  of 

2.3.1.

Budget and EDF implementation

Overall  results  of  2002  budget  implementation  are  very  satisfactory.  Since  the
beginning  of  the  year,  €3877  million  have  been  committed  (compared  with  €3641
million in 2001) and €3327 million paid (an increase of €152 million compared with
2001).

With regard to the EDF, the results are in line with the latest forecasts, the level of
commitments amounting to €2114 million and of payments to €1902 million.

The stock of opened commitments has been stabilised in absolute terms, at the level
of  €19,8  billion  (-  €40  million  compared  with  2001).  Expressed  in  payment  years,
this stock remains stable at the level of 3,8 years, compared to 4,6 years at end 1999.

2.3.2.

Simplification and harmonisation of contractual and financial procedures

In addition to these measures, the EuropeAid Co-operation Office has implemented
simplified and harmonised contracting procedures (reduced in number from 46 to 8)
through the production of the Practical Guide to EC external aid contract procedures.
Standard  documents  have  also  been  created,  and  should  now  be  applied  to  all
Community  programmes.  A  new  general  framework  has  been  adopted  for  the
European  Development  Fund  that  is  very  similar  to  the  one  used  for  projects
financed from EC funds. These measures have reduced the time needed to complete
the  tendering  process  and  facilitated  the  implementation  of  projects.  Significant
progress  has  been  made  towards  greater  transparency.  After  an  initial  surge  of
interest,  the  EuropeAid  Web  site  now  consistently  achieves  around  1  million
successful  page  requests  per  month.  The  site  includes  information  about  contracts
and  procedures  for  all  the  external  aid  programmes.  A  survey  of  those  accessing
these pages launched before the end of 2001 has shown a high level of satisfaction
among users.

33

Furthermore,  a  framework  agreement  was  concluded  with  the  World  Bank,  and  a
revised  framework  agreement  negotiated  with  the  United  Nations,  in  order  to
enhance the co-operation with these institutions.

The  16  May  Communication  also  foresaw  an  harmonisation  of  budget  lines,  and
these have now been reduced from 64 (in 2000) to 53 (in 2002). This effort has been
pursued in 2002, and the Commission proposed in the PDB 2003 a further reduction
to 49 budget lines. However, the Parliament did not accept all Commission proposals
and also decided to create 4 new budget lines. Eventually, the number of lines to be
managed by the Office will be slightly increased.

In 2002, the EuropeAid Co-operation Office has established a Finance Guide for the
external actions financed from the General Budget of the EC and  updated the  User
Guide to the financial procedures of the 7th and 8th EDF. Finally, the new Financial
Regulation34  was  adopted  by  the  Council  on  the  25  June  2002  and  came  into
application  on  1  January  2003.  Among  other  changes,  the  new  provisions  in  the
section  on  external  actions  introduce  a  "sunset  clause"  requiring  that  all  contracts
implementing a Financing Agreement, except those concerning audit and evaluation,
are  signed  within  three  years  from  the  date  of  adoption  of  the  budgetary
commitment.

2.3.3. Management systems : CRIS

During  2002,  the  EuropeAid  Co-operation  Office  completed  the  integration  of  the
numerous information systems used for the programmes financed via the budget into
one  single  harmonised  system  –  CRIS  (Common  Relex  Information  System).
Therefore,  as  from  January  2003,  the  management  of  all  programmes  financed  via
the  budget  is  supported  by  one  management  system.  CRIS  is  not  just  containing
financial data –  but  also  a  wealth  of  non-financial  information  of  relevance  for  the
implementation and is therefore superior to the previous information systems used. It
links  up  electronically  Headquarters  and  Delegations  and  allows  for  on-line
registration, communication and reporting of data. CRIS will significantly  facilitate
the  Commission’s  ability  to  provide  on-time  financial  data  to  Council  and
Parliament. Data that will be fully DAC compatible. The transfer of data from the old
systems into CRIS was not only technically complex but also very resource intensive
because the quality of the historical data in many cases had to be verified, corrected
and completed in view of the stricter requirements of CRIS. With this, one of the key
initiatives of the reform of the external assistance has been successfully  completed.
Efforts  will  continue  in  2003  to  integrate  also  the  European  Development  Fund  in
CRIS.

2.4.

Deconcentration

The  deconcentration  of  the  management  of  external  aid  to  the  Delegations  of  the
Commission  is  a  key  element  of  the  reform  of  the  management  of  the  external
assistance. The principle is that what can be better managed and decided on the spot,
in the country concerned, should be done there, and not in Brussels.

34

Council Regulation EC n° 1605/2002 of 25.06.2002

34

                                                
The  Commission  has  set  itself  an  extremely  tight  timetable.  The  objective  is  to
extend  deconcentration  to  all  the  Delegations  before  the  end  of  2003,  in  three
successive  waves:  21  Delegations  have  been  covered  in  2001,  26  to  be  covered  in
2002 and the remaining 30 Delegations in 2003, all of them in ACP countries.

2.4.1.

Preparing for Deconcentration

During  the  first  quarter  of  2001,  a  harmonised  concept  of  deconcentration  was
defined, covering all the geographical programmes. The principles on which this was
based remain valid and are recalled below:

– 

– 

– 

– 

in time, deconcentration will concern all programmes;

deconcentration will concern all the phases of the project cycle;

deconcentration  requires  the  provision  of  substantial  additional  resources
(human and material);

the  role  of  Headquarters  will  evolve  towards  a  role  of  co-ordination,  quality
supervision,  management  control,  technical  support  and  improvement  of
working practices.

At  a  practical  level,  deconcentration  involves  the  following  changes  for  the
Delegations:

– 

– 

– 

– 

a  more  active  contribution  to  programming,  although  final  responsibility  will
remain  with  the  External  Relations  or  Development  DGs  according  to  the
geographical area;

for 

identification 

responsibility 

direct 
stages,  with
methodological  and  technical  support  by  the  EuropeAid  Co-operation  Office,
which will also be responsible for final quality control on financing proposals
and  for  taking  these  through  the  decision  process  (management  committee
procedures, etc);

appraisal 

and 

direct  responsibility  for  contractual  and  financial  implementation  –  this  is
subject  to  the  strict  respect  of  procedures,  and  requires  secure  access  to  the
financial and accounting management systems at Headquarters;

direct responsibility for technical implementation requiring technical expertise
on  the  spot  and  the  possibility  to  call  on  more  specialised  advice  from
headquarters.

Much of what has been done to render the first phase operational will also serve to
facilitate  the  extension  of  the  process  to  the  remaining  Delegations,  such  as  the
adaptation  of  information  systems  for  deconcentrated  management,  developing  or
updating  manuals  of  procedures,  developing  guidelines  on  financial  circuits  and
putting  in  place  training  programmes.  However,  much  preparatory  work  will  be
specific  to  each  Delegation  to  be  deconcentrated,  such  as  the  testing  of  secure
computer connections,  ensuring suitable  office  accommodation,  and  adoption  of  an
organisation chart.

35

2.4.2. Deconcentration towards the 21 First Wave Delegations

The ambitious objective for 2001 – to carry out deconcentration in 21 Delegations35 -
covered all the geographical areas and therefore programmes of a very varied nature.
This was a major exercise, involving the recruitment and training of over 300 staff,
finding  new  office  space  in  all  but  two  Delegations  and  installing  secure  computer
connections in 19 Delegations. This objective has been fully met and deconcentration
is  now  fully  operational  in  all  these  Delegations.  However,  it  is  worth  mentioning
that,  from  October 2002, 114  posts have  been made available to  launch  the  second
wave and some of these posts may still be used to strengthen first wave Delegations
where necessary.

2.4.3.

Preparation of the Second Wave 26 Delegations and the EC Office in Kabul

The  list  of  26  Delegations36  to  be  deconcentrated  in  2002  was  established  in
September 2001. Preparatory work started immediately thereafter and hearings took
place from early January.

The outcome of this process for the second wave Delegations can be summarised as
follows:

– 

– 

– 

A total of 418 staff had to be selected, recruited and trained before their posting
to the 26 Delegations;

24  out  of  the  26  Delegations  have  either  had  to  move  office  or  to  rent
additional office space;

18 out of the 26 had no secured computer connection in order to get access to
Commission accounting and management information systems.

Despite the magnitude of the operation, the process is on track. 23 Delegations have
started to operate in a deconcentrated way in late 2002 or will be ready to start early
in  2003  with  the  new  budget  year.  In  the  4  remaining  Delegations,  problems  are
mainly  of  a  logistical  nature  and  efforts  are  under  way  to  resolve  these  by  March
2003.

Deconcentration 
in  Kabul  has  also  progressed
satisfactorily with everything in place to commence deconcentration in January 2003.

the  Commission  Office 

to 

35

36

The 21 “first wave” Delegations are:
EUROPE: Croatia, Russia
ASIA: Indonesia, Thailand, India, China
LATIN AMERICA: Nicaragua Bolivia, Argentina, Mexico, Brazil
AFRICA/ACP: South Africa, Senegal, Ivory Coast, Kenya, Mali, Dominican Republic
The “2nd wave” Delegations are :
EUROPE : Albania, Georgia, Kazakhstan, Ukraine
MEDA : Algeria, West Bank & Gaza, Jordan, Lebanon, Syria
ASIA : Bangladesh, Philippines, Pakistan, Vietnam
LATIN AMERICA : Colombia, Peru, Uruguay, Chile, Venezuela
AFRICA/ACP  :  Burkina  Faso,  Benin,  Cameroon,  Ethiopia,  Madagascar,  Niger,  Republic  of  Guinea,
Tanzania

36

                                                
As was the case in the first wave, it appears that the timely availability of sufficient
office  space  represents,  in  many  instances,  the  binding  constraint  for  the  start  of
deconcentration.  This  is  particularly  true  when  temporary  solutions  for  the
installation of a secured computer  connection cannot be found.  In some cases there
has been a shortage of suitable candidate particularly for official posts in the finance
and contract sections.

2.4.4.

Preparation of the Third Wave of 30 Delegations37

Attention will now shift to the third wave delegations, for which technical workshops
took  place  in  July  2002  with  the  Heads  of  Delegations  concerned.  Staffing
requirements,  accommodation  capacity  and  IT  issues  were  analysed  in  detail.
Lessons learned from the 1st and the 2nd waves of deconcentration will be taken into
account in the 3rd wave.

With the ratification of the Cotonou Agreement and the finalisation of a strategy to
provide  sustainable  financing  for  deconcentration  to  ACP  Delegations,  the  first
Delegations  of  the  third  wave  are  expected  to  start  operating  under  deconcentrated
modalities by the end of 2003.

2.4.5. Deconcentration of thematic and horizontal budget lines

Progress  has  also  been  achieved  on  the  deconcentration  of  the  thematic  and
horizontal lines. The Commission services have recently adopted modalities for the
deconcentration  of  the  Food  Security  budget  lines  and  have  agreed  on  the
corresponding  human  resources  needs.  Deconcentration 
to  all  Delegations
concerned38 is scheduled to be implemented between March and December 2003.

Preparatory  work  on  the  deconcentration  of  the  Human  Rights  micro-projects  has
begun and effective deconcentration can be expected by April 2003.

For  rehabilitation  and  refugee  budget  lines,  the  decision  to  deconcentrate  has  been
taken  in  December  2002  and  preparations  are  in  hand  to  render  this  effective  as
quickly as possible.

37

38

The “3rd wave” Delegations are ACP:
Angola, Barbados, Botswana, Burundi, Central African Republic, Rep. Congo
Democratic Republic of Congo, Eritrea, Fiji, Gabon, Ghana, Guinea-Bissau, Guyana, Haiti, Jamaica,
Lesotho, Malawi, Mauritius, Mauritania, Mozambique, Namibia, Nigeria, Uganda, Papua New Guinea,
Rwanda, Sierra Leone, Sudan, Chad, Zambia, Zimbabwe
Kenya, Bangladesh, Burkina Faso, Ethiopia, Georgia, Madagascar and Niger

37

                                                
3.

ONGOING PROGRESS TOWARDS STRATEGIC GOALS

The  previous  chapter  has  highlighted  progress  in  enhancing  the  efficiency  and
quality of the Community’s development policy and external assistance programmes
during  2002,  as  part  of  the  management  reform  initiative.  This  chapter  focuses  on
effectiveness: that is, how far the Community’s development policy and programmes
and  its  other  external  assistance  is  contributing  to  the  achievement  of  the  strategic
goals outlined in Chapter 1 (and how this is being measured), and steps being taken
to increase this effectiveness further.

3.1.

Monitoring Progress Towards Strategic Goals

An  essential  tool  for  maximising  the  contribution  of  the  Community’s  assistance
towards  its  strategic  goals  is  being  able  to  monitor  the  impact  of  current
interventions: not just in terms of inputs (e.g. financial contributions and what these
are spent on) but also, ultimately, outcomes and impacts. This is not straightforward.

At the level of countries and regions, it is rarely possible to separate out the effects of
any single donor’s activities. The impact of any activities, whether entirely domestic
or supported by donors, may also take varying amounts to time to show through in
measurable  form.  Nevertheless,  the  Community  is  committed  to  a  results-based
approach and is working closely with others to develop methods to facilitate this.

The  strategic  goals  mirror  the  complexity  of  EC  development  programmes  with  a
broad  range  of  goals  from  poverty  reduction  to  developing  and  consolidating
democracy and the rule of law, respect for Human Rights and fundamental freedoms.
Naturally  the  wide  range  of  objectives  pose  a  great  challenge  in  constructing  a
coherent and transparent system for monitoring results in various areas.

3.1.1. Monitoring Progress Towards Development Goals

As  explained  in  Chapter  1,  the  key  development  outcomes  that  the  Community  is
working to  achieve between now and 2015, along  with  the  rest  of  the  international
community, are the Millennium Development Goals.

There  is  an  intense  global  effort  underway  to  monitor  progress  towards  these,
involving many different organisations, and it is essential to ensure coordination and
complementarity  between  them.  The  ‘Millennium  Project’  launched  by  the  UN  in
2002  should  contribute  to  this,  by  bringing  together  working  groups  of  experts  to
propose  best  strategies  for  meeting  the  MDGs.  The  Commission  is  working  to
support  the  improvement  of  national  statistical  systems,  in  low-income  countries
usually in the context of Poverty Reduction Strategy (PRS) monitoring support, and
aims wherever possible to do so in conjunction with other donors. In particular, the
Commission is working closely with PARIS 21 (Partnership in Statistics in the 21st
Century  -  a  multi  donor  initiative  to  support  statistical  and  data  systems  in
developing  countries)  and  its  task  team  on  improving  statistical  support  for
monitoring development goals.

38

3.1.2. Defining Core Development Indicators to Measure Progress

interested  parties, 

During  2002,  the  Commission  has  worked  with  an  expert  group  of  Member  States
and  other 
the  OECD  Development  Assistance
Committee  (DAC),  UNDP  and  the  World  Bank,  to  develop  a  core  set  of  10
indicators drawn from the MDGs. Of these 10 indicators, 6 are directly related to the
well being of children, while three have a specific gender dimension.

including 

The Commission intends to monitor progress against these indicators annually for all
developing  countries  to  which  it  provides  assistance.In  addition,  Country  Strategy
Papers  will  also  measure  progress  against  a  wider  range  of  country-specific
indicators,  which  should  reflect  the  focal  sectors  identified  in  the  CSP  as  well  as
overall  movements  in  poverty.  For  low-income  countries,  these  should  be  drawn
from  the  country’s  Poverty  Reduction  Strategy  Paper  (where  one  has  been
completed).

Tracking these indicators will give a solid basis for the Commission’s political  and
policy dialogue with national authorities, as well as enhancing its ability to fine-tune
the strategy in response to developments.

The indicators chosen for cross-country monitoring are the following:

Type

Impact

Outcome

Indicator

Proportion of population below $1 per day39
Prevalence of underweight children (under-five years of age)
Under-five mortality rate40

Net enrolment ratio in primary education41
Primary Completion Rate 42
Ratio  of  girls  to  boys  in  primary,  secondary  and  tertiary
education
Proportion of births attended by skilled health personnel43
Proportion of 1 year old children immunised against measles
HIV prevalence among 15-24 year old pregnant women44
Proportion  of  population  with  sustainable  access  to  an
improved water source

Suggested
periodicity

Medium-
term

Medium-
term

Medium-
term

Annual

Annual

Annual

Annual

Annual

Annual

Medium-
term

39

40

41

42

43

44

For monitoring country poverty trends, indicators based on national poverty lines should be used where
available
The under five mortality rate is the number of children who will die before their  fifth birthday out of
every 1000 babies who are born (officially defined as the probability of dying between birth and exactly
five years of age, expressed per 1000 live births)
The percentage of primary school age children that enrol in primary education.
The  near-equivalent  MDG  indicator  is  ‘proportion  of  pupils  beginning  the  first  year  in  the  primary
education and completing the fifth year.’
Data  on  “maternal  mortality  ratio”  are  infrequent,  model-based  and  lack  quality.  A  good  proxy  is
provided by “births attended by skilled health personnel”
Reported as prevalence in women in general, but in fact these data are derived from surveys of pregnant
women in antenatal clinic

39

                                                
GDP  per  capita  and  GDP  growth  will  also  be  monitored  in  every  country.  More
details of the Commission’s approach can be found in its ‘Guidelines on the use of
indicators to measure country performance’.45

3.1.3.

Analysis of Progress Towards the MDGs

In  late  2002/early  2003,  the  Commission  carried  out  a  first  analysis  of  progress
towards the MDGs using the above indicators. This was done for 140 countries in 8
regions where the Community provides assistance, in order to allow a cross-country
and  cross-regional  comparison46.  This  analysis  used  data  provided  by  international
organisations  including  the  World  Bank,  UNDP,  FAO,  UNICEF,  UNESCO  and
WHO47. Although the availability of data is improving, there are still gaps that limit
the  number  of  countries  where  it  is  possible  to  measure  the  evolution  over  the  last
five or ten  years. The quality of data also varies between indicators. It is especially
insufficient on the lead poverty indicator of “proportion of population below $1 per
day”  (so  the  proxy  of  GDP  per  capita  was  used  instead)  and  “primary  school
completion rate”.

The  diamond  charts  below  illustrate  the  results  of  this  analysis  for  the  different
regions, on four indicators simultaneously: under five mortality rate, primary school
enrolment, access to improved water source and GDP per capita. The values used to
build these graphs are generally those from the year 2000. A value of 100 represents
the  developing  world  average,  so  a  score  above  this  indicates  that  the  region’s
performance  is  above  average.  A  value  of  100  represents  the  developing  world
average,  so  a  score  above  this  indicates  that  the  region’s  performance  is  above
average. These averages (a score of 100) are equivalent to:

75/1000 for under-five mortality rate (year 2000)

87% for primary school enrolment ration (most recent year)

77% for access to an improved water source (year 2000)

US$ 1129 for GDP per capita, measured in constant 1995 dollars (year 2000)

With regard to the under-five mortality rate, a higher figure in the chart represents a
better performance (a lower under-five mortality rate

45

46

47

EC, December 2002 (http://europa.eu.int/comm/development/sector/poverty_reduction/index_en.htm).
Africa  (48),  Asia  (19),  Balkans  (5),  Caribbean  (15),  Eastern  Europe  and  Central  Asia  (10),  Latin
America (17), Pacific (14) and South Mediterranean, Near and Middle East (12). In each region, some
countries are missing quite regularly. For Asia region, indicators are calculated with or without China.
In case of significant contradiction between sources, arbitration is done taking into account general date
availability, methodological notes etc…

40

                                                
AFRICA

GDP per capita constant year 2000

Under 5 mortality rate (reversed)*

45

45

72
72

51

51

64

64

Improved w ater source (% of population
w ith access) 

School enrollment, primary (% net)

ASIA

GDP per capita constant year 2000

Under 5 mortality rate (reversed)*

114

66

102

106

Improved w ater source (% of population
w ith access) 

School enrollment, primary (% net)

41

Eastern Europe & Central Asia

GDP per capita constant year 2000

Under 5 mortality rate (reversed)*

69

113

107

100

Improved w ater source (% of population
w ith access) 

LATIN AMERICA

School enrollment, primary (% net)

GDP per capita constant year 2000

351

Under 5 mortality rate (reversed)*

221

111

Improved w ater source (% of population
w ith access) 

112

School enrollment, primary (% net)

42

South Mediterranean & Near & Middle East

Under 5 mortality rate (reversed)*

GDP per capita constant year 2000

157

115

139

101

School enrollment, primary (% net)

Improved w ater source (% of population
w ith access) 

BALKANS

GDP per capita constant year 2000

Under 5 mortality rate (reversed)*

383

134

125

78

Improved w ater source (% of population
w ith access) 

School enrollment, primary (% net)

43

PACIFIC

GDP per capita constant year 2000

Under 5 mortality rate (reversed)*

99

86

62

100

Improved w ater source (% of population
w ith access) 

School enrollment, primary (% net)

CARIBBEAN

GDP per capita constant year 2000

Under 5 mortality rate (reversed)*

150

105

154

106

School enrollment, primary (% net)

Improved w ater source (% of population
w ith access) 

3.1.4

Key Findings

The  most  persistent  poverty  and  the  widest  gaps  are  found  in  sub-Saharan  Africa,
which will struggle most as a region to achieve the Millennium Development Goals.
Development efforts in the region are being undermined by other challenges, such as
the spread of communicable diseases, new and ongoing conflicts  and crises and, in
late 2002 and 2003, serious food shortages. Whilst sub-Saharan Africa will struggle
most, as a region, to achieve the MDGs, they are not just an African issue. The UN
Secretary  General’s  2002  Report  on  the  Implementation  of  the  UN  Millennium
Declaration highlighted marked differences between and within regions48.

48

2002  Report  of  the  Secretary-General  on  the  Implementation  of  the  UN  Millennium  Declaration
(A/57/270). http://millenniumindicators.un.org/unsd/mi/mi_worldregn.asp

44

                                                
The diamond charts  show  that, whilst development  is  fairly  symmetrical  across  the
four  indicators  considered  in  regions  with  lower  incomes,  this  pattern  does  not
always apply to the more prosperous regions. In Africa,  which is comprised almost
entirely of low income countries as reflected by a level of national income (GDP) at
51%  of  the  average,  performance  on  the  other  indicators  is  also  around  50-70%  of
average, although under five child mortality is particularly high. In Asia and Eastern
Europe,  Central  Asia  and  the  Pacific,  where  income  is  still  relatively  low,  overall
performance on the other indicators is above average. The South Mediterranean and
Near  and  Middle  East  and  Caribbean  regions  are  composed  of  countries  that  are
considerably  better  off  than  average,  and  performance  on  the  other  development
indicators  is  also  better  than  average.  Latin  America  is  made  up  of  middle-income
countries, and here GDP is way  above average, with performance on the indicators
also  well  above  average  and  near  the  maximum  possible  for  school  enrolment
(115%). The pattern in the Balkans shows very good performance on reducing under-
five mortality in these mostly lower middle income countries, and surprisingly poor
performance on school enrolment.

The graphs show for example that at the end of 2000 the level of school enrolment in
the Balkans, Latin America, Caribbean or even Mediterranean countries is far lower
than the level of GDP per capita would have led to expect49.

Access  to  water  remains  a  problem  for  most  regions,  in  particular  the  Pacific  and
Caribbean countries.

Concerning  under-five  mortality  rate,  whilst  the  situation  in  Africa  and  Asia  is
particularly worrying, the situation in Latin America and MEDA countries is less that
could be expected given their level of GDP per capita.

Key  findings  that  relate  to  the  6  priority  areas  of  the  Community’s  assistance  are
discussed below. Water is covered in the Special Feature.

3.2.

Maximising the impact of EC assistance

3.2.1. Defining Country and Region Specific Response Strategies

The  analysis  above  confirms  the  need  for  the  Community  to  adapt  its  approach  in
each  region  and  country,  in  view  of  differences  in  the  scale  of  the  challenges  that
these  face.  Chapter  6  of  this  report  gives  an  overview  of  how  the  Community  is
responding  to  regional  specific  issues.  The  Commission’s  country  and  regional
strategy  paper  process  outlined  in  the  previous  chapter  is  designed  to  allow  it  to
develop  tailored  response  strategies.  The  mid  term  review  of  these  provides  an
opportunity  to  consider  if  any  amendments  are  needed,  including  based  on  the
analysis  above  about  which  regions  and  countries  are  lagging  behind  on  particular
objectives.

In  the  same  way  that  monitoring  progress  needs  to  be  a  collective  effort,  devising
response  strategies  is  also  not  something  that  the  Commission  can  do  in  isolation.

49

The result for the Balkans has to be read with caution since it only covers three countries of which both
The Federal Republic of Yugoslavia and Croatia are amongst the  worst 10 performing countries  with
significant drops in enrolment (-27% and -12% respectively). Figures for Central Asia and the Pacific
are not representative as they are based on a single country.

45

                                                
Instead, it must work with countries themselves and other donors, to help identify the
key priorities in each case and how Community assistance can best help to address
these.  In  line  with  its  commitment  to  a  partnership  approach  based  on  local
ownership,  the  Commission  uses  countries’  own  national  development  strategies
(Poverty  Reduction  Strategies  in  low-income  countries)  as  the  starting  point.  The
EC’s  Country  Strategy  Papers  set  out  the  Community’s  response  to  this,  taking
account  of  other  donors’  plans.  Regional  strategy  papers  are  similarly  prepared  in
consultation  with  countries  in  the  region,  regional  bodies  and  other  donors,  and
provide  a  means  for  the  Community  to  help  effectively  address  challenges  that  cut
across the whole region.

3.2.2.

Effective Targeting of Resources

As part of its commitment to increasing the impact of its assistance, the Community
has committed to pay particular attention to the situation of the least developed and
other  low-income  countries.  In  2000,  59%  of  EC  bilateral  ODA  went  to  these
categories  of  countries;  the  bulk  of  the  rest  (35%)  went  to  lower  middle-income
countries50.

As well as need, the Community’s resource allocation decisions also take account of
the  efforts  of  governments  of  partner  countries  to  reduce  poverty  as  well  as  their
performance and absorption capacity.

A performance-based allocation methodology was agreed for ACP countries as part
of the 9th European Development Fund. There is an opportunity to consider topping-
up  of  allocations  to  countries  (as  well  as  reductions)  after  CSP  mid-term  reviews.
Allocations  to  regions  can  also  be  revised  after  midterm  reviews  and  if  necessary
even  before,  in  case  of  special  performance.  In  early  2003,  the  Commission  will
begin discussing with EU Member States and ACP partners the possibility to use €1
billion of the 9th EDF (that was held back by Member States as a reserve, conditional
upon disbursement of the rest of the Fund) to establish an EU Water Fund to support
implementation  of  the  EU  Water  Initiative  launched  at  the  World  Summit  on
Sustainable  Development  (see  Special  Feature,  Chapter  7).  The  objective  of  this
Fund  would  be  to  develop  innovative  and  flexible  approaches  and  to  leverage  aid
resources (ODA) with private investments.

3.2.3.

Addressing Debt Sustainability

One  of  the  critical  elements  of  the  MDG  ‘to  develop  a  global  partnership  for
development’  is  to  deal  comprehensively  with  the  debt  problems  of  developing
countries  through  national  and  international  measures  in  order  to  make  debt
sustainable in the long term. The Community has continued to play an important role
in this area during 2002, through its support for the enhanced debt relief initiative for
Heavily  Indebted  Poor  Countries  (the  HIPC  process).  As  of  the  end  of  2002,  the
Community’s  total  pledge  was  over  €1.27  billion:  €  734  million  as  a  donor  to  the
multilateral  HIPC  Trust  Fund;  and  €  485  million  as  a  creditor  to  finance  the
settlement of its own claims; plus an additional € 60 million, again as a creditor, to
alleviate all remaining special loans granted to least developed ACP HIPCs.

50

OECD DAC Peer Review of EC  Aid,  2002. Table  II-3. This  excludes  26%  of  bilateral  EC  ODA  not
allocated in this assessment.

46

                                                
The  HIPC  initiative  is  still  facing  important  challenges,  namely  full  financing,
ensuring  long-term  debt  sustainability  and  dealing  with  difficult  country  cases,
essentially  HIPCs  emerging  from  conflict  and/or  with  substantial  problems  of
arrears.  The  Commission  remains  committed  to  covering  the  potential  cost  of  the
topping up caused by the global economic downturn and the fall of commodity prices
on a fair burden-sharing basis. The Community’s overarching objective is to ensure
that, within HIPC, developing countries can reach and maintain in the longer term a
sustainable  level  of  debt,  reinforce  their  efforts  to  reduce  poverty  and  promote
growth. For this reason, the Community has consistently stressed the importance of
strengthening the link between provision of debt relief through HIPC and process of
donor  support  for  countries’  national  poverty  reduction  strategies  (the  PRSP
process).

3.2.4.

Increased Use of Sector Wide Approaches and Budget Support

The  Community  is  increasingly  providing  assistance  to  developing  countries  in  the
form of sectoral support, as well as budget support for macroeconomic policies. This
is consistent with the approach outlined in the November 2000 Joint Declaration on
Development Policy,  which spoke of “increased recourse to sectoral support and to
direct budgetary aid where the conditions so allow”.

This  shift  is  based  on  the  belief  that  it  will  help  to  enhance  the  impact  of  the
Community’s aid and increase ownership. In contrast to a standalone project, a sector
wide approach enables  the Community  to  tackle  a  much  wider  range  of  issues  that
are  likely  to  affect  the  intended  outcome  of  the  intervention,  working  closely  with
other donors and the recipient country. Rather than just financing the construction of
a hospital, for example, the Community might provide support for the government to
implement  a  much  wider  set  of  policy,  management  and  financial  reforms  in  the
health  sector.  This  shift  is  consistent  with  the  Community’s  commitment  to  a
partnership  approach  with  developing  countries,  which  promotes  local  ownership
(which recent experience has shown to be a critical factor in the success of external
assistance interventions). It  also helps to  build local capacity,  since  it  works within
national  procedures  rather  than  bypassing  these.  It  also  promotes  coordination  and
complementarity between donors. The sectors where the Commission, together with
other donors, is applying a sectoral approach include transport, health, education and
agriculture.

Budget  support  goes  a  step  further  than  sector  programmes,  in  providing  direct
budgetary  aid.  The  bulk  of  the  Community’s  budget  support  is  directed  to  both
maintain a stable macroeconomic  framework,  an  essential condition for  stimulating
economic growth, and to sustain progress in key policy areas such as public finance
management,  health  and  education.  Community  support  is  designed  to  be  fully
coherent with the beneficiary country’s poverty reduction strategy. Further details are
provided below.

In  a  number  of  countries  (such  as  countries  in  crisis,  or  with  weak  administrations
unable  to  co-ordinate  donors)  it  is  clear  that  it  will  be  necessary  to  maintain  a
“project approach”. However, even in these countries, it would be appropriate to: i)
accompany  traditional  projects  with  sectoral  type  support  in  those  areas  (e.g.  sub-
sectors)  where  sufficient  capacity  exists,  and  ii)  support,  wherever  appropriate,  the
building up of capacity to lay the foundations for a transition towards the programme
approach.

47

3.2.5.

Focusing on a Limited Number of Priorities

In  line  with  its  commitment  to  work  together  with  other  donors  to  achieve  its
strategic objective, the Community has identified 6 priority areas for its assistance to
developing  countries.  These  are  areas  where  the  Commission  and  Council  have
agreed that it has a specific value added. They are as follows: the link between trade
and development; regional integration and  cooperation; support for macroeconomic
policies  and  equitable  access  to  social  services;  transport;  food  security  and  rural
development;  and  institutional  capacity  building  in  particular  good  governance  and
the rule of law. A smaller number of areas for intervention are agreed in each country
and  regional  strategy,  in  consultation  with  the  country  or  countries  concerned  and
taking account of other donors’ plans.

In  2002,  the  Commission’s  inter-service  Quality  Support  Group  carried  out  a
preliminary  analysis  of  the  extent  to  which  Country  Strategy  Paper  allocations
followed  these  6  priority  areas.51  This  was  complicated  by  the  fact  that  the
Community’s classifications do not match up perfectly with the sectoral codes set by
the OECD Development Assistance Committee. This also did not include allocations
from horizontal and thematic budget lines. It also only looked at country programmes
(the bulk of the Community’s support for regional integration and cooperation comes
under regional programmes – see regional chapters of this report – so it is excluded
from the table below).

Insofar  as it was possible  to  compare  the  6  areas  with  resource  allocation  by  DAC
sector code, the analysis suggested that the CSP process has led to a concentration of
the Commission’s aid in the intended areas.

Concentration of Community Resources
in Priority Areas from CSPs

Area of concentration

Corresponding DAC sector(s)

Share of total resource allocation

Trade and Development

Sector 33

5.9 %

Trade and Tourism

to 

NB  This  figure  includes  only  those
actions  directly  relating 
trade
promotion  and  classified  as  such
under DAC codes. It excludes a wide
range  of  actions  addressing  more
fundamentally  the  improvement  of
investment
trade 
the 
environment. 
addition,
approximately  50%  of  the  resources
regional  programmes  are
under 
trade  and
devoted 
development.

to  supporting 

and 
In 

Sector 51

14.7 %

Structural  adjustment  with  the
World Bank and IMF

this  figure 

includes  macro-
NB: 
economic  support  with  social  sector
conditionalities, 
to
improved  health 
education
outcomes  and  financing  for  health

linked 

and 

i.e. 

Support 
macroeconomic policies

for

51

SEC(2002) 1279 of 26 November 2002

48

                                                
and  education  sectors  (see  3.3.3  for
more details)

Targeted 
social sectors

support 

for

Sector 11

21.4 %

Education, Sector 12 Health and
population  programmes,  Sector
14  Water  supply  and  sanitation
and  Sector  16  Other  social
infrastructure

Transport

Sector 21

Transport and Storage

Food  security  and  rural
development

capacity
Institutional 
building, 
Good
Governance  and  the  Rule
of Law

Sector 31

Agriculture, 
Fishing 
and 
Developmental 
Security

Sector 15

Forestry 
Sector 

and
52
Aid/Food

Government and civil society

19.2 %

7.8 %

14.9 %
(NB: Interventions in many  different
areas  include  institutional  capacity
building aspects)

Total share of resources in these areas

83.9 %

3.3

Policy developments in 2002 in priority areas

This section gives an overview of central policy and programming developments in
the 6 priority areas for EC assistance during 2002. A key issue for the Community is
to ensure that its  policy  and interventions  in  each  of these contribute  to  the  overall
country  and  global  objectives  that  have  been  agreed.  Therefore,  the  sections  below
also  highlight  key  findings  from  the  MDG  analysis  exercise  described  above  that
relate to these 6 areas. This analysis exercise was carried out in late 2002/early 2003.
It  will  inform  Community  policy  and  programmes  going  forward.  The  results  of
programme and sector evaluations carried out in 2002 will also feed into future work.

During  the  course  of  2003,  the  Commission  will  also  be  working  with  Member
States to take forward the two EU initiatives in water and energy launched at WSSD.

3.3.1

Trade and Development

The Community’s key objectives in this area during 2002 remained to help make the
ongoing  World  Trade  Organisation  round  of  multilateral  trade  negotiations
supportive  of  development,  in  line  with  the  principles  agreed  in  the  ‘Doha
Development Agenda’52; and to support developing countries' own efforts to integrate
in the world trading system and to take advantage of opportunities. As part of  this,
the  Community  has  worked  to  strengthen  and  make  more  precise,  effective  and
operational  the  Special  and  Differential  Treatment  provisions  that  apply  to
developing  countries in the  WTO  context,  including  facilitating  accession  by  Least
Developed  Countries.  Agreement  was  reached  on  this  point  by  the  WTO  General
Council in December 2002, translating into action the initiative launched by the EU
in 1999, taken up in turn by the Third UN Conference on Least Developed Countries

52

http://www.wto.org/english/tratop_e/dda_e/dda_e.htm

49

                                                
in  Brussels  in  May  2001.  As  part  of  the  Doha  process,  the  Community  has  also
tabled in the WTO proposals for further liberalisation of trade in goods and services
by itself and others and for improving and strengthening the rules of the WTO. These
negotiations are due to be finalised in 2004.

In  September  2002  the  Commission  adopted  its  Communication  'Trade  and
Development: assisting developing countries to benefit from trade'53, which sets out
the importance of the relationship between development, trade and the integration of
developing countries into the world economy. The Communication was endorsed by
the General Affairs and External Relations Council Conclusions in November54 and
includes proposals, ranging from measures aimed at improving the delivery of trade
related assistance in key areas to ideas for better co-ordination and policy coherence
within  the  EU  and  with  international  organisations.  Overall,  the  measures  should
help  developing  countries,  and  in  particular  the  least  developed  countries,  acquire
institutional  regulatory  capacity,  and  the  expertise  to  deal  with  the  challenges  of
trading in a global system. At the same time, the Commission stresses the importance
for  developing  countries  to  improve  the  investment  climate  for  the  business  sector
and to ensure poor people can fully benefit from trade.

One  high  profile  trade  and  development  issue  that  the  Commission  has  tackled
during 2002 has been how to facilitate access to essential medicines for developing
countries. Increasing affordability and access is an essential part of the Community’s
Programme  for  Action  on  Communicable  Diseases  (as  explained  in  the  section  on
HIV/AIDS  and  other  communicable  diseases  in  the  Mainstreaming  chapter  of  this
report). A deal reached at the WTO Ministerial in Doha in November 2001 enables
developing  countries  facing  serious  problems  to  invoke  a  compulsory  licence  to
produce  essential  medicines,  but  does  not  help  those  that  lack  their  own
pharmaceutical manufacturing capacity. The Commission has worked to try to broker
a  deal  to  improve  access  for  these  countries  to  imported  generic  medicines
manufactured  under  compulsory  licences  in  other  countries.  The  Commission
submitted  an  options  paper  to  the  March  2002  WTO  Council  on  Trade  Related
Intellectual Property  Rights  (TRIPs)  and  a  new  communication to the  WTO with a
detailed  proposal  in  June.  To  facilitate  and  reinforce  these  WTO  discussions,  the
Commission published a working document in April 2002 setting out a strategy for
tiered pricing55and, in October, a proposal for a Council Regulation to prevent trade
diversion into the EU market of pharmaceuticals sold at tiered prices in developing
countries56.  The  Commission  was  disappointed  that,  by  the  end  of  2002,  WTO
members  had  not  been  able  to  agree  a  solution  for  developing  countries  without
manufacturing capacities and will continue to give this issue attention as a priority in
2003.

3.3.2.

Regional Integration and Cooperation

The  Community  is  the  main  provider  of  assistance  for  regional  integration  and
cooperation,  consistent  with  its  strong  belief  in  the  benefits  of  regional  integration
both for itself and others. Over the past few  years, there has been a gradual shift in
the Community’s support for what is known as ‘functional regional cooperation’ in

53

54

55

56

COM(2002) 513
Council Conclusions on Trade and Development, Reference 14184/02, 19 Nov 2002
http://europa.eu.int/comm/trade/pdf/med_wd.pdf
COM(2002) 592

50

                                                
several areas such as transport infrastructure,  animal disease control and agronomic
research  to  support  for  regional  integration  processes.  The  Community  is  still
providing  support  for  many  of  these  types  of  functional  initiatives  but  this  is  now
handled  in  the  context  of  regional  integration  processes,  which  facilitates  a  more
strategic  approach.  Attention  to  regional  integration  issues  was  a  key  part  of  the
preparation of regional and country strategy papers during 2002.

The Community’s approach recognises that trade policy is  a key  aspect  of regional
integration  initiatives  and  that  successful  regional  integration  contributes  to  the
multilateral trading system. EU support in the trade and regional integration areas is
fully  complementary  and  mutually  reinforcing.  The  close  linkage  between  trade-
related assistance particularly  in  the context of  the Doha Development Agenda and
regional  integration  was  underlined  in  the  Commission’s  Trade  and  Development
Communication57. This Communication advocated a  ‘South-South-North’ approach,
whereby  regional  groupings  of  developing  countries  would  negotiate  with  the  EU
rather  than  individual  countries.  This  approach  is  at  the  heart  of  the  Economic
Partnership  Agreements  (EPAs)  that  are  being  negotiated  between  the  EU  and
Africa, Caribbean and Pacific countries, and is also present with Mercosur and in the
Barcelona Process between the EU and MEDA countries. The close relation between
trade  and  regional  integration  has  been  reflected  in  the  Guidelines  for  Regional
Programming that were adopted early in 2002.

3.3.3. Macroeconomic Policies and Equitable Access to Social Services, including Health

and Education

3.3.3.1 Macro-economic and Poverty Reduction Budget support

Macroeconomic policies potentially play a key role in creating the pro-poor growth
essential for the reduction of poverty. However, in the past adjustment programmes
have not necessarily led to this end. Since the early 1990s the Commission has led a
group  of  international  donors  piloting  in  Burkina  Faso  new  approaches  to  the
provision  of  budget  support.  Since  the  early  findings  of  the  pilot  emerged,
confirming  the  importance  of  a  greater  focus  on  the  outcomes  of  policies,  the
Commission  has  led  the  way  in  adapting  its  budget  support  operations  (which  still
have  a  DAC  classification  of  “structural  adjustment  support”)  to  link  them  more
effectively to results. General budget support tackles key problems: transaction costs;
government accountability to its national stakeholders, in particular Parliament; and
government ability to  develop  coherent  planning and comprehensive budgeting. By
making use of national systems, in the context of close Commission involvement in
assessment of and support for public financial management, it helps to improve those
systems – for donor aid and domestic resources alike.

The Commission’s approach to budget support (so far, in ACP countries) has taken
forward a results-oriented methodology. For low-income countries, budget support is
provided  to  enable  the  government  to  implement  its  Poverty  Reduction  Strategy
Paper  (PRSP),  while  for  other  countries  it  aims  to  support  equivalent  national
strategies.  In  addition,  the  Commission  has  developed  its  methodology  of  linking
disbursements to results. In most such operations, some funds are provided in “fixed”
tranches,  provided  that  macro-economic  management  remains  sound  and  there  is

57

COM(2002) 513

51

                                                
acceptable  progress  with  improvements  in  public  financial  management.  The
remainder  is  provided  in  “variable”  tranches,  whose  value  is  determined  by  the
progress  made  by  the  government  in  achieving  agreed  outcomes  in  poverty
reduction. These targets, which are drawn wherever possible from the indicators in a
PRSP, are usually related to outcomes in education and health. In addition, amounts
provided may be linked to the degree of achievement of targets for public financial
management, such as the funding of key basic services. Linking funding to outcomes
at  this  level,  rather  than  imposing  conditions  on  what  governments  should  do  to
achieve them, leaves greater scope  for  national ownership of policies,  and removes
donors  from  micro-managing  aspects  of  national  policy.  It  also  helps  to  give  such
outcome  targets  political  prominence  within  developing  countries,  enhancing  the
accountability of governments to their citizens for the quality of services delivered.

By  the  end  of  2002,  this  approach  had  only  been  fully  implemented  in  6  countries
(more  have  such  disbursements  programmed  for  2003).  It  is  therefore  too  soon  to
draw  conclusions  about  the  impact  of  this  form  of  support.  However,  the
Commission  has  been working with other donors,  notably  Member  States  active  in
this area, in developing methodologies to assess the impact of budget support more
generally. Working groups have been established bringing together experts from the
Commission  and  Member  States  to  look  more  closely  at  the  relationship  between
macroeconomic  support  and  outcomes  in  social  sectors,  in  particular  on  health  and
education.  Progress  has  been  made  within  the  EU  towards  a  common  approach  on
education and health indicators.

The overall aim of this approach is to focus government attention, and accountability
to their citizens, on the basic services actually delivered Combined with attention to
the  levels  of  funding  actually  provided  to  basic  social  services,  this  provides
governments with the  incentive to deliver the services,  with additional resources to
improve  delivery,  and  with  monitoring  and  assistance  in  directing  resources  to  the
basic services in question.

In  order  to  further  increase  the  efficiency  and  effectiveness  of  this  approach,  the
Commission has sought to promote close integration between macroeconomic budget
support  and  sector  processes  in  education  and  health.  This  has  included  careful
liaison  with  information  management  systems  in  these  sectors.  In  addition,  for
countries concerned, the Commission has sought to help countries to ensure that their
PRSPs  fully  integrate  the  work  being  done  at  sectoral  level  with  the  overview
provided  by  the  PRSP.  The  Commission  has  also  been  playing  an  active  role  in
bringing together donors involved in providing budget support, thus reducing further
the  transaction  costs  associated  with  dealing  with  large  numbers  of  donors.  The
Commission  has  pioneered  the  notion  of  the  ‘Poverty  Reduction  Strategy  cycle’,
which  seeks  to  embed  the  PRSP  in  national  calendars  for  the  budget  and  other
planning  cycles  and  seeks  to  persuade  donors  to  use  countries’  PRSP  Annual
Reviews as the source of all information for budget support disbursement needs.

3.3.4.

Education

3.3.4.1 Progress Towards Education-Related MDGs

The  three  education  indicators  selected  in  the  core  set  track  improvements  in  the
percentage  of  school  age  children  who  enrol  in  primary  education;  the  percentage
that complete this; and the ratio of girls to boys attending school (the gender rate).

52

Net enrolment rates (NER) have improved significantly in the past 5 years in  Latin
America and even more so in the Caribbean, but dropped slightly in Africa, Asia and
the Mediterranean. The situation is particularly bad in Africa where the rate remains
at about 50%, compared to about 90% in other parts of the world. All but one of the
countries  in  the  list  of  those  with  the  lowest  NER  (see  table  below  “Developing
countries  with  lowest  net  enrolment  rate”)  is  African.  The  fact  that  neither  the
Democratic Republic of Congo nor Sudan are currently amongst the bad performers
as far as the Primary Completion Rate is concerned, shows how much the situation in
these  countries  has  worsened  in  recent  years:  low  NER  rates  will  eventually  feed
through  into  low  PCR  rates.  One  African  country,  Uganda,  has  the  top  score
regarding  net  enrolment  rate  (NER).  This  demonstrates  that  clear  will  backed  by
sound  policies  can  make  a  genuine  difference.  Over  time,  this  will  have  a  positive
impact on Uganda’s primary completion rate (PCR). In the Balkans region, the NER
in the Federal Republic of Yugoslavia and Croatia has dropped significantly.

Developing countries with highest net enrolment rate

Country

Region

Income classification Most recent year

Uganda

Argentina

Peru

Belize

Mexico

Malaysia

Philippines

Albania

Maldives

Fiji

Cuba

Africa

Latin America

Latin America

Caribbean

Latin America

Asia

Asia

Balkans

Asia

Pacific

Caribbean

LDCs

UMICS

LMICs

LMICs

UMICS

UMICs

LMICs

LMICs

LDCs

LMICs

LMICs

109

106

104

104

103

101

101

100

100

99

99

53

Developing countries with lowest net enrolment rate

Country

Region

Income classification

Most recent year

Bhutan

Niger

Angola

Djibouti

Ethiopia

Congo, Dem. Rep.

Burkina Faso

Eritrea

Mali

Burundi

Sudan

Tanzania

Asia

Africa

Africa

Africa

Africa

Africa

Africa

Africa

Africa

Africa

Africa

Africa

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

15

21

27

31

31

33

35

40

43

44

45

47

The primary completion rate (PCR) is generally  considered a  good indicator of  the
quality of an education system, since quality is often a key factor in whether children
stay in school or not. The PCR has improved in all regions, albeit at different paces.
Progress  has  been  most  spectacular  in  Latin  America  and,  to  a  lesser  extent,  the
Caribbean  (which  is  still  below  60%  but  improving).  Conversely,  the  situation
evolved  only  slowly  in  Africa  and  Asia.  Africa  lags  behind  by  far,  with  a  PCR  of
around 50% (compared to 80% in most other parts of the world). The fact that two
African countries (Cap Verde and Zimbabwe) top the primary completion rate league
table contrasts sharply with the stagnation elsewhere (such as Chad at 19%), or even
worse  deterioration  (e.g.  the  Central  African  Republic  from  28%  to  19%).
Afghanistan is at the bottom of the country list overall, with a very low 8% PCR (this
figure will hopefully improve over the next few years).

Developing countries with highest primary completion rate

Income classification Most recent year

Country

Cape Verde

Zimbabwe

Azerbaijan

Region

Africa

Africa

East.Eur. & Cent.Asia

Egypt, Arab Rep.

South Med & N.& M.East

South Africa

St. Lucia

Yugoslavia, Fed. Rep.

Africa

Caribbean

Balkans

Chile

Latin America

Iran, Islamic Rep.

South Med & N.& M.East

LDCs

Other LICs

Other LICs

LMICs

LMICs

UMICs

LMICs

UMICs

LMICs

Indonesia

Asia

Other LICs

54

117

113

101

99

98

97

96

92

92

91

Developing countries with lowest primary completion rate

Country

Region

Income classification Most recent year

Afghanistan

Central African Republic

Chad

Niger

Bhutan

Mali

Ethiopia

Burkina Faso

Madagascar

Djibouti

Asia

Africa

Africa

Africa

Asia

Africa

Africa

Africa

Africa

Africa

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

8

19

19

20

23

23

24

25

27

28

Over  the  past  five  years,  the  gender  rate  has  stagnated  in  most  parts  of  the  world.
However, there has been limited progress in Asia (5%) and to a lesser extent Africa
(2.5%). Overall there remains a significant gap between Africa, Asia and the Pacific
(where  the  rate  is  around  80-85%)  and  the  rest  of  the  world  (where  it  is  close  to
100%). The data points to a clear link between development and girls’ attendance of
school since, in the more developed regions, the ratio is closer to 100. The high rates
from  South  Africa  and  some  neighbouring  countries  (Botswana,  Namibia  and
Lesotho)  stand  out,  with  a  higher  proportion  of  girls  than  boys  attending  school.
However,  this  is  not  necessarily  an  indication  of  an  efficient  school  system:  for
instance, the net enrolment rate in Lesotho is only 58%. In most other cases, there is
a  correlation  between  the  countries  with  few  girls  in  school  and  a  low  enrolment
ratio. Among the few children that go to school in Afghanistan there are significantly
less girls than boys.

Developing countries with lowest gender rate

Country

Afghanistan

Yemen, Rep.

Chad

Guinea

Benin

Ethiopia

Niger

Burkina Faso

Mali

Togo

Equatorial Guinea

Côte d'Ivoire

Nepal

Djibouti

Region

Asia

South Med & N.& M.East

Africa

Africa

Africa

Africa

Africa

Africa

Africa

Africa

Africa

Africa

Asia

Africa

55

Income classification Most recent year

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

LDCs

Other LICs

LDCs

LDCs

43

47

53

56

61

61

64

66

66

67

68

69

69

70

Developing countries with the highest gender rate

Country

Region

Income classification Most recent year

East.Eur. & Cent.Asia

Other LICs

Mongolia

Lesotho

Uruguay

Grenada

Dominican Republic

Namibia

Botswana

St. Lucia

South Africa

Colombia

Kiribati

Africa

Latin America

Caribbean

Caribbean

Africa

Africa

Caribbean

Africa

Latin America

Pacific

LDCs

UMICS

UMICs

LMICs

LMICs

UMICs

UMICs

LMICs

LMICs

LDCs

UMICs

116

112

108

107

103

103

102

102

102

101

101

101

Venezuela, RB

Latin America

3.3.4.2 EC Policy in Support of the Education Sector

On 6 March 2002, the Commission adopted a new Communication on Education and
training  in  the  context  of  poverty  reduction58.  The  main  policy  priorities  of  the
Commission are basic education, vocational training, and support to higher education
mainly  at  the  regional  level.  Important  crosscutting  issues  were  introduced  such  as
gender  equality,  the  link  between  education  and  the  fight  against  HIV/AIDS  and
education in conflict situations. Harmonisation of procedures among EU donors and
promotion of sector wide approaches were indicated as the preferred methods. On 30
May 2002, the Council adopted a Resolution that endorsed these policy lines59. The
European  Parliament  adopted  its  own  conclusions  in  May  2003.  With  this,  the
European  Community  now  has  a  clear  and  reinforced  education  policy  focused  on
poverty reduction and efficient implementation.

The European Community also strongly supports the Education Fast Track Initiative
(FTI)  which  it  views  as  a  means  to  accelerate  progress  towards  Education  for  All
(EFA). The FTI focuses on an initial target of 23 low-income countries with sound
policies but unlikely to achieve the Millennium Development Goals (MDGs) in the
field  of  education;  i.e;  universal  primary  completion  by  2015,  in  the  absence  of
additional  donor  support.  The  FTI  aims  at  implementing  a  partnership  between
donors and partner countries, or where it exists consolidating such partnership. The
partnership  itself  rests  on  two  complementary  lines  of  action.  First  incremental
through  concrete  measures
strengthening  of  co-operation  amongst  donors 
(coordination  group,  common  funding,  silent  partnerships,  more  sector-wide
programmes  etc.)  in  order  to  cut  costs,  increase  efficiency  of  support  and  simplify
procedures for partner countries. Second, allocations of additional funds to meet the
financial  needs  of  partner  countries  to  reach  the  education  MDGs.  So  far,  10
countries of the initial group of 23 have had their pogrammes endorsed under the FTI
process, and donors have committed funds to these programmes.

58

59

COM(2002) 116
Development Council Conclusions, 30 May 2002. Ref 8958/02

56

                                                
3.3.4.3 Progress towards Health-Related MDGs

The core indicators in this area are: mortality rates  for children  under five  (rates in
developed  countries  are  generally  below  10  per  1000  but  rates  in  developing
countries  are  often  much  higher);  measles  immunisation;  HIV  prevalence  amongst
pregnant women; and supervised deliveries (which is critical to improving maternal
mortality rates).

Under-Five Mortality: Except for the first few weeks of life, the immediate cause of
most  deaths  in  children  under  five  are  communicable  diseases  (e.g.  pneumonia,
malaria, diarrhoea and HIV/AIDS). The occurrence and severity of these diseases is
due to a wide variety of factors, including malnutrition – in turn due to lack of food,
poor  housing,  poor  water  supplies,  poor  hygiene,  low  level  of  education  of  the
mother  and  lack  access  to  adequate  health  care.  Under  five  mortality  has  declined
markedly since the 1960s throughout the world, including during the 1990s. Progress
has been particularly impressive in Asia and, if current trends continue, many Asian
countries  should  meet  the  MDG  goal  of  a  two-thirds  reduction  by  2015.
Notwithstanding this progress, in ten countries more than one in every five children
born  does  not  reach  their  fifth  birthday  (seven  of  these  were  affected  by  serious
internal conflict during the 1990s).  On the other hand,  some of the  world’s poorest
developing  countries  have  demonstrated  that  it  is  possible  to  bring  about  dramatic
reductions in under five mortality. For  example, Bangladesh has shown remarkable
progress  in  reducing  under  five  mortality  from  144  in  1990  to  82  in  2000.  While
some  of  this  may  be  attributed  to  an  increase  in  income,  it  mostly  reflects  the
effectiveness  of  placing  special  emphasis  on  basic 
interventions  such  as
immunisation,  oral  rehydration  for  diarrhoea,  treatment  of  pneumonia,  improved
sanitation and better access to safe water. Improved female education and expanded
microcredit  for  women  have  also  been  important.  Rates  of  malnutrition  in
Bangladesh have improved too, although they remain very high by global standards.
Every  effort  must  be  made  to  sustain  the  gains  achieved  in  the  1990s.  Worsening
under  five  mortality  rates  in  several  countries  since  1990  have  shown  that  the
achievements of the past forty years can be easily reversed. Apart from Iraq, which is
clearly  a  special  case,  the  worst  reversals  have  been  seen  in  Eastern  and  Southern
Africa. Undoubtedly the main factor responsible has been the increasing number of
childhood deaths due to HIV/AIDS in these countries (see below).

Countries with under five mortality rates
above 200 per 1000 live births in the year 2000

Country

Under 5 mortality rate

Sierra Leone
Angola
Niger
Afghanistan
Liberia
Mali
Somalia
Guinea-Bissau
Congo, Dem. Rep.
Zambia

316
295
270
257
235
233
225
215
207
202

57

Countries with the steepest decline in under five mortality
between 1990 and 2000

Country

Under 5 mortality rate

Egypt

Malaysia

Indonesia

Tunisia

Morocco

Ecuador

Bangladesh

Turkey

Chile

Bhutan

1990

104

21

91

52

85

57

144

78

20

166

2000

43

9

48

28

46

32

82

45

12

100

Decrease
1990-2000

59%

57%

47%

46%

46%

44%

43%

42%

40%

40%

Countries with the greatest increases in under five mortality
between 1990 and 2000

Country

Under 5 mortality rate

1990

2000

Iraq

Botswana

Zimbabwe

Swaziland

Kenya

Algeria

Cambodia

South Africa

Kazakhstan

Côte d'Ivoire

Cameroon

50

58

80

110

97

53

115

60

67

155

139

130

101

117

142

120

65

135

70

75

173

154

Increase
1990-2000

160%

74%

46%

29%

24%

23%

17%

17%

12%

12%

11%

Measles  Immunisation:  Immunisation  is  an  important  intervention  for  improving
child  survival  and  provision  should  be  a  basic  priority  for  every  national  health
service.  It  is  cheap  but  very  effective:  it  costs  less  than  €1  to  immunise  a  child
against  measles.  Before  1980,  measles  epidemics  regularly  devastated  young
children  in  developing  countries  but,  following  the  introduction  of  the  expanded
programme  on  immunisation,  the  incidence  has  declined  steadily  and  death  rates
faster still. Despite this success, measles still accounts for around 800,000 deaths per
year60.  Progress  in  increasing  coverage  has  been  especially  good  in  Latin  America

60

WHO estimate.

58

                                                
with  measles  deaths  have  been  reduced  by  99%61.  Forty  developing  countries  had
measles  immunisation  rates  of  90%  or  higher  in  1999.  However,  sustaining  good
coverage can prove difficult: a new cohort of babies has to be immunised every year.
Falling rates in Asia are due to a decline in coverage in several countries, including
China and India. 25 African countries recorded a decline in coverage between 1995
and 1999. In Nigeria, coverage fell throughout the last decade, dropping from 85% in
1990  to  41%  in  1999.  Falling  coverage  rates  are  very  serious:  as  the  number  of
children  with  no  immunity  increases  a  serious  epidemic  becomes  inevitable.
UNICEF  and  WHO  have  included  countries  with  measles  immunisation  coverage
rates below 50% (except North Korea) in a list of 45 priority countries where deaths
from  measles  are  most  prevalent  and  where  efforts  to  boost  coverage  will  be
concentrated.

Countries with measles immunisation coverage rates
below 50% in 1999

Country

Percentage

Congo, Dem. Rep.

Djibouti

Congo, Rep.

Equatorial Guinea

Somalia

Ethiopia

Chad

Korea Dem. Rep.

Niger

Central African Republic

Afghanistan

Nigeria

Togo

Angola

15

21

23

24

26

27

30

34

36

39

40

41

43

46

HIV  Prevalence  in  Pregnant  Women:  HIV/AIDS  and  malaria  are  singled  out  for
special focus in the Millennium Development Goals. Progress towards the target “to
halt and begin to reverse the spread of HIV/AIDS” will be monitored by changes in
the  prevalence  of  HIV  infection  in  pregnant  women.  During  the  1990s,  HIV
prevalence rose steeply in many parts  of the world,  but  particularly  in  sub-Saharan
Africa  where  at  least  13  countries  now  have  prevalence  rates  above  10%.  HIV
prevalence rates are also increasing rapidly in parts of Asia and Eastern Europe.

The  impact of  HIV/AIDS  on  under-five  mortality  has  already  been  noted  above.  It
has  caused  an  unprecedented  drop  in  life  expectancy.  It  may  also  be  partly
responsible for the increase in maternal mortality observed in some countries. While
the overall picture is very gloomy, there have been a few successes. Best known is
Uganda,  where  the  HIV  prevalence  rate  in  pregnant  women  has  been  falling  since
1992, from a peak of 29.5% in 1992 to 11.3% in 2000 (amongst the 15-24 age group,

61

UNICEF data.

59

                                                
the  prevalence  rate  is  lower  still  at  7.8%).  More  recently,  UNAIDS  has  reported
evidence of falling rates of HIV infection amongst pregnant women under 20  years
old in Zambia.

Countries with HIV prevalence above 10% in pregnant women
aged 15-24 years

Country

Botswana
Lesotho
South Africa
Zimbabwe
Namibia
Zambia
Malawi
Mozambique
Central African Republic
Kenya
Ethiopia
Burundi
Rwanda

HIV prevalence (%)
34
26
25
25
20
18
15
15
14
13
12
12
11

Supervised Deliveries: Maternal mortality rates in developing countries are as much
as 200 times greater than those in the developed world, reflecting  above all lack of
access  to  basic  maternity  care  –  particularly  at  the  time  of  delivery.  The  main
strategy  for  achieving  the  Millennium  Development  Goal  of  a  three-quarters
reduction  in  maternal  mortality  by  2015  is  through  increasing  the  number  of
deliveries undertaken by trained personnel, such as a midwife or doctor, and not by
traditional  midwives  (programmes  aimed  at  improving  the  skills  of  traditional
midwives have not had a positive impact on maternal mortality). The data available
on this indicator is limited, and it is difficult to discern any meaningful trends in the
different regions. Rates are generally lowest in the world’s least developed countries.
Some  countries  have  demonstrated  good  progress  during  the  1990s,  but  generally
there is still a long way to go in most regions – especially Africa and Asia.

Countries with lowest rates of supervised deliveries
(most recent data available)

Country

Percentage of
supervised deliveries

Nepal
Chad
Bangladesh
Niger
Eritrea
Yemen, Rep.
Mali
Burkina Faso
Cambodia
Guinea
Tanzania

10
11
14
18
21
22
24
27
31
35
35

60

3.3.4.4 EC policy in support of Health, AIDS and Population

The  impact  of  the  Commission's  ambitious  target  to  increasingly  prioritise  in-
country/regional  allocations  for  improved  'health'  outcomes,  in  partnership  with
developing countries and other partners, will take time to show. At the policy level,
however, a number of results have been achieved during 2002.

In March 2002 the Commission adopted a Communication on Health and Poverty62.
The Communication represents one single EC policy framework to guide investment
in  health,  AIDS  and  population  for  attainment  of  the  Millennium  Development
Goals. The framework has four strands: i) to  improve health, AIDS and population
outcomes  at  country  level,  especially  among  the  poorest;  ii)  to  maximise  health
benefits  and  minimise  potential  negative  health  effects  of  EC  support  for  other
sectors; iii) to protect the most vulnerable from poverty through support for equitable
and  fair  health  financing  mechanisms;  and  iv)  to  invest  in  the  development  of
specific global public goods.

Subsequently  a  Council  resolution  on  Health  and  Poverty  was  adopted  on
30 May 2002.63 This referred to increasing the volume and improving the delivery of
aid.  It  stated:  […]  in  view  of  reaching  better  health  outcomes  and  attaining  the
internationally agreed health development goals, the EU will strongly support those
developing  countries  who  agree  to  work  towards  the  targets  set  by  themselves  for
investments in health, such as in Abuja  (15%  of national budgets) […] and […] In
this context, the Council recalls its conclusions on the UN Conference on Financing
for  Development  in  Monterrey,  agreed  by  Foreign  Ministers  on  14  March  and
endorsed  by  the  European  Council  in  Barcelona  whereby  the  Member  States
collectively commit themselves, as a first significant step, to increasing their overall
ODA volume in the next four years. A substantial share of that increase should go to
support  for  social  development  in  developing  countries  with  special  emphasis  on
improving  health  and  education  outcomes.  […]  Discussions  in  the  European
Parliament on the Health  and  Poverty  Communication  started  in  October  2002  and
remain in progress.

The  EC  Programme  for  Action  (PfA)  on  accelerated  action  against  AIDS,
tuberculosis  and  malaria64  remains  a  comprehensive,  forward-looking  and  coherent
EU  policy  framework  making  a significant  contribution  towards  improved  country,
regional  and  global  action  against  the  three  major  communicable  diseases.  The
Commission  has  now  developed  a  new  Communication  outlining  progress  in
implementation  of  the  PfA,  and  this  should  be  adopted  in  early  2003.  As  this  will
show, the Commission has worked on a number of fronts to achieve the objective of
‘increasing  affordability’,  including  efforts  in  the  context  of  the  multilateral  World
Trade Organisation discussions on Trade Related Intellectual Property Rights and the
Commission’s strategy towards tiered pricing (see ‘Trade and Development’ above).
In  terms  of  ‘increasing  investment  in  research  and  development’,  substantial
resources  have  been  allocated  from  the  Research  Framework  Programmes  for
HIV/AIDS,  malaria  and  TB  research,  including  the  establishment  of  the  new
European  and  Developing  countries  Clinical  Trials  Partnership  (EDCTP).  The

62

63

64

COM(2002) 129
Health and Poverty - Resolution of the Council and the Representatives of the Governments of Member
States. Development Council Conclusions, 30 May 2002. Ref. 8958/0
COM(2001) 96 of February 2001

61

                                                
overall  goal of  the EDCTP  is to accelerate the  development  and  evaluation  of  new
vaccines,  drugs,  and  other  preventive  or  therapeutic  tools  against  HIV/AIDS,
malariand TB. It will have a target budget of € 600 million. One third of the budget
will  be  contributed  by  the  Community,  whereas  another  €  200  million  will  be
provided by Member States and Norway with an additional € 200 million expected
from  the  private  sector,  R&D  industry,  foundations  and  charities,  and  Community
development funds (EDF or special budget line).

The  EDCTP  is  expected  to  be  operational  during  the  second  half  of  2003.  In  line
with  the  Doha  declaration,  the  developing  countries  should  have  access  to  the
products  developed  by  the  EDCTP.  A  carefully  balanced  management  structure
ensures that the developing  countries are  important stakeholders and  equal partners
in  strategic  decisions.  In  line  with  this,  African  partners  will  both  participate  in
prioritising  new  interventions  and  in  the  development  of  strategic  clinical  trials
action plans.

Where  progress  with  the  PfA  has  been  less  visible,  this  was  due  to  a  lack  of
appropriate  resources,  in  particular  in-country  resources,  within  the  Commission
and/or the Member States to take forward large-scale programmes in specific areas.
For  example,  local  manufacturing  capacity,  technology  transfer,  social  marketing
partnerships  with  civil  society,  innovative  research  and  development,  and  working
through true partnerships with the developing countries concerned. In this regard, the
EDCTP  clearly  constitutes  a  pilot  programme  and  a  new  step  forward  as  it
contributres  to  a  unified  voice  to  represent  European  research  contributions  in  the
fight against the three diseases in developing countries. Additional direct and indirect
incentives for research and development of specific global public goods to fight the
three diseases require primary focus in the coming years. All PfA actions are directly
or  indirectly  linked  to  other  Community  policies  and  actions,  in  particular  Trade,
Research and Development for improved health, AIDS and population outcomes in
developing countries.

Although  authoritative  economic  research  has  been  focusing  on  relationships
between  local  conditions  of  poverty  and  global  communicable  diseases  such  as
malaria, tubercolosis and HIV, the relationship between local poverty dominance and
locally highly prevalent vector-borne  and  other communicable  diseases  is also  well
known.  In this respect, DG RTD  has  been  promoting  research  and  new  knowledge
and  technologies  against  infectious  burdens  represented  by  schistosomoiasis,
filariasis, Chagas disease etc. and other neglected communicable diseases. Work on a
vaccine against chilhood pneumonia, by far the largest killer in Asia, is far advanced
and entering final population trials.

Research on  reproductive health was  expanded as well through  collaborative North
South projects.

At the end of 2001 Programming Guidelines for Health, AIDS and Population were
shared  with  Commission  Delegations.  All  EC  Country  Strategy  Papers/National
Indicative  Programmes  (except  for  the  'non-notified  ACP  countries')  were  finalised
by  the  end  of  2002.  The  2002  level  of  allocations  for  'health  as  a  focal  sector'
programmed under the 9th EDF is 3.7% (€ 280 million). 22.3% from the 9th EDF (€
1.6  billion)  is  programmed  for  'macro-economic  support  with  social  development
conditionality’. During 2002, regional and intra-ACP  funds  have been programmed
for  'health'  in  ACP  countries  from  the  6th  -  9th  EDF  (€  104  million  in  total:  €  60

62

million for the GFATM from the 6th and 7th EDF and € 44 million for reproductive
health / malaria from the 8th and 9th EDF). Additional funding from the 9th EDF intra-
ACP regional funds and from 9th EDF reserves is currently being discussed with the
ACP  countries.  MEDA  programming  for  ‘health’  for  2002-2004  represents  2%  of
available  resources,  in  Asia  (2002-2004)  14.1%  and  in  Latin  America  (2002-2006)
1.9%.  The  2002  multi-annual  provisions  for  all  developing  countries  total  €  423.2
million  for  ‘health  and  population’,  less  than  3.3%  of  total  EC  development  aid
programming.

Health is one  of  the sectors where the Commission  is  pursuing a more coordinated
approach with Member States as part of its in-country pilot exercises (see the section
on the Three Cs). The Commission’s initiatives in favour of increased of untying of
Community aid (described in the same section) also include a  focus  on health.  The
Commission  has  proposed  to  use  medicines  and  supplies/products  for  HIV/AIDS,
malaria and TB as a pilot exercise. The first EC dossier to benefit from untying was
an international tender for provision of drugs and medical supplies in Zimbabwe.

3.3.6.

Transport

The  results  of  the  programming  process  carried  out  in  2002  confirm  that  transport
remains one of the main areas of Community support, in particular in the ACP region
where  transport  represents  31%  of  programmed  resources  under  the  9th  European
Development  Fund  (as  detailed  in  that  regional  chapter).  This  focus  partly  reflects
the fact that many other donors (particularly bilaterals) have largely withdrawn from
transport,  and  builds  on  the  Community’s  long  experience  and  comparative
advantage in this sector.

Sustainable transport systems can play a crucial role in promoting poverty reduction
and  development,  by  facilitating  the  mobility  of  the  poor  and  providing  physical
access  to  jobs,  health  and  education.  Appropriate  access  is  essential  for  economic
growth  and  trade,  and  fosters  integration.  Achieving  these  development  goals
requires  that  transport  should  meet  stakeholder  needs,  be  safe,  affordable  and
efficient,  and  have  minimal  impact  on  the  environment.  To  deliver  sustainable
transport, partner countries need to adopt a sectoral approach that integrates sectoral
and  crosscutting  issues.  Such  an  approach  must  build  economic,  financial  and
institutional  sustainability  as  well  as  being  environmentally  sound  and  socially
aware.

Programming in the transport sector during 2002 has been guided by the “Transport
Programming Guidelines” as well as the Commission’s Communication “Promoting
sustainable  transport  in  development  cooperation65.”  In  the  future,  the  Commission
will be strengthening its support to its Delegations to help ensure that sound policies
and sustainable strategies are pursued through country sector programmes as well as
developing guidelines for the upcoming mid-term Review of Indicative Programmes.
The Commission will also draw on the results of the second independent evaluation
of EC interventions in the transport sector launched in mid-2002 (see the section in
this  report  on  Monitoring  and  Evaluation).  This  covers  all  geographical  regions  of
Community  development  cooperation  (unlike  the  first  sector  evaluation  in  1993-94

65

COM(2000) 422

63

                                                
which  covered  only  the  ACP  countries).  The  outcome  of  the  preparatory  phase
highlights the past and present focus on the ACP region, which is likely to continue.

Policy  and  strategy  coordination  with  EU  Member  States  remains  an  essential
element  of  the  Community’s  sectoral  dialogue  for  ensuing  coherence  and
complementarity  of  EC  interventions.  In  2002  the  Commission  increased  its
coordination  with  the  transport  experts’  group  by  organising  two  meetings.  These
discussions resulted in agreement on the indicators for assessing the performance of
the  transport  sector  and  its  impact  on  users  and  beneficiaries  of  transport  services.
The  meetings  also  paved  the  way  for  developing  a  simple  methodology  for
improving  the  monitoring  of  indicators  as  well  as  examining  the  options  for
providing  some  EC  finance  through  budget  support  mechanism  in  transport  sector
programmes.

During  2002, the Commission  also participated actively  in  the  re-orientation  of  the
Sub  Saharan  Africa  Transport  Policy  Programme  (SSATP),  which  brings  together
several EU Member States, the UN Economic Commission for Africa (UNECA), the
World Bank and Norway as well as 30 African countries. The Commission raised its
visibility  and  contribution  to  the  Programme  by  its  direct  representation  on  the
SSATP  Board,  increased  involvement  in  planning  of  its  long-term  development  as
well as reaching agreement, in principle, to provide core funding to the Programme.
These  coordinated  interventions  will  lay  the  foundations  for  allowing  SSATP  to
facilitate  processes  that  ensure  transport  policies  and  strategies  are  fully  integrated
into  poverty  reduction  strategies  and  plans.  At  a  regional  level  SSATP  will,  by
working through Regional Economic Communities, facilitate transport strategies that
better contribute to regional integration and intra- and international trade.

3.3.7.

Food Security and Sustainable Rural Development

3.3.7.1 Progress towards related MDGs

Underweight Children: Lack of food remains a scourge for poor families in most of
the  developing  world.  This  has  been  highlighted  in  the  MDGs,  which  include  a
commitment to halve the proportion of people who suffer from hunger by 2015. This
will be monitored chiefly by changes in the prevalence of children under five that are
underweight  for  their  age.  Malnutrition  not  only  predisposes  the  child  to
communicable  diseases,  but  it  also  affects  subsequent  growth  and  development,
retarding  adult  intellectual  capability.  Thus  poor  nutrition  in  childhood  helps  to
perpetuate the cycle of poverty.

Good data is not available on all countries, but what information there is shows that
progress has been made in all regions since 1995, but that current rates are not fast
enough  to  reach  the  2015  target.  Rates  of  malnutrition  are  particularly  high  in  a
number of countries in Asia, which has 8 of the 14 countries with the highest rates of
malnutrition worldwide.

64

Countries where at least 40% of children
are underweight for age

Niger
Lao PDR

Mali

Maldives

Eritrea

Burundi

Cambodia

Yemen

Ethiopia

India

Nepal

Afghanistan

Bangladesh

Korea Dem. Rep. (North)

3.3.7.2 Food Security

40
40

43

43

44

45

46

46

47

47

47

48

48

60

Food security has been a major issue during 2002, in particular because of the serious
food  situations  in  several  developing  countries  –  including  Afghanistan,  Southern
Africa  and,  towards  the  end  of  the  year,  the  Horn  of  Africa.  The  Community  has
worked  closely  with  others  to  ensure  an  effective  response  to  the  food  crises  (the
Commission’s efforts regarding the crises in Africa are outlined in the ACP regional
chapter later in this report).

Another  reason  for  the  focus  on  food  security  during  2002  was  the  international
conference  to  take  stock  five  years  after  the  World  Food  Summit  (known  as  the
‘World Food Summit - Five Years Later’). The Commission and EU Member States
played a prominent role in the preparations for this event, which took place in Rome
in August under the auspices of the UN  Food and Agriculture  Organisation (FAO).
The  main  objective  was  to  review  progress  towards  the  target  set  during  the  1996
World  Food  Summit  to  halve  the  number  of  undernourished  people  worldwide  by
2015.  Given  that  the  annual  rate  of  reduction  of  the  undernourished  since  1996  is
below that which would allow the achievement of the target on time in 2015, FAO’s
Secretariat had identified two principal areas where the Rome Summit could play a
role in accelerating progress towards the goal. Namely, by fostering political will and
mobilising  financial  resources.  The  Commission’s  contributions  to  the  preparation
process included presentation of a Report on the follow-up of the Plan of Action of
the 1996 World Food Summit. Together with Member States, the Commission also
participated  in  an  Open  Ended  Working  Group  that  negotiated  the  Summit’s
Declaration.  The 
final  Declaration,  which  was  adopted  by  Heads  of
State/Government  at  the  Summit  and  was  called  “International  Alliance  against
Hunger”,  called  on  all  parties  to  reinforce  their  efforts  “so  as  to  act  as  an
international alliance against hunger to achieve the WFS targets no later than 2015”.
The Declaration also called for the establishment of  an  Intergovernmental Working
Group  on  the  voluntary  guidelines  to  progressively  realise  the  Right  to  Adequate

65

Food.  President  Prodi  and  Commissioner  Nielson  represented  the  European
Commission.  In  his  intervention,  President  Prodi  reiterated  the  importance  the  EU
attaches to trade within the development agenda. Commissioner Nielson participated
at one of the ministerial-level Round Tables on the theme “The World Food Summit
Plan of Action: results achieved, obstacles met and means of over-coming them”.

During  2002,  the  Commission  has  continued  to  make  progress  in  translating  into
action  the  policy  and  strategic  approach  to  food  security  that  it  adopted  in  1996,
including  through  the  programming  and  implementation  of  the  Food  Aid/Food
Security horizontal budget line66. It has also taken on board the major findings  and
recommendations of the 2000 Evaluation of the Food Aid/Food Security Regulation
and  its  Communication  to  Council  and  Parliament  on  the  future  orientation  and
application of the budget line. The food security interventions undertaken have been
designed to be consistent with the Community’s overall Development Policy as well
as  the  country  and  regional  support  strategies  which  build  on  nationally-owned
strategies for poverty reduction. The Community has continued to stress the need for
careful  use  of  food  aid.  Whilst  it  can  be  an  important  and  essential  part  of  the
immediate response to food crises, it is not an effective way to end famine in the long
term.  Famines  have  complex  origins  that  require  complex  answers.  Famine
prevention requires a broad-based policy approach, which tackles the root causes of
the  problem  –  one  of  which  is  poverty  and  under-development.  Poor  governance,
natural disasters and  conflict can also create the conditions for famine. Where food
aid has been provided, the Commission has sought to ensure that priority be given to
local and regional purchases. In post crisis situations, particular attention was given
to linking relief, rehabilitation and development.

As part of its effort to ensure a more effective approach to famine prevention, taking
account of the different factors that can be involved, the Commission has sought to
deepen  its  policy  dialogue  with  national  authorities  in  a  number  of  beneficiary
countries,  and  to  encourage  them  to  integrate  food  security  objectives  further  into
national  poverty  reduction  strategies.  The  implementation  of  on-going  programmes
and  projects  as  well  as  the  appraisal  process  of  new  operations  are  increasingly
benefiting from the results of  programme  reviews and audits. The Commission has
used  a  number  of  criteria  to  guide  its  decisions  about  priority  countries:  countries
(and specifically Least Developed Countries) with a high incidence of poverty and a
high degree of food insecurity; those with a long term food security policy in place;
and those where the conditions are right for effective utilisation of Community funds.

As  a  result  of  the  exceptional  and  unforeseen  food  crises  during  2002,  the
Commission has had to constantly review its programming  and targeting processes.
A much higher percentage of the overall budget allocation went to food aid than was
initially foreseen. As a result, support for structural food security was reduced. The
table  below  presents  a  comparison  of  the  initial  2002  programming  and  the  actual
allocations as at October 2002.

66

COM(2001) 1 and COM(2001) 473

66

                                                
Summary of initial and final 2002 allocations by instrument and partner
 (€ Million)

Financial support for structural food security

Support to government programmes:

Programme aid

Project aid

NGO Cash Projects

Others (FAO + CGIAR)

Food Aid – through annual allocations

Channelled through:

WFP

EuronAid

UNRWA

Others

Government

Capacity building
Technical Assistance

Policy and strategy support

Commodity price contingencies

Reserve

Initial

241.8

212.8

(176.8)

(36. 0)

20.0

9.0

154.0

90.0

50.0

14.0

23.0
20.0

3.0

5.0

11.2

Final

185.4

126.3

(100.1)

(26.2)

33.2

25.9

231.5

132.0

60.5

15.0

8.0

16.0

34.1
32.3

1.8

2.6

1.4

Overall total BL 2002

435.0

455.067

Food Aid : a response to major food crisis in 2002

Severe drought in the Horn of Africa

Deficient rainfall during the last crop seasons in the Horn of Africa have seriously aggravated
the already fragile humanitarian situation of an estimated 13.6  million people in  Ethiopia  and
Eritrea.  In  addition  to  the  emergency  assistance  previously  provided  for  the  needs  of  the  last
quarter  of  2002  (€32.8  million),  the  Commission  adopted  a  €55  million  emergency  food  aid
assistance programme at the end of the year. Together with an additional food aid allocation of
€25 million to the two countries in early 2003, it brought the EC total contribution to the relief
of the most vulnerable population of Ethiopia and Eritrea to €112.8 million (412,000 Mt of food
aid). If we include the EU Member States' bilateral contributions (€46.5 million), this brings the
total EU response to the crisis in the two countries to €159 million.

While relief is crucial to save lives, both Governments and donors agree that the situation over
the long term will not improve just with emergency food aid. The crisis can only be adequately
addressed if, in parallel to the emergency response, substantial efforts are devoted to tackle the
structural problems. This long-term support is the focus of the EC’s assistance, both through its
food  security  and  budget  support  programmes.  There  are  two  ongoing  food  security
programmes in the Horn of Africa: one of €60 million in Ethiopia (from which €25 million is a
budget support for food security interventions), and an other ongoing programme of €16 million
in Eritrea.

67

Budget line allocation increased to €455 million with the following break down:B7-2000: €151.125.000
– B7-2010: €291.572.000 – B7-2010A: €12.303.000

67

                                                
Food Crisis in Southern Africa

In response to the continuing humanitarian crisis in Southern Africa, the European Union (EU)
announced  in  December  2002  that  its  contribution  had  risen  to  €328  million  for  the  six  most
affected countries (Zimbabwe, Zambia, Malawi, Swaziland, Mozambique, Lesotho).€117 million
of this amount is  managed directly by the European Commission Food Aid and Food Security
budget line and is made up of food aid and emergency distribution of seeds and fertilisers (277
000 tons). Food aid is already being delivered to countries in the region via partners such as the
World  Food  Programme,  Non-Governmental  Organisations 
(NGOs)  or  beneficiary
governments. It will continue to be targeted to the poorest and most vulnerable groups including
HIV/AIDS victims as well as to internally and externally displaced persons including refugees.

This  emergency  assistance  comes  in  addition  to  two  long-term  ongoing  food  security
programmes in Mozambique ( € 60 million) and in Malawi ( €42 million).

Food Security : recipient countries

Country

in €

Ethiopia

Zimbabwe

Afghanistan

Palestine

Zambia

Armenia

Azerbaijan

North Korea

Kyrgyzstan

Malawi

Angola

Mozambique

Haiti

Moldavia

Eritrea

Madagascar

Tajikistan

Niger

Liberia

Equatorial Guinea

Democratic Republic of Congo

Cuba

India

Sierra Leone

Sudan

Pakistan

Burkina Faso

Burundi

Guatemala

Honduras

68

99.300.000

51.400.000

46.300.000

30.000.000

23.000.000

20.300.000

20.300.000

20.000.000

20.000.000

16.000.000

15.000.000

14.800.000

13.800.000

10.400.000

9.700.000

6.900.000

6.600.000

6.500.000

5.500.000

2.500.000

2.400.000

2.000.000

2.000.000

2.000.000

1.600.000

1.300.000

1.100.000

500.000

200.000

200.000

3.3.7.3 Rural Development

70% of the world’s poor live in rural areas and the livelihood of the majority among
these  depend  on  agriculture.  Lack  of  access  to  resources  and  services  increases
dramatically  their  vulnerability  to  shocks.  Rural  development,  by  improving  access
to food through better and more diversified income and services  and  availability of
food through better performing agricultural and commercial systems, is paramount in
the fight against poverty and in sustainably improving food security for the poor.

In  2002  the  Commission  presented  to  the  Council  the  Communication  “Fighting
Rural Poverty: European Community policy and approach to rural development and
sustainable  natural  resources  management  in  developing  countries”68.  In  its
conclusions, the Council welcomed the Communication and stressed the importance
of collaboration between the Commission and the Member States in implementing it.
The  Communication,  which  stresses 
rural
development and the linkage of poverty reduction with livelihoods in rural areas, was
presented and discussed in a forum in Montpellier in September 2002, which brought
together  more  than  200  participants  from  Member  States  and  the  Commission.
During the Forum a number of substantive development issues which have a bearing
on rural livelihoods were addressed and a road map for further analytical work was
outlined.

the  multi-sectoral  character  of 

During the EU Rural Development Forum it became clear that one of the key issues
faced by developing countries is the review of their land policy and the design  and
implementation  of  sound,  pro-poor  land  reform  and  redistribution  programmes.  To
address land reforms in a more co-ordinated manner and as a further elaboration of
the rural development policy, under the guidance of the EU Rural Advisory group, an
EU-wide  Task  Force  was  established  in  2002.  The  Task  Force,  entrusted  with  the
responsibility  of  developing  common  EU  guidelines  to  support  land  policy
development  and  land  reforms,  is  coordinated  by  DG  Development.  EuropeAid
collaborates  actively in its work.  It is envisaged that  a  final draft of  the  Guidelines
will be released for wider consultation in the first half of 2003.

3.3.8. Good Governance and Institutional Capacity Building

The Community’s development cooperation policy recognises that good governance
can be decisive in strategies to reduce poverty. Governance issues are also critical for
the achievement of several of the Community’s other external objectives, including
peace and security and Human Rights.

In  view  of  its  importance,  the  Community  addresses  good  governance  and
institutional capacity building as both a priority sector in its own right, and an issue
to be mainstreamed across other sectors (such as trade, economic policies, the social
sectors and regional integration). Through its development cooperation and external
assistance programmes, the Community is providing direct support in a  wide range
of  areas  that  fall  under  the  ‘good  governance  and  institutional  capacity  building
heading’. These include civil service reform, judicial reform, financial management
and  audit,  parliamentary  activities,  civil  and  political  rights,  freedom  of  expression
and the media, fights against corruption and money laundering, anti-drugs campaign

68

COM(2002) 429 final of 25.07.2002

69

                                                
(and conflict prevention – see separate section), training for ethical review of clinical
studies..

One element of the Community’s potential added value in this area is the  ‘political
dialogue’ that it has with its external partners. This provides a forum to address what
can  be  sensitive  issues.  Community  action  is  also  thought  to  be  more  neutral  than
action by Member States, which have their own history and are bound by a specific
legal system.

In 2002, the Commission recognised the need to develop a more strategic framework
for its work on  good  governance.  On  30 May, the  Development  Council adopted  a
set  of  conclusions  on  “good  governance,  democracy  and  development”.  These
welcomed  the  Commission’s  intention  to  deepen  its  work  in  this  area,  as  well  the
Commission’s  proposal  to  establish  a  working  group  with  EU  Member  States  to
define a consistent and common EU approach to governance issues.

Building on the outcome of the first such meeting between governance experts from
the Commission and Member States in February 2003, the Commission will review
its policy framework on Governance and Development, examining the links between
governance  and  poverty  reduction.  The  Commission’s  approach  acknowledges  that
the  way  public  functions  are  carried  out  as  well  as  the  way  public  resources  and
public  regulatory  powers  are  used  is  critical  to  the  achievement  of  its  broader
development objectives. Poverty reduction depends largely on whether or not public
institutions  carry  out  certain  key  functions  in  an  efficient  and  accountable  manner.
These include: facilitating the capacity of poor people to increase their incomes and
assets;  ensuring  their  access  to  public  services;  and  guaranteeing  their  security  and
access to redress, as well as the protection and promotion of their rights. Overall, the
political and institutional context is critical for poverty reduction policies and has a
major influence on citizens’ confidence in public institutions. Civil society can also
play a key role in helping to promote improved governance and accountability (more
detail on the Community’s approach to working with non-state actors is given in the
Mainstreaming Chapter of this report).

Defining an EU approach to governance and development will reinforce coordination
and  complementarity  mechanisms  between  the  Commission  and  Member  States.  It
will also facilitate EU dialogue with partner countries to define pro-poor governance
agendas and support their implementation. This common policy approach, consistent
with the UN Millennium Declaration and the Monterrey Conclusions, should aim at
supporting  pro-poor  institutional  development  in  partner  countries:  that  is,  better
functioning, more efficient, responsive and accountable state institutions.

70

4.

LOOKING FOR RESULTS: MONITORING AND EVALUATION

The  Commission  is  in  the  process  of  moving  increasingly  towards  results-oriented
external  assistance.  This  paradigm  has  been  translated  on  different  levels  and  this
chapter  deals  with  the  two  main  approaches:  appreciation  of  the  results  (effects,
impact) of EC funded actions through:

– 

– 

Evaluation of strategies, themes and sectors and

Results-oriented monitoring of projects and programmes

4.1.

Evaluation

Evaluation of external assistance is an important cornerstone in the results- oriented
approach to EC policy and its implementation.

The evaluation service produces thematic, sectoral and ‘geographical’ (countries and
regions)  evaluations  as  well  as  evaluations  of  regulations  and  instruments.  It  also
ensures  the  role  of  methodological  guidance,  whereas  project  evaluations  are  the
remit  of  operational  services  and  Delegations.  The  evaluation  service  responds
directly  to  the  Board  of  Directors  of  EuropeAid  and  is  thus  integrated  into  the
decision-making process at the highest level.

4.1.1.

The 2002 Evaluation Programme

The Evaluation Unit’s work programme for 2002 is a part of a long-term strategy to
cover  systematically  the  priorities  of  the  European  Community's  External  Co-
operation,  including  the  programming  process  itself  and  the  “policy  mix”.  The
programme  is  articulated  along  two  main  lines:  evaluations  of  themes  and  sectors
and  evaluations  of  country  and  regional  strategies.  The  aim  is  to  cover  the  main
sectors once every six years.

It  is  in  the  nature  of  evaluations  that  both  lines  of  investigation  will  cross-fertilise
each other: country strategy evaluations always focus on sectors within the countries
and  sector/thematic  evaluations  take  place  within  the  parameters  of  a  country  or
region,  usually 
issues,  namely  gender,
environment, good governance, Human Rights and conflict prevention.

in  combination  with  cross-cutting 

By  the  year’s  end,  10  evaluations  had  been  completed  or  nearly  completed  and  14
evaluations  had  been  launched  or  were  ongoing,  including  3  joint  evaluations  with
Member States and the Bretton Woods Institutions .

4.1.2.

Findings from the 2002 Evaluations

While the diversity of evaluations undertaken in 2002 to a large extent precludes any
sectoral or thematic grouping, the various sets of findings from the studies completed
in  2002  continue  to  point  to  broad  issues  already  identified  in  the  evaluations
completed  in  2001,  namely  the  need  for  clearly-defined  objectives  and  a  coherent
strategy while allowing for responsiveness through the choice of the best intervention
instrument, and through rapid and simple administrative implementation procedures.

71

Findings and conclusions are summarised below69:

4.1.2.1. Evaluations of Sectors and Themes:

The  evaluation  of  the  ALA  Regulation  443/92  noted  that  the  regulation,  with  its
very  broad  scope,  had  required  further  interpretation  through  more  comprehensive
policy  documents  relating  to  Asia  and  Latin  America  (these  regions  in  themselves
subject to major internal disparities). The report found that the regulation itself was
therefore  somewhat  distanced  from  the  prioritisation  of  resource  allocation  and  did
not stress certain key principles, for example relating to coherence, co-ordination and
accountability.  The  limited  resources  dedicated  to  the  regions  concerned  were
considered  inappropriate  to  the  ambitious  stated  goals  set  out  in  policy  documents.
The  evaluation  recommended  that  the  new  regulation  should  be  of  legal  character
and should not define in detail those strategic objectives better covered by regional
and  country  strategy  documents  and  other  declarations  on  co-operation  policy  and
aid management.

A  study  of  the  definition  of  economic  co-operation  indicated  that  Economic  co-
operation  is  one  of the dimensions  of the  EC  co-operation  with  third  countries  and
underlined that there was no official definition of economic co-operation. The study
attempted an operational interpretation through  regional  co-operation  strategies  and
identified  some  elements  that  are  common  to  economic  co-operation:  trade
facilitation,  direct  support  to  private  enterprises,  improving  institutional  and
economic environment.

The  evaluation  of  mobility  grant  awarding  programmes  (scholarships)  consisted
in a comparative analysis of two categories of EC-financed programmes which have
been judged an effective instrument to foster co-operation between the EU and third
countries  in  the  field  of higher  education. However, the report  shows  that  such  co-
operation requires more efficient and flexible procedures to match the heterogeneity
of target countries. Current programmes remain rather modest  given  the  magnitude
of  the  target  group  and  the  report  recommends  to  increase  the  number  of  grants
awarded to all academic staff (those having a spill-over effect) as well as to students.
The Report found significant  added value brought by the EU fostering regional  co-
operation between universities.

An  evaluation  of  fisheries  agreements  and  their  relationship  with  country
programmes  suggests  that  fishery  agreements  (FAS)  would  be  coherent  with  the
development objectives of country programmes if they were carried out in a context
of  sustainable  fishing  practices.  As  this  is  not  the  case  and  as  the  institutional
framework  is  not  conducive  to  the  use  of  sustainable  fishing  practices  (SFP),  it  is
recommended to conclude FAS only with partners ready to co-operate to set up and
enforce  sustainable  fishing  practices.  It  is  also  recommended  to  establish  an
appropriate institutional framework and support institutional building.

The  evaluation  of  the  fight  against  illicit  drugs  and  addiction  found  that  the
majority  of  projects  had  positive,  short-term  effects  for  the  beneficiaries,  but  long-
term effects of assistance may be marginal. The  evaluation recommended to clarify

69

Full reports of completed evaluations are publicly available under:
http://europa.eu.int/comm/europeaid/evaluation/index.htm

72

                                                
the objectives and strategy in the fight against drug abuse and to focus on a limited
number of countries and key sectors. Recommendations included restricting projects
to  countries  where  drugs  are  a  serious  impediment  to  development,  and  to  the
production  areas  or  trafficking  routes.  It  was  also  recommended  that  institutional
development  should  focus  on  strengthening  national  capacities  to  develop  and
operate coherent and co-ordinated drugs policies.

An evaluation was made of the institutional support to the National and Regional
Authorising Officers  (NAOs)  in  ACP  countries.  This  evaluation  found  that,  while
support  has  yielded  some  encouraging  results,  these  have  sometimes  been
compromised  by  a  lack  of  sufficient  analysis  either  of  the  local  institutional
structures  or  of  the  political  environment  in  which  NAOs  operate.  The  study
concluded  that  the  projects  did  help  to  strengthen  the  institutional  capacity  of  the
authorising  officers  to  play  their  role,  but  also  that  the  most  important  part  of  the
assistance  was  directed  to  improving  the  administration  of  EDF  projects.  Future
projects have to draw the line more carefully between institutional strengthening and
operational support to the management of EC aid. NAO performance criteria should
be  extended  from  essentially  financial  indicators  to  measurements  more  clearly
related to the quality of development.

In  2002  two  evaluations  were  finalised of  two  linked  sectors:  one  covering
interventions  in  the  health  sector  (in  the  ACP/ALA/MED  regions)  and  one  on
education  in  the  ACP  regions  financed  under  the  European  Development  Fund
(EDF).

Both  evaluations  underlined  the  pivotal  role  of  the  sectors  concerned  in  the  fight
against  poverty  and  the  fact  that  the  activities  financed  are  well  integrated  into  the
national development strategies. Both evaluations identified a number of  successful
interventions  and  drew  out  common  factors  for  success.  There  is  a  wide  range  of
possible instruments (projects, programmes and budget support) in the education and
health  sectors,  and  both  evaluations  underlined  that  for  each  objective  and  each
country  the  right  instruments  should  be  carefully  considered.  Budget  support  and
sector  wide  approaches  have  significant  advantages,  but  can  only  be  successful  if
certain conditions in the surrounding institutional environment are met.

Both  evaluations  considered  the  possible  anti-poverty  impacts  of  health  and
education  measures  as  well  as  the  implication  on  gender  equality,  and  noted  great
room for improvement. The education evaluation underlined that an education policy
in  itself  does  not  guarantee  universal  access  to  education.  While  education  sector
reform  may  target  poverty  reduction,  it  does  not  necessarily  target  the  poor  as  a
special  group.  Effectiveness  of  the  health  sector  programmes  was  found  to  be
variable,  but  overall  positive,  especially  in  the  areas  of  institutional  strengthening,
improvements  to  peripheral  health  systems,  provision  of  essential  medicines,  and
improved safety in transfusion programmes.

4.1.2.2. Evaluations of country strategies:

Evidence from two country strategy evaluations (South Africa and Morocco), both
substantially  completed  in  2002,  suggests  that  the  current  strategies  are  basically
sound and  relevant to the needs of  the partner countries insofar  as the programmes
are in line with national policy priorities. In both cases the strategies are more tightly
focused,  across  fewer  sectors,  than  previously,  indicating  greater  awareness  of  the

73

need for co-ordination and complementarity with other donor inputs in the name of
efficiency and freedom from duplication.

4.1.3. Outlook on the 2003 Evaluation Programme:

The  work-programme  for  2003  also  foresees  the  completion  of  the  following
evaluations launched in 2002:

The ongoing evaluation of Trade Related Assistance (TRA) considers the impact of
actions  undertaken  between  1996  and  2002  (where  this  can  be  measured)  and
assesses  the  approach  taken  to  programming  TRA  assistance  in  country/  regional
programmes since 2000, in the light of the focus provided by the Doha Development
Agenda. The assessment and judgement of the current approach will take account of
the  capacity  to  learn  lessons  from  the  past,  the  effect  of  the  reform  of  the
management  of  external  co-operation  and  the  emergence  of  a  truly  multilateral
approach in EU trade policy.

The  evaluation  of  Commission  interventions  in  the  transport  sector  in  third
countries addresses the impact of Commission assistance in relation to the range of
goals and higher objectives which apply to transport policy in different regions (trade
facilitation,  regional 
including  for
institutional  aspects.  The  quality  and  impact  of  transport  policy  dialogue  and
accompanying  policy  actions  are  given  particular  importance,  along  with  the
evolution of the sector approach and the importance of crosscutting issues.

integration,  poverty  reduction,  security), 

The  Board  of  the  EuropeAid  Co-operation  Office  requested  the  evaluation  of  the
integration  of  gender  in  Commission  co-operation  within  third  countries  in
November 2001. The evaluation is nearly completed and includes an assessment of
how  the  Commission  gender  commitments  have  been  put  into  practice,  the
mainstreaming of gender into procedures, instruments and country strategies and an
assessment  of  the  contribution  of  Commission  financed  actions  to  redress  and
improve gender balance.

The  evaluation  of  Rehabilitation  and  Reconstruction  will  assess  globally  the
policy  and  strategic  frame  of  the  budget-line  and  its  adequacy  in  view  of  the  EC’s
objectives and will have a close look on the link between emergency, rehabilitation
and development, as well as on conflict prevention.

The  objective  of  the  evaluation  of  Population  and  Development  is  to  provide  the
Commission  with  an  assessment  of  the  nature  and  evolution  of  the  objectives  and
policies concerning Population (including settlement  and  migration)  in  external  co-
operation programmes. The evolution and volume of programmes concerned will be
considered  as  well  as  their  relevance,  effectiveness,  efficiency,  sustainability  and
impact and internal/external coherence. The primary purpose of the  evaluation is to
help improve impact and coherence in the application of the Commission’s approach
to Population and Development in partner countries.

The  evaluation  of  Economic  co-operation  MEDA  aims  at  assessing  how  far
economic  cooperation  initiatives  with  MED  countries  contributed  to  achieving  the
objectives of the MEDA programme and assisted the partner countries in addressing
the  main  obstacles  to  increase  the  competitiveness  of  their  economy,  develop
economic  links  with  the  rest  of  the  world  and  achieve  sustainable  growth.  This

74

evaluation  is  part  of  a  series  of  evaluations  that  covers  aspects  of  economic
cooperation in different geographical areas.

Also, end 2002, evaluations of country strategies for the Ukraine, Bangladesh and
Malawi were well underway. Two evaluations treating co-operation and strategy in
the Mercosur and Balkan (CARDS) regions have recently been launched. All five
evaluations are expected to be finalised in 2003.

The  joint  donor  evaluation  on  the  3  C’s  (co-ordination,  complementarity  and
coherence) had been initiated by the Netherlands in late 2000, and initial scoping and
pilot stages had indicated the need for a fundamental re-think of the parameters and
objectives of the evaluation. Accordingly a Workshop was convened early 2003 and
the main conclusion drawn was that an assessment of the application and impact of
the  3Cs  will  better  and  more  rapidly  be  achieved  likely  by  means  of  a  loose
framework within which a series of smaller-scale evaluations can be carried out.

Participation in the joint donor evaluation on External Support to Basic Education
(chaired  by  the  Netherlands)  and  the  Comprehensive  Development  Framework
under the chairmanship of the World Bank will also continue in 2003.

The Evaluation programme for 2003 comprises 14 new evaluations and studies; the
final version is published on the EuropeAid internet website.

4.1.4.

Improving evaluation methods

4.1.4.1. Developments in Evaluation Methodology and Feedback

As foreseen in the 2002 programme, the Evaluation Unit has continued the work on
evaluation  quality  by  developing  terms  of  reference  and  updating  methodological
approaches. At the heart of the approach is a set of key "evaluation questions", each
with  its  assigned  judgement  criteria  and  indicators.  Each  stage  of  an  evaluation  is
subject  to  detailed  discussion  with  a  group  of  key  Commission  Services.  This
approach allows sharper focus on important issues and ensures that evaluations yield
relevant and well-founded conclusions and practical recommendations.

The  Evaluation  Unit’s  work  on  feedback  mechanisms  focused  on  increasing  the
awareness  of  evaluation  results,  the  uptake  of  evaluation  recommendations  and  the
application  of  lessons learned.  Three initiatives to  strengthen  the  feedback  function
were  launched  during  2002:  1)  a  mapping  of  experiences  of  the  current  feedback
work  of  the  unit  and  identification  of  best  practices  2)  an  inventory  of
project/programme  evaluations managed by Delegations  and  Geographical  Units  3)
the  systematic  use  of  a  three-column  fiche  contradictoire,  listing  key  evaluation
recommendations,  the  Commission  Services'  responses  to  each  of  them,  and  the
action finally taken.

Methodological work for the provision of revised guidelines and new tools, notably
on  sectoral  and  thematic  topics,  as  well  as  on  improving  further  the  quality  of
country  strategy  evaluations,  started  in  October  and  will  continue  through  its  three
year workplan.

75

4.1.5.

Priorities for Action Highlighted by the 2002 Evaluations

Overall  the  studies  concluded  with  positive  results  and  constructive  insights  for
further  improvement.  Viewed  globally,  they  suggested  the  Commission  should
pursue its efforts to develop further the following areas:

– 

Establishment of clear objectives, focussing on (a limited set of) priorities and
integrated into an overall strategy;

–  Within  a  clear  and  coherent  strategy,  selection  by  the  Commission  and  the
partner country, of the most appropriate instrument or the most appropriate mix
of instruments;

– 

– 

Identification and exploitation of links and synergies between interventions in
the different Priority Areas;

Flexible,  and  rapid  financing  mechanisms,  as  well  as  simple  and  rapid
administrative mechanisms to foster efficiency and effectiveness.

4.2.

Project results : results-oriented monitoring

The  results-oriented  monitoring  system  (ROM)  allows  a  rapid  appreciation  of  a
project  or  programme’s  performance,  as  well  as  of  its  wider  implications  and
provides  the  Commission  with  independent  advice  on  its  project  portfolio.  The
system  was  initially  developed  and  tested  in  2000/2001  before  expansion  during
2002 to all regions of the Commission’s external co-operation. Having one consistent
approach ensures that the Commission has comparable data for  all regions where it
provides external assistance.

4.2.1.

Achievements in 2002

In the light of the promising outcome of the test phase70 (see the annual report 2001),
the RO monitoring system was extended to cover all regions concerned by the EC’s
external co-operation. In the last quarter of 2002 and slightly ahead of schedule, the
input  –activity  monitoring  system  in  TACIS  countries  (Newly  Independent  States
and Mongolia) made the transition to the Results – Oriented approach.

Five teams, organised along geographical lines (Tacis and the Balkans (Cards) being
covered by one team) were put into place and fulfilled their first year workplans:

– 

– 

– 

603 projects were monitored71

743 reports72 were written

A total of € 6144.1 million financial volume was covered

70

71

72

for a more detailed description of the methodology, please refer to the annual report 2001, chapter 10.3
http://europa.eu.int/comm/europeaid/reports
In addition to these, 349 projects were monitored through the Tacis input activity system.
The difference between projects visited and reports  written  in  a  single  year  is  mainly  due  to  regional
projects which are counted as one, but who entail the visit of several national components to assess the
programme in its entirety.

76

                                                
The  results  of  Commission  projects  produced  are  globally  good:  A  significant
majority of projects record good effectiveness, i.e. benefits actually received by the
people as well as promising impact. The performance of projects and programmes
was  good,  and  on  average,  the73  projects  assessed  were  progressing  “according  to
plan” or better.

Although it is too early to establish any trend, especially as the projects samples are
quite  different,  nevertheless,  a  slight  improvement  over  2001  project  performance
may be noted.

4.2.2.

Insights from the First year of the consolidation phase

A  quantitative  overview  is  presented  below,  further  data  for  each  region  are  in  the
regional chapters.

MED

ACP

ASIA

LA

Total

2002

Tacis

Countries visited

No 
covered

projects

No reports

Mio € covered

10
(3)

17
(349)75

22
(578)

38
(736.5)

Cards/
Western
Balkans

4

3376

37

2074

40

108

262

187

298

13

79

95

15

104

104

73.5

1172.7

2911

1171.5

777.4

102
(3)

603
(349)

743
(578)

6144.1
(736.5)

Attention: The small size of the sample may impede statistical significance

Each  of  the  five  main  monitoring  criteria  below  is  thoroughly  defined  and  then
broken  down  into  its  components  (sub-criteria),  which  the  monitor  has  to  consider
carefully before giving a rating77. For purposes of qualitative analyses, use is made of
the  textual  explanations  contained  in  the  report  and  monitors  notes.  Whilst  the
analysis has been done with all care, it must be emphasised that the limited size of
the  sample  impedes  statistical  significance.  The  results  presented  in  this  report
should be considered with care and should not be taken out of the context in which
they  are  presented.  Some  of  them  may,  at  best,  provide  orientation  for  the
preparation  of  further,  more  in-depth  investigations  into  specific  aspects  of  project
performance.

73

74

75

76

77

Including six countries in the EU, location of head office’s of regional projects
Numbers in brackets refer to the previous Tacis monitoring system and are additional.
The ratings are a: very good, b: good, c: some problems, and d: major problems.
The majority (30) of the monitored projects were financed under the Phare and Obnova Programmes.
The data should therefore not be used to judge the performance of the CARDS programme.
The ratings are a: very good b: good c: some problems and d:  major problems. To calculate averages
and compare these have been given numerical values, a: 4 points, b: 3 points; c: 2 points and d: 1 point.
The hypothetical middle line (of a numerical value of 2.5) has been chosen as being "on track", thus a
project on the statistical average follows the programmed course and performs well.

77

                                                
4.2.2.1 Analysis by monitoring criteria

The  five  criteria  assessed  are  relevance,  efficiency,  effectiveness,  impact  and
sustainability.

Average ratings for main criteria, by region

Tacis (only
ROM)

Western
Balkans

MED

ACP

Asia

Latin
America

Average
78

Relevance

Efficiency

Effectiveness

Impact

Sustainability

2.6

2.4

2.3

2.4

2.3

2.4

2.4

2.4

2.80

2.51

2,5

2.83

2.68

2.39

2,6

2.86

2.05

2.85

2.60

2,8

2.93

2.1

2.1

2.2

2.82

2.52

2,6

2.83

2.91

2.38

2,7

2.78

2.81

2.48

2,6

2.85

2,62

2,56

2,69

2,62

2,60

Attention: The small size of the sample may impede statistical significance

Projects are generally relevant (2.62). Their original design is adequate, but usually
the  weakest  point  considered  for  this  criterion.  Exception  is  made  for  Tacis  and
Balkan  countries  where  the  original  design  is  rated  as  relatively  good;  this  may  be
due  to  the  fact  that  during  an  extended  inception  phase  projects  are  thoroughly  re-
considered.  In  the  Latin  America  region  it  is  noted  that  recent  projects  are  paying
more  attention  to  the  decentralisation  processes  and  strengthening  of  civil  society
during the design phase, thus fostering effective basic democracy.

Project  efficiency  showed  the  weakest  performance,  although  still  slightly  better
(2.56) ‘than planned’ (2.5), timeliness of inputs and activities often being pointed out
as problematic. Results achievement and flexibility, the latter an essential factor for
project success have mostly positive ratings, above each  79regional average. Overall
projects are therefore sufficiently efficient, in spite of a certain tardiness of payments
and activities.

Effectiveness  (2.69),  meaning  the  actual  benefits  received  by  people,  scores  best
overall  as  in  most  regions,  notably  Latin  America  (2.93)  and  the  Mediterranean
(2.85).  Successful  projects  were  characterised  by  good  beneficiary  involvement,
participation  and  awareness,  based  on  clear  project  objectives.  Good  performance
was also fostered by the capacity of projects to adapt to changing outside parameters
and underlying assumptions.

Projects and programmes generally have a good impact (2.62) in all regions (up to
2.83)  with  the  exception  of  the  Balkans  (2.1)  and  to  a  lesser  extent  the  Tacis

78

79

The  average  across  regions  is  weighted  by  the  number  of  projects.  Methodological  note:  when  a
criterion  scores  in  the  exact  middle,  the  lower  score  is  systematically  given  in  the  monitoring  report
(e.g.  b/c  or  2.5  becomes  c  or  2).  Therefore,  when  averages  are  calculated  over  the  the  subcriteria,
overall ratings improve by .05 to .1 point compared to averages calculated over criteria ratings.
Please refer to the geographical chapter for more information

78

                                                
countries (2.4). Reports also indicate very positive « unplanned wider effects », with
ratings  between  2.8  and  3.02.  Good  impact  performance  was  fostered  by  projects'
capacity to adapt to changing outside circumstances, on the level of overall goals.

Concerning  the  assessment  of  impact,  it  has  to  be  underlined  firstly  that  often  the
contribution  of  the  projects  and  programmes  is  small  relative  to  the  needs  to  be
solved,  and  secondly  that  several  other  factors  beyond  the  direct  control  of  the
projects  must  turn  out  favourably  if  overall  goals  are  to  be  met.  In  some  cases,
impact  will  become  apparent  more  slowly  than  originally  expected  or  only  after
project completion. Recently launched projects tend to initiate long term sustainable
dynamics of change rather than immediate and direct visible changes.

With  an  overall  average  of  2.6  across  all  regions,  the  general  picture  for
sustainability is positive. The scores differ very much from region to region (2.1 –
2.91) and also among the subcriteria; the highest for environmental adequacy in the
Med  (3.24)  and  the  lowest  for  technical  adequacy  (1.8)  in  the  Balkans.  Generally
projects score well on policy support and socio-economic or technical adequacy, but
financial sustainability is constantly identified as potentially problematic. Indications
are  that  both  the  design  and  the  implementation  of  new  generation  projects  reveal
higher  attention  to  people  participation,  gender  equity,  cultural  adequacy,  ethnic
minorities,  etc.  Hence  beneficiaries  tend  to  show  a  more  active  attitude  in  the
determination and preservation of project effects.

For  futher  information  and  analysis  on  results  in  the  regions,  please  refer  to  the
respective regional chapter.

4.2.2.2 Results by sectors

The Commission has defined six priority areas for its co-operation:

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2,60
2,51
2,63
2,54
2,40

2,54

2,64
2,58
2,66
2,65
2,73

2,65

2,58
2,55
2,69
2,62
2,53

2,83
2,67
3,00
2,71
2,50

2,59

2,74

2,64
2,65
2,75
2,65
2,63

2,66

2,62
2,49
2,61
2,50
2,49

2,54

2,65
2,40
2,95
3,00
2,70

2,74

2,62
2,56
2,69
2,62
2,60

2,62

€

N°  of  projects
monitored
Budget 
million
Relevance
Efficiency
Effectiveness
Impact
Sustainability
80

Attention: The small size of the sample may impede statistical significance

80

Sustainability is analysed along six lines which have the same  weighting: policy  support, institutional
and capacity building, socio-cultural issues/gender, adapted technology, environmental issues, financial
and economic soundness. For further details, please refer to last year’s report.

79

 
 
 
 
 
                                                
Trade and Development

Projects  within  this  sector  are  relevant  and  effective  but  weaker  in  the  area  of
sustainability.  The  sample  is  relatively  small  (35  projects,  or  5.6  %  of  all  projects
monitored) and conclusions from the data have to be drawn with great caution. Most
projects visited were in the ACP (14) or the Balkans (9) regions. Detailed data show
that  projects  have  very  good  policy  support  and  show  good  socio-cultural  and
technological  adequacy 
financial
fostering  sustainability,  but 
sustainability is very weak and puts the continuity of benefits or services in question.

the  expected 

Regional Integration

Performance  of  regional  projects  is  good  (2.65),  but  the  overall  result  masks  great
disparities.  Virtually  all  projects  monitored  were  in  the  ACP  (41)  or  in  the  Med
region  (44).  Whereas  regional  projects  in  the  ACP  are,  on  average,  very  low
performers  (2.3),  they  show  excellent  performance  in  the  Med  regions  (2.87).
Analysis shows certain commonalties in the structure of performance: efficiency was
the relatively weakest spot  for  all  projects  (ACP  2.18  and  Med  2.78),  with  activity
and  input  timeliness  as  particular  problems.  A  short  analysis  of  sustainability
presents  similar  parallels:  financial  sustainability  was  in  all  cases  the  weakest
whereas environmental adequacy was the best performing subcriterion.

Macroeconomic Policies and Social Sectors

This  sector  figures  prominently  in  the  portfolio  monitored,  with  nearly  28  %  of
budget covered and 20 % of Projects. The performance of projects is rather uneven
across  the  regions,  with  excellent  results  in  Latin  America  (2.91),  not  quite  ‘on
target’ in the ACP (2.46) and very weak in the Med (2.29)81. Projects were globally
effective, with very positive ‘secondary effects’ (excepted in the Med), but seem to
suffer with respect to their original design  and to the timeliness of  implementation.
Expectations  for  sustainability  differed  also,  from  Latin  America  showing  a  strong
3.0,  to  ACP's  unpromising  2.28.  All  projects  have  in  common  excellent  socio-
cultural quality but weak prospects concerning financial sustainability.

The  sample,  -  as  large  as  it  is,  is  not  representative  as  particularly  in  this  sector  a
large  share  of  the  budgets  is  channelled  through  budget  support  and  sector-wide
approaches. These instruments go beyond the classical project approach and are not
(yet) covered by the RO monitoring.

This  sector  includes  the  subsectors  ‘education  ‘  and  ‘health’,  for  which  a  separate
analysis follows below.

Transport

The  transport  sector  has  few  projects  (4%  of  those  monitored)  but  relatively  large
ones (13.6 % of  financial volume covered) and, together  with the category ‘others’
shows overall the best performance (2.74). Transport projects with a score of 3.0 are
exceptionally  effective  (benefits  to  the  people),  and  very  relevant  (2.83).  This
performance is the more interesting as the large majority of projects (20) have been
implemented  in  ACP  countries.  Sustainability  is  overall  acceptable,  (2.5)  but  not

81

Please see footnote 76.

80

                                                
quite  ‘as  planned’  in  the  ACP  (2.38).  Projects  are  very  good  in  terms  of  socio-
cultural, technological and environmental quality, but the financial sustainability has
been signalled as potentially problematic.

Food Security and Rural Development

This sector also figures  prominently  in  the  portfolio  monitored, with 23.6  %  of the
budget  covered  and  more  than  27  %  of  the  projects.  Performance  is  globally  good
(2.66),  in  all  regions  on  or  above  ‘target’  (2.5  –  2.79,  depending  on  the  region).
Projects  are  very  effective,  are  relevant  and  promise  good  impact  and  efficiency
(2.65). Sustainability is mostly promising, with the same characteristics as observed
in other sectors: good or very good socio-cultural, technological and environmental
adequacy and good policy support, but weak probable financial sustainability.

This  sector  includes  the  subsector  ‘water  and  sanitation’,  for  which  a  separate
analysis follows below.

Institutional Capacity Building and Good Governance

This sector is also rather important in the portfolio monitored, with nearly  26 % of
the  projects,  though  only  13.3  %  of  the  budget  covered.  With  nearly  half  of  the
projects monitored, ACP is the preponderant region in this analysis. Projects in this
sector  score  close  to  the  average  performance  but,  they  perform  better  than  the
average  ACP  project.  The  strongest  aspect  is  relevance  for  all  projects.  Secondary
and  wider  unplanned  effects  score  very  good  ratings,  well  above  average.
Appreciation  of  sustainability  aspects  differs  in  performance,  but  the  financial  side
was  generally  signalled  as  being  (potentially)  problematic.  Most  services  promoted
by  projects  do  not  show  sufficient  self-financing  perspectives  or  project  authorities
seem to lack the capacity to assume long-term costs.

The projects included in this sector are relatively diverse, due also to the fact that all
NGO  co-financed  projects  are  included,  independent  of  the  specific  subject  area  in
which they are engaged.

‘Other’

Projects  in  this  category  are  ‘multi-sector’,  ‘not  allocated’  or  ‘urban  development’.
The  sample  is  very  small:  2.8  %  of  projects  or  1.4  %  of  budget  covered,  and  an
analysis by the three categories would not be statistically relevant.

81

Subsectors of specific interest (€ million)

Education

Health Water

Total or average
all projects
for comparison only

N° of projects monitored

712

48

593

35

264.3

29

6.144,1

603

Relevance

Efficiency

Effectiveness

Impact

Sustainability

Education

2,76

2,65

2,89

2,78

2,67

2,75

2,30

2,33

2,47

2,38

2,18

2,33

2,74

2,77

2,81

2,76

2,68

2,75

2,62

2,56

2,69

2,62

2,60

2,62

The education sector is rather important in the project portfolio, with 16.5 % of the
financial volume covered  and 7.6 % of  all projects monitored. Performance is very
good, but not evenly so in all regions. Education projects in the ACP, Latin America
and Asia regions (a total of 41 projects for €479.2 million; performance 2.74 each)
are  excellent  performers.  Despite  very  good  results  for  the  other  criteria,  projects
tend  to  have  a  little  lower  level  in  probable  sustainability.  This  seems  to  be  due
mostly  to  financial  sustainability;  even  where  projects  are  perfectly  embedded  in
local  structures  serious  doubts  about  financial  sustainability  can  arise  because  the
follow-up  costs  may  not  be  met  without  donors'  assistance.  On  the  other  hand,
education is not among the strongest sectors in the Med Region (6 projects, €230.4
mio; performance 2,37).

The sample, as large as it is, is not representative, as a large share of the budgets in
this sector are channelled through budget support and sector-wide approaches. These
instruments go beyond the classical project approach and are not (yet) covered by the
RO monitoring.

Health

Comparison shows that health is one of the weakest performers. Its overall average
performance is 2,33; 11% lower than the overall average performance of all sectors.
The structure of the findings shows  that  effectiveness  and  impact  are  the  relatively
strongest  areas,  with  relevance  and  efficiency  weaker  and  sustainability  very
doubtful.  A  finer  analysis  of  the  attribute  on  the  sub-criteria  level  shows  better
secondary  and  wider  unplanned  effects,  as  well  as  good  technological  and
environmental quality, while the weakest area is financial sustainability.

The sample is not very large nor necessarily  representative for EC activities in this
sector.  As  in  the  case  of  education,  a  large  share  of  the  budgets  are  channelled
through budget support and sector-wide approaches.

Water Supply and Sanitation

The projects in the water sector are generally performing very well (2.74). It is one of
the strongest sectors in the Med (7 projects, €30.2 million; performance 2,98) and the

82

ACP  (7  projects,  €75.3  million;  performance  2,74)  regions.  In  Latin  America,
however,  where  the  largest  share  of  the  sample  is  executed,  (11  projects,  €144.9
million),  performance  is  adequate  (2.59).  The  structure  of  performance  shows
parallels,  with  good  relevance, efficiency  and effectiveness, but findings  diverge  in
sustainability where Med reports very good prospects, but less so Latin America and
ACP.

The analysis of causes in the Med concludes that the good performance of the sector
can  be  attributed  to  a  number  of  facts,  notably  that  the  awareness  among  the  local
actors and the populations in the Med Region of the seriousness of the water problem
appears to have created consciousness  and willingness  to contribute  to  the  effort to
find solutions.

The  analysis  of  causes  in  Latin  America  relates  that  Water  Supply  and  sanitation
projects appear to be relevant as they address a crucial and easily identifiable set of
problems. For the same reason, efficiency and effectiveness are acceptable due to the
fact  that  results  are  usually  tangible.  Sustainability  is  a  difficult  question,  as  rural
water projects developed under foreign assistance tend to suffer deterioration if they
do not guarantee the required self-sustaining mechanisms.

4.3.

Conclusions

Results achievement and performance of EC funded projects and programmes have
been  judged,  generally,  as  being  good.  Analysis  of  the  structure  of  performance
suggests the following lessons to be learned:

– 

– 

– 

– 

Flexibility and capacity to adapt to changes tends to enhance the performance
of  projects.  There  are  also  indications  suggesting  a  review  of  the  project
concept when it actually starts implementation did foster better performance.

integration 

Good 
local  structures,  policy  support,  and  beneficiary
involvement clearly foster effectiveness and sustainability and should be given
attention in the design of projects.

in 

Financial  sustainability  is  identified  most  often  as  a  potential  source  of
problems for projects.

Timeliness of inputs and activities is suboptimal in many projects, the narrative
comments in monitoring reports indicate heavy (EC) procedures and quality of
project management as reasons in many cases.

83

5.

HORIZONTAL ACTIVITIES AND MAINSTREAMING

In  addition  to  its  activities  in  the  six  priority  areas  described  previously
(cf. Chapter 3),  the  Community  has  identified  crosscutting  themes  that  should  be
“mainstreamed”  (integrated)  at  every  stage  and  within  all  of  the  Community’s
development cooperation and external assistance programmes. These are:

– 

– 

– 

– 

the promotion of human rights;

equality between men and women;

the environment; and

conflict prevention.

As  well  as  integrating  these  considerations  into  policy  dialogue  and  into
interventions  in  its  six  priority  sectors,  the  Community  has  access  to  a  number  of
horizontal or thematic budget lines which it can use to fund targeted activities. These
funds are not allocated to any particular region, unlike the main financial instruments
that exist for external action (the European Development Fund and the budget lines
for cooperation with each region). They can be useful in several ways. For example,
in  conflict-affected  countries  or  in  post-conflict  situations,  the  Rapid  Reaction
Mechanism can be used to conduct rapid one-off actions and to kick-start projects or
programmes.  They  can  also  provide  complementary  funds  –  for  example,  the
HIV/AIDS budget line is being used to step up assistance in this area as part of the
Community’s Programme for  Action  on  Communicable  Diseases  in  the  Context  of
Poverty  Reduction.  They  can  also  facilitate  pilot  initiatives.  For  example,  to  test  a
new  approach  before  it  is  integrated  into  country  and  regional  strategies  (at  which
point funding should be taken over by the Community’s core financial instruments).

The  Commission  recognises  that  complementarity  between  country  strategy  papers
and  horizontal  budget  lines  needs  to  be  improved  in  order  to  bring  about  greater
coherence  in  the  Community’s  external  actions.  One  of  the  problems  is  that  the
horizontal  budget  lines  are  programmed  on  a  different  time  horizon  (biannual  or
annual)  than  the  main  financial  instruments.  As  a  step  towards  improved
complementarity,  in  2003  the  Inter-Service  Quality  Support  Group  will  be
developing quality standards for the programming of horizontal budget lines.

5.1.

MAINSTREAMING  HUMAN  RIGHTS  AND  DEMOCRACY 
WITHIN THE EU

ISSUES

In order to promote greater coherence in the Commission approach’s to human rights
and democracy at country and regional levels, human rights and democracy concerns
have  been  systematically  covered  at  inter-service  strategy  meetings  and  in  Country
Strategy  Papers.  Particular  emphasis  has  been  accorded  to  the  EIDHR  focus
countries  set  out  in  the  2002-2004  programming  document.  Human  rights  country
profiles have also been prepared for use within the Commission and advice has been
given  on  the  policy  implications  of  particular  human  rights  cases  in  non-member
countries.

84

Commission  officials  regularly  participate  in  meetings  of  the  Parliament  on  human
rights  issues,  including  the  Committee  on  Foreign  Affairs,  Human  Rights  and
Common Security and Defence Policy, and a liaison link has been created with the
Parliament election unit. A number of MEPs have headed missions in Sierra Leone,
Pakistan, Ecuador and Kenya.

The Commission has regularly contributed to geographical Council Working Groups
to  promote  the  coherence  of  human  rights  policy,  including  the  Council  Working
Group  on  Human  Rights  (COHOM)  and  the  Working  Groups  for  Asia,  Latin
America, the Mediterranean Region and Africa. A survey of Member State activities
in the field of human rights and democracy training for civil servants was carried out
in 2002. On the basis of this information and its own research, the Commission has
designed  programmes  of  basic,  advanced  and  specialised  training  which  will  be
launched in 2003. Member States were also consulted in the possibility of renewing
the  ‘Human  Rights  Regulations’  which  provide  the  legal  basis  for  financing
operations under EIDHR.

5.1.1.

Improved programming

As  required  by  the  2001  Commission  Communication  on  human  rights  and
democratisation  in  third  countries,  the  2002-2004  EIDHR  Programming  Document
was  updated  in  2002,  following  22  EIDHR  programming  identification  missions.
The  numerous  missions  provided  an  important  opportunity  to  seek  to  complement
activities  identified  in  the  CSPs  and  mainstream  the  protection  of  human  rights  in
National Indicative Programmes.

The  Human  Rights  and  Democracy  Committee, 
the  European  Parliament,
Commission  Delegations  and  Geographical  desk  officers,  and  human  rights  NGOs
were all consulted on the EIDHR Programming update.82

5.1.2.

Enhanced dialogue with partners on human rights and democracy issues

A  human  rights  dialogue  was  ongoing  with  China  and  started  with  Iran  in  2002.
Human  rights  NGOs  were  consulted  in  regular  meetings  of  the  NGO  network  in
Brussels  and  through  the  EU  Human  Rights  Discussion  Forum  under  the  Danish
Presidency in December 2002. Regional meetings were held in Jordan and Morocco
to communicate the human rights and democracy work to civil society organisations
in non-member countries. The dialogue with partner countries was enhanced by the
EIDHR programming identification missions in 2002.

5.1.3

Action in international forums

The  Commission  participated  in  and  contributed  to  EU  positions  in  the  UN
Commission  on  Human  Rights  in  March-April  and  on  the  UN  General  Assembly
Third  Committee  in  October-November  2002.  In  both  forums  the  Commission
drafted and delivered statements on behalf of the European Union. The Commission
also  contributed  to  EU  positions  concerning  human  rights  and  democracy  in  the
OSCE  and  Council  of  Europe,  and  participated  in  and  contributed  to  the  annual
OSCE human dimension review.

82

http://europa.eu.int/comm/europeaid/projects/eidhr/documents_en.htm#eidhr

85

                                                
5.1.4.

Promotion of human rights education

Human rights education and  training  are a major focus of EU human rights policy.
The  Commission  in  2002  provided  support  to  the  European  Masters  in  Human
Rights  and  Democratisation  (EMA),  which  is  coordinated  by  the  European
Inter-University  Centre  for  Human  Rights  and  Democratisation  (EIUC),  an
association of EU universities in all 15 Member States with its seat in Venice, Italy.
After  an  intensive  six-month  training  by  leading  experts  at  the  seat  of  the  EIUC,
90 students from the EU and the candidate countries were allocated to a university in
another  Member  State  to  continue  specialised  research.  The  EIUC  also  provides
internships  in  international  organisations,  including  the  UN  Office  of  the  High
Commissioner of Human Rights and EU Delegations around the world, ensuring that
the human rights skills of EMA graduates can be put to immediate use. Commission
and EU experts participated in the teaching programme of the EMA.

The  Commission  also  participated  in  regular  training  programmes  for  EU  election
observers and core staff, organised by the ‘Needs’ project.

5.1.5.

Training for ethical reviews

More  and  more  clinical  trials  are  conducted  by  pharmaceutical  industries  in
developing countries and  as part of  publicly  funded research projects  such  those of
the EDCTP to fight poverty-related diseases like malaria, tuberculosis and HIV. It is
important  that  the  clinical  trials  undertaken  in  this  context  comply  with  normal
European  ethical  standards.  Therefore  Action  33  of  the  Science  and  Society  action
plan provides for the development of an international dialogue on  ethical principles
through a series of conferences and workshops. An important aim is to build capacity
for  ethical  reviews  of  clinical  studies  in  developing  countries.  A  number  of
workshops  have  already  been  held,  mainly  in  collaboration  with  the  US  National
Institutes of Health (NIH).

5.2

EUROPEAN  INITIATIVE  FOR  DEMOCRACY  AND  HUMAN  RIGHTS
(EIDHR)

Chapter B7-70 of the budget “European Initiative for Democracy and Human Rights
(EIDHR)”  supports  projects  in  the  fields  of  human  rights,  democratisation  and
conflict  prevention,  usually  carried  out  in  partnership  with  NGOs  and  international
organisations.  Council  Regulations  975/199983  and  976/199984  provide  the  legal
basis. In 2002 some €104 million went to human rights, democratisation and conflict
prevention  projects.  The  Commission  communication  of  8  May  2001  on  the
European  Union’s  role  in  promoting  human  rights  and  democratisation  in  third
countries85 recommended a strategic  approach for the  EIDHR that  was  longer  term

83

84

85

Council  Regulation  (EC)  No  975/1999  of  29  April  1999  laying  down  the  requirements  for  the
implementation  of  development  cooperation  operations  which  contribute  to  the  general  objective  of
developing and consolidating democracy and the rule of law and to that of respecting human rights and
fundamental freedoms, OJ L 120, 08.05.1999.
Council  Regulation  (CE)  No  976/1999  of  29  April  1999  laying  down  the  requirements  for  the
implementation of Community operations, other than those of development cooperation, which, within
the framework of Community cooperation policy, contribute to the general objective of developing and
consolidating  democracy  and  the  rule  of  law  and  to  that  of  respecting  human  rights  and  fundamental
freedoms in third countries, OJ L 120 of 08.05.1999
COM(2001)252 final.

86

                                                
and  more  focused  on  certain  priorities  with  a  view  to  greater  impact  and
effectiveness.  It  also  stressed  the  need  for  value  added  and  complementarity  with
other  financial  instruments.  Lastly,  it  recommended  selecting  just  a  few  thematic
priorities and target countries

In  follow-up  to  the  Council  conclusions  of  25  June  2001,86  which  welcomed  “the
Commission’s  approach  to  reform  of  the  programming  and  implementation  of  the
EIDHR”, the Commission  adopted  on  20  December  2001  a  2002-2004  programme
for  the  EIDHR  taking  into  account  these  requirements.  The  activities  financed  in
2002 have been broken down globally and by region and by target country.

EIDHR  priorities  for  2002:  objectives  were  identified  following  numerous
consultations  with  the  geographical  departments  of  the  Directorates-General
concerned  and  the  Commission’s  Delegations  in  non-member  countries.  Certain
issues of key concern to the EU, such as rights of the child and equality of the sexes
were incorporated into all the identified sectors.

Thematic priorities

A restricted number of priorities were chosen for 2002:

– 

– 

– 

support for abolition of the death penalty

combating  racism,  xenophobia  and  discrimination  against  minorities  and
indigenous peoples.

support for  efforts  to combat  torture  and  impunity  and  to  set  up  international
tribunals and the International Criminal Court

– 

support for democratisation, good governance and the rule of law

Five calls for proposals were issued in 2002: four in April concerning: abolition of
the  death  penalty;  combating  racism,  xenophobia  and  discrimination  against
minorities  and  indigenous  peoples;  prevention  of  torture  and  rehabilitation  of  the
victims  of  torture;  and  support  for  the  work  of  international  tribunals  and  for  the
setting up of the International Criminal Court. The fifth, for democratisation projects,
was published in July.

5.2.1.

Abolition of the death penalty

The  EU  has  long  waged  an  ambitious  campaign  in  international  forums  and  in
dialogue with all non-member countries against the death penalty. The EU’s primary
objective  is  the  universal  abolition  of  the  death  penalty.87  Its  commitment  was
reaffirmed in Article 2 of the Union’s Charter of Fundamental Rights. Following the
call  for  proposals  in  April  2002  46  proposals  were  received,  of  which  seven  were

86

87

The Council welcomed and encouraged “the Commission’s resolve to adopt a more strategic approach
to  the  European  Initiative  for  Democracy  and  Human  Rights  (EIDHR)  so  that  the  programmes  and
projects match the EU’s commitments and policies and contribute to the implementation of core human
rights  instruments.  It  welcomes  the  Commission’s  approach  to  reform  the  programming  and
implementation of the EIDHR and the overall reform of EC external assistance”.
The EU’s aims are set out in the guidelines adopted in 1998.

87

                                                
financed for a total of €4.9 million: two in the ACP countries, one in Asia and four of
global reach.

5.2.2. Combating  racism,  xenophobia  and  discrimination  against  minorities  and

indigenous peoples

This issue is of major concern to the EU and is an integral part of its human rights’
activities. It is engaged in promoting the  principle of  equal treatment, whatever  the
person’s  race  or  ethnic  origin,  and  in  promoting  and  implementing  the  rights  of
people  belonging  to  minorities  and  indigenous  peoples.  In  response  to  the  call  for
proposals in April 2002 there were 273 proposals, of which 32 were financed for a
total of €21 million: 11 in the Balkans, eastern Europe and central Asia; four in the
Southern Mediterranean/Middle East region, four in the ACP countries, five in Asia
and eight in Latin America.

5.2.3.

Prevention of torture and support for the rehabilitation of victims of torture

The  EU  Charter  of  Fundamental  Human  Rights  stipulates  that  no  one  can  be
subjected  to  torture  or  inhuman  or  degrading  treatment.  In  April  2001  the  Council
adopted  guidelines  for  EU  policy  for  non-member  countries.88  The  EIDHR
objectives  include  reducing  the  incidence  of  torture,  improving  implementation  of
international standards in non-member countries and improving the quality of aid for
rehabilitation  centres  and  institutional  capacity.  The  2002  call  for  proposals  led  to
141  proposals,  24  of  which  were  financed  for  a  total  of  €17.8  million:  eight  in
Europe, three in the Southern Mediterranean, two in Latin America, five in the ACP
countries  and  one  of  global  scope  (€12.7  million).  In  addition,  five  projects  were
financed under  the  B5-813  heading  for  rehabilitation  centres  in  EU  Member  States
(€5.1 million).

5.2.4.

Action against impunity and promotion of international justice

In 1996 Parliament created a specific budget heading (B7-702) to support the United
Nations’ tribunals  for Rwanda and  for the  former  Yugoslavia  and  the  setting-up  of
the  International Criminal Court.89  The  call  for  proposals  elicited  70  responses,  of
which three of global scope were financed for a total of €3 518 169.

5.2.5.

Support for democratisation, good governance and the rule of law

The  fifth  call  for  proposals,  issued  in  July  2002,  concerns  29  target  countries
mentioned  in  the  2002-2004  EIDHR  programming  document.90  For  each  country
there a fact was annexed sheet setting out the specific objectives and the results to be

88

89

90

They  stress that:  “Combating and  preventing  torture  and  ill  treatment  will  be  considered  a  priority  in
bilateral and multilateral cooperation for the promotion of human rights, inter alia in collaboration with
civil society, including the legal field and the field of training. Particular attention  should be given to
such cooperation within the framework of the European Initiative for Democracy and Human Rights”.
The Statute of the International Criminal Court entered into force on 1 July 2002.
Algeria, Bosnia-Herzegovina, Burundi, Cambodia, the West Bank and Gaza, Colombia, Côte d’Ivoire,
Eritrea,  Ethiopia,  Fiji,  Georgia,  Guatemala,  Haiti,  Indonesia,  Israel,  Mexico,  Mozambique,  Nepal,
Nigeria, Pakistan, Democratic Republic of the Congo, Federal Republic Yugoslavia, Russia, Rwanda,
Sierra Leone, Sudan, Tunisia, Turkey, Ukraine, and Zimbabwe.

88

                                                
achieved. The 573 proposals received will be evaluated and selected for financing in
2003.91

Twelve  projects  from  the  reserve  list  set  up  following  the  2001  call  for  proposals
were also financed for a total of €7.5 million: these projects concern Algeria, Israel,
the Democratic Republic of the Congo, Sierra Leone, Burundi, Cambodia, Indonesia,
Pakistan, the Philippines, Colombia, Russia and Turkey.

Targeted  projects:  procedure  systematically  used  for  projects  drawn  up  with
international  and  regional  organisations,  including  the  specialised  agencies  of  the
United Nations and the Office of High Commissioner for Human Rights, the Council
of Europe and the OSCE-ODIHR. They are identified by the European Commission
as serving specific objectives which cannot be achieved with calls for proposals. All
the  projects  financed  under  this  heading  have,  in  line  with  the  programming
document, mainly concerned support for democratisation, good governance and the
rule  of  law.  In  2002  51  projects  were  financed  for  a  total  of  €41.3  million  in  the
following fields.

5.2.5.1 Strengthening the capacity of civil society

A worldwide project costing €1 762 400 was approved to better protect and promote
human rights in countries which ratified the  relevant international instruments.  It is
carried  out  with  the  Office  of  High  Commissioner  for  Human  Rights  and  will
encourage  the  participation  of  local  actors  in  drawing up  reports  and  implementing
the Conventions. It will thus intensify the involvement of civil society in the work of
bodies  set  up  by  the  Conventions.  Other  projects  were  approved  which  will  be
implemented in Russia, the Balkans, Africa, Latin America and Asia.

5.2.5.2 Education and training in human rights

The  EIDHR  financed  the  continuation  of  the  Master’s  in  human  rights  and
democratisation  for  36  students  from  Palestine,  Lebanon,  Malta,  Libya,  Egypt,
Algeria,  Tunisia,  Morocco,  Turkey,  Cyprus,  Jordan  and  Israel.  Other  projects  were
approved which will be implemented in Russia, the Balkans and Latin America.

5.2.5.3 Support for elections

In 2002 the EIDHR spent some €14 million on election support. At the request of the
governments  concerned,  it  financed  EU  election  observer  missions  in  Kenya,
Cambodia,  Madagascar,  Ecuador,  Pakistan,  Sierra  Leone,  East  Timor  and  Congo.
Support was also give to the OSCE/ODHIR election observer mission for the general
elections in the former Yugoslav republic of Macedonia. A decision had been taken
to  finance  an  EU  election  mission  for  the  general  elections  in  Nepal  scheduled  for
November  2002  but,  owing  to  the  postponement  of  the  elections,  it  was  cancelled.
The  funds  for  an  EU election  observer  mission  in  the  Palestinian  territories  of  the
Gaza  Strip  and  the  West  Bank  were  committed,  and  the  mission  will  be  deployed
when conditions allow. A civics programme for communities in these territories was

91

See  the  list  of  all  proposals  submitted  at  http://europa.eu.int/comm/europeaid/projects/eidhr/calls-for-
proposals/cfp-state-of-play-general-call-
annex_en.pdfhttp://europa.eu.int/comm/europeaid/projects/eidhr/calls-for-proposals/cfp-state-of-play-
general-call-annex_en.pdf .

89

                                                
also  approved.  In  Colombia  and  Jamaica  two  projects  were  approved  to  strengthen
the participation of civil society in free and fair elections.

5.2.5.4 Legal system and institutional capacity building

A  joint  programme  of  the  Council  of  Europe  and  the  European  Commission  to
strengthen  democracy  and  the  rule  of  law  will  support  six  projects  for  a  total  of
€3.3 million;  these  projects  are  designed  to  promote  the  independence  of  the
judiciary  and  a  more  humane  prison  system.  Other  projects  were  approved  for  the
Democratic Republic of the Congo, Fiji, Haiti and Iran.

5.2.5.5 Good governance

A  worldwide  project  costing  €1.5  million  was  approved  to  develop  tools  and
methods  that  will  improve  reports  on  human  rights  and  the  evaluation  of  good
governance and democracy. Other projects were approved in the Balkans, Zimbabwe
and Ethiopia.

5.2.5.6 Conflict prevention and dealing with the aftermath of conflict

In  2002 the EIDHR  supported  five  projects in Africa and one project  in  the  Andes
region. It also funded the regional offices of the International Criminal Tribunal for
the former Yugoslavia. €1.2 million will go to a worldwide pilot project to establish
an  informal  network  of  national  organisations  responsible  for  civilian  staff  training
throughout the EU; the existence of well trained civilian experts ready to be deployed
within a short time will be vital for EU’s capacity to undertake the complete range of
conflict  prevention  activities  and  crisis  management  in  the  framework  of  the
European  security  and  defence  policy.  In  the  context  of  promotion  of  international
justice,  the  EIDHR  supported  two  projects  for  the  setting-up  of  the  International
Criminal Court.

5.2.5.7 Microprojects

Microprojects are a way of financing democratisation activities at a cost of between
€3 000 and €50 000. The aim is to top up aid for initiatives of local civil society and
to  strengthen  their  contribution  to  the  democratic  process.  They  are  designed  to
increase  mutual  understanding  and  a  sense  of  local  “ownership”.  They  will  be
selected  after  a  local  call  for  proposals  and  managed  directly  by  the  Commission
delegations (devolution of powers) in the countries listed below.

90

Country

Amount in €

Algeria

Bosnia-Herzegovina

Colombia

Ethiopia

Indonesia

Côte d’Ivoire

Mexico

Russia

Tunisia

Turkey

Ukraine

5.3

EQUALITY BETWEEN WOMEN AND MEN

TOTAL

500 000

500 000

500 000

400 000

800 000

400 000

500 000

1 000 000

250 000

600 000

600 000

6 050 000

Gender equality is crucial for sustainable development and poverty eradication. The
main operational framework for ensuring that the gender dimension is mainstreamed
in all EC development cooperation initiatives remains the Programme of Action for
the  Mainstreaming  of  Gender  Equality  in  Community  Development  Cooperation,
adopted in June 2001.92 This outlines a number of measures aimed at preventing the
well-known  phenomenon  of  ‘gender  policy  evaporation’  (that  is,  a  gap  between
policy statements and implementation). Whilst a number of interventions have been
initiated  since  the  Commission  adopted  this  Programme  of  Action,  progress  with
implementation  has  been  constrained  by  the  lack  of  appropriate  human  resources
needed for this rather ambitious work programme. However, positive developments
took  place  in  2002.  Two  significant  measures  were  initiated  by  the  EuropeAid
Cooperation Office and will be fully implemented in 2003: (a) drafting of a concise
manual setting out the essential principles and guidelines for gender mainstreaming,
(b)  the  setting-up  of  a  vast  training  programme  for  staff  in  both  Commission
Headquarters and Delegations, including staff of beneficiary countries.

Within  the  Commission  a  coordinating  group  has  been  established.  Meetings  are
convened on a regular basis to exchange experiences and expertise on methodology
and  instruments  for  implementation  of  the  Programme  of  Action.  In  2002,  the
Commission also took steps to improve coordination and cooperation with Member
States. An existing network of gender experts from Member States was reorganised
and relaunched at a meeting in June 2002. Objectives under discussion mainly relate

92

COM(2001) 295.

91

                                                
to sharing experiences in the field of gender mainstreaming. The Commission is also
working  to  introduce  gender  equality  considerations  in  new  areas.  In  the  course  of
the  year  the  Commission  participated  in  innovative  policy  initiatives  on  gender
equality  with  respect  to  trade  relations  (in  particular  as  part  of  the  Commission’s
work  on  sustainability  impact  assessments  for  trade  agreements),  corporate  social
responsibility and core labour standards and labour relations.

5.4

COMBATING DRUGS

A negative consequence of the fall of the Taliban regime in Afghanistan in late 2001
was  that  the  country  resumed  its  role  as  the  world’s  main  producer  of  opium  and
heroin.  The  Commission’s  efforts  in  2002  were  mainly  aimed  at  reducing  the
cultivation  of opium and the production  of  heroin in Afghanistan. This was  part  of
the efforts to support the rebuilding of the country and its rural economy. Projects for
a  total  of  nearly  €40  million,  financed  through  the  corresponding  geographical
budget line, were devoted to poppy-growing areas in the country. The emphasis was
on support to rural recovery, which should help promote rural economic growth and
provide  farmers  with  sustainable,  alternative  livelihoods  to  poppy  production.  To
enhance  Afghanistan’s  institutional  capacity  to  tackle  drugs,  technical  support  was
provided  to  the  Counter  Narcotics  Department  of  the  National  Security  Council,
through the financing of a drug expert.

To  complement  these  actions  in  Afghanistan,  the  Commission  has  continued  to
strengthen  its  initiatives  in  the  NIS  region,  particularly  Central  Asia.  As  part  of  its
Central  Asia  Drug  Action  Programme,  the  Commission  provided  financing  of
€4.5 million for inter alia an EU drug regional coordination office, the establishment
of  National  Anti-Drug  Information  Networks  and  an  Airport-Seaport  Control
project,.  Parallel  programmes,  which  cover  both  demand  and  supply  control,  were
financed  with  a  contribution  of  €4,5  million  in  the  Southern  Caucasus  and  in
Belarus/Ukraine/Moldova.  These  programmes  are  all  financed  by  the  TACIS
Programme, which is also supporting Russia’s and Ukraine’s anti-money laundering
efforts.

Still in Asia, a major project for a value of €5 million, financed by the corresponding
geographical budget line, was signed in December 2002 to support the fight against
HIV/AIDS in Myanmar.  The  drug  component of this project will focus  on  demand
prevention  and  harm  reduction  of  drug  abuse  in  institutional  and  non-institutional
settings.

As  for  the  cocaine  route,  support  to  Colombia  has  remained  the  main  Commission
priority. A major project called the Peace Laboratory in the Magdalena Medio, which
provides for Commission financing of €34.8 million over eight years, was launched
in  March  2002.  The  Commission  also  supports  the  improvement  of  cartographic
knowledge  in  Colombia  so  as  to  enable  the  government  to  better  identify  the  coca
and  poppy  growing  areas.  Efforts  are  also  being  made  in  Bolivia  and  Peru,  all
financed  by  the  corresponding  geographical  budget  lines.  The  overall  aim  of  the
projects in this region is to reduce, and eventually eliminate, farmers dependence on
growing coca as well as to discourage people from neighbouring areas to migrate to
these regions. In Bolivia, the second phase of the project on alternative development
in mining regions will receive Commission support amounting to €7 million over six
years.

92

Due  to  the  small  allocation  of  €1.6 million  to  the  horizontal  drugs  budget  line  for
2002, only one project could be financed. It focuses on the Andean region and will
finance activities to prevent the diversion of chemical precursors to the manufacture
of cocaine and heroin. The project aims to increase the awareness of administrative
authorities and chemical industries and improving their cooperation in preventing the
diversion of chemical precursors as well as the cooperation with the EU in this field.

5.5

THE ENVIRONMENT AND TROPICAL FORESTS

There  is  a  growing  international  consensus  on  the  links  between  poverty  and  the
environment. In fact, environmental problems are a significant cause of poverty, and
generally  hit  the  poor  hardest.  On  the  other  hand  the  poorest  often  contribute  to
environmental  deterioration  due  to  a  lack  of  alternatives.  Deteriorating  agricultural
lands, shrinking forests, diminishing supplies of clean water, dwindling fisheries, and
the  threat  of  growing  social  and  ecological  vulnerability  from  climate  change  and
variability  and  loss  of  biological  diversity  have  the  most  severe  impacts  in  the
developing world where most of the poor live. Better environmental management is
therefore essential to lasting poverty reduction.

In order to address these issues, the Commission participated in 2002 in the Poverty
and  Environment  Partnership  with  a  number  of  other  donors  and  agencies.  Two
concrete  products  of  this  partnership  were  a  paper  on  “Linking  Poverty  Reduction
and  Environmental  Management”,  which  was  presented  at  the  World  Summit  in
Johannesburg  in  September  2002,93  and  a  similar  but  more  specific  document  to
analyse the linkages between poverty and climate change, the first draft of which was
presented at the 8th Conference of the Parties in Delhi in November 2002. These joint
papers seek to draw out the links between poverty and the environment and poverty
and  climate  change  respectively.  They  also  aim  to  demonstrate  that  sound  and
equitable  management  of  the  environment  is  integral  to  achieving  the  Millennium
Development  Goals,  in  particular  to  eradicating  extreme  poverty  and  hunger,
reducing  child  mortality,  combating  major  diseases,  and  ensuring  environmental
sustainability. The papers also present measures that can be taken at both the national
and the international level to reduce poverty and enhance environmental quality.

Over the year, the Commission also developed a draft Communication that set out a
strategy and an Action Plan for the Integration of Climate Change into Development
cooperation,  which  has  now  been  adopted.  Through  this  Action  Plan,  the
Commission  will  propose  measures  to  be  taken  by  the  Commission,  the  Member
States, partner countries and other stakeholders in order to enhance the resilience of
partner countries to climate change and variability.

Furthermore the Commission, on behalf of the Community, submitted in May 2002
to the Secretariat of the UN Convention to Combat Desertification the Report on EU
activities carried out in 2000-2001 in support of the preparation and implementation
of action programmes under the Convention.

Mainstreaming  is  also  a  question  of  ongoing  awareness-raising  and  persuasive
activities  to  enhance  in-house  capacity  and  the  partner  countries’  knowledge  of
environmental  issues  so  that  they  are  tackled  on  a  routine  basis.  To  this  end,  a

93

http://europa.eu.int/comm/development/doc/brochure_linking_poverty_en.pdf.

93

                                                
document  summarising  the  various  Multilateral  Environmental  Agreements  and
opportunities for  cooperation  deriving from  them  has been  finalised. Moreover, the
“mainstreaming” message has been conveyed through various channels, in particular
by active participation in international negotiations, the organisation of consultation
and  coordination  meetings  and  input  into  EC  draft  legislation  having  an  impact  on
the environment in developing countries. Further work was also done to mainstream
environment in the Country and Regional Support Strategies. A review of 60 CSPs
undertaken  in  2002  highlights  the  fact  that  environmental  issues  are  not  yet
consistently addressed in these CSPs/RSPs.

5.5.1

Horizontal activities in the field of environment

In  2002  new  environmental  projects  for  a  total  of  €8.5  million  were  approved  for
financing under the budget line for environment in developing countries. Information
on  those  projects  that  have  a  geographical  focus  is  given  under  the  respective
geographical  chapters.  In  addition  ,  a  number  of  global  projects  are  supported  in
close cooperation  with  international organisations. These projects  aim  to  contribute
to improved capacity in developing countries to analyse and cope with the interaction
of  trade  and  environment,  and  with  the  impact  of  climate  change;  to  cleaner  air  in
cities  of  the  developing  countries;  to  improved  biodiversity  conservation;  and  to
better management of environmental resources.

5.5.2

Forests

Forests  formed  an  important  part  of  the  Commission’s  contribution  to  the
Johannesburg  World  Summit  on  Sustainable  Development  (WSSD),  and  the  sector
has been identified as a priority for post-Johannesburg follow-up. The Commission is
taking an active role in helping to shape two major partnerships for forests that were
launched  at  the  WSSD:  the  Asia  Forest  Partnership  and  the  Congo  Basin  Forest
Partnership. The Commission is also examining how best to support a second phase
of the Pilot Programme to Conserve the Brazilian Rainforest. These three initiatives
are  an  integral  part  of  the  EC’s  post-summit  strategy.  Together,  they  address  the
three greatest remaining tracts of tropical forest in the world and the richest forests in
terms of biodiversity, where forests are a valuable source of income to rural people
and  where  the  poverty-environment  interface  at  the  centre  of  the  Johannesburg
summit is so evident.

In  Johannesburg,  the  Commission  hosted  a  side  event  on  illegal  logging,  which
brought  together  ministers  and  senior  officials  from  key  wood-producing  and
wood-consuming  countries  to  affirm  their  commitment  to  address  this  important
issue.  In some  countries,  illegal  logging  has  become  such  a  serious  problem  that  it
weakens the rule of law and principles of good governance in specific areas, and so
jeopardises  the  wider  objectives  that  the  Commission  hopes  to  achieve  through  its
trade relations and development cooperation programmes. To  address this problem,
the  European  Commission  is  currently  developing  an  Action  Plan  for  Forest  Law
Enforcement, Governance and Trade, which should be finalised in 2003.

The European Commission is also actively supporting complementary initiatives for
Forest  Law  Enforcement  and  Governance  in  Asia  and  Africa.  These  initiatives  are
designed to build strong local political commitment to address the underlying causes
of illegal logging in wood-producing countries.

94

5.5.3

Horizontal activities in the field of forestry

In 2002, new forest-related projects for a total budget of 39.4 million were approved
for  financing  under  the  budget  line  for  environment  in  developing  countries  and
tropical forests. Information on those projects that have a geographical focus is given
under the respective geographical chapters. In addition to these, a number of projects
with a global nature are supported in close cooperation with internationally-operating
organisations.  These  projects  will  contribute 
inventories  and
conservation  of  biological  resources;  to  more  sustainable  management  practices  in
important  forest  complexes;  to  the  introduction  of  sustainable  management  of
bamboo into South America by transferring experience from Asia, and to the African
Forest Law Enforcement and Governance process.

improved 

to 

5.6.

CONFLICT  PREVENTION,  RAPID  RESPONSE  TO  CRISIS  AND  FIGHT
AGAINST TERRORISM

5.6.1. Conflict prevention

Conflict prevention is not a ‘sector’ for intervention in the traditional sense. Instead a
conflict-sensitive  approach  is  required  in  all  external  assistance  programmes,  and
indeed in other areas such as economic, trade and environment policy and diplomatic
activity. In parallel, funding is needed for specific activities targeting the prevention
or alleviation of conflict situations. In 2002 the Commission continued to implement
this  strategy  for  conflict  prevention,  which  was  first  set  out  in  an  April  2001
Communication.94

The Commission’s Country and Regional Strategy Paper process is a vital means by
which to ensure “mainstreaming” of a conflict prevention approach. Mainstreaming
is  dependent  upon  appropriate  resources  and  training  being  made  available  to
geographical services.  In 2002, the main resource was the set of conflict  indicators
(the so-called “check-list of root causes of conflict”). This check-list looks at issues
such  as  the  balance  of  political  and  economic  power,  the  control  of  the  security
forces, the ethnic composition of the government for ethnically-divided countries, the
Human Rights situation, the potential degradation of environmental resources and so
forth.

Using these indicators, geographical services completed country conflict assessments
for  more  than  120  countries.  Desk  officers  and  Delegations  have  so  far  expressed
satisfaction  over  the  usefulness  of  this  tool  and  it  has  been  an  effective  means  for
raising awareness of the conflict prevention approach.

Country conflict assessments served to draw attention to conflict prevention-focused
activities that should be targeted by external aid. In programming assistance (in the
CSP/RSP section dealing with the “EC response strategy”), the Commission has put
more emphasis on strengthening the rule of law, support for democratic institutions
(e.g. election monitoring), development of civil society, reform of the security sector
and specific post-conflict measures. These sectors of intervention were identified in

94

Communication  from  the  Commission  on  Conflict  Prevention,  Brussels  11.4.2001  COM(2001)  211
final.

95

                                                
the  conflict  prevention  communication  as  key  to  supplanting  conflict  or  preventing
its re-emergence.95

As the CSP process is not yet finalised, it is difficult to present reliable statistics at
this stage. CSPs were not finalised for some countries and regions which have been
troubled  by  some  of  the  most  complex  conflicts  (Sri  Lanka,  Angola,  Afghanistan,
Central  Asia,  etc.).  They  will  undoubtedly  have  a  strong  conflict  prevention  focus.
But it is notable  that  for example, in the  ACP  region,  under  the  new  9th  European
Development  Fund,  programmes  in  most  countries  where  CSPs  were  finalised  in
2002 have included support relevant to areas such as good governance, institutional
capacity building, rule of law, civil society and the judiciary.

There are also earmarked funds from other sources for non-focal sector interventions
to support activities in the field of conflict prevention. A case in point is that of the
Regional  Strategy  Papers  which  also  attempted  to  include  conflict  prevention  as  a
significant  intervention  sector.  The  West  Africa  Regional  Strategy,  for  example,
makes  support  (tentative  global  allocation  of  €5  million)  for  regional  conflict
prevention  and  good  governance  a  non-focal  sector  involving  confidence  building
activities and strengthening the capacity of subregional organisations. These regional
approaches will be able to build on the EC programme in support of African Union
peace-building and transition activities which has been under preparation. The aim is
to  target  the  operational  activities  of  the  Peace  and  Security  Council,  including
special  envoys,  mediation/facilitation  activities  and  AU  elections  observations.
Similarly,  the  European  Initiative  for  Democracy  and  Human  Rights  has  been  a
source of support for regional conflict prevention activities.

In  other  cases,  it  has  been  more  appropriate  to  incorporate  measures  targeting
conflict  prevention  in  sectoral  programmes  in  fields  as  diverse  as  transport,  rural
development,  energy,  environment,  health  research  and  education.  As  an  example,
the  CSP  for  Papua  New  Guinea,  states  that  regions  affected  by  the  recent  conflict
(Bougainville) will have to receive a fair share of the funds earmarked for education,
rural water supplies and good governance programmes.

As a way of helping geographical departments to mainstream conflict prevention in
programming, the Commission also launched the concept of “deployment of conflict
prevention  teams”.  This  allows  the  deployment  in  a  given  country  or  region  a
multidisciplinary  team  of  independent  experts,  with  horizontal  competence  in
anthropological/historical,  security,  governance,  development  or  regional  issues.
Those  experts,  drawn  from  a  wide  variety  of  backgrounds,  are  asked  to  bring  a
complete picture of potential conflict issues and to propose a medium term conflict
prevention strategy to be integrated into existing and planned cooperation activities
(in the framework defined by the Country Strategy/Regional Strategy paper).

In  2002,  utilising  the  Rapid  Reaction  Mechanism,  such  conflict  prevention  teams
were  deployed  to  Nepal,  Indonesia  and  three  South  Pacific  States.  The  timing  of
these missions was intended to ensure that a rigorous analytical input on the conflicts
in these countries was included in the respective country and regional strategies. Due

95

These sectors are also consistent  with  the  sixth  priority  area  for  EC  development  policy:  rule  of  law,
good governance and institutional building.

96

                                                
to  unstable  situations  there,  the  missions  were  also  mandated  to  identify  possible
short-term measures to address immediate needs.

The culture of conflict prevention needs to be further rooted in the day-to-day work
of  the  Commission  services.  In  this  respect,  seminars  and  workshops  on
mainstreaming  of  conflict  prevention  or  on  specific  conflict  issue  are  arranged  to
ensure  adequate  expertise  within  delegations  and  geographical  services  of  the
Commission.  Work  is  ongoing  to  further  develop  training  opportunities  and
programming guidelines to meet desk officer needs.

5.6.2.

The Rapid Response to Crisis

As part of a  wider effort  to  improve  flexibility  and  speed  of  response  to  crisis,  the
Rapid  Reaction  mechanism  (RRM)  was  established  in  2001.96  It  enables  the
European  Community  to  respond  in  a  timely  manner  to  the  needs  of  countries
undergoing  crisis  situations  (man-made  or  natural).  Its  main  purpose  is  to  support
short-term (maximum duration six months) civilian measures aimed at safeguarding
or  re-establishing  the  conditions  under  which  the  EC  partner  countries  can  pursue
their longer-term development goals.

The 2002 RRM programme (budget €25million) provided assistance in the following
fields:97

– 

– 

– 

– 

– 

assessment of possible Community responses to a crisis. In 2002 a number of
technical  assessment  missions  were  launched  to  assess  the  situation  on  the
ground and provide information enabling the Commission’s policy making and
planning.

preventive  action  during  emerging  crises.  Based  on  assessment  missions
financed 
conflict
has 
prevention/mitigation programmes in Indonesia and Nepal;

programmed 

the  RRM, 

launch 

the 

by 

acute  crisis  management.  The  RRM  has  supported  mediation  efforts  in
developing  crises,  for  example  in  Côte  d’Ivoire  and  the  Central  African
Republic;

post-conflict  reconciliation.  Confidence-building  measures  in  support  of  an
emerging  or  established  peace  process.  These  actions  have  included  direct
in  Aceh),
support 
information/media support and measures to strengthen civil society.

to  peace  agreement  monitoring 

(for  example 

post-crisis  reconstruction.  With 
in
Afghanistan  as  an  example,  these  actions  spearhead  long-term  Community
cooperation  programmes  in  the  immediate  aftermath  of  a  war  or  other
emergency, supporting the re-establishment of civil administration and the rule
of law, as well as subsequent rehabilitation and development programmes.

the  second  emergency  programme 

96

97

Regulation EC 381/2001 of 26 February 2001.
More details are included in the section 6, Activities in 2002.

97

                                                
Rapid Reaction Mechanism, 2002 (in €)

Commitment
appropriations

Committed

Committed
%

Payments
appropriations

Payments
made

Payments
%

25 000 000

23.510.251

96.5

30.800 000

26.074.499

85.5

RRM Programme 2002

€ million

Administrative Management, all countries

Policy Advice, Mediation Facility, all countries

Afghanistan Stabilisation II

Peace building, Horn of Africa

Palestinian Territory, Reconstruction

Conflict mitigation, Nepal

Peace building, Sri Lanka

Support to Cessation of Hostilities, Aceh, Indonesia

Total

2.25

3.00

5.95

2.60

5.00

0.62

1.80

2.30

23.5

Considering  the  short-term  nature  of  the  RRM  crisis  assistance,  it  is  clear  that  this
support  must  not  contradict  the  longer-term  development  objectives  and  activities.
The  need 
longer-term  development,
rehabilitation,  stabilisation  and  reconstruction  has  long  been  promoted  by  the
Commission98  and  strong  efforts  are  made  by  the  RRM  to  ensure  the  necessary
linkage to EC overall development and external assistance programmes

link  short-term  relief  assistance 

to 

to 

Although  the  RRM  programme  is  managed  by  the  Crisis  Management  Unit,  early
involvement  of  other  relevant  services  in  the  Commission  is  standard  procedure.
Often  the  use  of  RRM  is  triggered  by  the  country  desk  officers,  coordinating  EU
development  activities,  or  by  the  Delegation  in  the  respective  countries.  Even  in
situations  where  there  is  no  direct  initiation  from  these  partners,  their  immediate
involvement  in  the  design  of  the  operations  is  arranged  on  a  routine  basis.  The
Commission Delegations often play a key role in coordinating with other donors and
they normally also ensure the direct monitoring of the actions in the field.

There are usually three types of linkages between the RRM activities and major EC
Development, Rehabilitation and Reconstruction efforts.

– 

– 

Preparations for large-scale EC actions. For example, in post-war Afghanistan
the RRM financed capacity building of the ministries that would subsequently
implement longer-term and larger-scale Commission reconstruction assistance.

Implementation of the first stages of major EC efforts. Many RRM activities in
the former Yugoslav Republic of  Macedonia  (financed  from  the  2001  budget
but implemented in 2002) were continued in the CARDS programme and taken
over by the European Agency for Reconstruction (EAR).

98

COM/2001/0153 final.

98

                                                
– 

Integration  of  a  Crisis  and 
its  economic,  social  and  environmental
consequences  into  EU  development  programming  (Country  Strategy  Papers).
The  findings  of  the  conflict  prevention  missions  and  the  subsequent  RRM
follow-up  measures  (indicated  above)  have  enabled  the  EC  development
projects,  notably  in  Nepal,  to  better  integrate  the  consequences  of  the  civil
unrest into their actions, both on programming and field implementation level.

5.6.3.

Assistance to non-member countries in the fight against terrorism

With  regard  specifically  to  the  prevention  of  terrorism,  the  Commission  has
identified  a  significant  number  of  existing  technical  assistance  projects  and
programmes  which  contribute 
to
counter-terrorism,  thereby  meeting  some  of  the  provisions  of  UN  Security  Council
Resolution  1373  on  the  fight  against  terrorism.  In  March  2002  the  Commission
provided a factual overview of such existing programmes.99

to  capacity  building 

in  areas 

relevant 

The  Commission  also  began  developing  additional,  more  focused  assistance  in
response to the General and External Affairs Council Conclusions of 22 July 2002,
which put a strong emphasis on the need for the EU to assist non-member countries
in implementing their obligations under UNSCR 1373.

through 

The  Council  requested  consideration  of  pilot  projects  that  could  be  launched  in  a
few  countries.  The  conclusions  implicitly  invite  the  Commission,  as  the  main
the  relevant
provider  of  assistance,  “to  consider  further  actions 
programmes”.  Countries  for  such  pilot  projects  were  chosen on  the  basis  of  agreed
criteria,  including:  relevance  to  the  fight  against  terrorism;  relevance  to  the  EU’s
foreign policy; need for and willingness to accept assistance and the existence of an
EC  comparative  advantage.  During  2002,  this  led  to  a  mission  to  Philippines  and
also planning of missions to Pakistan and Indonesia in early 2003. The aim was to
identify  specific  measures  in  the  areas  of  terrorist  financing,  law  enforcement  and
judicial reform. In each case the assessment was coordinated with EU Member States
who  would  be  able  to  take  the  findings  into  account  in  their  own  assistance
programmes  and  so  ensure  overall  EU  coherence.  Modification  of  existing
programmes and the possibility of additional actions in other countries according to
the same criteria will be considered.

5.7.

SCIENCE  AND  TECHNOLOGY  COOPERATION  –  POLICY  DIALOGUE
AND CAPACITY BUILDING

Since  the  early  1980s  the  European  Community  has  been  supporting  research
cooperation in the field of scientific and technological (S&T) development between
institutions  in  the  Member  States  and  their  counterparts  in  developing  countries  in
Asia, Africa, the Mediterranean Basin and Latin America.

This  cooperation  is  part  of  the  Community’s  wider  international  research  and
technological development cooperation programme and is complementary to the aid
programmes.  It  covers  research  on  sustainable  crop,  livestock  and  fish  production

99

Summarised in a Commission staff working paper that has been made available to Member States and
submitted to the United Nations. SEC(2002) 231 ‘EC external assistance facilitating the implementation
of UN Security Council Resolution 1373: an overview’ 25 February 2002
 http://www.un.org/docs/sc/committees/1373/EC.

99

                                                
and processing, human health  and  the sustainable management of  natural  resources
in developing countries. Most were also relevant to aspects of food security.

The  role  of  S&T  cooperation  is  irreplaceable  in  developing  the  knowledge  to
promote  socio-economic  development  and  global  competitiveness.  The  global
partnership  covers  not  only  research  projects  but  also  research  fellowships  for
training and support for the organisation of workshops. This enables interaction and
exchanges  on  regulatory  and  policy  matters.  The  expertise  gained  contributes  to
better  national  strategies,  plans,  policies  and  processes  for  achieving  sustainable
development

The  evolution  of  scientific  cooperation  programmes  between  the  EU  and  the
developing  countries  made  it  easier  to  draw  up  a  Community  strategy;  one  was
adopted  by  the  European  Council  in  1997  which  lays  the  foundations  for  greater
coherence  and  complementarity  between  Community  development  and  research
policies.

For  the  World  Summit  on  Sustainable  Development  in  August/September  2002,
Johannesburg, South Africa, the international S&T cooperation programme prepared
and disseminated,  in collaboration  with the other  Commission  Directorates-General
involved  with  external  policies,  four  brochures  on  10  years  of  EC  scientific
cooperation on the transition towards sustainability – entitled “Capitalising on people
and  institutions”,  “Managed  land  ecosystems”,  “Aquatic  ecosystems”  and  “Healthy
societies”.

The  6th  Framework  Research  Programme  was  launched  officially  at  a  major
international conference in November 2002 that attracted hundreds of delegates from
developing  and  emerging  economies.  Specific  activities  under  the  8th  international
cooperation  priority  focus  on  food  security,  health  issues  and  the  management  of
natural resources in partner  regions,  all  of which  are  crucial to  creating  wealth  and
starting  to  meet  the  Millennium  Development  Goals.  Sustainability  and  the
“knowledge  society”  will  be  important  parts  of  the  new  Framework  Programme,
which is open to international participation in all its priority themes with earmarked
funding  for  developing  country  partners.  The  intention  is  to  mobilise  on  a  global
scale  the  critical  mass  of  expertise  needed  to  achieve  ambitious  objectives.  The
consolidation  of  the  European  Research  Area  open  to  the  world  will  create  a  vast
intellectual, scientific and cultural “space”, which the European Union is willing to
share  with  other  countries  and  regions  for  the  benefit  of  sustainable  and  equitable
development.100

5.8

HEALTH, AIDS AND POPULATION

The scale of the development challenge in this area and the policy framework for the
Community’s interventions have already been outlined in Chapter 3 of this report.

The  Community  has  two  horizontal  budget  lines  that  it  can  draw  on  to  reinforce
action  undertaken  through  country  and  regional  programmes:  B7-6311  (Aid  for
Poverty-Related Diseases in Developing Countries) and B7-6312 (Aid for Population
and  Reproductive  Health  Care).  In  2002  the  Commission  programmed  support  to

100

Details  on  collaborative  research  programmes  supported  by  the  international  cooperation  (INCO)
component of the framework programme can be found on www.cordis.lu.

100

                                                
innovative initiatives in the fields of HIV/AIDS and sexual and reproductive health
and  rights  (S&RHR)  under  these  budget  lines.  Areas  where  there  had  been  little
progress  towards  achieving  the  relevant  Millennium  Development  Goals  and  other
international  targets  were  prioritised.  For  HIV/AIDS,  the  Commission  focused  on
prevention, linked with treatment and care of the  young population in the countries
most affected.  A number of  proposals related  to  innovative  interventions  were  also
selected.  Other  areas  programmed  were  preparedness  work  for  the  AIDS  vaccine,
regional  networking  such  as  the  Asia  Pacific  Leadership  Forum.  Priority  was  also
given  to  interventions  aimed  at  reducing  maternal  mortality  and  initiatives  for  the
prevention of Female Genital Mutilation.

In  2002,  the  Commission  reformulated  the  two  Regulations  for  the  special  budget
lines  B7-6311  and  B7-6312,  and  they  were  thoroughly  discussed  in  Council  and
Parliament.  Significant  achievements  for  the  latter  Regulation  were  the  agreement
reached at EU level to uphold the principles of the Programme of Action adopted at
the International Conference on Population and Development held in Cairo in 1994.
The Commission proposed substantial financial increases for both Regulations. It is
expected  that  the  two  new  Regulations  will  be  adopted  by  Parliament  and  the
Council  at  the  beginning  of  2003.  This  would  allow  the  EU  to  take  concrete
measures  to  help  save  thousands  of  lives  by  improving  maternal  health,  and  by
contributing to the fight against diseases of poverty in some of the poorest countries
in the world.

If we add the increased R&D on clinical trials into these diseases (€200 million from
the Commission, €400 million expected from the Member States and other sources of
public  and  private  funds,  plus  a  further  €200  million  in  new  pre-clinical  research
projects under the Sixth Framework Programme for RTD 2002-2006, total financing
available for these initiatives is over €1.2 billion.

5.9

COOPERATION WITH NON-STATE ACTORS INCLUDING NGOs

Non-state actors are gradually becoming one of the key partners in the Community’s
development  cooperation  policy.  It  is  recognised  that  broad  dialogue  between
institutions and citizens provides the possibility for valuable input into the design and
implementation  of  poverty  reduction  strategies  and  policies  centred  on  the
Millennium  Development  Goals 
also  promotes  good  governance,
and 
democratisation and respect for human rights. NSA participation is mainstreamed in
all  thematic/horizontal  budget  lines  and  geographical  instruments.  NSAs  can  either
carry out projects/programmes that implement directly the CSPs and/or fit in with the
sectoral and geographical priorities set by the Commission (in which case they act as
“implementing partners”), or they can put forward their own initiatives/proposals for
Community financing (this is known as “NSA own initiative” support). Two specific
budget lines are dedicated to support NSAs’ initiatives:

– 

– 

cofinancing operations with EU non-governmental development  organisations
in
(NGOs)  (budget  heading  B7-6000),  which  covers  both  operations 
developing countries and operations to raise European public awareness; and

support  for  decentralised  cooperation  in  the  developing  countries  (budget
heading B7-6002).

101

In  2002,  the  Commission  prepared  a  Communication  on  the  Participation  of
Non-State  Actors  in  EC  Development  Policy.101  The  Communication,  which  was
adopted  in  November  2002,  clarified  the  Community’s  expectations  of  non-state
actors’  participation.  This,  in  turn,  has  helped  to  inform  debate  with  partner
countries.  The  Communication  illustrated  the  way  in  which  non-state  actors  are
increasingly  being  involved  in  the  Community’s  development  policy  through  the
various  cooperation  programmes  and  policy  dialogue  with  partner  countries.  The
Communication  also  recognised  the  need  for  the  Community  to  develop  a  flexible
and  differentiated  approach  that  can  ensure  an  adequate  level  of  consultation  and
participation  with  and  by  non-state  actors,  whilst  acknowledging  the  likelihood  of
differences between regions.

These  differences  are  partly  due  to  the  different  regional  frameworks  for  the
Community’s cooperation. The Cotonou Agreement, which provides the framework
for  relations  between  the  EU  and  African,  Caribbean  and  Pacific  countries,  is  the
only one in which the involvement of non-state actors is a legally binding obligation
for both parties.  In 2001 the Commission drew up jointly  with the ACP Secretariat
comprehensive  guidelines  to  assist  Commission  staff  and  National  Authorising
Officers working on programming for ACP countries in promoting the participation
of  non-state  actors.  A  quantitative  and  qualitative  analysis  of  Country  Strategy
Papers  was  undertaken  to  assess  the  extent  of  non-state  actor  participation  in  the
programming  process  and  progress  of  implementing  the  relevant  provisions  in  the
Cotonou  Agreement.  Although  the  results  were  encouraging,  this  analysis  did
identify a number of bottlenecks and challenges requiring further attention, which are
being addressed.

in 

the  conclusions  of 

intention  was  announced 

Building on the guidelines that were developed for ACP countries, the Commission
intends  to  develop  guidelines  for  staff  working  on  development  programmes  in  all
regions.  This 
the  2002
Communication and work has already begun. The new guidelines will complete and
clarify  some  aspects  of  the  programming  guidelines  produced  for  ACP  countries
(which remain valid). They will encourage and assist Community Delegations in all
regions to explore all possibilities for the gradual involvement of non-state actors in
the  development  process,  where  this  is  possible  with  the  authorities  of  the  country
concerned.  They  will  provide  advice  based  on  best  practice,  including  different
approaches  to  promote  confidence  building  and  trust  between  Governments  and
NSAs.  Guidelines  on  financial  decisions  and  financial  support  to  non-state  actors,
which relate to the different instruments, will be developed separately.

5.9.1

Assessment of Non-State Actors’ Participation in the Programming Process

As part of its work to assess progress in enhancing cooperation with non-state actors,
and in particular the provisions of the Cotonou Agreement regarding involvement of
non-state actors in the programming process, the Commission carried out an analysis
of 47 draft ACP CSPs approved and/or signed by November 2002.

This found that, in the vast majority of cases (45 countries), a process of consultation
was  conducted  with  non-state  actors.  It  also  suggested  that  the  Community’s
involvement could contribute to improving the quality of existing wider consultation

101

COM(2002) 598.

102

                                                
processes  (such  as  the  poverty  reduction  strategy  paper  -PRSP-  process).  In  some
countries innovative modalities have been applied and the programming process has
led to the creation of new functional bodies involving state and non-state actors. In
those cases, there is an evident concern for ensuring inclusiveness  (for example, by
opening-up  the  consultation  forums  to  new  members)  and  transparency.  In
27 countries,  the  draft  country  strategy  paper  was  modified  following 
the
consultation process.

The  analysis  also  found  that  different  types  of  strategies  have  been  adopted  to
involve NSAs in future cooperation. In a number of countries, the response strategy
is  geared  at  enhancing  NSA  participation  in  all  sectors  of  Community  cooperation
and by different means (mainstreaming). In others, provision for NSA involvement is
mainly in  the focal sectors.  A third  type  of strategy  proposes  to  provide  support  to
NSAs in non-focal sectors, either as a means for targeting poor population groups or
as  a  contribution  to  good  governance  and  conflict  prevention.  Out  of  the  three
possible sources of funding (access to funding, participation in the implementation of
focal or non-focal sector programmes, EC thematic budget lines) it is often unclear
which source is going to  be mobilised.  It is  also  often the case  that  a  provision for
direct  funding  is  provided  but  the  amount  proposed  is  not  precise.  However,  in
26 country programs a provision of direct funding for NSA capacity building or other
support is proposed. In total the proposed funds allocated directly to NSAs in those
countries  amount  to  approximately  €114.69  million  out  of  a  total  programming
envelope of approximately €2.8 billion. In only 15 countries102 the eligibility criteria
for  NSA  funding  have  been  discussed  with  the  NAO.  Finally,  36  of  the  47  CSPs
surveyed mention follow-up arrangements for future consultation and monitoring.

As  for  the  quality  of  the  consultation  process,  the  Commission  identified  key
questions  to assess the  progress  of  NSAs’  involvement  in  the  development  process
and to spot constraints and best practices to overcome them. Evaluations by NSAs in
the  South  and  the  inputs  from  EC  Delegations  provided  useful  assistance  for  this
exercise. Some of the key questions examined and the findings were as follows:

– 

– 

information provided to NSAs - this was given out late in some cases;

selection  of  participants  -  this  was  done  jointly  by  the  National  Authorising
Officer  and the  EC Delegation, or on  the  basis  of  a  study,  or  through  a  local
specialised NGO appointed to organise the consultation); and

– 

follow-up to the consultations - feedback was generally given to NSAs.

In  conclusion,  it  seems  that  important  attempts  have  been  made  by  all  parties
concerned  to  involve  NSAs  for  the  first  time  in  the  programming  process.  The
quantitative  outcomes  of  the  consultation  process  are  very  encouraging.  The  main
challenge for the future is to promote progressively structured forms of dialogue. The
rolling nature of the programming exercise will help to facilitate this.

102

Gambia,  Gabon,  Kiribati,  Jamaica,  St.  Lucia,  Chad,  Vanuatu,  Burkina  Faso,  Guyana,  Guinea  Bissau,
Tanzania, Comoros, Swaziland and Botswana.

103

                                                
5.9.2

Corporate Social Responsibility (CSR)

In  addition  to  stepping  up  cooperation  and  consultation  with  not-for-profit  civil
society groups, the Community has also recognised the important role that the private
sector can play in helping to achieve (or inhibit) the Millennium Development Goals
and  other  sustainable  development  objectives.  Corporate  social  responsibility  is  a
very  broad  term  that  applies  to  the  overall  framework  for  stakeholder  consultation
and  benchmarking  among  companies  that  are  proactive  in  sustainable  development
(including social, environmental and economic aspects). It is a tool that can be used
to enhance the private sector’s contribution. In July 2002, the Commission published
a new Communication setting out its approach and priorities in this area: “Corporate
Social  Responsibility:  a  Business  Contribution  to  Sustainable  Development”.103
Amongst  the  key  recommendations  was  a  proposal  for  the  creation  of  an  EU
Multi-stakeholder  Forum  on  CSR,  to  help  foster  a  dialogue  between  the  business
community,  trade  unions,  civil  society  organisations  and  other  stakeholders.  The
Commission participates actively in the activities of the Coordination Committee of
the  Stakeholder  Forum.  In  2003  and  the  first  half  of  2004,  a  “Development
Roundtable” will examine best practices in the context of the international dimension
of CSR.

5.9.3

Activities in 2002: partnership with NGOs

In  2002,  the  Commission  selected  223  projects  or  sets  of  actions  proposed  by
European non-governmental organisations to be executed by them in least developed
countries or where the beneficiary populations are the most vulnerable, for a total EC
contribution of €177.3 million.

The  Commission  also  selected  45  operations  designed  by  European  NGOs  to  raise
the awareness of the European public opinion (i.e. in Member States) to development
issues, up to €21.4 million.

The  Commission  contributed  to  the  operational  budget  of  the  representative
organisation of  the European NGOs  helping them to re-structure  and  improve  their
networking capacity at a time of great change for a total contribution of €0.5 million.

And as part of its endeavours to reinforce the capacity of the non-state actors of the
South  (i.e.  actors  of  civil  society  in  the  developing  countries),  the  Commission
contributed €3 million to the organisation that supported the participation of the civil
society delegates from developing countries in the World  Sustainable  Development
Forum that took place in Johannesburg in August.

This gave a 99.23% utilisation rate of the commitment appropriations for 2002 and it
was  achieved following the evaluation  and  selection rules established  to  ensure  the
transparency  demanded  by  Commission  reform;  proposals  were  submitted  to  the
Member States on the NGO Cofinancing Committee.

Another  salient  achievement  of 
the  genuine
communication  successes  with stakeholders; for  example, a  new  website  integrated
into  the  EuropeAid  Cooperation  Office  site,  visits  and  seminars  with  platforms
representing  national  NGO  communities,  and  the  publication  of  the  “Infoguide  on

the  Commission 

in  2002 

is 

103

COM(2002) 347.

104

                                                
cofinancing”,  a  reference  document  covering  most  practical  and  administrative
aspects of project cofinancing.

5.9.4

NGOs financing in 2002

The  remit  of  the  Commission  is  to  determine  the  criteria  of  selection  of  proposals
presented  by  the  European  NGOs  using  of  their  right  of  initiative.  It  is  therefore
important  to  monitor  the  geographical  spread  of  Aid  funds  disbursed  under  its
responsibility in order to detect distortions and attempt to correct them if necessary.

B7-6000 Projects geographical breakdown 97-02

180.000.000
160.000.000
140.000.000
120.000.000
100.000.000
80.000.000
60.000.000
40.000.000
20.000.000
0

Central America

Latin America

Asia

Mediterranean

Pacific

Caribbean

Sub-Saharan Africa

1997 1998 1999 2000 2001 2002

At the time of writing, the 2002 figures mentioned in the table above do not take into
account  the  results  of  the  block-grants.  These  sets  of  actions  executed  in  various
countries  would  increase  the  total  to  €177.3  million  and  affect  the  geographic
breakdown accordingly.

The Commission recognises the increasing trend towards sub-Saharan Africa, which
validates  its  claim  that  it  directs  its  actions  to  the  poorest  and  most  vulnerable
beneficiaries.

The  two  next  tables  show  trends  in  terms  of  utilisation  of  budgetary  resources  and
number of contracts over the years (whereby BG stands for block grants, ED stands
for education to development, and PVD stands for developing countries).

105

124

180
160
140
120
100
80
60
40
20
0
1997

24

17

B7-6000 commitments € m

148

139

171

162

122

26

18

26

21

39

21

1998

1999

2000

B7-6000 number of grants

BG

ED

PVD

19

21
14

5

2001

2002

417

179

170

450

400

350

300

250

200

150

100

50

353

181

140

404

180

174

301

83

71

0
1997

1998

1999

2000

PVD

ED

BG

238

49

6
2001

201

45
22

2002

In 2002, the Commission evaluated 1304 new grant requests and elected to cofinance
263 new projects plus 11 projects which were already approved in 2001. This 5 to 1
ratio is similar to 2001 and will not improve in future.

At the end of the year, twenty task managers thus had a portfolio of 2450 contracts.
The  average value of the  274  new  contracts  in  2002  is  some  €0.73  million,  an  8%
increase on the average value for 2001.

106

6.

ACTIVITIES IN 2002

This  chapter  covers  the  essential  activities  of  EC  external  assistance  in  2002  on  a
geographical basis. Each section covers one region, including the “geographical budget lines”
and some of the other EC “horizontal” initiatives which can be regionally disaggregated. As
well  as  the  political  and  programming  background,  this  chapter  presents  results  of  projects
and  programmes  committed  in  previous  years  and  the  most  significant  trends  in  2002
commitments.  Complete  data  for  commitments  in  2002,  per  region  and  per  sector,  can  be
found in Chapter 8 – Financial tables.

Financial management: commitments/disbursements

The budgetary  concepts enshrined in the new Financial Regulation provide for two types of
appropriations for operations running from one budgetary year to another:

– 

– 

Commitment appropriations setting annual limits for the commitments which will be
entered into with third parties;

Payment appropriations to cover disbursements planned in any given year.

There  is  thus  no  direct  link  between  commitments  and  payments,  the  latter  covering  also
outstanding  commitments.  This  is  the  reason  why  this  report  does  not  include  the  fictitious
ratio “commitments/payments” that was usually published.

As regards commitments, the deadline for signing a Financing Agreement is 31 December of
the year following the one in which the global budgetary commitment was finalised (“n+1”).

In addition, the deadline for concluding the individual contracts and agreements implementing
the Financing Agreement is fixed at three years after the date on which the global budgetary
commitment was finalised (“n+3”).

All budgetary commitments corresponding to contracts not having given rise to a payment in
the  period  of  three  years  following  their  signature  will  be  decommitted.  For  details,  please
read the annexes on RAL.

Regions covered by EC External Assistance

EC external assistance covers all regions of the world. The following sections describe the EC
partnership  and  cooperation  activities  in  all  of  them  on  a  geographical  basis.  For  easier
reading, we have listed all of the countries of each region below. The subregions are indicated
where relevant.

Western Balkans

Albania,  Bosnia  and  Herzegovina  (BiH),  Croatia,  the  former  Yugoslav  Republic  of
Macedonia, the Federal Republic of Yugoslavia (FRY)

The Partner States of Eastern Europe and Central Asia

Armenia,  Azerbaijan,  Belarus,  Georgia,  Kazakhstan,  Kyrgyzstan,  Moldova,  Mongolia,
Russia, Tajikistan, Turkmenistan, Ukraine, Uzbekistan

107

South Mediterranean, Near and Middle East

Algeria,  Cyprus*  Egypt,  Israel,  Jordan,  Lebanon,  Malta,*  Morocco,  Palestinian  Authority,
Syria, Tunisia, Turkey*

* Originally Euromed countries, now EU candidate countries.

African, Caribbean and Pacific (ACP) and Overseas Countries and Territories (OCTs)

Caribbean

Antigua and  Barbuda,  Bahamas,  Barbados, Belize, Cuba**  Dominica, Dominican  Republic,
Grenada,  Guyana,  Haiti,  Jamaica,  St  Kitts  and  Nevis,  St  Lucia,  St  Vincent  and  the
Grenadines, Suriname, Trinidad and Tobago.

** Cuba was admitted as a new member of the ACP in December 2000, but is not signatory to
the Cotonou Agreement.

Pacific

Cook Islands, Fiji, Kiribati, Marshall Islands, Micronesia, Nauru, Palau, Papua New Guinea,
Samoa, Solomon Islands, Tonga, Tuvalu, Vanuatu.

West Africa

Benin, Burkina Faso, Cape Verde, Ghana, Guinea, Ivory Coast, Liberia, The Gambia, Guinea
Bissau, Mali, Mauritania, Niger, Nigeria, Senegal, Sierra Leone, Togo.

Central Africa

Cameroon,  Central  African  Republic,  Chad,  Equatorial  Guinea,  Gabon,  Sao  Tome  and
Principe.

Eastern and Southern Africa and Indian Ocean

Angola, Botswana, Burundi, Comoros, Rep. Congo, Democratic Republic of Congo, Djibouti,
Eritrea,  Ethiopia,  Kenya,  Lesotho,  Madagascar,  Malawi,  Mauritius,  Mozambique,  Namibia,
Rwanda,  Seychelles,  Somalia,  South  Africa,  Sudan,  Swaziland,  Tanzania,  Uganda,  Zambia,
Zimbabwe.

Overseas Countries and Territories

Anguilla, Aruba, British Antarctic Territories, British Indian Ocean Territories, British Virgin
Islands, Cayman Islands, Falkland Islands, French Polynesia, French Southern and Antarctic
Territories,  Greenland,  Mayotte,  Montserrat,  Netherlands  Antilles,  New  Caledonia,  Pitcairn,
St Helena and Dependencies, St Pierre and Miquelon, South Georgia and the South Sandwich
Islands, Turks and Caicos, Wallis and Futuna.

Asia

ASEAN

Brunei,  Burma/Myanmar,  Cambodia,  Indonesia,  Laos,  Malaysia,  Philippines,  Singapore,
Thailand, Vietnam.

108

SAARC

Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, Sri Lanka.

Other Countries and Regions*

Afghanistan, China, East Timor, Hong Kong, North Korea, Macao.*

* Yemen, Iran, and Gulf countries are dealt with in the Mediterranean section of the report

Latin America

Central America

Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama

Andean Community

Bolivia, Colombia, Ecuador, Peru, Venezuela.

Mercosur

Argentina, Brazil, Paraguay, Uruguay.

Others

Chile, Mexico

6.1.

WESTERN BALKANS

In 2002, the Stabilisation and Association Process (SAP) continued to be the driving
force  behind  the  developing  relationship  between  the  European  Union  and  the
countries of the Western Balkans, namely Albania, Bosnia  and  Herzegovina (BiH),
Croatia,  Federal  Republic  of  Yugoslavia104  and  Former  Yugoslav  Republic  of
Macedonia.

The instruments of the Stabilisation and Association Process – the Stabilisation and
Association  Agreements,  CARDS  assistance,  Autonomous  Trade  Measures105  and
Regional  cooperation  –  are  all  designed  to  facilitate  the  development  of  this
relationship. The instruments are mutually reinforcing so as to maximise their impact
and ensure consistency of Community action in the different countries. The CARDS
programme has continued to play a key role by providing assistance in the key area
of reform and institution building.

104

105

Following  the  adoption  and  promulgation  of  a  new  Constitutional  Charter  on  4  February  2003,  the
Federal Republic of Yugoslavia has changed its name to “Serbia and Montenegro” (in Serbian: Drzavna
Zajednica Srbija i Crna Gora).
Autonomous  Trade  Measures  are  unilateral  initiatives,  aimed  at  granting  special  trade  preferences  to
developing and less wealthy countries.

109

                                                
6.1.2.

Strategic Goals and Achievements

Broadly  speaking,  assistance  under  the  2002  annual  programmes  was  gradually
directed  towards  areas  at  the  heart  of  the  Stabilisation  and  Association  Process.
Institution building (e.g. strengthening of administrative capacity, advice on drafting
of  new  legislation  to  meet  European  standards,  etc.)  as  well  as  justice  and  home
Affairs received particular attention.

Clearly,  the  countries  involved  are  at  different  stages  of  legal  and  administrative
development, and at different stages of the Stabilisation and Association Process. For
this reason, CARDS assistance has an in-built capacity to deal with a heterogeneous
situation  and  adjust  to  the  existing  situation  in  each  country  by  focusing  on  their
specific  needs.  At  the  same  time,  a  regional  programme  has  also  been  launched  to
ensure greater synergy, coherence and complementarity at regional level.

Much progress was made over the year in the area of regional cooperation. While the
quality and dimension of this cooperation depends to a large extent on the countries
themselves, the CARDS programme has contributed substantially in key areas such
as  trade  facilitation  and  development  of  regional  infrastructures.  Community
assistance  in  the  area  of  customs  administration  has  provided  important  practical
results such as supporting reform in the lead ministries, increasing revenues for the
state  budget  by  establishing  mechanisms  to  prevent  fraud  and  facilitating  regional
trade cooperation.

CARDS COMMITMENTS AND PAYMENTS IN THE REGION 2002
(€ MILLION)

Programmes

Commitments

Payments

Countries/bilateral

Albania

Bosnia and Herzegovina

Croatia

FRY-Serbia/ Montenegro

FRY-Kosovo

FYROM-Macedonia

Regional

Cooperation

Subtotal

Regional

2002

2001

2002

2001

44.90

85.21

59.00

204.70

166.60

41.50

37.50

118.10

60.00

230.00

171.50

56.20

25.70

104.93

17.22

259.56

133.83

67.93

56.00

143.20

14.50

195.80

402.10

28.10

601.91

673.30

609.16

839.70

43.50

20.00

3.99

1.70

Total bilateral/ regional

645.41

693.30

613.15

841.40

Other  budget  lines/  BA  lines  (ATA)
etc

8.44

8.00

3.95

4.70

Total

653.85

701.30

617.10

846.10

110

CARDS COMMITMENTS AND PAYMENTS 1995-2002 (€ MILLION)

Overall commitments

440

581

584

462

988 1.062 1.035

654

5.806

1995

1996

1997

1998

1999

2000

2001

2002

Total

Of Which:

CARDS
(Obnova-Phare
CARDS budget lines)

Commitments

Payments

81

73

320

298

330

254

305

146

455

237

843

624

796

618

654

617

3.784

2.867

6.1.3.

Programming Priorities

Following  the  approval  in  late  2001  of  the  Country  Strategy  Papers  and  the
Multiannual  Indicative  Programmes  included  in  them,  CARDS  assistance  for  the
countries  of  the  region  has  been  structured  along  the  following  priority  lines:
a) infrastructure,  with  a  substantial  amount  devoted  to  energy,  b)  economic  and
social development, including measures to support trade, c) justice and home affairs,
d) administrative capacity building, e) democratic stabilisation, including support to
refugee returns and f) environment and natural resources.

In  2002  support  for  infrastructure  still  represented  the  largest  component  of
assistance,  mainly  due  to  the  conclusion  of  reconstruction  efforts  in  Bosnia  and
Herzegovina and in the FRY. But 2002 was also a turning point in this area; support
to the infrastructure and energy sectors will be gradually wound down in subsequent
years  in  favour  of  other  sectors  more  closely  linked  to  the  SAp  reform  agenda,  in
particular justice and home affairs and administrative capacity building. This is also
consistent with the increasing involvement of the international financial institutions,
whose long-term lending represent a more suitable type of support for this sector.

The  European  integration  process  has  been  a  particular  focus  for  European
Community support. All the countries of the region have embarked on a process of
closer  integration  with  the  EU  and  are  setting  up  suitable  structures  to  support  it.
Usually  they  are  in  European  Integration  Offices,  in  some  cases  Ministries  of
European  Integration,  in  addition  to  several  specialised  departments  within  line
ministries.  This  approach  has  proved  its  worth  in  the  enlargement  context  and  the
technical  assistance
Community  has 
specifically devoted to training and providing capacity to departments responsible for
this function.

its  usefulness,  mobilising 

recognised 

6.1.4. Main Results in 2002

6.1.4.1. Country Strategies

The Community’s financial support is not provided in isolation but follows strategies
to meet major challenges for the region as set out in the Country Strategy Papers and
the  Regional  Strategy  Papers.  All  Country  Strategy  Papers  and  Regional  Strategy
Papers  were  prepared  and  approved  at  the  end  of  2001,  and  the  2002  Annual
programmes  for  the  Western  Balkan  countries,  including  the  regional  programme,
were prepared and approved according to the strategic orientations defined in them.

111

No new Country Strategy Papers were drafted or changes to existing strategies made
in 2002.

6.1.4.2. Implementation

In 2002, the level of disbursements fell from €972 million in 2001 to €617 million in
2002. This was primarily due to a reduction of €168 million in payments for Kosovo
following the slowdown in emergency assistance. The 2002 payments accounted for
93% of the available budget. The balance was to be reprogrammed in favour of the
energy sector in Kosovo after a fire in Kosovo’s main power plant in July 2002. The
reprogrammed amounts were contracted in December 2002.

– 

Conflict Prevention, Good Governance and Rule of Law

The resolution of the political and security crisis in the former Yugoslav Republic
of Macedonia in 2001, and continued efforts during 2002, have proved the value of
a  combination  of  important  elements  in  defusing  a  crisis  with  potentially  highly
damaging  effects  for  the  country  and  the  region  at  large:  political  leverage,
adjustment of financial support mechanisms and effective  coordination with  donors
and the international community in general. It is a clear example of how Community
instruments  can  be  used  in  a  coherent  and  effective  manner  to  facilitate  conflict
resolution.

Community support has also contributed to significant progress in promoting human
rights  and  fundamental  freedoms  in  the  region.  CARDS  assistance  focused  on  a
limited  number  of  areas  in  cooperation  with  other  more  specialised  donors  and
institutions. Resources were mobilised  to develop necessary legislation  in the  areas
of  human  rights,  media  and  civil  society.  In  recognition  of  the  importance  of
independent  media  and  the  availability  and  provision  of  genuine  public  services,
CARDS  supported  media  outlets  in  some  countries  and  at  regional  level.
Furthermore,  recognising  the  importance  of  an  active  civil  society  and  NGOs,  the
Commission  established  support  programmes  using  resources  of  both  the  CARDS
programme  and  the  European  Initiative  for  Democracy  and  Human  Rights
(EIDHR).106 Efforts were also devoted to transforming state-owned media operators
into efficient public service providers in several countries.

The Community also provided important financial support to the Office of the High
Representative in Bosnia and Herzegovina and to UNMIK (United Nations Mission
to Kosovo) in Kosovo.

In Bosnia and Herzegovina, increased focus was placed on the sector of justice and
home  affairs  with  notable  achievements  in the  field  of  policing  (e.g.  technical
assistance  support  for  procurement),  the  restructuring  of  courts  and  prosecutors’
offices  and  the  reselection  of  judges  and  prosecutors  through  EC  support  for the
Independent  Judicial  Commission.  Renovation  of  the  Sarajevo  Police  Academy,
which will train police cadets, was completed in 2002 and Commissioner Patten laid
the  foundation  stone  of  the  Banja  Luka  Police  Academy  in  September.  The  EU
helped the BiH State Border Service to establish full control of the country’s borders

106

Bosnia Herzegovina and FRY are two target countries of the EIDHR support.

112

                                                
by  donating  vital  equipment  such  as  130  vehicles,  temporary  offices,  computers,
boats and radio communication equipment.

In the  area of conflict prevention, good governance and rule of law in the  Balkans,
six  projects  were  closed  and  seven  are  ongoing.  Out  of  closed  activities,  the  EC
contribution  to  supporting  the  democratisation  process  in  the  former  Yugoslav
Republic  of  Macedonia  is  to  be  highlighted.  For  the  general  elections  on
15 September 2002, a group of observers of the European Union, made up of a team
leader and 100 short-term observers, joined the electoral observation mission of the
OSCE/ODIHR. In 2002, the EIDHR supported projects for more than €10.6 million
in total.

EC support to the European Union Police Mission in Bosnia and Herzegovina

The European Union Police Mission (EUPM) started work on 1 January 2003.  With  extended
and refocused objectives and mission statement, the EUPM follows on from the United Nations
International  Police  Task  Force  whose  mandate  terminated  at  the  end  of  2002.  The  EUPM
represents  a  historical  step,  as  it  is  the  first  civilian  crisis  management  operation  under  the
Common Foreign and Security Policy (CFSP).

With  900  staff,  including  500  police  officers,  80%  of  whom  come  from  Member  States,  the
EUPM  will  use  its  three-year  mandate  to  bring  the  police  forces  of  Bosnia  and  Herzegovina
(BiH) up to the highest international standards.

In  designing  this  operation  it  was  recognised  that  efficient  police  must  be  integrated  into  a
general  and  strengthened  rule-of-law  environment.  Therefore  the  European  Commission  with
its  CARDS  programme  and  the  Council  of  the  European  Union  are  working  hand  in  hand
towards  that  goal  in  their  respective  areas  of  competence,  i.e.  institutional  building  and  the
CFSP. Under CARDS, €10 million was committed in 2002 to support reform of the police forces,
and develop sustainable institutional structures for policing. The CFSP budget (2nd Pillar but
implemented  by  the  Commission)  provided  €14  million  in  2002  to  procure  the  necessary
equipment  before  the  actual  start  of  the Mission  in  2003.  In  addition,  the  EC  has  become  the
main donor for reform of the justice system. In all these activities, a special focus was placed on
the fight against organised crime, one of the main issues blocking the development of institutions
and the rise of a citizen-based democracy.

The EU can be proud of tackling a series of issues - reform of the justice system and operations
concerning taxation and customs, asylum and migration, border management and the EUPM -
that will help promote law and order and the sustainability of institutions in BiH, so increasing
the chances of economic regeneration in this country recovering from war.

Training the Albanian Police Forces

In  2002  the  European  Commission  laid  the  foundations  for  major  police  projects.  It  signed  a
partnership  contract  worth  €6  million  with  the  Spanish  Ministry  of  Interior  to  set  up  a
long-term  EC  police  assistance  mission  to  Albania  (PAMECA)  that  would  follow  up  the  EC
assistance  that  has  been  provided  to  the  Albanian  police  forces  since  1998.  The  programme
provides advice, training and technical assistance not only for the Albanian police forces (fight
against  organised  crime,  public  order,  and  so  on)  but  also  to  the  judiciary  (improving
cooperation  between  the  police  and  prosecutors’  offices).  PAMECA’s  work  covers  all  the  key
areas needed to make the Albanian police more efficient and professional and imbued with the
required ethical principles and morale.

Regional cooperation with Interpol

Under the 2001 Regional CARDS Programme the Commission signed at the end of the year a
€1.4 million-contract  with  the  Secretary  General  of  Interpol  for  the  modernisation  of  the
equipment of its National Offices in five Balkan countries. The project, which includes adequate
training, will improve the exchange of information between the partner countries of the Interpol
conventions.

113

– 

Institution Building

The number of ongoing projects (121) involving institution building reflects the shift
of  the  EC  assistance  from  reconstruction  to  capacity  building.  20  projects  were
closed in 2002.

In  the  CARDS  focal  area  of  administrative  capacity  building  in  Bosnia  and
Herzegovina,  EC  assistance  brought  significant  results.  A  Customs  and  Fiscal
Assistance Office (CAFAO) was set up in 1996 to  assist in the  implementation of
the  customs-related  provisions  of  the  General  Framework  Agreement  for  Peace
(GFAP)  through  a  programme  of  modernisation  and  development.  In  2002,
CAFAO’s  activities  resulted  in  substantial  increases  in  customs  revenue  and
decreases in related fraud and corruption.

The customs programme, except for issues linked to integrated border management,
can  be  seen  as  having  been  largely  delivered  at  the  technical  level,  in  that  the
necessary  skills  have  been  transferred  to  local  officials.  ASYCUDA  (Automated
System for Customs Data) was rolled out BiH-wide, making it possible for the first
time to collect complete import and export statistics.

structures  presented 

Reviews  of  the  Federation  and  Republika  Srpska  tax  administrations  have  been
completed, and recommendations for the implementation of modern organisation and
management 
respective  governments.  The
to 
recommendations  are  being  implemented  with  CAFAO  assistance.  The  assistance
has  facilitated  the  creation  by  the  Entity  Taxation  Services  of  large  trader  control,
debt  management,  intelligence  and  investigation  units.  These  are  already  having  a
positive  effect  on  the  revenue  yield,  with  cases  of  evasion  totalling  in  excess  of
500 million konvertibla marka (€250 million) detected over the period 1 January to
31 August 2002.

the 

The CAFAO taxation programme is now being enlarged to include a VAT planning
and implementation  project. This  project  will  enable  the  EC  to  take  the  lead  donor
role  in  supporting  the  local  authorities  during  the  decision-making  process  on  the
structure of the new tax and eventually in its implementation.

In civil aviation, EC assistance through the International Civil Aviation Organisation
(ICAO)  has strengthened  the  institutional  and  professional  basis  of  the  Department
for Civil Aviation; this included the appointment of a Director-General. BiH now has
control  of  its  own  lower  air  space  with  air  traffic  control  operations  at  Sarajevo
International Airport, and a national search and rescue service has been established in
Banja  Luka.  The  three  Statistical  Offices  were  fully  computerised  in  2002  and
professional  staff  trained.  This  has  brought  the  material  and  human  resources  to  a
sufficient standard to improve the poor quality of BiH statistics in coming years.

EC support to government institutions of BiH has rationalised their work. The EC
contributed  to  the  drafting  of  the  state  civil  service  law,  setting  up  the  BiH
Parliament and Presidency  Secretariat  and to the  review  of  drafting  procedures and
establishment  of  a  drafting  code.  A  training  programme  for  120  government  civil
servants focused on issues such as public management, public administration, human
resources  management  and  leadership.  Furthermore,  EC  assistance  had  a  major
impact in setting up the civil service agency at state level. A central registry with a
personnel database was created, and a complete set of by-laws for implementing the

114

civil  service  law  and  basic  rules  for  financial  management  and  the  budget  were
prepared  for  2003.  Draft  rules  and  procedures  for  the  selection  panel  for  the
recruitment of civil service agency staff were prepared. All this will enable the civil
service agency to fulfil its tasks from early 2003.

Economic and social development in Bosnia and Herzegovina: the EC continued to
promote regional and local economic development (LED) through direct support of
six  LED  agencies,  which  are  now showing  an  economic  dividend,  including
employment generation.  The EU  Quick  Impact  Facility  has  been  successful  in
bringing together the private and public sectors and creating some 2 000 jobs, over
50% of  which  for  returnees  with  a  nominal  cost of  €1  620  per  job.  The  EC has
further contributed in 2002 to the successful privatisation of nine public enterprises
state
in  2002  and 
enterprises. Assistance  was  also  provided  to  promote  foreign  direct  investment  in
BiH  and  ‘unbundle’  the  state  owned  electricity  industry.  The  EC’s  assistance  to
the BiH  insurance  sector  led directly  to a  coherent  legal  framework  and  draft
legislation, which is a significantly contribution to the creation of a single economic
area  in  BiH. Furthermore,  an  additional  commercially  operated  €10  million  credit
line for SMEs was launched, further augmenting the European Fund to BiH.

the  restructuring  of  35 private  and 

support 

to 

The  Institute  of  Statistics  in  Albania  (INSTAT)  has  been  supported  through  two
EC-funded  technical  assistance  projects.  One  of  the  highlights  was  the  population
and household census and its follow-up. The EU financed the recruitment of nearly
10 000 census-takes and the transport of the census materials (questionnaires, etc.) to
the  36  districts  of  Albania  and  back  to  Tirana.  The  project  improved  the  basic
statistical  infrastructure,  which  is  needed  to  improve  the  provision  of  appropriate
statistical data for decision making and governance in the country.

115

An instrument for institution building: CARDS twinning

Until 2002 the twinning instrument was used in programmes for the EU candidate countries. It
has  now  been  exported  to  the  CARDS  programme,  albeit  in  adapted  form  to  reflect  the  SAp
countries’  different  level  of  association  with  the  EU.  Twinning  supports  and  finances  the
secondment  of  civil  servants  from  EU  Member  States  to  work  as  advisers  in  beneficiary
institutions for a period of at least twelve months. This assignment is complemented by a variety
of  measures  such  as  seminars,  workshops  and  training  sessions.  It  is  an  efficient  means  of
transferring  know-how  but  also  of  creating  partnerships  between 
institutions.  These
partnerships will outlast the twinning assignment and contribute to further cooperation between
Member States and partner countries. Current candidate countries are eligible to participate in
CARDS Twinning as junior partners and have shown great interest in providing their expertise
for institutional change in the CARDS region.

Twinning  should  be  considered  as  an  additional  instrument  for  implementing  the  CARDS
programme.  It  complements  existing  instruments  and  plugs  a  gap  between  private  sector
consultants (often short-term) and the larger-scale  “missions” of public sector assistance, such
as those for current CARDS police and customs programmes.

Twinning is mainly used in the following sectors:

– 

– 

– 

– 

Justice and home affairs, notably in three areas, justice and prosecutor systems, policing
and border guards and migration policies.

Public  sector  financial  management 
control/audit and public procurement.

in  terms  of  taxation,  budgeting,  financial

General civil service reform in terms of basic civil service laws and restructuring.

Approximation towards some core acquis legislation, notably in the four basic freedoms
of  movement  of  goods,  services,  capital  and  establishment.  Freedom  of  movement  of
workers  is  far  more  problematic.  In  consequence,  customs  and  trade  facilitation  (i.e.
norms, standards, veterinary and phytosanitary controls) are focus areas in all countries,
as is competition and state aids for the more advanced states.

In  2002  there  were  five  twinning  projects,  four  in  Croatia  and  one  in  Albania.  Twinning  will
continue in Croatia in 2003 and will be extended to the other CARDS partner countries.

– 

Regional cooperation

One project in the CARDS 2001 regional programme, namely the “Regional Balkans
Infrastructure Study Transport” (REBIS Transport, €2.45 million) was closed.

A  major  component  of  institution  building  and  public  administration  reform  in  the
Western  Balkan  countries  consists  of  the  broad  area  of  justice  and  home  affairs
(JHA).  In  order  for  the  EU  and  national  authorities  to  create  a  coherent  and
comprehensive  reform  programme  of  JHA  institutions  for  the  future,  it  was
necessary to conduct an updated overview of the situation, initiatives and problems
in  that  area,  both  in  individual  countries  and  at  regional  level.  The  Commission
accordingly undertook, as part of the 2001 CARDS regional programme, to finance
JHA assessment missions of experts nominated by the EU Member States to all five
countries in the region in May and June 2002.

A  detailed  report  was  issued  for  each  country.  The  reports  contain  a  thorough
assessment  of  the  state  of  play  in  the  area  of  JHA,  plus  some  conclusions  and
recommendations  for  reforming  the  legal  and  institutional  arrangements.  They  also
suggest possible areas for financial support by the EU. The reports were presented to

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the  visited  countries  and  international  organisations  in  November  2002  (in  English
and local languages to facilitate the exchange of information). The recipients sent in
comments  in  January-February  and  the  reports  were  finalised  in  April  2003.  The
final results will help the Commission in selecting specific projects in this area.

– 

Transport, Infrastructure and Energy

In this sector eight projects are ongoing. Of the 14 closed in 2002 the following are
particularly important:

in 

improvements 

to  significant 

The  European  Commission  contributed 
the
interconnectivity  of  the  Bosnia  and  Herzegovina  transport  network  with  the
completion of the Samac and Kostajnica bridges. Together with the Ploce-Samac rail
electrification,  the  pan-European  V-c  Corridor  through  Bosnia  and  Herzegovina  is
now  operational  for  both  road  and  rail.  The  air  traffic  control  tower  of  the  Mostar
Airport  was  inaugurated.  The  commissioning  of  two  110kV  lines  between  Pale  –
Gorazde and Srebrenica – Konjevic marked the final contribution of the EC energy
programme  to  the  rehabilitation  of  the  electricity  grid.  The  European  Agency  for
Reconstruction  (EAR)107  is  particularly  involved  in  rebuilding  infrastructure.  The
Agency  has  been  managing  massive  EC  investments  in  rehabilitation  and  related
training  in  the  Kosovo  energy  sector  and  helped  to  make  substantial  progress  in
Montenegro  in  developing  municipal  government  and  completing  local  investment
projects throughout many towns and cities. It has helped to develop cultural centres,
rehabilitate local roads, improve water pipelines and sewerage networks, and build a
new  fire  brigade  building  and  a  school.  In  the  former  Yugoslav  Republic  of
Macedonia,  the  EAR  is  upgrading  several  important  transnational  road  corridors.
Work was completed on the first phase of upgrading the E-75 motorway linking the
country with Greece (Corridor X). A bypass has been finished around Tetovo, on the
E-65  motorway  (Corridor  VIII  that  links  Albania  and  Bulgaria  through  the  former
Yugoslav Republic of Macedonia).

Significant steps to link  the  region  to  the  neighbouring  countries  were  taken  in  the
second half of 2002 when a number of regional infrastructure projects were started.
Efforts were concentrated on investments to upgrade infrastructures to EU standards
and importantly, led to an agreement between the South East European countries on
a  rail  and  road  network.  The  regional  programme  has  inter  alia  helped  mobilise
strategic  resources,  which  have  led  to  the  signing  by  the  countries  of  the  Balkan
region of the Memorandum of Understanding on Regional electricity market.

– 

Food Security and Rural Development

There have been two separate programmes of budgetary assistance for food security
in  Montenegro.  The  willingness  of  the  Montenegrin  authorities  to  implement  the
reforms played a great role in their success.

107

The European Agency for Reconstruction (EAR) in Thessaloniki is responsible for the management of
the  main EU  assistance  programmes  in  the  Federal  Republic  of  Yugoslavia  and  the  former  Yugoslav
Republic of Macedonia. EC assistance funds delegated to the Agency for management in 2002 totalled
€480 million. At the end of 2002 the Agency was overseeing a cumulative portfolio of over €1.6 billion
across its four operational centres (Pristina, Belgrade, Podgorica and Skopje). See http://www.ear.eu.int

117

                                                
The Food Security Programme (FSP) has been successful in introducing a coherent
programme of reforms in the areas of food security policy, agricultural reform and in
the management of public finances. One of the key achievements of the programme
has  been  the  reform  of  social  entitlements,  which  should  ensure  that  the  most
vulnerable  receive benefits.  The process has  in  fact proved to be so  successful  that
other donors have decided to finance this kind of project. The good progress made in
implementing reforms means that the second FSP has been able to focus on measures
to consolidate policy reform.

In  Albania,  the  EC  assistance  to  Economic  and  Social  Development  included
support  to  improving  the  quality  of  life  in  rural  areas  through  a  Local  Community
Development  Programme.  In  FRY,  the  assistance  targeted  at  private  sector  and
agricultural development has contributed importantly to job creation and to a much-
needed resurrection of a vibrant private sector.

– 

Health

The structure of health manpower and hospitals in the Western Balkans is the result
of  extensive,  hierarchical,  and  disease-oriented  health  care  systems  The  wars  have
had  long-term  physical  and  psychological  effects  and  there  is  a  need  to  strengthen
institutions, human resource training, population health research and social cohesion.
Health care for refugees and  internally  displaced persons  is extremely  rudimentary.
Certain  areas  possess  a  serious  health  risk  due  to  increased  population  movements
resulting in the highest reported incidence of tuberculosis in Europe. The real scale
of  the  environmental  damage  and  its  consequent  impact  on  human  health  has  not
been clearly established. In Croatia, Serbia and the former Yugoslav Republic of
Macedonia the once flourishing pharmaceutical industry has not yet fully recovered
from the war. In Kosovo, the health infrastructure is fragile. Communicable diseases
threat  vulnerable  groups.  Rural  areas  and  minority  enclaves  are  being  increasingly
isolated. The Serbs depend on the Kosovo Force (KFOR) for security when in need
for medical help.

The  European  Commission  is  trying  to  improve  the  situation  with  specific  health
projects to reform health care systems and improve the pharmaceutical sector and its
regulatory  framework.  A  number  of  ongoing  projects  target  the  quality  of  basic
services  in  hospitals  and  health  centres  by  rehabilitating  or  procuring  priority
equipment. Supplies of essential drugs, reagents, medical consumables, together with
training  and  technical  assistance  for  medical  education  and  capacity  building  for
health services management, are an important part of EC’s aid to the region.

– 

Education

In 2002, the TEMPUS programme continued to support in each Balkan country the
overhaul of teaching programmes in universities, university management reform and
the strengthening of links between universities and society at large, primarily through
Joint European Projects. Five major projects were closed, two are ongoing.

The  EC  contributed  to  the  development  of  the  Bosnia  and  Herzegovina Strategy
Paper  for  Education  Reform  presented  to  the  Peace  Implementation  Council  on
21 November 2002. In 2002, support to vocational education was continued. A first
countrywide  labour  market  survey  focusing  on  cooperation  between  the  labour
market,  vocational  schools  and  SMEs  was  completed;  this  will  help  to  improve

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cooperation  between  these  three  partners  and  make  vocational  training  more
responsive  to  the  demands  of  the  labour  market.  Concerning  primary  and  general
secondary  education,  recommendations  to  the  education  ministries  concerning
reform  of  the  general  education  system  were  well  received.  Drafting  of  a  Green
Paper has started with broad participation of all stakeholders in the education sector.

– 

Environment and Natural Resources

In  the  focal  area  of  environment  and  natural  resources,  two  projects  have  been
completed and six are ongoing. Important results were achieved with the nationwide
implementation  of  the  rural  credit  scheme  in  Bosnia  and  Herzegovina.  In  Brcko
alone some 169 jobs have been saved and 94 created as a direct result of the EC loan.
In the veterinary sector, the EC supported the adoption of the State Veterinary Law
and the institutionalisation of the State Veterinary Office, the implementation of the
Animal  Identification  and  Movement  Control  Scheme  and  the  equipping  of
veterinarian  laboratories.  EC  funds  have  supported  the  BiH  Extension  services
through 12 offices providing advice and essential assistance to farmers. In the water
sector, despite considerable difficulties, River Basin Bodies for the Bosna and Vrbas
were established. The EC contributed to the ratification of the environmental law and
the development of the environmental framework law at the state level

– 

Partnership Civil Society and NGOs

the  development  of 

services  provided  by  NGOs. 

In  Albania  the  EC  helps  to  strengthen  local  associations  and  institutions  and  to
foster 
In  Croatia
institution-building support is given to environmental NGOs and to state institutions
and  civil  society  organisations  for  improving  social  service  delivery  in  social  care,
health  and  education.  EC  assistance  in  the  former  Yugoslav  Republic  of
Macedonia promotes inter-ethnic relations and the strengthening the civil society. In
Bosnia  and  Herzegovina.  Small-scale  operations  and  EIDHR  grants  supported  35
civil  society  actors,  including  youth  and  women  groups,  returnees  and  displaced
persons,  disabled  people,  and  community  and  cross-entity groups, thus  contributing
to the growth  of  a  more  active  civic  society, democracy  and  human  rights.  The  EC
also  assisted  the  BiH  Election  Commission  to  finance  polling  station  committees
during the general elections in October 2002.

– 

Rehabilitation/Landmines

Mine Action  projects  aim  at  improving  the  economic  and  social  conditions  in  the
countries  of  South  East  Europe,  as  well  as  stabilising  and  normalising  the
populations’ conditions of life. Border Mine Clearance is a project implemented by
International  Trust  Fund  for  Demining  and  Mine  Victims  Assistance  (ITF)  that
supports the de-mining activities in the region of South East Europe and result in the
clearance of at least 1 200 000 m2 along the borderlines. The project, for which the
Community contribution is €2 850 000, aims at increasing the security and freedom
of  movement  of  the  populations  living  in  the  border  areas,  enabling  the  return  of
internally displaced persons and refugees, simplifying police controls at the borders,
releasing  land  for  agricultural  purposes  and  stimulating  economic  activities  in  the
border areas. Mine clearance will take place in the border areas between the Federal
Republic of Yugoslavia and Croatia, between Albania and Kosovo, as well as in the
border area between Bosnia and Herzegovina and Croatia.

119

De-mining  activities  in  former  conflict  areas  were  also  funded  in  the  former
Yugoslav Republic of Macedonia as part of the process of stabilisation of the country
and in order to enable the return of refugees and internally displaced people to their
pre-conflict dwellings.

– 

Refugees/Population

The  displacement  of  populations  is  one  of  the  major  consequence  of  the  wars  that
tore the Balkans during the 1990s, and therefore remains one of the main priorities of
EC  assistance.  It  is  not  only  important  that  the  refugees  and  internally  displaced
persons (IDPs) can go back to their homes, but also fundamental for the achievement
of  peace  that  displacement  by  force  is  not  accepted  and  recognised  as  permanent.
Therefore,  the  EC  has  put  special  emphasis  on  the  return  of  properties  to  their
pre-war  occupant.  With  the  implementation  of  the  property  laws  and  an  increased
stability,  return  has  finally  taken  a  real  take  off.  Some  areas,  however,  remain
difficult  with  real  political  and/or  legal  obstacles  to  people  and  property  return.
1 250 000  persons  are  still  displaced  within  the  countries  of  former  Yugoslavia
(excluding Kosovo).

In  Croatia,  the  rehabilitation  of  the  technical  infrastructure  complements  the
reconstruction of houses. One of the recently completed projects is the rehabilitation
of  the  water  distribution  network  in  the  town  of  Knin  (€200  000).  With  the
construction of a one million-litre water tank, up to 15 000 inhabitants of Knin will
be provided with potable water, including 8 500 returnees to this population centre.
This kind of projects prepare the ground for the return of additional 5 000 refugees
that are expected to return to the municipality, and significantly increase the chances
for sustainable socio-economic development.

The return of mainly ethnic Serbs is still hampered by political, economic, legal and
social obstacles. As of March 2002, out of 292 566 persons who returned to the war-
affected areas, only 90 271 were minority returns (the rest being Croatians and ethnic
Croats).

In  the  former  Yugoslav  Republic  of  Macedonia,  the  implementation  of  the
emergency  assistance  package  worth  €26.5  million  (€12.7  million  under  the  Rapid
Reaction  Mechanism  from  the  Common  Foreign  and  Security  Policy  budget  and
€13.8 million under CARDS) adopted in 2001 has proceeded rapidly  and helped in
getting 95% of the IDPs to their pre-conflict residences. Projects such as electricity
rehabilitation,  housing  reconstruction  and  water  supply  improvement  facilitated
large-scale returns to former conflict areas over the course of 2002.

In  Bosnia  and  Herzegovina,  the  EC  assistance  directly  enabled  the  sustainable
return  of approximately  8 000 people and has  contributed  to  the  overall return  of
some  100 000  persons.  In  addition,  more  than  2 700  jobs  were  created  for  both
returnees (80%) and local community representatives (20%).

The EC is now working on handing over the responsibility of the return issue to the
local authorities. The Bosnia and Herzegovina Council of Ministers has established a

120

Return  Fund,  and  a  Protocol  of  cooperation  has  been  established  with  the  main
international agencies involved in return aid.108

In  FRY-Kosovo,  the  EC  assistance  is  double-folded.  On  one  hand,  the  European
Commission  is  allowing  grants  for  reconstruction/repair  of  damaged  houses  for
special  beneficiaries.  On  the  other  hand,  the  EC  is  establishing  a  housing  loan
scheme supporting people to reconstruct, extend or renovate their housing.

In  addition,  in  other  parts  of  FRY,  as  well  as  the  former  Yugoslav  Republic  of
Macedonia,  ECHO  has  provided  assistance  to  refugees.  Before  the  year  2002,  the
EC  conceived,  financed,  and  implemented  its  support  to  refugees  and  IDPs  within
the country assistance.

After  having  focused  its  attention  on  reconstruction,  the  EC  has  directed  its  aid
towards  an  integrated  approach  of  return,  including  job  creation  and  social
integration, that have been deemed an  absolute pre-condition for sustainable return.
In 2002, it has been deemed necessary to support inter-country return and to tackle
cross-border  issues.  The  2002  Regional  envelope  (€1  million)  will  focus  on
favouring a better coherence of the different legal frameworks and implementation of
the property rights, and to support regional refugee return initiatives.

6.1.5.

The Three Cs (Coherence, Coordination and Complementarity in the Region)

6.1.5.1 Cooperation with Member States and other Donors in the Region

Coordination  of  policy  and  action  amongst  Member  States  and  other  Donors  and
International Financial Institutions is of crucial importance in the Balkans. In Bosnia
and Herzegovina, the Office of the High Representative is mandated to coordinate
the  implementation  of  the  civilian  annexes  of  the  Dayton  Peace  Accord.  It  has
streamlined a framework of task forces which focus on the core challenges facing the
country, and within which the Commission plays an important role. Additionally, the
Commission  organises  specific  coordination  meetings  with  the  Member  States  in
order to seek complementarity between projects and to appraise  the Member  States
of  project  progress  and  future  programming  lines.  Each  meeting  includes  a  focal
theme for discussion and reflects the programming of the CARDS.

In  Croatia, the  EC  Delegation  is  maintaining  a  permanent  communication  channel
with the donor community as well, in particular with major donors such as USAID
and  International  Financial  Institutions,  the  World  Bank,  the  EBRD  and  the  EIB.
Interaction  takes  place  at  operational  and  decision  making  level,  from  intensive
consultations  on  the  occasion  of  programming,  to  more  sector  and  project-based
exchange of information and coordination.

In  the  former  Yugoslav  Republic  of  Macedonia  coordination  of  the  international
aid effort is part of the mandate of the EU Special Representative and is carried out
on  the  basis  of  regular  ad  hoc  meetings.  It  involves  the  monitoring  of  the  political
process in the country and the implementation of the Framework Agreement (Ohrid,
2002).  The  EC  Delegation  is  responsible  for  the  coordination  of  donors  (and
implementing  agencies)  in  the  area  of  housing  reconstruction,  including  financial
aspects and solution of problems on the ground. Further coordination meetings take

108

The hand-over to local authorities should be achieved by 2004.

121

                                                
place  on  decentralisation  and  local  self-government,  and  on  police  reform  with  the
OSCE  and other donors at institution and donor  levels.  The  European  Commission
and  the  World  Bank  organised  a  donors  meeting  in  Brussels  (12  March  2002)  to
collect  pledges  for  reconstruction  after  the  2001  conflict,  and  for  macroeconomic
assistance and support for implementation of the Framework Agreement. Pledges are
followed up locally by the authorities of the former Yugoslav Republic of Macedonia
with support from the EC Delegation, the World  Bank  office  and  technical  support
by the UNDP.

The  EAR  organises  regular  meetings  with  Member  States  and  other  donors  to
discuss,  among  other  things,  annual  programme  proposals  to  avoid  overlaps  with
other donors’ programmes and ensure that activities are complementary.

6.1.5.2 EIB activities

The European Investment Bank continues to play an important role in  the  Balkans,
lending  significant  funds  in  close  cooperation  with  the  Commission  and  other
multilateral financing institutions. In 2002 it was still concentrating on transport and
telecommunications,  energy  production  and  distribution,  industry  (in  the  form  of
direct loans and joint ventures with European partners) and environmental protection.

Projects  carried  on  in  2002  under  the  Quick-Start-Package  funding  included  a
transport  infrastructure  regional  study  to  identify  transport  investment  priorities  in
south-east Europe at a cost of €2.3 million.

In  Montenegro,  the  European  Agency  of  Reconstruction  is  giving  the  Ministry  of
Maritime and Transportation and the Ministry of Economy long-term term technical
assistance  to  support  reform  and  assist  in  the  disbursement  of  EIB  loans  worth
€35 million in the road and rail and energy sectors, .

6.1.5.3 Humanitarian Aid in the Region

ECHO continued to phase  out  its  operations  in  the  Balkans  following  the  return  to
normality in the region and the decline in humanitarian needs. As a consequence, the
total  budget  allocation  of  €43  million  was  half  that  of  2001.  ECHO  completed
withdrawal from Kosovo, Albania and  Montenegro and continued  phasing  down in
the  former  Yugoslav  Republic  of  Macedonia  and  Serbia.  Throughout  the  region,
ECHO paid close attention to the link between relief and development.

Most humanitarian aid for the  region went to  Serbia (€37 million)  where there  are
still large numbers of refugees and displaced persons. The funds were used to cover
the  humanitarian  needs  of  the  most  vulnerable  people  (food  aid,  hygiene  products,
wood and  other heating  fuels), build on  previous  health  and  psychosocial  activities
and seek permanent solutions for refugees, both in the form of housing programmes
in Serbia and help for refugees from Bosnia and Croatia to return home. The next
largest  beneficiary  of  humanitarian  aid  in  the  region  was  the  former  Yugoslav
Republic of Macedonia (€3 million), where ECHO continued to build on its water
supply and social sector projects. Refugees from Kosovo and  those  affected  by  the
consequences of the conflict in 2001 continued to be assisted by the UNHCR. ECHO
focused its efforts in this area on three priorities: emergency rehabilitation, food aid
for  displaced  persons  staying  with  host  families  and  agricultural  assistance  (seeds
and  animal  fodder)  for  displaced  persons  and residents  of  the  areas  affected  by  the

122

conflict. In Kosovo, despite ECHO’s withdrawal at the end of 2001, a last allocation
of  €2  million  was  made  to  the  UNHCR  in  support  of  its  activities  to  protect
minorities.  In  Albania  and  Montenegro  the  activities  financed  in  2001  were
completed in preparation for ECHO’s withdrawal.

European Community Humanitarian Office (ECHO)
Financing Decisions 2002

Country

Serbia

Kosovo

FYROM Macedonia

Regional

Total

€ million

37 000

2 000

3 000

1 000

43 000

6.1.6

Results Oriented Monitoring (ROM)

In  2002  EC  assistance  to  Albania  and  Croatia  was  still  monitored  under  the  ROM
system.  The  ROM  was  also  introduced  in  Bosnia  and  Herzegovina  in  September
2002 and  in  CARDS regional programmes in  December  2002.  In  total,  33  projects
(value  €73.2  million)  were  monitored  and  37  reports  were  produced  over  the  year.
(The majority (30) of these projects were, however, financed under the old Phare and
Obnova programmes,109 and so the data should not be used to judge the performance
of the CARDS programme as such.)

The  average  rating  for  all  projects  was  2.2,  well  below  the  median  point  of  2.5.
However, it may be noted that the three new projects financed through the CARDS
Programme do significantly better than the regional average.

In  Bosnia  and  Herzegovina,  25  monitoring  assignments  were  completed  in  2002
under the BiH Monitoring Support Project, which was in place from February 2000
until September 2002 when the new ROM started. The total contractual value of the
assistance  monitored  was  €191.5  million;  hence  the  cost  of  monitoring  represented
0.96% of the value of assistance in BiH.

The  projects  score  best  with  respect  to  Relevancy  and  Quality  of  Design  and
Efficiency  of  Implementation  (2.4),  but  low  concerning  Effectiveness,  Impact  and
Potential  sustainability,  averaging  2.1  for  each  indicator.  The  sub-criteria  reinforce
the  conclusion  that  in  general  the  projects  are  adequately  designed  but  are  being
implemented  weakly  and  are  failing  to  deliver  the  expected  results  and  have  wider
effects. As result there is little to sustain.

It  is  difficult  to  pinpoint  the  precise  reasons  for  this  weak  performance  given  the
relatively small sample. However, it may be a reflection of the fact that these projects
were  being  implemented  in  extremely  sensitive  political  circumstances  in  Albania,

109

Council Regulation EC No 2666/2000 of 5 December 2000 replaced existing Community assistance to
the Western Balkans, the Phare and Obnova programmes, by the CARDS programme.

123

                                                
Bosnia  and  Herzegovina  and  Croatia,  frequently  in  the  absence  of  supportive  and
experienced project partners. There are also  concerns that the weak performance of
some projects is – also – due to the weakness of project contractors.

Of the 37 reports produced, 28 address two priority areas: trade and development (9
reports) and institutional capacity and good governance (15 projects, 19 reports). The
projects in support of trade and development tend to perform significantly better than
the  average.  The  projects  are  well-designed  (2.7)  and  implemented  efficiently  (2.6).
However,  they  score  less  well  for  impact  (2.4)  and  sustainability  (2.1).  It  suggests
that  the  institutional,  human  or  budgetary  resources  necessary  to  sustain  project
results have still to be put in place.

The  projects  in  support  of  institutional  capacity  and  good  governance  are  not
progressing  well:  The  overall  average  (2.0)  is  well  below  the  median  point  of  2.5.
The  reports  are  pessimistic  about  the  probability  that  these  projects  will  deliver
results (2.1), achieve the project purpose (1.7), have impact (1.8) or be institutionally
or financially sustainable (1.9). The reports identify a number of reasons: contractors
with little understanding of what is required to build institutional and human resource
capacity;  a  tendency  for  the  projects  to  become  politicised;  a  focus  upon  political
advice rather than technical assistance; the creation of parallel structures; high staff
turnover due to low public sector pay.

Although  there  are  projects  in  three  other  priority  areas  -  macroeconomic  policies
and  social  sectors  (two),  transport  (one)  and  food  security  and  sustainable  rural
development (five) - the samples are too small to draw anything but the most general
conclusions. The projects appear to be well designed and are progressing on time and
at  planned  cost,  but  score  less  well  on  probable  effectiveness,  impact  and
sustainability.

BOSNIA AND HERZEGOVINA
“Regional development – Brcko”

The objective of the project was to support the sustainable development of Brcko district by
drawing  up  a  regional  development  strategy,  providing  services  to  small  and  medium  sized
enterprises (SMEs) and creating a  local  development  agency.  The  project  purpose  has  been
achieved  in  full.  The  regional  development  policy  is  already  being  implemented:  an
investment of €100 million to re-house the Arizona Market has been negotiated, an enterprise
zone  comprising  30  Italian  companies  is  being  established,  and  a  range  of  labour  market,
vocational  training  and  SME  support  measures  are  being  implemented.  The  Local
Development  Agency  is  highly  regarded  by  local  stakeholders  and  is  playing  an  active  role,
notably  with  respect  to  improved  business  registration  procedures  and  the  provision  of
support services to entrepreneurs and SMEs. The Agency has signed a number of contracts
with  the  Brcko  district  government  to  implement  elements  of  the  strategy.  The  many
unplanned  activities  carried  out  by  the  contractor  are  reinforcing  and  extending  the
achievement  of  the  immediate  objectives.  The  medium-term  financial  and  institutional
stability of the project results and achievements are assured as the Brcko district government
has  made  funds  available  from  the  district  budget  and  assigned  land  to  implement  key
elements  of  the  development  strategy.  The  project  was  rated  at  3.6  (well  above  the  median
point  of  2.5).  It  amply  demonstrates  the  key  attributes  of  a  successful  project:  realistic  and
well-focused  project  design,  a  committed  contractor  working  in  close  partnership  with  a
beneficiary  who  is  prepared  to  establish  a  supportive  project  environment  and  follow  up
project results.

124

6.1.7

Conclusions and Perspectives

The  year  2002  represents  a  turning  point  for  CARDS  assistance  to  the  region.
Assistance which up to now has had a strong focus on reconstruction and democratic
stabilisation,  in  particular  refugee  returns,  has  become  a  more  strategic  instrument
designed to facilitate, according to the countries’ specific needs, the Stabilisation and
Association process.

The design of the CARDS annual programmes in 2002 took account of lessons learnt
in reviewing the implementation of the EC assistance:

Albania:

Coordination  with  other  donors:  Although  the  prime  responsibility  for  donor
coordination lies with the Albanian government, the European Commission needs to
ensure  a  better  coordination  on  the  ground,  in  particular  in  the  field  of  public
administration  reform.  The  devolved  Delegation  will  be  particularly  well  placed  to
do this.

Cancelling  “old”  projects:  Following  internal  reviews  of  progress  made  in  the
implementation  of  previous  programmes,  the  Commission  proposed  to  cancel  a
number of “old” projects that had not yet started.

the  projects  directly  (tendering,  contracting, 

Devolving  management:  from  the  2001  programme  onwards,  the  Commission  is
managing 
implementation  and
payments) through its devolved Delegation. Together with a continued support to the
project counterparts through Project Management Units and Project Implementation
Units,  the  devolved  management  should  lead  to  a  better  and  quicker  programme
delivery.

Conditionality  of  assistance:  The  Multi-annual  Indicative  Programme  contains
specific conditions for the EC assistance. The Albanian government has been asked
to report on these conditions regularly before and during project implementation.

Bosnia and Herzegovina:

“Participatory” preparation of the annual programme: The programming of the
2002 CARDS assistance was conducted in a transparent and participatory way. The
national authorities were  more closely involved in project identification  than  in  the
past, for instance several round table discussions were organised with the authorities
and other donors.

Mid-term  planning  and  duration  of  the  projects:  Project  identification  has  been
undertaken with a view to the programming of the 2003 Annual programme. Like the
2001 programme, the projects within the 2002 programme have on average a longer
duration than in the past, to ensure continuity of the assistance and to avoid contract
extensions, the processing of which could lead to interruptions and thus to damage to
the effectiveness of the assistance.

Sustainability aspects: The 2002 annual programme addresses sustainability aspects
within each sector.

125

Croatia:

In addition to improvements similar to those made in preparation of the Bosnia and
Herzegovina  programme,  the  2002  programming  for  Croatia  built  on  experience
acquired  in  the  course  of  previous  years’  programming  and  on  the  training  of  the
Croatian counterparts in project cycle management.

The former Yugoslav Republic of Macedonia:

A series of problems has been addressed: the clear need for an overall strategy with a
policy framework and government commitment to the reform objectives; the need
for  ongoing  commitment  to  donor  coordination  and  consultation  meetings  at
programme  and  sector  levels;  the  need  to  base  annual  programmes  on  transparent
consultations with stakeholders and on the absorption capacity of the government
institutions; and the need to adequately supervise, monitor and evaluate project
implementation including financial control systems.

There is now an established and  functioning framework for aid coordination within
the  former  Yugoslav  Republic  of  Macedonia  Government.  The  Deputy  Prime
Minister  acts  as  National  Aid  Coordinator  as  well  as  being  Minister  for  European
Integration.

FRY - Serbia and Montenegro:

To maximise effectiveness, the EC and the competent implementing authorities must
continue to target EC assistance on a restricted number of sectors.

Programme  design  and  implementation  must  always  ensure  that  the  intended
recipients of the assistance are involved in a manner that enables them to maintain a
real  sense  of  ownership  of  the  process  and  to  transfer  knowledge  and  develop
their capacity.

When  proceeding  with  physical  infrastructure  rehabilitation  efforts,  it  needs  to  be
clear  that  the  relevant  authorities  are  genuinely  committed  to  the  medium  and
long-term measures required to ensure sustainability of the interventions.

Close coordination of programmes with other donors is still critical if Serbia and
Montenegro is to maximise the benefits it receives from the combined international
assistance effort.

For  all  the  Western  Balkan  countries,  the  existence  of  a  market  economy  and  its
proper functioning is one of the criteria fixed at Copenhagen as basic prerequisite for
EU  membership.  The  coming  years  will  therefore  see  continued  support  for  the
practical  reforms  needed  to  achieve  this,  inter  alia  economic  related  legislation,
budget expenditure management and revenue collection, public procurement and – at
the more advanced stages of the process – competition legislation.

Attention will also be focused on the excessive size of public administrations, usually
through  public  administration  reform  programmes  to  rationalise,  downsize  and
streamline the public sector.

Administrative capacity does not just depend on having sufficient numbers of staff –
it  is  also  important  that  they  are  sufficiently  well  trained  and  have  the  necessary

126

facilities  to  function  effectively.  A  lack  of  adequate  administrative  capacity  has
serious implications, not just for the Stabilisation  and Association process, but  also
for  the  general  functioning  of  government  and  the  economic  reform  process.  In
recognition of this fact, substantial support is expected for this critical area in future
years, ranging from basic provision of equipment and specialised training to support
to  public  administration  reform  institutions  in  the  region.  Support  for  the
development  of  basic  legislation,  and  in  particular  of  appropriate  and  robust  civil
service codes, will also constitute an important element of support.

In  the  area  of  justice  and  home  affairs,  the  weak  functioning  of  the  judiciary  is
recognised as one of the key problems hindering not just general political functioning
of  the  state,  but  also  the  proper  functioning  of  a  market  economy  e.g.  lack  of
effective  economic  conflict  resolution.  Corruption  has  been  identified  as  another
major problem that hinders proper political social and economic development in the
region.  Organised  crime  generally  also  continues  to  have  a  destabilising  effect  on
political,  social  and  economic  developments.  It  requires  decisive  action  by  the
International  Community,  supported  by  targeted  CARDS  assistance,  to  attack  the
roots of the problem and facilitate sustainable solutions.

6.2.

EASTERN EUROPE AND CENTRAL ASIA

In  2002,  the  European  Union  promoted  its  political,  economic  and  commercial
relations  with  the  countries  of  Eastern  Europe,  the  Caucasus  and  Central  Asia110
through  an  intensified  dialogue  and  cooperation.  The  implementation  of  the  EU’s
Common Strategies with Russia and Ukraine and of the Partnership and cooperation
Agreements  (PCAs)  with  most  of  the  countries  of  the  region  continued  through  a
series of summits, councils, committees and subcommittees.

In the light of 11 September 2001, the EU has prioritised the fight against terrorism,
drug  trafficking  and  illegal  migration  notably  in  relations  with  Central  Asia.  In
EU-Russia  relations,  the  concept  of  the  Common  European  Economic  Space
(CEES),  the  EU-Russia  Energy  Dialogue,  the  EU’s  recognition  of  Russia’s  market
economy  status  and  the  question  of  the  Kaliningrad  enclave  were  of  particular
importance.  In  Russia,  Ukraine,  Moldova  and  Belarus,  the  EU  has  analysed  the
potential  impact  of  enlargement,  leading  to  the  development  of  the  concept  of
“Wider Europe”. In both the Caucasus and Central Asia, conflict resolution and the
consolidation of democracy dominated the agenda.

6.2.1.

Strategic goals and achievements

In 2002, Tacis continued to work towards the over-arching goal of assisting the NIS
in the transition towards market economy and plural democracy. Tacis supports the
implementation of the PCAs in force in nine of the NIS countries. Tacis assists these
countries  to  fulfil  their  obligations  under  the  PCA  agreements,  notably  in  terms  of
institution-building and economic reform.

In  addition  to  ongoing  support  for  the  PCAs,  there  are  three  achievements  of  the
Tacis programme in 2002 that are worth special mention.

110

Armenia,  Azerbaijan,  Belarus,  Georgia,  Kazakhstan,  Kyrgyzstan,  Moldova,  Mongolia,  Russia,
Tajikistan, Turkmenistan, Ukraine and Uzbekistan.

127

                                                
The Commission adopted a new Strategy for EC assistance to Central Asia, in close
collaboration  with  the  authorities  in  the  five  countries  of  the  region.  Within  six
weeks  of  this  strategy  being  agreed  with  the  Member  States,  the  Tacis  Committee
adopted  a  Tacis  Action  Programme  of  €50  million  for  Central  Asia  –  a  real
achievement in terms of promoting regional cooperation.

Tacis  marked  ten  years  of  support  to  the  nuclear  safety  sector  in  the  NIS  with  a
conference  in  Kyiv  in  July,  a  recognition  of  the  key  role  the  EC  has  played  in
pressing for vital reforms in this politically sensitive sector.

The  EC  also  played  an  active  part  in  the  launch  of  a  Northern  Dimension
Environmental  Partnership,  pledging  €50  million  (of  a  total  of  €110  million)  to
improve the environment around the Baltic Sea, notably through better management
of spent nuclear fuel and radioactive waste.

Ownership  is  always  key  to  the  success  of  assistance  programmes.  In  this  context,
one  should  highlight  the  significance  of  the  meeting  of  the  Tacis  National
Coordinators  in  Brussels  in  November  2002  –  gathering  the  key  counterparts  at
ministerial level from all  13  countries  of  the  NIS  and  Mongolia.  This  was  the  first
meeting for over two years, and an important milestone in the dialogue between the
EC and the partner countries that would enhance ownership of the Tacis programme
by the partner country authorities.

Furthermore, the Commission successfully completed internal management reforms,
resulting in new  responsibilities being given to the four EC  Delegations  in the NIS
region  (Moscow,  Kyiv,  Tbilisi,  Almaty).  This  will  also  help  ensure  that  both  the
design and the implementation of the programmes are well-adapted  to the needs of
the  partner  countries,  strengthen  the  dialogue  with  the  local  authorities,  while
facilitating coordination with other major donors.

128

TACIS COMMITMENTS AND PAYMENTS IN THE REGION 2002
(€ MILLION)

Programmes

Commitments

Payments

2002

2001

2002

2001

National action programmes

Armenia

Azerbaijan

Belarus

Georgia

Kazakhstan

Kyrgyzstan

Moldova

Mongolia

Russia

Tajikistan/Ukraine

Uzbekistan

Subtotal

Multi-country 
programmes

Cross-border

Baltic

Nuclear Safety

Central Asia

Regional + other

Chernobyl Shelter

ATA

Subtotal

Other budget lines
Food aid (audit)

Subtotal

TOTAL

action

10.0

14.0

0

14.0

see CA

see CA

0

6.0

90.0

see CA

-

67.0

see CA

201.0

-

-
27.5

8.0

56.0

50.0

151.1

20.0

15.9

228.5

-
0

0

0

0

0

4.0

14.0

9.1

19.5

0

80.0

0

-

63.0

0

189.6

-

-
23.0

6.0

51.0

0.0

101.7

40.0

12.2

233.9

-
0

0

3.3

8.6.

0.3

5.1

4.0

2.6

4.5

3.2

92.4

3.3

-

28.0

7.2

62.6

-

-
26.6

0

36.6

-

123.4

20.0

14.7

221.3

-
1.4

1.4

4.3

4.6

3.1

3.7

6.1

4.4

4.0

2.4

86.4

2.9

-

31.2

6.8

159.9

-

-
26.1

0

35.8

-

126.2

40.0

5.6

233.6

-
0

0

429.5

423.5

383.9

395.0

OVERVIEW COMMITMENTS/PAYMENTS 2002
(€ MILLION)

TOTAL

Commitments

Payments

1.296.8

1.231.3

2000

443.8

452.4

129

2001

423.5

395.0

2002

429.5

383.9

6.2.2

Programming priorities

The  Tacis  programme  is  the  main  Community  instrument  for  supporting  the
implementation  of  the  cooperation  priorities  in  the  region.  The  programme’s
objectives  are  to  support  the  transition  to  market  economy  and  to  reinforce
democracy and the rule of law. The Tacis programme can be divided into two main
categories: national and multi-country programmes. National indicative programmes
(NIPs)  highlight  objectives,  expected  results  and  conditionality  for  Tacis  in  the
priority areas of cooperation for the period 2002-2003 (2002-2004 for Central Asia).

Russia is a key actor for the stability and security of the entire European continent.
The  EU  has  an  important  strategic  and  economic  interest  in  the  development  of
Russia. The country is both an important trading partner for the EU, in particular in
terms of energy supplies, and a key partner in EU efforts to promote nuclear safety
and to fight organised crime, drug trafficking and illegal immigration in Europe.

the 

legal, 

reform  programme,  building 

The 2002-2006 Country Strategy Paper (CSP) for Russia supports the Government’s
socio-economic 
institutional  and
administrative framework necessary for the consolidation of a market economy and
democracy.  The  EU  also  has  an  interest  in  contributing  to  the  solution  of  Russia’s
serious  social  challenges,  e.g.  in  health,  education  and  social  welfare.  Within  that
context, the 2002-2003 Tacis National Indicative Programme for Russia focuses on:
(1)  legal,  administrative  reform  and  regional  policy;  (2)  judicial  reform;  (3)  civil
society, training and education; (4) deregulation and corporate governance; (5) social
reform;  and  (6)  municipal  services.  The  indicative  total  budget  for  the  two-year
period is €184 million.

Western NIS

The case for closer EU-Ukraine relations will be even greater after EU enlargement.
The  2002-2006  CSP  for  Ukraine  emphasises  trade-  and  investment-related  issues,
judicial  reform,  justice  and  home  affairs  (including  border  management  and
migration  questions),  development  of  civil  society  and  alleviation  of  the  social
impact of reforms. The National Indicative Programme for 2002-2003 identifies the
following  priorities:  (1)  legal,  judicial  and  administrative  reform;  (2)  border
management; (3) business, trade and investment promotion; (4) civil society, training
and  education;  and  (5)  social  reform.  The  last  EC  contribution  to  the  closure  of
Chernobyl was made in 2002. The indicative budget for the Ukraine programme for
2002-2003 is €115 million.

In Moldova, all available EC cooperation instruments should be used to contribute to
the political, economic and financial stabilisation of the country. Tacis assistance in
2002-2003 focuses on three priority areas: (1) institutional, legal and administrative
reform, including health sector reform, cross-border cooperation, fight against crime,
PCA support, civil society development and training; (2) private sector and economic
development,  in  particular  enterprise  development  in  rural  and  urban  areas  and
export  promotion;  and  (3)  alleviation  of  the  social  consequences  of  transition,
including  poverty  reduction,  social  assistance  and  childcare.  The  indicative  budget
for the two-year period is €25 million.

130

The  EU  has  a  clear  interest  in  Belarus’  political,  social  and  economic  progress
towards  a  democratic  state  and  a  market  economy,  not  least  since  Belarus  will
become  a  direct  neighbour  after  EU  enlargement.  In  2002,  however,  the  EU  was
seriously concerned about the continuing deterioration of democracy and rule of law
in  Belarus.  Under  these  circumstances,  the  Commission  decided  to  postpone  the
preparation  of  a  CSP  and  a  Tacis  Indicative  Programme  to  a  later  date.  The  EU,
including the Tacis programme,  remains  committed, however,  to  providing  support
and  assistance  to  Belarus  civil  society.  In  2002,  such  activities  were  still  financed
from the 2000-2001 budgets.

Central Asia

Following  the  events  of  11  September  2001,  the  Commission  reflected  on  how  to
best  face  the  development  problems  of  Central  Asia.  While  the  specific  issues
facing each country vary,111 the same kind of problems are  experienced throughout
the  region:  slow  democratic  and  economic  transition,  poor  human  rights  records,
concern  over  Islamic  radicalisation,  widening  income  disparities  and  poverty  in
general.  In  2002,  the  Commission  prepared  a  regional  strategy  with  an  Indicative
Programme for 2002-2004. A total of €150 million has been allocated to implement
the programme over the three-year period.

The  core  objectives  of  EC  assistance  to  Central  Asia  are  to  promote  security  and
conflict  prevention,  to  eliminate  sources  of  political  and  social  tension,  and  to
improve  the  climate  for  trade  and  investment.  The  assistance  consists  of  three
components:  (1)  a  regional  cooperation  programme  designed  to  promote  good
neighbourly  relations  and  concertation  between  the  countries  in  areas  such  as
transport  and  energy  networks,  natural  resources,  international  environmental
conventions,  and  justice  and  home  affairs;  (2)  a  regional  support  programme,
implemented at national level, and designed to address the main common challenges
to  sustainable  economic  development,  including  investment  and  trade  promotion,
customs  and  border  management  and  reform  of  the  education  sector;  and  (3)  a
poverty reduction scheme piloted in two to three target regions.

The  main challenges  for the  coming  years  faced by  Mongolia  are  to  overcome  the
problems of the agriculture and livestock, to tackle the issue of poverty reduction and
to  fight  corruption.  Given  the  modest  budget  available,  €6  million  for  2003-2004,
Tacis assistance is focused on one priority area, namely rural development, including
support  to  rural  SMEs,  employment  generation  and  protection  of  the  environment.
After  this  period,  EC  assistance  to  Mongolia  will  be  provided  under  the
Community’s Asia programme.

Caucasus

For all three Caucasus countries, the Commission  has limited itself, given  the tight
budget  constraints,  to  only  two  priority  areas  of  cooperation.  In  all  three  countries
support  for  institutional,  legal  and  administrative  reform  is  a  priority.  In  both
Armenia  and  Georgia,  the  second  priority  area  is  support  for  tackling  the  social
consequences of transition, with poverty being a key element of the CSP. Health is
given particular attention in Georgia, while the emphasis is on education in Armenia.

111

Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan.

131

                                                
In Azerbaijan, the second priority area is support to the private sector and assistance
for economic development, notably to assist with the diversification of the economy
from the oil and gas sector. A budget of €14 million is provided for in the NIPs for
both Azerbaijan and Georgia, and €10 million is allocated for Armenia.

Over  the  2002-2006 period in  Armenia one of the  main  EU  objectives  remains  the
closure  of  the  Medzamor  Nuclear  Power  Plant.  The  EU  will  also  look  for  further
ways in which it could support efforts to prevent and resolve conflicts as well as in
post conflict  rehabilitation in Armenia,  Azerbaijan  and  Georgia.  Georgia’s political
situation  in  2002  was  dominated  by  internal  conflicts,  widespread  corruption  and
deterioration of security, including that of EU citizens working for Tacis. Hence, the
existing  2002-2006  CSP  will  be  revised  in  2003.  Throughout  the  Caucasus  region,
the  EC  will  ensure  complementarity  between  the  Tacis  programme  and  the  Food
Safety Programme.

Multi-country programmes

The Nuclear Safety Strategy Paper confirms the need to maintain EU involvement
in  supporting  the  ongoing  development  of  a  nuclear  safety  culture  in  the  partner
states, above all Russia and Ukraine. Closure of first generation reactors and support
for  the  modernisation  of  second  and  third  generation  reactors  are  among  the
priorities.  Other  fields  of  cooperation  include  spent  fuel  and  waste  management,
to  safeguard  measures  and  off-site  emergency  preparedness  and
assistance 
is
preparation  of  decommissioning.  The 
€140 million.

indicative  budget  for  2002-2003 

The  Tacis  Regional  Cooperation  Strategy  Framework  for  2002-2006  addresses
some priority issues, which are shared by all or some of the partner states of Eastern
Europe and Central Asia. It focuses on the protection of the environment, networks
(telecommunications, energy and transport), justice and home affairs, private  sector
investment  and  conversion  of  the  activities  of  weapons  scientist  to  peaceful  work,
plus more specific cross-border issues related to the impact of enlargement. Separate
Indicative  Programmes  for  2002-2003  have  been  prepared  for  regional  cooperation
(€20  million),  cross-border  cooperation  (€58  million),  scientific  cooperation
(€20 million) and the EC/EBRD Investment Preparation Facility  (€20 million). Full
Strategy  Papers, 
treating  regional  cooperation  and  cross-border  cooperation
separately, will be launched in 2003.

Within the context of the Northern Dimension, which addresses the special regional
development  challenges  of  northern  Europe,  an  important  step  was  taken  when  the
first  pledging  conference  of  the  Northern  Dimension  Environmental  Partnership
Support  Fund  took  place  in  July.  Initial  contributions  totalling  €110  million  were
announced  by  the  European  Commission,  the  Russian  Federation  and  Denmark,
Finland, 
the  Netherlands,  Norway  and  Sweden.  The  European  Bank  for
Reconstruction  and  Development  (EBRD)  manages  the  two  parts  of  the  Fund,  the
environmental component and the nuclear component.

132

6.2.3 Main results in 2002

6.2.3.1 Country Strategies

In terms of technical assistance, the year 2002 was marked by the launch of the first
Country  Strategy  Papers,  following  the  adoption  of  the  new  methodology  in  2001.
Strategy Papers, analysing the situation and setting out the EU response, have been
developed  for  each  of  the  major  countries  and  programmes  an  cover  the  period
2002-2006,  except  for  Belarus.  The  work  was  started  in  2001  and  in  most  cases
concluded with the adoption by the Commission of the Strategy Papers by December
of that year. The formal adoption of the Nuclear Safety Strategy Paper took place in
January 2002. The Regional Strategy Paper for Central Asia was prepared during the
first half of 2002 and adopted in October.

6.2.3.2 Implementation

Disbursements in 2002 were at 97% of the 2001 level (€384 million compared with
€395 million in 2001).  The  slight reduction  was  due  to  payments  to  the  Chernobyl
shelter  fund  being  reduced  from  €40  million  to  €20  million.  The  2002  payments
accounted  for  86%  of  the  available  budget.  The  shortfall  was  mainly  due  to  two
payments  that  were  planned  for  2002  being  delayed  as  a  result  of  administrative
delays  in  the  beneficiary  states.  These  were  the  Ukraine  Fuel  Gap  programme
(€20 million) and the Black Sea Waste Water Treatment project (€7.5 million).

– 

Conflict Prevention, Good Governance and Rule of Law

Tacis support  to  good  governance  must  be  read  in  conjunction  with  the  substantial
work on public administration reform (see institution-building below). The European
Union is giving  continued attention to supporting  the rule  of  law  and  effective  law
enforcement in its  assistance  to  the  Newly  Independent  States  and  Mongolia  under
the  TACIS  programme.  Priority  areas  remain:  conflict  prevention  and  integrated
border management, combating drug trafficking and trafficking in human beings, and
the  development  of  a  comprehensive  migration  and  asylum  system  to  combat
smuggling of illegal migrants and reduce illegal migration flows.

Legal Protection of Economic Operators

Project partner: Legal Department of the Administration of the President

Four regions: Moscow, Saint-Petersburg, Krasnodar and Irkoutsk.

PROJECT OBJECTIVES

To  help  improve  the  legal  protection  of  economic  operators  in  the  Russian  Federation.  The
project has three components: improved implementation of the law affecting economic activities
in  four  selected  regions  (Saint-Petersburg,  Krasnodar,  Irkutsk  and  Moscow),  improved
application  and  enforcement  of  the  law  by  arbitration  courts;  improved  access  to  the  legal
system by making economic operators more aware of legislative matters and of the legal system
as  protector  of  economic  interests.  The  €5.37  million  project  was  implemented  between
30 December 1999 and end of June 2002.

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Analysis of results

The lawmaking component has been successful both in providing recommendations to Russian
lawmakers on various economic and legal topics (competition law, labour law, taxation of small
economic  operators,  bankruptcy  law,  administrative  disputes  involving  small  economic
operators, state liability, alternative dispute resolution, enforcement of Court decisions) and in
harmonising Federal Law and the laws of subjects of the Russian Federation.

The  training  component  has  had  significant  success:  training  for  30%  of  the  judges  of  the
arbitration  courts  system,  while  ensuring  the  sustainability  of  the  effort  through  a  specific
programme of “train the trainers”, which has produced 28 trainers able to continue the training
on the basis of the training materials produced by the project.

In  addition  to  the  Tacis  programme,  the  European  Initiative  for  Democracy  and
Human  Rights  (EIDHR)  supports  operations  in  support  of  human  rights,
democratisation  and  conflict  prevention.  Activities  are  carried  out  primarily  in
partnership  with  NGOs  and  international  organisations.  In  2002,  the  EIDHR
provided  almost  €13  million  for  projects  in  Eastern  Europe,  the  Caucasus  and
Central Asia.

Microprojects will be implemented by the Delegations of the European Commission
in three of EIDHR target countries: Georgia, Russia and Ukraine.

Almost €9.5 million were devoted to promotion and defence of human rights and
of  fundamental  freedoms.  Seven  projects  on  the  fight  against  racism,  xenophobia
and discrimination of minorities and indigenous people received financing of  about
€5.9 million and will be run in Russia, Ukraine, Armenia, Azerbaijan and Georgia.

Almost €2.7 million were devoted to the prevention of torture and to support for the
rehabilitation of the victims of torture, in particular in Russia, Georgia and Ukraine.

One  project  supports  individuals  who  register  complaints  against  Russia  in  the
European Court of Human rights, in particular through legal assistance.

Support  for  the  democratisation  process  and  strengthening  of  the  rule  of  law
received  more  than  €1  million.  Under  the  joint  2002  cooperation  programme
between  the  Council  of  Europe  and  the  European  Commission,  a  project  to
strengthen federalism, enhance democracy at regional and local levels, and improve
the  mechanisms  to  protect  human  rights  in  Russia  was  approved.  Another  project
continues  the  EC  support  to  the  Moscow  School  of  Political  Studies  to  ensure  the
continuation  of  education  on  human  rights.  A  project  in  Georgia  is  designed  to
improve  the  work  of  the  political  institutions  at  national  and  local  levels  and  to
strengthen the mechanisms of protection of human rights.

– 

Institution Building

This is a key area of Tacis support, including both public administration reform and
private-sector development.  In terms of  volume,  this  is  clearly  the  largest  sector  of
Tacis  assistance,  other  than  nuclear  safety.  Payments  for  the  70  ongoing  projects
totalled nearly €50 million.

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– 

Public Administration Reform

Tacis has provided support to enhance the administrative capacity and accountability
of the public administrations in  the region. One might  highlight  reform  of  the  civil
service  in  Armenia,  strengthening  the  regional  public  administration  in  Moldova,
support  for  government  reform  in  Ukraine  and  for  capacity  building  in  the
government  and  civil  service  in  Uzbekistan.  In  Russia,  the  Tacis  programme  is
actively  participating  in  a  major  reform  of  the  public  administration,  whose
improvement  has  been  announced  as  a  key  policy  priority  by  the  President.  In
October  2002  Tacis  launched  a  policy  advice  project  on  state  budget  reform  in
Russia as part of an ongoing commitment. Tacis has already offered policy advice on
public  procurement  reform  in  Russia,  and  it  continues  to  provide  advice  regarding
regulations  for  preventing  conflicts  of  interest  in  the  civil  service  and  on  public
access to information.

The Tacis programme needs to send a clear signal to partner countries that institution
building is high on its agenda, and that it will fully cooperate with partner countries
as they seek to recast their administrations and build institutional capacity.

– 

Private Sector and Economic Development

The  chief  obstacles  to  economic  development  across  the  NIS  include  the  outdated
regulatory environment, poor access to finance and investment and business practices
which block best practice. In seeking to combat these problems, Tacis has focused in
particular on three key issues: SME development, trade promotion, and reform of the
financial sector (notably banking and insurance). Within these three broader themes,
Tacis  has  given  particular  emphasis  to  consumer  protection  and  anti-monopolistic
regulations,  actively  encouraging  regional  investment,  in  addition  to  developing
access to foreign investment. Tacis support covers a broad range, illustrated by these
three examples: SME development in Moldova, audit reform in Russia, and support
for  the  Kyrgyz  Agricultural  Finance  Corporation.  The  project  in  Kyrgyzstan  has
done some pioneering work on access to credit outside the formal banking sector.

A theme of special importance is the role of Tacis in seeking to facilitate accession of
countries  from  the  NIS  region  to  the  World  Trade  Organisation.  Tacis  has  assisted
Russia  in  making  significant  progress  towards  the  goal  of  accession,  through  a
demand-driven  project,  which  focused  on  the  technical  aspects  of  issues  such  as
dispute  settlement,  and  sanitary  and  phytosanitary  measures.  Tacis  also  provided
support  to  other  states  at  different  stages  of  accession  to  WTO.  Future  assistance
cases  such  as  those  of  Moldova  and  Armenia,  now  WTO  members,  will  focus
increasingly  on  building  those  countries’  capacity  to  work  effectively  within  the
constraints of the WTO agreements and organisation.

Georgian Export Promotion Agency (GEPA)

GEPA  supports  Georgian  export-oriented  industries  and  improve  Georgia’s  foreign  trade
balance.  GEPA  was  founded  in  1999  by  the  Georgian  government  with  the  support  of  the
European Union’s Tacis programme. It offers a wide range of services to promote foreign trade.
Its  information  services  provide  both  Georgian  and  foreign  companies  with  the  latest
information  on  markets  and  regulations  in  foreign  and  Georgian  markets.  GEPA  organises
business visits and makes financial contributions to the participation of Georgian companies in
international trade exhibitions.

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Through training courses GEPA helps businesses, civil servants and commercial banks extend
their  expertise  and  capacity.  GEPA’s  innovative  cost-sharing  grants  scheme  helps  companies
design  their  marketing  and  export  strategies,  catering  to  their  niche  in  foreign  markets.  The
companies pay for their participation in the programme during which they draw up an “export
capacity  audit”,  receive  in-company  training  and  devise  marketing  strategies.  If  the  strategy
meets GEPA’s requirements, the company is then reimbursed 50% of the fees for participation.
Currently, 16 companies are participating in the scheme.

77 Rural Savings and Credit Cooperatives founded in Russia – Results of the Project on Rural
Cooperative Credit Strategies

In today’s Russia rural areas are lacking financial infrastructure. Neither private farmers nor
rural  entrepreneurs  have  access  to  credit  or  opportunities  to  place  their  savings.  The  existing
banking system is  mainly concentrated  in  the  cities;  banks  are  reluctant  to  launch  small-sized
credit in general and in rural areas particularly.

To overcome this bottleneck, the Commission and the Russian Government designed a project
to promote the establishment of rural credit cooperatives and improve the framework for credit
cooperatives  regionally  and  nationally.  Credit  cooperatives  are  self-governed  units  of  mutual
aid.  Members  share  mutual  responsibility.  Credit  cooperatives  have  a  long  history  in  Europe
(Crédit Agricole, Raiffeisen, Irish Credit League, Rabobank etc.) In Russia, a credit cooperative
system  existed  until  1917.  Since  1996  the  first  steps  have  been  undertaken  to  recreate  rural
credit cooperatives in some regions.

Together,  the  project  partners  and  beneficiaries  -  the  Ministry  of  Agriculture,  regional
agriculture  administrations,  the  National  Association  of  Rural  Credit  Cooperatives  and
hundreds of farmers and rural entrepreneurs all over Russia, achieved sustainable results with
this project.

77  new  credit  cooperatives  have  been  founded  all  over  Russia,  50%  of  all  rural  credit
cooperatives existing today,

four regional-level associations (Yaroslavl, Saratov, Buryatia, Novosibirsk) have been created as
joint cooperatives of the local credit cooperatives,

3500 trainees have successfully participated in  more than 100 seminars  covering  all  aspects  of
setting up credit cooperatives and managing them,

regional laws in Saratov, Altaiskij Krai Buryatia Republic and Yaraslavl have been drafted and
approved by the regional Duma,

after  long  and  difficult  negotiations,  discussions  and  seminars,  a  national  credit  cooperative
framework law has been successfully presented to the national Duma,

one national and three regional credit cooperative training centres have been established,

the 39 credit cooperatives located in the four pilot regions made more than 2000 loans in 2002,
With the size of the loans averaging nearly €1500, that makes a total of more than €3.5 million.
This means that the total volume lent through the credit cooperatives increased 14-fold during
the  life  of  the  project  (1999  –  2002),  while  the  number  of  loans  launched  increased  nearly
fivefold.

the repayment rate was 97% on average for all credit cooperatives over the years.

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– 

Regional cooperation/Integration

Tacis  supports  the  objective  of  regional  cooperation  through  three  principal
programmes:  the  Tacis  regional  programme,  which  provides  support  to  all  13
countries  of  NIS  and  Mongolia;  the  Tacis  crossborder  cooperation  programme
(targeting  Russia,  Ukraine,  Moldova  and  Belarus,  which  border  the  current  EU
candidate countries); and the Baltic cooperation programme, of particular importance
in the context of the Northern Dimension. The Tacis regional programme focuses on
three  priority  areas:  justice  and  home  affairs,  environment  and  development  of
networks.  The  crossborder  cooperation  programme  addresses  issues  of  border
management,  environment  and  crossborder  economic  development.  In  terms  of
volume,  Tacis  supports  over  80  ongoing  projects,  60  of  which  are  small-scale,
targeted  initiatives  for  crossborder  cooperation,  with  payments  totalling  about
€25 million.  In  addition,  in  2002  Tacis  wound  up  around  30  regional  cooperation
projects, with payments amounting to €35 million.

Justice and Home Affairs

The fight against organised crime activities is a key priority for the EU in its relations
with the NIS region. The objective is to develop a coherent approach in the countries
of  origin,  transit  and  destination.  This  approach  aims  to  reinforce  local  capacity  to
face  the  structural  problems  of  poverty,  unemployment  and  lack  of  education,  and
the rise of new criminal activities.

This approach implies:

– 

– 

– 

– 

a balanced implementation strategy embracing the rule of law, in particular by
means of legal assistance and training of judges or law enforcement officers in
order  to  strengthen  their  capability  to  enforce  national  legislation  complying
with international standards and human rights,

the equipment and training of law enforcement agencies in order to allow them
to  fight  more  efficiently  against  organised  crime,  drug  trafficking  and
trafficking  of  human  beings,  at  the  national,  regional  and  international  level,
notably by the improvement of their coordination and intelligence capacities in
partnership with their EU counterparts,

increasing  the  awareness  of  the  targeted  groups  in  the  populations  by
prevention and information campaigns, and finally,

the development of the national and regional capacities to assess the situation
and to elaborate appropriate national action plans and legislation.

From April 2002, the anti-drug activities have started again in Central Asia and have
been extended, with the same components, in Southern Caucasus, Ukraine, Moldova
and  Belarus.  The  combination  of  demand  reduction  and  supply  reduction  activities
allows a better acceptability of the programmes by the beneficiary countries and will
be complemented by the development of an epidemiological capacity component.

In Ukraine, Moldova and Belarus, future neighbours of the enlarged EU, emphasis is
being placed on the preparation of an integrated border management policy and the
setting up of a comprehensive migration and asylum system to combat smuggling in

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illegal  migrants  and  to  reduce  illegal  migration  flows,  both  at  the  regional  and
national levels.

In  parallel,  after  the  implementation  in  2001  of  a  first  anti-trafficking  project  in
Ukraine,  with  the  support  of  the  International  Organisation  for  Migration,
comprehensive  projects  are  being  carried  out  to  combat  trafficking  in  women  in
Moldova  and  Belarus.  These  projects  are  completely  in  line  with  the  earlier
mentioned strategy. This EC initiative paves the way for further actions in this field.

Further  assistance  through  the  work  of  the  Cross  Border  cooperation  programme
continued  in  2002.  These  projects  concentrated  on  the  Tacis  priority  areas  of
Administrative Reform, and local and regional economic development. The projects
also aimed at addressing social needs and environmental issues.

The  EU  also  implemented  Cross  Border  Projects  of  a  considerably  larger  nature
including four projects of up to €2 Million. Worthy of note was the Odessa region,
which had some initial success in assisting economic development and cross border
trade relations with Ukraine and Romania.

This programme has increasingly become ‘demand driven’ with the emphasis firmly
on Russian, Ukrainian, Moldavian and Belarusian counterparts to identify needs and
take  a  lead  on  project  management  and  identification.  Examples  of  these  projects
included projects aimed at tackling local unemployment blackspots such as Pskov in
Russia, a Centre for SME support and development in rural Moldova and a project in
tourism development in North West Russian, a region containing areas of unspoiled
lakes and forests.

– 

Transport and Infrastructure

As stated above, infrastructure development is an important aspect of Tacis Regional
cooperation,  with  support  being  focused  on  three  key  themes:  transport  (notably
through the TRACECA programme, for Transport Development in the Corridors of
Caucasus  and  Central  Asia);  energy  (in  particular,  through  the  INOGATE
programme  for  oil  and  gas  development  in  the  NIS);  and  enhancement  of  border
crossing facilities, in particular in Russia, Ukraine, Moldova and Belarus.

Transport

Eleven  new  TRACECA  contracts  have  been  signed  with  a  total  budget  of  €14.2
million. The seven investment contracts concern the improvement of infrastructure of
Caspian and Black Sea ports, the construction of two bridges  and the  supply  of oil
tank wagons for the railways in Azerbaijan. The four Technical Assistance contracts
concern  the  creation  of  a  common  legal  base  for  transit  transportation,  feasibility
studies for road transport projects in Caucasus and for the rehabilitation of railways
in Central Asia and the railway transit oil logistical centre in Caucasus.

Two  feasibility  studies  were  launched  in  2002:  the  first  concerning  the  road  link
between  Baku,  Tbilisi  and  Yerevan  and  the  second  a  road  facilitation  project,
concerning the creation of road transport training centres.

As  regards  air  transport,  four  projects  were  completed:  two  in  Russia,  one  in
Azerbaijan  and  one  in  Uzbekistan.  Of  these,  one  might  highlight  the  provision  of
training to the Civil Aviation Authority in Uzbekistan, enabling them to operate with

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the  internationally  recognised  International  Civil  Aviation  Organisation  (ICAO)
practices.  The  Azerbaijan  project  was  not  so  successful  and  was  terminated  before
completion  due  to  lack  of  support  from  the  Government.  The  project  had  the
ambitious objective of setting up of the Ministry of Transport, and it had to be closed
because the reform of the sector was progressing too slowly.

Two  transport  projects  were  completed  satisfactorily  in  Russia:  the  introduction  of
Western  European  specification  for  roads  design  and  construction  and  the
preparation  of  legislation  on  behalf  of  the  Ministry  of  Transport  for  regulating
surface transport.

Border-Crossings and Infrastructure

In 2002 with regard to completion of infrastructure projects funded under the Cross
Border  cooperation  programme  ten  contracts  were  closed  as  construction  works,
including  equipment  supply,  at  border  crossings  in  Russia,  Moldova  and  Ukraine
were completed. Another similar on-going project in Kaliningrad is on schedule and
will be completed by mid 2003 while construction of a waste water treatment plant in
north-west Russia should also be completed by November 2003.

One project in Russia had to be  closed before reaching implementation as the local
recipient  demonstrated  a  clear  lack  of  interest  in  fulfilling  their  co-funding  duties.
Despite  strong  pressure  being  applied  on  the  concerned  authorities,  it  was  also  not
possible  to  commit  new  projects  in  2002  due  to  land  issues  problems  or  lack  of
proper design dossiers. Both aspects are entirely into the hands of the recipients.

– 

Food Security and Rural Development

During 2002, there were ongoing Tacis Agriculture and Rural Development projects
in  Russia,  Ukraine,  Moldova,  Kazakhstan,  Kyrgyzstan,  Turkmenistan,  Uzbekistan
and Mongolia. In terms of volume, there were just over 10 on-going projects in this
sector,  with  payments  totalling  over  €15  million;  almost  15  projects  were  closed,
with  payments  totalling  over  €20  million.  Most  of  them  concentrated  on  the
traditional  sector  topics  such  as  agricultural  advisory  services,  crop  and  livestock
development,  agricultural  education  and  research,  seed  development,  on-farm
irrigation,  food  processing  and  the  establishment  of  marketing  structures.  The  first
dedicated Rural Development project also started during the year in Uzbekistan.

In Russia, four projects were closed in 2002. Two of these dealt with issues crucial
for the development of private farming in the country: restructuring of privatised ex-
collective  farms  in  the  Central  Black  Soil  region  and  the  Lower  Volga  region;
promotion  of  rural  credit  cooperatives  in  three  selected  regions  of  Russia.  Two
additional  ongoing  projects  supported  the  creation  of  extension  services  in  South
Russia  and  the  enhancement  of  competitiveness  by  food  producers  in  Siberia
respectively.

However,  development  of  the  Agriculture  and  Rural  Development  sectors  in  NIS
countries  still 
inherent  obstacles,  such  as  difficult  climate
(e.g., insufficient  rainfall),  carry-over  of  unfavourable  policies  from  Soviet  times
(e.g.  state  crops),  problems  with  establishing  ownership  rights  to  land,  lack  of
irrigation and inadequate mechanisation. There are also difficulties with the general

faces  many 

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lack of profitability of the sector and access to finance owing to the perceived risk of
the sector.

– 

Health

Alcohol consumption, drug  addiction  and  the  suicide  rate  are  high  in  the  NIS.  The
population of Russia is declining by one million each year. The life expectancy for
males is now less than 58 years. Diseases that could be prevented by immunisation
are  reappearing.  The  AIDS  epidemic  might  turn  into  a  national  security  threat.
Environmental  risk  factors  and  socio-economic  trends  have  drastically  increased
mortality from heart disease, violence and injuries.

The NIS are in an emerging crisis of grave proportions with poverty, unemployment
and crime increasing, while the quality of social services is decreasing. Governments
lack systems  for  disease  surveillance, funds  to  purchase  retroviral  medicines  or  the
facilities to care for the diseased. The programmes for health are poorly structured or
non-existent, and the health budget is very low.

The majority of the population finds it difficult or impossible to obtain health care,
with  access  to  health-care  being  determined  by  social  or  political  status.  Small
countries are not technically self sufficient to face epidemics.

In  2002,  Tacis  had  around  10  ongoing  projects  in  the  health  sector  with  payments
totalling about €7 million. In addition, three small-scale projects were completed (for
about €1 million).

Tacis  has  provided  support  on  a  range  of  issues  in  Russia,  notably  a  public  health
project in the north-west concerned with specific aspects such as primary healthcare,
preventive  medicine,  medical  education,  prevention  of  mother-to-child  HIV
transmission,  and  cardiovascular  diseases.  Additional  smaller-scale  measures  have
provided assistance on preventive healthcare policies and programming, support for
victims  of  gender  violence  and  a  project  on  palliative  care.  The  fight  against  drug
abuse is a  growing  concern, which Tacis has helped to tackle through  a number  of
measures – by seeking to reduce illegal drug consumption, by fighting narcotics use
in the region of Karelia and through peer education of narcotics users to reduce harm
caused by addiction.

Health has also been an important area of Tacis in Ukraine. Key focal areas include a
major  initiative  set  up  on  HIV/AIDS  prevention,  support  for  the  organisation  of  a
national pharmaceutical administration and a small-scale project on health and social
care  for  the  elderly.  The  HIV/AIDS  prevention  initiative  benefits  from  an  active
support  of  local  and  regional  administrations  and  non-governmental  organisations
the  national  pharmaceutical
the  organisation  of 
(NGOs).  The  project  on 
administration  enabled  the  Ukrainian  pharmaceutical  industry  to  produce  drugs  of
international ‘Good Manufacturing Practice’ standards. As a result, high quality and
affordable medicine will be available to the Ukrainian population and pharmaceutical
exports possible. Likewise, in both Moldova and Uzbekistan health support has been
identified as one of the priorities.

For the remainder of the NIS, health has not been high on the priority list for support
in negotiations with the partner governments, despite the undoubted problems in the
health sector in all these countries. Tacis has undertaken some successful, small-scale

140

targeted initiatives, for example hospital management in Belarus, primary healthcare
for IDPs in Azerbaijan and combating tuberculosis in Kyrgyzstan.

– 

Education

When  the  Soviet  Union  collapsed  in  1991  levels  of  literacy  and  school  attendance
were equivalent to those within the EU. Since the early 1990s, a clear negative trend
has been observed in  education  indicators.  This  is  alarming,  particularly  bearing  in
mind the Millennium Goals on education which aim at enrolment of all children in
primary education by 2015.

Furthermore,  vocational  education  and  training  (VET)  and  higher  education  in  the
NIS countries are challenged to meet the new needs of enterprises on the emerging
market economies. A functional VET system is also a prerequisite in the fight against
growing  unemployment.  Consequently,  in  2002,  the  Tacis  programme  focused  on
supporting vocational education and training and higher education.

Support  to  higher  education  has  been  channelled  through  the  Tempus  Programme.
Tempus supports the reform and restructuring of the higher education system and its
adaptation to the new socio-economic needs. The priority  areas for Tempus, jointly
defined by the European Commission and the national authorities, are the following:
curriculum  development,  reform  of  management  of  higher  education  institutions,
improving  skills-related 
industry  and  strengthening  of
democracy.

training  required  by 

In the area of vocational education and training, the European Union is continuing to
support  the  NIS  countries  in  upgrading  and  modernising  their  VET  reform
programmes.  During  2002,  the  European  Training  Foundation  (ETF)  finalised  the
second  phase  of  the  pilot  project  on  vocational  and  training  reform  in  north-west
Russia in cooperation with the International Labour Organisation (ILO) and the EU
Member  States.  This  project  has  developed  an  innovation  model  for  regional  VET
reform both at school and at administrative levels.

The Tempus programme proved to be a successful tool in the higher education sector
and since 2002 the Commission is working on a reform to simplify and speed up the
procedures to allow a more flexible, efficient and quick use of existing Tacis funds
for education. This reform process is also a key priority for the programme in 2003.
The total amount for ongoing education projects in 2002 was €35 million.

The Management Training Programme continues to make a real impact on  Russian
businesses.  In  2002  as  many  as  700  junior  and  middle  managers  were  offered
placements by EU companies.

Obstacles  of  language  and  culture  still  exist  but  the  programme  and  partners  are
making a point of learning from the experience of the last few years and building on
the much that has been positive.

–  Macroeconomic Policies

On the basis of Council decisions, the European Union has in recent years provided
macrofinancial assistance (MFA) to Belarus, Ukraine and Moldova, and to Armenia,
Georgia and Tajikistan. Macrofinancial assistance, in the form of loans or grants, is
conditional  on  the  implementation  by  the  countries  concerned  of  economic

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programmes  supported  by  the  IFIs and  of  specific  structural  reforms  of  interest  for
the EU. Amongst such structural reforms are the improvement in the functioning of
public finances,  restructuring  and privatisation of large  state enterprises, reforms in
the  energy  and  telecommunications  sectors,  reform  of  the  banking  system,  etc.  In
2002,  under  macrofinancial  assistance  programmes,  the  Commission  provided  to
Armenia a grant of €11 million. Also, two new Council Decisions replacing existing
programmes  were  adopted:  a  €110  million  loan  to  Ukraine  (replacing  a  loan  of  a
smaller  amount  provided  under  less  favourable  financial  conditions)  and  a
€15 million  grant  to  Moldova  (replacing  a  loan  of  an  equivalent  amount).  The
implementation of these two operations had not started in 2002.

In 2002, Tacis provided additional support to the macroeconomic development of the
NIS region with a dozen projects, now completed, and another ten in progress. These
projects  included  the  economic  trends  initiative,  state  budget  reform  in  Russia  and
tax projects  in  Russia  and  Kazakhstan  .  Much  emphasis  was  placed  on  influencing
policy at high level with regard to assisting partner countries on economic modelling
and fiscal and taxation policy.

– 

Environment

The  disbursement  trend  continued  to  improve,  with  95%  of  the  forecast  achieved.
Projects continued to cover  a wide range of areas, with policy reform, biodiversity,
and  water  management  leading  the  field.  Policy  projects  that  attempt  to  cover  the
whole  region  have  shown  a  weak  commitment  from  beneficiaries.  The  lesson  is  to
focus on a more homogeneous grouping of countries, and follow-on policy projects
will do so.

Following the changes in the Tacis Regulation of 2000, environment is now moving
into  investment  support,  both  in  cofinancing  and  in  preparation.  The  Joint
Environment Programme, which promotes environment investment, was ‘topped up’
during 2002, to €6 million, and was closed off in December 2002. At the same time,
a  new  phase  was  launched,  also  for  €6  million.  This  project  has  catalysed  about
€85 million  of  lending  for  environmental  projects  in  the  NIS  region.  One
disappointment was that a grant cofinancing project in the Ukraine to reduce Black
Sea pollution fell through when the  IFI  loan  concerned  was  rejected.  However,  we
were  able  to  substitute  sufficiently  mature  investments  in  the  Black  Sea  (Crimea)
with similar impact on nutrient pollution.

to  affect
Increasing  divergence  of  political  aims  and 
implementation  of  international  conventions  and  thus  the  impact  of  transnational
environmental  projects.  Progress  on  the  creation  of  an  International  Peace  Park  in
Central  Asia  is  currently  stalled.  However,  good  results  emerged  from  finding
alternative  rural  industries  in  national  parks.  River  basin  management  projects
continue to have a high buy-in and impact, and this regional cooperation aspect will
continue to be the focus of the new programmes.

interests  continue 

On  9  July  2002  the  first  pledging  conference  for  the  Northern  Dimension
Environmental  Programme  (NDEP)  Support  Fund  took  place  in  Brussels.  The
Russian  Federation,  the  European  Commission  and  five  other  countries  announced
their intention to contribute a total amount of €110 million to the Support Fund. The
Commission  pledged  a  contribution  to  the  NDEP  Support  Fund  of  €50  million,  or

142

45% of the pledged amount to  date. Of the Commission’s  contribution €40  million
have been earmarked for nuclear projects.

The NDEP is a new initiative, launched in 1999. It is a partnership of the European
Commission,  Russia,  the  EBRD,  the  European  Investment  Bank  (EIB),  the  Nordic
Investment  Bank  (NIB)  and  the  World  Bank,  strongly  supported  by  EU  Member
States plus Norway. Other potential contributors are considering joining the effort. It
aims  to  bring  together  the  EU’s  external  policies  and  instruments  operating  for  the
benefit  of  the  countries  around  the  Baltic  Sea  to  improve  environment  and  the
management of spent nuclear fuel and radioactive waste, with a focus on north-west
Russia.

– 

Nuclear Safety

A major event in the nuclear safety programme was the International Conference for
the 10th anniversary of Tacis activities, held in Kyiv from 10 to 12 July 2002. The
implementation over the period 1991 – 2000 of about 600 projects for in excess of
€640 million, was praised by all the beneficiary countries.

A particular emphasis has been put on increasing operational safety through ‘on-site
assistance’, which is provided on a continuous basis by EU  operators at  14  sites in
the NIS. On-site assistance aims to improve the level of design safety, operating and
surveillance  conditions  and  the  organisation  of  operational  safety.  Independent
regulatory  authorities  are  being  strengthened  through  EU  technical  and  financial
assistance  and  much  of  the  necessary  legal  framework  has  now  been  put  in  place.
The  overall  safety  culture  is  being  improved  through  more  formal  and  regular
dialogue  between  plant  operators  and  regulatory  authorities.  nuclear  power  plants
(NPPs)  are  being  modernised  with  the  provision  of  equipment  (e.g.  installation  of
fire detection system in Beloyarsk NPP, supply of Tritium measurement equipment
to Kola NPP, etc.).

The  support  to  the  nuclear  regulators  and  their  technical  support  organisations
encompasses  everything  related  to  strengthening  the  role  of  beneficiary  national
authorities. The negotiations concerning the licensing of three Russian nuclear power
plants upgrading projects were successfully concluded in 2002. In Belarus, Armenia
and Kazakhstan, projects have been designed to renew the institutional support to the
nuclear regulators.

In  Chernobyl,  Tacis  has  continued  its  assistance  towards  the  decommissioning  of
units 1, 2 and 3. Tacis is funding the construction of an industrial complex for solid
radwaste  (ICSRM)  arising  from  the  decommissioning.  The  Community  is  also  the
biggest  donor  to  the  Chernobyl  Shelter  Fund  project,  managed  by  EBRD,  and
designed to convert the damaged unit 4 into an environmentally safe site.

– Non-proliferation of expertise in the NIS

The fall of the  Soviet Union created  an unprecedented  threat  to  the  world  security,
through  potential  brain  drain  of  weapon  of  mass  destruction  (WMD)  scientists  and
transfer  of  weapon  technologies  towards  “rogue”  states,  terrorist  or  criminal
organisations determined to acquire this expertise.

143

The response of the international community has been managed in a pragmatic way,
establishing  two  Science  and  Technology  Centres  -ISTC  in  Moscow  and  STCU  in
Ukraine - and seizing this opportunity to engage WMD scientists into research  and
development for peaceful purposes. A decade after the establishment of the Science
Centres, the risk of proliferation of WMD remains high on the international agenda.

The  International  Science  and  Technology  Centre  (ISTC)112  and  the  Science  and
Technology  Centre  of  the  Ukraine  (STCU)113  are  inter-governmental  sister
organisations  that  are  partly  funded  by  the  European  Commission.  The  ISTC
agreement  was  signed  on  27  November  1992  by  the  United  States,  Japan,  the
European  Commission and the  Russian  Federation.  The  STCU  agreement  was  first
signed  in  1994  between  the  Ukraine,  Canada,  Sweden,  and  the  United  States;  the
European Commission joined in November 1998.

The main purpose of both centres is to give Russian and NIS scientists and engineers
that possess knowledge  and  skills related to  weapon  of  mass  destruction  or  missile
delivery  systems,  opportunities  to  redirect  their  talents  to  peaceful  activities.  The
Centres  are  and  remain  WMD  non-proliferation  programmes,  allowed  by
governmental decrees to operate within the limit of military territories where R&D is
being  conducted.  The  Centres’  mission  is  therefore  to  organise  the  redirection  of
WMD  scientists’  activities,  through  supporting  innovative  projects  in  science  and
technology.  In  so  doing,  these  programmes  are  expected  to  induce  business
opportunities for both NIS and EU companies through launching of new commercial
joint ventures.

The total budget between 1994 and March 2003 from all Parties to the ISTC (STCU
figures in brackets) was approximately €441 million (€64 million), which supported
about 1 628 projects (455 projects) and 51 000 scientists (11 000 scientists). The EC
contribution, through the Tacis Programme, for this period was €77 million to ISTC
and €12 million to STCU. In 2002, 301 new ISTC and 96 new STCU projects were
funded  for  respectively  €78.6  million  and  €15.5  million.  ISTC  supported  26  500
participants,  for  a  total  of  grant  payment  reaching  €42.5  million,  while  STCU
supported  4 200  participants.  Projects  have  been  conducted  in  the  areas  of
biotechnology,  environment,  information  technologies,  nuclear  safety,  chemistry,
space technology and energy.

Despite  its  successes  and  the  passage  of  a  decade,  the  NIS  states  supported  by  the
ISTC and STCU have  not  yet  been  able  to  reach  a  position  where  they  are  able  to
support their former WMD scientists without outside assistance. The Parties to both
Centres  recognised  therefore  that,  to  accomplish  their  non-proliferation  objective
might require supporting the Centres until the end of this decade.

However,  the  Agreement  recognises  “that  the  success  of  the  Centre  will  require
strong  support from governments, foundations, academic  and  scientific  institutions,
and  other  inter-governmental  and  non-governmental  organisations”.  In  that  regard,
the  partners’  program  instituted  by  the  ISTC  in  1998  contributes  to  enhancing  the
ISTC’s ability to reach its non-proliferation objective. It further  establishes the root

112

113

The  member  countries  of  the  ISTC  are:  the  Russian  Federation,  Kazakhstan,  Kyrgyzstan,  Belarus,
Armenia, Georgia and Tajikistan.
The  member  countries  of  STCU  are:  Ukraine,  Georgia,  Uzbekistan  and  Azerbaijan.  Discussions  are
ongoing with Moldova to accede to either the STCU or the ISTC Agreement.

144

                                                
of  an  exit  strategy  for  the  parties  so  that  the  Centres  can  continue  operating  at  the
present level once Parties designated Centres funds begin to disappear.

In  addition,  the  overall  international  environment  provides  a  new  impetus  to  build
upon  the successes of  ISTC,  undertaking  further  activities  in  support  of  the  Global
Partnership towards non-proliferation and Disarmament, launched at the G8 Summit
held  in  Kananaskis  in  2002.  Indeed  ISTC  and  weapon  laboratories  benefiting  from
ISTC  activities,  have  already  conducted  preliminary  S&T  projects  to  qualify
technologies  necessary  to  future  large  undertakings  of  the  Global  Partnership,
favouring  therefore  involvement  of  Russian  engineers  in  conducting  “Disarmament
projects”.

– 

Partnership Civil Society and NGOs

The European Union is committed to the continued support of civil society, and 2002
has seen the consolidation of this commitment with a widening of support throughout
the Tacis region. Geographically, support has increased in regions that have been less
supported  in  the  past.  Up  to  2002,  269  civil  society  projects  involving  600
organisations in the  Tacis  region  received support from the European  Commission.
In  2002  alone,  74  projects  were  selected  for  funding,  involving  approximately  300
organisations,  through  the  civil  society  component  of  the  newly-formed  Institution
Building  Partnership  Programme  (IBPP).  In  total,  90  civil  society  projects  have
received  €15  million  worth  of  funding  while  56  projects  totalling  €7  million  have
reached their conclusion throughout the year.

Difficulties  have  arisen  in  countries  with  more  authoritarian  governments.  Such
governments are  suspicious  of civil society and  it  is difficult  to  secure.  Belarus  for
example introduced a taxation law related to international Donor  activities in 2002.
The  result  has  effectively  been  the  suspension  of  implementation  of  civil  society
projects  in  that  country.  Twelve  selected  IBPP  Support  to  Civil  Society  projects
amounting  to  €2  million  have  yet  to  receive  contracts  due  to  this  unresolved
situation.  The  Belarus  Civil  Society  Development  programme  has  also  been
adversely  affected  with  no  new  contracts  in  2002.  A  more  concerted  effort  is
required  to  ensure  that  civil  society  receives  adequate  levels  of  support  in  such
countries.

The new programme builds on the previous Tacis Lien (NGO partnerships) and Tacis
City Twinning Programme (local/ regional authorities’ partnerships) and is designed
to  support  an  institution  building  process  through  partnership  and  cooperation
between non-governmental organisations (NGOs), local/regional authorities and non-
profit  professional  organisations.  The  focus  of  support  has  been  to  encourage  the
development  of  initiatives  at  a  local  level,  strengthen  the  diversity  of  civil  society
throughout  the  region  and  ensure  contacts  through  international  networks  for  an
exchange  of  information,  ideas  and  skills.  This  programme  which  aimed  at
economic, social and cultural rights is a vital and unique tool in the Tacis region. The
the
EU  visibility 
consequences of transition and fighting marginalisation and poverty.

the  region’s  populations 

is  high  amongst 

in  addressing 

145

A first call for proposals, with a budget of €15 million was published in December
2001  with  a  submission  deadline  in  April  2002.  From  267  proposals,  74  projects
were selected for funding. Most of these projects will start at the beginning of 2003
and  will  run  between  18  and  24  months.  €9  777  778  of  the  €15  million  were
dispersed in 2002. The rest will be dispersed in 2003.

A  second  Call  for  Proposals  with  a  budget  of  €11.7  million  was  launched  in
December  2002  with  a  submission  deadline  in  April  2003.  Approximately  300
applications are expected.

6.2.4

The three Cs (Coherence, Coordination and Complementary in the Region)

6.2.4.1 Cooperation with Member States and other Donors in the Region

The  Delegations  of  the  European  Commission  maintain  a  regular  dialogue  with
Member States embassies, IFIs and other major donors. Thus, in Russia for instance,
during  the  past  year,  the  EC  presence has  been  assured  at  all  donors  coordination
meetings, in particular in the areas of administrative reform, judicial reform or health
care where the Delegation can assume a leading role.

The  National  Coordinating  Units  carry  out  regular  meetings  with  other  donors  and
IFIs, assuring synergies and effective exchange of information.

Member States embassies are invited to take part in major events related to projects,
especially if they are organised with the support of the Delegation.

Concrete  examples  of  donor  coordination  are,  for  instance,  the  donor  inter-agency
meetings in health care organised by the World Health Organisation and held at the
Delegation  every  month.  The  Delegation  is  also  a  member  of  the  working  groups
under the auspices of ILO and UN, which are organised to discuss issues related to
social policy, such as pension reform, labour markets and poverty reduction.

Last  year,  the  preparatory  works  for  the  Sludge  Incineration  Plant  linked  to  the
Southwest  Wastewater  Treatment  Plant  in  St.  Petersburg,  a  complex  investment
project,  served  as  a  platform  for  permanent  contacts  with  other  donors  such  as
Denmark, Finland and Sweden or international financial institutions such as EBRD,
EIB and NIB.

6.2.4.2 Humanitarian Aid in the Region

ECHO  completed  its  withdrawal  from  Ukraine,  Moldova  and  Belarus  as  part  of  a
progressive shift to other more appropriate aid instruments. In Central Asia, ECHO
continued  its  support  (€10  million)  for  Tajikistan,  directing  it  more  towards
vulnerable  groups  now  hit  by  the  combined  effects  of  drought,  civil  war  and  the
socio-economic  crisis.  In  the  southern  Caucasus,  despite  a  scaling-back  of  aid  the
previous year, ECHO had to come to the aid of those once more affected by drought
(€700 000  in  Georgia  and  €500 000  in  Armenia),  and  then  resume  its  assistance  to
the most vulnerable people in Georgia, especially around Abkhazia (€1.3 million). In
the northern Caucasus, ECHO continued to provide aid for victims of the conflict in
Chechnya. In the absence of a political settlement of the conflict, no improvement in
the  life  of  the  civilian  population  of  Chechnya  took  place  in  2002.  Despite  the
persistent  difficulties  with  access  and  increasingly  precarious  security  conditions,

146

€28  million  was  therefore  allocated  in  2002  to  help  the  most  vulnerable  displaced
persons in Chechnya, Ingushetia and Daghestan.

European Community Humanitarian Office’s (ECHO)
Financing Decisions 2002

Country

€ million

Northern Caucasus (Chechnya)

Armenia, Georgia

Tajikistan

Total

6.2.4.3 EIB activities

28

2.5

10

40.5

The European Investment Bank mainly concentrates its actions within the EU and in
specific  projects  in  selected  regions.  In  2002,  the  EIB  joined  the  Commission  (and
other  International  Finance  Institutions)  in  the  Northern  Dimension  Environmental
Partnership. This initiative pools contributions and ensures international cooperation
for priority environmental projects of up to €100 million in total.

6.2.5

Results-oriented Monitoring

During 2002, the Tacis monitoring team monitored 366  projects  (calculating  multi-
component  Regional  Programmes  as  a  single  project  or  447  if  multi-component
Regional Programmes are counted separately), producing 600 reports for the TACIS
region.  In  parallel  with  the  ongoing  usual  work  of  project  monitoring,  the
methodological challenge to harmonise the Tacis monitoring system with the Result
Oriented  Monitoring  (ROM)  was  achieved:  since  1  December  2002,  the  ROM  is
being applied to the monitoring of all projects scheduled to close after 30 June 2003.
Of  the  600  reports,  578  were  drafted  utilising  the  previous  “activities-oriented”
TACIS templates and 22 reports using the ROM system.

The  sample  of  ROM  reports  in  the  Tacis  region  is  statistically  small  (22  for
17 projects) and therefore it is only possible to draw some general conclusions at this
stage  regarding  project  performance  in  one  of  the  priority  areas,  Institutional
Capacity and Good Governance (13 reports). The average score for all other reports
together is 2.7, while for Institutional Capacity and Good Governance it is 2.2, well
below the median point of 2.5. Although the projects are initially well-designed and
enjoy the policy support of the beneficiaries, there are concerns about the efficiency,
effectiveness,  potential  impact  and  sustainability  of  these  projects.  The  monitoring
reports  highlight  three  primary  causes:  limited  understanding  on  the  part  of
contractors  as  to  what  is  involved  in  building  institutional  capacity;  a  tendency  to
establish new institutions rather than reform and enhance the institutional capacity of
existing  structures;  and  a  failure  to  ensure  that  the  necessary  human  resources  and
budgetary support are available prior to the commencement of a project.

147

Tacis “input-activity” monitoring

In 2002, 349 Tacis projects to a value of over €730 million were monitored utilising
an “input-activity” approach, covering the assistance provided through the National,
Small  Project,  Horizontal/Regional  and  the  strategically  important  Nuclear  Safety
Programmes.  There  has  been  a  gradual,  but  discernible,  improvement  in  project
performance throughout the project lifetime. The previous Tacis monitoring system
has been in operation since 1993, over which time empirical evidence suggests that
the  monitoring  activity,  combined  with  responsive  project  management,  has  a
positive effect upon project performance. In particular, significant improvement can
be seen in contractor’s performance and in the greater commitment and satisfaction
of project partners.

Monitoring  of 
the  Tacis  National  programmes  (162  projects,  value  over
€330 million) is grouped under the six areas of cooperation. Projects in support  for
institutional,  legal  and  administrative  reform  (64  projects,  value  €132  million),
private  sector  and  economic  development  (52  projects,  value  €123  million)  and
addressing the social consequences of transition (14 projects, value €28 million) are
well-designed, relevant and implemented efficiently and they are well supported by
the project partners. If there is one reservation, it is whether the results are financially
and institutionally sustainable.

Although  the  projects  in  support  of  the  Development  of  infrastructure  networks,
(12 projects, value €20 million), Promotion of environmental protection (12 projects,
value  €22  million)  and  Development  of  the  rural  economy  (8  projects,  value
€10 million) could have better developed initial design, they nevertheless all progress
to reach or surpass the median point by project end. The sector, which has shown the
most  progress  is  Development  of  the  rural  economy,  where  the  average  rises  from
1.8 during the first mission to 3.6 at project end.

The  Small  Projects  Programme  (SPP  -  57  projects,  value  €16  million)  consistently
outperforms the overall Tacis average. They score particularly well on relevancy and
commitment and contribution of the project partners. However, they score less well
on  work  planning,  sustainability  and  achievement  of  objectives,  perhaps  reflecting
the fact that for those implementing small projects, the implementation of the activity
is itself the primary goal.

The  Nuclear  Safety  projects  (83  projects,  value  €238  million)  are  mostly
implemented  in  a  particularly  difficult  environment.  They  generally  tend  to  begin
weakly  as  a  result  of  poor  project  design  and  frictions  between  contractors  and
beneficiaries  during  project  start-up.  However,  the  average  score  rises  sharply
throughout  the  lifetime  of  the  project.  The  improvement  is  particularly  noticeable
with respect to project relevancy, project partners’ commitment and involvement and
contractors’  performance.  Nevertheless,  the  scores  for  delivery  of  results  and
achievement of project purpose remain comparatively low. The main problem is that
these  projects  frequently  involve  the  purchase  of  safety  equipment  and  the
procurement  process  causes 
implementation  and
consequently the delivery of results.

lengthy  delays 

to  project 

148

The  Regional/Horizontal  Programmes  projects  (47  projects,  value  €146  million)
improve significantly over time. The main areas of improvement are with respect to
contractor’s  performance  and  project  partners’  commitment  and  involvement.
Nevertheless,  these  projects  consistently  under-perform  on  all  indicators  when
measured  against  the  average,  most  notably  with  respect  to  project  design,
sustainability and achievement of project purpose.

Example  of  a  project  where  monitoring  had  an  immediate  impact  upon  project
performance:

UZBEKISTAN

“Support for the implementation of the EU-Uzbekistan Partnership and cooperation
Agreement”

During the first monitoring mission for this strategically important project, the monitors drew
attention  to  the  fact  that  the  Contractor’s  performance  was  poor:  there  was  limited
backstopping  and  logistical  support,  the  project  planning  was  ill-defined  and  the  inception
phase inconclusive. The project performance was rated at 2.75, well below the median point of
3.0.  The  Project  Manager  reacted  immediately  and  a  meeting  was  organised  with  the
Contractor  in  Brussels.  The  Contractor  subsequently  agreed  to  implement  the  monitors’
recommendations.  The  follow-up  monitoring  mission  concluded  that  the  project  was  back  on
track and likely to achieve all the planned results. The project is now rated at 3.8, well above the
median

6.2.6

Conclusions and Perspectives in the years to come

In  2002,  work  has  begun  to  assess  the  potential  impact  of  enlargement  on  EU
relations  with  Eastern  Europe  and  Central  Asia.  In  the  future,  the  EU  will  develop
further  the  implications  of  the  “Wider  Europe”  concept,  which  aims  at  enhancing
stability  and  narrowing  the  prosperity  gap  on  the  new  external  borders  of  the  EU.
This  will  lead  to  increased  support  for  activities  that  promote  cross-border
cooperation, particularly with respect to Russia, Ukraine, Moldova and Belarus.

In  the  Caucasus  and  Central  Asia,  the  EU  will  continue  to  prioritise  regional
cooperation,  notably  through  measures  aimed  at  poverty  reduction  and  economic
growth, and, where appropriate, conflict prevention.

In terms of implementation, the emphasis will be on consolidating the management
of  EC  assistance  in  the  field  in  the  light  of  the  successful  devolution  of
responsibilities to the four NIS Delegations in 2002. This will require further work in
terms of ensuring that the Delegations have the support they need to carry their new
responsibilities.

6.3

MEDITERRANEAN, NEAR AND MIDDLE EAST

The Euro-Mediterranean partnership was launched eight years ago as a sign of a joint
commitment to promote peace, prosperity and mutual understanding in a region too
often characterised by conflict, poverty and division. Today, it is worth reaffirming
the strategic importance of that partnership, established in Barcelona in 1995 by the
fifteen Member States of the European Union and the twelve Mediterranean partners.
As a model for cooperation, it extends far beyond the economic sphere and aims to
promote lasting regional stability as an indispensable pre-condition for any attempt to
region.  The  Euro-Mediterranean
bring  shared  prosperity 
partnership  is  the  only  regional  forum  for  discussion  and  stands  for  a  unique

to  Mediterranean 

149

comprehensive  and  evolutionary  approach  to  development,  a  vehicle  for  the
implementation of common policies and strategies in the region.

6.3.1

Strategic Goals and Achievements

6.3.1.1 Barcelona Process:

In  2002, 
the  Barcelona  process  was 
Euro-Mediterranean Conference of Foreign Ministers in Valencia on 22-23 April.

important  meeting  of 

the  most 

the

The conference agreed on reinforcing the Barcelona Process with a renewed mutual
commitment to contribute to peace and stability in the region.

The Valencia Action Plan adopted unanimously at this Conference, includes:

– 

– 

In the political and security chapter, the reinforcement of the political dialogue,
and the creation of a Euro-Med Parliamentary Assembly;

In the economic and financial area, to complete the grid of Euro-Mediterranean
Association  Agreements,  to  promote  regional  trade  and  integration  (notably
through  the  adoption  by  general  consensus  of  an  Action  Plan  focusing  on
developing  the  South-South  dimension,  the  “Agadir  initiative”),  to  ensure
sustainable development and a high degree of environmental protection and to
create  a  reinforced  Facility  within  the  European  Investment  Bank  (EIB)  to
mobilise  further  funds  for  the  region.  The  development  of  regional  transport
and  energy  infrastructure,  in  particular  interconnections  (development  of
Transport  and  Energy  Trans-Euro-Mediterranean  Networks)  and 
the
importance of and priority attached to regional energy interconnection projects
of  common  interest  was  also  confirmed  at  the  Euro-Mediterranean  Energy
Ministerial Conference held in Athens on 21 May 2003;

– 

In  the  social,  human  and  cultural  dimension,  the  launching  of  a  regional
programme  on  Justice  and  Home  Affairs,  and  the  creation  of  a  Euro-Med
Foundation to promote further dialogue of cultures and civilisations.

Euro-Mediterranean Ministerial meetings were held on Trade, Industrial cooperation
and Environment. Overall, the political profile of the Euro-Med partnership has been
enhanced despite the negative background of the Middle East crisis.

6.3.1.2 Association Agreements:

At  present,  the  Euro-Mediterranean  Association  Agreements  concluded  with
11 partner  countries  (to  be  finalised  with  Syria)  constitute  the  main  framework  for
bilateral  cooperation  with  the  EU.  These  Agreements  also  reinforce  links  between
the  partner  countries  at  regional  level,  together  with  the  initiatives  being
implemented  by  the  Mediterranean  partners  themselves,  particularly  the  Agadir
process, on which major progress was made during 2002.

In  2002  the  Commission  launched  an  initiative  to  establish  a  harmonised
implementation  system  for  the  Association  Agreements.  By  the  end  of  the  year  a
proposal had been submitted to the Council with a view to creating six new working
groups.

150

The table below shows the situation of the Association Agreements:

Country Strategies

State of play

Association Agreement

CSP/NIP

Algeria

AA signed 22 April 22 2002

Memorandum NIP signed
18 June 2002. Indicative budget:
€150 million

Jordan

AA entry into force 1 May 1 2002.
First AA Council held on 10 June
10 2002

Memorandum NIP signed in
February 2002. Indicative
budget: €142 million

Lebanon

AA signed 17 June 17 2002

Morocco

Association Committee 13 March
2002

Egypt

AA signed 25 June 2001

Memorandum NIP signed
4 March 2002. Indicative
budget: €80 million

Memorandum NIP signed
24 January 2002. Indicative
budget: €426 million

Memorandum NIP signed
February. Indicative budget:
€351 million

Memorandum NIP signed 4
April 2002. Indicative budget:
€93 million

Syria

Tunisia

Israel

AA negotiations 9th round took
place in November 2002

Association Council 29 January
2002. Association Committee 25
September 2002

Memorandum NIP signed
8 March 2002. Indicative
budget: €248,65 million

Association Committee 8 October
2002. Association Council
21 October 2002

March 2002: Request for
participation in the 6th RTD
Framework Programme

Five  economic  dialogues  took  place  in  the  course  of  the  year  in  the
framework  of  implementation  of  the  Association  Agreements  with  the
following  countries:  Lebanon  (Beirut,  11/6/02),  Tunisia  (Tunis,  4/7/02),
Morocco (Rabat, 16/9/02), Israel (Brussels, 17/10/02) and  Jordan (Brussels,
8/11/02).

6.3.1.3 Middle East Peace Process:

Although  continuing  violence  and  deteriorating  conditions  on  the  ground
made  it  unrealistic  to  talk  of  a  peace  process  in  2002,  the  Commission
increasingly  focused  its  efforts  on  working  within  the  international  Quartet
(EU,  US,  Russia  and  UN)  through  the  EU  delegation  to  the  Quartet  at
ministerial level. In support of this, the Commission participated in the Task
Force  on  Palestinian  Reform  and  worked  closely  with  the  EU  Special
Representative  for  the  Middle  East.  The  Commission  coordinated  several
aspects of the Task Force’s work on the spot, in particular issues relating to
the rule  of law, preparations for  elections and public finance  reform.  These

151

activities  were  supported  by  the  programme  for  West  Bank  and  Gaza
reported  on  below.  Through  its  Partnership  for  Peace  programme,  the
Commission continued to support groups working for a peaceful solution to
the conflict. The Commission continued to take part in several events related
to the multilateral dimension of the peace process.

6.3.1.4 Other countries

Directives  were  obtained  from  the  Council  (July  2002)  for  negotiating  a
Trade and cooperation Agreement with Iran; negotiations were launched on
12 December.

Negotiations for a Free Trade Agreement with the Gulf Cooperation Council
have  continued,  with  rounds  being  held  at  a  pace  of  one  every  six  to  eight
weeks.

Cooperation  with  Yemen  has  been  given  more  visibility  notably  on  the
occasion of the World Bank Donors Conference held in Paris (autumn 2002).
A Joint cooperation Committee took place in Brussels on the 20 of June; the
meeting  was  mainly  focused  on  the  implementation  of  the  cooperation
programme.

At last, the developments in Iraq and in the Security Council regarding Iraq
have  been  followed  very  closely,  resulting  in  a  constant  fine-tuning  of  the
line to be followed by the Commission on this matter.

6.3.2

Programming priorities

The  MEDA  programme  provides  financial  aid  to  achieve  the  objectives  of
the Association Agreements and the  Barcelona  process.  Among  the  priority
areas of Community development policy, the MEDA programme focuses on
the following key objectives::

– 

– 

– 

– 

development of  a pluralist,  democratic society based  on  human  rights
and the rule of law;

implementation of the Association Agreements with the aim of creating
a Euro-Mediterranean free trade area;

economic  and  social  reform  arising  from  implementation  of  the
Association Agreements;

subregional  cooperation, 
the  fostering  of  South-South
development  and  economic  integration  initiatives  that  will  help  the
partners move towards free trade amongst each other.

through 

The situation of the National Indicative Programmes (NIPs) is shown in the
table above (6.3.1.2).

152

6.3.3 Main Results in 2002

The  total  amount  committed  by  the  Commission  for  Mediterranean  non-
member countries across all budget lines (excluding funds for Turkey under
the  enlargement  heading)  was  €762.4  million,  while  payments  stood  at
€684.3 million for the same period.

As  the  Euro-Mediterranean  partnership’s  main  instrument  for  financial
cooperation,  the  MEDA  programme  accounted  for  the  lion’s  share  of
commitments in 2002, €611.6 million. Payments stood at €451.4 million.

MEDA  funding  of  €100  million  went  towards  direct  budgetary  aid  for  the
Palestinian  Authority.  This  aid  ensured  the  provision  of  skeleton  services
following the freeze of Israel’s VAT revenue transfers. Transfers eventually
resumed  in  December.  Support  for  the  peace  process  led  to  a  substantial
increase  in  commitments  in  2002,  at  €87.8  million  they  almost  doubled
compared  with  the  previous  years.  Aid  of  €55 million  for  Palestinian
refugees  was  provided  under  the  11th  Convention  between  the  EU  and
United Nations Relief and Works Agency for Palestine Refugees (UNRWA).

There  was  also  more  specific  Community  aid  for  the  Palestinians  under
targeted  horizontal  budget  lines.:  €8.3  millions  to  finance  food  security
projects;  €2.5  million  for  the  electoral observation mission of the European
Union  in  the  West  Bank  and  in  Gaza  under  the  European  Initiative  for
Democracy and Human rights; €1.6 million for decentralised cooperation in
partnership with European NGOs and €35 million for the civilian population
through ECHO.

Compared  with  2001  overall  commitments,  all  budget  headings  combined,
increased  by  8%,  rising  from  €703.7  million  to  €762.4  million  in  2002.
Payments  rose  substantially  in  the  reference  year,  from  €478.8  million  in
2001 to €684.3 million in 2002, i.e. a rise of 43% over two years.

Euro-Mediterranean partnership (excluding Turkey)
commitments/payments in 2002 (€ million)

Programmes

Commitments

Payments

MEDA (B7-410)

Algeria

The West Bank/Gaza Strip

Egypt

Jordan

Lebanon

Morocco

Syria

Tunisia

MEDA bilateral total

Regional MEDA*

2001

60

-

-

20

-

120

8

90

298

305.1

2002

11

80.6

25.7

49.7

5.7

101.9

8.5

89.5

372.6

78.8

2001

5.5

62.2

62.5

10.9

2

41.1

1.9

69

255.1

62.7

2002

50

100

78

92

12

122

36

92.2

582.2

29.4

153

Bilateral/regional total

Palestine (B7-420)

UNRWA (B7-4210)

Yemen (B7-432)

Financial protocols (B7-4050/4051)
Specific  Mediterranean  budget  heading
total** (excluding MEDA):
Grand total

611.7

603.3

451.4

317.8

87.8
55
8
-

150.8

762.5

43.1
57.3
-
-

100.4

703.7

80.7
57.1
0.1
95

232.9

684.3

47.6
54.4
-
58.9

160.9

478.7

Including regional projects and Part A of the budget.
Horizontal budget headings (NGOs, food aid, food security, EIDHR, ECHO, etc.) are

*
**
set out in separate tables in a later section.

Commitments/payments 1995 - 2002 (€ million) 114

1995

1996

1997

1998

1999

2000

2001

2002

Total

Commitments

173

Payments

50

370

155

6.3.3.1 Country Strategies

911

809

797

568.7

603.3

611.6

4843.6

207.8

222.2

240.3

315.3

317.8

451.4

1959.8

MEDA programming made  a considerable  qualitative  leap  forward  in  2002
thanks  to  the  drafting  and  implementation  of  a  new  generation  of  coherent
country  strategy  papers  for  the  period  2002-2006.  The  signing  of  NIPs  for
each  partner  country  -  other  than  the  Palestinian  territories  –  for  the  period
2002-2004  also  contributed.  The  EU’s  strategy  is  now  to  respond  more
specifically  to  national  requirements  emerging  from  implementation  of  the
Association  Agreements.  The  liberalisation  of  foreign  trade  and  the
integration  of  partner  countries  in  a  future  Euro-Mediterranean  free  trade
area are priorities that are now better integrated into the bilateral cooperation
strategies than before.

That is why support programmes for the implementation of the  Association
Agreements were included in the 2002-2004 NIPs. These programmes have
the  specific  objective  of  bringing  in  expertise  and  related  back-up  to  help
local administrations to harmonise the legislative  and regulatory framework
of their domestic markets with those of the EU. The institutional framework
in which this legislation is applied will also be bolstered.

In  the  past  there  was  particular  stress  on  social  and  economic  programmes
under  MEDA.  Support  for  these  sectors  will  continue  but  the  2002-2004
NIPs also introduce a third generation of programmes implementing positive
measures  in  the  fields  of  justice,  internal  affairs  and  good  governance
(justice, media and civil society) in the Maghreb countries.

The  2000–2004  CSPs  for  the  Mashreq  countries  continue  to  focus  on
economic and institutional reform, principally support for implementation of

114

The figures for Turkey are not included.

154

                                                
the  Association  Agreements,  but  also  cover  social  issues,  environmental
protection,  human  rights  and  civil  society,  plus  human 
resources
development. These objectives are translated into practical action under each
country’s  NIP.  However,  given  the  deteriorating  situation  on  the  ground  it
was not possible to establish a CSP and corresponding NIP for Palestine.

6.3.3.2 Implementation

– 

Conflict prevention, good governance and the rule of law

Projects in the Southern Mediterranean and the Middle East were financed to
the  tune  of  €15.4 million  under  the  European  Initiative  for  Democracy  and
Human rights (EIDHR).

The  EIDHR  has  devoted  more  than  €1.6  million  to  promote  and  defend
human rights and fundamental freedoms through the following two projects
with a true regional dimension.

Master’s in Human Rights and Democratisation (€0.7 million): a course for
36 students from Palestine, Lebanon, Malta,  Libya, Egypt, Algeria,  Tunisia,
Morocco,  Turkey,  Cyprus,  Jordan  and  Israel  which  leads  to  a  university
degree  awarded  in  the  Mediterranean  region  by  Malta  University’s
Foundation for International Studies.

Project to promote women’s rights in Egypt, Jordan, Lebanon, the Gaza Strip
and the West Bank (€0.8 million): this project sets out to reduce the violence
to which women and young girls are victim.

The “Support for democratisation” component was granted €1.5 million. An
initial  project  to  strengthen  the  role  of  civil  society  in  political  reform  and
support human rights in the Arab region of the Mediterranean was decided.
Implementation of a second project to improve the ability of civil society in
the  Arab  world  to  stand  up  against  corruption  (Algeria,  Bahrain,  Morocco,
Lebanon, Jordan, Yemen, Egypt, Palestine and Mauritania) was also adopted
in 2002.

The  EIDHR  also  supports  the  forthcoming  elections  in  the  Palestinian
territories of the Gaza Strip and the West Bank. The funds needed for an EU
election observation mission were committed in 2002 and the mission will be
deployed as soon as conditions allow it on the ground.

In connection with conflict prevention special mention should be made of the
Wazzani  Springs  water  resources  assessment  in  Lebanon  study:  a  team
experts  in  water  issues  is  preparing  a  study  on  the  resources  of  the  Litani
basin  as  a  basis  for  international  efforts  to  mediate  in  a  dispute  between
Lebanon and Israel.

In addition, the EU has funded (€5 million) the rehabilitation of Palestinian
Authority  ministries  that  have  a  key  role  in  maintaining  essential  services
and in managing EC-financed programmes.

155

– 

Institution building

One of the main challenges the MEDA countries have to face is to establish
the  bases  of  a  good  governance  and  bring  their  institutions  to  be  closer  to
citizens. Through  institution  building  the  EU  aims  to  provide  the  necessary
support  and  cooperation  with  the  MEDA  countries  to  ensure  public
institutions  deliver  better  services.  The  variety  of  projects  shows  the  wide
range  of  possibilities  in  institution  building.  Weak  institutions  -  confused
laws,  corrupt  courts,  deeply  biased  credit  systems  and  elaborate  business
registration  requirements  -  hurt  poor  people  and  hinder  development.
Learning  from  the  success  and  failures  of  other  countries’  experiences  in
institution building can provide valuable guidance.

On  the  operational  side,  the  EU  is  deeply  committed  to  supporting  the
Palestinian  authorities  in  building  up  a  full  judicial  system,  despite  all  the
internal and external difficulties, as one of the basic pillars to consolidate the
future democratic Palestinian State. The same goes for the Police in Algeria,
where  efforts  are  being  made  in  order  to  modernise  police  services.  Some
difficulties have  been  encountered  in  Tunisia  for  the  implementation  of  the
project on journalists’ training.

In 2002, the Commission funded, started or identified 10 institutional support
projects for a total amount of €182 million.

In  Jordan,  Tunisia,  Lebanon  and  Morocco,  the  year  2002  marked  the
launching of the Support programmes for the implementation of Association
Agreements.  Financial  allocations  were  made  available  to  these  countries
(Jordan: €20 million; Tunisia: €20 million; Lebanon: €12 million; Morocco:
€5 million) in order to enable them to prepare for the entry into force of the
free trade area with EU partners in 2010.

In the West Bank and the Gaza Strip, in order to support urgent activities in
key  sectors  of  EC  assistance,  the  Commission  decided  to  allocate  €5.45
million  for  technical  assistance  and  studies  relating  to  the  identification,
preparation, appraisal, management  and supervision  of  different  projects.  A
project  entitled  ‘Empowering  the  Palestinian  Judicial  System’  (€7  million)
will support the judicial system over 32 months.

In Algeria, a project for police reform approved in 2001 started up in January
2002.  The  six-year  project  receives  an  EU  financial  contribution  of  €2.5
million  and  pursues  the  objective  of  raising  the  professional  skills  of
Algerian police officials, especially as regards upholding human rights in the
performance of their duties. The project is part of efforts to strengthen good
governance and establish the rule of law.

In Tunisia, the identification phase of a media support project began in 2002.
With a total EU contribution of €2.5 million, the project should contribute to
raising 
journalists  and  strengthening
independent media in the country.

the  professional  skills  of 

the 

156

– 

Regional cooperation/Integration

Among the projects closed in 2002 the following deserve a special attention:

Some  “people  to  people”  projects,  part  of  the  Middle  East  Peace  Projects
initiative,  came  to  an  end  in  2002.  One  supported  the  staging  of  meetings
between  Israelis  and  Palestinians,  some  of  them  took  the  form  of  training
courses  on  peace  and  mutual  understanding  which  took  place  in  2001  and
2002.  Participants  were  teachers,  journalists,  youth  leaders,  students,  and
women.  MEDA  funding  amounted  to  €300.000,  covering  three-quarters  of
the  cost.  Another  initiative  enabled  Israeli  and  Palestinian  parents  whose
children had fallen victim to the conflict to engage in common activities for
promoting  peace,  reconciliation,  tolerance  and  democracy.  MEDA  support
covered 80%  of  the  total  cost  (€500 000).  Within  yet  another  project,  three
cultural  events  (an  exhibition,  a  film  and  video  festival  and  an  academic
workshop) brought together Israeli and Arab artists on the basis of the Arabic
language,  seen  as  a  means  of  communication  between  estranged
communities. The EU contributed €205 000, which accounted for 80% of the
costs. All the Middle East Peace Projects mentioned above ended in 2002 as
scheduled.

The ‘Regional Economic Integration Research Network, Phase 2’, one of the
Middle  East  Peace  Projects  (MEPP)  came  also  to  an  end  in  2002.  This  €1
million  project  entirely  funded  by  the  EU  produced  economic  studies  on
every  Mashreq  country  -  also  on  Israel  -  as  well  as  polls  on  the  economic
situation in those countries, and on the region at large.

‘Sesame Street’ for the Middle East

Episodes  of  the  ‘Sesame  Street’  TV  series  for  children  are  being  produced  in  Israel,
Jordan, and the Palestinian Territories within a MEDA supported Middle East Peace
Project entitled  ‘Israeli-Palestinian-Jordanian Media  cooperation’.  The  main  purpose
of  the  project  is  to  promote  understanding  between  Israelis,  Jordanians,  and
Palestinians by improving each community’s view of the other. Following the success of
an  Israeli/Palestinian  co-production  of  Sesame  Street  (‘Rechov  Sumsum’/’Shara’a
Simsim’),  this  new  project  brings  together  an  Israeli  production  company  and  a
Jordanian  one,  along  with  the  Palestinian  Al  Quds  University  to  extend  the  original
initiative to Jordan, and to create educational material for children and teachers. The
project receives an EU grant of up to €2.5 million.

The MEDA project ‘New Approaches Regarding Telecommunication Policy
Among  Mediterranean  Partners’  with  funding  of  €2.15  million,  which
started in December 1999, was completed as planned in December 2002. The
project  involved  holding,  conferences  and  training  sessions  and  issuing  a
number of targeted publications. The objective was to raise awareness among
political  decision-makers  and  current  and  future  telecom  regulators  in  the
partners about the challenges posed by opening the sector to competition and
to private sector participation in infrastructure.

157

Pioneering Arab women in the arts

The  MEDA-funded  Euromed  Audiovisual  programme  (€2.15  million)  supports  the  co-
production of the TV series “Elles ...”. This  series of twelve episodes tells the story of
South  Mediterranean  women  who  became  pioneers  in  fields  such  as  cinema,  writing,
performing  arts,  and  politics  in  the  past  century.  One  of  the  released  films,  “Les
passionnées du cinéma” / “Cinema Lovers”, gives insights into the life and work of six
women  (Egyptian  and  Lebanese)  film  directors,  producers  and  actresses  in  Egypt,
among  whom  Assia  Dagher,  Fatma  Roushdi  and  Marie  Queenie.  Another  film,  “The
legend of Rose Al-Youssef” describes the extraordinary career of a Lebanese woman of
the same name, who in Egypt moved from actress to political writer, and presents her
against  the  backdrop  of  her  time.  Some  of  these  films  have  already  been  selected  for
various festivals.

Concerning ongoing regional programmes, major achievements in 2002 were
the  launch  of  six  calls  for  proposals  and  eight  calls  for  tenders  covering  a
variety  of  programmes  and  issues,  such  as  transport,  water,  and  youth
exchanges.  An  important  effort  was  also  made  to  enhance  information  and
communication activities through the organisation of three information visits
for Mediterranean media.

In  November  2002  EU  Member  States  approved  two  major  regional
programmes.  One  of  the  programmes  is  the  Euromed  Information  and
Communication Programme (€10 million), designed to increase the visibility
of  the  Barcelona  Process  and  promote  mutual  understanding  in  the  Euro-
Mediterranean region. Under the title ‘Good Governance and Enhancing the
Rule of Law’, the other programme (€6 million) will focus on judicial reform
and cooperation, fighting organised crime and drug trafficking, and ensuring
a common approach on migration.

– 

Civil society and local development

Social  funds  were  put  in  place  in  the  early  nineties  to  alleviate  the  social
consequences  of  structural  adjustment  processes.  They  evolved  from
temporary  facilities  to  institutions  developing  sustainable  solutions  to
unemployment  and  poverty.  Among  the  social  funds  supported  by  the  EC,
Jordan’s social fund (see box) ended in 2002.

Social funds/local development (Jordan)

The objective of the “Social Development Project Development and Employment Fund”
in Jordan (EU contribution: €4.67 million) was to alleviate some of the adverse effects
of  the  adjustment  process  on  the  poor  by  providing  support  to  income-generating
activities.  Small  loans  were  provided  to  intermediary  organisations  for  on-lending  to
local  credit  schemes  managed  by  local  beneficiaries.  Training  and  capacity  building
activities  were  also  supported.  The  project  performed  well  from  a  financial  point  of
view (notably good repayment rate)  and  in  its  capacity-building  objective.  It  has  also
demonstrated the difficulty of reaching the very poor. In addition to making a positive
contribution to poverty reduction, this small project has produced results that will be
used in designing new EC-sponsored activities in the field of poverty reduction.

In  2002,  four  projects  totalling  €62.5  millions  were  committed.  The
following three deserve a specific mention:

158

In  Algeria,  the  project  “Support  to  local  socio-economic  development  in
north-east  Algeria”  (EU  contribution:  €50  million)  seeks  to  reduce  poverty
and to improve the living conditions of the population in this poor region.

Two  projects  concerning  civil  society  were  also  decided:  the  “Programme
for  the  Promotion  of  Human  Rights  and  democratisation”  in  Jordan  (EU
contribution:  €2 million)  will  finance  a  range  of  actions  for  NGOs  and
associations.  The  “Electoral  Support  Project”  in  Yemen  (EU  contribution:
€500 000),  will  support  preparations  for  the  parliamentary  elections  to  be
held in  April  2003 as a contribution to  the  consolidation  of  democracy  and
pluralism in Yemen.

– 

Transport and Infrastructure

For  all  the  EU’s  partner  countries  in  the  region  the  development  and
strengthening of basic infrastructure is of capital importance and a sine  qua
non  of  their  economic  and  social  development.  The  operations  financed
under the MEDA programme in support of economic reforms, development
of  the  private  sector,  health  and  education,  and  so  on  are  always  based  on
availability  and  functionality  of  transport,  drinking  water,  energy  and
telecommunication infrastructure networks.

In the West Bank and the Gaza Strip, the European Commission carried out
an  extensive  and  rapid  damage  and  capacity  assessment  of  the  large-scale
destruction  inflicted  upon  civil  infrastructure  and  institutional  capacity  in
villages  and  towns  of  the  Palestinian  territories.  In  2002,  the  project
“Damage Assessment and Reconstruction Management in the West Bank and
Gaza Strip”, (EC contribution of €1.9 million) was completed .

A database gives technical information about more than 2000 reconstruction
and  development  projects  in  more  than  150  Palestinian  towns  and
municipalities.115

Among  the  ongoing  projects,  the  conclusion  of  the  11th  Framework
Convention with the United Nation Relief and Works Agency (UNRWA) to
direct  EU  aid  towards  Palestinian  refugees  in  the  Near  East  for  a  total
contribution of €237 million over a four  year period (2002-2005) deserve a
special mention.

Two major projects were committed in 2002 reaching a total of €50 million
in the West Bank and Gaza Strip and in Tunisia.

– 

Food Security and Rural Development

Food  Security  Programme  in  Palestine:  the  cooperation  between  the
European Union and UNRWA results from the history of relations between
Israel and Palestine, which has created one of the largest refugee community
in  the  world.  There  are  now  3.9  million  Palestinian  refugees,  of  whom  1.6

115

http://www.ecwbg.info

159

                                                
million in Jordan, 396 000 in Syria, 385 000 in Lebanon, 618 000 in the West
Bank and 865 000 in the Gaza Strip (82% of the population).

The  objectives  of  the  food  security  programme  complement  the  other  EU
allocations,  particularly  those  for  health  and  education.  The  programme
responds to the basic survival needs of the neediest section of the population.
Social assistance is correctly handled with emphasis on those who are really
most  in  need,  with  coverage  of  both  SHCs  (special  hardship  cases)  and
pregnant  and  nursing  women  (over  200  000  SHC  individuals  and  50  000
families and almost 100 000 pregnant and nursing women).

Over  350  000  families  (over  200  000  of  them  through  the  UNRWA)  have
benefited from emergency distributions.

In 2002 five projects totalling €8.3 million were committed in the West Bank
and  the  Gaza  Strip.  The  project  Food  aid  contribution  to  emergency
operations  in  support  of  the  civilian  population  is  the  most  important  (€5
million).

Rural development sector:

Bilateral  cooperation  in  the  MEDA  region  in  support  of  sustainable  rural
development  and  environmental  protection  is  built  on  the  principles  and
strategies set  out  in the  1995  Barcelona  Declaration.  These  objectives  were
included in the Association Agreements concluded between the EU and most
countries of the Southern and Eastern Mediterranean.

The  overall aim  of  this  cooperation  is  to  improve  living  conditions  in  rural
areas and reduce poverty. Specifically, under the Association Agreements it
takes  the  form  of  strengthening  Euro-Mediterranean  cooperation  in  the
following key-sectors:

– 

– 

– 

– 

cooperation  on  agriculture  and  fisheries, 
through
harmonisation of standards and of plant health and veterinary controls,
technical  assistance  and  training,  and  promotion  of  environmentally
friendly agriculture and fishing;

in  particular 

standardisation  and  evaluation  of  the  conformity  of  agricultural
produce thanks to staff training and upgrading of equipment;

halting environmental degradation;

cooperation  on  consumer  protection  and  health  and  food  security
through  the  setting-up  a  warning  network  connected  to  the  European
network.

An  important  part  of  MEDA  cooperation  concerns  the  improvement  of
farming and the agri-food industries in the beneficiary countries with a view
to a Euro-Mediterranean free trade area by 2010.

160

On the operational side, two projects were completed in 2002:

In Morocco, the project Aménagement Hydro-agricole du  Haouz  Central  et
de la Tessaout Aval with an EC contribution of €21 million for agricultural
development, has improved the irrigation and socio-economic conditions of
about  36  000  ha  in  the  area  north-west  of  the  High  Atlas  Mountains.  The
operations  were  implemented  over  seven  years;  they  also  included  the
improvement of infrastructure (construction of over 200 km of access roads),
institutional development and special programmes for women. More than 60
000 people have benefited from this programme.

In  Tunisia,  the  €22  million  project  Création  de  palmeraies-dattiers  dans  la
région  de  Régim  Maatoug,  of  which  7  million  cofinanced  by  the  Italian
Government, has been realised under difficult circumstances.

In  Egypt,  the  €20  million  project  entitled  Veterinary  Service  programme
aimed  at  the  improvement  of  the  livestock  productivity  and  veterinary  and
public  health  in  the  country  through  a  privatisation  programme  of  the
veterinary  services.  During  the  project  implementation,  more  than  3  000
government  veterinarians  left  the  public  service  and  converted  in  private
practice, 700 of whom thanks to the credit facilities providing funds for the
development  of  alternative  employment.  The  project  also  supported  the
overall reform of the public veterinary sector through multiannual  technical
assistance.

A  mid-term  review  was  carried  out  in  2002  for  the  project  Fonds  de
Développement Agricole (FDA) in Morocco.

Fonds de Développement Agricole (Morocco)

In  Morocco,  poverty  is  principally  concentrated  at  rural  level.  Despite  a  significant
improvement in social sector indicators, such as primary education, adult literacy and
life expectancy, according to a recent study carried out by the World Bank, one out of
three Moroccans in rural areas is poor, against one out of ten in urban agglomerations.

Targeted at small farmers in less well-off areas, a financial support programme funded
through local credit banks has reached this poorer section of the rural population. The
demand-driven  scheme  favours  productive  but  limited  investments,  mainly  related  to
small-scale irrigation, which has boosted the productive efficiency of small farmers and
increased  their  revenues.  Being  successful  in  contributing  to  poverty  reduction  and
limiting  locally  the  rural  exodus,  the  scheme  has  so  far  benefited  more  than  80  000
farmers, of whom about one-third are first-time customers of local credit banks.

Concerning ongoing projects in the Mashreq countries, notably in Egypt, in
2002  the  EC  continued  to  support  the  development  of  the  agri-food  sector
and  small  on-farm  irrigation,  with  a  special  focus  on  the  creation  of  new
jobs.  In  Tunisia  and  Morocco,  the  main  activities  have  concerned  the
sustainable  rural  development,  focused  on  poverty  alleviation,  and  the
settlement of rural populations and in Yemen, a new project started up in the
fisheries sector.

The project Arganier (EU contribution: €6 million) was  committed in 2002
in Morocco. This project centred on the operation of the “Arganeraie” for oil
production will provide added value to women of the region.

161

– 

Health

In  MEDA  countries  the  focus  of  the  EC  health  sector  support  has  moved
from  single-issue  projects,  concerning  specific  health  problems,  to  broader
the  health  sector.
programmes  based  on  structural  components  of 
Capitalising  on  Europe’s  experience  in  this  field,  one  of  the  main  issues
addressed by the European aid is the introduction of social health insurance
schemes  to  finance  access to  a  basic package  of care, provided  by both  the
public and private sectors.

Two  “population”  projects  were  on  the  point  of  completion  in  2002:
“Support  to  maternal  and  child  health”  in  Morocco  (EU  contribution:
€9 million)  and  “Demographic  Sector  Support  Programme”  in  Syria  (EU
contribution:  €2  million).  The  short-term  objectives  of  these  reproductive
health care programmes - improving access to and quality of maternal, child
health  and  family  planning  services  -  have  been  attained.  However,  the
sustainability of these projects depends on the efficiency of the public health
systems in these countries (devolution of decision making, staff motivation,
monitoring  and  accountability  mechanisms,  etc…).  More  recent  health
programmes  like  those  in  Morocco  and  Syria  have  therefore  taken  a  more
systemic  approach  to  health.  These  health-sector  reform  programmes
embrace  decentralisation,  increased  hospital  autonomy  and  support  to  the
development of new health financing mechanisms (particularly social health
insurance).

As  regards  ongoing  projects  in  the  health  sector,  experience  gained  from
projects  in  Morocco  and  Syria  has  led  to  the  design  of  comprehensive
sectoral  approaches.  As  an  example  of  successful  intersectoral  cooperation
on  health,  the  EC  project  in  Egypt  “Support  to  Population  Programme  in
Upper Egypt” (EU contribution: €10 million) is to be earmarked. As part of
its health promotion activities, this project has produced a documentary and
10  TV  spots  that  are  effectively  helping  to  raise  awareness  on  family
planning and reproductive issues among women in Upper Egypt. One of the
spots  has  been  awarded  a  prize  by  the  International  Advertisement
Association for the best TV spot on social issues for the year 2002.

In 2002 four projects totalling €50 million have been committed, one in Syria
and three in the West Bank and Gaza Strip.

– 

Education

In  2002  important  interventions  in  some  MEDA  countries  (notably  Tunisia
and  Algeria)  were  designed  to  improve  the  competitiveness  of  national
enterprises  and  also  facilitate  the  access  of  unemployed  people  and  job-
seekers  to  the  labour  market.  The  new  generation  of  vocational  training
projects  have  several  goals:  developing  and  strengthening  management  and
identification  of  skills  needs  by  businesses,  capitalising  on  the  results
achieved  by  professional  organisations,  modernising  and  reorienting  both
public  and  private  vocational  training  delivery  according  to  identified  skill
needs,  and  upgrading  the  quality  of  the  management  of  the  vocational
training centres to international standards.

162

One  project  was  completed  in  2002:  in  Jordan,  the  project  “Improving
Teacher  Education  at  Jordanian  Universities”  (EU  contribution:  €3.9
million) was been implemented from April 1996 to June 2002. The setting-
up  and  institutionalisation  of  classroom  practice  in  Jordanian  teacher
training,  the  establishment  of  institutional  cooperation  between  universities
and  schools,  the  provision  of  equipment  and  extensive  training  for
supervisors and cooperative school teachers can be considered as significant
improvements  in  the  whole  pre-service  teacher  training.  In  addition,  with  a
view to capacity building among faculty staff, the project gave 25 PhD and
six MA students the opportunity to study in Europe in relation to the .

A  mid-term  review  has  been  also  carried  out  for  the  MEDA  I  project  in
Morocco,  “Upgrading  vocational  training”  (EU  contribution:  €38  million).
All  initiatives  of  the  first  component  have  been  completed  (upgrading
enterprise  capability  to  identify  and  manage  skill  needs  and  plan  training)
and the second launched (upgrading the supply of training  for 14  economic
sectors  targeted  by  the  project).  Performance  indicators  have  been  set,  and
the capitalisation  of results and  piloting  of the  project will  be  strengthened.
As  for  the  third  major  component  (developing  apprenticeships),  the
beneficiary has been asked not to delay its start further. It is worth noting that
two  other  projects  in  the  same  sector  complement  this  specific  project  and
deepen its impact.

Concerning  ongoing  projects,  two  deserve  a  specific  attention:  the  HIBA
project  in  Syria  (Higher  Institute  for  Business  Administration  -  EU
contribution: €14 million) which effectively started up in 2002, addresses the
country’s specific needs for highly  qualified managers  and is meant  to  lead
private or public companies facing economic adjustment processes.

Similar  developments  were  also  experienced  in  the  labour  market  and
policies  with  the  MANFORM  project  in  Tunisia  (EU  contribution:  €45
million), launched in 1998, which is the first of a new generation of demand-
led  vocational  training  projects  financed  by  the  MEDA  programme  which
continue  to  be  successfully  implemented.  About  170  enterprises  have  been
surveyed  and  their  needs  in  skills  and  management  of  human  resources
identified.  The  delivery  of  vocational 
training  has  been  reoriented
accordingly.  The  sector-wide  ambitions  of  this  project  have  nourished
ongoing or projects starting up in other MEDA countries such as Morocco.

the  area  of  social  development,  grassroots  approaches 

In 
local
development  -  addressing  problems  locally  and  giving  support  to  civil
society - complement the range of health, education and vocational training
interventions.

to 

In 2002, two major education  and  vocational  training  projects  totalling  €83
million  were  committed:  “Assistance  to  the  Reform  of  the  Technical  and
Vocational  Education  and  Training  System”  in  Egypt  (TVET  –  EU
contribution  €33  million)  and  “Support  to  the  upgrading  of  vocational
training  in  the  textile,  tourism  and  new  technologies  of  information  and
communication (NTIC sectors)” in Morocco (EU contribution: €50 million).

163

–  Macroeconomic Policies

The  definition  of  priority  areas  under  the  NIP  makes  it  possible  to  specify
better  the  objectives  and  the  fields  of  intervention  of  direct  budgetary
support.  In  2002,  economic  growth  in  the  Mediterranean  region  slowed
considerably,  mainly  as  a  consequence  of  low  global  growth,  increased
regional  security  problems  and  domestic  policy  factors  in  some  countries.
Overall  GDP  growth  in  the  region  fell  from  4.3%  in  2000  to  an  expected
1.6% in 2002.116

The  transition  process  of  the  economies  of  the  Southern  Mediterranean
countries remains characterised, among other things, by low productivity of
investment and foreign direct investment flows  that are lower  than  those of
other  regions  having  the  same  per  capita  level.  Independently  of  recent
events,  the  region  needs  to  accelerate  the  implementation  of  economic
reforms aiming at the setting up of a regulatory framework favourable to the
growth of the private sector and to the development of competitive markets.
In this context, the Commission continues its support for this reform process
through a better targeting of budgetary support. Indeed, budgetary support is
an essential instrument for consolidating the Euro-Mediterranean partnership
and supporting the economic transition of the MEDA countries. Within this
framework, the Commission strengthened:

Coordination  with  the  international  financial  institutions  (International
Monetary  Fund  and  World  Bank  –  see  6.3.4.1)  and  the  need  for  regular,
on-the-spot  monitoring  of  the  implementation  of  programmes:  funds  for
technical monitoring and final evaluation are earmarked for all programmes
approved since January 2001.

Two projects closed in 2002 which are worth special mention.

In  Algeria the 1996  Financing  Agreement  for  €125  million  in  two  tranches
from the Structural Adjustment Facility (SAF) has provided support  for  the
structural  reform  process  involving:  (i)  reform  of  public-sector  companies,
including privatisation; (ii) reform of the housing sector; (iii) development of
the agricultural sector; (iv) reform of trade policy and (v) implementation of
a  welfare  system.  The  first  tranche  of  €60 million  was  disbursed  in  1998
following  a  favourable  evaluation  of  the  criteria  for  paying  out  the  funds.
The difficulties encountered in establishing the conditions for payment of the
second  tranche  led  to  the  project  being  prolonged  twice.  In  view  of  the
results  obtained  -  in  particular  in  foreign  trade  liberalisation  -  the
Commission  decided  to  disburse  funds  proportional  to  the  results  and,  by
agreement with the recipient, revised the amount of the second tranche down
to €35 million. The disbursement of this second tranche in June 2002 marked
the technical closure of the programme.

In  Egypt  a  €43 million  programme  to  reform  and  privatise  state-run
companies  under  an  old  protocol  provided  support  for  the  privatisation  of

116

Excluding Cyprus, Malta and Turkey.

164

                                                
manufacturing companies and provision of technical assistance to the Office
des Entreprises Publiques (Office of Public Companies). This project lasted
six and a half years and closed at the end of the technical assistance contract
in March 2002.

Six projects were the subject of a mid-term review.

In  Algeria, the  recommendations  made  in  the  evaluation  of  the  Support  for
SMEs project significantly improved the project’s impact on Algerian SMEs.

The evaluation of the Industrial Modernisation Programme in Lebanon one
year  after  start-up  led  to  detection  of  a  delay  in  implementing  the  project,
which will rapidly remedied.

In  Morocco  evaluation  of  the  Programme  to  develop  the  private  sector
(Euro-Morocco Entreprise-EME) showed that this programme - in spite of a
difficult start - had substantially improved its performance in 2002 thanks to
the  appropriate  measures  taken  jointly  by  the  EC  and  the  benefiting
contractor.

Again  in  Morocco,  evaluation  of  the  Programme  to  promote  quality
(QUALITE),  revealed  a  delay  in  implementation,  leading  to  extension  of
technical  assistance  for  a  further  year  with  a  view  to  achieving  the  initial
goals.

In Tunisia evaluation of the Programme to develop the private sector (Euro-
Tunisie  Entreprise  ETE)  showed  that  it  had  got  into  gear  after  a  difficult
operational  start-up.  This  programme  of 
in
harmoniously  with  the  Tunisian  system  of  upgrading  vocational  skills  and
ensures the sustainability of assets.

targeted  operations  fits 

In Syria the mid-term evaluation of the Syrian European Business Centre II
(ESCB II) project, completed in October 2002, reported that the project  and
its impact on the recipients were highly satisfactory. The evaluation proposes
more  emphasis  on  sustainability  and  institutional  capacity-building  for  the
project  over  the  remaining  period.  In  view  of  the  scale  of  the  demand,  an
amendment  to  the  Financing  Agreement  to  authorise  a  budget  increase  is
envisaged for the third year of the project.

There have substantial improvements and radical overhauls of some ongoing
projects,  such  as  the  programme  of  budgetary  support,  Trade  Enhancement
Programme -TEP-A, in Egypt. This project to dismantle non-tariff barriers is
the Commission’s first adjustment operation in the country and was bolstered
in 2002 by a €40 million technical assistance project (TEP-B).

In Algeria, the project Support for privatisation was radically restructured to
allow  the  Community  to  finance  the  expenses  of  the  merchant  banks
involved in the privatisation operations.

165

In Jordan the signing of an agreement on pension reform under the Structural
Adjustment Facility III (SAF III, €60 million) was a major success in view of
the difficult regional context.

In  Tunisia  a  new  €50  million  industrial  modernisation  programme  widened
the  scope  of  the  Euro-Tunisian  Business  Centre  project  by  adding  an
economic and financial policy component.

Quick-disbursing  budgetary  support  of  €10  million  a  month  for  the
Palestinian  Authority  continued,  with  important  results  for  the  reforms
adopted.  The  Commission  also  carried  out  two  emergency  financial
assistance  projects  to  remedy  the  deteriorating  situation  of  SMEs  in  Gaza
(€10 million) and East Jerusalem (€5 million).

Nine new projects were decided in 2002 for a total of €219 million, including
two  macroeconomic  structural  adjustment  projects:  Structural  Adjustment
Facility  III  (SAF  III)  in  Jordan  and  the  Trade  Enhancement  Programme  B
(TEP B) in Egypt.

– 

Environment

Among the projects closed in 2002, the following deserve a specific mention
by reason of their impact:

In  Egypt,  in  the  framework  of  the  EC  support  for  the  protection  of  natural
resources  in  the  South  Sinai  region,  the  main  objective  of  the  project  Oil
Pollution  Combating  Centre  at  the  entrance  of  the  Gulf  of  Aqaba  was  the
setting up of an emergency centre for oil spills prevention. The project also
supported  the  establishment  of  procedures  and  mechanisms  to  combat  oil
pollution at the entrance of the Gulf of Aqaba. The total EC contribution has
been €4.3 million, and the duration of the project ten years. After completion,
the  centre  has  been  transferred  to  the  Egyptian  Environmental  Affairs
Agency.

The Gulf of Aqaba (Egypt)

The Gulf of Aqaba is an area of exceptional ecological and tourist value suffering from
severe  oil  spill  pollution,  the  levels  of  which  are  largely  outside  the  international
conservation standards. The project was part of the overall support to the sustainable
development of the South Sinai Region, which the EC is providing since the beginning
of  the  80s.  An  emergency  response  centre  has  been  set  up  close  to  the  harbour.  The
centre  has  been  equipped  with  a  hangar,  an  anti-pollution  vessel,  a  research
laboratory,  office  space  and  other  small  facilities.  Local  permanent  staff  has  been
trained  by  the  project  to  prevent  and  face  situations  of  oil  spill  crisis.  The  overall
intervention capacity of the centre is estimated at about 150 tonnes of petrol.

The  project  Gulf  of  Aqaba  Protectorates  Development  Programmes
consisted  in  preparing  and  implementing  general  -  and  also  sectoral  -
integrated management plans,  procedures and regulations for four protected
areas in the South Sinai Region in order to ensure the long-term conservation
and  sustainable  use  of  natural  resources  and  cultural  values.  An  important
component  of  this  project  was  technical  and  institutional  capacity  building
within  the  “Nature  Conservation  Sector”  (NCS),  the  Egyptian  body

166

responsible  for  sustainable  environmental  and  tourist  development  of  the
Protectorates;  the  aim  was  to  facilitate  implementation  of  the  National
Strategy  for  Biodiversity  Conservation.  The  project  has  lasted  seven  years
and the EC has funded €10 million of the €12 million total.

In Yemen the objective of the Socotra Archipelago project was to prepare a
comprehensive  masterplan  for  the  economic  and  social  development  of  the
Socotra  Archipelago  by  giving  special  attention  to  environmental  policy,
administrative  management  and  considering  the  unique  environmental
situation.

The Socotra Archipelago (Yemen)

The Yemen is renowned world-wide for a high percentage of endemic flora and fauna
and a unique bio-diversity. By taking into consideration the particular environmental
situation  of  the  Socotra  Archipelago,  the  Commission  provided  financial  support
(€0.995  million)  to  the  preparation  of  a  comprehensive  and  multi-sector  master  plan
study  for  its  sustainable  and  environment  friendly  development.  This  study  was
completed and reported, and its output is the proposition of some 69 projects outlining
a total cost of about €200 million. The proposed action plans have been transferred to
the  Yemenite  authorities  and  are  therefore  available  for  further  EC  or  other  donors
funding.

As  to  ongoing  projects  for  natural  resources  protection,  efforts  in  2002
focused  on  consolidating  the  support  for  the  Tunisian  national  strategy  for
the mobilisation of surface water  and soil protection and for the sustainable
development  of  the  South  Sinai  Region  in  Egypt.  In  all  countries,
institutional  support  activities  have  been  strengthened  through  targeted
technical  assistance.  Work  to  gain  a  better  understanding  of  sustainable
water-resource  management  in  rural  development  in  the  region  has  been
undertaken and its results will support the new coming EU Water Initiative.
Work has also been initiated in the area of animal health risks in relation to
the liberalisation of trade in the Mediterranean basin. At last, a first general
reflection  on  the  Kyoto  Protocol  and  the  possibilities  of  implementing  the
agreement in the Mediterranean Region were also initiated.

In  2002  at  last,  the  new  project  water  purification  has  been  committed  in
Egypt for a total amount of €25 million.

– 

Partnership with NGOs

In  2002,  19  projects  were  cofinanced  with  European  NGOs  in  MEDA
countries for  a  total  EU  contribution  of  €13.9  million.  18  projects  were
selected from the 60 proposals received for MEDA countries under a call for
proposals  launched  in  December  2001.  One  project  had  already  been
submitted  under  the  call  for  proposals  in  2000  but  was  only  approved  in
2002.

The priorities were:

– 

Support  to  sustainable  social,  human  and  economic  development
processes;

167

– 

Institutional  support  and  capacity  building  for  local  development  of
structures, including partner organisations in developing countries;

– 

Refugees/Population.

Under  the  eleventh  Convention  between  the  European  Community  and
UNRWA,  the  two  parties  signed  the  annual  grant  agreement  for  the  West
Bank and Gaza Strip (WBGS) - €55 million for 2002 on the UNWRA budget
line - on 11 November 2002. This assistance is an important contribution to
UNRWA, which provides education, health, relief and social services to 3.9
million registered  Palestinian refugees in  Jordan,  Lebanon,  the  Syrian  Arab
Republic,  the  West  Bank  and  the  Gaza  Strip.  In  particular,  it  promotes
sustainable  social  and  economic  development  of  the  concerned  refugees  in
the hosting countries and hence contributes to the stabilisation of the current
situation in the Middle East.

6.3.4

The Three Cs (Coherence, Coordination and Complementarity in the Region)

The  EC  made  extensive  efforts  in  the  Mediterranean  zone  to  ensure  and
strengthen  the  coherence  between  different  Community  policies.  Various
inter-service  consultation  groups  were  set  up  to  cover  key  sectors  like  the
trade related assistance group  and a similar consultative group in the  health
sector. In order to improve both the coherence of the priority objectives and
the  complementarity  of  the  funded  projects  and  programmes  with  those  of
the  other  EU  and  non-EU  donors,  the  Commission  has  also  worked  to
reinforce  the  coordination  of  the  Country  Strategy  Papers.  To  this  end
coordination guidelines decided  within the framework  of  the Mediterranean
Committee  were  implemented.  These  guidelines  include  the  holding  of
regular  cooperation  meetings  related  to  key  sectors  (water  management,
health, etc.).

6.3.4.1 Cooperation with Member States and other Donors in the Region

In the social sector, consultations and cooperation with EU Member States
and  other  bilateral/multilateral  donors  were  stepped  up  and  systematised
during appraisal of new 2002 projects (i.e. in the field of vocational training
for  Egypt  and  Morocco  and  in  the  health  sector  for  West  Bank  and  Gaza
Strip,  Syria  and  Yemen).  Regular  consultations  and  mutual  information
meetings  are  organised  by  the  EU  Delegations  in  countries  of  the  region.
Exchanges  of  information  and  cooperation  between  operational  services  at
Headquarters  and  other  multilateral  donors  and  agencies,  in  particular  the
World  Bank  (joint  sector  reviews)  and  other  UN  agencies  (United  Nations
Development  Programme;  International  Labour  Organisation,  etc.)  are  also
being stepped up.

Rural  development  and  environment  sectors:  coordination  with  Member
States is organised directly by the Delegations through regular meetings.

Macroeconomic  policies.  In  Tunisia,  the  Structural  Adjustment  Facility  III
(SAF  III)  has  been  implemented  in  parallel  with  a  World  bank  loan
(Economic  Competitiveness  Adjustment  Loan  –  ECAL  III).  These  two

168

programmes share similar objectives and are supervised by the World Bank
and European Commission jointly.

In  Jordan  SAF  III  in  support  of  the  government’s  tax  consolidation
programme was implemented in cooperation with the IMF. The disbursement
of SAF funds was conditional on a favourable prior evaluation of progress in
the tax reform programme by the IMF.

6.3.4.2 EIB activities

In follow-up to the European Council held in Barcelona in March 2002, the
the  Facility  for  Euro-
European  Investment  Bank  (EIB) 
Mediterranean  Investment  and  Partnership  (FEMIP)  to  put  a  greater  focus
on private  sector development in its activities  for the  region. The  European
Commission has pledged €255 million over four years to this operation.

launched 

In Egypt, the Commission granted an interest rate subsidy to a new EIB loan
in  the  infrastructure  sector  aimed  at  environmental  protection.  The  project
deals  with  water  treatment  in  Abu  Rawash.  The  total  cost  of  this  project  is
€110  million  and  the  interest-rate  subsidy  is  €25  million.  The  project  will
help  the  city  of  Cairo  meet  growing  needs  in  for  waste-water  treatment
infrastructure, in line with the Egyptian Government’s effort to comply with
local environmental regulations.

In Algeria, a €6 million conditional loan was granted for the construction and
operation of a new cement plant.

Under  the  new  Euro-Med  Lending  Mandate  (II),  the  EIB  is  to  lend  up  to
€6.425 million  in  the  period  2000-2006,  supplemented  by  €1  billion  on  its
own  resources.  EIB  loans  to  Mediterranean  partners  in  2002  stood  at  €1.8
billion  against  €1.50  billion  in  2001.  Of  that  amount,  nearly  €307  million
were lent under the new Facility. The main beneficiary sectors were transport
(€605 million), energy (€510 million) and industry (€232 million).

6.3.4.3 ECHO

ECHO continued its major aid programme for Sahraoui refugees in Algeria,
with  a  global  plan  worth  €14.34  million  to  cover  food  requirements,
supplementing the World Food Programme (WFP) and the most urgent non-
food requirements.

In  the  Middle  East,  the  humanitarian  situation  worsened,  especially  in  the
Palestinian  territories,  as  a  result  of  incursions  and  partial  reoccupation  by
the Israeli armed forces, together with large-scale destruction and bans on the
movement  of  persons  and  goods.  ECHO  therefore  had  to  become  more
involved, providing aid of €35 million covering both needs in the Palestinian
territories  and  the  refugee  camps  in  Lebanon,  Jordan  and  Syria.  In  the
Palestinian  Territories,  this  funding  is  mainly  used  to  cover  drinking  water
access  and  supply,  food  aid,  provision  of  basic  health  services,  preventing
cases of malnutrition  from  getting worse,  organising  psychosocial  activities
for  traumatised  children  and  adolescents  and  protection  of  the  civilian

169

population  by  the  International  Committee  of  the  Red  Cross  (ICRC).  In
Lebanon, €6.3 million was earmarked for access to drinking water, repair of
drainage systems, improving health services and aid for the disabled. ECHO
allocated €600 000 each to Jordan and Syria for temporary housing needs.

ECHO  was  active  in  Iraq  (global  plan  totalling  €13  million),  where  the
humanitarian  situation  is  deteriorating  as  a  consequence  of  two  major
conflicts  -  the  Iran-Iraq  war  and  the  Gulf  war  -  followed  by  12  years  of
the  country.  ECHO  supported
international  sanctions 
humanitarian  operations  completed 
the  United  Nations  oil-for-food
programme in the health, water and sanitation sectors.

imposed  on 

Finally, ECHO also granted €1.59 million to the most vulnerable members of
the  rural  population  in  Yemen,  victims  of  tribal  tensions  and  natural
disasters.

European Community Humanitarian Office’s (ECHO) Financing Decisions 2002
(€ million)

Country

Algeria (Sahraoui refugees)

Middle East (Palestine)

Iraq

Yemen

Total

6.3.5

Results-oriented Monitoring

Amount

14.430

35.000

13.000

1.590

64.020

In the year 2002, a total of 189 monitoring visits were made to 20 countries
(including  6  EU  countries)  for  108  projects  in  the  Mediterranean  region.
These  projects  concern  all  budget  lines  (notably  MEDA  but  include  also
other specific and horizontal lines like NGOs, human rights and democracy).

In  the  Mediterranean  region,  several  national  components  of  the  same
regional programme - as well as the regional coordination - were visited and
reported  upon,  resulting  in  the  production  of  more  than  one  report  for  a
single programme.

The  objective  of  creating  a  Euro-Mediterranean  free-trade  area  by  2010
underlies  the  large  number  of  regional  programmes  in  the  Mediterranean
region,  plus  projects  in  the  areas  of  trade/private  sector  and  institution
building/good  governance.  The  latter  is  the  priority  area  with  the  most
positive  results,  particularly  for  effectiveness,  i.e. the  benefits  actually
received by people.

A sample of the 10 best performing projects indicate as good practice that:

– 

the  original  design  was  carried  out  in  consultation  with  the  local
partners and beneficiaries, and is relevant to national context;

170

– 

– 

the flexibility and ability to adjust well to important changes in needs
of  the  recipient  side  through  a  redesign  of  the  project  while  in
implementation stage;

the  approach  was  demand-driven  and 
experience.

took 

into  account  past

However some negative points were  also underlined, notably the fact that a
number  of  MEDA  I  projects  (1995-1999)  suffered  from  serious  delays  at
start-up.

Results-oriented Monitoring: Breakdown of projects visited by area of
cooperation
(€ million)

2002

Number
of Reports

Number of
Programmes
and projects

Total budget

Average size

1 Trade + Development

2 Regional Integration

3

Macroeconomic+Social
Services
4 Transport117

5

6

Food  Security  +  Rural
development

Institutional  capacity  +  good
governance

7 Other

5

117

9

0

28

24

6

5

44

9

0

24

23

3

73 877 000

14 775 400

232 629 009

5 238 059

232 478 234

25 830 915

0

N/A

362 453 751

14 962 374

247 856 438

10 776 367

23 389 697

7 796 566

Total

189

108

1 172 684 129

 79 379 681

6.3.6

Conclusions and Perspectives

The year saw a remarkable improvement in the budgetary programme of the
MEDA  programme,  which  has  been  the  main  instrument  of  Euro-
Mediterranean cooperation since its launch in 1995.  The  efforts made since
implementation of MEDA II started in 2000 have produced  a major leap in
payments as a proportion of commitments, 73% in 2002.

the  Euro-Mediterranean  partnership: 

From the operational point of view the it was an important year of transition
for 
first  year  of
implementation of the NIPs and the RIP, which will determine the priorities
and  financial  resources  for  development  of  the  Southern  Mediterranean  for
three years.

it  was 

the 

117

Only  one  regional  transport  programme  was  monitored  and  is  counted  under  regional
integration.

171

                                                
The  Commission’s  external  objectives  for  2003,  stability  and  security,  and
sustainable, mutually reinforcing economic development, form the two main
strategic platforms for the Community’s future interventions.

In this perspective the Mediterranean is a priority of EU external policy. The
aim  is  to  forge  ever  closer  links  with  the  Southern  Mediterranean  and
Middle East  countries  with  a  view  to  achieving  the  Barcelona  process
objectives’ of peace, stability, democracy and prosperity.

In 2003  and  future  years EU  action in the Mediterranean with focus  on the
following issues.

Stability: renewed efforts will be made in the framework of the partnership,
especially  the  regional  component  of  the  Barcelona  process,  to  achieve  a
peaceful and lasting settlement to the current Middle East conflict.

Economic,  social  and  environmental  cooperation:  the  stepping-up  of  the
Euro-Mediterranean  partnership  should  gradually  lead  to  a  true  Euro-MEd
internal market and ultimately to an area of not only free trade in goods and
services but also sustainable development and socio-economic cohesion. To
this end the Commission is striving to push forward bilateral trade relations
with  the  Mediterranean  countries  -  above  all  finalise  signing  of  all  the
Association Agreements - and will work to bring about a fairer North-South
and South-South balance of trade, also embracing environmental protection.

Strengthening justice and home affairs cooperation (refugees, right of asylum
and halting illegal immigration), including social, cultural and human issues:
more  attention  will  be  paid  to  regional  circumstances  in  the  MEDA
framework.

Support  for  democracy,  promotion  of  cultural  dialogue  and  heritage
preservation:  the  Commission  will  build  closer  relations  with  the  partner
countries,  underpinned  by  contact  mechanisms  to  promote  respect  for
fundamental rights and better understanding among the peoples and cultures
of the Mediterranean.

6.4.

AFRICAN,  CARIBBEAN  AND  PACIFIC  (ACP)  COUNTRIES  AND
OVERSEAS COUNTRIES AND TERRITORIES (OCTs)118

Of all the regions to which EC assistance is directed, Africa faces the greatest
challenges in reducing poverty, developing sustainably and strengthening its
institutions. Nevertheless in 2002, EU-ACP relations, particularly in relation
to  Africa,  saw  several  positive  developments  which  helped  to  promote

118

The OCTs comprise countries and territories which: are constitutionally linked with four EU
Member States – the UK, Netherlands, France, and Denmark; continue to be associated with
the EC  under the provisions of Part IV of the EU  Treaty;  previously  included  several  large,
mostly  African  states  (now  independent  ACP  members);  currently  number  20  members  in
total, all islands, with a total population of c. one million; which the EU cooperates with based
on a model increasingly different to its ACP counterpart; continue nonetheless to benefit from
the same financial instrument as ACP states, namely the EDF.

172

                                                
regional  integration,  national  ownership  of  the  development  process  and
partnership with other donors.
(cid:1)  EU and ACP states’ ratification of the Cotonou Agreement continued.
The  agreement,  a  20-year  EU-ACP  partnership  pact,  officially  entered
into force in April.

(cid:1)  Talks  were  launched  in  September  to  devise  EU-ACP  Economic
Partnership  Agreements  (EPAs),  innovative  accords  arising  from  the
Cotonou Agreement, as well as a €20 million facility to assist ACP states
in the negotiations, which are set to finish by the end of 2007. EPAs will
apply from 1 January 2008, and are intended to: further development and
poverty  eradication  in  ACP  countries;  strengthen  the  link  between  trade
and  economic  cooperation;  integrate  ACP  countries  into  the  world
economy;  promote  South-South  regional  trade  by  expanding  local  and
regional  markets;  and  thereby  encourage  ACP  countries  to  cooperate
politically.  A  €10  million  facility  was  also  launched  to  help  ACP  states
prepare for the Doha round of WTO talks.

(cid:1)  2002 saw the launch of the African Union (AU), which the Commission
considers  an  important  vehicle  for  promoting  Africa’s  socio-economic
development, regional peace and security, and political dialogue between
Africa  and  the  EU.  European  Commission  President  Romano  Prodi
welcomed  the  adoption  by  the  AU,  at  its  first  summit  held  in  Durban,
South  Africa,  in  July,  of  the  New  Partnership  for  African  Development
(NEPAD) as its socio-economic programme. The Commission pledged in
2002  to  support  the  AU’s  security  mechanism  (its  €12  million  proposal
for  AU  funding  was  subsequently  adopted  by  the  EU  in  February  2003)
and  believes  the  AU’s  creation  will  also  allow  more  structured  political
dialogue and reinvigorate the so-called ‘Cairo Process’.119

(cid:1)  An  EU-Africa  Ministerial  Conference  was  held  in  Burkina  Faso  in
November,  in  which  the  Commission  participated  actively  and  worked
closely with EU Member States in their talks with the AU.

(cid:1)  The first EU-OCT Annual Forum was held in the Netherlands Antilles,
also  in  September.  Contacts  intensified  from  January  2002  between
Commission  services,  OCT  representatives  –  in  particular,  the  newly-
constituted  OCT  Association  (OCTA)  –  and  the  EU  Member  States
concerned,  and  such  meetings  were  instrumental  in  preparing  for  the
forum  and  facilitating  OCTs’  access  to  instruments  to  which  they  are
eligible.

119

The ‘Cairo Process’ comprises political dialogue between the EU and Africa, started in April
2000,  on  eight  priority  subjects:  external  debt  management,  the  return  of  stolen  cultural
artefacts,  conflict  prevention,  Human  Rights,  democracy  and  good  governance,  regional
integration, HIV/AIDS prevention and treatment, food security and environmental protection.

173

                                                
6.4.1.

Strategic Goals and Achievements

Of  the  many  achievements  of  EC  external  assistance  to  ACP  countries  in
2002, three were perhaps most significant. First of these was the completion
of  virtually  all  programming.  Country  and  Regional  Strategy  Papers  (CSPs
and RSPs) were prepared in close cooperation with partner governments and
mandated  regional  organisations,  in  coordination  with  EU  Member  States,
and involved extensive consultation with non-state actors.

Most ACP CSPs were approved - 67 out of a total of 77 ACP countries had
received favourable EDF committee120 opinions of their CSPs by the end of
2002,  and  the  other  10  ACP  countries’  CSPs  are  likely  to  be  discussed  by
July 2003 – although political difficulties in Côte d’Ivoire, Haiti, Zimbabwe,
Liberia  and  Togo  led  to  the  suspension  of  development  cooperation,  and
halted  programming  progress  pending  changes  in  the  political  situation.
However, all six ACP Regional Strategy Papers (RSPs) received favourable
EDF  Committee  opinions  in  2002  and  were  approved.  Significant  benefits
should soon be derived in ACP countries from the completion of the process,
and are summarised below.

Strategic goals and achievements in ACP countries:
expected benefits of programming process completion

between:

1. Increased coherence

analysis  presented  in  CSPs  and  the  ensuing  choice  of
priority sectors

2. Closer coordination

3. 
complementarity

Greater

4. Clearer focus

development and other EC policies
between the EU and ACP partner governments; mandated
regional organisations; EU Member States; and EU and
ACP non-state actors
between EC and other donors’ assistance

poverty reduction prioritised

fewer sectors assisted than in the past

cross-cutting issues (as defined in the Cotonou Agreement)
mainstreamed,  i.e.:  good  governance;  gender  equality;
environmental 
institutional
protection, 
development/capacity-building

and 

5. Improved monitoring

through  more  clearly  defined  programme  performance
indicators and sectoral policy commitments

The second significant achievement in the region in 2002 was that political
dialogue with ACP countries, provided for under Article 8 of the Cotonou
Agreement,  was  strengthened  in  a  number  of  ways.  Not  only  was  the
dialogue  itself  systematised,  becoming  an  integral  part  of  the  regular

120

For more info on CSPs and RSPs, visit:
http://www.europa.eu.int/comm/development/body/csp_rsp/csp_en.cfm

174

                                                
in-country  dialogue  and  expanded  to  cover  a  wider  range  of  issues  but
political  analysis  was  further  incorporated  into  development  programming:
the  9th  EDF  programming  exercise  allowed  the  EC  and  the  relevant  ACP
countries to discuss jointly the political situation in recipient countries, and to
include a thorough political assessment in the country’s CSP.

The EC also improved its response to ACP countries in crisis or conflict in
several  ways:  by  strengthening  dialogue  and  staying  engaged;  exerting
pressure  on  governments  without  harming  their  citizens;  reinforcing  direct
aid to communities and civil society; focusing on states where measures were
adopted  under  Cotonou  Agreement  Article  96;  and  supporting  peace
processes, or helping to disarm factions or demobilise soldiers.

2002  was  the  first  year  in  which  the  Council  Decision  to  extend  EU-OCT
association  to  2011  was  implemented;  the  EC  focused  on  establishing  new
institutional  arrangements  to  enhance  the  partnership  between  OCTs,  EU
Member  States  and  the  Commission,  and  adopting  relevant  ancillary
legislation.

The third significant achievement of EC assistance to ACP countries was the
pursuit  of  more  sustainable  poverty  reduction  strategies.  EC  budgetary
support  was  more  closely  aligned  in  2002  with  Poverty  Reduction  Support
Programmes (PRSPs), helping to reduce poverty in a variety of ways:

– 

– 

– 

– 

improved  public  finances  in  a  number  of  countries  thanks  to  better
planned  annual  budgets,  the  application  of  more  rigorous  financial
controls,  and  more  predictable  financial  flows  as  a  result  of
multiannual rather than year-by-year planning;

enhanced coordination between the EC and other donors: in Tanzania,
for  example,  joint  arrangements  were  implemented  in  2002  between
the  delegations  of  the  EU,  eight  EU  Member  States,  Switzerland  and
Norway,  thereby  harmonising  the  fund  transfer  procedures  and
programme  performance  indicators  used  by  donors,  which  in  turn
should help to lower transaction and monitoring costs;

more  accurate  assessment  of  programmes’  performance  by  means  of
joint donor reviews of public finances and PRSPs.

increased project impact: donors’ individual programmes were planned
more closely together, thereby harnessing synergies between the actors
involved;  and  the  EC  was  able  more  effectively  to  encourage
governments  to  increase  their  focus  on  poverty  reduction  and  adopt
PRSPs (as did the government of Ethiopia, for example, in 2002).

6.4.2.

Programming priorities

Most of  the  resources  in  the  draft  CSPs  reviewed  have  been  earmarked  for
actions identified as priorities in the Commission and Council Development

175

Policy Declaration (November 2000)121 and in the Cotonou Agreement, and
CSPs  approved  in  2002  by  EU  Member  States  targeted  EC  resources
principally  on  transport  and  macroeconomic  support  for  poverty  reduction
strategies.

Country programming priorities in ACP countries:
development sectors’ ranking in CSPs completed to end 2002

Ranking

Development sector

% of total planned assistance to ACP

27

3

30

Transport

developing sector strategy

maintaining & upgrading roads

sub-Saharan Africa

other ACP

capacity-building

managing core networks

Macro-economic support
Poverty reduction
Institutional support
Capacity-building
Education
Health
Food security
Rural development
Water supply
Sanitation

total

23

11

9

9

7

1

2

3

4

5

6

Similarly, as the table below shows, Regional Strategy Papers and Regional
Indicative  Programmes  (RIPs)  allocated  assistance  in  2002  to  sectors
considered as top priorities by the Commission.

Regional programming priorities in ACP countries:
priority development sectors in RIPs completed in 2002122

Priority sector
economic integration and trade
transport and communications
natural resources management
human resources development
fisheries

1
2
3
4
5

% share of funds allocated by ACP RIPs
57.0
31.0
9.3
1.3
0.8

Special  efforts  were  also  made  to  engage  with  partners  and  set  priorities
through regional programming. Under the Lomé Conventions, programming
was mainly with governments from groups of ACP states. But since the 2000
Cotonou  Agreement,  it  has  been  prepared  with  mandated  regional  bodies.
The table below shows, for each of the ACP’s six sub-regions, the share of
transport  and
RIP  funds  allocated 
communications, the top two priority sectors in most ACP sub-regions.

integration  and 

to  economic 

to 

121

122

For the full text of the Declaration, visit
http://register.consilium.eu.int/pdf/en/00/st13/13458en0.pdf
Priority development sectors as defined by the OECD’s Development Assistance Committee

176

                                                
Key programming priorities in ACP countries:
RSPs and RIPs completed, 2002

Region

Mandated regional
bodies (MRBs)

MRB
acronym

Allocations
(€ million)

% share

Econ.
integ.
123

Trans.,
Comms

Caribb.

Caribbean Community

CARIFORUM

Pacific

Pacific Islands Forum

PIF

57.0

29.0

75-90

31

14-18124
31125

West
Africa

Economic Community of

West African States

Economic & Monetary

Union of West Africa

ECOWAS

UEMOA

235.0

50

35126

Central
Africa

Economic & Monetary
Community of C. Africa

CEMAC

55.0

25-30

35-40

E. & S.
Africa,
Indian
Ocean

Common Market of East

& Southern Africa

COMESA

East Africa Community

EAC

Inter-Governmental Auth.

on Development

Indian Ocean
Commission

IGAD

IOC

223.0

45-55

15-25127

South
Africa

Southern African
Development Community

SADC

101.0

40

35-45

For  OCTs,  furthermore,  the  9th  EDF  programming  framework  was
completed  in  2002  by  the  adoption  of  Commission  Regulation  2304/2002,
supplemented  shortly  afterwards  by  operational  guidelines,  on  the  basis  of
which OCTs are expected to submit their single programming documents by
the end of December 2003.

123

124

125

126

127

Includes  ICT  development  and  the  implementation  of  CSME’s  transport  provisions:  policy
development, harmonisation of regulations and air and maritime transport procedures.
Share  of  RIP  devoted  to  the  fight  against  major  vulnerabilities  (drugs  control  and  disaster
management) and policy dialogue and programme review.
Share  of  RIP  funds  devoted 
communications
West Africa: harmonisation of transport policies and legislation
E.  and  S.  Africa,  Indian  Ocean:  2nd  priority  sector  -  natural  resource  management  –  was
allocated 25%

to  human  resource  development,  not 

transport  and

177

                                                
Roads vs. food? Addressing structural problems in ACP countries

Why  does  the  Commission  devote  development  money  to,  say,  road-building  in  the
least developed countries, many of which are in the ACP region, when pressing needs,
such  as  feeding  people  struck  by  drought,  still  require  immediate  attention?  EC  aid
should be – and is - used to alleviate human suffering: see the ‘Food security’ and other
sub-sections below. But the EC is also committed to addressing the root causes of such
suffering, and transport and other projects can help by:

stimulating economic growth:

linking agricultural and industrial production centres with markets

creating import-export corridors for coastal and land-locked states

generating much-needed incomes through construction-related jobs; and

improving access, particularly in rural areas, to:

job opportunities in cities and towns

hospitals, clinics, training and education centres and other social services

6.4.3 Main Results in 2002

6.4.3.1 Country Strategies

While  reporting  2002  CSP  results  here  would  be  premature  -  since
programming  for  many  CSPs  continued  to  the  end  of  2002  -  annual
operational  reviews  in  ACP  countries,  as  required  by  the  Cotonou
Agreement, did occur for the first time in 2002. Based on 2001 joint annual
reports  prepared  by  each  country’s  Head  of  EU  Delegation  and  National
Authorising Officer (NAO), these reviews were conducted in four key steps
(preparation  in  the  country  of  a  draft  joint  annual  report,  country  team
meeting, in-country review, and completion of a final joint annual report).

They  also allowed National Indicative Programmes (NIPs) to be  updated in
line with developments in the country, and set specific priorities, including:

– 

– 

– 

refining the indicators to be used in implementing the 9th EDF as per
the intervention framework;

assessing the CSP programming and dialogue processes to date; and

where  appropriate, 
strengthening.

formulating  concrete  proposals 

for 

further

6.4.3.2 Implementation

The EC’s external assistance to ACP countries exceeded its targets in terms
both of spending commitments and of payments made in 2002, as the table
below shows.

178

Implementation of external assistance to ACP countries:
total net commitments and payments, 2002

Source

Commitments (€
million)

Payments (€ million)

2002

2001

2002

2001

Target Actual

Actual Target Actual

Actual

European Development Funds (EDF)

EC Budget

Total

2 000.0

1
1
554.0
768.4
606.0 502.0

2
374.4

2
056.0

1 850.0

70.0,
2 068.0
568.0

2 636.0

1
902.5
640.0

2
542.5

– 

Conflict Prevention, Good Governance and the Rule of Law

A  number  of  projects  were  supported  through  the  EC’s  Rapid  Reaction
Mechanism, which fast-tracks funds to where they’re most urgently needed,
and had a total 2002 budget of over €27 million allocated to ACP countries.
Examples  were  the  peace-keeping  operations  conducted  along  the  border
between Eritrea and Somalia and the start of the formal border demarcation
work involving officials from both countries. In Somalia, the latest round of
peace  talks  was  launched,  with  neighbouring  countries  included  though  the
Inter-Governmental Authority for Development (IGAD).

In addition to intervening in precarious situations requiring quick responses,
the EC was also active in 2002 in projects to promote good governance and
the  rule  of  law.  EU  missions  were  dispatched  to  Congo,  Jamaica,  Kenya,
Madagascar  and  Sierra  Leone.  A  Commission  for  Truth  and  Reconciliation
was established in Sierra Leone.

The rule of law in Rwanda:

citizen-based justice and the European Initiative for Democracy and Human Rights (EIDHR)

By  the  end  of  2001,  fewer  than  7  000  of  the  more  than  115  000  suspects  awaiting  trial
following Rwanda’s genocide in 1994 had appeared in court.

To reduce this backlog, the country is now using traditional, citizen-based tribunals known as
gacaca (‘ga-CHA-cha’) to try all but the most serious cases. Legally established bodies, their
judges can impose sentences up to life imprisonment.

So  far,  local  communities  have  selected  over  250  000  magistrates  for  more  than  10  000
tribunals.  The  EIDHR  was  actively  engaged  in  the  process  in  2002,  helping  the  Rwandan
Supreme Court to ensure the application of internationally-recognised legal norms.

– 

Institution-Building and Private Sector Development

While well-managed, adequately-resourced public institutions are essential to
achieving political stability, a flourishing private sector can equally help spur
economic  growth  and  thereby  reduce  extreme  poverty.  The  fragility  of  so
many  ACP  countries  in  2002  lent  added  impetus  to  the  EC’s  institution-

179

building  efforts  in  both  public  and  private  sectors,  leading  to  greater
transparency  and  better  planning  with  a  view  to  strengthening  the  public
sector.

Below are typical examples of programmes completed in 2002.

Public-sector institution-building in ACP countries:
Selected results, 2002

Country

Central African Rep.,
Haiti, Sierra Leone

Result

€ million

national census completed

better-targeted planning now possible

34 police stations constructed

(committed) 9.0

South Africa (Eastern
Cape)

vehicles maintained and repaired

11.0

police-community relations reinforced

In  addition  to  its  public  sector  support,  the  EC  continued  to  expand  its
programmes targeting private firms in 2002. Such programmes include:

– 

– 

– 

– 

PRO€INVEST,  a  seven-year  €110  million  project  intended  to
promote  private-sector 
in  ACP
countries (see table below);

investment  opportunities 

EBAS,  a  matching  grant  scheme,  providing  assistance  to  SMEs
and amounting to €31 million between 1999 and 2003;

ESIP,  an  €18  million  investment  promotion  programme  in
Southern Africa; and

schemes  in  the  Caribbean  to  improve  the  rum  industry’s
competitiveness,  support  the  Caribbean  Export  Development
Agency, and promote sustainable tourism.

Private-sector institution-building in ACP countries
selected results, 2002

Region

Result

55 
states

West
Africa

ACP

know-how shared by consultants with businesses

funds committed to over 850 projects

Agro-Ind  2002  investment  promotion  meeting,  Dakar,
Senegal (part of PRO€INVEST)

attended by over 75 EU & 120 African firms

100 letters of intent signed

well-publicised, well-organised networking event

achieved 75% participant satisfaction rating

€ million

(committed)
19.0

9.0

180

– 

Regional Cooperation and Integration, including Regional Programmes

Regional integration and cooperation in Europe over the last fifty years have
undoubtedly  helped  to  ensure  enduring  peace,  increased  prosperity,  and
greater  freedom  to  trade  in  goods  and  services,  invest,  work  and  study
abroad.  As  a  key  player  in  such  integration  efforts,  the  Commission  is
determined  to  help  deliver  similar  benefits  to  ACP  countries  through  its
assistance.

In  line  with  this  thinking,  in  2002  the  Commission  actively  supported  a
whole  host  of  regional  groupings  within  Africa,  the  Caribbean  and  the
Pacific  (see  ‘Programming  Priorities’  above).  What  form  did  this  support
take? Was  there  a positive impact? And  were  there  difficulties  encountered
or  lessons  to  be  learned  in  delivering  such  aid?  An  analysis  of  one  typical,
€94  million  programme,  supporting  the  West  African  Economic  and
Monetary  Union  (UEMOA,  acronym  of  the  French  Union  économique  et
monétaire ouest africaine) offers some potential answers.

legislation 

In  2002,  the  EC’s  support  was  targeted  primarily  at  UEMOA  efforts  to
harmonise 
coordinate
macroeconomic  policies;  improve  the  quality  of  national  and  regional
statistics gathering; and enhance private firms’ competitiveness. The positive
results  of  these  efforts  in  2002,  notably  in  statistics  collation  and  private
sector support, are summarised below.

common  market; 

create 

to 

a 

Regional cooperation and integration in ACP countries:
results of UEMOA, 2002

common competition policy and other common market legislation adopted

surveillance mechanism regularly applied

Member States now able to use measures to:

compare economic performance more accurately
craft more effective integration policies

private-sector product quality assurance and accreditation schemes introduced

However, the EC’s assistance to the UEMOA in  2002 did experience some
difficulties, primarily because of both parties’ limited ability to disburse the
considerable sums of money for which they were responsible: the UEMOA
lacks  many  of  the  administrative  resources  –  people,  IT  and  technical
expertise - required to undertake  major  reforms,  and  both  the  EC’s  and  the
UEMOA’s  procedures  for  getting  assistance  money  to  where  it  is  intended
are prohibitively complex.

The  Commission  recognises  that  it  is  as  much  the  donor’s  as  it  is  the
recipient’s responsibility to tackle such problems. To this end, its support in
2003 will aim to bolster the UEMOA’s administrative capacity and simplify
its own financing procedures to allow faster release of funds.

181

– 

Transport, Infrastructure and Energy

Transport and infrastructure are two further development areas prioritised by
the  EU,  and  in  which  much  of  its  external  assistance  to  ACP  states  was
concentrated in 2002. More than 275 EC-funded projects were underway in
2002 in ACP countries, many with a regional dimension.

Most  of  the  infrastructure  programmes  in  ACP  countries  in  2002  were
focused  on  transport  (for  a  sample  see  below).  As  well  as  funding  the
construction  and  upgrading  of  transport  links,  the  EDF  also  contributed
institutional  support  to  the  road  sector  in  2002.  For  example,  in  Rwanda,
Senegal and Sierra  Leone, the EDF financed the  creation  of  National  Road
Boards  charged  with  managing  the  maintenance  and  expansion  of  each
country’s road network.

Transport, infrastructure and energy in ACP countries:
Typical projects, 2002

Country

Project

EDF funds (€ million)

Ethiopia

Jamaica

Coast-to-interior routes

Northern Coastal Highway upgrading

Kenya, Tanzania,
Uganda

Parts  of  the  East  African  northern  and
central corridor

Papua New Guinea Ramu Highway upgraded

Rwanda

Gitarama-Kibuye road completed

Over 325

80.0

Over 265

24.0

41.0

transport.  Through  other 

infrastructure  projects  were  not  solely
However,  EDF-funded  ACP 
concerned  with 
infrastructure  programmes
completed  in  2002  the  EC  was  also  able  to  help  partner  countries  improve
their management of scarce water and mineral resources and  reduce mining
communities’  reliance  on  the  extraction  of  finite  mineral  supplies  by
diversifying into other areas of economic activity.

Natural resource management in ACP countries:
Projects, 2002

Country / region

Project

Water

Africa – 45 states weather satellite ground station programme
Ghana

water supply installed in rural regions

Botswana

Niger

modernisation of techniques, environmental
remediation and diversification of labour
uranium mines modernised

Minerals

EDF funds
(€ million)

11.0
56.0

30.0

35.0

182

– 

Food Security and Rural Development

The  humanitarian  situation  across  Southern  Africa,  and  in  Ethiopia  and
Eritrea, already fragile at the start of 2002, was further aggravated during the
year  by  a  severe  drought  and  rising  poverty  due  to  price  increases;
inadequate government food security policies; and the continuing devastation
wrought by the HIV/AIDS pandemic. In response, the EC funded substantial
food  security  programmes  and  emergency  interventions  to  help  avert
looming humanitarian crises in both regions.

Food aid supplied to ACP countries:
EC response to food crises in Africa, summary 2002

Crisis region

Horn of Africa

Southern Africa

Countries worst affected

Eritrea
Ethiopia

Lesotho
Malawi
Mozambique

Aid supplied

Metric
tons 000

Total funds

€ million

Food
Seed,
fertiliser

412

4

110.0

Swaziland
Zambia
Zimbabwe
227

5

117.6

In both regions, the EC also successfully coordinated the delivery of food aid
with a number of partners (the UN World Food Programme and other NGOs,
governments of recipient countries) and targeted aid to the poorest and most
vulnerable  groups  affected,  including  HIV/AIDS  victims  and  internally
displaced people and refugees from neighbouring states.

While emergency relief is crucial to saving lives, both recipient governments
and  the  Commission  agree  that  such  aid  is  unlikely  to  improve  the  longer-
term prospects for food security, and more still needs to be done to tackle the
underlying,  structural  problems.  Much  of  the  EC’s  assistance  in  2002  was
therefore designed to address these root causes.

Food security in ACP countries:
longer-term assistance, 2002128

Region

E. & S. Africa, Indian
Ocean

Country

Eritrea
Ethiopia
Malawi
Mozambiq
ue

Type of assistance given

technical support, safety net
technical support, safety net
technical support, safety net
multi-component

€ million
16.0
60.0
42.0
60.0

W., C., E. & Southern Africa

veterinary, to control disease

72.0

Rural  development  constituted  a  further  element  of  the  EC’s  longer-term
strategy  in  ACP  countries  to  improve  food  security  and  reduce  poverty.
Projects  completed  in  2002  included  biodiversity  preservation  in  Tanzania
and Gabon; fisheries research to protect Nile perch stocks in Lake Victoria,
and desertification control in Mali (see below).

128

Ongoing programmes approved since 1999

183

                                                
Rural development in Mali:
anti-desertification programme, results to end 2002

area covered by dunes now stabilised
several species of flora and fauna re-introduced
local communities’ incomes raised through the sale of fuel wood and timber
effectiveness of locally-managed eco-conservation projects reaffirmed

Rural development in Madagascar:
supporting vanilla farmers, from plantation to supermarket

A comprehensive series of assistance projects, running from 1997 to 2002 and totalling
over €5  million, has resulted in vanilla production and export becoming once  again  a
pillar of the Malagasy economy in 2002.

Previously the world’s leading exporter of vanilla, Madagascar had over the course of
the  1980s  and  early  1990s  lost  its  competitive  edge,  with  a  corresponding  slump  in
export  earnings.  So  an  EC-funded  programme,  started  in  1998,  assists  not  just
growers, but the entire supply chain – from processors to distributors and exporters.

The  programme  has  helped  transform  the  fortunes  of  the  Malagasy  vanilla  industry
from  its  nadir  in  the  mid-1990s,  with  significant  benefits  for  vanilla-producing
communities and the economic performance of the country as a whole

Rural development in Madagascar:
vanilla exports programme, results to end 2002

Results

over 2 000 hectares of productive land added
 expansion evenly distributed across over 120 villages
 thousands of quality production manuals distributed
 standards monitored by 120 production observers
 guidance given to growers about ideal harvesting periods
labels of national origin established
 quality ‘Vanilla from Madagascar’ marks introduced
 over 40-fold rise in prepared vanilla export earnings, 1996-2002
 over 100% rise in vanilla’s share of Malagasy export earnings, 1999-
2002129

Area

Land
Distribution

Quality

Earnings

– 

Health

Addressing health issues in ACP countries is key to the EC’s overall external
assistance strategy. Health constitutes the focal area for three of the UN’s six
Millennium  Development  Goals,130  and,  together  with  the  delivery  of  other
social services, one of the EC’s six priority development areas.

New  strategies  were  developed  in  2002,  entailing  a  shift  from  project-
specific  funding  towards  sector-wide  approach  programmes,  a  closer  link
between budget support and outcomes in social sectors such as health and a
deeper  ‘sector  dialogue’  with  national  authorities,  local  partners  and  other
donors.  Pre-requisites  for  a  sector-wide  approach  (‘SWAP’)  comprise
government  action  to  devise  an  integrated,  national  strategy  for  addressing

129

130

Vanilla as % of total Malagasy export earnings: 11 (1999), 26 (2002)
For more information on the EU’s commitment to the UN’s Millennium Development Goads,
see ‘Strategic Goals and Achievements’ above

184

                                                
health issues, issue a programme of work and spending plan, implement the
strategy,  and  coordinate  between  the  EC,  other  donors  and  stakeholders  in
the sector.

Sector-wide support continued to be provided in 2002 to several states where
the  EC  also  provided  central  budgetary  support,  including  Ghana,  Zambia,
Senegal,  and  Cameroon,  where  such  an  approach  has  already  been  fully
adopted.  The  results  of  such  support  were  broadly  positive,  notably  in
Ghana,  which  was  the  first  ACP  country  to  adopt  a  SWAP  in  the  health
sector, and one of the very few on track to attain its health MDGs.

Health in Ghana:
selected key indicators to end 2002

Result

Measure

Previous

Latest

infant mortality: reduced
measles immunisation: widened
supervised births: increased

Deaths/1000
% of total population
% of all births

1993
1997
1996

66 1998
57 2001
38 2000

57
82
52

In  other  states  like  Uganda  and  Tanzania,  successful  SWAPs  exist  but  EC
health sector  funding  was  only  for  small,  health-specific  projects.  But,  as  a
significant central budgetary support donor, the EC still contributed to sector
dialogue. And in yet other ACP countries that do not yet fulfil conditions for
a SWAP – Mali, for example, or Mozambique - EC support was implemented
under an evolving scenario, paving the way for a future SWAP, including the
development by donors of common management arrangements and ‘basket’
funding (pooled to buy medicines, for instance).

The  EC  continued  to  fund  specific  health-related  projects  in  states  whose
precarious  political  context  has  precluded  a  shift  in  approach  by  the
government  and/or  donors:  in  Niger,  for  instance,  the  EC  committed
€2 million  for  a  blood  safety  project  while  in  the  Caribbean,  EC  drug
demand  reduction  projects  totalled  over  €1.8  million.  Implementation  also
continued  of  over  100  projects  -  covering  40  ACP  countries  and  totalling
over  €1 billion  -  funded by  EC  commitments  made  before  2002,  while  two
commitments  were  made  in  2002  targeting  multi-country  health  issues  (see
table below).

Health in ACP countries:
commitments to global programmes, 2002131

Country

Programme

All ACP states Global Fund to Fight AIDS, TB & Malaria132
Sexual & Reproductive Health (UNFPA/IPFF133)
21 ACP states

€ million
60.0
32.0

EC  funds  in  several  ACP  countries  raised  or  underpinned  government
spending  on  health,  involving  closer  liaison  between  EU  macro-economic
and  health  specialists.  Budgetary  support  also  included  a  capacity-building

131

132

133

Funds committed in 2002 (but still to be paid) from the 9th European Development Fund
Fund established at the meeting of G8 countries in Genoa in July 2001
UNFPA: United Nations Family Planning Agency
IPFF: International Planned Parenthood Federation

185

                                                
component,  thereby  increasing  governments’  ability  to  deliver  healthcare,
and  allowing  EC  involvement  in  health-sector  dialogue  in  the  country
concerned.

Health in ACP countries:
capacity-building assistance, 2002

governments & civil servants helped to plan national & regional health policies
public finance management improved to increase health spending efficiency
information systems strengthened, quality of performance indicator data raised

Health in Southern Africa:
Soul City – addressing the challenge of HIV/AIDS

As it has since 1993, the EC continued in 2002 to help fund Soul City, a South African
NGO  using  the  mass  media  to  tackle  both  the  threat  posed  by  HIV/AIDS,  and  other
health,  social  and  development  issues.  Its  radio  and  TV  ‘edutainment’  programmes
inform  while  entertaining  audiences  throughout  the  country,  across  all  social  strata.
Building  on  its  success  to  date,  the  EC  committed  in  2002  to  funding  Soul  City’s
expansion into eight neighbouring countries

Health in Southern Africa:
Soul City HIV/AIDS programming, results to end 2002

programming seen/heard by over 50% of total SA TV & radio audience
6 radio & TV soap operas developed for adults, and Soul Buddyz series for children
€10 million additional EC funds committed in 2002 to fund expansion into
Botswana, Lesotho, Malawi, Mozambique, Namibia, Swaziland, Zambia & Zimbabwe

co-donors (UK, Irish & Dutch development offices) closely consulted by EC

– 

Education and culture

Like  health,  education  assistance  was  a  priority  sector  for  EC  assistance  to
ACP  countries  in  2002,  comprising  one  of  the  UN’s  six  Millennium
Development Goals (MDGs), and one of the EC’s six priority development
sectors. And much as in health, in education the Commission sought in 2002
to  shift  funding  away  from  a  project-specific  basis  to  a  more  integrated
approach  involving  closer  partnership  with  recipient  countries.  Solid
progress was made in ACP countries such as Tanzania and Namibia in 2002
in  shifting  assistance  from  project-specific  support  towards  a  sector-wide
approach.

However, in several other ACP countries such a shift has yet to be initiated,
for similar reasons as in the health sector. So assistance in 2002 continued to
be  largely  project-specific.  For  example,  in  Botswana,  Ethiopia,  Fiji  and
Papua New Guinea, commitments amounting to over €15 million were made
to upgrade primary schools and university facilities.

In  addition,  funding  in  2002  to  boost  or  underpin  central  budget  education
spending  comprised  a  greater-than-ever  share  of  EC  education  support  in
ACP  states.  The  cases  of  the  Comores  and  Ethiopia  typify  the  EC’s
commitment  to  capacity-building,  making  the  planning  of  integrated,
national education strategies now possible. Delivery will be ensured through
the  vocational  training  of  officials,  both  in  government  education  and
training agencies, and in partner organisations such as business associations,

186

local NGOs & churches. And the training is to be given in a broad range of
essential 
resource  development,  business
including  human 
management and public administration.

skills, 

Education in Niger:
boosting the economy through training

Launched in 2000 with a budget of €7 million, an EC-funded, 3.5 year vocational and
technical  training  programme  in  Niger  sought  to  address  directly  Niger’s  labour
market  training  needs,  through  the  creation  of  a  national  system  of  continuing
vocational  training.  Following  a  raft  of  positive  results  up  to  the  end  of  2002,  the
project was prolonged in 2002 for a further 1.5 years.

Education in Niger:
national vocational training programme, results to end 2002

National Office of Vocational Training established
Nigetech training certificate introduced – now often requested by employers
training tailored to requests from, & costs shared with, business organisations
training offered through regional centres, allowing nation-wide reach
craftsmen’s skills improved & small businesses’ competitiveness increased
an evaluation conducted in 2002 pointed to the programme’s:

significant contribution to developing Niger’s skills base
potential as a model for vocational training provision in developing states

–  Macroeconomic Policies

Macroeconomic support comprises perhaps the greatest share of EC external
assistance to ACP countries. From 1992 to the end of 2002, such support had
amounted  to  over  €3  billion.  In  2002  alone,  EC  macroeconomic  support
came to over €600 million. Around 30 countries had EC-funded programmes
in  operation,  and  for  the  first  time,  the  total  number  of  such  programmes
exceeded 40.

The Commission’s approach to macroeconomic support  evolved  in  2002  in
two main directions. First, it promoted a stable overall economic framework
together with other donors, and including interest and inflation rates, balance
of payments and budget deficits, thereby helping to reduce budget deficits in
some  ACP  countries  in  2002  by  more  than  50%  (Burkina  Faso  and
Madagascar; see table below).

Second, the Commission  targeted  poverty  reduction  through  support  in  key
policy  areas,  and  by  further  linking  budgetary  support  more  closely  to  the
provision  of  health,  education  and  other  social  services,  a  real  shift  in  the
EC’s  macroeconomic  assistance  was  consolidated  in  2002.  For  instance,  to
help increase consideration for social sectors in ACP financing proposals for
EC  support,  the  Commission  decided  in  2002  to  send  both  macroeconomic
and  social  sector  team  representatives  to  assistance  talks  with  Ethiopia,
Ghana, Madagascar, Mozambique, Niger and Zambia.

187

Macroeconomic policies in Burkina Faso & Madagascar:
budget deficit reduction, results in 2002

Country

2002 total budget deficit (€ million)

Burkina Faso134
Madagascar135

before donor support
377.9
1514.3

after donor support
165.7
686.7

Deficit
reduced by
56.1%
54.7%

The  Commission  was  able  in  2002  to  fully  implement  its  macroeconomic
assistance in countries such as Burkina Faso, Zambia, and Tanzania, where
public  finance  management  was  improved,  Poverty  Reduction  Strategies
were adopted and progress reflected in health, education and other indicators.
Economic  reform  programmes  in  these  countries  stayed  on  track,  as
confirmed by the IMF. In states such as Burundi, Gambia, Sierra Leone and
Zambia, ‘sleeping’ or suspended macroeconomic cooperation was revived, in
part because governments were more open to dialogue with the EU.

Support  was  temporarily  suspended  where  the  Commission  had  concerns
about  Government  stalling  caused  by  weak  public  finance  management
(Senegal,  Malawi  and  Gabon),  major  delays  in  implementing  economic
reforms (Malawi), insufficient government commitment to poverty reduction
or  data  reliability  (Ghana  and  Cameroon)  because  of  under-resourced  or
badly-trained staff in national statistical services, inadequately analysed data
making meaningful measurements of progress impossible, or data hidden or
distorted  in  the  interests  of  broader  domestic  political  imperatives.  For
example,  it  proved  impossible  to  launch  an  €11  million  poverty  reduction
programme  in  Guinea  because  of  EU  Member  States’  concerns  about
opposition parties’ freedom to campaign before the general elections in June
2002.

– 

The environment and water resources

The  results  of  EC  environmental  and  water  projects  in  2002  were,  as
elsewhere,  mixed.  Two  of  the  EC’s  flagship  environmental  assistance
programmes — ECOFAC and ECOPAS — are in Africa, and both achieved
progress  in  2002:  a  2002  project  evaluation  of  the  EC’s  €23  million
ECOFAC  programme,  which  aims  to  protect  the  rainforest  of  the  Congo
Basin, noted its successes to date, not least in preserving bio-diversity despite
local  communities’  often  competing  needs.  For  results  of  the  EC’s
€20 million ECOPAS project in West Africa, see the box below.

134

135

Source: IMF, cited in EC Financing Proposal for Budgetary Support Programme, Mar. 2002.
Original figures in CFA Francs BCEAO, converted into euros using rate as at 24 Apr. 2003.
Source: IMF, cited in EC Financing Proposal for Emergency Budgetary Support Programme,
Oct. 2002.
Original figures in US Dollars, converted into euros using rate as at 24 Apr. 2003

188

                                                
Environment and water in West Africa:
working with local communities to generate incomes and protect diversity

“Thanks to EC funding, ECOPAS was able to continue its work with local communities
across West Africa in 2002, helping to preserve  the  region’s  priceless  bio-diversity  for
generations to come.”

Alioune S. Aladji-Boni
Regional Coordinator, ECOPAS Programme
Ouagadougou, Burkina Faso

Established  in  2001,  in  a  50  000  km2  park  bordering  the  River  Niger  as  it  flows
through  Benin,  Burkina  Faso  and  Niger,  the  EC-funded  €20  million  ECOPAS136
in  2002  to  promote  regional
environmental  protection  programme  helped 
cooperation, develop eco-tourism and fund vital conservation work.

Environment and water in West Africa:
ECOPAS Environmental Protection Programme, results in 2002

Regional cooperation
park twinned with national parks in France and Italy (Ardèche, River Po)
first joint meeting held between:
- national parks ministers from Benin, Burkina Faso & Niger, and
- the Environment Commissioner of the UEMOA137
Sustainable tourism
calls for tender issued overseas for potentially-lucrative hunting franchises
eco-tourism projects launched to exploit giraffe and manatee populations
partnerships established with local and overseas private-sector tour firms
Environmental education
1 500 local schoolchildren offered eco-education & park tours
joint research programmes established between local and overseas universities
Nature conservation
over 90 park staff trained in animal tracking & anti-poaching techniques
over 10 new animal species identified
over 100 prehistoric & archaeological sites discovered
illegal poaching within the park cut by over 45% since programme launch

In the Caribbean and Pacific regions, two significant water projects were completed:

Environment and water in the Caribbean and Pacific:
selected programmes completed, 2002

Country
Jamaica
Samoa

Project

€ million

Negril-Ocho Rios: sewage treatment for 40 000
 water supply to 50 000 in rural areas

40.0
18.0

However, evaluations in 2002 of other environment projects gave cause for concern:
In  Botswana,  a  €2.0  million  community  forestry  programme  had  to  be  closed
primarily because of limited national commitment to the project; and a review of the

136

137

ECOPAS: acronym of the French Ecosystèmes protégés en Afrique sahélienne (Protected Ecosystems
in North-West Africa)
UEMOA:  acronym  of  the  French  Union  économique  et  monétaire  ouest-africaine  (West  African
Economic and Monetary Union)

189

                                                
€23 million AGIR138 integrated natural resource management programme in Guinea,
Guinea-Bissau, Senegal and Mali, found poor internal coordination. As a result, the
project’s  internal  structure  has  been  revised  and  the  technical  assistance  team  has
been partially relocated and its terms of reference amended.

– 

Science and Technology

EU-ACP  scientific  and  technological  cooperation  was  mostly  centred  in  2002  on
sub-Saharan countries, since Caribbean and Pacific states have more limited research
capabilities  than  many  of  their  African  counterparts.  Such  cooperation  in  2002
comprised several strands.

Science and technology in Africa:
approximate shares of external assistance funding for research, 2002

Country/region

EU
EU Member States acting bilaterally
US
Japan, other Asian countries
Canada
Other

% of total assistance

60

25
5
4
6

A  Science  and  Technology  for  Development  programme  established  in  1983  and
revised  to  reflect  commitments  made  by  the  Union  at  the  Earth  Summit  in  Rio  in
1992 continued its work.

investments  were  made 

Further 
the  European  Development  Fund,
through 
developing  African  countries’  research  capacity  through  regionally-based  research
organisations. Such investments are highly valued by both the political and scientific
communities  in  ACP  countries,  since  they  allow  research  to  be  conducted  that  is
directly relevant to development issues and participatory in ways distinct from other
bilateral  or  international  approaches.  Initiatives  addressing  issues  such  as  poverty-
related disease  have already been launched, and  future research is likely to  address
subjects  including:  food  security;  the  sustainable  use  of  natural  resources  such  as
water; soils and bio-diversity; and good governance and conflict prevention.

Despite  previously  negligible  levels  of  scientific  and  technological  cooperation
between  African  countries,  considerable  progress  has  been  made  in  recent  years  in
developing regional or sub-regional research initiatives, and such progress continued
in 2002. The regional  approach  adopted by the  Fifth Framework Programme  (FP5)
and  subsequent  activity  planned  for  the  Sixth  Framework  Programme  (FP6)
continued  to  act  in  2002  as  catalysts  for  the  emergence  of  scientific  thematic
networks in West, Central, Eastern and Southern Africa.

These  should  in  turn  lead  to  regional  integration  of  agricultural  research  and
enhanced  research  cooperation  with  the  EU.  In  agriculture,  as  in  other  sectors  of
special  importance  to  ACP  countries,  scientific  and  technological  cooperation
guarantees  that  research  into  relevant  development  issues  is  mainstreamed  at  the
international level, and African countries’ research capacity is maintained.

138

AGIR: acronym of the French Appui à la Gestion intégrée des Ressources naturelles (Natural Resource
Management Support)

190

                                                
A joint ACP-EU science and technology task force, established in September 2001,
produced  a  draft  discussion  document  entitled  A  Shared  Vision  on  Research  for
Sustainable  Development.  It  stresses  the  importance  of:  ACP-EU  partnerships  in
improving  access  to  economic,  socio-political  and  technical  knowledge,  which  is
essential to sustainable development; policy commitment; stakeholder participation;
research  and  development  (R&D)  investment;  effective  interfaces  between  the
producers  and  users  of  such  knowledge;  effective  management  of  IPRs;  and
strengthening both human and institutional resources.

Shared  Vision  also  prioritises  seven  fields  for  research:  health,  education  and
capacity-building,  environment,  agriculture,  energy  and  transport,  information  and
communication technologies (ICT), and sustainable trade. It calls for resources from
the FP6, 9th EDF, and various bilateral sources to be used to fund such partnerships.

The document was discussed at the first ACP-EU Forum on Research for Sustainable
Development,  held  in  Cape  Town  in  July,  which  resulted  in  the  publication  of  the
ACP  Cape  Town  Declaration  on  Research  for  Sustainable  Development,  and  an
accompanying Plan of Action.139 In the Declaration, ACP states pledged gradually to
increase  budgetary  allocations  for  research,  development  and 
technological
dissemination  and  innovation  to  a  minimum  of  1%  of  GDP  within  10  years,  and
recognised the need for greater ACP-wide coordination.

These documents subsequently provided much of the basis for ACP countries’ input
at  the  World  Summit  on  Sustainable  Development,  held  in  Johannesburg  in
September.

– 

Partnership with Civil Society and NGOs

The EC was not only involved in 2002 in delivering assistance itself to countries in
ACP countries; it also encouraged close partnership with EU and ACP civil society
groups and non-state actors to identify and implement projects.

The  Commission  is  conscious  that  in  many  ACP  countries,  NGOs  are  often  better
placed  than  it  is  to  leverage  in-the-field  experience  and  develop  innovative
approaches to development issues at community level. Accordingly it was committed
in  2002  to  enabling  non-state  partners  to  implement  EC-funded  projects  in  ACP
states  and  empowering  them  to  initiate  and  design  programmes  themselves,  in
partnership with local NGOs in ACP countries, using EC funds.

Two  such  projects  that  were  completed  in  2002  highlight  the  way  in  which  EC
assistance  funds  were  increasingly  used  to  mainstream  issues  such  as  gender
equality.

139

For the texts of the Declaration and the Action Plan, visit http://www.acpsec.org/capetown/capetown-
en.pdf

191

                                                
Partnership with civil society and NGOs in ACP countries:
selected results to end 2002

Project
country

Lead NGOs’ origin
ACP

EU

Côte
d’Ivoire

Italy
France

South
Africa

France

Côte
d’Ivoire

South
Africa

Project results

€ million

technical training centre built in
Abidjan and fully equipped

focus on women without education

funds used to train business trainers
rural micro-credit schemes funded

0.5

0.4

NGOs also became more aware in 2002  of  the  importance  the  Commission
attaches  to  them  in  designing  and  implementing  its  external  assistance,
thanks largely to increased publicity efforts by the EC and the wider Internet
access available to ACP-based NGOs. There was a concomitant 57% rise in
project requests received from NGOs (2001-2002).140

As  in  other  sectors,  2002  also  underlined  the  challenges  that  such  projects
continue to face: in many countries, the local organisations with whom such
projects are best carried out lacked the means to deliver projects effectively,
or  simply  did  not  exist,  while  partnerships  between  European  and  local
NGOs  were  often  tipped  in  the  former’s  favour,  limiting  local  NGOs’
involvement  in  project  design  or  implementation.  In  supporting  such
projects, therefore, he EC will need to work hard to address shortfalls in local
capacity and imbalances between European and local NGO involvement.

- Linking Relief, Rehabilitation and Development (LRRD)

In line with other donors,  the  EC  is  striving  to  link  the  relief  of  immediate
suffering  with  longer-term  rehabilitation  and  development  objectives.  An
example  of  such  efforts  was  its  response  in  2002  to  the  food  and
humanitarian  crisis  that  plagued  Southern  Africa  (see  ‘Food  security…’
above).

Linking relief, rehabilitation and development in ACP countries:
improvements to crisis response in Africa, 2002

cooperation enhanced with external actors, including EU Member States, other donors and
UN agencies

internal coordination improved between Brussels and EU delegations
special financial instruments, designed to respond to crises fast, used more often
external food security experts hired in Mozambique, Zimbabwe and Malawi

But  EC  funds  were  also  focused  on  linking  short-term  interventions  with
longer-term solutions, as the examples outlined below and elsewhere in this
chapter demonstrate.

140

Total number of requests for NGO-led projects received by the EC: 280 (2001), 440 (2002)

192

                                                
Linking relief, rehabilitation and development in Rwanda:
community-based infrastructure projects

In 1998 the EC launched several community-based programmes in Rwanda, linking emergency
relief with longer-term rehabilitation following the country’s 1994 genocide.

In  the  short  term,  the  programmes  help  communities  —  who  identify  their  own  needs  and
contribute 25% of the project costs themselves — to reconstruct (or often simply construct from
scratch)  schools,  health  clinics,  bridges,  markets  and  other  buildings.  In  so  doing,  they  help
realise  the  longer–term  goal  of  national  reconstruction  and  reconciliation,  as  communities  are
brought together to achieve a common aim.

By  the  end  of  2002,  over  1  000  project  requests  had  been  received  by  the  Commission,  and
almost 300 started. Of these, less than 1% were later deemed not to have met their aims and so
closed – a far lower rate than in many other development sectors.

– 

Conflict and Post-Conflict Situations

Volatile  political  situations  in  several  African  countries  in  2002  led  to  real
difficulties in implementing many EC-funded ACP rehabilitation projects. In Eritrea,
for  example,  a  €20  million  contribution  intended  to  help  re-integrate  soldiers  into
civilian life was blocked after the Eritrean government failed to issue demobilisation
instructions to its forces.

However,  the  Commission  is  finding  that  with  persistence  and  a  long-term
commitment  to  countries  or  regions  in  conflict  real  results  can  be  achieved.  For
example,  despite  a series  of  setbacks,  one project  in  Sierra Leone was  successfully
completed in July 2002 and has had a positive impact across society (see box below).

The  Commission  is  equally  committed  to  incorporating  the  latest  techniques  to
deliver its external assistance, leveraging advances in both development thinking and
practical  technology.  This  commitment  can  sometimes  have  surprising  results.  In
Tanzania,  for  example,  the  EC  spent  over  €1  million  in  2002  on  programmes  in
which  rats  are  used  to  detect  landmines,  thereby  significantly  reducing  clearance
costs without causing harm to the animals involved.

The  EC  was  actively  engaged  in  mine-related  projects  elsewhere  in  Africa,  too.  In
Somalia and Ethiopia, for example, projects in 2002 supported National Mine Action
Centres to coordinate mine clearance, and funded impact surveys to reduce the harm
caused by mines to local communities.

Rehabilitation in Sierra Leone:
helping families return to normal life

Interruptions to one €9.2 million project, started in 1997 and completed in 2002 in Sierra Leone,
highlight  the  difficulties  of  delivering  some  of  the  EC’s  rehabilitation  programmes  assistance
against a backdrop of political volatility or, worse, outright conflict.

193

Rehabilitation in Sierra Leone:
programme implementation chronology, 1997-2002

Date

Event

Mar

project launched

1997

May

coup d’état halts project

1998

Jul

project relaunched

1999 Mar

original closing date of project
worsening security prompts technical team’s temporary evacuation

2000 May

technical support team temporarily evacuated

2002

Jul

project completed

However,  when  such  projects  can  be  completed  their  impact  is  generally  wide-
ranging and long-lasting, as results of the Sierra Leone programme demonstrate.

Area

Agriculture

Rehabilitation in Sierra Leone:
programme results to end 2002

Result

over 4 500 families receiving farming or fishing subsidies

1 200 tradespeople helped to rebuild local markets and process crops

over 2 000 returnee families trained in work-related skills

Employment

labour-intensive projects set up, employing over 5 000 people

over 3 000 women trained in farming and other work skills

Education

new schools built, used by over 12 300 pupils

Infrastructure

over 850 km of roads, 3 bridges, 3 markets and 1 jetty reopened

– 

Refugees and Displaced Populations

The  EC  was  actively  engaged  in  2002  in  refugee  projects  throughout  sub-Saharan
Africa  –  in  Angola,  Burundi,  Congo,  Congo  (DRC),  Djibouti,  Eritrea,  Ethiopia,
Liberia, Mauritania, Namibia and Tanzania. Such projects aim to either help people
displaced by civil war or ethnic tensions or lay the groundwork for, and then execute,
their safe return home.

Refugee project implementation  in 2002 in ACP countries was often difficult,  with
results  at  best  limited.  In  Burundi,  for  example,  the  EC  launched  a  programme  in
2000 in partnership with the UN’s High Commission for Refugees to aid the return
of refugees who had fled to Tanzania following Hutu-Tutsi ethnic strife in the early
1990s. After disappointing results, the project will have to be thoroughly revised.

194

Refugees and displaced populations in Burundi and Tanzania:
EC-UNHCR refugee return programme, results to end 2002

EC allocation to project (€ million)
Number of refugees returned from
Tanzania to Burundi

intended
actual to end 2002

25.0
343 000
49 613

Why, then, have the results of such programmes proved disappointing? Certainly not
for  lack  of  detailed  planning  and  evaluation.  To  ensure  the  successful  return  of
displaced  people  without  further  destabilising  recipient  countries,  the  EC’s
programmes  in  2002  funded  not  just  the  immediate  logistics  of  returning  large
numbers of people – including convoys, transit sites, and special help for the sick and
elderly but also longer-term measures in return destinations to help ensure returnees’
successful reintegration. These included reconstructing or upgrading social services –
schools, health clinics and so on; and strengthening local justice systems to resolve
property and other disputes that can arise when refugees return home.

Sadly,  almost  all  refugee  programmes  in  Africa  were  interrupted  in  2002,  largely
because of wider political instability and threats to personal security. In Burundi, for
example,  a  Tutsi-Hutu  transitional  power-sharing  government  has  so  far  failed  to
sign a comprehensive cease-fire with the country’s main rebel groups.  Indeed, both
the  army  and  rebels  launched  renewed  offensives  in  2002,  thereby  strongly
discouraging Burundian refugees from returning home.

6.4.4

The ‘Three Cs’: Coherence, Coordination and Complementarity

6.4.4.1 Cooperation with EU Member States and other donors in the ACP region

Strengthening  coherence,  coordination  and  complementarity  with  other  donors  is
vital  in  ACP  states,  since,  relative  to  other  countries,  many  sub-Saharan  states
depend  to  a  higher  degree  on  external  assistance  to  tackle  development  issues  and
lack government capacity sufficient to deal with donor competition and duplication,
or  donors’  often  complex  and  differing  funding  procedures.  So  in  its  assistance  to
ACP countries in 2002, the Commission strove to apply the ‘Three Cs’ more  fully,
together with EU Member States and other ACP donors.

Such  efforts  by  the  Commission  in  2002  were  typified  by  the  positive  results
achieved  in  supporting  fisheries  in  Pacific  states.  First,  in  negotiations  for  an  EU-
Kiribati  Fisheries  Partnership  Agreement,  signed  in  2002,  the  Commission  was
committed to ensuring development issues related to fisheries were fully taken into
account.  Hence  the  agreement  that  has  been  signed  provides  for  responsible,
sustainable  marine  resource  exploitation,  and  similar  EU  agreements  with  other
Pacific ACP states are now likely.

Second, fisheries support was a feature of Regional Strategy Papers signed in 2002:
in  the  Pacific  RSP,  fisheries  are  classed  as  a  ‘focal’  development  sector,  with  €5
million  allocated  to  extend  the  EC’s  PROCFISH  Programme  to  six  new  Pacific
states, and to help strengthen regional fisheries ministries and monitoring bodies; in
West  Africa  fisheries  constitute  a  ‘non-focal’  development  sector;  and  in  Central
Africa they comprise a ‘focal’ development sector.

The  ‘Three  Cs’  were  incorporated  into  the  EC’s  external  assistance  in  other  ways,
too,  and  three  examples  are  highlighted  here.  First,  the  Caribbean  Anti-Money

195

Laundering Programme (CALP), launched in 2002, responds to the vulnerability to
drug cartels of the region’s fast-expanding finance sector. It draws on funding from
the  EC  and  from  the  UK  and  US  acting  jointly  (funds  in  2002  amounted  to  €4
million  from  the  EC,  and  €3.2  million  from  the  UK  and  US  combined).  The
programme  augments  existing  bodies  such  as  the  Caribbean  Financial  Action  Task
Force on Money Laundering.

Second, the EC’s efforts in 2002 in least developed countries to apply the ‘Three Cs’
were  in  large  part  focused  on  drawing  up  Poverty  Reduction  Strategy  Papers
(PRSPs)  in  several  ACP  countries,  and  on  the  Strategic  Partnership  with  Africa
(SPA),  which  complements  African  PRSPs  and  in  which  the  Commission  was
actively engaged (more details in 6.4.1 above).

Third, the Commission initiated External Sustainability Impact Assessments in 2002,
in  tandem  with  the  Commission’s  EPA  negotiations  with  ACP  countries.  Such
assessments are intended by the Commission to be used to harmonise EU trade and
development  policies  for  the  benefit  of  the  ACP  region;  to  address  broader  but
related economic, social and environmental issues; and thereby to ensure that EPAs
will impact ACP states as positively as possible.

6.4.4.2 European Investment Bank (EIB) activity in ACP countries

Under  the  terms  of  the  Cotonou  Agreement,  the  European  Investment  Bank  (EIB)
aims to promote the private sector as the main engine of economic growth and ACP
countries’ integration into the world economy.

Over 70% of major loan decisions by the EIB in 2002 to promote economic growth
in  ACP  countries  (including  South  Africa)  therefore  went  to  the  private  sector  or
commercially-run public sector — e.g.: to power or water infrastructure projects. The
most  important  loans  in  2002  went  to  Cape  Verde  (Airport  and  traffic  control
infrastructure upgrade —  €20  million) and  Gabon  (submarine  optic  fibre  telephone
cable installation — €22 million).

6.4.4.3 European Community Humanitarian Aid Office (ECHO) activity in ACP countries

Unfolding humanitarian crises in Africa in 2002 posed a major challenge for ECHO
and will be of equal concern in 2003, since over 50% of the world’s current armed
conflicts, and over 25% of all refugees in the world are in Africa. In response, the EC
provided humanitarian aid of over €210 million to ACP countries in 2002. Below is a
summary of that activity.

196

ECHO activity in ACP countries:

summary of financing decisions, 2002

Region

Summary of decisions(€ million)

Caribbean, Pacific

West Africa

Central Africa

West & Central Africa

Eastern & Southern Africa, Indian Ocean

All Africa

Total

6.4.5

Results-Oriented Monitoring

0.6

33.3

0.3

0.2

126.8

50.1

211.3

In  2002,  there  were  over  290  monitoring  visits  to  country  programmes  in  40  ACP
countries,,  including  South  Africa  and  Cuba.  Regular  monitoring  of  regional
programmes was also started in early 2002.

Results-oriented monitoring:

visits to country projects in priority development sectors, 2002

Priority sector

No. of
report
s

No. of
projects

Total budget
(€ million)

Av.
project size

(€ million)

1  Trade and development

2  Regional integration

3  Macro. policies, social services

4  Transport

5  Food security, rural development

6  Instit. capacity, good governance

7  Other

14

77

54

20

48

76

9

14

41

54

20

48

76

9

227.9

457.8

760.7

804.4

343.2

267.3

50.2

16.3

11.2

14.1

40.2

7.2

3.5

5.6

Total

298

262

2911.0

11.1

197

These  visits  proved  helpful  in  improving  future  assistance,  by  allowing
project  performance  to  be  compared  in  three  revealing  ways.  First  of  these
was  the  performance  of  projects  in  each  development  sector  vis-à-vis  other
sectors:  for  example,  monitoring  results  for  a  sample  of  18  education
programmes,  key 
reduction  objectives,  were
encouraging, scoring an average of 2.74 compared to an average for all ACP
projects monitored of 2.48.

the  EC’s  poverty 

to 

The  second  comparison  derived  from  monitoring  was  of  the  strengths  and
weaknesses of ACP projects relative to those in other regions: ACP projects
evaluated in 2002 tended to be more  effective  and have  greater impact,  but
also to be less sustainable and less efficient. The third comparison was with
programmes  not  subject  to  re-monitoring:  re-monitored  projects  tended  to
perform  better  than  average,  suggesting  that  monitoring  improves  the
performance of the EC’s ACP projects.

Results-oriented monitoring:

average ratings of priority-sector projects evaluated, 2002

Criterion Trade

Reg.
integration

Macro.

Trans.

Food
security

Instit.

Other2 All

& dev.

policies

& infra

capacity

ACP

Relevance

Efficiency

2.50

2.43

Effectiveness

2.57

Impact

2.57

Sustainability 2.36

Average

2.49

2.36

2.18

2.35

2.26

2.32

2.30

2.48

2.41

2.57

2.56

2.28

2.46

2.75

2.50

2.95

2.65

2.35

2.64

2.65

2.56

2.75

2.63

2.40

2.60

2.55

2.42

2.66

2.58

2.49

2.54

2.44

2.51

2.56

2.39

3.00

2.60

2.89

2.52

2.56

2.38

2.69

2.48

6.4.6

Conclusions and Prospects for the Years Ahead

There  are  perhaps three main lessons that  the  Commission  must learn  from
the successes  and difficulties of  ACP external  assistance  implementation  in
2002.  First,  the  completion  of  ACP/OCT  programming  offers  a  solid
basis  for  future  assistance.  The  focus  of  both  ACP  countries  and  the  EC
must  now  be  to  execute  Country  Strategy  Papers  and  Regional  Strategy
Papers;  deliver  the  results  envisaged  in  the  Strategy  Papers;  programme
9th EDF territorial and regional resources for OCTs; improve OCT access to
EU programmes/budget lines; and fully commit past EDFs.

Second,  EU-ACP/OCT  relations  evolved  significantly  in  2002,  and  will
continue  to  do  so.  This  evolution  was  in  large  part  due  to:  the  entry  into
effect  of  the  Cotonou  Agreement  following  ratification  by  ACP  and  EU
states African countries’ explicit commitment to strengthening their capacity

198

to  deal  with  conflict,  poverty  and  marginalisation  in  the  global  economy
through initiatives such as the launch of the  African Union; and acceptance
of  Poverty  Reduction  Strategy  Papers  as  the  basis  for  EC  support  to  least-
developed countries.

Third, EC assistance to  ACP/OCT  states  must  become  more  responsive
in a number of areas.
(cid:1)  Major development challenges facing ACP/OCT states, notably in Africa.
Sub-Saharan  Africa  is  the  region  in  the  world  that  will  struggle  most  to
reach its Millennium Development Goals, and the EC must do all it can to
help  keep  countries  on  track  through  a  coherent  combination  of
development  assistance,  political  dialogue  and  non-development  policies
and instruments (e.g. in trade).

(cid:1)  New developments in ACP/OCT countries or regions. The launch in 2002
of  EU  water  and  energy  initiatives  at  the  World  Summit  on  Sustainable
Development in September prompted the Commission and Member States
to  examine  with  developing  countries  how  support  in  these  areas  might
accelerate  progress  in  attaining  the  MDGs.  The  EU  must  also  enhance
dialogue with OCTs under the new EU-OCT partnership procedure.

(cid:1)  Regional and sub-regional integration efforts, of which the launch of the
AU and its adoption of NEPAD was a notable example in 2002. EPA talks
with  ACP states will  constitute  the  EC’s  main  response  in  2003  to  ACP
states’ commitment to capacity-building.

(cid:1)  Conflicts and crises. Such situations cannot always be predicted, but must
be addressed more  quickly  than has  been  the  case  to  date  as  a  matter  of
priority,  so  as  to  limit  further  their  impact  on  development  and
EC-programmed assistance.

6.5

ASIA

Asia  accounts  for  56%  of  the  world’s  population  (and  66%  of  the  world’s
poor), while generating 25% of world GNP.

Its share of EU imports is gradually increasing (currently about 27% ) while
its share of EU exports has been relatively constant (at around 18% ).

EC  cooperation  funding  for  the  developing  countries  in  Asia  has  grown
moderately  in  recent  years,  averaging  some  €407  million  per  year  in
1996-2001. However, 2002 commitments amounted to almost €540 million,
the increase mainly accounted for by  allocations to  Afghanistan  confirming
the EC’s political commitment to the reconstruction of that country.

199

Asia-Overview of commitments/payments 1996-2002 (€ million)141

1996

1997

1998

1999

2000

2001

2002

Total

Commitments

405.7 435.3 423.3 342.7

447

387 539.8

2980.8

Payments

279.1 301.9 262.1 289.2 318.5 376.9 433.5

2261.2

Taking EC and Member States aid together, the EU continues to account for
about  25%  of  total  ODA  flows  to  Asia.  Community  assistance  in  Asia  is
complementary to the assistance provided by the Member States, in dialogue
with  the  beneficiary  countries,  and  with  other  bilateral  and  multilateral
donors.

6.5.1

Strategic Goals and Achievements

From  the  EU  perspective,  the  core  objective  of  EU-Asia  relations  into  the
first  decade  of  this  century142  is  to  strengthen  the  Union’s  political  and
economic presence across Asia, raising  it  to  a  level  commensurate  with the
growing global weight of an enlarged EU. In order to meet this objective, the
strategy of the EU is based on six priorities:

– 

– 

– 

– 

– 

– 

contribute to peace and security in the region;

strengthen mutual trade and investment flows;

promote the development of the less prosperous countries of the region,
addressing the root causes of poverty;

contribute  to  the  protection  of  Human  Rights  and  the  promotion  of
democracy, good governance and the rule of law;

build global partnerships and alliances with Asian countries;

help strengthen the awareness of Europe in Asia (and vice versa).

in 

in  January.  The  EC  contributed  over  €270  million 
large 

One of the major challenges to promoting peace and security in 2002 was
the  situation  in  Afghanistan,  demanding  a  huge  short-term  reconstruction
effort  in  line  with  the  undertakings  given  at  the  Tokyo  Ministerial
Conference 
to
Afghanistan, 
reconstruction/rehabilitation
two 
programmes,  food  and  humanitarian  aid  and  aid  for  those  who  had  been
uprooted. Initially, the aid programme had a strong focus on rural recovery/
food security with accompanying de-mining  activities, aimed  at helping the
largely  rural  population  revive  their  traditional  means  of  production.
Improvement  in  the  availability  of  health  services,  education  facilities  and
basic urban rehabilitation complemented this. Peace and conflict prevention

the  form  of 

141

142

Includes horizontal/thematic budget lines
Stated  in  COM (2001) 469  Europe  and  Asia:  A  Strategic  Framework  for  Enhanced
Partnerships

200

                                                
concerns  also  figured  prominently  in  actions  undertaken  in  East  Timor,
Indonesia, Pakistan, and Sri-Lanka.

responsibilities  of 

international  agreements.  Reflecting 

Work continued in 2002 to strengthen mutual trade and investment flows,
with  assistance  provided  both  through  regional  programmes  and  bilateral
projects. The aims were inter alia to promote private sector development and
to  assist  partner  countries  to  prepare  for  WTO  membership  and/or  assume
the  EC
the 
development  policy  focus  on  poverty  alleviation,  over  a  third  of  the  2002
budget for technical and financial cooperation was allocated to social sector
projects,  notably  in  basic  health  and  primary  education.  New  operations  in
these  fields  were  increasingly  designed  in  a  sector  programme  context  in
conjunction  with  the  efforts  of  other  donors.  Sustainable  development  and
gender  concerns  were  an  integral  part  of  all  projects,  while  access  to
education  and  health  facilities  for  girls  and  women  have  been  a  particular
focus.

The  EC  also  contributed  €18  million  to  the  EC-ASEAN  Energy  Facility,
which  started  in  2002  and  will  provide  for  about  20  grants  for  individual
projects in 2003.

6.5.2

Programming and Country Priorities

EU  external  cooperation  policies  are  enshrined  in  cooperation  agreements,
protocols,  administrative  arrangements  and  memoranda  of  understanding.
These provide the legal basis for programme implementation and budgetary
expenditure.

In  2002,  programming  activities  for  the  Asia  region  resulted  in  the  formal
adoption  of  13  Country  Strategy  Papers  (CSPs).  By  the  end  of  December
2002,  the  Commission  had  finalised  and  published  CSPs  for  Bangladesh,
Cambodia,  China,  East  Timor,  India,  Indonesia,  Laos,  Malaysia,  North
Korea, Pakistan, Philippines, Thailand and Vietnam, most of which cover the
period  2002-2006.  Additional  strategies  for  Afghanistan,  Bhutan,  and  Sri
Lanka were well advanced in the drafting and adoption process.

The priorities  for  cooperation  with  Bangladesh and Vietnam  are  to  reduce
poverty in a sustainable manner and facilitate their integration into the world
economy. The strategies for Cambodia and Laos focus primarily on poverty
reduction.

The  priorities  of  EC-China  cooperation  are  to  further  China’s  integration
into the world economy and world trading system and support its transition
towards  an  open  society  based  on  the  rule  of  law  and  respect  for  human
rights.

The  priority  for  EC  cooperation  with  India  is  to  support  the  government’s
policy of reducing poverty by half within a decade, with particular emphasis
on  social  and  economic  reforms,  improved  governance  and  sustainable
development.

201

EC-Indonesia  cooperation  will  encourage  the  consolidation  of  democracy
and good governance.

EU  priorities  for  cooperation  with  East  Timor  are  to  help  consolidate
democracy  and  the  rule  of  law,  encourage  respect  for  human  rights  and
fundamental  freedoms,  and  assist  in  the  reconstruction  of  the  newly-
independent country.

Under  the  EC-Democratic  People’s  Republic  of  Korea  (DPRK)  strategy
Commission’s  priorities  focus  on  a  limited  number  of  areas,  mainly
institutional support and capacity building; sustainable management and use
of natural resources.

EC-Malaysia  cooperation  focuses  on  enhancing  bilateral  relationships,  in
particular by strengthening economic, educational and cultural ties.

The priority for Pakistan is to support government efforts to reduce poverty
and  help  facilitate  the  country’s  integration  into  the  world  economy.
EC-Philippines cooperation strategy will focus on assistance to the poorest
sectors of society and on smoothing the country’s integration into the flow of
international trade.

The priority of EC-Thailand cooperation is to support sustainable economic
and social development.

6.5.3. Main Results in 2002

Country  programming  up  to  2006,  as  defined  in  Country  Strategy  Papers,
was neared completion in 2002, helping to clarify priorities and providing a
basis  for  dialogue  with  partner  countries.  It  also  helped  coordination  with
Member States and other donors.

The objectives set by the budget for new commitments and payments in 2002
were  met,  and  an  additional  €70  million  from  the  budget  margin  was
committed for projects in Afghanistan.

202

Commitments and payments in Asia in 2001 and 2002 (€ million)

Programmes

Commitments

Payments

2001

2002

2001

2002

Countries Bilateral

Regional

Subtotal
Bilateral/Regional

Thematic actions

Grand total

225.0

64.5

289.5

88.8

378.3

264.6

41.2

305.8

72.1

377.9

Afghanistan – a rapid start to reconstruction in 2002

Afghanistan  was  a  major  political  priority  for  EC  assistance  in  Asia  in  2002,  with
commitments from the Community totalling more than €270 million. In response to the
persistent  humanitarian  crisis,  characterised  by  ongoing  armed  conflicts,  prolonged
drought  and  a  significant  number  of  refugees  and  internally  displaced  people,
humanitarian aid (from the ECHO budget) reached €73 million. The EuropeAid Office
provided  almost  €200  million  for  reconstruction  activities,  of  which  €127.5  million
came  from  the  Asia/Latin-America  budget  line  (first  and  second  reconstruction
programmes),  €44.6  million  from  the  Food  Aid/Security  budget  line,  and  €24  million
from  the  budget  line  ‘Aid  to  Uprooted  People’.  The  Rapid  Reaction  Mechanism
provided the remaining funds.

The  EC  is  a  major  donor  to  the  reconstruction  process,  for  which  the  Afghans
themselves  have  ownership  and  lead  responsibility.  EC-funded  programmes  included
rehabilitation of 167 health facilities; 1 400 health professionals have received training
and more than 4 million consultations took place. The rehabilitation of 7 000 wells and
the  construction  of  12 000  latrines  made  drinking  water  safer and  improved  hygiene.
Five  hundred  schools  have  been  rehabilitated  and  more  than  1 100  teachers  trained,
allowing about 170 000 pupils (boys and girls) access  to  formal  education.  More  than
27 000 tons of improved seeds have been distributed to farmers, up to 300 small-scale
irrigation  systems  received  reconstruction  support  and  about  320 km  of  rural  roads
have  been  rehabilitated.  These  reconstruction  and  rehabilitation  activities  created
more  than  3 million  days’  labour,  most  of  them  remunerated  in  cash,  which
contributed  significantly  to  the  purchasing  power  of  the  needy  rural  and  urban
population.

Besides  addressing  people’s  immediate  needs,  the  EC  contributed  to  the  functioning
and reform of public services, an essential prerequisite for the normalisation process in
Afghanistan,  via  cash  contributions  to  the  UNDP  Trust  Fund  (€20  million)  and  the
World Bank-managed Afghanistan Reconstruction Trust Fund (€30 million).

203

6.5.3.1 Implementation

– 

Peace and Security, Democracy and Good Governance

Peace and stability are essential conditions for economic growth and poverty
reduction – insecurity and unrest can put a brake on development. Tensions
in South Asia between India and Pakistan, ethnic conflict in Afghanistan and
Sri  Lanka,  and  conflicts  such  as  those  in  Indonesia,  Nepal,  and  the
Philippines are ongoing concerns for the international community. Following
the  events  of  11  September  2001,  a  number  of  Asian  countries  have  been
affected by  acts  of  terrorism.  Other  matters  giving  rise  to  concern  included
the  state  of  human  rights  in  several  Asian  countries  and  the  condition  of
millions  of  refugees,  displaced  people  and  minorities  across  the  region.  In
addition to participating in a process of political dialogue in ASEAN, ASEM
and other fora, the EC has deployed financial and technical resources through
various instruments at its  disposal to encourage peace  and stability  in Asia.
The  European  Initiative  for  Democracy  and  Human  Rights  (EIDHR),  the
Rapid  Reaction  Mechanism  (RRM)  and  the  budget  line  for  Refugees/
Displaced People are examples of such mechanisms.

– 

Conflict Prevention, Good Governance and Rule of Law

In 2002 more than €10 million went to projects in Asia under the European
Initiative  for  Democracy  and  Human  Rights  (EIDHR).  Activities  were
carried out by non -governmental organisations, universities and independent
institutions.

One of  the main priorities  of the EIDHR  is  support  for  the  abolition  of  the
death  penalty,  an  example  being  the  project  financed  in  the  Philippines  in
2002  [?]  to  foster  the  work  of  the  Philippine  Human  Rights  Information
Centre. Under the heading of Good Governance, a programme was drafted to
improve  access  to  justice  for  the  poor  and  combat  corruption.  In  China,
support was given to a programme designed to for strengthen the capacity of
defence lawyers to uphold the legal rights of those accused of capital crimes.

Combating  racism,  xenophobia  and  discrimination  against  minorities  and
indigenous peoples is another of the main priorities of the EIDHR. In 2002,
activities were initiated in Nepal, Pakistan, India, Indonesia and Malaysia.
In  the  area  of  women’s  rights,  the  EIDHR  financed  a  capacity-building
project  in  Indonesia  to  help  the  judicial  sector  deal  with  cases  of  violence
against  women.  EIDHR  supported  the  democratisation  process  in
Burma/Myanmar  and  helped  smooth  the  transition  to  democracy  by
strengthening  the  capacity  of  the  democracy  movement,  specifically  the
ethnic nationalities,  women,  youth,  and  the  traditionally  disenfranchised.  In
Cambodia,  it  supported  capacity-building  for  democratic  structures  at  a
communal  level;  while  in  Pakistan,  it  helped  increase  the  participation  of
vulnerable  groups  in  decision-making  processes  in  society  in  order  to
improve monitoring and respect for human rights in 10 districts.

204

EU  electoral  observer  missions  (EUEOM):  the  EIDHR  supported  the
transition to democracy in Asia by sending EU electoral observer missions to
the elections held in 2002 in Pakistan, East Timor and Cambodia. The EU
electoral  observation  mission  to  the  Parliamentary  Elections  in  Pakistan  in
October  2002  was  conducted  by  nine  Core  Team  members  for  ten  weeks,
with 43 Long Term Observers deployed to thirteen different locations in all
four provinces for three to five weeks. In addition, 30 Short Term Observers
were  deployed  for  up  to  ten  days,  and  a  delegation  of  Members  of  the
European Parliament were also present. On election day (10 October), a total
of 88 EU Election Observation Mission members were involved in observing
polling, the counting of votes and the aggregation of results.143

In East Timor, a presidential election was held on 14th April 2002; the EU
electoral observation mission was composed of a Core Team comprising four
experts, 4 Long Term Observers and 26 Short Term Observers.144 Although
funded under the 2001 budget, The EU electoral observation mission to the
local  elections  in  Cambodia  in  February  2002  (19  December  2001-
26 February 2002) fulfilled most of its tasks. This was the first time that the
EU  had  established  an  EOM  to  observe  local  elections,  reflecting  the
importance of the first direct elections to Commune Councils in the modern
history  of  Cambodia.  The  mission  produced  a  useful  assessment  of  the
election process and recommendations  ahead of the  Parliamentary  elections
scheduled for July 2003.145

An  EU  Election  Observation  Mission  was  approved  for  the  Parliamentary
Elections in Nepal (scheduled for November 2002), and the funding decision
adopted.  However,  in  the  event  the  elections  were  postponed  and  the
EUEOM was not deployed.

– 

Rapid Reaction Mechanism (RRM)

The RRM is designed to enhance the EU’s civilian capacity to intervene fast
and  effectively  in  crisis  situations  in  third  countries.  Its  added  value  is  its
speed  and  flexibility  in  situations  of  high  tension  immediately  prior  to,
during and after crises. This new tool proved particularly valuable in Asia in
2002.

The  second  RRM  programme  for  Afghanistan  (€5.9  million)  included
operations/projects  to  strengthen  the  institutional  capacity  of  the  new
Administration  and  help  mobilise  public  support  for  the  reconstruction
process.  Capacity-building  measures  included  support  to  the  Assistance

143

144

145

The Final Report of the EUEOM in Pakistan is available on
http://europa.eu.int/comm/external_relations/Human_Rights/eu_election_ass_observ/index.ht
m
The Final Report of the EUEOM in East Timor is available on
http://europa.eu.int/comm/external_relations/Human_Rights/eu_election_ass_observ/index.ht
m
The Final Report of the EUEOM in Cambodia is available on
http://europa.eu.int/comm/external_relations/Human_Rights/eu_election_ass_observ/index.ht
m

205

                                                
Coordination Authority, rehabilitation of city planning capacity in five major
cities  and  training  of  government  staff.  The  programme  also  supported  the
creation  of  a  “Media  House”,  giving  local  journalists  have  access  to
international news sources, the establishment  of  an  independent  newspaper,
and the training of journalists.

An  assessment  mission  was  sent  to  Indonesia  in  early  2002  to  identify
possible interventions targeting potential local/regional conflicts in different
parts  of  that  country.  As  a  direct  result,  a  number  of  RRM  operations  took
place in Irian Jaya and Maluku supporting mediation and conflict resolution
measures,  including  a  project  focusing  on  the  role  of  women  in  conflict
prevention.  The  increased  awareness  of  the  Indonesia  situation  enabled  the
RRM  to  react  quickly  to  the  Cessation  of  Hostilities  Agreement  in  Aceh
(Sumatra) and a project to support the international monitoring mission was
put in place late 2002 (€2.3 million).

An RRM expert mission was sent 2002 to the Philippines in late November
to  assess  the  need  for  EU/EC  assistance  in  the  fight  against  terrorism.  The
mission resulted in an assistance programme comprising measures targeting
terrorist  funding,  border  controls,  police  training,  capacity-building  for  the
judiciary and emphasising the impact of good governance activities.

An assessment mission was sent to identify possible measures to mitigate the
effects of the conflict with the Maoist guerrillas in Nepal, especially in areas
where important EC development cooperation programmes are located. The
mission resulted in a Conflict Mitigation Programme aimed at containing the
effects  of  the  conflict,  and  laying  the  groundwork  for  future  EC  medium-
term  assistance 
through  confidence-building  measures  and  economic
empowerment  of  the  vulnerable  local  population.  It  also  proposed  a
programme  to  promote  a  free  and  fair  electoral  process  for  the  November
2003 elections.

A €1.8 million programme was adopted in September 2002 in support of the
Ceasefire  Agreement  between  the  Government  of  Sri  Lanka  and  the
Liberation Tigers of Tamil Eelam (LTTE). It comprises measures to facilitate
a  flow  of  information  on  the  peace  process,  support  for  the  Human  Rights
Commission, and a programme to restore schools in the conflict zone so that
they can once again be used for their original purpose.

– 

Rehabilitation/Landmines

In  addition  to  humanitarian  aid  from  ECHO  and  the  food  security  budget
line,  the  bulk  of  EC  assistance  to  Afghanistan  in  2002  came  from  the
development  cooperation  budget  line.  The  complex  emergency  situation
required a multi-sectoral approach. Besides bringing assistance to the needy,
the  programme  helped  restore  certain  government  services  and  promoted
civil society activities. Two reconstruction programmes were approved for a
total  of  €127.5  million.  Speed  was  of  the  essence;  contracts  for  over
€85 million  were  signed  in  2002,  and  almost  €55  million  was  disbursed  on
operations in the field.

206

The EC contributed €2 million to Sri Lanka for the rehabilitation of a 20 km
railway track in the Eastern province, aiming to build  confidence  and  bring
the tangible benefits of the peace process to the population. Commitments of
€28  million  were  made  available  for  the  reconstruction  of  the  newly
independent  East  Timor.  Three  interventions  were  approved  in  order  of
magnitude,  the  Health  Sector  Rehabilitation  and  Development  Programme,
the multi-donor Trust Fund, to which the  EC  is  the  largest  contributor,  and
specialised assistance to key government departments. In response to armed
conflict  and  typhoons  in  Mindanao  (Philippines)  the  EC  provided  direct
support for NGO operations and indirect support via ECHO.

Mine  clearance  formed  an  integral  part  of  several  larger  Asian  projects,
while  stand-alone  projects  were  carried  out  in  Laos  and  Sri  Lanka.  A
technical  assistance  project  in  Laos,  to  which  the  EC  contribution  was
€900 000,  is  being  implemented  by  Handicap  International  Belgium.  The
training  system  and  supporting  databases  that  are  being  developed  are
particularly effective and will enable the Mine Action Centre in Savannakhet
Province  to  become  autonomous.  The  EC  contributed  €800 000  towards  a
landmine  impact  survey  and  mine  clearance  project  in  Sri  Lanka,  the  aim
being to allow the safe return of war-displaced populations to their areas of
origin and thereby contribute to economic recovery and reconstruction in the
Northern and Eastern provinces.

– 

Refugees/Displaced People

In  2002,  the  focus  in  Asia  was  on  displacement  of  population,  mainly  in
Afghanistan.  €22  million  was  provided  via  a  consortium  of  NGOs  to  help
Afghan  refugees  and  internally  displaced  persons  to  return  to  their  homes.
The  programme,  which  will  directly  assist  more  than  4  million  returnees
across most of the Afghan provinces, has two main aims: to facilitate return
to  areas  outside  the  major  cities  by  repairing  or  rebuilding  infrastructure  in
the  returnees’  place  of  origin  and  to  support  communities  during  the
reintegration process, helping them tackle the consequences of long-standing
conflict, unprecedented drought, and loss of productive assets. Additionally,
a  contribution  of  €2  million  was  made  available  to  the  UN  High
Commissioner for Refugees for the return of Afghan refugees from Iran and
Pakistan to their home country.

Burma/Myanmar:  The  EC  contributed  €1.9  million  to  a  project  to  aid
resettlement of returnees in North Rakhine State and improve the welfare of
the most vulnerable people, particularly the landless, and €0.54 million to a
second project dealing with  Agriculture  and Natural Resource  Management
in  the  same  State.  Indonesia:  The  EC  contributed  €1.49  million  to  a
resettlement and economic  recovery  project  in  Maluku  and  Central  Sulawesi
and  €0.58  million  to  a  return  and  resettlement  project  in  North  Maluku
designed to ensure that primary school-age children have better access to the
formal  education  system.  Philippines:  Two  projects  targeted  displaced
populations in the island of Mindanao. One (EC contribution: €0.97 million)
provided refugees affected by the war and unable to return to their place of
origin with long-term, sustainable support in the form of income-generating
activities  and  improved  social  services.  The  other  (EC  contribution:

207

€0.60 million)  enhanced  the  living  conditions  of  the  population  affected  by
the conflict in rural areas of Maguindanao and Lanao de Sur provinces. The
EC is supporting UNHCR programmes in Sri Lanka, Thailand and Nepal.
In  Sri  Lanka  (EC  contribution:  €3.9  million),  the  programme  provides
assistance to spontaneous returnees and IDPs (Internally Displaced Persons),
whereas in Thailand and Nepal (EC contribution: respectively €2 million and
€0.9  million),  the  programmes  give  protection  and  assistance  to  refugees
from Burma/Myanmar and Bhutan who are currently living in camps.

– 

Strengthening Mutual Trade and Investment Flows

As  major  forces  in  the  world  economy,  both  Asia  and  Europe  -  important
trading partners - face many challenges from globalisation. In an increasingly
interdependent  world,  the  two  regions  must  work  together  to  ensure  the
success  of  an  open  rule-based  multilateral  trading  system  while  fostering  a
climate  favourable  to  foreign  direct  investment.  It  is  in  the  joint  interest  of
the  two  regions  to  address  the  adverse  effects  of  globalisation,  social  or
environmental, while embracing, to their mutual benefit, the opportunities it
offers.

It  is  widely  recognised  that,  in  the  longer  term,  the  future  of  Asia’s
developing  countries  will  crucially  depend  not  on  aid  flows  but  on  the
region’s  own  resources,  political  will,  good  governance  and  efficient
investment.  he  thrust  of  the  EC’s  cooperation  efforts  in  the  trade  and
investment field therefore focuses on pilot projects and technical cooperation
schemes  aimed  at  promoting  mutually  beneficial  business-to-business
cooperation, improving the economic environment and raising the profile of
Europe in Asia and vice versa.

– 

Institution Building

in 

the  WTO,  devoted  considerable  efforts 

In 2002, the EC, in line with the Communication on EC Development policy-
2000146 and the commitments undertaken in the Doha Development Agenda
to  assisting
negotiations 
developing  Asian  countries  in  their  integration  into  the  global  economy.  A
major  project  focusing  on  WTO  accession  was  approved  for  China  and
another  for  Cambodia  and  Laos  while  a  project  for  Vietnam  supports  the
transition  towards  a  market  economy.  The  newly  approved  Small  Projects
Facilities  for  Indonesia  and  the  Philippines  will  also  support  economic
reform  processes.  The  South  Asia  Enterprise  Development  Facility  in
Bangladesh,  implemented  by  the  International  Finance  Corporation  (IFC),
aims  at  reforming  the  institutional  and  economic  framework  under  which
SMEs operate, as well as providing direct assistance to SMEs.

146

Communication  from  the  Commission  to  the  Council  and  the  European  Parliament  on  the
European Community’s Development Policy, COM(2000) 212 final dated Brussels, 26.4.2000

208

                                                
Several  horizontal  and  regional  cooperation  programmes  with  Asia  were
initiated or continued in 2002. The Asia Invest programme, which promotes
business  cooperation  between  Asia  and  Europe,  was  continued  after  an
evaluation of the results achieved so far, and allocated an additional budget
of  €35  million.  Some  75  projects  involving  small  and  medium-sized
enterprises  in  Europe  and  Asia  were  implemented  with  a  total  EC
contribution  of  €8.4  million.  In  December  2002,  the  Commission  signed  a
new  grant  contract  with  the  Asia-Europe  Foundation  in  Singapore,  which
promotes  mutual  understanding  and  cultural  exchange  in  the  framework  of
the Asia-Europe Meeting (ASEM). The Commission will be making a total
of  €3.5  million  available  over  the  next  four  years  to  co-finance  specific
project  activities  undertaken  by  the  Foundation.  Additional  funding  of
€8 million was approved for the Asia IT & C (Information Technology and
Communication)  programme  whose  purpose  is  to  increase  cooperation
between Europe and  Asia  in this  area by  co-financing  projects  managed  by
European/Asian  partnerships.  The  Asia  Urbs  scheme,  which  supports
cooperation  on  urban  and  socio-economic  development  continued  during
2002,  and  15  new  pilot  projects  involving  European  and  Asian  local
authorities  were  awarded  grants  totalling  about  €6 million.  There  was
immediate interest in this programme in China after it became eligible in late
2001,  and  four  projects  were  approved  for  funding  there.  The  Intellectual
Property Rights Programme with ASEAN also saw its budget increased by
€2.5  million  in  order  to  strengthen  Vietnamese  participation  and  include
Laos and Cambodia.

EU-Asia  cooperation  in  the  field  of  higher  education  received  a  boost  in
2002  with  the  publication  of  a  first  call  for  proposals  under  the  Asia-Link
programme. Some 44 projects involving 177 higher education institutions in
Europe and Asia were granted funding of €12.2 million. Late in 2002, a call
for  proposals  was  launched  under  the  ASEAN-EU  University  Network
Programme.

Asia-EcoBest,  with  an  EC  contribution  of  €8.0  million,  is  a  five-year
programme  (1997-2002)  aimed  at  assisting  European  companies  to  pursue
industrial  sector  environmental 
in
cooperation with Asian partners. Project funding for more than 170 measures
has  raised  environmental  awareness  and  helped  introduce  European  best
practices  in  Asia.  A  successor  programme,  Asia  Pro-Eco  (EC  contribution
€31.5 million), was launched in 2002.

investment  opportunities 

in  Asia 

The  EU–India  Civil  Aviation  Programme,  with  an  EC  contribution  of
€18 million,  promotes  cooperation  between  European  and  Indian  industry
and  regulatory  authorities  in  the  fields  of  aviation  safety,  air  transport
infrastructure development and aerospace industry collaboration. A review in
2002  found  the  programme  to  be  largely  on  track  with  good  potential  for
mutual benefits for Indian and European industries.

The  regional  EU-Asian  Civil  Aviation  Cooperation  Project,  with  an  EC
contribution,  of  €15  million  aims  to  enhance  aviation  safety  in  the  region.
The project runs from 2002 to 2006.

209

– 

Poverty Alleviation

It is estimated that up to 1 billion people in Asia live in poverty. While many
governments  have  embarked  on  poverty  reduction  strategies  promoting
economic growth and addressing ingrained inequalities, institutional failures
and  social  barriers,  the  region  has  also  been  beset  by  risk  factors  that  have
disproportionately affected the poor. In recent years, some countries, mainly
in East Asia, have experienced a major financial crisis, while other countries
in the region such as India, with the Gujarat earthquake, suffered devastating
natural  disasters.  East  Timor,  Indonesia,  Nepal  and  the  Philippines
endured civil conflict, while the spread of diseases like HIV/AIDS became a
major concern throughout the region. Progress to-date in alleviating poverty
in Asia has been uneven. Income poverty in East Asia has fallen steadily and
is now estimated at below 15% of the population. The case of South Asia is
less favourable and while poverty is being reduced here too, it still remains
high, at some 30% of the population.

Against this background, the EC’s contribution to poverty alleviation in Asia,
in  line  with  the  Millennium  Development  Goals,  has  focused  on  four  main
themes,  namely  basic  education,  primary  health  care,  mixed  rural/social
development and environmental protection. Twenty poverty-focused projects
were completed in 2002. Evaluations suggested that many projects had over-
ambitious  or  unclear  objectives  from  the  outset.  While  these  shortcomings
were corrected during implementation, project outcomes were, at times, less
than  optimal  due  to  inadequate  government  commitment,  an  inappropriate
policy  environment  and  institutional  weaknesses.  The  limitations  of  the
project  approach  were  again  confirmed,  further  justifying  the  EC’s  move
towards  sector-wide  approaches  built  on  stronger  local  ownership  and
enhanced  government-donor  coordination.  The  Pakistan  Financial  Sector
Reform  Programme  (€50  million)  approved  in  2002  is  an  example  of  this
change in approach.

– 

Rural/Social development

Rural poverty in Asia is characterised by uneven availability and quality and
inequitable  access  to  social  services,  land  tenure  problems,  poor  market
organisation and unfavourable prices for smallholders, and inadequate access
to micro-finance. The problem is compounded by environmental degradation
as  the  poor  are  forced  to  farm  in  stressed  marginal  lands,  for  example,  in
uplands  and  coastal  areas.  In  the  light  of  government  priorities  and  the
activities of other donors, the EC has addressed several of these issues. The
following  are  examples  of  important  projects  completed  or  evaluated/
reviewed in 2002.

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Bangladesh - Empowering the poor to become environmental stewards through the
Synergy Foundation

Under the project Empowering the poor to become environmental stewards, the EC has
assisted the Synergy Foundation with a grant of €650.000 for a five year period to set
up an innovative approach to sustainable forestry, bringing together the landless poor
and  the  private  sector.  The  Synergy  Foundation,  a  UK  based  charitable  green  and
ethical  investment  company  that  has  been  pioneering  this  pro-poor  reforestation
methodology  in  Bangladesh  since  1994,  has  piloted  an  “Environmental  Stewardship
Contract Team” which is a  tripartite  production-sharing  agreement  of  between  35  to
60 years with an absentee land owner and local landless people.

The  model  is  proving  to  be  successful  because  the  landless  people  who  care  for  the
newly planted trees are empowered as members of society who can demand their rights
to  services  such  as  corruption-free  banking,  fair  market  access  and  transparent  local
government. A share of their profits goes to the local administration which encourages
them to vote for candidates who will  best  represent  their  interests.  In  the  Chittagong
Hill Tracts, an ethnically fragile corner of Bangladesh, where the project is expanding
its  operations,  this  model  is  ground-breaking  as  it  is  a  novel  approach  to  solving  the
problem of land ownership by the indigenous people of the area.

As  the  trees  and  crops  start  to  mature,  the  Synergy  Foundation  is  starting  to  set  up
exciting  new  partnerships  with  the  private  sector.  A  Bangladeshi  company
manufacturing  matches  has  signed  an  agreement  and  negotiations  are  on-going  with
others  including  a  large  fruit  juice  manufacturer  in  Bangladesh.  Research  into  the
possibility  of  growing  medicinal  plants,  using  local  knowledge,  is  also  underway.  A
move  to  producing  such  crops  means  high  value  produce,  easier  transport  and  less
vulnerability to looting.

Under  the  2002  monitoring  mission,  the  project  received  the  highest  marks  and  a
strong recommendation by the  monitoring team that this  approach should be further
supported  beyond  its  term  of  February  2004.  Partnerships  between  governments,
business  and  civil  society  were  declared  to  be  a  key  instrument  to  deliver  the
commitments  made at the Johannesburg  World  Summit  on  Sustainable  Development
and  the  project  model  is  an  excellent  example  of  such  a  partnership  between  the
private sector and the poor.

The  Kerala  Horticulture  Development  Programme  (KHDP)  in  India,
began in 1993 as a joint effort between the Government of Kerala and the EC
to  enable  farmers  to  obtain  higher  incomes  by  increasing  the  production  of
high-value horticultural crops. The project was planned with EC funding of
€28.7  million  in  a  total  project  cost  of  €36.7  million.  Through  the  project,
about 37 500 farmers were organised into 1 666 Self-Help Groups, covering
an  area  of  14 230  hectares  spread  over  7  districts.  Around  800  Self  Help
Groups  operating  through  78  farmer-managed  markets  had  a  turnover  of
€6.4 million.  Crop  loans  for  €26  million  have  been  disbursed  with  90%
recovery.  As  a  result  of  KHDP  interventions,  75%  of  farmers  have
substantially  increased  their  income.  The  Nadukarra  Agro-Processing
Company  (NAPC)  which  has  been  part  of  the  project,  has  been  able  to
establish itself as a product brand in Kerala. The NAPC is the first factory in
Kerala to have been awarded ISO certification.

211

A Rural Social Development Programme in Pakistan (€25 million) helped
improve  the  socio-economic  conditions  in  rural  areas  of  Pakistan  by
expanding  the  capacity  of  seven  NGOs  to  deliver  social  services  on  the
ground.  In  a  country  where  most  social  services  have  traditionally  been
provided  by  government,  this  programme  uses  NGOs  to  civil  society  to
expand and improve the provision of such services through civil society. To
date  311  projects  directly  or  indirectly  affecting  up  to  three  million  people
are  being  implemented  across  Pakistan  in  the  areas  of  primary  health  care
including  sanitation  and  water  supply,  basic  education  and  reproductive
health.

The  Support  Programme  for  the  Agricultural  Sector  (PRASAC-II)  in
Cambodia,  which  was  the  subject  of  a  mid-term  evaluation  in  2002,  is
addressing  the  problem  of  rural  poverty  in  26  target  districts  across  six
provinces through  a  range of  agricultural  and  social development  activities.
The  project  was  found  to  have  a  high  level  of  beneficiary  participation  in
planning  and  in  implementation  while  benefiting  over  85 000  households,
most  of  whom  are  among  the  poorest  of  rural  dwellers.  The  multiplier
potential is considerable but more time and resources would be required.

According  to  the  end  of  project  review  in  2002,  the  Central  Cordillera
Agricultural  Programme  (CECAP),  located  in  one  of  the  poorer,
mountainous  regions of the  Philippines,  made  an  important  contribution  to
the promotion of improved farming and natural resources practices designed
to  reinforce  traditional  indigenous  agricultural  systems.  It  is  estimated  that
7 500 farmers  in the 25 municipalities covered by  the  project  have  adopted
improved  farming  methods,  bringing  about  significant  increases  in  their
production, food security and incomes. Another 8 000 farmers have planted
2.4  million  trees  and  have  carried  out  other  improved  natural  resource
management  practices  that  will  help  curb  environmental  degradation  in  the
Cordillera.  The  Project  was  also  instrumental  in  setting-up  many  new
“peoples’  organisations”  and  boosting 
the  membership  of  existing
organisations. Much remains to be done by central and local  government to
ensure the replication of actions initiated under the programme.

In Nepal, the Strengthening of Veterinary Services for Livestock Disease
Control  Project  closed in September  2002,  having eradicated  rinderpest  in
Nepal, an achievement officially confirmed by the Office Internationale des
Epizooties (OIE). Other achievements nation-wide include the enactment of
animal  health  legislation,  the  strengthening  of  field  veterinary  services,  the
setting up of a surveillance system, manpower development and training and
improvements  in  quantity  and  quality  of  vaccine  production.  The  EC
contribution was €8.7 million.

– 

Health

Health services in Asia are faced with a dual burden of disease, as the effects
of rising  prosperity e.g.,  cancers  and  cardio-vascular  pathologies, are  added
to the traditional maternal and childhood illnesses and malaria, prevalent in
pockets  across  the  region.  HIV/AIDS  is  gaining  a  foothold  in  several
countries.  Working  increasingly  through  sector  programmes,  the  EC  is

212

supporting health sector actions in virtually every country of the South Asia
and South East Asia regions.

The  Regional  Malaria  Control  Project  (€32  million  EC  contribution)  in
Laos,  Cambodia  and  Vietnam  was  finalised  in  2002.  The  wide-ranging
activities in country programmes, particularly Impregnated Bed Nets (IBN),
and  Early  Diagnosis  and  Treatment  (EDAT),  backed  by  the  regional
component,  significantly  reduced  malaria  infection  rates  in  these  countries.
In project areas in Cambodia, malaria morbidity dropped from 170 387 cases
in 1997 to 73 149 cases, (i.e. a reduction of 57%) and mortality from 865 in
1997  to  211  (i.e.  a  reduction  of  over  75%).  In  Laos,  with  235 781  treated
bed-nets distributed by the end of the programme, the impact of the activities
is  reflected  in  the  reduction  of  malaria  mortality  reported  in  hospitals  and
malaria morbidity; both have been  reduced by  more than  90%  compared  to
data available at the start of the programme.

Additionally,  various  communication,  information  networking  and  public
education  instruments  set  up  under  the  EC  regional  component  to  foster
collaboration between civilian and military health care systems culminated in
the establishment of a National Ethics Committee in Cambodia and Laos that
will set ethical standards and approve all future proposals for health research
in those countries.

The occurrence of Malaria has dropped remarkably in Vietnam

In the past five years, Vietnam has carried out an EC Malaria Project in the country’s
remote areas, particularly mountainous regions. As well as supplying malaria drugs to
remote areas, the EC provided the Institute  of  Malaria  Parasitology  and  Entomology
with  preventive  drugs,  and  equipment  to  research  potential  cures  for  malaria.  The
project  also  set  up  ongoing  prevention  programmes,  publicising  the  importance  of
controlling the disease. Since 1998, the incidence of malaria has dropped remarkably,
decreasing  the  number  of  deaths  caused  by  the  disease  in  the  eight  worst-affected
provinces in Vietnam.

According  to  Deputy  Health  Minister  Nguyen  Van  Thuong,  infection  rates  are  down
62%.  Since  1997,  deaths  from  malaria  have  fallen  from  152  to  26  in  year  2002,  a
reduction of 83%, and no epidemic has been reported in the eight provinces during the
project’s  five-year  term.  In  Binh  Phuoc  province,  the  number  of  cases  has  fallen  by
79%, and in Lam Dong province the figure decreased by 25%.

the  1994 

Following 
International  Conference  on  Population  and
Development  (ICPD)  in  Cairo,  the  Reproductive  Health  Initiative  in
Asia147  (EC  contribution  of  €25  million)  was  adopted  in  1996  to  address
issues of sexual and reproductive health, regarded as a major determinant of
sexual  behaviour  and  reproductive  choices.  To  date,  special  strategies  have
been formulated for all participating countries, with a varying focus:

– 

community  participation  in  full  reproductive  health  services:  Nepal
and Pakistan;

147

http://www.asia-initiative.org/rhi.html

213

                                                
– 

adolescent  reproductive  health:  Cambodia,  Laos,  Sri  Lanka  and
Vietnam;

– 

improved quality of reproductive health care: Bangladesh.

In  total  some  42  projects  were  undertaken,  39  at  national,  and  three  at
regional  level.  Programme  activities  covered  the  promotion  of  gender
awareness  and  capacity  building.  A  unique  feature  of  the  Initiative  is  its
strategy to involve international, regional and local non-profit organisations
in its implementation and to have these partners (over 80 partners in Asia and
Europe) work together towards a common goal. The final evaluation in 2002
confirmed  the  relevance  of  these  activities  while  recommending  that  a
successor  programme  should  place  special  emphasis  on 
targeting
reproductive health awareness for adolescents.148

The  Health  and  Family  Welfare  Sector  Development  Programme  (SIP)
in India, with an EC contribution of €240 million, is currently in its fourth
year  of  implementation.  Overall  24  states  in  India  are  covered  under  the
programme  with  a  total  disbursement  to  date  of  €93.5  million.  The
programme  aims  at  addressing  systemic  issues  in  order  to  improve  the
availability, accessibility and quality of public primary health care services,
essentially  for  the  poor  and  disadvantaged  in  rural  areas  as  well  as  slum-
dwellers in selected urban  areas.  An  annual  review  was  carried  out  in  May
2002,  which  recommended  that  the  implementation  strategy  be  revised  to
place  a  stronger  emphasis  on  state  facilitation  and  focus  on 
the
decentralisation  and  delegation  of  powers  to  the  lower  tiers  of  the  health
system. Community participation will be enhanced through the involvement
of local government bodies and NGOs, as recommended in the review.149

In  Vietnam,  the  mid-term  review  of  the  Health  Systems  Development
Programme  (EC  contribution  €27  million,  out  of  a  total  project  cost  of
€34 million)  indicated  that  the  Programme  had  succeeded  in  a  number  of
areas  and  shown  weaknesses  in  others.  As  a  result  of  the  review  the
programme  was  revised  and  extended  by  18  months  (to  year  2006).  The
achievements  included  improvement  of  health  infrastructure,  training  of
Vietnamese  health  workers,  the  promotion  of  twinning  arrangements
between  secondary  medical  schools  in  Vietnam  and  similar  institutions  in
Europe, and medical curriculum development. By contrast, the review found
the  programme  targets  overly  ambitious  and  suggested  a  re-design  to  take
into  account  the  changing  medical  environment.  The  programme  was
encouraged  to  improve  coordination  with  other  donors  and  pay  more
attention to gender issues.

148

149

See Annex on case study in Vietnam “Boosting Condom Usage”
See Annex on case study in Indonesia “Social Safety Net/Contraceptive Supplies”

214

                                                
– 

Education

In  some  East  and  South  East  Asian  countries  government  investment  in
education over the past three decades has been well in excess of that in other
developing  regions.  The  countries  of  South  Asia,  on  the  other  hand,  faced
with  massive  population  pressure  and  slower  economic  growth  rates,  have
lagged behind. Lack of investment has manifested itself, inter alia, in lower
enrolment and high  dropout rates  in  primary education,  especially  for  girls,
poorly  trained  and  inadequately  paid  teachers  and  shortage  of  books  and
other  scholastic  materials.  The  EC  has  a  portfolio  of  some  €600  million
under way in support of basic education  across the region,  the bulk of  it  in
the countries of South Asia.

improved  access 

to  primary  schooling 

EC  support  to  the  District  Primary  Education  Programme  (DPEP)  in
India  came  to  a  close  in  December  2002.  The  EC  was  the  first  external
agency to make a financial commitment to DPEP of €150 million, beginning
on a  small scale in  42  low female literacy  districts  in  seven states of  India.
Over time, with the participation of other external agencies, the programme
expanded  to  cover  more  than  270  districts  in  18  states  of  India,  attracting
external investment of nearly  €2 billion. Evaluation findings reveal that the
DPEP  significantly 
in  all
18 participating states, even in remote and isolated hamlets. Over 86 000 new
schools,  most  of  them  alternative  schools,  were  opened  for  first  generation
learners.  Over  1  million  teachers  and  3  million  community  members  were
trained. The DPEP has also helped narrow the gap in enrolment, dropout and
learning  achievement  between  gender  and  social  groups.  School  attendance
rates in rural areas increased from 55% in 1992-93 to 75% in 1998-1999 for
girls aged 6-10 and from 75% in 1992-93 to 83% in 1998-1999 for boys. An
EC  evaluation  of  its  support  to  DPEP  in  the  states  of  Madhya  Pradesh  and
Chhattisgarh  revealed  that  programme  targets  had  generally  been  met.  In
Madhya  Pradesh,  the  gross  enrolment  ratio  increased  from  73%  to  99%
during  the  programme  period.  The  Education  Guarantee  Scheme  model
developed by the Government of Madhya Pradesh, whereby the government
provides schools and trains local teachers on the basis of community demand
and a joint contribution, has succeeded in bringing primary schooling to the
remotest  parts  of  the  state,  and  has  since  been  adopted  as  a  national
programme.

215

Primary Education Centre in India: an evaluation

The final evaluation of the €150 million District Primary Education Programme (DPEP)
in  India  concluded  that  quantitative  targets  were  all  met  and  in  some  cases  even
exceeded but that more attention had been given to access at the expense of access plus
quality.  It  also  noted  that  the  impact  of  EC  support  for  capacity  building,  technical
assistance, monitoring and evaluation could have been significantly enhanced. Overall,
however, the programme has proven to be both technically and financially sustainable
as illustrated by the figures below.

The  objective  of  the  project  was  to  support  the  efforts  of  the  Government  of  India
(GOI) to increase access to quality  primary  education,  especially  for  girls,  in  selected
States and districts in the country (essentially Madhya Pradesh and Chhattisgarh).

The EC contribution was €150 million (€143.5 million to support the education budget
of  the  2  beneficiary  states,  €6.5  million  for  EC  support  activities  (programme
coordination,  reviews  and  evaluation,  capacity  building,  training,  fellowships).  The
Financing  Agreement  was  signed  in  December  1993.  The  original  completion  date  of
June 1999 was extended to December 2002.

The gross access ratio for primary schooling rose from an average of 77.4% in 1996 to
100%  in  1999  in  Madhya  Pradesh  and  from  86.4%  in  1996  to  98%  in  2001  in
Chhattisgarh.  The  gross  enrolment  ratio  (GER)  of  6-11  year  olds  in  Classes  1-5
increased  from  76.7%  to  96.5%  in  Madhya  Pradesh  and  from  88%  to  101.5%  in
Chhattisgarh. The drop out rate in primary schools has been reduced to less than 10%,
with the reduction in dropout being higher among girls.

Gender  and  social  disparities  in  primary  education  enrolment  have  been  reduced  to
less  than  5%  in  DPEP  districts  in  both  states.  The  equity  index  in  Madhya  Pradesh
primary school GER has risen for girls to 97.3, for scheduled caste and scheduled tribe
children to 98.2 and 99.8 respectively. In Chhattisgarh, social disparities in enrolment
have  been  reduced  from  12.7%  in  1996  to  1.2%  in  2000  between  tribal  children  and
other  groups,  and  from  7.3%  to  1.5%  between  caste  children  and  other  groups.  The
gender enrolment disparity has been reduced from 7.8% in 1996 to 51.8%  in Class 1
language  and  from  12.5%  to  54.3%  in  Class  1  mathematics,  with  similar  ranges  in
Class 4. Similar improvements in achievements have been noted in Chhattisgarh.

Adults  (15+  years)  literacy  rates  in  Madhya  Pradesh  are  estimated  to  have  increased
over the last decade from 44.2% in 1991 to 64.1% in 2001 – a rate of increase which is
over 50% higher than the national rate.

In the light of these substantial achievements, a second phase of the programme (Sarva
Shiksha  Abhiyan  Programme  (SSA)  (€200  million)  has  started,  focusing  on  the
elementary education sector. A first tranche was released in December 2002.

216

Female Teachers in Bangladesh

PROMOTE  (Programme  to  Motivate,  Train  and  Employ  Female  Teachers  in  Rural
Secondary Schools in Bangladesh)

The objective was to facilitate the transition to a more gender-sensitive and equitable
society  in  rural  Bangladesh  by  promoting  more  girl-friendly  secondary  schools  and
gender-sensitive  teaching.  The  EC  contribution  was  €36  million.  The  Financing
Agreement was signed in January 1996. Completion date will be December 2005.

The  goal  of  PROMOTE  is  to  support  the  Government’s  policy  of  increasing  the
proportion  of  professionally  trained  women  teachers  in  secondary  schools  in
Bangladesh  from  10%  to  30%.  To  achieve  this,  PROMOTE  provides  one-year
fellowships  for  approximately  7000  women  graduates  to  enable  them  to  study  for  a
Bachelor  of  Education  Degree  at  a  governmental  teacher  training  college  in  the
country.  PROMOTE  supports  employment  of  the  trained  women  teachers  by
subsidising  the  cost  of  their  salary  during  the  first  3  years  of  their  employment  and
providing incentives to schools employing female teachers. It also subsidises the cost of
more than 150 hostels all over the country designed to enable women teachers to take
up teaching jobs in schools away from their home. PROMOTE also provides assistance
to teacher training colleges for measures such as the development of resource centres
designed to improve the quality and gender-sensitivity of their teaching.

The  mid-term  review  concluded  that,  after  the  rather  difficult  starting  phase,
PROMOTE had developed substantial momentum and impact in its goal of increasing
the number of qualified women teachers in rural secondary schools but that stage one
had  mainly  benefited  women  who  were  already  teaching  even  if  they  did  not  have  a
Bachelor’s  Degree  in  Education.  As  a  result,  PROMOTE  will  now  focus  more  on
educating  fresh  graduates  for  newly  created  teaching  positions.  The  Government
agreed  that  during  stage  two,  at  least  2/3  of  PROMOTE  teachers  should  be  fresh
graduates  and  promised  to  make  the  necessary  provision  in  its  budget.  The  review
analysed  and  confirmed  future  demand  for  hostel  accommodation  among  women
teachers  and  recommended  that  PROMOTE  should  better  match  and  publicise
employment  and  hostel  accommodation  opportunities  for  women  teachers  in  future.
PROMOTE  liaison  officers  at  Ttacher  training  colleges  are  being  more  actively
involved.  The  review  also  recognised  the  need  for  sustained  efforts  to  improve  the
quality  and  gender-sensitivity  of  education.  European  technical  assistance  has  been
strengthened to work on this with Teacher Training Colleges.

In  Pakistan,  the  EC  financed  a  four-year  pilot  project  to  combat  the
exploitation  of  child  labour.  This  ILO-executed  project  (EC  contribution
€900 000 of a total €1 728 000) was completed in August 2002. Specifically
targeting  hazardous  industries,  the  project  aimed  to  remove  children  from
bonded labour and rehabilitate them through education. Some 1 000 children
received education in the 18 centres set up by ILO. This pilot project had to
be  partially  re-designed  during  implementation,  which  reduced  its  expected
impact, but provided valuable lessons for an expanded programme in 2003.

–  Macro-economic policies

Approval  was  given  in  2002  for  a  €50  million  EC  contribution  to  the
Pakistan  Financial  Services  Sector  Reform  Programme,  designed  with
the  overall  objective  of  improving  local  livelihoods  by  providing  financial
services to the rural poor, and for the development of SMEs,. The bulk of EC
assistance  is  to  be  disbursed  in  the  form  of  budgetary  support,  and  a  first
tranche of €10 million was released in 2002. The purpose of the programme
is  to  establish  a  transparent  and  predictable  regulatory  framework  and
enhanced environment for effective financial services provision.

217

– 

Environment

Environmental concerns  are  systematically  addressed  either as  a cross-cutting  issue
or  by  means  of  environmental  sub-components  incorporated  in  EC-funded  rural
production and infrastructure projects throughout the region. In addition, a number of
projects  specifically  targeting  environmental  concerns  are  under  way  in  South  and
South East Asia. The South East Asia sub-region, for example, has traditionally been
one of the world’s best endowed in terms of biological diversity. This wealth is fast
disappearing  in  the  face  of  population  pressure,  and  a  regulatory  framework
inadequate to ensure conservation and sustainable use of resources.

The  EC-funded  ASEAN  Regional  Centre  for  Bio-diversity  Conservation
(ARCBC),  largely  completed  and  reviewed  in  2002,  is  a  regional  entity,  with  a
network of National Bio-diversity Reference Units (NBRUs) aimed at addressing the
unfolding  crisis  of  bio-diversity  loss  in  the  ASEAN  region.  The  project  has
completed  training  needs  assessments  in  seven  ASEAN  Member  Countries  and
developed  training  modules  and  professional  competency  standards  for  Protected
Area  staff.  Additional  work  is  needed  to  disseminate  these  resources  in  the  region.
The project has initiated and funded more than 50 research projects, all of which are
still ongoing. The outcome will enhance research capabilities in the region, but more
emphasis is needed to make the research relevant to cross-border, multi-country and
ASEAN-wide  issues.  The  long-term  financial  sustainability  of  the  institutions
responsible  for  bio-diversity  conservation  is  not  yet  secured  and  consequently,
innovations  in  the  area  of  protected  area  financing  will  be  needed  if  meaningful
progress is to be made.

The Palawan Tropical Forest Protection Project (PTFPP) in the Philippines was
the subject of a Pre-Completion Review  (PCR) in 2002. According to findings, the
project  completed  a  land-use  zoning  throughout  the  province  of  Palawan  and  has
established  Geographic  Information  System  (GIS)  capabilities  within  the  relevant
Government  Offices.  It  has  also  conducted  an  effective  Environmental  Awareness
campaign  and  trained  elementary  and  secondary  schoolteachers  in  integrating
environmental  messages  into  their  curriculum.  The  project  also  implemented
514 micro-projects  relating  to  forestry,  agriculture  small  rural  infrastructure  and
livelihood  activities and  assisted  the formation  of 23 community-based  institutions.
However, 
institution-building  of
community organisations, and grassroots participation in the micro-projects have not
been  very  satisfactory.  The  project  meanwhile  has  been  extended  for  a  further  two
years in order to achieve a sustainable impact.

the  socioeconomic 

the  project, 

impact  of 

The  Indonesia  Forest  Sector  Support  Programme  was  completed  in  June  2002.
This  is  a  sectoral  support  programme  aimed  at  updating  national  and  provincial
resource  data  banks  based  on  forest  pilot  sites  and  developing  an  integrated  forest
resource  information  system  to  help  improve  the  capacity  of  land  use  planners  to
monitor the state of the forest and ensure conservation and sustainable management
of the resources. The project, with a total EC contribution of €10.5 million, has only
partly  achieved  the  expected  results.  An  integrated  forest  resource  information
system  has  been  developed,  but  has  not  been  widely  distributed,  and  institutional
shortcomings  meant  that  the  project  was  unable  to  achieve  the  planned  nationwide
coverage during its lifetime.

218

– 

Partnership with NGOs

In  2002,  the  EC  co-financed  38  NGO  projects  in  Asia  with  a  total  value  of
€54.8 million; the aggregate EC contribution was €31.9 million. The projects ranged
from  integrated  rural  development,  capacity  building,  and  primary  health  care
including reproductive health, to human rights and the development of civil society.
The  main  beneficiaries  were  India,  with  9  projects,  followed  by  Cambodia,
Bangladesh  and  Vietnam,  with  4  projects  each,  and  Laos,  with  3  projects.
Meanwhile,  NGOs  continued  to  play  a  major  role  as  contractors  or,  in  response  to
calls  for  proposals,  in  implementing  EC  programmes  providing  social  services  or
rehabilitation and support for refugees and displaced people.

6.5.4

The Three Cs (Coherence, Coordination and Complementarity in Asia)

6.5.4.1 Cooperation with Member States and other Donors in Asia

It  is  widely  recognised  that  aid  effectiveness  depends,  inter  alia,  on  strong  donor
coordination.  Co-financing  or  pool-funding  arrangements  makes  such  coordination
all the more  necessary.  In preparing country  strategies for  the Asia region in  2002,
the  EC  stepped  up  its  collaboration  with  bilateral  and  multilateral  donors  alike.
Coordination  with  EU  Member  States  was  given  particular  attention.  The
Commission’s Delegations in the field actively involve Member State representatives
on  the  spot  at  key  stages  in  the  project  cycle  through  mutual  exchanges  of
information, project visits and debriefings. Vietnam is regarded as a good example of
how donor coordination can work in practice.

Vietnam, an example of coordination

Vietnam  has  been  selected  by  the  Commission  as  one  of  four  pilot  countries  (the  others  being
Morocco,  Mozambique  and  Nicaragua)  for  an  initiative  on  Coordination  of  Policies  and
Harmonisation of Procedures, following the Conclusions of the Barcelona European Council in
March 2002.

A Commission team visited Hanoi at the end of September 2002 to launch the initiative. One of
the  mission’s  main  findings  was  that  coordination  among  the  donors  in  general  continues  to
improve,  while  the  EU  had  stepped  up  its  own  internal  coordination.  In  a  wider  context,  the
Like-Minded  Donor  Group  (a  group  of  seven  donors,  four  of  them  EU  Member  States)  is
instrumental  in  Vietnam  in  improving  management  of  ODA  and  harmonising  activities.  The
formal  donor/Government  coordination  fora  are  the  Consultative  Group  Meetings  (CGMs),
chaired  by  the  Government  and  the  World  Bank  (bringing  together  some  50  bilateral  and
multilateral donors), and Development Partnerships Groups.

219

EU coordination in Vietnam operates in four main areas:

– 

– 

– 

– 

Cooperation:  monthly  meetings,  joint  EU  statements,  common  Directory  of  EU
Cooperation  Activities,  harmonisation  of  local  costs,  aggregate  EU  pledges,  ongoing
strategy dialogue including definition of Country Strategy Papers and National Indicative
Programme, briefings and debriefings for every identification and appraisal mission.

Trade/Economic  relations:  monthly  meetings,  annual  EU  report,  joint  EC/EU  Member
States  support  for  the  European  Business  Information  Centre  (EBIC),  a  programme
designed to disseminate trade related information to both local and European business.

Human  Rights:  monthly  meetings,  exchange  of  information,  local  Troika  meetings  and
missions, joint EU statements.

Culture and EU Visibility: monthly meetings, joint actions, cultural events organised by
Member States publicised on the Delegation Web-site, with an EU Film festival every two
years.

Progress notwithstanding, both the EC and Member States recognise that coordination could be
further  strengthened,  particularly  as  regards  harmonisation  of  procurement  and  programme
evaluation procedures.

6.5.4.2 EIB activities

The European Investment Bank, a policy-driven EU financial institution, participates
actively  in  EU  development  and  cooperation  policy  in  Asia.  It  provides  long-term
loans  for  projects  of  mutual  interest  to  the  beneficiary  country  and  the  EU  and  its
loans are guaranteed by the EU budget.

In 2002, the EIB provided Sri Lanka with an €40 million global loan to finance small
and medium scale projects. It also granted an €49.5 million loan  for the  Telkomsel
Project (Expansion of mobile communications network) in Indonesia.

6.5.4.3 ECHO

A range of humanitarian crises affected Asia in 2002 Asia. ECHO’s strategy was to
adapt  its  operations  to  specific  situations,  as  a  regional  approach  is  usually
inappropriate. It intends to continue this policy approach in 2003.

In East Timor ECHO provided €1.94 million to link emergency, rehabilitation and
development  aid  and  prepare 
the  country  following
independence.  In  Indonesia,  ECHO’s  activities  focused  on  the  needs  of  those
affected  by  the  unrest  in  the  Moluccas,  Sulawesi  and  central  Kalimantan
(€3.5 million).

its  withdrawal  from 

In  Burma/Myanmar,  ECHO  provided  €3.5  million  for  ethnic  minorities  and
internally displaced persons and  €8  million  for  Myanmar  refugees  in  camps  on  the
Myanmar/Thai  border.  In  Sri  Lanka,  humanitarian  operations  were  focussed  on
displaced persons and on victims of the internal conflict.

In India, ECHO financed operations worth €5 million to help victims of community
riots  in  Gujarat  and  people  affected  by  the  conflict  in  Jammu  and  Kashmir,  and
allocated  a  further  €8.3  million  to  provide  Sri  Lankan  refugees  from  Tamil  Nadu
with basic facilities.

In  Nepal,  ECHO  granted  €3.7  million  for  Bhutanese  refugees  and  victims  of  the
internal  conflict.  In  Cambodia,  humanitarian  projects  worth  €5.5  million  targeted
conditions in the poorest regions and the plight of returning refugees.

220

A  total  of  €73.3  million  of  assistance  was  granted  for  Afghanistan,  Pakistan  and
Iran.  Humanitarian  operations  focused  on  Afghan  and  Pakistani  victims  of  the
drought,  the  permanent  return  of  Afghan  refugees  from  Iran  and  Pakistan,  and
victims of the earthquakes in Iran and Afghanistan.

In  North  Korea,  ECHO  committed  a  total  of  €21  million  for  the  most  vulnerable
people,  especially  children  and  the  sick,  and  flood  victims.  In  China  €4.5 million
was also allocated for relief to victims of snowstorms and flooding.

ECHO adopted an €3.5 million action  plan under its  regional disaster preparedness
and  prevention  programme  (DIPECHO)  for  South-East  Asia  with  the  aim  of
strengthening  the  capacity  of  local  communities  and  institutions  to  respond
effectively to regularly recurring natural disasters.

European Community Humanitarian Office’s (ECHO)
Financing Decisions 2002

Country

Afghanistan/Pakistan/Iran

North Korea

Sri Lanka

Cambodia

Thailand

India

China/Tibet

Nepal/Bhutan

Indonesia

Burma/Myanmar

DIPECHO Action Plan for S.E. Asia

East Timor

Vietnam

Laos

€ million

73.25

21.02

8.30

5.50

5.46

5.00

4.45

3.67

3.54

3.50

3.46

1.93

1.19

1.13

6.5.5

Results-Oriented Monitoring

Total

141.40

In 2002, a total of 95 monitoring visits were made to 79 projects in 13 countries in
the  Asia  region.150  The  breakdown  of  projects  visited  by  area  of  cooperation  is
presented in Table (below).

150

Monitoring of regional programmes and projects entails the visit of several components, resulting in the
production of more than one report for a single programme or project

221

                                                
Projects by area of cooperation in Asia

2002

Number
of
Reports

Number of
Programmes

Total budget
(€) million

Average size
(€) million

1

2

Trade and Development

Regional Integration

3 Macroecon. and Social

4

5

6

Services

Transport

Food Security and Rural
development

Inst. capacity and good
governance

7 Other (Urban development )

Total

2

18

20

3

38

13

1

95

2

3

19

3

38

13

1

79

6.1

52.3

484.9

34.0

492.5

96.0

5.6

1193

3.0

17.4

25.5

11.3

12.9

7.4

5.6

111

Average ratings for monitoring criteria in Asia, by Priority Areas

Trade &
Dev.

Regional
Integ

Macro-econ.
and Social Transport

Institutional &
Cap. Bldg

Relevance

Efficiency

Effectiveness

Impact

Sustainability

Average

3

2.5

3

2

2.5

2.6

2.3

2.7

2.6

2.6

2.9

2.6

2.5

2.4

2.9

2.7

2.6

2.6

3.3

3.6

3.3

3

3.6

3.3

2.7

2.5

2.7

2.3

2.6

2.5

Education – a key to poverty reduction

Bearing  in  mind  the  EC’s  overarching  goal  of  poverty  reduction,  results  of  projects  in  the
education  sector  are  particularly  encouraging.  The  average  performance  score  of  2.74  for
education programmes (based on a sample of 12 reports – €188 million) compared to an average
of 2.64 for all projects in Asia, confirms the potential for high impact in this sector. This positive
trend notwithstanding, social sector budgets are constantly under threat and adequate levels of
public expenditure remain a priority in the EC’s policy dialogue with partner countries.

The overall conclusion from monitoring missions in 2002 is that the performance of
projects and programmes in the Asia region is globally positive. Useful lessons have
been  learned  and  quality  improvement  measures  are  constantly  being  updated.
Findings to date highlight  the  importance  of  the  twin  factors  of  project/programme
relevance  and  design  as  the  key  to  successful  outcomes.  Linked  to  the  devolution
process,  quality  improvement  measures  have  been  put  in  place,  namely  the
intensification of training on project cycle management and the screening of projects
from the early stage of identification, with the aim of  ensuring more robust project
preparation.

222

In tandem with the wider donor community, the EC is intensifying its dialogue with
partner  governments  in  an  effort  to  encourage  more  strategic  sectoral  policy
approaches in targeting poverty reduction.

6.5.6

Conclusions and Perspectives

Through its cooperation activities, the EC strives to make a contribution to reducing
poverty  and  raising  the  standard  of  living  in  Asia.  The  Community’s  role  also
extends  to  improving  these  countries  relations  with  the  EU,  promoting  greater
democracy and fostering peace. This involves, among other things, helping with the
reconstruction  and  rehabilitation  of  conflict-torn  countries  such  as  Afghanistan  and
East  Timor  and  initiating  conflict-prevention  activities  ,  including  support  for  the
peace process in Sri Lanka. Basic health and primary education are priorities and will
continue to receive at least one third of the available funds from the relevant budget
line. The focus will be on intervention at the sectoral level, fighting poverty through
country-owned  programmes  and  enhanced  donor-country  coordination.  The
allocation  of  aid  funding  should  fully  reflect  the  focus  on  poverty  reduction  in  the
Commission’s Communication on Development Policy,151 with special emphasis on
contributing to the Millennium Development Goals.

Economic cooperation with Asia is in our mutual interest, focusing in particular on
the business environment while strengthening activities in trade facilitation and such
key fields as energy, environmental technology and bio-diversity.

Much more can be done to encourage mutual understanding and the sharing of core
values and to raise the profile of European operators and academics in Asia and visa
versa.  With  this  in  mind,  the  EC  is  committed  to  and  expanding  its  network  of
Delegations  in  the  Asia  region  and  strengthening  their  capacities.152  The  EU’s
regional strategy towards Asia is due to be updated in 2003 to take account of new
challenges  brought  about  by  globalisation  and  developments  on  the  international
political scene.

6.6

LATIN AMERICA

Geographically diverse, with a mix of indigenous and immigrant populations, Latin
America  shares  a  historical  heritage,  similar  values  and  common  languages  with
Europe.  After  years  of  political  instability  and  sub-regional  conflicts,  the  whole
continent,  except  for  Cuba,  is  now  governed  by  democratic  regimes  and  internal
conflicts  have  in  many  cases  given  way  to  peace  processes.  Latin  America  is  also
embarked on regional integration processes (Mercosur, Andean Community, Central
America), backed up by free trade agreements which play a decisive role for  trade,
contributing  to  the  economic  growth  and  development  of  the  region.  Wealth,
however, is unequally distributed both between  and within countries; a total of 200
million  people  are  underneath  the  poverty  line.  Furthermore  this  part  of  the  world,
with  its  exceptional  environmental  riches,  is  also  at  high  risk  from  climatic  factors
and earthquakes.  It is against this complex background that the EU encourages  and

151

152

Communication  from  the  Commission  to  the  Council  and  the  European  Parliament  on  the  European
Community’s Development Policy, COM(2000) 212 final dated Brussels, 26.4.2000
The  EU  currently  has  twelve  Delegations  in  the  region,  in  Colombo,  Dhaka,  Islamabad,  New  Delhi,
Bangkok, Hanoi, Jakarta, Manila, Beijing (plus an Office in Hong Kong), Seoul, Tokyo, and Canberra.
Two of these (Hanoi and Colombo) have been opened since 1994.

223

                                                
assists  regional  actors  in  their  efforts  towards  democratisation,  greater  social
equality, economic integration and preservation of the environment, and helps bring
relief to victims of natural disasters.

6.6.1

Strategic objectives and achievements

In  2002,  the  second  Summit  of  Heads  of  State  and  Government  of  EU,  Latin
American  and  Caribbean  countries  (EU-LAC)  was  held  in  Madrid,  concluding  the
negotiations  for  the  EU-Chile  association  agreement  that  was  formally  signed  in
November,  and  carrying  forward  the  negotiations  between  the  EU  and  Mercosur.
Participants  also  agreed  at  the  Summit  to  negotiate  EU/Central  America  and
EU/Andean  Community  political  dialogue  and  cooperation  agreements.  The
European  Commission  has  already  adopted  a  recommendation  for  a  Council
Decision for each of the two sub-regions authorising it to open negotiations for the
conclusions of the agreements.

The  Madrid  Summit  set  a  number  of  political,  economic  and  cooperation  priorities
for  the  future  of  the  strategic  partnership,  with  a  continued  focus  on  human  rights,
democracy,  regional  integration,  social  cohesion,  and  cooperation  in  multilateral
bodies.

In  2002  a  Memorandum  of  Understanding  was  signed  between  the  European
Commission  and  the  inter-American  Development  Bank,  paving  the  way  for  joint
cooperation projects.

The  analysis  and  programming  of  cooperation  priorities  with  the  Latin-American
continent as a whole and with each country and each sub-region was completed.  In
implementing cooperation, the incorporation of cross-cutting issues continued. Two
of them are of special relevance for Latin America: human rights (Andean region and
Central America) and good governance (in particular Chile, Ecuador and Peru).

The Commission also adopted and forwarded to the Council the proposal for a new
aid  management  regulation  for  Latin  America  and  Asia153  designed  to  bring
procedures into line with the requirements of the overall reform of EU  external aid
management.

153

(COM(2002) 340 final of 2.7.2002)

224

                                                
COMMITMENTS AND PAYMENTS IN 2001 AND 2002
Budget headings B7-310 AND 311 (except line BA and Cuba)

COMMITMENTS

PAYMENTS

(in €)

(in €)

B7-headings 310 /311

Bilateral subtotal

Regional sub total

2002
114 483 623.
41

129 890 753.
99

2001
133 292 500

2002
107 028 048

2001
89 057 812

84 373 500

Aggregate payments and European country payments
(primarily for regional programmes)

32.176.585

35.394.789

BILATERAL/REGION
AL

244 374 377.
40

217 666 000

139 204 633

124 452 601

OVERALL COMMITMENTS AND PAYMENTS LATIN AMERICA 1999-2002
(in € million)

1996

1997

1998

1999

2000

2001

2002 TOTA

Commitments

506.8

484.7

486.4

Payments

263.7

313.9

279.3

425.5

315.7

382.0

3.124.7

L.

421.9

272.4

271.5

2.042.1

418.
7

325.
5

6.6.2

Programming priorities

Programming  for  the  period  2002-2006  (budget  headings  B7-310  and  311)  takes
account of the budget perspectives established.

In relation to the total budget, EU aid can be broken down as follows:

37% for Central America and Mexico

27% for Andean America

17% for the Southern Cone

16% for Latin America (Region)

3% reserve

The programming for Latin America follows a number of broad lines:

– 

– 

the social sector accounts for 56% of programming (according to DAC/OECD
criteria).  This  comfortably  exceeds  the  35%  target,  with  substantial  amounts
for  education,  social  infrastructure,  support  for  disadvantaged  groups  and  the
fight against poverty: these priorities appear in practically all the regional and
national programming documents;

support for  civil society accounts for  a large  share of regional programming
represents  in  particular  (Alfa,  Al-Invest,  Urb-AL  and  @LIS  programmes,
continuing  throughout  the  period),  and  in  the  three  subregional  programming

225

– 

– 

exercises:  Central  America,  Andean  Community  and  Mercosur.  For  some
countries (Guatemala) there is a specific civil society allocation;

institutional  support,  support  for  the  reform  of  the  State  appear  in  the
majority of programming documents: in the Mexico regional document (in the
fight  against  social  inequality  and  support  for  energy  authorities),  in  all  the
Central  America 
sub-regional
programming, and for Colombia and Peru;

and  Mercosur  documents 

including 

support  for  regional  economic  integration,  trade  and  investment  reflects
the  situation  and  needs  of  the  different  countries  and  sub-regions,  with  a
distinction between:

– 

– 

– 

– 

– 

horizontal  programmes 
(programmed in 2001 but continued throughout the period),

like  Al-Invest,  @lis-information  society,

support  for  the  establishment  of  the  free  trade  area  with  Mexico  and
scientific  and  technological  cooperation  (more  then  50%  of  available
funds, i.e. €30 million),

support  for  regional  integration  in  Central  America  (common  customs
system,  policy  harmonisation),  accounting  for  46%  of  available  funds;
for the Central America countries the share is between 10% and 20%,

regional  and  national  programming  for  the  Andean  Community  (except
Colombia, for the time being) comprises an integration and trade section
representing 5% to 33% of available funds,

all  regional  and  Mercosur  country  programming,  more  50%  of  funds
available for this purpose;

at sectoral level:

– 

– 

– 

the  two  sub-regional  programmes,  Central  America  and  the  Andean
Community, and the regional programme,  given the vulnerability  of  the
region,  include  a  section  on  the  prevention  and  control  of  natural
disasters with an aggregate value of nearly €70 million,

the  environment  accounts  for  14%  of  total  programming  (Honduras,
Ecuador, Brazil, Chile),

rural development accounts for the largest share in the Central American
and Andean countries.

6.6.3 Main results in 2002:

The  actions  implemented  come  within  the  framework  of  the  strategy  of  defined
cooperation during the  year 2002 by means of  the  orientation  documents drawn  up
by country and by region.

226

6.6.3.1 Country strategies

The  dialogue  initiated  in  2001  between  the  European  Commission  and  the  Latin
America  countries  (the  Memorandum  of  Understanding  process)  has  improved  the
quality of cooperation with these countries. One-off measures to remedy the lack of
governmental action or resources has given way to joint reflection on priority sectors
for  the  long-term  development  of  each  country  and  how  the  EU  can  contribute  to
governments’ efforts.

Preparation  of  the  programming  documents  was  completed  during  the  year  2002.
The  Commission  adopted  17  national  strategy  documents,  3  subregional  strategy
documents  (Central  America,  Andean  Community  and  Mercosur)  and  a  regional
strategy  document  (Latin  America).  These  documents,  in  accordance  with  the  new
Commission guidelines on external aid, reflect a focusing of priorities and a search
for complementarity with other donors  and take account of  all Community policies
which  affect  the  country  or  the  region  (trade,  agriculture,  fishing,  environment,
research,  etc.)  Each  strategy  includes  multiannual  programming  of  the  activities
carried out by EuropeAid and the EU delegations.

By end 2002 it was clear that as a result of the serious economic, financial and social
crisis  in  Argentina,  the  multiannual  programming  established  in  the  strategic
guidance  paper  was  obsolete.  Consequently  work  was  put  in  hand  on  adapting  the
priority  intervention  sectors  and  this  should  lead  to  a  complete  revision  of  the
strategy paper in 2003.

It proved impossible to make commitments for a sectoral adjustment programme on
export  promotion  for  Paraguay  as  the  conditions  for  the  aid  (adoption  of  suitable
legislation and IMF endorsement of the macroeconomic situation) were not satisfied.
The Commission, closely monitoring developments, reacted quickly to the situation
by  planning  a  conventional  programme  in  this  field  in  place  of  the  sectoral
programme.

6.6.3.2 Implementation

The  two  main  types  of  cooperation  with  Latin  America  are  financial  and  technical
and economic.154 The Commission committed more than the initial appropriation for
the various projects and programmes (€244 374 377 as compared to €239 851 500).

The financial and technical cooperation projects financed by the European Union
in  Latin  America  in  2002  (17  projects;  total:  €123  million)  are  mainly  in  the
following sectors: environment and  rural development, institutional support, private
sector,  health,  education,  underprivileged  groups,  the  rule  of  law  and  regional
integration, plus areas crucial to increasing economic development, in particular the
strengthening of intra-regional trade.

Economic  cooperation  projects  (5  projects;  total:  €121  million)  were  mainly
regional  operations  in  various  fields  such  as  cooperation  between  European  and
Latin-American  SMEs  (small  and  medium-sized  enterprises)  under  Al-Invest  III155

154

155

Budget headings B7-310 and B7-311, respectively.
http://europa.eu.int/comm/europeaid/projects/al-
invest/index_fr.htmhttp://europa.eu.int/comm/europeaid/projects/al-invest/index_fr.htm

227

                                                
(total €46 million), regional integration and higher education under AlBan;156 (total:
€88.5  million,  including  45  millions  committed  in  2002),  and  reinforcement  of  the
Alfa programme;157 (total: €27 million).

– 

Conflict prevention,, good governance and rule of law

In the field of good governance the Integrated programme for good governance and
decentralisation  in  the  Coquimbo  Region  (Chile)  is  designed  to  reorganise  the
activities  of  the  Chilean  government  to  encourage  democratisation  and  good
governance  in  particular  by  greater  decentralisation,  both  from  national  to  regional
and provincial level and from regional to municipal and local level. This forms part
of  a  broader  process  of  encouraging  grassroots  participation.  The  mid-term
evaluation  mission  reached  a  broadly  positive  conclusion  and  the  experience
acquired will be redirected and focused in such a way as to achieve the overall goal.

The  two  multiannual  regional  programmes  (2001-2005)  implemented  in  2001
(totalling  almost  €22  million  from  the  2000  budget)  continued.  Their  aim  is  to
promote  human  rights  and  fundamental  freedoms  in  the  Andean  Community
countries  and  Central  America.  The  various  types  of  activity  under  these
programmes  are  carried  out  by  non  governmental  organisations,  universities  and
independent institutions.

The Colombian Government’s peace process was given a major boost in 2002 with
the  implementation  of  the  Magdalena  Medio  Peace  Laboratory  project  for  socio-
economic  revival  and  poverty  reduction  measures  in  the  area  (EC  contribution:
€34.8 million).

The  sum  of  €904 000  was  committed  to  support  the  Truth  and  Reconciliation
Committee  in  Peru  in  partnership  with  the  United  Nations.  €12  million  was  also
committed for a programme to strengthen civil society in Guatemala.

In  2002  the  European  initiative  for  the  defence  of  Human  rights  (IEDDH)
supported  new  projects  in  central  and  south  American  countries  worth  a  total  of
almost €16 million. Micros-projects will also be implemented in three of the IEDDH
target  countries:  Colombia,  Guatemala  and  Mexico.  The  sum  of  €939 400  was
allocated  to  support  for  conflict  prevention  to  help  stabilise  the  Andean  region  by
supporting  the  adoption  and  implementation  of  a  common  security  policy  and
consolidation  of  the  regional  integration  process.  As  regards  support  for  the
democratisation  process  and  strengthening  of  the  rule  of  law,  the  IEDDH  provided
backing for the democratic transition in Ecuador by sending  a team of observers to
monitor  the  presidential  and  legislative  elections,  and  in  Colombia  it  supported
public  engagement  in  the  electoral  process  and  democratic  controls  on  municipal
representatives.  Support  was  also  provided  for  a  project  setting  up  an  ethics  and
democratic  education  code  in  Ecuador.  A  €600 000  project  in  Venezuela  aims  to
promote  constructive  dialogue  between 
the  government  and  opposition
representatives,  to  provide  electoral  assistance  for  the  organisation  of  free  and  fair
elections  and  to  help  the  process  of  civilian  disarmament.  Under  the  IEDDH  the
Commission  has  devoted  over  €4.8  million  to  8  projects  to  promote  and  defend

156

157

http://europa.eu.int/comm/europeaid/projects/alban/index_fr.htm
http://europa.eu.int/comm/europeaid/projects/alfa/index_fr.htm

228

                                                
human rights and of fundamental freedoms, including three in Colombia (improving
the  prison  system,  promoting  prisoners’  rights,  strengthening  the  office  of  the
ombudsman,  legislation  on  human  rights,  civil  society  training  and  introducing  a
culture of respect for human rights) and one in Mexico. The IEDDH devoted almost
€6  million  to  the  fight  against  racism,  xenophobia  and  discrimination  against
minorities  and  indigenous  people  in  Bolivia,  Colombia,  Guatemala,  Nicaragua,
Ecuador,  Paraguay  and  Peru.  Lastly,  over  €2.3  million  went  to  the  prevention  of
torture  and  support  for  the  rehabilitation  of  torture  victims  in  Argentina,  Peru  and
Chile.

– 

Institutional support

Two institutional support projects were closed upon the completion of operations:
Strengthening  of  democratic  development  in  El  Salvador,  designed  to  improve
administrative  procedures,  and  Reform  of  the  Foreign  Affairs  Ministry  in  Panama
(EC  contribution:  €1  million;  duration:  1  year),  the  aim  of  which  was  to  adopt  a
system of administrative qualifications.

There was no mid-term review of institutional support projects, but activities directed
towards  institution  building  were  consolidated  during  the  year,  in  particular  in  the
fields of justice and decentralisation, to respond more fully to the challenges entailed
in good governance and the rule of law in Latin America.

Two institutional  support  projects were decided in 2002  in  Latin  America:  Support
for  the  reform  and  modernisation  of  the  public  service,  in  Honduras  (EC
contribution:  €4  million),  and  Support  and  modernisation  of  the  administration  of
justice in Mexico (EC contribution: €3.5 million).

In  private  sector,  two  projects  were  finalised,  one  to  set  up  a  national  market
information and social promotion centre  to promote and develop Honduras’  export
trade  by  providing  a  suitable  information  service  (EC  contribution:  €780  000;
duration: 2  years),  and the  other on diagnosis  of shrimp  disease in Ecuador,  in  the
SME sector, to improve shrimp production, research into their diseases, and stability
of employment in the sector. (EC contribution: €980 000; duration 3 years). A mid-
term  review  of  the  project  Regional  development  and  strengthening  of  Argentina’s
provincial  support  structures  for  SME  was  carried  out  in  Argentina.  This  project’s
overall  objective  is  to  improve  the  competitiveness  of  Argentinian  SMEs  in  the
context of a new domestic economic situation and international market opening and
thus  encourage  the  development  of  the  regional  economy.  (EC  contribution:
€3 million; duration 3 years).

The  EC  approved  a  programme  of  support  for  trade  development  and  export
promotion in Bolivia (EC contribution: €6.3 million), its first operation in this sector
in  Bolivia.  In  2002  a  programme  of  support  for  Latin  America  SMEs  was  also
approved, in the form of a €200 000  framework contract with  the Confederation of
European  Senior  Expert  Services  (CESES).  CESES  members  will  provide  training
and advice in support of EC programmes.

With  regard  to  gender  mainstreaming,  the  PROIGUALDAD  (promotion  of  equal
opportunities)  project  in  Panama  (EC  contribution:  €9.8  million)  was  designed  to
improve  the  socio-economic  situation  of  women  in  classes  of  society  and  promote
their participation in political, social and economic development.

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PROIGUALDAD - Promoción de la igualdad de oportunidades - Panama

Thematically  complex  and  with  a  large  number  of  actors,  this  is  the  largest  gender-issues
project carried out in Latin America to date (EC contribution: €9.8 million; duration: 5 years).
It  has  raised  awareness  of  the  gender  issue  throughout  Panamanian  society,  worked  with  the
public sector and civil society in genuine synergy between all actors (39 governmental and non-
governmental  organisations),  created  the  conditions  for  mainstreaming  women’s  issues  and
equal  opportunities  in  public  policy,  education  and  social  organisations  and  improved  the
situation of many women involved in the project through the country.
It is difficult to quantify the results  of  this  important  project, which  successfully  incorporated
the gender dimension into Panama’s education system and a number of legal instruments and
raised public awareness of women’s issues by means of high-impact media campaigns. A large
number  of  awareness-raising  and  training  courses  were  organised;  16  335  persons,  including
3 770  men,  followed  awareness-raising  courses  on  gender  mainstreaming.  Particular  emphasis
was  placed  on  bringing  rural  and  indigenous  woman  into  decision-making  within  the
community  and  involving  them  in  productive  projects  to  improve  the  quality  of  life,  which  in
turn  entailed  provision  of  training  for  literacy  trainers,  including  bilingual  training  for
indigenous communities.
PROIGUALDAD  is  an  important  step  towards  a  fairer,  more  balanced  and  equal  society  in
Panama;  a  unique  gender  project  whose  experience  and  results  could  be  used  in  other
development cooperation initiatives in Latin America or other parts of the world.

– 

Regional cooperation and integration

In the field of regional integration, the European Commission continued in 2002 to
support the integration processes in the three main regions of Latin America: Central
America, the Andean Community and Mercosur.

for 

support 

the  El  Salvador-based  Sistema  de 

Two  experts  were  sent  on  a  three-month  mission  to  Central  America,  to  provide
institutional 
Integración
Centroamericana  -  (Central  American  integration  system  -  SICA  )  (total  cost:
€200 000).  A  Financing  Agreement  for  a  customs  project  was  also  signed  between
the EC, SICA and SIECA (Secretaria de Integracion Económica Centroamericana -
Secretariat  for  Central  American  economic  integration),  the  project  headquarters
(cost: €8 million).

In  the  Andean  Community  a  start  was  made  on  two  technical  standards  and
competition law projects (EC contribution: €2 million each) with the adoption of the
project management units.

Three  institutional  support  projects  in  the  Mercosur  region  started  up  after  the
technical  assistance  selection  procedures  were  finalised  (total  EC  contribution:
€2 million).

A  statistics  project  with  the  Andean  Community  was  decided  (EC  contribution:
€5 million).

In  parallel  with  its  bilateral  cooperation  with  Latin-American  countries  or  regional
subgroups, the European Union maintains a regional approach to Latin America as a
whole.  This  regional  cooperation  involves  implementation  of  regional  programmes
open  to  actors  from  the  countries  of  both  regions.  The  evaluation  of  these
programmes is generally very positive, which explains the mobilisation of a greater
share of the financial resources available.

The  ALBAN  Programme  of  high  level  scholarships  adopted  in  spring  2002  was
launched  in  Madrid  at  the  second  EU,  Latin  American  and  Caribbean  Summit.  Its

230

total budget is €113.5 million, including €45 million as the European Community’s
financial commitments in 2002.

Thirty-five  projects  under  Stage  I  of  the  ALFA  higher  education  programme  were
completed  and  70  others  are  continuing.  In  2002,  the  European  Commission
approved  a  second  phase  -  ALFA  II  (2002-2005  -additional  commitment  of  €17
million).

In  2002  the  Member  States  approved  Stage  III  of  the  AL-INVEST  programme,
which will be put in hand from the second half of 2003 (amount: €46 million). The
strength of the AL-INVEST programme lies in the network of operators158 set up to
ensure that activities  run smoothly, consisting of  Chambers  of  Commerce,  industry
federations and other representatives of the private sector.159

At the time of the EU-LAC summit in Madrid, the Caribbean countries asked to be
given access to the @LIS (Information society) programme. This has been done, and
their participation is financed by the EDF.

The rate of participation in the URB-AL (Urban development) programme increased
by  almost  100%  in  2002  thanks  to  the  formation  of  5  new  thematic  networks.
Community  cofinancing  reached  €8.7  million  for  20  projects  selected  in  January
2002, using funds already committed.

– 

Transport and Infrastructure

Some  ten  projects  in  this  sector  were  under  way  in  2002,  the  total  European
contribution being €54 million. Basic infrastructure projects and support for regional
and national integrated resource management initiatives were both stepped up.

Current  water  and  sanitation  projects  continue  to  meet  the  urgent  needs  of  those
communities most vulnerable in respect of water supplies and waste water treatment.
They include water supply and sewage projects in two towns in Bolivia and in rural
areas of Nicaragua, a sewage project for 50 rural communities in Paraguay, and two
projects  on  the  integrated  management  of  the  Rio  Picolmayo  basin  in  Honduras.
Bolivia  again  came  in  for  special  attention  as  a  result  of  measures  undertaken  in
preparation for a future SWAP (sector-wide approach) programme in this sector.

– 

Food security and rural development

No new  Food  security  commitments were made. Programmes  of various types are
under way in 8 countries (either direct aid or via NGOs, Euronaid or FAO); these are
shown in the table in annex alongside the amounts (in € million) managed in 2002.

158

159

Eurocentros (45) in Latin America and COOPECOS (324) in Europe.
Number of recorded trade agreements (until December 2001):306. Value of the trade agreements (until
December 2001):167,700,871. Value of the investment agreements (until December 2001):47,873,402.
Value of the total agreements (until December 2001):215,574,281

231

                                                
Community food security programme in Honduras

To  overcome  poor  people’s  difficulties  in  finding  adequate  access  to  food  and  reduce  the
damage  caused  by  hurricanes,  droughts  and  floods,  the  government  of  Honduras  is
committed to a series of measures to reactivate the economy, with a particular emphasis on
the  rural  sector,  which  is  worst  affected  by  natural  disasters  (e.g.  hurricanes  Mitch  and
Michelle).

Honduras  is  eligible  for  the  HIPC  (Highly  Indebted  Poor  Countries)  initiative,  and  in
December 1999 adopted a poverty reduction strategy involving civil society, with the aid of
the World Bank and the IMF. The emphasis is on a number of persistent problems affecting
rural  areas:  institutional,  technical  and  legal  obstacles  to  the  acquisition  of  land,  lack  of
access  to  credit  for  small  farmers,  shortcomings  in  irrigation  infrastructure  and  problems
relating to technology transfer and the marketing of agricultural produce.

In line with the government’s  poverty reduction strategy, the European Commission’s food
Security  programme  (1999-2004)  focuses  on  three  areas:  land  reform  and  access  to  land,
credit and improvements to the food marketing/processing system:.

Reflecting  the  diversity  of  operations  and  counterparts  (government  and  civil  society),  this
€32  million  programme  includes  direct  aid  (e.g.:  land  reform,  credit  and  seed  production
programmes) and indirect aid (via calls for proposals).

A  mid-term  evaluation  mission  (October  2002)  confirmed  the  expected  results,  namely
strengthening  of  central  and  local  public  institutions  and  increased  food  security  for  the
poorest rural households.

In  the  field  of  rural  development  the  European  Commission  and  Guatemala
financed  4  projects  in  the  Santa  Cruz  del  Quiché,  Totonicapan,  Baja  Verapaz  and
Alta  Verapaz  districts.  The  ALA/Quiché  project  involved  operations  jointly
implemented  with 
associations,
municipalities, Guatemalan government bodies, NGOs and other programmes under
way 
including  support  for  food  production  and
locally.  The  objectives, 
environmental protection, were achieved.

concerned,  producers’ 

communities 

the 

Three other projects in Guatemala with similar objectives and results were finalised:
Totonicapan  (EC  contribution:  €7.5  million),  Alta  Verapaz  (EC  contribution:
€8 million) and Baja Verapaz (EC contribution: €7.5 million).

The Tropisec project in Nicaragua, started in 1997, was finalised. (EC contribution:
€7 million).  The  objectives  were  achieved  and  10 000  families  benefited  from  the
operations.  1 536  running  water  systems  were  installed  and  2 565  family  holdings
and 1 846 km of rural roads were improved. The project was co-financed with IFAD,
the International Fund for Agricultural Development.

In support of the  Bolivian  Government’s  strategy to  eliminate  illegal  coca  growing
activities,  the  EU  carries  out  alternative  development  projects,  mainly  in  areas
buffering migratory flows towards coca production areas. Two mid-term evaluation
missions  to  Bolivia  took  place  in  2002.  Evaluation  of  the  alternative  development
project, PRAEDAC - Programme of support for the Chapare alternative development
strategy, fostering socio-economic development in the coca production  areas of the
Tropic  of  Cochabamba,  formulated  recommendations  as  a  result  of  which  an
extension of the activities was granted until 23 March 2006.

The  second  evaluation  mission  was  for  the  project  PRODEVAT  -  Arque  and
Tapacarí Valley Development Programme, whose general objective is to encourage
the inhabitants of the project area to  stay  in  the region rather  than  migrate to  illicit
crop  areas.  The  mid-term  evaluation  noted  that  the  implementation  schedule  had

232

made  up  considerable  ground  and  recommended  consolidating  high-visibility
(infrastructure) operations and stepping up sustainable long-term impact initiatives.

A  total  of  17  projects  are  being  implemented  in  this  field  (EC  contribution:
€231 million). 2002 saw the consolidation of the facilitadora (facilitation) approach
to  integrated  rural  development.  Two  rural  development  projects  are  under  way  in
Ecuador:  Esmeraldas  rural  development  project  and  Cotopaxi  Province  rural
development (EC contribution: €5 million each).

In  Peru,  the  PRODAPP  -  alternative  development  programme  for  Pozuzo  and
Palcazú started in October 2002 (EC contribution: €21.5 million).

In  2002,  the  European  Commission  approved  four  rural  development  projects
(Honduras,  Nicaragua,  Panama  and  Bolivia).  The  innovative  project  in  the
Department  of  Rivas,  in  Nicaragua  uses  “facilitator”  methodology  rather  than  a
direct project implementation approach. The APEMIN project in  Bolivia in support
of small-scale mining represents is the second stage of a scheme to curb temporary
emigration  of  people  affected  by  the  decline  of  mining  towards  the  coca-growing
region of the Chapare.

Rural development - ALA/Quiché - Guatemala

This  project  in  the  department  of  Santa  Cruz  del  Quiché  (EC  contribution:  €17.5  million;
duration: 7 years), has:
-

provided  strong  support  for  food  production  (cereals,  market-gardening,  fruit  and
livestock-farming),  environmental  protection  (reafforestation,  management  plans  for
protected  areas)  and  various  training  activities  in  the  environmental  and  ecotourism
field;
introduced  new  production  techniques,  marketing  methods  and  facilities  by  providing
support for artisanal production by micro-enterprises whose members received training
on production and services;
strengthened  local  community  institutions  by  helping  them  organise  and  training
community  groupings  and  stock  breeders’,  agricultural  producers’  and  craftsmen’s
associations;
taken account of gender mainstreaming as a cross-cutting element in most activities;
given support to national institutions, communities, municipalities and associations in the
form  of  social,  socio-productive  and  productive  infrastructure  work  with  various
equipment. It has also set up ecotourism infrastructure and  a  geographical  information
system (SIG) to help in land-use planning.
done  more  to  encourage  access  to  formal  credit  by  disadvantaged  groups  (credit  fund
managed by BANRURAL. EC contribution: €2.7 million). BANRURAL has invested €5.2
million of own  resources  in  Quiché  Department,  compared  to  the  €0.6  million  provided
for in the project Financing Agreement.

Several radio and TV programmes were broadcast in Quiché and Spanish. A monthly bulletin
on the project has been published, along with a number of brochures teaching materials.

Main results which can be identified:
-
-

350 farmers’ and craftworkers’ groups gained legal recognition.
22  legally  recognised  farmers  and  of  craftworkers’  associations  represented  by  190  of
those 350 groups, which involve more than 12 000 families;
1  coordinator  legally  recognised  at  department  level  representing  the  22  associations
(CADIQ);
1 coordinator legally recognised at department level for 11savings and credit associations
and cooperatives with 20 000 families registered, over 8 000 of which are active members
(AODQU);
1 Credit Supervisory Board comprising a representative of the CADIQ, a representative
of the AODQU and a representative of the Government of Guatemala.

-

-

-
-

-

-

-

-

233

– 

Health

Two health projects were finalised. The Rehabilitation of the Sonsonate hospital, in
he El Salvador, started up in 1995. After suffering the effects of the earthquakes in
January and February 2001, the project finished in April 2002.

The  objective  of  the  APRESAL  (Support  for  health  sector  reform)  project  in
Guatemala was to  improve  health  of  the  country’s  poorest  inhabitants  by  measures
targeting the quality of the health care, the distribution of drinking water, access to
medicines and the training of human resources.

There was no mid-term evaluation of health projects. However, 11 projects are under
way in Venezuela, Peru, Bolivia, Brazil and Central America.

There  were  no  plans  in  the  2002  budget  for  commitments  in  this  sector  as  such.
However,  as  part  of  the  fight  against  drugs  and  drug  addiction,  €1.6  million  was
committed for a project for the control of precursors covering the five Andean Pact
countries.  Precursors  are  chemicals  widely  used  in  industrial  and  pharmaceutical
processes, and are marketed quite legally in large quantities. They also play a role in
the  illicit  preparation  and  the  development  of  narcotic  drugs  and  psychotropic
substances.  The project  will  encourage  better  implementation  of  the  agreements  on
control  of  chemical  precursors  between  the  European  Union  and  drug-producing
countries,  the  aim  being  to  stop  these  substances  being  diverted  from  the  legal
market to the illicit market in the Andean countries.

Rehabilitation of Sonsonate hospital - El Salvador

This project successfully achieved its goals: rehabilitation of the hospital buildings, provision of
equipment,  staff  training  and  administrative  support  for  management  (EC  contribution:
€8.4 million).

The  200  bed  Sonsonate  hospital,  a  secondary  hospital,  plays  a  strategic  role  in  the  country’s
health  service.  Now  that  it  has  been  rehabilitated,  it  is  the  referral  institution  for  19  primary
care centres and meets the hospital care needs of 500 000 people in 22 communes.

Even if it is still too early to be able to quantify the results in terms of people’s health status, the
project has had a number of benefits:

-  First  hospital  in  the  country  to  operate  a  full  computerised  management  system  based  on
electronic patient files.

- The waiting list for scheduled surgery has been reduced from 6 months to 1 month. Increased
operating theatre productivity, from 401 operations in 1998 to 2068 in 2002.

- Institutional maternal mortality reduced by half.

The  hospital  finances  part  of  its  running  costs  with  revenue  from  its  laboratory  analysis  and
radiology services to the private sector (6.9 millions colones a year, i.e. €756 973).

234

– 

Education

In 2002, three projects were finalised in this field, in Nicaragua and Venezuela.

The ASEN Programme of support to the education sector in Nicaragua was designed
to  increase  the  coverage  and  quality  of  the  education  system,  particularly  in  rural
areas. Started in May 1998 it was closed in April 2002.

A  second  project  completed  in  Nicaragua  was  AFORPRO  -  Support  for  vocational
training (EC contribution: €5.2 million; duration: 5 years). whose main objective was
to  improve  staff  training  in  vocational  schools.  It  was  the  first  EU  aid  financed
vocational training measure in this country.

Another  project  in  Venezuela,  CEMA  -  Creation  of  a  national  training  centre  for
motor  mechanics  was  designed  to  update,  expand  and  ensure  the  continuity  of
vocational  training  for  young  people,  train  technicians,  reintegrate  unemployed
young people into the workplace and help small and medium-sized enterprises in the
motor  industry  with  technical  training  and  management.  1 200  people,  including
young people and adults, were trained each year.

Fourteen  specific  projects  are  in  hand  in  various  Latin-American  countries,  in
particular  in  the  basic  and  vocational  education  sector.  An  additional  €2.8  million
was provided to boost the middle-level education project in El Salvador, which was
badly disrupted by the earthquakes in January and February 2001. This important and
complex project to promote the reform of middle-level technical education, with an
initial  duration  of  4  years,  will  thus  be  extended  by  2  years  in  order  to  ensure  the
sustainability of the work (EC contribution: €14.2 million).

The EC extensively supports higher education in Latin America through two regional
programmes: ALFA, strengthened in 2002, and ALBAN, launched in 2002. (total EC
contribution:  €62  million).  They  are  among  the  largest  in  the  exercise  and  reflect
clearly the importance attached to the priority sector that is education. Large amounts
have  also  been  programmed  for  2002-2006  to  develop  operations  in  this  sector  in
Nicaragua, Honduras and Peru from 2003.

–  Macroeconomic policies

The European Commission does little in the field of macroeconomic policy in Latin
America  given  the  disparity  between  the  sheer  size  of  the  economies  of  many  of
these  countries  and  the  amount  of  aid  resources  available,  and  the  Commission’s
focus  in  this  region  on  projects  targeting  limited  facets  of  the  economy  or  sectoral
policies.

The influence of macroeconomic policies on cooperation activities, especially in the
poorest  countries  of  the  area  (HIPC  beneficiaries  and  intermediate  economies),
nevertheless  is  and  will  remain  very  important.  In  countries  like  Nicaragua  or
Honduras, the contribution made by Community aid has a significant impact on the
major macroeconomic balances.

A  €200 000  grant  to  CEPAL  in  2002  was  used  to  fund  a  Euro-Latin-American
network of macroeconomic coordination experts. The aim of this project is to enable
macro-economists in charge of the technical aspects of the budgetary and monetary

235

policies of each Latin-American economy to dialogue directly and regularly among
themselves,  initially  within  a  subregional  network  (Mercosur,  CAN  and  Central
America),  and  subsequently  between  networks.  The  project  was  also  designed  to
present and discuss Europe’s experience in moving towards Economic and Monetary
Union to enable the Latin-American partners to identify operational conclusions for
their own regional integration exercise.

– 

Environment

About  fifteen  environment  projects  were  started  in  2002,  a  field  in  which  regional
integration remains a priority  as  a key  supporting element in multilateral initiatives
for  joint  operations,  partly  to  improve  living  conditions  but  also  to  prevent  and
reduce  the  risks  of  natural  disasters.  Projects  of  this  type  include  the  current
Development  of  the  Honduras  El  Salvador  frontier  region  (EC  contribution:
€34 million).

Commitments  in  the  environmental  sector  are  divided  between  financial  and
technical cooperation operations and pilot projects financed under the specific budget
line for the environment and tropical forests.

The  first  category  includes  three  new  operations  committed  in  2002:  strengthening
local management of natural resources in the Patuca and Choluteca drainage basins
in Honduras (EC contribution: €34 million), Strengthening civil protection systems in
the  five  countries  of  the  Comunidad  Andina  de  Naciones  (CAN)  (EC  contribution:
€9.4  million)  and  Development  of  environmental  policies  in  Nicaragua  (EC
contribution: €1.6 million).

Under the specific budget heading a total of €16.7 million was committed in 2002 for
8  new  operations  in  Latin  America.  The  most  significant  individual  contribution
concerns  a  new  section of the  Pilot Conservation  Programme  for  the  Brazilian  rain
Forest (PPG7), the Ecological corridors project, which aims to test and consolidate a
new  approach  to  biodiversity  protection  by  the  expanding,  diversifying  and  better
linking of protected areas within two of the main  Brazilian biomes, the Amazonian
forest and the Atlantic forest. The EC aid will concentrate on the central Amazonian
corridor.  In  addition  to  these  eight  projects,  three  “global”  projects  committed  in
2002 on international issues will be carried out at least partly in Latin America. Their
aim  is  to  foster  understanding  of  the  links  between  trade,  environment  and
development, and to help the countries of the region improve their  capacity to  take
part in international climate change initiatives.

The project Flood Prevention programme in Miranda, Falcón and Yaracuy States in
Venezuela,  committed  in  2002,  will  provide  the  necessary  infrastructure  and
appropriate measures to reduce the risk of recurring floods and their consequences by
means  of  rational  and  sustainable  management  of  drainage  basins  and  the
introduction  of  appropriate  methodologies  and  technologies  (EC  contribution:
€10 million).

– 

Partnership with civil society and NGOs

Commitments for 2002 total €13.8 million for Central America and €24.7 million for
South America to which should be added, for completeness’ sake, the “all countries”
block grants.

236

Acção para o Sustento dos Grupos da População Urbana Excluídos do Mercado formal de
Trabalho e Integrando a Defesa Ambiental do Município da Cidade de belo Horizonte - Brazil

Objective: promote social integration of marginalised people, deprived of their rights and living
in  wretched  conditions.  The  project  aimed  to  promote,  organise  and  structure  urban  waste
recovery  and  processing  activities  to  create  stable  sources  of  income  for  these  people,  while
helping  them  to  become  better  integrated  in  society  (total  cost:  €675 393;  EC  contribution:
€299 485; duration: 24 months).

Contracting NGO: COSPE - Cooperazione per lo Sviluppo dei Paesi Emergenti - Florence

Partners:  ASMARE  -  Associação  dos  Catadores  de  Papel  e  Material  Reaproveitavel,  belo
Horizonte, Brazil

The  project,  finalised  in  March  2002,  achieved  its  goal  of  organising  and  structuring  urban
waste  of  collection  and  processing  activities  by  creating  and  strengthening  associations  of
workers  in  the  sector,  in  terms  of  staffing,  skills,  infrastructure  and  equipment.  Membership
increased  considerably  and  members  incomes  became  much  more  stable,  thus  ensuring  the
sustainability of the project. Support for the first national Congress of associations of reusable
waste  collection  workers  provided  an  opportunity  to  disseminate  best  practices  and  foster
cooperation and the development of synergy at the national level.

A  new  project  is  planned:  the  creation  of  an  industrial  waste  processing  unit,  to  give  the
associations control of the chain of activities from collection until final sale.

– 

Links between humanitarian aid, rehabilitation and development

The Regional Rebuilding Programme for Central America (PRRAC) was adopted by
the Commission in April 1999 in response the need for reconstructions following the
damage  caused  by  Hurricane  Mitch.  Its  objective  was  to  help  rehabilitate  and
improve  infrastructure,  facilities  and  management  in  the  fields  of  education,
sanitation  the  public  health  and  to  improve  the  sustainability  the  services  in  these
areas.  At  present,  the  PRRAC  has  reached  its  cruising  speed.  The  76  projects
approved  to  date  (for  a  total  of  €248.6  million)  are  under  way  and  payments  are
running at €32.8 million.

– 

Rehabilitation/anti-personnel Mines

The  project  comprising  humanitarian  mine  clearance  on  the  border  between
Nicaragua  and  Honduras  and  operations  under  the  special  action  plan  for  mines
(EC contribution  €1.3  million),  was  implemented  in  2002  by  the  Organisation  of
American  states  (OAS).  The  expected  result  is  the  restoration  of  safety  and  the
release of productive land in the communities concerned.

– 

Refugees/Population

Two  projects  for  the  disadvantaged  were  finalised  in  2002.  One,  PROAMBA  -
Comprehensive  support  for  the  socialisation  of  marginalised  minors  in  Greater
Buenos  Aires,  in  Argentina,  was  designed  to  help  bring  about  in  a  substantial
reduction in the effects of poverty among children and adolescents living in marginal
districts  of  the  Buenos  Aires  metropolitan  area  (EC  contribution:  €9.3  million;
duration: 4 years and 4 months). This innovative and fully participative project, the
first  of  its  kind  in  Argentina,  succeeded  in  bridging  the  gap  between  the  state  and
civil  society.  A  total  of  58  NGOs  provided  direct  attention  for  6  000  children  and
adolescents and valuable support for 9 000 families. Many people received training
and  nationwide  radio  broadcasts  over  a  period  of  720  days  dealt  with  issues  of
children at risk.

237

The other project Social development in Quito Old Town, in Ecuador, was designed
to improve social service provision, in particular in the health sector, the protection
of  vulnerable  and  high-risk  groups,  and  the  restoration  of  the  environment  (EC
contribution:  €3.5  million;  duration:  3  and  a  half  years).  To  date,  28  specialised
health  centres  have  been  built,  extended  and  equipped  (early  childhood  centres,
vocational training, family violence centres, centres for the elderly). In all, 8 611 m2
of  infrastructure  has  been  built  or  repaired.  More  than  160  000  people  have  used
services set up by this project.

The disadvantaged in Latin America deserve special attention. Currently 16 projects
are  under  way, particularly targeting  juvenile  delinquence  and  women’s  integration
into  the  labour  market.  Three  projects  in  this  field  were  the  subject  of  a  mid-term
evaluation.

REPEME - Programme to support the social reintegration of delinquents and minors
in an illegal situation provides backing for the reform of the legal system as part of
the structural reforms undertaken by Venezuela. The project should help improve the
physical and psychological conditions of detention in a number of adult and juvenile
prisons. By end 2001, 1 890 interns and 2 850 officials had followed training courses
and seminars. A 6-month extension is currently under way.

ACTUA - Integrated programme to combat urban poverty in Chile (EC contribution:
€9.66  million;  duration:  5  and  a  half  years),  has  had  promising  results  in  6  target
municipalities where a model social policy decentralised at municipal level, already
adopted  by  the  central  government  in  other  municipalities  of  the  country,  was
developed.  A network of  state  and municipal social  services  serving  approximately
1 300  families,  provides  comprehensive  and  personalised  assistance  and  facilitates
the preparation and financing of small-scale projects to improve the family incomes
and housing.

AMAR - Comprehensive assistance to at-risk minors, in Paraguay (EC contribution:
€10 million; duration: 5 years), was evaluated a year and half before the planned end
of the activities. The national contribution of €2.7 million was not made available on
schedule.  The  evaluation  report  noted  that  the  Paraguayan  bodies  concerned  were
behind schedule in taking ownership of the project and proposed changes to improve
the rate of implementation. These changes are in hand.

to  prevent 

Now  operations  include  a  project  committed  in  El  Salvador  concerning  social
juvenile  delinquency  and  violence  (EC  contribution:
measures 
€9.2 million).  Its  objective  is  to  cut  juvenile  delinquency  by  half  and  improve
security  in  densely  populated  areas  of  San  Salvador.  €1.5  million  has  also  been
committed under budget heading B7-312 as a contribution to UNHCR operations to
assist displaced persons in Colombia.

6.6.4

The three Cs (Consistency, Coordination and Complementarity)

Consistency  with  other  Community  policies  is  ensured  by  close  coordination
between  the  various  European  Commission  departments  at  the  time  the  strategic
programming documents - Country Strategy Papers - are drafted; for Latin America
they  were  mainly  drawn  up  in  2002.  This  approach  is  essential,  particularly  in  the
case  of  guidelines  for  regional  entities-  Central  America,  the  Andean  Community
and  especially  Mercosur  -  where  the  thrust  of  the  Community  measures  is  the

238

progressive  liberalisation  of  trade  (in  the  spirit  of  Doha)  and  hence  support  for
sustainable development, macroeconomic coordination, harmonisation of tax policy,
technical standards, research and technology, etc.

The  issue  of  complementarity  is  addressed  during  donor  coordination  of  the
implementation of existing Poverty Reduction Strategy Papers.

6.6.4.1 Cooperation in the region with the Member States and other financial backers

Coordination  and  complementarity  with  policies  and  operations  undertaken  by  the
Member States are also addressed from the time the strategy papers  are  first  drawn
up.

Coordination with the Member States is particularly advanced in Bolivia, which gets
development  aid  from  a  wide  range  of  donors.  The  Delegation  of  the  European
Commission  in  La  Paz  chairs  two  of  the  four  thematic  groups  set  up  as  part  of  an
overall coordination mechanism established by the Government, on which all donors
are represented.

The European Commission is active in the consultative groups of  donors organised
by  the  Inter-American  Development  Bank  (IADB),  including  meetings  in  2002  for
Guatemala, Ecuador and Peru.

The  project  to  strengthen  civil  society  in  Guatemala  is  an  example  of  close
cooperation in the preparation and implementation of individual operations between
the EC and the Member States in the field, with regular joint meetings taking place.
All proposals for project in Latin America are thoroughly discussed by the Member
States’ representatives on the spot, and Member States also give their opinion when
the proposals are discussed by the relevant financing committee at headquarters.

The mid-term review of PPG7, the main programme for management and protection
of the Amazonian  forest  and a major  cooperation partnership between  Brazil  and  a
number of donor countries including the European Commission, was another specific
example in 2002 of international donor coordination. Sectoral programmes (support
for policies), several of which are in preparation, are developed in close cooperation
with the IADB, the World Bank, the International Monetary Fund (the IMF) and the
Member States on the spot. In this connection an important event was the signing in
May  2002  of  the  Memorandum  of  Understanding  with  the  IADB,  in  which  the
parties  undertook  to  contribute  to  the  social  and  economic  development  of  Latin
America  and  Caribbean  countries  by  working  together  in  various  areas  of
cooperation:  sectoral  support  for  Honduras  and  Nicaragua,  information  society,
social equality and poverty  reduction, natural disasters, consultation of civil society
on  trade  liberalisation  and  integration  processes,  integration  in  Central  America.
There  is  also  close  cooperation  with  the  World  Bank  on  the  same  issues  (sectoral
programmes  in  Honduras  and  in  Nicaragua).  The  Commission  is  now  involved  in
Country  Financial  Accountability  Assessment  (CFAA  exercises)  conducted  by  the
IADB  and  World  Bank  in  Nicaragua  and  Honduras,  assessing  public  finance
management  in  the  two  countries.  The  Commission,  in  agreement  with  both
Governments  and  the  two  financial  institutions,  will  check  expenditure  for
conformity  and  veracity,  supplying  input  for  action  plans  to  improve  the
management of public finance.

239

6.6.4.2 Activities of the EIB

The  European  Investment  Bank  (EIB)  finances  projects  of  common  interest  to  the
Latin  America  countries  and  the  European  Union,  providing  backing  for  European
foreign direct investment or other objectives as part of the EU’s cooperation policy.

In 2002, the Bank signed two loans in Latin America worth a total of €85 million.

The  first  €55  million  loan  went  to  Companhia  Energética  do  Ceará  (COELCE),  a
Brazilian  electricity  distribution  company  privatised  in  1998.  Endesa,  a  Spanish
electricity  company,  is  the  largest  shareholder  and  operator.  The  project  will  be
implemented  in  one  of  the  least  developed  parts  of  Brazil;  it  has  significant
development potential and will help reduce regional disparities.

The  second  EIB  loan,  of  €30  million,  went  to  the  Central  American  Bank  for
economic integration,  and  will be  used  to  finance  small  and  medium-sized  private-
sector  investment  projects  in  Costa  Rica,  El  Salvador,  Guatemala,  Honduras  and
Nicaragua. Priority will be given to projects that are carried out by subsidiaries of EU
companies  or  EU/Central  America  joint  ventures  or  involve  some  other  type  of
common interest (transfer of know-how, particular environmental  benefits, regional
development etc.)

6.6.4.3 Humanitarian Aid

ECHO’s activities in Latin America in 2002 were mainly concerned  with the crises
in Colombia and assistance to internally displaced persons. In a continent frequently
affected  by  earthquakes,  hurricanes  and  floods,  responding  to  natural  disasters  also
continues  to  be  a  priority.  ECHO  provided  relief  to  victims  of  flooding  and
landslides  in  Brazil,  flooding  and  a  volcanic  eruption  in  Ecuador,  and  snowstorms
and  intense  cold  spells  in  Bolivia  and  Peru.  In  Central  America  (Guatemala,
Honduras  and  Nicaragua),  ECHO  focused  its  activities  on  nutritional  problems
caused  by  irregular  rainfall.  In  El  Salvador,  following  the  earthquakes  of  2001  a
project was financed  to  teach  people traditional  low-cost  earthquake-proof  building
techniques. In Mexico, ECHO helped settle indigenous peoples in the Chiapas and in
Cuba money was mobilised to help victims of hurricanes Isidore and Lili.

ECHO supported projects in the Andean Community and Central America under its
DIPECHO  disaster  prevention  programme,  the  aim  of  which  is  to  ensure  that  the
local  people  are  prepared  better  to  face  natural  disasters.  DIPECHO  also  started  to
transpose lessons learned locally to the national and regional levels.

240

Humanitarian Aid office of the European Community (ECHO)
Financing decisions 2002

Country

Amount in
€ million

(El  Salvador,  Guatemala,  Honduras,

Bolivia, Peru

Brazil

Central  America 
Nicaragua)

Colombia

Cuba

Ecuador

Mexico

Paraguay

DIPECHO Plan of action for the Andean Community

DIPECHO Plan of action for Central America

Total

6.6.5

Results of monitoring

1.3

0.35

5.028

9.2

0.6

1.248

1.0

0.92

1.64

2.9

24.186

In  Latin  America,  during  2002,  a  total  of  104  projects  were  monitored,  covering  a
total financing volume of approximately €777.5 million.

Breakdown of projects visited by area of cooperation

2002

Number of
Programmes and
projects

Trade + Development
Regional Integration*
Macroecon + Social Serv
Transport
Food Sec. + Rural dev.
Inst. capacity + good gov
Other

2

3

4

5

6

7

1
(3)
34
-
49
19
-

Total budget Average size

8 015 000
(7.576.195)
220 438 491
-
403 726 688
145 214 475
-

(€)

4 007 500
(2.525.398)
6 483 485
-
8 239 320
7 642 867
-

Total

104

777.394.654

7 474 949

* The sample is too small (3 projects) to be statistically relevant

The analysis of the monitoring exercise shows that the areas most closely related to
poverty  alleviation  (macroeconomic  and  social  services,  food  security  and  rural
development, institutional capacity and  good  governance) make  out the bulk of  the
EC cooperation in Latin America.

241

Average ratings for monitoring criteria, by Priority Areas

&

e
d
a
r
T

t
n
e
m
p
o
l
e
v
e
D

2
n
o
i
t
a
r
g
e
t
n
I

l
a
n
o
i
g
e
R

.
c
i
m
o
n
o
c
e

-
o
r
c
a
M

t
r
o
p
-
s
n
a
r
T

y
t
i
r
u
c
e
S
d
o
o
F

.
g
n
d

i

l
i

u
B
p
a
C

l
a
n
o
i
t
u
t
i
t
s
n
I

a
c
i
r
e
m
A

r
e
h
t
O

n

i
t
a
L

2
0
0
2

l
l

A

Relevance

Efficiency

2.00

3.00

Effectiveness

2.50

Impact

2.50

Sustainability

2.50

Average

2.90

3.00

3.33

3.00

3.33

2.33

3.00

2.81

2.88

2.96

2.88

3.00

2.91

-

-

-

-

-

-

2.79

2.83

2.87

2.74

2.72

2.79

3.00

2.89

3.13

3.00

2.56

2.95

-

-

-

-

-

-

2.83

2.86

2.93

2.83

2.78

2.85

In  view  of  the  overarching  goal  of  poverty  reduction,  the  results  of  three  above–
mentioned  important  areas,  as  shown  in  the  above  table,  are  particularly  positive.
Moreover, the sample of 13 reports on Education programmes showed good results
in original design (relevance and design 2.82) and excellent ratings for effectiveness
(3.25),  efficiency  (3.0)  and  sustainability  (3.0).  Also  here,  as  in  other  regions,
financial sustainability remains crucial, but shows positive prospects for the projects
covered as the interventions are expected to be continued with public financing.

In terms of strengths and weaknesses conclusions suggest that:

Efficiency  and  impact  of  projects  are  often  positively  influenced  by  flexibility  and
adaptation. Socio-cultural, technological and environmental concerns in EC projects
tend  to  contribute  positively  to  their  overall  sustainability.  However,  weak  original
design  and  lack  of  timeliness  in  activity  implementation  negatively  affect
performance  with  regard  to  relevance  and  efficiency,  respectively.  Financial
sustainability remains a major source of problems.

6.6.6

Conclusions and prospects for the years to come

Cooperation between the EU and  Latin America  received  a boost in  2002 from  the
Madrid  Summit  and  the  intense  activity  involved  in  negotiating  comprehensive
regional and bilateral agreements.

It was also a year in which governments and civil society began to work more closely
together. The Commission made a significant contribution to this process, organising
the consultation of civil society on the EU-MERCOSUR and EU-Chile negotiations
and  the  implementation  of  the  existing  framework  agreement  between  the  EU  and
Mexico. The Commission also provided backing for meetings organised by the civil
society in Europe, Latin America  and the Caribbean on  the occasion  of  the  Madrid
Summit.

Already 25% of Community cooperation in  Latin America is  implemented  by  civil
society  organisations;  the  challenge  in  the  next  few  years  will  be  to  incorporate
intensive  dialogue  between  government  and  non-governmental  actors  in  the  actual
framing of cooperation policies between the EU and Latin America.

242

 
 
 
 
In the medium term, the  success of  the negotiations with Mercosur  and  the  start of
talks with the Andean Community and Central America will help improve the EU’s
relations with the three sub-regions and frame the strategic partnership between the
EU and Latin America as a whole.

On  the  operational  front,  there  were  two  new  developments  in  Community
cooperation in Latin America in 2002:

– 

– 

methodologically  the  European  Commission  paved  the  way  for  sectoral  and
budgetary support measures in Central America and Bolivia, the first results of
which should be visible as from 2003;

devolution of the management of external aid to the Delegations was continued
and consolidated. Once they have received the extra staff  and equipment they
need,  which  should  be  in  2003,  all  the  Delegations  of  the  European
Commission in Latin America will operate on the new lines.

243

7.

7.1

FEATURE: WATER MANAGEMENT IN EU CO-OPERATION

THE IMPORTANCE OF WATER FOR DEVELOPMENT

Freshwater is a finite and precious resource  essential for sustaining  life,  for
undertaking  economically  productive  activity,  and  for  the  environment.  No
strategy  for the  reduction of poverty can ignore  people’s  vital  requirements
for  water,  and  sustainable  development  policies  must  address  the  need  for
equitable and sustainable management of water resources in the interests  of
society as a whole. Overall, the global water crisis threatens lives, sustainable
development and even peace and security.

Population growth and rapid urbanisation, changing lifestyles and economic
development have led to increasing pressure on water resources everywhere,
but especially in developing countries. Without effective action, this situation
will get worse: the United Nations estimates that two out of three people will
be  living  with  water  shortages  by  2025.  Over  the  next  two  decades,  it  is
expected  that  the  world  will  need  17%  more  water  to  grow  food  for
increasing populations in developing countries, and that total water use will
increase by 40%. One third of countries in water-stressed regions could face
severe water shortages this century.

Proportion of population with sustainable access to an improved water source
(%)

South Mediterranean - Near & Middle East

Pacific (*)

Latin America

Eastern Europe & Central Asia

Caribbean

Balkans

Asia

Africa

MDG
2015 

2000

1990

(*) Only one country : Papua New Guinea

0

20

40

42
42

71

92

89

84

91

86

83

86

72
74

90

80

71

74

80

100

52

58

60

244

Water Supply and Sanitation per Sub-sector

8%

3%

15%

5%

1%

Water Resources Policy/Admin. Mgmt

Water Resources Protection

Water And Sanitation

Low-Cost Water And Sanitation

River Development

Waste Management/Disposal

68%

245

7.2

WATER AND THE MILLENNIUM DEVELOPMENT GOALS

In  recognition  of  the  critical  importance  of  water  for  development  and  the  urgent
need  to  address  this  crisis,  the  Millennium  Development  Goals  include  a  specific
target on water: to halve, by 2015,  the  proportion  of people without sustainable
access to safe drinking water. The chart below shows how far there is to go to reach
this target in different regions.

The  World  Summit  on  Sustainable  Development  in  Johannesburg  in  2002  took  a
particularly  important  step  with  the  adoption  of  a  new  international  target,  with
strong  EU  support:  to  halve  by  2015  the  number  of  people  without  access  to
sanitation, to complement the target on access to drinking water. The adoption of
a new target to develop integrated water resources management plans was also a
positive step forward.

Access to water and sanitation is also critical for the achievement of other MDGs,
such  as  the  target  on  infant  mortality.  Adequate  supplies  of  clean  water  and
sanitation could reduce cases of some diseases by as much as 75%.

initiatives, 

investing  around  €1.4  billion  a  year 

The  EU  is  already  the  largest  provider  of  development  assistance  for  water-
related 
in  water-related
development aid and scientific cooperation. In addition to interventions carried out in
the  context  of  country  and  regional  programmes,  water-related  activities  are  also
carried  out  in  the  framework  of  NGO  co-financing,  micro-projects,  decentralised
cooperation  and  humanitarian  aid.  The  EU’s  contribution  in  this  area  is  set  to
increase, following the launch of the EU Water Initiative at WSSD.

7.3

PEOPLE  AND  WATER:  IMPROVING  ACCESS  TO  WATER  AND
SANITATION SERVICES

Inadequate water supplies are both a cause and an effect of poverty. Invariably those
without  adequate  and  affordable  water  supplies  are  the  poorest  in  the  society.  The
effects  of  inadequate  water  supply  -  disease,  time  and  energy  expended  in  daily
collection,  etc.  -  exacerbate  the  poverty  trap.  Donors,  recipient  countries  and
stakeholders must work together to improve access to water services.

Actions should be designed to achieve the goal of offering affordable water services
while  ensuring sector  sustainability.  In  order  to  reach  this  objective,  some  critical
issues should be addressed, including the need to improve operation and maintenance
capacity  with  increased  user  participation;  to  minimise  unaccounted-for  water  and
reduce  water  wastage;  to  introduce  water-saving  devices,  and  reuse  water  where
possible; to price water services appropriately so as to safeguard the interests of the
poor; to introduce incentives for safeguarding water quality at community level, such
as the protection of wells and careful water storage.

246

Some Facts and figures

-

-

-

Over  1  billion  people,  or  18%  of  the  world’s  population,  lack  access  to  safe  drinking
water and over 2.4 billion people do not have adequate sanitation

2.2  million  people  in  developing  countries,  most  of  them  children  (6,000  per  day),  die
every year from diseases associated with lack of access to safe drinking water, inadequate
sanitation and poor hygiene

If current trends persist, by 2025 the demand for freshwater is expected to rise by 56%,
more than is currently available. About 70% of current demand is from agriculture, the
remainder from household, urban and industrial use and consumption

Water provision cannot be separated from two other inter-related factors - sanitation
and health. This is because one of the primary causes of contamination of water is
the inadequate or improper disposal of human (and animal) excreta. This often leads
to a cycle of infection (resulting primarily in diarrhoeal diseases) and contamination
which remains one of the leading cause of illness and death in the developing world.
The  effects  of  increased  access  and  improved  services  are  thus  cross-sectoral,  and
require  interaction  with  other  sectors:  health,  education,  rural  and  urban
development.

Extending sanitation coverage and hygiene education: A much greater emphasis
on sanitation is required in order to gain ground in this often-neglected area. At any
one time it is estimated that half of the world’s hospital beds are occupied by patients
suffering  from  water-borne  diseases.  This  means  improved  hygienic  behaviour  and
environmental  sanitation  are  critical  as  water  supply  in  programmes  to  promote
public health while low-income communities must be given a better understanding of
the links between poor hygiene and disease.

Meeting the challenge of urbanisation: Access to water and sanitation facilities in
urban settlements is constrained by two sets of factors, the inadequacy of the existing
systems  and  management  structures  to  cope  with  growing  demand  for  fresh  water
and  sanitation  services  coupled  with  the  rapid,  unplanned  increase  in  the  urban
population which has put additional pressure on a system already under severe strain.
To  make  matters  worse,  the  newcomers  settle  -  often  illegally  -  in  unserviced
marginal  areas  (an  estimated  25%  of  people  in  developing  country  cities  purchase
their water  from  water vendors  at  significantly higher  prices  than  piped  water)  that
would require a considerable capital investment. A local and national policy of urban
settlements  can  help  alleviate  the  pressure  of  rural-urban  migration  on  the  system.
Such  a  policy  should  not  impede  migration  to  urban  centres.  Assuming  that  the
phenomenon  of  rapid  urbanisation  in  the  developing  world  cannot  be  reversed,  a
sensible  approach  would  be  to  regulate  and  plan  the  growth  of  cities  in  order  to
optimise the resources available.

247

SOMALIA – An integrated approach to support sustainable urban development

In 2002, the Commission completed an urban sector profile study to identify ways  of assisting
municipal authorities in Somalia to improve their capacity to better serve basic needs and other
demands of the population. The proposed strategy is to adopt an integrated approach to urban
challenges  and  needs.  Good  urban  management  and  good  urban  governance  are  seen  as  the
common  requirements  for  balanced  and  sustainable  progress  in  the  different  areas  for  which
municipal bodies are responsible.

Under this approach, water management is one of the responsibilities of municipal government,
although any action in the field must be linked to the overall goals of better urban management
and governance. An example of the linkage between optimisation of water resources and urban
planning  is  the  way  urban  layout  affects  the  cost  of  water,  waste-water  management  and
drainage. An element of the integrated approach that applies to the provision of water-related
services  is  the  need  to  build  stakeholder  capacity  at the  relevant  levels  to  reinforce  ownership
and sustainability.

The challenge in rural areas: It is estimated that women in Africa and  Asia  walk
around  6km  daily to  collect  water,  carrying an  average  of  20  kgs  of  water  on  their
heads. This takes up a lot of time and energy, and the burden is also often borne by
children, keeping them away from school. Furthermore, in most developing countries
rural  economic  growth  is  a  critical  precondition  for  overall  economic  growth,  and
food production remains the main economic activity of much of the rural population.
Expanded economic yield mainly comes from natural resource-based goods, such as
agricultural,  animal  husbandry  or  fishery  products,  all  of  which  require  sustainable
management  of  water  resources.  Integrating  the  management  of  land  and  water
resources  is  key  to  both  water  and  food  security,  particularly  in  areas  with
competition  over  water  resources,  and  calls  for  improved  water  use  efficiency  in
agriculture  which  is  the  largest  user  of  freshwater,  to  reduce  the  pressure  on  the
resources. The  poorest and most  vulnerable  rural dwellers  are  particularly  sensitive
to lack of water of acceptable quality.

A  number  of  issues  associated  with  the  use  of  water  in  food  production  therefore
need  to  be  taken  into  account  in  advocating  sound  water  use  and  management,
placing  an  emphasis  on  small-scale  water-efficient  approaches,  such  as  rain-water
harvesting, small-scale drip irrigation, or re-using wastewater for irrigation. Actions
to promote food security in poor rural areas should include livelihood diversification,
together  with  water  saving  methodologies  and  more  sustainable  management
systems.  This  would  ensure  alternative  income-generating  opportunities  for  the
poorest people, and also decrease the pressure on scarce water resources.

TROPISEC - Nicaragua: Water, an important element in a rural development project

TROPISEC, a 7-year project cofinanced by the EC (€7 million) came to an end in 2002. Located
in the f Las Segovias region, one of the poorest and driest areas in Nicaragua, the project had
five objectives: training for  self-management,  institution-building  for  grassroots  organisations,
use and handling of natural resources, financial and technical support to rural development.

One of the main components of the project was the provision of drinking water and irrigation
systems  for  the  local  population.  FONDECA,  the  Farmer  Development  Fund  of  Las  Segovias,
aimed  to  provide  access  to  credit  and  help  develop  a  system  of  sustainable  intermediation  on
behalf  of  the  target  groups.  The  project’s  main  achievements  have  been  the  introduction  of  a
artisanal  basic  grain  seed  programme,  the  creation  of  2  565  family  or  communal  orchards  to
improve food security and the facilitation of technology transfer among farmers. 10 000 families
benefited from the project: 1536 water systems were installed for irrigation, 1 846 km of rural
roads  were  improved  and  repaired,  and  1650  water  systems  were  constructed  for  domestic
consumption. Environmental training was also provided for 727 technicians, with a significant
multiplier effect (training of 19 065 pupils).

248

7.3.1

The  EU’s  policy  response  to  the  challenge  of  improving  access  to  water  and
sanitation

The  EU’s  policy  framework  on  water  and  development  recognises  that  achieving
results  will  require  progress  in  many  different  areas,  particularly  governance  and
financing. In both cases, sustainability is a critical issue.

Good  governance:  Increasing  access  to  safe  water  and  sanitation  requires  that
political authorities give it a higher priority, and that measures to address these issues
are  integrated  into  national  and  municipal  strategies.  Greater  awareness  and
increased  knowledge  are  essential  to  support  planning  and  decision-making,
combined  with 
institutional  strengthening  and  capacity-building  activities.
Partnerships  between  public,  private  and  civil  society  actors  have  to  be  promoted,
ensuring  that  those  partnerships  remain  equitable,  accountable  and  transparent,
safeguard  consumers’  and  investors’  interests  and  maintain  high  standards  of
environmental protection.

Masibambane, a new water services sector support programme in South Africa

A  three-year water  services  sector  support  programme  (WS-SSP)  to  the  government  of  South
Africa is funded from the government’s own resources, EC cooperation and bilateral aid from
four EU Member States, to the tune of about 2 220 million Rand (€334 million, incl. €75 million.
EC budget support grant). The objective of the programme is to provide basic water supply and
sanitation  services  through  a  variety  of  activities  including  support  for  strategic  policy
development, and provision of water and sanitation services for selected poor rural communities
in three provinces (Northern Province, KwaZulu Natal and the Eastern Cape). The project also
provides institutional support to assist various levels of public sector institutions with emphasis
on stakeholder dialogue. In some instances new institutions such as District Councils, catchment
management  agencies  and  community  structures  will  be  established.  Good  governance  and
continued coordination among various actors are recognised as critical for the sustainability of
the programme and its effects.

249

The main expected results are:

A  reviewed  and  updated  policy  and  legislation  for  the  water  and  sanitation  services  sector  in
South Africa orienting the sector towards consumer-driven interventions.

Approximately  2.4  million  people  in  the  Northern  Province,  KwaZulu  Natal  and  the  Eastern
Cape provided with sustainable water and sanitation services.

Health and hygiene education included in all infrastructure projects.

Technical, managerial and administrative capacity of key role players improved (specifically the
capacity  of  Local  Government  and  Department  of  Water  Affairs  and  Forestry  (DWAF)
structures,  Water  Service  Authorities  and  Water  Service  Providers,  but  NGOs  and  private
sector will also be involved).

Integrated planning and coordinated management within the sector strengthened.

Gender unit within the water services chief directorate of DWAF established.

Financial  Challenges:  Traditionally,  the  municipalities  provide  water  services,  but
they  lack  the  financial  and  technical  capacity  to  cope  with  the  rapidly  increasing
demand. Innovative  approaches are needed.  Options must be  examined  carefully to
take  account  of  local  circumstances  including  health  risks,  prevailing  attitudes  and
customs,  acceptability,  existing  knowledge  and  practices,  costs,  ownership  of
facilities,  and  the  regulatory  framework.  In  addition  to  large  capital  investments,
institutional measures are required to find and exploit new water supply sources and
to  upgrade  and  expand  water  and  sanitation  reticulation  systems.  In  parallel,
institutional  measures  are  required  to  ensure  efficient  management  of  the  service,
including  adequate  provision  for  infrastructure  maintenance.  Cost-recovery  is
important  to  ensure  the  financial  sustainability  of  water  services,  although  tariff
structures  and  collection  systems  must  be  designed  appropriately  to  meet  the  basic
needs of poor and vulnerable groups.

GHANA – A public private partnership, suited to local circumstances
to improve small towns’ water supply

26 November 2002 - Kokofu, Ghana, 250 km north west of the capital Accra: As he does every
week, Mr Ansah, Technical Manager at the Water and Sanitation Development Board (WSDB)
of Kokofu, is checking the state of the water meters of the 13 public standpipes and 50 private
connections connected to the water distribution network. Under an accountant’s supervision, he
collects  the  water  sales  revenue  from  the  water  vendors.  The  cost  of  water  is  100  cedis  per
18-litre bucket (€0.68 per m³). The average daily consumption rate here amounts to 11 litres per
person. Thanks to this regular revenue collection, the WSDB has so far operated the system for
10 months, and in this space of time has managed to construct 10 additional private connections
and provide transport for operating staff. The bank account currently stands at 15 million cedis
(€1 700).

10% of the revenue from water sales, is allocated to maintenance, 10% to small-scale sanitation
projects and hygiene education, and 5% to the extension of the water supply system. The efforts
of the community and their representatives since the beginning of the project (consultations, 5%
contribution  to  investment  cost)  are  paying  back.  During  the  four  years  of  implementation  so
far, public works and monitoring have been established combined with private management in
two towns. Capacity-building efforts ranging from book keeping, system maintenance, technical
monitoring  and  management  techniques  to  hygiene  education  targeted  all  levels,  from
community via district to regional water and sanitation administration.

This  example  is  replicated  in  the  25  small  towns  in  the  Ashanti,  Brong-Ahafo  and  Western
Regions  included  in  this  project,  serving  a  total  population  of  310  000  people.  The  project  is
currently preparing the implementation of five additional systems which will eventually serve a
population  of  350  000  in  30  towns,  within  the  available  €15  million  allocation.  It  is  just  one
example of a “public-private partnership” adapted so far quite successfully - to local conditions.

250

In 2002, the EU refined its policy approach to water in the context of development
cooperation.  In  March,  the  Commission  published  a  new  Communication,  which
was endorsed by the Council in May.160 This builds on the need to take an integrated,
long-term approach, to work in partnership with  developing  countries  and  to  tackle
governance and financial issues, including sustainability, as a priority.

The  EU’s  over-arching  framework  is  ‘Integrated  Water  Resources  Management’
(IWRM), based on a  river  basin approach.  The EU believes that  IWRM, combined
with strong public participation, transparency and accountability, can play a critical
role  in  helping  to  achieve  the  targets.  It  is  particularly  important  for  sustainable
development and conflict prevention in the case of transboundary waters.

Integrated Water Resource Management in action

Doon Valley Integrated Watershed Management Project – India

This  8-year  project,  with  an  EC  contribution  of  €22.5  million,  was  particularly  successful  in
meeting  its  objective  of  reversing  ongoing  degradation  to  the  Doon  Valley  eco-systems  in
Uttaranchal  State  by  means  of  soil  conservation  works,  including  the  construction  of  check
dams and the planting of a combination of tree and grass species. Frequency of irrigation and
availability of water have thus increased. The living conditions of rural people  have  improved
further  as  a  result  of  their  involvement  in  the  management  of  their  environment.  Village
Associations  have  been  formed  to  ensure  ownership  and  promote  sustainability.  Farmers’
agricultural needs of the have generally been met by conventional watershed development, set to
move towards community watershed development.

The  Communication  and  the  Council  Conclusions  identified  a  number  of  clear
priorities:

– 

– 

– 

ensure a supply of sufficient, good quality drinking water, adequate sanitation
and hygiene for every human being, especially the poorest, with a clear focus
on the needs of women and children, and with the general objective of reducing
poverty  and  improving  people’s  health,  quality  of  life  and  livelihood
opportunities;

develop  sustainable  and  equitable  transboundary  water  resource  management
taking into account all relevant interests, integrating the competing needs of the
various users and facilitating South-South cooperation;

implement  cross-sectoral  coordination  to  ensure  equitable,  sustainable  and
appropriate distribution of water between users of different kinds. This requires
the mainstreaming of water management principles into related policy areas.

Action  and  innovative  approaches  are  needed  to  tackle  urgent  and  long-term
priorities  in  providing  water  services,  expanding  sanitation  coverage  and  hygiene
education,  meeting  the  urban  challenge,  achieving  water-food  security,  protecting
water  ecosystems,  and  managing  floods  and  coastal  areas.  Conflict  prevention  and
peace  building  efforts,  which  are  political  priorities  for  the  European  Community,
must include sustainable and equitable management of shared natural resources such
as water. Support for regional activities is recommended where a clear commitment
to regional collaboration exists.

160

COM(2002)132 of 12 March 2002, ‘Water Management in Developing Countries Policy And Priorities
for EU Development Cooperation’. http://register.consilium.eu.int/pdf/fr/02/st08/08958f2.pdf

251

                                                
The  EU  also  recognises  that,  as  water  resources  become  scarcer,  some  long-term
global  and  issues  will  become  increasingly  critical.  These  include  the  impact  of
climate  change  on  access  to  water,  which  increases  the  risk  of  extreme  events  and
depletes  resources,  and  the  interaction  between  water  management  and  trade  in
agricultural and industrial products that include a substantial water component.

To promote wider dissemination and uptake of its strategic  approach, the European
Commission  initiated  a  capacity-building  programme,  targeted  at  policy  makers
and  other  key  stakeholder  groups  in  the  ACP  region,  Asia,  Latin  America  and  the
Mediterranean region.

Promoting the Strategic Sectoral Approach through Capacity Building

The  EC  has  taken  a  leading  role  in  promoting  best  practice  and  helping  to  build  capacity  for
effective  water  management.  The  EC’s  Guidelines  for  Water  Resources  Development
Cooperation161  whose  centrepiece  is  a  ‘strategic  approach  for  the  equitable,  efficient  and
sustainable management of water resources’ establish policy principles for water resources and
water  services  management  (institutional,  social,  economic,  environmental,  and  technological).
They draw on internationally agreed core principles. These Guidelines illustrate the new focus
of  Community  support  for  water  in  developing  countries,  with  more  emphasis  on  social  and
environmental concerns and  management, and increased support for capacity - and institution
building.  A  series  of  workshops,  training  courses  and  mentoring  activities  have  been  used  to
help  stakeholder  groups  familiarise  themselves  with  the  key  principles  essential  for
sustainability.

7.3.2 WSSD and the launch of the EU water initiative

At the 2002 World Summit on Sustainable Development in Johannesburg (WSSD),
the EU signalled its intention to expand its role in the international effort to achieve
water and sanitation-related targets, with the launch of a new EU Water Initiative.

The Initiative was endorsed at the highest political level with the signature of a joint
declaration for a new Africa/EU strategic partnership on water affairs and sanitation.
A partnership between EU and Eastern Europe, Caucasus and Central Asia was also
endorsed at ministerial level during WSSD.

The main objectives

Through the Water Initiative the EU is reconfirming its commitment to help meet the
MDGs  and  targets  agreed  at  WSSD.  The  initiative  focuses  on  halving,  by  the  year
2015,  the  number  of  people  without  access  to  safe  drinking  water  and  basic
sanitation, currently estimated at about one and two billion respectively.

The second thrust of the initiative is to support the development of Integrated Water
Resources Management (IWRM) and water efficiency plans by 2005, promoting the
general adoption of river basin-scale policy, planning and management, particularly
for trans-boundary catchments.

The key elements of the Initiative aim to:

– 

Reinforce  political  commitment  to  action  to  increase  access  to  water  and
sanitation with view to poverty reduction.

161

http://europa.eu.int/comm/development/body/publications/water/en/frontpage_en.htm

252

                                                
– 

– 

– 

– 

Promote better water governance arrangements, including stronger partnerships
between  public  and  private  sectors,  and  local  stakeholders,  and  institutional
capacity-building.  Better understanding  of the  interaction  between  sustainable
water  management,  poverty  reduction,  the  developing  country  context  and
innovation  and  societal  mobilisation  are  essential  to  help  direct  future
investments  and  the  development  of  management  practices,  policies  and
technology taking account of societal and equity concerns. For this reason, the
EU Initiative includes a specific research component. The EU has also opened
its Sixth Research  Framework Programme to partners in third countries,162  to
facilitate the sharing of its experience and as a signal of its commitment to face
the global  and  regional  challenges  together  with  partners  in  different  parts  of
the globe.

Improve  coordination  and  cooperation:  This  includes  a  shift  away  from
standalone projects towards sector-wide approaches, the introduction of multi-
stakeholder  processes  to  reinforce  partnerships  for  action,  and  promotion  of
south-south collaboration and cooperation.

the 

Develop regional and sub-regional cooperation by assisting in  the  application
including
of 
transboundary  waters  to  contribute  to  sustainable  development  and  conflict
prevention.

resources  management  approach, 

integrated  water 

Catalyse  additional  funding  inter  alia  by  developing  new,  innovative  funding
mechanisms to attract new partners. The EU will make use of the full range of
financial mechanisms already available for water projects and will take action
to  address  financing  gaps.  In  fulfilment  of  the  commitments  it  made  at  the
international Financing for Development Conference in March 2002, the EU is
prepared  to  provided  increased  assistance  for  water-related  schemes.  In
keeping  with  the  integrated,  demand-led  nature  of  the  Initiative,  additional
funding will be considered in response to requests from partner countries, and
resources will be delivered over coming years within the context of countries’
efforts  to  reduce  poverty  and  promote  sustainable  development.  Overall,  the
Initiative  will  seek  to  identify  the  right  mix  of  financing  options  for  both
capital finance and cost-recovery programmes that are sensitive to the needs of
the poor.

Immediate Priorities

In the light of all these factors, the main priorities of the EU Water Initiative are to:

– 

– 

– 

develop  an  overview  of  the  situation  in  different  countries  and  regions,
analysing the main shortcomings and financial needs;

prepare  a  coordinated  action  programme  with  a  long-term  financial  strategy
providing specific stepping stones up to 2015; and

establish  a  monitoring  and  reporting  mechanism  to  measure  progress  in
implementation and steer further action.

162

http://europa.eu.int/comm/research/iscp/newsletter/agreements_en.html#01

253

                                                
The EU recognises the need to move quickly towards formulating and implementing
programmes that are visible and that deliver results. Progress is already taking place
in  those  countries  where  water  and  sanitation  are  focal  areas  of  development
programmes (including,  under  the  9th EDF,  Cap  Verde,  Chad,  Djibouti,  Dominican
Republic, Ghana, Lesotho, Mauritius, Nigeria, Papua New Guinea, Rwanda, Samoa,
Senegal, and Swaziland). In line with its commitment to a partnership approach and
recognising the importance of strong local ownership for the success of operations,
the  EU’s  top  priority  is  to  engage  with  governments,  the  private  sector  and  civil
society in developing countries and regions that have expressed an interest in the EU
initiative.  The  Initiative  is  being  taken  forward  with  the  active  involvement  of  EU
Member  States  and  the  European  Commission,  the  European  Investment  Bank,  the
private sector and civil society.

Preliminary multi-annual financial provisions:
Distribution across sectors by DAC sector categories

DAC Sector
Categories

CARDS

TACIS

MEDA

ASIA

Lat. Am

EDF 9

TOTAL

Time period

2002-2004 2002-2003 2002-2004 2002-2004 2002-2006

2002-2007

Total % Total % Total % Total % Total % Total %

%

14.  Water  Supply
and Sanitation

25.3 2.0 33.0 4.7

50.4

4.0

64.0

4.3

432.2

5.7 604.9 4.7

A Modular Approach

The  EU  Water  Initiative  is  being  developed  along  modular  lines  with  a  strong
regional  focus,  so  that  it  can  properly  take  account  of  both  differences  between
regions, and similarities within them.

– 

– 

In Africa, following the signing of the Africa/EC strategic partnership on water
affairs and sanitation at WSSD, two working groups have been established to
address priorities related to the provision of water and sanitation and integrated
water resources management issues at national and transboundary  levels.  In a
spirit of ownership, open coordination and in harmony with other efforts (such
as the New Partnership for African Development and the EU/Africa Dialogue),
the  EU  partners  are  working  with  the  African  Ministerial  Council  on  Water
(AMCOW),  central  and  local  governments,  civil  society,  private  stakeholders
and  multilateral  agencies  to  contribute  to  the  achievement  of  water-related
Millennium Development Goals and targets in Africa.

For  the  countries  of  Eastern  Europe,  Caucasus  and  Central  Asia,  again
following  the  agreement  on  an  EU-EECA  Strategic  Partnership  on  Water  for
Sustainable  Development  at  WSSD,  a  working  group  has  been  set  up  to
address  both  water  supply  and  sanitation  and  integrated  water  resources
management  aspects.  Ministers  have  undertaken  to  implement  WSSD  targets
and obligations in their  region  and  apply integrated  river  basin  approaches  in
transboundary watercourses. The work is closely linked with the development
of an EECCA environmental strategy by the NIS countries. An action plan is
expected to be presented at the Pan-European Kiev Environmental Ministerial
Conference in May 2003.

254

–  Mediterranean and Latin American components are being developed, following

the African and EECCA elements launched at WSSD

Key elements of the Outline Action Programme
for the Africa/EU strategic partnership
on water affairs and sanitation - agreed between AMCOW and EU

Prioritise Water Supply
and Sanitation and
IWRM / Institutional
support

Specific  actions  for
WS&S

- Prioritise  WS&S  in  the  national  Poverty  Reduction  Strategy  Papers  -

making the contribution to the MDGs visible.

-

-

-

In parallel with developing services establish an integrated approach to
water  resources  management  to  ensure  sustainability  and  meet  the
WSSD target.

Improve the underlying institutions and build capacity

Implement  a  dual  strategy  –  (a)  Sector  programme  approach  for
countries  with  strong  institutional  capacity,  (b)  Find  ways  of
supporting  countries  where  water  is  not  a  priority  sector  and
institutions need reinforcement.

- Bring the coordination of WS&S to the country level

- Use  EU  and  other  external  funds  as  a  catalyst  for  increased  national
funding/ private sector and user financing – recognising the huge scale
of funding required.

Specific  actions  for
IWRM

- Focus  on  immediate  opportunities  for  preparing  IWRM  plans  in

selected countries.

- Develop  programmes  for  strategic  support  to  build  transboundary
cooperation  (Surface  and  groundwater).  First  actions  to  be  based  on
self-selection  from  the  countries  and  from  AMCOW  Sub-regional
groups.

The Way Ahead

Meeting  the  three  agreed  targets  on  water  supply,  sanitation  and  integrated  water
resource  management  and  overcoming  the  global  water  crisis  will  be  a  major
challenge  for  the  international  community.  It  is  critical  for  poverty  eradication,
sustainable development and even conflict prevention.

Overall,  water  needs  to  be  given  a  higher  profile  in  national  and  regional  policy
agendas.  The  primary  responsibility  for  this  rests  with  governments  in  developing
countries.  Ownership  is  essential  to  achieve  results.  But  external  support  is  also
crucial,  in  particular  to  help  mobilise  additional  finance  through  development
assistance  and  other  means.  It  is  now  agreed  that  it  is  everybody’s  business  to
achieve  the  targets.  As  Commission  President  Romano  Prodi  said  at  the  World
Summit on Sustainable Development: business as usual is not an option.

255

8.

FINANCIAL TABLES

Breakdown by sector of Official Development Assistance (ODA)
financed on the General Commission Budget and the European Development Fund
(EDF) in 2002

Sector of Destination

Total

Amount of Commitments in € million+D2

1.982,55
253,94
52,32
21,81
89,42
90,39
196,43
96,76
99,67
170,06
92,88
875,83
393,41
10,15
9,71
373,55
585,89
310,67
9,44
84,90
120,88
60,00
720,28
163,23
105,18
29,54
28,51
382,20
180,09
202,03
0,08
174,85
157,21
17,64
520,84
72,57
14,32
433,95
1.091,85
614,35
477,50

Managed by EuropeAid Managed by Other DG's
70,72
15,50
2,70
0,00
0,00
12,80
0,00
0,00
0,00
0,00
8,03
4,40
42,79
0,00
0,00
42,79
28,92
8,05
0,87
20,00
0,00
0,00
204,55
196,61
6,76
0,00
189,85
0,00
0,00
0,00
0,00
7,94
7,94
0,00
198,60
12,56
0,00
186,04
180,36
4,86
0,00
175,50
0,00
0,00
489,75

88,67
88,67
123,64

123,64
205,79
135,54

70,25
5.319,51

489,75
40,32
6,32

34,00
1.213,22

SOCIAL INFRASTRUCTURE AND SERVICES

Education

Health

Education, level unspecified
Basic education
Secondary education
Post-secondary education

Health, general
Basic health

Population policies/programs and reproductive health
Water supply and sanitation
Government and civil society
Other Social Infrastructure

Employment
Housing
Other social services
ECONOMIC INFRASTRUCTURE AND SERVICES
Transport and storage
Communications
Energy generation and supply
Banking and financial services
Business and other services

PRODUCTION SECTORS

Agriculture, Forestry and Fishing

Agriculture
Forestry
Fishing

Industry, Mining and Construction

Industry
Mineral resources and mining
Construction

Trade and Tourism

Trade
Tourism

MULTISECTOR/CROSSCUTTING

General environmental protection
Women in development
Other multisector

COMMODITY AID AND GENERAL PROGRAMME ASSISTANCE

Structural adjustment assistance with World Bank/IMF
Development food aid/food security assistance
Other general program and commodity assistance

ACTION RELATING TO DEBT

Action relating to debt

EMERGENCY ASSISTANCE

Other emergency and distress relief

OTHER/UNALLOCATED/UNSPECIFIED

Administrative costs of donors

Unallocated/unspecified

GRAND TOTAL

2.053,27
269,44
55,02
21,81
89,42
103,19
196,43
96,76
99,67
170,06
100,91
880,23
436,20
10,15
9,71
416,34
614,81
318,72
10,31
104,90
120,88
60,00
924,83
359,84
111,94
29,54
218,36
382,20
180,09
202,03
0,08
182,79
165,15
17,64
719,44
85,13
14,32
619,99
1.272,21
619,21
477,50
175,50
88,67
88,67
613,39

613,39
246,11
141,86

104,25
6.532,73

256

Breakdown by budget line of external aid financed on the General Commission Budget in 2002

Total

Commitments

Payments

Managed by EuropeAid
Payments

Commitments

Managed by other DG's
Payments

Item
B7-01..
B7-02..
B7-03..
B7-04..
B7-20..
B7-21..
B7-30..
B7-31..
B7-32..
B7-4...
B7-42..
B7-51..
B7-52..
B7-53
B7-54..
B7-60..
B7-61..
B7-620.
B7-6211
B7-63..
B7-65..
B7-6610
B7-66..
B7-67..
B7-70..
B7-80..
B7-8710
B7-8...
B8-0…

Amounts in M€

Description
Pre-aaccession - SAPARD
Pre-accesssion - ISPA
Pre-accession - PHARE
Pre-accession - Malta, Cyprus, Turkey
Food Aid
Humanitarian Aid
Asia
Latin America
South Africa
Mediterranean
Near & Middle East
European Bank for Reconstruction & De
NIS & Mongolia - Tacis
NIS & Mongolia/CEEC's - Other actions
Western Balkans
Cofinancing NGOs
Training & public awareness
Environment/tropical forests
Global Health Fund
Social infrstructure and services
Coordination, evaluation
Anti-personnel mines
Other specific actions
Rapid reaction mechanism
Democracy & human rights
International fishing agreements
Bananas ACP
Other external chapters of Community p
Common Foreign & Security Policy (CF
 Total Title B7-B8

554,56
1.109,04
1.682,66
147,95
505,96
520,32
574,87
333,22
124,18
632,64
150,75
0,00
444,48
0,00
820,89
203,43
3,69
48,97
0,00
13,14
23,45
12,00
101,13
23,51
109,65
190,38
44,00
29,99
32,80
8.437,66

123,87
398,39
1.101,18
18,87
417,31
474,25
454,25
181,79
119,26
705,37
138,03
8,44
395,15
0,06
749,17
152,69
3,57
37,59
60,00
16,74
16,65
10,48
63,55
26,07
95,50
186,17
33,82
32,81
30,93
6.051,96

Commitments
554,56
1.109,04
1.682,66
147,95

123,87
398,39
1.101,18
18,87

520,32

474,25

505,96

417,31

574,87
333,22
124,18
632,64
150,75

454,25
181,79
119,26
700,67
138,03

431,98

383,66

12,50

619,17
152,69

163,00

4,70

8,44
11,49
0,06
130,00

657,89
203,43

48,97

13,14
23,45
12,00
31,74

109,65

44,00
0,39

37,59
60,00
16,74
16,65
10,48
18,44

95,50

33,82
4,52

3,69

3,57

69,39
23,51

45,11
26,07

190,38

186,17

29,60
32,80
4.539,40

28,29
30,93
2.591,39

3.898,26

3.460,57

Breakdown by instrument of development assistance financed from the European Development Fund (EDF) in 2002

Amounts in 

€ m

Instrument

Programmed aid
Structural Adjustment
Risk Capital
Interest Rebates
Emergency Aid
Aid to refugees
Sysmin
Stabex
HIPC
Envelope A - Cotonou
Envelope B - Cotonou
9th EDF Regional - Intra ACP

 Total EDF

Total

Commitments

Payments

Managed by EuropeAid
Payments

Commitments

Managed by other DGs
Payments

Commitments

636,04
44,35
174,42
6,40
7,48
51,84
-5,02
0,00
60,00
477,88
255,00
60,00
1.768,39

959,04
284,32
188,22
18,25
16,97
19,41
87,22
1,62
180,00
84,67
13,00
0,00
1.852,72

636,04
44,35
174,42
6,40
7,48
51,84
-5,02
0,00
60,00
477,88
255,00
60,00
1.768,39

959,04
284,32
188,22
18,25
16,97
19,41
87,22
1,62
180,00
84,67
13,00
0,00
1.852,72

0,00

0,00

Grand Total Budget + EDF

10206,05

7904,68

5666,65

5313,29

4539,40

2591,39

257

Breakdown by country/region of external aid financed from the general budget of the
Commission and the European Development Fund (EDF) in 2002

Total in M€
Commitments

Managed by EuropeAidManaged by Other DG's

Payments Commitment PaymentsCommitment Payments

1.133,18
47,58
136,28
59,00
59,35
10,23
10,40
66,15
149,45
531,91
62,83
2.482,23
365,41
66,58
80,69
124,30
93,84
2.116,82
93,68
6,85
29,69
150,59
53,00
24,06
10,52
15,05
4,33
0,57
156,55
24,64
31,78
13,68
0,45
26,98
210,13
38,53
0,33
39,56
12,47
49,92
-44,90
4,25
5,65
69,59
59,77
-9,66
142,13
4,11
0,00
221,62
5,13
63,33
9,51
55,23
0,08
2,34
36,87
4,44
19,35
63,55
129,11
17,76
12,95
24,79
18,36
44,22
44,02
30,39
89,47
545,20
294,85

1.073,75
32,49
131,16
19,43
56,71
12,27
11,96
59,87
145,51
553,61
50,74
2.366,90
339,73
62,03
62,21
123,93
91,56
2.027,17
66,37
35,59
4,05
75,68
39,36
42,58
12,11
6,47
47,08
2,40
77,15
8,36
16,75
2,05
4,63
16,32
129,40
20,65
7,15
53,42
52,62
23,79
21,73
14,62
9,81
54,81
58,78
69,31
131,69
15,47
0,12
148,69
22,19
42,24
11,92
45,42
0,06
2,77
60,82
3,47
24,95
24,92
123,60
19,77
5,71
92,68
4,37
53,37
118,93
22,19
78,78
408,13
242,85

698,85
45,77
88,79
59,00
37,50
0,78
10,40
0,00
21,22
372,56
62,83
2.146,89
350,06
52,24
80,69
123,29
93,84
1.796,83
64,65
6,85
29,69
150,59
35,50
24,06
9,16
15,05
4,33
0,22
124,55
24,64
29,32
13,68
0,45
26,98
206,13
36,97
0,33
39,56
4,13
39,92
-44,90
4,25
0,72
67,76
59,77
-9,66
56,13
3,90
0,00
221,62
5,13
63,33
9,51
55,23
0,08
1,36
20,12
0,98
10,19
58,50
129,11
-0,24
12,95
-2,21
18,36
43,80
44,02
28,39
51,87
523,30
287,61

787,15
28,88
109,21
18,36
46,45
0,23
11,55
1,23
141,41
379,09
50,74
2.071,97
324,55
48,27
62,21
122,95
91,12
1.747,42
38,40
35,59
4,05
75,68
24,08
42,58
11,26
6,17
47,08
1,78
41,82
7,48
14,36
2,05
4,62
15,64
127,25
19,25
7,15
53,42
45,11
13,95
18,32
14,62
9,43
53,61
57,75
69,31
45,69
14,98
0,12
147,90
22,16
42,24
11,92
45,22
0,06
2,14
47,21
0,47
15,08
21,42
123,20
5,21
5,15
65,35
4,36
52,77
116,88
17,68
78,40
383,05
232,30

434,33
1,81
47,49
0,00
21,85
9,45
0,00
66,15
128,23
159,35
0,00
335,34
15,35
14,34
0,00
1,01
0,00
319,99
29,03
0,00
0,00
0,00
17,50
0,00
1,36
0,00
0,00
0,35
32,00
0,00
2,46
0,00
0,00
0,00
4,00
1,56
0,00
0,00
8,34
10,00
0,00
0,00
4,93
1,83
0,00
0,00
86,00
0,21
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,98
16,75
3,46
9,16
5,05
0,00
18,00
0,00
27,00
0,00
0,42
0,00
2,00
37,60
21,90
7,24

286,60
3,61
21,95
1,07
10,26
12,04
0,41
58,64
4,10
174,52
0,00
294,93
15,18
13,76
0,00
0,98
0,44
279,75
27,97
0,00
0,00
0,00
15,28
0,00
0,85
0,30
0,00
0,62
35,33
0,88
2,39
0,00
0,01
0,68
2,15
1,40
0,00
0,00
7,51
9,84
3,41
0,00
0,38
1,20
1,03
0,00
86,00
0,49
0,00
0,79
0,03
0,00
0,00
0,20
0,00
0,63
13,61
3,00
9,87
3,50
0,40
14,56
0,56
27,33
0,01
0,60
2,05
4,51
0,38
25,08
10,55

Country/Region

Part I: Developing Countries & Territories 

Europe, Total

Africa, Total

Albania
Bosnia-Herzegovina
Croatia
fYR  Macedonia
Malta
Moldova
Slovenia
Turkey
Yugoslavia, Fed. Rep.
Europe Unalloc.

North Of Sahara, Total

Algeria
Egypt
Morocco
Tunisia

South Of Sahara, Total

Angola
Benin
Botswana
Burkina Faso
Burundi
Cameroon
Cape Verde
Central African Rep.
Chad
Comoros
Congo, Dem. Rep.
Congo, Rep.
Côte d'Ivoire
Djibouti
Equatorial Guinea
Eritrea
Ethiopia
Gabon
Gambia
Ghana
Guinea
Guinea-Bissau
Kenya
Lesotho
Liberia
Madagascar
Malawi
Mali
Mauritania
Mauritius
Mayotte
Mozambique
Namibia
Niger
Nigeria
Rwanda
St.Helena
Sao Tome & Principe
Senegal
Seychelles
Sierra Leone
Somalia
South Africa
Sudan
Swaziland
Tanzania
Togo
Uganda
Zambia
Zimbabwe
South Of Sahara Unalloc.

America, Total

North & Central, Total

258

Asia, Total

North & Central, Total

Anguilla
Antigua & Barbuda
Barbados
Belize
Costa Rica
Cuba
Dominica
Dominican Republic
El Salvador
Grenada
Guatemala
Haiti
Honduras
Jamaica
Mexico
Montserrat
Nicaragua
Panama
St.Kitts-Nevis
St.Lucia
St.Vincent & Grenadines
Trinidad & Tobago
Turks & Caicos Isl.
N. & C. America Unalloc.

Argentina
Bolivia
Brazil
Chile
Colombia
Ecuador
Guyana
Paraguay
Peru
Suriname
Uruguay
Venezuela
South America Unalloc.

South, Total

America Unspecified

Middle East, Total

Bahrain
Iran
Iraq
Jordan
Lebanon
Oman
Palestinian Admin. Areas
Saudi Arabia
Syria
Yemen
Middle East Unalloc.

South & Centr. Asia, Total

Afghanistan
Armenia
Azerbaijan
Bangladesh
Bhutan
Georgia
India
Kazakhstan
Kyrgyz Rep.
Maldives
Myanmar (Burma)
Nepal
Pakistan
Sri Lanka
Tajikistan
Turkmenistan
Uzbekistan
South & Central Asia Unalloc.

Far East, Total

Cambodia

294,85
2,36
0,21
-3,07
3,52
1,99
8,66
6,83
13,05
17,56
0,48
16,72
-20,25
44,78
69,32
7,22
3,64
16,21
0,42
0,02
8,88
5,66
3,99
0,00
86,65
124,99
3,85
20,72
10,70
2,74
19,13
6,80
8,65
2,35
7,98
0,14
2,15
22,01
17,77
125,36
1.432,49
410,07
0,00
2,05
13,17
93,32
20,37
0,00
231,07
0,00
36,57
10,95
2,57
625,02
247,59
36,62
34,35
31,58
4,20
18,19
13,84
0,68
20,99
0,00
14,44
22,33
90,13
21,49
17,00
0,00
0,00
51,59
311,36
30,29

242,85
0,01
0,04
0,75
3,11
1,51
6,03
9,64
31,28
24,80
0,67
34,05
17,18
25,35
21,73
6,28
0,13
35,83
1,52
1,40
6,30
0,02
1,48
0,34
13,40
128,29
5,18
23,98
16,38
7,55
18,47
9,95
3,60
11,47
17,06
2,79
2,73
8,88
0,25
36,99
1.091,00
307,17
0,00
3,36
12,85
56,02
23,33
0,00
181,48
0,00
11,76
18,37
0,00
477,06
152,50
30,64
23,74
26,25
3,55
11,52
103,28
6,05
13,61
0,00
9,23
14,23
45,25
13,31
13,60
2,49
7,81
0,00
245,96
29,47

287,61
2,36
0,21
-3,07
3,52
1,99
8,06
6,83
12,84
16,63
0,48
14,92
-20,65
43,72
69,32
6,22
3,64
14,97
0,42
0,02
8,88
5,66
3,99
0,00
86,65
110,33
3,85
20,01
10,35
2,74
9,52
5,14
8,65
1,43
6,57
0,14
2,15
22,01
17,77
125,36
1.180,66
354,80
0,00
1,55
0,00
92,75
15,50
0,00
197,07
0,00
36,00
9,36
2,57
496,59
180,90
30,62
34,35
31,58
4,20
16,09
8,84
0,68
20,99
0,00
10,94
18,04
77,24
10,53
0,00
0,00
0,00
51,59
243,23
23,22

232,30
0,01
0,04
0,75
2,87
1,47
3,86
9,64
30,92
21,81
0,67
32,57
16,98
24,80
21,70
5,11
0,13
34,51
1,52
1,40
6,30
0,02
1,48
0,34
13,40
113,76
5,18
23,23
15,67
7,55
10,52
8,33
3,60
10,44
15,04
2,79
2,73
8,43
0,25
36,99
881,11
269,00
0,00
2,79
0,30
55,13
18,85
0,00
163,43
0,00
11,28
17,22
0,00
371,57
89,88
18,26
23,49
25,73
3,55
10,21
100,75
6,05
13,55
0,00
7,76
12,03
40,66
6,43
2,92
2,49
7,81
0,00
179,74
21,09

7,24
0,00
0,00
0,00
0,00
0,00
0,60
0,00
0,21
0,93
0,00
1,80
0,40
1,06
0,00
1,00
0,00
1,24
0,00
0,00
0,00
0,00
0,00
0,00
0,00
14,66
0,00
0,71
0,35
0,00
9,61
1,66
0,00
0,92
1,41
0,00
0,00
0,00
0,00
0,00
251,83
55,27
0,00
0,50
13,17
0,57
4,87
0,00
34,00
0,00
0,57
1,59
0,00
128,43
66,69
6,00
0,00
0,00
0,00
2,10
5,00
0,00
0,00
0,00
3,50
4,29
12,89
10,96
17,00
0,00
0,00
0,00
68,13
7,07

10,55
0,00
0,00
0,00
0,24
0,04
2,17
0,00
0,36
2,99
0,00
1,48
0,20
0,55
0,03
1,17
0,00
1,32
0,00
0,00
0,00
0,00
0,00
0,00
0,00
14,53
0,00
0,75
0,71
0,00
7,95
1,62
0,00
1,03
2,02
0,00
0,00
0,45
0,00
0,00
209,89
38,17
0,00
0,57
12,55
0,89
4,48
0,00
18,05
0,00
0,48
1,15
0,00
105,49
62,62
12,38
0,25
0,52
0,00
1,31
2,53
0,00
0,06
0,00
1,47
2,20
4,59
6,88
10,68
0,00
0,00
0,00
66,22
8,38

259

China
East Timor
Indonesia
Korea, Dem.
Laos
Malaysia
Mongolia
Philippines
Thailand
Viet Nam
Far East Asia Unalloc.

Oceania, Total

Asia Unspecified

Fiji
Kiribati
Micronesia, Fed. Sts.
Nauru
Niue
Palau
Papua New Guinea
Samoa
Solomon Islands
Tokelau
Tonga
Tuvalu
Vanuatu
Wallis & Futuna
Oceania Unalloc.

UNRWA
WFP
HIPC
GHF
UNHCR

LDC's Unspecified
Multilateral aid

Part I (ODA), Total

More Advanced Developing Countries

Part II: Countries and Territories in Transition - Official Aid (OA) 

Aruba
Bahamas
Bermuda
Brunei
Cayman Islands
Chinese Taipei (Taiwan)
Cyprus
Falkland Islands
French Polynesia
Gibraltar
Hong Kong, China
Israel
Korea
Kuwait
Libya
Macao
Netherlands Antilles
New Caledonia
Northern Marianas
Qatar
Singapore
United Arab Emirates
Virgin Islands (UK)
MADCT Unallocated

Belarus
Bulgaria
Czech Republic
Estonia
Hungary
Latvia
Lithuania
Poland
Romania
Russia
Slovak Republic
Ukraine
CEEC's Unallocated
NIS Unallocated
CEEC's/NIS Unallocated
European Bank for Reconstruction & D

CEEC's/NIS

Part II (OA), Total

31,24
29,19
77,12
58,69
10,10
0,04
6,75
6,49
15,47
30,49
15,49
86,04
75,10
10,24
0,00
0,00
0,00
0,00
0,00
54,60
4,32
-0,01
0,00
0,00
0,73
2,48
0,00
2,74
563,53
301,00
70,00
100,00
60,00
60,00
11,00
6.532,73

16,71
0,00
0,00
0,00
0,00
0,00
0,00
11,50
0,00
0,00
0,00
0,00
1,88
0,00
0,00
0,00
0,00
3,73
-0,40
0,00
0,00
0,00
0,00
0,00
0,00
3.656,61
0,00
283,67
208,97
77,27
266,57
105,74
239,17
995,17
696,63
126,97
153,60
88,32
254,65
159,88
0,00
0,00
3.673,32

33,12
22,47
25,41
64,94
9,13
0,41
3,26
21,72
14,19
19,10
2,74
60,81
35,73
1,04
0,91
0,00
0,00
0,00
0,00
12,82
6,86
4,51
0,00
0,75
0,34
4,46
0,05
3,99
568,41
376,38
63,43
72,95
180,00
60,00
0,00
5.920,30

26,47
0,57
0,17
0,00
0,03
0,00
0,00
11,63
0,00
2,15
0,00
0,00
8,24
0,00
0,00
0,00
0,66
1,22
1,80
0,00
0,00
0,00
0,00
0,00
0,00
1.957,91
1,38
137,20
113,97
38,05
124,14
49,12
97,70
512,55
233,72
121,01
116,74
62,08
146,63
194,54
0,64
8,44
1.984,38

26,79
28,51
70,02
17,66
8,97
0,04
6,75
6,49
10,00
29,29
15,49
86,04
75,10
10,24
0,00
0,00
0,00
0,00
0,00
54,60
4,32
-0,01
0,00
0,00
0,73
2,48
0,00
2,74
404,71
290,00
70,00
100,00
60,00
60,00
0,00
5.319,51

5,21
0,00
0,00

0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
1,88

0,00
3,73
-0,40

341,93
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,81
0,00
92,92
0,00
88,32
0,00
159,88
0,00
0,00
347,14

30,13
22,47
16,86
26,10
8,30
0,40
3,23
20,73
9,34
18,35
2,74
60,80
35,65
0,96
0,91
0,00
0,00
0,00
0,00
12,82
6,86
4,51
0,00
0,75
0,34
4,46
0,05
3,99
417,05
376,38
63,43
72,95
180,00
60,00
0,00
4.952,36

12,57
0,57
0,00

0,03
0,00
0,00
0,87
0,00
2,15
0,00
0,00
5,27

0,66
1,22
1,80

4,45
0,68
7,10
41,03
1,13
0,00
0,00
0,00
5,47
1,20
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
158,82
11,00
0,00
0,00
0,00
0,00
11,00
1.213,22

11,50
0,00
0,00

0,00
0,00
0,00
11,50
0,00
0,00
0,00
0,00
0,00

0,00
0,00
0,00

2,99
0,00
8,55
38,84
0,83
0,01
0,03
0,99
4,85
0,75
0,00
0,01
0,08
0,08
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
0,00
151,36
0,00
0,00
0,00
0,00
0,00
0,00
967,94

13,90
0,00
0,17

0,00
0,00
0,00
10,76
0,00
0,00
0,00
0,00
2,97

0,00
0,00
0,00

348,36
1,22
0,73
1,28
0,13
0,20
0,13
0,26
0,11
0,42
86,92
0,33
61,40
0,27
194,38
0,58
0,00
360,93

3.314,68
0,00
283,67
208,97
77,27
266,57
105,74
239,17
994,36
696,63
34,05
153,60
0,00
254,65
0,00
0,00
0,00
3.326,18

1.609,55
0,16
136,47
112,69
37,92
123,94
48,99
97,44
512,44
233,30
34,09
116,41
0,68
146,36
0,16
0,06
8,44
1.623,45

Grand Total Part I & Part II (ODA+OA)

10.206,05

7.904,68

5.666,65

5.313,29

4.539,40

2.591,39

260

Breakdown by sector of Official Development Assistance (ODA)
financed on the General Commission Budget and the European Development Fund
(EDF) in 2002

Sector of Destination

Total

Amount of Commitments in € million+D2

1.982,55
253,94
52,32
21,81
89,42
90,39
196,43
96,76
99,67
170,06
92,88
875,83
393,41
10,15
9,71
373,55
585,89
310,67
9,44
84,90
120,88
60,00
720,28
163,23
105,18
29,54
28,51
382,20
180,09
202,03
0,08
174,85
157,21
17,64
520,84
72,57
14,32
433,95
1.091,85
614,35
477,50

Managed by EuropeAid Managed by Other DG's
70,72
15,50
2,70
0,00
0,00
12,80
0,00
0,00
0,00
0,00
8,03
4,40
42,79
0,00
0,00
42,79
28,92
8,05
0,87
20,00
0,00
0,00
204,55
196,61
6,76
0,00
189,85
0,00
0,00
0,00
0,00
7,94
7,94
0,00
198,60
12,56
0,00
186,04
180,36
4,86
0,00
175,50
0,00
0,00
489,75

88,67
88,67
123,64

123,64
205,79
135,54

70,25
5.319,51

489,75
40,32
6,32

34,00
1.213,22

SOCIAL INFRASTRUCTURE AND SERVICES

Education

Health

Education, level unspecified
Basic education
Secondary education
Post-secondary education

Health, general
Basic health

Population policies/programs and reproductive health
Water supply and sanitation
Government and civil society
Other Social Infrastructure

Employment
Housing
Other social services
ECONOMIC INFRASTRUCTURE AND SERVICES
Transport and storage
Communications
Energy generation and supply
Banking and financial services
Business and other services

PRODUCTION SECTORS

Agriculture, Forestry and Fishing

Agriculture
Forestry
Fishing

Industry, Mining and Construction

Industry
Mineral resources and mining
Construction

Trade and Tourism

Trade
Tourism

MULTISECTOR/CROSSCUTTING

General environmental protection
Women in development
Other multisector

COMMODITY AID AND GENERAL PROGRAMME ASSISTANCE

Structural adjustment assistance with World Bank/IMF
Development food aid/food security assistance
Other general program and commodity assistance

ACTION RELATING TO DEBT

Action relating to debt

EMERGENCY ASSISTANCE

Other emergency and distress relief

OTHER/UNALLOCATED/UNSPECIFIED

Administrative costs of donors

Unallocated/unspecified

GRAND TOTAL

2.053,27
269,44
55,02
21,81
89,42
103,19
196,43
96,76
99,67
170,06
100,91
880,23
436,20
10,15
9,71
416,34
614,81
318,72
10,31
104,90
120,88
60,00
924,83
359,84
111,94
29,54
218,36
382,20
180,09
202,03
0,08
182,79
165,15
17,64
719,44
85,13
14,32
619,99
1.272,21
619,21
477,50
175,50
88,67
88,67
613,39

613,39
246,11
141,86

104,25
6.532,73

261

8.1.

COMMITMENTS 2002 WESTERN BALKANS

Conflict prevention, Good governance and Rule of law

Country

Project Title

Amount

(€ million)

Albania

Albania

Judicial Reform

Police and organised crime

Bosnia and Herzegovina

Policing

Bosnia and Herzegovina

Administration of justice

Croatia

Croatia

FYR Macedonia

FYR Macedonia

Kosovo

Kosovo

Serbia

Total

Police and organised crime

Modernisation of justice

Fight against crime

Promotion of inter ethnic relations

Legal aid in civil matters

Rehabilitation  and  equipping  of
judicial buildings

Support for judiciary

8.0

14.0

5.0

7.5

2.0

4.0

1.0

1.2

2.0

5.0

3.0

52.7

262

European Initiative for Democracy and Human Rights

Region

Country

Project

Amount (€)

Western Balkans

FRY/Kosovo

Regional

Croatia, Serbia, Bosnia
and Herzegovina,
Kosovo, Bulgaria,
Poland, Ukraine,
Russia, Georgia,
Armenia

Western Balkans

FRY

Western Balkans

Bosnia and
Herzegovina

Western Balkans

FRY/Serbia

Regional

fYR Macedonia,
Serbia, Bulgaria,
Hungary, Poland,
Russia

Western Balkans

Kosovo

Western Balkans

Western Balkans

Bosnia and
Herzegovina

Bosnia and
Herzegovina

Western Balkans

Albania

Towards a mutually
tolerant society with all
the ethnic groups

Improving indigenous
multiculturalism
through education

Improving the rights of
Roma

Reinforcing the
participation of
minorities in local
governments

Promotion of inter-
ethnic relations

434.547

901.489

718.150

520.000

776.35

Prevention of torture

972.731

Rehabilitation of
victims of torture

Rehabilitation of
victims of torture

Rehabilitation of
victims of torture

Rehabilitation of
victims of torture

Regional

Bosnia and
Herzegovina, Croatia,
fYR Macedonia,
FRY/Serbia et Kosovo,
Romania, Bulgaria

Stability Pact and the
Roma - use your vote
with wisdom

Western Balkans

Bosnia and
Herzegovina

Aptitude to supervise
and implement the
rights of children

Western Balkans

Bosnia and
Herzegovina

Respect of the post-
accession engagements

263

328.701

460.000

428.643

290.951

300.000

600.000

750.000

Western Balkans

FRY

Western Balkans

Regional

Western Balkans

ARYM

Western Balkans

Bosnia and
Herzegovina, Croatia,
Kosovo, Serbia

in the Council of
Europe and Developing
and Maintaining
democratic institutions

Support to the
accession process in
the Council of Europe
and in the regional
development of the
democratic institutions

Implementation
instruments for the
national strategies for
Roma minorities

 Support to the
Electoral Observation
Mission of the
OSCE/ODHIR

Support to the Regional
Offices of the
International Criminal
Court for ex-
Yugoslavia

750.000

300.000

506.000

640.000

Western Balkans

Bosnia and
Herzegovina

Micro-projects

500.000

Western Balkans

FRY

Micro-projects

500.000

TOTAL

10.677.647

264

CARDS Institution building

Institution

Country

Project Title

Amount

(€ million)

State Institutions

Albania

Support  for  procurement,  competition
and statistics

Tax and customs
administration

Public procurement

Bosnia 
Herzegovina

Bosnia 
Herzegovina

State Institutions

Croatia

Regional Institutions

Croatia

Public Finance

Croatia

and

Introduction of modern practices

and

Improve accountability and efficiency

Implementation of the Stabilisation and
Association Agreement

Strategy  and  capacity  building  for
regional development

Development  of  financial  controls,
debt management and customs systems

Public Administration

Kosovo

General and health reforms

Montenegrin 
Government

Republican

Montenegro

Public administration reform

Public Administration

Serbia

General and health reforms

Total

6.0

9.0

1.5

6.0

2.0

4.0

14.7

2.0

17.0

62.2

265

CARDS Regional cooperation and integration 2002 (€ million)

Project Title

Commitment

Integrated Border Management

Institution Building

Democratic Stabilisation

Regional Infrastructure

Other

Total

1.0

19.4

7.6

14.0

1.5

43.5

266

CARDS Transport and Infrastructure, including Energy

Country

Project Title

Amount

(€ million)

Kosovo

Kosovo

Kosovo

Kosovo

Assistance to energy production, transmission and
distribution networks

Directorate of roads

Pristina to Skopje road rehabilitation

Access roads to ethnic minority enclaves

Montenegro

Road rehabilitation

Montenegro

Railway rehabilitation

Montenegro

Technical assistance to the electricity sector

Montenegro

Emergency rehabilitation of electricity distribution
systems

Serbia

Serbia

Serbia

Serbia

Serbia

Serbia

Total

Energy efficiency agency

Energy regulatory agency

Generation, transmission and consultancy

Nikola Tesla A3 thermal power plant

Reconstruction of the Sloboda Bridge

Transport  sector  investment  capacity  building
measures

55.0

1.0

4.0

1.0

0.7

1.5

1.0

1.6

5.0

4.0

8.0

50.0

41.0

3.0

176.8

267

CARDS Food safety and Rural development

Country

Project Title

Albania

Kosovo

Kosovo

Kosovo

Total

Local community development

Agricultural and agro-processing credit

Strengthening of public veterinary services

Agricultural statistics and policy advisory unit

Amount

(€ million)

7.4

4.1

2.4

2.5

18.4

268

CARDS Education

Country

Project Title

Amount

(€ million)

Albania

Albania

Tempus

Support  to  vocational  education  and
training reform

Bosnia and Herzegovina

Tempus

Croatia

Croatia

FYR Macedonia

Montenegro

Serbia

Serbia

Total

Vocation  training  and  educational
mobility

Tempus

Tempus

Tempus

Tempus

Vocational education and training

2.0

1.5

2.4

6.0

3.0

3.0

0.5

4.0

2.0

24.4

269

CARDS Environment

Country

Project Title

Amount

(€ million)

2.5

0.9

0.6

2.0

2.0

2.0

1.2

1.6

2.4

2.6

1.7

0.5

20.0

Albania

Albania

Albania

Bosnia and Herzegovina

Environment  legislation  and  awareness
raising

Pollution  abatement  and  control  at
Ballshi Refinery

Design  of  a  secure  landfill  site  for
hazardous waste

Development  of 
environmental regulatory framework

comprehensive

a 

Bosnia and Herzegovina

Water resources management

Bosnia and Herzegovina

Solid waste management

Croatia

Croatia

Kosovo

Kosovo

Montenegro

Serbia

Total

Strategy for environmental law

Waste  management  and  water  info.
System

Strategic management support to public
utility service providers

River  gauging  and  rehabilitation  of  ash
dumps and Mitrovica

Sewerage  and  waste  water  feasibility
and treatment

Assist  in  institutional  capacity  building
to strengthen environmental protection

270

CARDS Partnership with NGOs

Country

Project Title

Albania

Croatia

Develop civil society and NGO capacity

Support to environmental NGOs

FYR Macedonia

Support to Civil Society/Strengthening NGOs

Total

Amount

(€ million)

1.0

0.2

1.8

3.0

271

CARDS Linking relief, Rehabilitation and Development

Country

Project Title

Bosnia and Herzegovina

Croatia

Total

Return  of  refugees  and  displaced
persons

Return  of  refugees  and  displaced
persons

Amount

(€ million)

23.5

14

37.5

272

8.2.

COMMITMENTS 2002 EASTERN EUROPE AND CENTRAL ASIA

Conflict prevention, Good governance and Rule of Law

Country

Azerbaijan

Georgia

Russia

Ukraine

Total

Amount

(€ million)

4.8

3.7

7.0

1.0

16.5

Region

Regional

European Initiative for Human Rights and Democracy

Country

Project

Amount (€)

Russia, Ukraine,
Georgia, Armenia,
Croatia, Serbia, Bosnia
and Herzegovina,
Kosovo, Bulgaria,
Poland

Improving indigenous
multiculturalism
through education

901.489

Caucasus

Armenia, Azerbaijan,
Georgia

Training media,
reinforcing minorities

Eastern Europe

Russia

Eastern Europe

Eastern Europe

Russia

Russia

Eastern Europe

Russia

Caucasus

Georgia

Information campaign
on fight against racism
and xenophobia

Reinforcing diversity

Educating indigenous
people in Siberia

Access to justice for
ethnic minorities

Inter-communal youth
centres

1.168.326

1.138.112

635.839

762.300

572.550

672.000

Regional

Regional

Russia, FYROM,
Serbia, Bulgaria,
Hungary, Poland

Russia, Lettonia,
Lithuania, Estonia

Prevention of torture

972.731

Prevention of torture

724.628

273

Caucasus

Eastern Europe

Georgia

Ukraine

Eastern Europe

Russia

Eastern Europe

Russia

Caucasus

Georgia

Prevention of torture

Campaign against
torture

Reinforcing federalism,
democracy and
mechanisms of
protection of Human
Rights

Continuation of the
support to the Moscow
School of Political
Studies

Improving the
functioning of the
political institutions
and reinforcing the
mechanisms of
protection of human
rights

Eastern Europe Central
Asia

Kazakhstan,
Kyrgyzstan,
Uzbekistan, Tajikistan,
Turkmenistan,
Mongolia

Information campaign
on the International
Crime Tribunal and the
ratification of the
Statute of the Tribunal

301.510

685.026

500.000

299.229

750.000

518.169

Caucasus

Eastern Europe

Eastern Europe

TOTAL

Georgia

Russia

Ukraine

Micro-projects

500.000

Micro-projects

1.000.000

Micro-projects

600.000

12.701.909

Country

Armenia

Mongolia

Russia

Ukraine

Total

Institution building

Amount

(€ million)

5.1

0.6

19.0

23.0

47.7

274

Regional cooperation

Country

Commitement

(€ million)

Regional cooperation

Cross border cooperation

Baltic cooperation

Support to national coordination units

EU/EBRD investment preparation facility

Nuclear safety

Central Asia

Chernobyl shelter

Total

37.0

27.5

8.0

5.0

10.0

56.0

50.0

20.0

213.5

Transport and Infrastructure, including Energy

Transport and infrastructure

Country

Energy

Total

Russia

Food safety and Rural development

2002 Commitments (€ million)

Amount

(€ million)

6.0

6.0

Country

Food safety/rural
development

Amount
(€ million)

Mongolia

Rural development

Total

4.5

4.5.

275

Country

Armenia

Azerbaijan

Georgia

Mongolia

Russia

Ukraine

Total

Country

Russia

Total

Health & Education

Amount

(€ million)

3.6

1.4

6.0

0.9

17.5

13.5

42.9

Environment

Amount

(€ million)

24.0

24.0

8.3

COMMITMENTS  2002  MEDITERRANEAN  AND  NEAR  AND  MIDDLE
EAST

Projects committed in 2002 per sector and per budget heading

Regional cooperation

Information and Communication Programme (B7-410 MEDA)

Good Governance and Improvement of the Law (B7-410 MEDA)

Middle East Peace Project (B7-410 MEDA)

Subtotal

Technical assistance (B7-410 MEDA)

Total

Amount
(€ million)

10

6

2.6

18.6

10.8

29.4

276

Region

Regional

European Initiative for Democracy and Human Rights
Commitments 2002 (B7-7010)

Country

Project

Amount in €

Palestine, Lebanon, Malta,
Libya, Egypt, Algeria,
Tunisia, Morocco, Turkey,
Cyprus, Jordan, Israel

Master’s in Human Rights
and Democratisation

782 792

Regional

Egypt, Jordan, Lebanon,
Gaza and the West Bank

Promotion of women’s
rights

Maghreb

Tunisia

Middle East

Iran

Middle East

West Bank, Gaza Strip

Middle East

Middle East

Middle East

Middle East

Middle East

Middle East

Israel

Israel

Israel

Israel

Israel

Israel and Palestinian
Territories

890 000

716 800

298 514

260 000

659 460

897 937

Strengthening the labour-
movement

EU-Iran: dialogue on
human rights

Legal emergency aid for
the Palestinian prisoners
in the Israeli military
detention centres

Strengthening the
Bedouin community

Combating discrimination
against Palestinian
citizens in Israel

Campaign against racism

650 000

Equal rights for Bedouin
citizens

Mixed cities: equal access
to housing

300 360

790 666

Stopping torture

745 000

Middle East

The West Bank, Gaza

Middle East

West Bank, Gaza Strip

Europe

Turkey

Europe

Turkey

Rehabilitation of the
victims of torture

Rehabilitation of the
victims of torture

Rehabilitation of the
victims of torture

Role of justice in the
prevention of torture

Middle East

Arab region

Strengthening the role of
civil society in political

361 326

649 383

700 000

360 374

800 000

277

reform and human rights

Regional

Algeria, Bahrain, Morocco,
Lebanon, Jordan, Yemen,
Egypt, Palestine, Mauritania

Help civil society to fight
corruption in the Arab
world

705 000

Middle East

The West Bank, Gaza

EU electoral observation
mission

2 500 000

Maghreb

Maghreb

Europe

TOTAL

Algeria

Tunisia

Turkey

Microprojects

Microprojects

Microprojects

Country

Institutional building

Jordan

Morocco

Tunisia

Lebanon

Support programme for the implementation of
Association Agreement (B7-410 MEDA)

Support programme for the implementation of
Association Agreement (B7-410 MEDA)

Support programme for the implementation of
Association Agreement (B7-410 MEDA)

Support programme for the implementation of
Association Agreement (B7-410 MEDA)

West Bank and
Gaza Strip

Empowering the Palestinian Judicial System (B7-
420 Palestine)

Tunisia

West Bank and
Gaza Strip

West Bank and
Gaza Strip

Jordan

Increasing professional skills of journalists (B7-410
MEDA)

Global Allocation - Technical Assistance and
Studies (B7-420 Palestine)

Direct Budgetary Assistance (B7-410 MEDA)

Institutional Support of Aqaba Special Economic
Zone (AZESA) (B7-410 MEDA)

West Bank and
Gaza Strip

Capacity Building for the Palestinian System (B7-
420 Palestine)

Total

500 000

250 000

600 000

14 417 612

Amount
(€ million)

20

5

20

12

7

2.2

5.5

100

10

0.3

182

278

Country

Transport and Infrastructure

West Bank and
Gaza Strip

Emergency Municipal Support Programme (B7-720
Palestine)

Tunisia

Support to the modernisation of ports (B7-410
MEDA)

Total

Country

Rural development

Morocco

Total

Arganier (B7-410 MEDA)

Amount
(€ million )

30

20

50

Amount
(in million
€)

6

6

Food security projects committed in 2002 in the West Bank and Gaza Strip (B7-2010)

Country

Title of project

Contract
Holder(s)

West Bank &
Gaza

WFP - Food Aid contribution to emergency operation
in support of civil population

World Food
Programme

Amount
Committed
(€)

5 000 000

West Bank &
Gaza

Enhancing productive cooperatives among farmers and
creating cooperative saving and credit funds

ACAD

1.363.565

West Bank &
Gaza

localised  composting  network  for  Bethlehem

A 
District, West Bank

ARIJ

520.515

West Bank &
Gaza

Provision  of  livestock  services  for  sustainable  small
ruminants production in northern West Bank

VSF

886.500

West Bank &
Gaza

Production  of  fresh  and  pasteurised  milk  in  Khan
Younis municipality- Gaza Strip

CRIC

607.790

TOTAL

8.378.370

1

2

3

4

5

279

Country

Health

Amount
(€ million )

Syria

West Bank and Gaza
Strip

West Bank and Gaza
Strip

West Bank and Gaza
Strip

Health Sector Modernisation (B7-
410 MEDA)

Health Sector Review / Health
Sector Support Programme (B7-420
Palestine)

Emergency Support for Palestinian
Hospitals East Jerusalem (B7-420
Palestine)

Emergency Support to the
Palestinian Ministry of Health (B7-
420 Palestine)

30

5

5

10

50

Total

Country

Egypt

Morocco

Total

Vocational training

Amount (€ million)

Assistance to the Reform of the
Technical and Vocational Training
System (B7-410 MEDA)

Support to the upgrading of
Vocational Training (B7-410
MEDA)

33

50

83

280

Country

Macroeconomic policies

Amount
(€ million)

60

20

50

61

6

5

10

7

0.5

219.5

Amount
(€ million)

25

25

Jordan

Egypt

Tunisia

Morocco

Syria

West Bank
and Gaza
Strip

West Bank
and Gaza
Strip

Yemen

Yemen

Total

Structural Adjustment
Facility - SAF III (B7-410
MEDA)

Enhancement programme B
(B7-410 MEDA)

Industrial Modernisation
programme (B7-410
MEDA)

Enterprise support
programme (B7-410
MEDA)

Industrial Modernisation
programme (B7-410
MEDA)

Emergency Support to the
SMEs of East Jerusalem
(B7-420 Palestine)

Emergency Support to the
SMEs of East Jerusalem
(B7-420 Palestine)

Support to Yemen
Accession to WTO (B7-432
Yemen)

Technical Assistance (B7-
432 Yemen)

Country

Environment

Egypt

Total

Water treatment (B7-410
MEDA)

281

Partnership with NGOs

Partnership with NGO's

Country

Project

Care Oesterreich 

Egypt

Safe Agriculture for Farmers 

West 
Bank and 
Gaza 
Strip

Supporting Palestinian Businesswomen 

Israel

Development and Empowerment: a partnership with the Arab Community of Israel 

Fundacion CODESPA - Futuro en 
marcha 

Heinrich-Boell-Stiftung 

Ricerca e Cooperazione - 
Associazione per la Ricerca, la 
Documentazione e il Lavoro 
Volontario 

Comitato Internazionale per lo 
Sviluppo Dei Popoli 

Y Care International

Secours Populaire Français 

Asamblea de Cooperacion por la 
Paz 

Comitato Europeo per la 
Formazione e l'Agricoltura 

Enfants réfugiés du Monde 

Movimento Africa 70

Yemen

Last Chance to Freedom - Reintegration into civil society of women, children and minors in conflict with the law

749.000

Lebanon Improving Health Assistance for Palestinian Refugees 

Lebanon Lebanon YMCA Accelerated Vocational Training Programme

Tunisia

Mise en place d'un centre médico-psychopédagogique accueillant et prenant en charge en externe des enfants 
souffrant de troubles du comportement

West 
Bank and 
Gaza 
Strip

Mejora de la asistencia terapeutica y la insercion social y familiar de discapacitados en los distritos de Qalqylia, 
Hebron y Tulkarem 

Morocco Projet de développement agricole intégré dans les communes rurales de Sidi Boumahdi et de Meskoura 

Algeria

Programme de soutien psychosocial et éducatif pour les enfants réfugiés Sahraouis (6-12 ans) dans les centres 
d'animation et dans les écoles primaires

Algeria

Salud animal en la tiendopoli Saharawi 

Fondazione Terre Des Hommes 
Italia Onlus

West 
Bank and 
Gaza 
Strip

Empowering Children and Youth in Al-Am'Ari Refugee Camp through increased access to educational 
opportunities, the strenghtening of targeted organizations, and increased Children and Youth competencies 

Associazione Amici dei Bambini 

Morocco

Prevention of Child Abandonment, Development of sustainable health and Promotion of social education inclusion 
for disabled Children 

Association DIA

Horizont 3000

Plan International UK

QUESTSCOPE

Save the Children Fund  

Yemen

Programme d'assistance et d'intégration des populations défavorisées de la ville de Taiz 

Egypt

Community Development by Women Empowerment and Elimination of Discrimination against Women in Rural 
Areas of Upper Egypt

Egypt

Child Focused Community Rehabilitation Programme

Jordan

Rebuilding the Right Environment to Respond to Marginalized Children by restoring their Neglected Rights to 
Education, Livelihood Options and Support in their transition from Adolescence to Young Adulthood

Egypt

Developing More Inclusive Educational Institutions for Pre-school and Primary School Children 

Lebanon Insertion des jeunes en difficulté 

TOTAL 

Country

Civil society

Algeria

Jordan

Yemen

West Bank
and Gaza
Strip

Total

Support to local socio-
economic development in
the north-east of Algeria
(B7-410 MEDA)

Promotion of Human Rights
and Democratisation (B7-
410 MEDA)

Electoral Support Project
(B7-432 Yemen)

Financial Support to
Palestinian electoral process
(B7-420 Palestine)

282

Amount (€)

705.164

402.890

738.165

746.310

736.834

692.723

601.211

750.000

750.000

596.915

558.550

544.741

614.555

494.274

737.704

749.695

750.000

2.016.455

13.935.186

Amount
(€ million)

50

2

0.5

10

62.5

Organisation

United Nations
Relief and Work
Agency

Total

Refugees /
Population

11th Convention 2002
(B7-421 UNRWA)

8.4

COMMITMENTS 2002 - ACP

Conflict prevention, Good governance, Rule of law

Region

ACP country

Project

Caribbean
Pacific

West Africa

Central Africa

&

Eastern 
Southern
Africa,  Indian
Ocean

Haiti
Vanuatu
Sudan
Côte d’Ivoire
Nigeria

Togo

Sierra Leone
Central  African
Republic

Congo-
Brazzaville
Eritrea, Ethiopia
Madagascar
Somalia

National census
Supporting elections
Maintaining cease-fire agreement
Regionally-sponsored peace talks
Supporting elections
Local government training
Improving treatment of prisoners
National census
African Union-sponsored peace talks
National census
Supporting  elections,  protecting  human
rights
Peace process projects, mine clearance
Supporting elections
Peace talks in Kenya

*Sub-total (EC budget)

Sub-total (EDF)

Total

Amount
(€ million)

55

55

Amount

(€ million)

0.8
0.7
1.1*
0.5*
6.5
1.3
2.0
5.5
0.4*
1.5
14.3

1.0*
0.2
0.5*

3.5

32.8

36.3

283

Institution-building

Region

Country

Project

Caribbean

Antigua  &
Barbuda

Supporting National Authorising Officer

Haiti

Mission to Organisation of American States

Trinidad  &
Tobago

Supporting the National Authorising Officer

Pacific

Vanuatu

Supporting Non State Actors

West Africa

Benin

Guinea

Ivory Coast

Supporting the Launch of Communes

Supporting the National Authorising Officer

Supporting the National Authorising Officer

Management of public expenses

Nigeria

Economic Management Capacity Project

Sierra Leone Supporting the National Authorising Officer

Central Africa

Togo

Central
African
Republic

Gabon

Supporting NGOs and civil society

Supporting National Authorising Officer

Supporting the National Authorising Officer

Eastern 
Southern
Africa 
Indian Ocean

&

Angola

Supporting the National Institute of Statistics

&

Congo

Human Rights, democratisation, elections

Dem. Rep. of
Congo

Ethiopia

Namibia

South Africa

First Institutional Support Programme

Financial Information System

Development Planning & Non State Actors

Reconstruction and Development

Conflict and Governance Fund (CAGE)

Sudan

Consultancy Non State Actors

Pacific Region

Supporting the Regional Authorising Officer

All  Overseas  Countries  &
Territories

OCT/EU Annual Forum

All ACP countries

Audit - FED Interests

Total

Amount

(€ million)

0.3

0.8

0.6

0.6

8.9

3.0

2.0

1.9

2.0

0.2

1.3

2.0

0.2

1.9

14.3

16.0

9.0

3.2

4.8

4.0

0.1

1.3

0.8

5.0

84.2

284

Region

Country

Project

Transport

Antigua
Benin
Burkina Faso
Guinea Bissau
Mauritania
Senegal

Sierra Leone
Central  African
Republic
Congo (DRC)
Djibouti
Ethiopia
Ethiopia
Malawi
Rwanda

Uganda
Zambia
Anguilla
Montserrat

Reconstructing harbour
Constructing Cotonou bypass
Planning construction of roads
Maintaining road network
Planning construction of roads
Training  &  funding  government  transport
departments
Constructing Freetown-Conakry highway
Supporting road maintenance
Bouar – Garoua Boulaï road
Repairing road network
Constructing roads in cities
Constructing Addis Abeba - Jima road
Constructing Kombolcha - Mille road
Constructing Karonga – Chiveta road
Training  &  funding  government  transport
departments
Constructing Kampala bypass
Repairing Livingstone & Lusaka airports
Repairing road network
Constructing new airport

Caribbean
West Africa

Central
Africa

Eastern  &
Southern
Africa,
Indian Ocean

Overseas
countries  &
territories

Total

Amount

(€ million)

2.0
3.8
1.4
35.0
3.5
8.0

10.0
3.2
55.0
80.0
11.6
17.0
30.0
5.0
29.9

41.0
11.3
1.8
2.1

351.6

285

Infrastructure and Energy

Region

Country

Project

Guyana
Haiti
St. 
Grenadines
Papua New Guinea

Vincent 

&

Building low-income housing
Using satellite imaging for planning
Constructing tertiary-level college

Mining sector support

Caribbean

Pacific

Benin

Infrastructure preparatory study

Burkina Faso

Repairing & maintaining roads

Ghana

Mining sector support

Guinea -Conakry

Re-equipping training institute

West Africa

Mauritania

Repairing Nouadhibou port

Niger

Strengthening  &  diversifying  mining
sector

Sierra Leone

Reopening titanium ore mine

Sierra Leone

Central Africa Gabon

Botswana

South Africa

Zambia

New Caledonia

&

Eastern 
Southern
Africa,  Indian
Ocean

Overseas
countries  &
territories
Total

Repairing  energy 
distribution networks

transmission  &

Mining sector support
Economic diversification of the mining
sector
Funding  development  in  Durban  &
surrounds
Developing & repairing urban markets
Constructing three fishing ports

Amount

(€ million)

9.1
0.8
1.5

50.0

2

5

40

1.3

45.0

35.0

25.0

2.0

35.0
30.0

35.0

16.5
2.8

336

286

Food security and rural development

Region

Country

Project

Caribbean

Several

Raising banana production efficiency

Several (RIP)

Expanding rice production

Cuba

Haiti

Cuba

Vaccinating against porcine flu

Supporting  School  canteens,  reinforcing
food security governance

Reinforcing  food  security 
province

in  Oriente

West Africa

Several

Training banana producers

Several (RIP)

HUB rural development

Benin

Niger

Rural development

Improving food security

Central Africa

Chad

Implementing forestry programmes

Cameroon

Raising banana production efficiency

Several

Raising banana production efficiency

Eastern 
&
Southern Africa,
Indian Ocean

Several (NIP)

Seven projects

Several (RIP)

Land & water research

Several (RIP)

Devising a fisheries management plan

Several (RIP)

Devising  an  integrated  pest  management
programme

Eritrea

Supplying 24,000 tonnes of cereals

Ethiopia

Supplying 183,000 tonnes of cereals

Malawi

Supplying 40, 000 tonnes of corn

Mozambique

Pluriannual  Programme  :  easy  currency,
supporting actions, technical assistance.

Zimbabwe

Supplying 90,000 tonnes of cereals, 1,300
tonnes of seeds

Pacific

Vanuatu

Supporting farmers’ organisations

287

Amount
(€ million)

32.5*

0.4

0.3*

5.5*

2.0*

3.1*

2.0

8.5

6.0*

2.0

5.1*

3.3*

15.1

4.9

29.9

4.9

7.9*

49.0*

16.0*

14.8*

35.0*

1.4

Several (RIP)

Implementing 
development

sustainable 

agricultural

6.2

Sub-total – EC budget (marked with * above)

Sub-total – EDF

Total

180.5

75.3

255.8

288

Private Sector Development

Region

Country

Project

Caribbean

Cuba

West Africa

Burkina Faso

Overseas  Countries  &
Territories

Saint  Pierre  &
Miquelon

Caribbean Region

All ACP Countries

Total

the

from 

public 

tourism 

business

financial

Improving 
management and accounting
Supporting 
opportunities
Promoting 
Basque countries
Caribbean 
Development Programme
Caribbean  Regional  Tourism
Development Programme
Centre  for  the  Development  of
Enterprise
ACP 
Business 
Scheme (extension)

Assistance

Regional 

Trade

Amount
(€ million)
3.4

6.0

0.1

1.5

8.0

19.2

0.7

38.9

289

European Initiative for Human Rights

Region

Country

Project

Amount

(€ million)

Côte d'Ivoire

Community-based projects

Monitoring elections

West
Africa

Sierra Leone

Supporting 
Commission

Truth 

& 

Reconciliation

Reporting Human Rights abuses

Rehabilitating victims of torture

Burundi

Protecting Human Rights, restoring peace

Reconciling divided communities

Central
Africa

Cameroon

Preventing torture

Central  African
Republic

Combating racism

Rwanda

Angola

Congo

Combating racism

Funding legal trials at Gaçaça

Maintaining peace settlement

Monitoring elections

Protecting Human Rights

Congo (DRC)

Strengthening the judicial system

Eastern  &
Southern
Africa,
Indian
Ocean

Ethiopia

Kenya

Combating racism

Strengthening parliamentary institutions

Community-based projects

Preventing torture

Monitoring elections

Madagascar

Monitoring elections

Zimbabwe

Preventing torture

Promoting good governance

290

0.3

1.6

1.0

0.7

1.0

0.6

0.7

0.3

0.9

0.3

0.3

0.6

1.0

0.9

1.0

0.5

0.7

0.4

0.4

1.8

1.0

0.7

0.3

Caribbean

Fiji

Haiti

Cuba

Dominican
Republic

Promoting good governance

Supporting Human Rights Commission

Strengthening civil society

Developing democracy

Combating racism

Jamaica

Ensuring free and fair elections

Caribbean

Abolition of the death penalty

Botswana,
Cameroon,
Ghana,  Kenya,
Lesotho,  Malawi,
Nigeria,
Swaziland,
Tanzania,
Uganda,  Zambia,
Zimbabwe

Senegal,  Mali,
Burkina-Faso,
Gambia,  Ghana,
Togo,
Nigeria, 
d'Ivoire,
Côte 
Sierra 
Leone,
Benin

Regional

Total

Abolition of the death penalty

Preventing torture

0.6

0.5

0.7

0.5

0.7

0.2

1.1

0.4

1.2

22.9

291

Macroeconomic Support: Structural Adjustment Programmes

Region

Country

Budgetary Support Programme

Amount

(€ million)

Caribbean

Jamaica

Poverty reduction

Mali

Niger

Poverty reduction

EIB debt arrears & poverty reduction

West Africa

Côte d’Ivoire

Internal public debt arrears

Burkina Faso

Poverty reduction

Central  African
Republic
Democratic
Republic 
Congo
Madagascar

of

Burundi

EIB debt arrears

Emergency 
programme: 
Development Bank debt arrears

African

Emergency  programme:  debt  arrears;  roads;
drugs provision; elections; health & education
EIB debt arrears & poverty reduction

Ethiopia

Poverty reduction

Mozambique

Poverty reduction

Central
Africa

&

Eastern 
Southern
Africa 
&
Indian Ocean

Total

30.0

25.7

20.0

40.0

125.0

4.4

5.5

70.0

22.6

44.0

168.0

555.2

292

Health (including HIV/AIDS)

Region

Country

Project

Reducing illicit drug demand
Making blood transfusions safe
Funding reproductive healthcare
Complementary support to the health
sector
Complementary support to the health
sector
Complementary support to the health
sector
Raising HIV/AIDS awareness
AIDS vaccine initiative
Complementary support to the health
sector
UNFPA/IPPF

Youth HIV/AIDS

Maternal health
Barcelona Conference participation
Ending female genital mutilation
IMMPACT
Combating AIDS, TB & malaria

Caribbean

West Africa

Central Africa

Suriname
Niger
Nigeria

Cameroon

African

Central 
Republic
Congo (DRC)

&

Eastern 
Southern
Africa,  Indian
Ocean

South Africa

Zambia

Regional

*Sub-total (EC budget)

Sub-total (EDF)

Total

Amount

(€ million)
0.75
2

0.5

2.2

9

10
1.4*
0.7

32
22.9*

5.0*
0.5*
1.4*
1.1*
60

32.3

117.15

149.45

293

Education (including culture)

Region

Country

Project

Amount

(€ million)

Caribbean

Pacific

Central Africa

West Africa

Dominican
Republic
Fiji

Papua 
Guinea
Vanuatu

Gabon

New

Feasibility  and  programming  study
for the 9th EDF
New  building  of  Laukota  teachers’
college
Improvement  of 
education facilities
Training  of  Vanuatu  air 
controllers
Cultural activities

rural  primary

traffic

São  Tomé  &
Principe

Cultural activities

Burkina Faso

Supporting decentralisation

Pan-African Cinema Festival

Côte d’Ivoire

Training to combat prostitution

Angola

Botswana

Comoros

Ethiopia

Tanzania

Zimbabwe

Netherlands
Antilles
West Africa

Eastern  and  Southern
Africa 
Indian
and 
Ocean

Overseas Countries &
Territories
Regional
Programmes

Funding  for  the  film  “Comboio  da
canhoca”
Funding  for  the  film  “Na  cidade
vazia”
Supporting Ministry of Finance

Upgrading  of  Gaborone  technical
college
Strengthening civil society

Capacity-building in education

Establishing law faculty at Mekelle
University
Primary  education  development
plan
Implementation 
employment studies

terms 

of 

of

Youth development

Study  of  theatre  festivals  in  sub-
Saharan Africa

the  “Sand  School”

Supporting 
(Dakar)
Mobile numerical cinema

West Africa

294

0.2

4.2

5.0

0.3

0.4

0.2

1.9

0.3

0.1

0.4

0.1

2.0

3.9

0.1

0.7

2.0

25.0

0.1

4.5

0.1

0.0

0.7

0.3

in  numerical  &  radio

Training 
recycling
Post masa 2001

All countries

Fespaco 2003 film festival

Functioning of regional operational
centre. junior achievement
Participation  in  the  8th  Ceramics
Biennale
Funding  for  the  film  “Zulu  Love
Letter”
Preliminary  work  on 
reform

regional

Total

0.6

0.3

0.4

0.4

0.2

0.2

2.0

56.6

295

Environment (including tropical forests and water management)

Region

Country

Project

Amount

(€ million)

Caribbean

Dominican Republic

Solid waste programme

West Africa

Burkina Faso

Improving rural water distribution

Central
Africa

Cameroon

Gabon

Kenya

Managing protected forest areas through
government,  NGO  &  civil  society
partnerships

Using new wildlife management method

Sustainable forest management

Eastern  &
Southern
Africa,
Indian Ocean

Pacific
Overseas
countries  &
territories

Regional

Kenya, Somalia

Managing natural resources in semi-arid
regions

Lesotho

Six towns water supply

Malawi (NIP)

Social forestry project

Mozambique

Beira sanitation

Mozambique

Namibia

Rwanda

South Africa

Tanzania

Samoa
St. 
Miquelon

Pierre 

Community-based 
management and carbon management

natural 

resource

Karasburg Sanitation
Bugesera 
supply
Water sector support programme

/  Karenge  drinking  water

Sustainable forest management

Infrastructure technical assistance
St. Pierre sanitation

&

Caribbean, Pacific

Community–based 
management & coral reef restoration

fisheries

Pacific

Sustainable management of biodiversity

West Africa

Maintenance 
biodiversity

of 

tropical 

forest

Forest law enforcement and governance

West  Africa,  Central
Africa,  Eastern  &
Southern 
Africa,
Indian Ocean

Africa,
Central 
Eastern  &  Southern
Africa, Indian Ocean

Technological 
sustainable 
Cybertracker

development 

for
resource  management:

296

4.0

10.0

1.2*

1.7*

1.9*

1.3*

2.0

0.9

1.9

1.6*

1.5
19.3

7.3

1.8*

0.4
1.2

0.5*

1.3*

0.4*

0.5*

1.6*

Reducing  rural  poverty  reduction  &
managing  forests  sustainably  through
development  of  non-timber  products  &
community institutions

Education  –  Environmental  Capacity
Development Programme

Ethiopia

Ghana, 
South 
Mozambique 
Angola

Namibia,
Africa,
and

*Sub-total (EC budget)

Sub-total (EDF)

Total

1.2*

0.9*

15.9

48.5

64.4

297

Partnership with NGOs

Region

Country

Amount

(€ million)

West Africa

Benin

Burkina Faso

Cape Verde

Côte d'Ivoire

Guinea

Guinea Bissau

Liberia

Mali

Mauritania

Niger

Nigeria

Senegal

Sierra Leone

The Gambia

Togo

Cameroon

Central Africa

Central African Republic

Chad

Sao Tomé & Principe

Eastern  and  Southern  Africa,
Indian Ocean

Angola

Burundi

Congo (DRC)

Eritrea

Ethiopia

Kenya

298

2.2

1.3

0.5

0.6

2.2

2.1

0.8

1.8

0.6

0.8

0.3

1.4

0.7

0.3

0.6

0.7

0.4

5.3

0.7

6.9

2.1

1.0

0.7

1.8

2.1

2.1

1.5

2.9

0.5

1.5

4.4

0.6

2.9

5.0

2.0

1.3

1.0

1.6

1.5

4.3

0.7

0.4

0.6

1.5

0.8

75

Madagascar

Malawi

Mozambique

Namibia

Rwanda

Somalia

South Africa

Sudan

Tanzania

Uganda

Zambia

Zimbabwe

Cuba

Caribbean

Dominican Republic

Haiti

Angola, Congo, Gabon

Ethiopia, Kenya, Sudan, Tanzania, Uganda

Regional

Pacific (All countries)

West Africa (Burkina Faso, Ghana)

West Africa (Benin/Togo)

Total

299

Linking Relief, Rehabilitation and Development

Region

Country

Project

Amount

(€ million)

Caribbean

West Africa

Central Africa

Eastern  &  Southern
Africa, Indian Ocean

Dominican
Republic
Guinea-Bissau

Togo

Micro-projects

Reintegration  ex-combatants  rural
areas
Micro-projects

Central  African
Republic
Angola

Micro-projects

Micro-projects

Supporting displaced people

Burundi

Congo

Congo (DRC)

Djibouti

Eritrea

Programme  of  emergency  and
support to the peace process
Complementary 
rehabilitation programme
Micro-projects

support 

to

Improving healthcare provision

communities

demobilisation 

Reconstruction  at  Goma,  medical
assistance
Helping  displaced 
return home
Emergency 
reintegration support
Supporting  refugees  &  internally
displaced people
Supporting voluntary repatriation &
reintegration
Clearing mines

and

Ethiopia

Reintegrating  Ethiopians  displaced
from Eritrea
Landmine impact survey

Malawi

Micro-projects

Mozambique

Namibia

Rwanda

Somalia

technical 

Landmine 
Inhambane & Maputo provinces
Reintegrating ex-combatants

survey,

Micro-projects

Rehabilitation programme

action 

Mine 
landmine impact survey in N.E.

capacity-building,

300

7.0

3.0

14.6

4.2

7.4

16.3

30.0

9.6

5.5

2.0

10.0

2.0

7.0

2.2

6.8

0.7

6.7

1.0*

38.0

1.0*

1.2

3.2

50.0

1.5*

Sudan

Land mine expert

Mine ban education in South

Tanzania

Training refugees to be self-reliance

Micro-projects

Zimbabwe

Micro-projects

All countries

Great Lakes

Demobilisation & reintegration

Eritrea

Demobilisation & reintegration

Total

8.5.

COMMITMENTS 2002 ASIA

Conflict Prevention, Good Governance and the Rule of Law

0.2

0.1*

4.0

2.0

3.8

20.0

20.0

281

Country

Project Title

Indonesia

Office of Attorney-General

Afghanistan

Rapid Reaction Mechanism (RRM)

Indonesia

Rapid Reaction Mechanism (RRM)

Nepal

Rapid Reaction Mechanism (RRM)

Sri Lanka

Rapid Reaction Mechanism (RRM)

Cambodia

Rapid Reaction Mechanism (RRM)

Total

Amount

(€)

775.000

5.900.000

2.774.000

615.000

1.800.000

3.000.000

14.864.000

Asia projects under Regional/Integration (B7-3000/3010)

Country

Project Title

Asia-Urbs (increase)

ASEAN-IPR (increase)

Asia-Europe Foundation phase II (ASEF)

Asia Invest II

IT&C (increase)

Framework contract/studies

Asia

Asia

Asia

Asia

Asia

Asia

Total

Amount
(€)

3.000.000

2.500.000

3.500.000

35.000.000

5.000.000

3.600.000

52.600.000

301

Transport and Infrastructure

Country

Project Title

Nepal

Renewable Energy

Amount

(€)

15.000.000

302

Food Security and Development

Country

Project Title

Bhutan

Medicinal Plants

Bangladesh

Rural towns development

Total

Institution Building

Country

Project Title

ASEAN

APRIS (instl’ strengthening)

Vietnam

SME Development Fund

Bangladesh

SEDF-Enterprise development

Cambodia

Multilateral trade assistance

China

WTO II (support to China's integration…)

Indonesia

Small Project Facility

Laos

Multilateral trade assistance

Philippines

Small project facility

Amount

(€)

4.200.000

10.000.000

14.200.000

Amount

(€)

4.000.000

995.000

10.000.000

2.080.000

15.000.000

6.180.000

1.080.000

3.000.000

Vietnam

Vietnamese  Government 
Programme

Interpreters  Training

850.000

Vietnam

European T.A. Programme for Vietnam (ETV2)

Total

Macroeconomic Policies

Country

Project Title

Pakistan

Support to government reform/Fin. Sector

Vietnam

Labour Market Facility

Total

11.034.800

54.219.800

Amount

(€)

50.000.000

10.000.000

60.000.000

303

Country

Project Title

Health

Indonesia

Support to Community Health Services

Thailand

Health Care Reform

Burma

HIV/Aids project (within UN joint Plan of Action)

Asia

Reproductive Health/UNFPA - II

Pakistan

Drugs- Reach Out II

Total

Country

Project Title

Education

Vietnam

Assistance for street children

Pakistan

Northern Pakistan Education Programme

Laos

Support for Basic Education

Bangladesh

SMILING (support to NGOs)

Cambodia

Support to the Education Sector

European studies

China

Total

Amount

(€)

35.000.000

5.000.000

5.000.000

18.540.000

993.360

64.533.360

Amount

(€)

990.000

20.000.000

6.000.000

8.000.000

20.000.000

10.328.100

65.318.100

Environment (incl. Tropical Forests, Water management)

Country

Project Title

Amount

(€)

Indonesia

Participation  Management  of  National  Resources  in
Berau

17.000.000

304

Linking Relief, Rehabilitation and Development

Country

Project Title

Afghanistan

Rehabilitation/ Reconstruction

Afghanistan

Second Recovery Programme

Total

8.6.

COMMITMENTS 2002 LATIN AMERICA

Bonne gouvernance et Etat de droit

Pays

Projets

Pérou

Guatemala

Venezuela

Total

Commission de la vérité et de la
réconciliation 

Renforcement de la société civile

Renforcement de la démocratie

Amount

(€)

57.500.000

70.000.000

127.500.000

Montants en €

904.000

12.000.000

600.000

13.504.000

Initiative Européenne pour la Démocratie et les Droits de l’Homme

Pays

Projets

Montants en €

Colombie

Colombie

Colombie

Mexique

Bolivie

Colombie

Renforcement du système judiciaire

Renforcement de la capacité du Médiateur

Protection des défenseurs des Droits de l’Homme

Renforcement de la capacité institutionnelle des
organismes publics des Droits de l’Homme

Promotion des Droits de l’Homme des peuples
indigènes du Chaco

Renforcement de la capacité des peuples indigènes
d'Antioquia à exercer leurs droits

Guatemala

Droits de l’Homme et participation sociale Maya

Equateur, Pérou

Réunification, revalorisation culturelle et continuité
du peuple Secoya

Nicaragua

Guatemala

Colombie

Paraguay

Promotion et défense des droits des peuples indigènes
et des descendants d'origine africaine

Lutte contre la discrimination ethnique

Renforcement des processus d'organisation de 120
communautés afro-colombiennes

Lutte contre la discrimination à l'encontre des
minorités ethniques et de la population indigène

Argentine

Réhabilitation des victimes de la torture

Chili

Pérou

Réhabilitation des victimes de la torture

Réhabilitation des victimes de la torture

600.000

650.000

599.525

640.000

347.408

694.448

600.000

401.565

983.188

1.218.414

643.790

353.861

645.674

200.000

819.734

305

Pérou

Equateur

Equateur

Colombie

Prévention de la torture

Mission d'observation électorale de l'UE

Création d'un code d'éthique et d'éducation
démocratique

Accroissement de l'engagement public dans le
processus électoral

Région andine

Prévention des conflits

Colombie

Guatemala

Mexique

Total

Micro-projets

Micro-projets

Micro-projets

Appui institutionnel

671.343

1.215.800

119.350

349.858

939.400

500.000

300.000

500.000

13.993.358

Pays/région

Titre du projet

Montants en €

Honduras

Mexique

Bolivie

Amérique latine

Total

Appui à la réforme et à la modernisation de
l’administration publique

Appui et modernisation de l’administration
de la justice

Appui  au  développement  du  commerce  et
promotion des investissements

Appui 
PME 
financièrement faibles en Amérique latine

institutions

aux 

et 

4.000.000

3.500.000

6.300.000

200.000

14.000.000

306

Coopération régionale

Région

Projet

Montant s en €

Régional Amérique
Latine

Programme de bourses de haut niveau ALBAN
Programme AL-Invest – appui aux
investissements

ALFA II – Coopération académique

Statistiques Communauté andine

Communauté
andine

Total

45.000.000

46.000.000

17.000.000

5.000.000

113.000.000

Transports et Infrastructures

Pays / Région

Titre du projet

Montants en €

Venezuela

Programme de prévention des inondations dans
les Etats de Falcón, Yaracuy et Miranda

10.000.000

Développement rural

Pays / Région

Titre du projet

Montants en €

Nicaragua

Bolivie

Panama

Développement rural local dans le département
de Rivas

10.500.000

Appui  à 
(APEMIN)

la  petite  exploitation  minière

7.000.000

Appui  aux  petits  producteurs  ruraux  de  la
région centrale du Panama

102.421

Honduras

Programme d’appui dans la zone d’Olancho

1.970.000

Total

19.572.421

307

Pays

Sécurité alimentaire

Aide directe en
millions d’euros
(période)

ONG en millions
d’euros (nombre
de projets 2002)

FAO en
millions
d’euros

Euronaid en
millions
d’euros
(nombre de
projets en
2002)

Pérou

79,5

Equateur

Bolivie

6,4

80

Nicaragua

33,5

Honduras

25

3,4

3,2

6,6

11,4

6,1

(1995 – 2004)

(2000 – 2004)

(1995 – 2005)

(1995 – 2004)

(1996 – 2004)

Guatemala

Pas aide directe

2, 4

El Salvador

Pas aide directe

Cuba

Total

2

226,4

(2003 – 2005)

3,2

0,5

36,8

(12)

(4)

(17)

(21)

(19)

(6)

(5)

(1)

1,5

0,7

1,3

0,1

(2)

(1)

(2)

3,5

0,1

(85 projets)

(5 projets)

308

Santé

Région

Titre du projet

Communauté andine

Lutte  contre  les  dépendances  -  contrôle
des précurseurs chimiques

Pays

El Salvador

Education

Titre du projet

Réforme 
technique (extension)

de 

l’éducation  moyenne

Politiques macro-économiques

Pas d’engagement en 2002

Pays

Brésil
Brésil

Nicaragua
Honduras
Guatemala

Amérique
centrale

Honduras

Nicaragua

Communauté
andine des
Nations
Panama,
Colombie,
Equateur

Equateur

Chili

Argentine

Total

Environnement

Projet

Corridors écologiques
Développement durable du corridor écologique de
Cuiaba-Santarem en Amazonie centrale: concilier
croissance économique et protection de la forêt à
grande échelle
Economie forestière pour les démunis: certification,
développement du marché et établissement d’un
environnement économique et politique favorable à
la gestion forestière durable en Amérique centrale
Intégration des secteurs civils à la co-administration
d’aires protégées (Comanejo) et gestion de conflits
environnementaux en Amérique centrale
Renforcement de la gestion locale des ressources
naturelles dans les bassins versants du Patuca et du
Choluteca
Renforcement des politiques
environnementales
Programme de renforcement des systèmes de
protection civile

Conservation et développement durable dans la
région bio-géographique de Chocó: établir les
capacités d’amélioration des revenus et durabilité
environnementale
Développement participatif d’un modèle
transposable de développement basé sur le bambou
dans les pays andins
Rio H – Agenda civil, contre la pauvreté et la
désertification. Protection environnementale
Préservation et gestion des ressources naturelles de
la région interfluviale Teuc-Bermejito dans le cadre
du plan de développement durable régional du
Chaco

309

Montants en €

1.600.000

Montants en €

2.800.000

Montants
en (€)

7.000.000
1.497.295

2.221.846

862.032

20.000.000

1.600.000

9.450.000

2.115.120

1.000.000

845.071

1.175.021

47.766.385

Partenariat avec les ONG

Pays

Nombre de
projets

Montants en €

Amérique Centrale

Argentine

Bolivie

Brésil

Colombia

Ecuador

Guatemala

Honduras

Mexique

Nicaragua

Panama

Pérou

Paraguay

Uruguay

Venezuela

El Salvador

Total

1

4

5

5

4

4

3

3

3

4

1

4

2

1

2

3

49

978.577

2.129.144

6.251.190

3.349.377

3.491.131

2.802.823

2.082.200

3.749.464

1.581.816

2.269.258

313.750

3.695.523

1.427.260

746.227

856.506

2.818.851

38.543.097

Liens entre aide humanitaire, réhabilitation et développement

Pays

Honduras

Titre du projet

Quatrième engagement budgétaire pour le
PRRAC

Montants en €

36.330.000

Nicaragua, Honduras Quatrième engagement budgétaire pour le

30.880.000

PRRAC

Total

67.210.000

Réhabilitation/Mines anti-personnel

Pays

Titre du projet

Montants en €

Nicaragua

Opérations  humanitaires de  déminage  sur
la 
et
frontière  Nicaragua/Honduras 
opérations du plan d’action spécial mines

1.300.000

Réfugiés/Population

Pays

El Salvador

Colombie

Total

Titre du projet

Montants en €

Prévention  de 
délinquance juvénile

la  violence  et  de 

la

9.200.000

Programme  en  faveur  des  populations
déplacées

1.500.000

10.700.000

310

9.

9.1

ANNEXES

HARMONISATION OF CONTRACT AND FINANCIAL PROCEDURES

9.1.1

Financial regulations

The EuropeAid Cooperation Office has been heavily involved in the consultations on
the  new  Financial  Regulation  applicable  to  the  general  budget  and  on  the
implementing  rules;  the  specific  provisions  governing  external  actions  which  make
for  their  smooth  implementation,  in  particular  the  Manual  of  Instructions  of
10.11.1999, have been preserved.

EuropeAid  has  started  preparing  for  the  entry  into  force  of  the  new  Financial
Regulation by, inter alia, revising the Manual of Instructions and its Practical Guide
to  EC  external  aid  contract  procedures  and  devising  standard  models  for  financing
proposals/agreements.  This  has  been  hindered,  though,  by  the  fact  that  the
implementing rules were only finalised at the very end of the year.

the  newly  adopted  regulatory  framework  and 

the  subsequent
In  view  of 
establishment  of  updated  guidelines  on  the  segregation  of  duties  and  adaptation  of
the  Accounting  System  SINCOM2  at  the  central  level  of  the  Commission,
EuropeAid has promptly updated its financial circuits for actions financed  from the
general  budget.  The  update  of  the  financial  circuits  has  namely  involved  the  clear
identification  of  the  initiating  and  verifying  agents  on  the  one  hand  for  the
operational  aspects  and  on  the  other  hand  for  the  financial  aspects  and  the
introduction of an additional ex-ante control (on a temporary basis).

EuropeAid has also been heavily involved in the drafting of the Financial Regulation
applicable to the 9th EDF. The proposal adopted by the Commission, which is very
close to the new Financial Regulation applicable to  the general  budget,  is currently
being discussed within the Council by the Member States.

9.1.2

General Regulations for contracts financed by the EDF

The  Commission  has  had  the  General  Regulations  and  the  General  Conditions  for
contracts,  and  the  procedural  rules  on  conciliation  and  arbitration  applicable  to
contracts financed under the Cotonou Agreement adopted by the ACP-EC Council of
Ministers.  With  the  new  General  Regulations,  the  contractual  procedures  under  the
9th EDF will be largely similar to those of the other programmes of EC external aid
since the adoption of the Manual of Instructions of 10.11.1999.

9.1.3

International organisations

The Commission has negotiated with the UN Secretariat to revise the 1999 EC-UN
framework agreement and adapt it to the stronger partnership both institutions want
to build. A draft Financial and Administrative Framework Agreement was agreed by
the negotiators in early November and is now subject to internal approval procedures
on both sides. Once adopted, it will allow the Commission, in its relations with the
UN, to make full use of the possibilities offered by the new Financial Regulation for
cooperation with international organisations.

311

EuropeAid has supervised the implementation of the 8 November 2001 Trust  Fund
and Cofinancing Framework Agreement with the World Bank, and negotiated a first
amendment  to  adapt  it  to  the  new  Financial  Regulation.  This  is  going  through  the
internal approval procedures.

EuropeAid  has  taken  a  leading  role  in  discussions  with  the  WFP,  which  were
successfully concluded by a decision of the WFP Executive Board on 22 October to
decrease the level of administrative costs charged to donors by this organisation from
7.8% to 7%.

9.1.4 Miscellaneous

The  network of  contract/finance  units meets monthly to discuss  subjects  of  general
interest and coordinate positions among the various directorates.

EuropeAid has implemented verifications and training missions and provided further
guidance  notes  and  tools  (examples  being  a  memo  on  harmonisation  of  the  system
for  archiving  financial  and  contractual  supporting  documents,  web  pages  on  the
financial  and  contractual  procedures,  and  visibility  guidelines  for  contractors  and
implementing partners).

EuropeAid  has  put  in  place  a  training  scheme  on  contractual  procedures,  including
advanced  training,  based  on  practical  cases,  and  has  carried  out  various  training
sessions at headquarters and in devolved delegations (South Africa, Bosnia, Croatia,
Burkina Faso, etc.). It also provided training on financial circuits at headquarters in
Brussels.  These  training  sessions  were  also  open  to  colleagues  working  in  some
devolved delegations.

Figures for the website of EuropeAid Cooperation Office in 2002

– 

5724 tenders and grants documents were published (of which 1395 were calls
for tenders and proposals).

– 

There were more than 4 million hits per month.

–  More than 1 million html pages were downloaded each month.

9.2

RAL

“RAL”  refers  to  the  amount  of  committed  money  that  has  not  yet  been  paid.  The
term comes from the French reste à liquider or rest to be paid. It is the sum of total
amounts committed in the past budgetary years, minus the total amounts disbursed or
decommitted.

312

9.2.1

External assistance financed by the EU budget

9.2.1.1 Old budget commitments

- Prior to 1995

Progress since the initial inventory (November 1999)

In the case of EuropeAid-managed budget lines of heading 4 (external aid), the RAL
has decreased 80% in financial volume, from €1 092 million to €223.9 million. This
reduction  has  been  achieved  both  by  payments  (€382  million)  and  decommitments
(€486 million).

A  total  of  1432  pre-1995  budget  commitments  have  been  closed  in  the  accounting
system,  their  remaining  balances  having  been  fully  paid  and/or  decommitted.  This
accounts for 87% of the initial stock of 1 646 budget commitments163 to be reviewed
for budget lines in EuropeAid’s portfolio.

Taking  into  consideration  the  commitments  already  decommitted  (1432),  plus  the
open  commitments  reviewed  or  under  review  (214),  action  has  been  taken  on  all
the initial stock of old commitments to be reviewed.

Progress in 2002

Since  the  beginning  of  2002  the  RAL  for  pre-1995  budget  commitments  fell  from
€429.7 million to €223.9 million (-48%). By way of reference, the overall objective
for end 2002 was €232.8 million.

There are now 214 open commitments compared with 532 at the beginning of 2002,
a 60% decrease over the year.

Of  the  budget  commitments  still  open,  48  out  of  the  214  still  outstanding  (22%)
are reported as ongoing and have valid final due dates in accounting system. These
account for €143.7 million, 64% of the pre-1995 RAL in financial volume.

The end-of-year report for 2001 identified in the stock left open and carried over to
2002  a  total  of  354  budget  commitments  ‘to  be  closed’.  Excluding  line  B7-6100
(transferred  to  DG  Development),  there  were  338  budget  commitments  in  the
EuropeAid  portfolio  to  be  closed.  A  total  of  318  budget  commitments  were
cancelled in 2002, 94% of the stock identified for closure.

163

Initial reference figure; all commitments from budget line B7-610, transferred to DG DEV, now totally
excluded although they were part of EuropeAid’s review and closure activity between November 1999
and September 2002, and thus counted as such in previous reports.

313

                                                
RAL situation from 1994 to 2002 by payment year

The Balkans

Tacis

Latin amer.

Asia

Me diter.

South Afr.

Food aid

DHR

O thers

Budget

EDF

Total

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

5,98

4,36

8,21

8,12

3,41

3,04

1,49

1,00

1,40

4,11

3,68

4,11

4,01

3,66

2,78

3,01

3,55

3,80

4,85

5,57

6,02

6,81

7,68

6,49

5,79

8,28

7,82

8,55

7,26

6,17

6,88

7,99

7,34

7,18

6,18

5,18

3,06

4,32

4,09

4,81

5,75

7,87

6,69

6,37

4,36

1,95

4,24

10,19

5,87

5,63

4,20

3,95

4,61

3,76

1,62

1,65

2,02

2,23

3,24

3,09

2,57

2,06

2,49

1,78

1,70

1,81

1,88

2,08

3,85

4,09

4,52

2,54

2,02

2,12

2,12

2,18

2,81

2,92

3,80

3,65

2,65

2,42

2,70

2,81

3,26

3,11

3,31

3,50

3,75

4,06

4,55

4,40

3,85

3,58

3,43

3,68

3,45

3,68

2,28

3,32

2,95

3,10

3,38

3,26

3,37

5,01

5,48

3,99

4,41

3,13

3,11

3,25

2,66

3,21

3,12

3,31

3,59

3,75

4,06

4,61

4,43

3,74

3,78

The  RAL  is  the  difference  between  the  cumulative  amounts  committed  (less  the
decommitments)  and  the  cumulative  amounts  paid:  the  RAL  measures  the  outstanding
unpaid commitments.

Measuring the outstanding commitments (RAL) against the amounts paid each year enables
us  to  determine  the  estimated  period  for  remaining  disbursements.  The  overall  evolution
masks significant disparities between the main aid programmes.

The  RAL  situation  for  the  major  programmes  appears  to  be  under  control,  except  for  the
Latin  American  programme,  which  has  to  reduce  the  time  taken  to  disburse  its  RAL  in
coming years. Most programmes have either a positive trend (Asia and the Mediterranean)
or  are  lower  than  average.  The  Tacis  programme  has  a  negative  trend,  even  if  its  RAL
disbursement period is still lower than average.

1995

Progress since specific review started

In  2001  commitments  from  1995  were  added  to  the  systematic  review  exercise  for
old commitments. There was €656.7 million outstanding at the beginning of 2001 for
504  open  budget  commitments,  counting  only  lines  presently  in  EuropeAid’s
portfolio.

The RAL in financial volume fell by 52.2%, to €313.65 million by the end of 2002;
this 
(€202.233  million)  and
decommitments (€140.88 million).

reduction  was  achieved  by  both  payments 

The  decrease  in  the  number  of  budget  commitments  with  outstanding  balances  is
more significant, from 504 to 152 (70% of commitments closed).

Taking  account  of  the  commitments  already  decommitted  (352),  plus  the  open
commitments  reviewed  or  under  review  (152),  action  has  been  taken  on  all  504
commitments of the initial stock from 1995 added to the review  exercise in 2001
(line B7-610 transferred and excluded from initial stock).

314

Progress in 2002

Since the beginning of 2002 the RAL fell from €455.89 million to €313.65 million
(-31%).  By  way  of  reference,  the  overall  objective  for  year’s  end  was  set  at
€312 million.

For  budget  commitments  still  open,  62  out  of  the  present  total  of  152  outstanding
(41%) are reported as ongoing and have valid final due dates in accounting system.
These  account  for  €277  million,  88%  of  the  RAL  from  the  1995  budget  year  in
financial volume.

The end-of-year report for 2001 identified in the stock left open and carried over to
2002 a total of 168 budget commitments ‘to be closed’. The number of closures in
2002 rose to 141, 84% of the stock from 1995 identified at the start of the year
for closure.

1996, reviewed in 2002

Budget commitments from year 1996 fell into the category ‘old’ when applying the
criteria  “open  for  more  than  five  budget  years”.  The  objective  of  systematic
reviewing and closing them wherever possible was set at the beginning of 2002: 485
budget  commitments  from  1996  for  a  sum  of  €656.25  million  thus  came  under
review. The outstanding amount (RAL) decreased by 40% to €390.1 million by the
end of the year, this reduction was achieved by both payments (€152.6 million) and
decommitments (€113.5 million).

The number of open commitments fell to 235: a total of 250 commitments, or 52%
of the stock to review, had been fully paid or decommitted.

Taking  into  account  the  commitments  already  decommitted  (250),  plus  the  open
commitments reviewed or under review (205), action has been taken on 455 of the
485 commitments, 94% of the initial number of budget commitments from 1996
added  to  the  review  exercise  in  2002.  The  30  budget  commitments  not  yet
examined  (or for  which  no  reporting  information  had  been  received  by  the  time  of
drafting)  came  under  several  lines:  ECIP  and  other  thematic  lines,  food  security
lines, NGOs, etc. However, these account for only 2% of the outstanding RAL.

(cid:1)  Global result for old commitments (pre-1997) and follow-up of Directorates’ RAL

reduction objectives for old commitments

Following  recommendation  from  EuropeAid’s  Board,  targets  for  reduction  of  old
RAL, broken down by Directorate, were adopted in 2002. It aimed to stabilise the old
RAL  in  financial  amounts  on  a  year-on-year  basis,  in  other  words,  cancel  the
automatic  increase  in  the  old  portfolio  created  by  adding  each  new  year  to  the
category ‘old’.

The level of old RAL, €885.53 million at the end of 2001 (pre-1995+1995), rose to
€1 541.78 million when the budget year 1996 was added, and the target was to bring
it down to €899 million by year’s end.

315

The  end-of-year  result  was  €927  million  for  old  RAL  pre-1997,  which  is  an
overall  reduction  of  €614  million,  96%  of  the  reduction  target.  This  reduction  in
was achieved both by payments (€329.4 million) and decommitments amounting to
€284.6 million.

For Directorate A (TACIS and CARDS programmes), the result has been negatively
affected  by  the  very  low  level  of  payments  in  the  1995  portfolio.  This  poor
performance  is  due  to  the  two  major  nuclear  safety  budget  commitments  in  this
portfolio  being  stalled  (these  two  budget  commitments164  account  for  85%  of  the
RAL from 1995). Any improvement in the old RAL situation for Directorate A relies
on  either  an  adequate  level  of  execution  and  payments  following  the  announced
contracting  or  decommitment  of  actions  that  cannot  be  executed  within  reasonable
time frames.

For  Directorate  D  the  final  result  was  also  hindered  by  a  relatively  low  level  of
payments  on  the  old  portfolio.  The  reason  can  be  sought  in  the  slow  disbursement
pace  and  very  long  average  lifespans  of  the  Asia  programmes.  Higher  levels  of
payments and/or decommitments will be necessary to improve results in 2003.

For  Directorate  E  (Latin  America  cooperation  budget  lines),  the  final  result  was
affected by a low level of decommitments (relative level lower than the level of the
other geographical Directorates).

(cid:1)  What comes next: 1997, to be reviewed

Budget  commitments  from  1997  now  fall  into  the  old  category  when  applying  the
criteria  “open for  more  than  five  budget  years”.  This  single  budget  year  had  at  the
end  of  2002  a  RAL  of  €890  million  for  395  outstanding  budgetary  commitments.
Note that the 1997 figure showed a  year-on-year decrease of 23% in 2002  from its
level of €1162.6 million at the beginning of the year, ahead of the systematic review
process to be undertaken in 2003. This was the result of current implementation.

Two remarks can be made about this budget year, which has been added to the ‘old’
stock for systematic examination.

(cid:1)  Its  financial  volume  (€890  million)  is  significantly  higher  than  that  of  the  old

RAL of 1996 in 2003 (€656 million);165

(cid:1)  The proportion of dormant RAL in this new stock for examination is fairly small
(€71.2 million, 8% of the total), though the proportion of in terms of commitments
is much higher (185 cases, 47% of total);

As  for  the  budget  chapters  and  portfolios,  B7-4  (Mediterranean)  accounts  for  over
43% of the amount outstanding from 1997 (€385 million). If one adds the Asia and
Latin  America  cooperation  lines,  the  proportion  of  these  three  portfolios  to  be
reviewed  in  the  new  year  is  77%  of  the  total  value,  higher  than  the  previous  year
(when they accounted for 69% of the RAL from 1996 added to old stock for review).

164

165

Chernobyl 1995, RAL €28.66 million, and Nuclear Safety 1995, RAL €17 million.
The figure given at the end of the 2001 report was €686 million for 509 open budget commitments from
1996. These included all the MEDA lines, including Turkey. Excluding MEDA Turkey commitments,
the figures are €656.3 million RAL for 504 open budget commitments from 1996.

316

                                                
For  these  chapters,  the  outstanding  amounts  compared  with  initial  amounts
committed are higher than in the previous year. At the start of 2003 the ratios RAL to
initial commitment (for the portfolio from 1997) are 61% for the Mediterranean, 57%
for Asia, 55%  for Latin America, whereas the equivalent ratios at the start of  2002
(1996 added to the old stock) were 53% for Mediterranean, 46% for Asia and 48%
for Latin America.

A significant share of the present volume of RAL from 1997 that have been added to
‘old’ (€401  million of €890 million) is accounted  for by a small  number  of  budget
commitments (53) with a disbursement ratio of less than 20% of initial commitment,
meaning  that  these  are  commitments  with  a  very  slow  execution  rate  by  any
standards.  This  set  of  budget  commitments  warrants  special  attention,  either  in  the
form  of  anticipated  closure  or  partial  decommitment  if  initial  amounts  are  now
manifestly  over-estimated,  plus taking  into consideration  consistent  implementation
of  non-extension  stated  policy.  These  commitments,  specifically  those  with  the
highest RAL in absolute terms, have been targeted when preparing at year’s end the
specific review to be launched in 2003 of under-performing commitments.

(cid:1)  Overall RAL trends for old commitments

The  table  below  shows  the  trends  in  old  RAL  over  the  period  1999-2002.  As
evidenced in the table, results achieved in reducing the old RAL portfolio, though not
entirely  cancelling  the  increases  created  by  adding  successive  budget  years,  have
been steadily improving year on year, both in absolute terms, that is a decrease in the
RAL, and in percentage terms.

OLD
RAL (€
million)

Nov 99 (1st
inventory)

01/01/2000 end 2000 01/01/2001 end 2001 01/01/2002 end 2002 01/01/2003

Pre-95

1 092.08

1 020.75

740.94

741.23

429.65

429.70

223.91

223.91

B95

B96

B97

656.76

455.98

455.89

313.65

313.65

656.32

390.14

390.14

889.84

TOTAL

1 020.75

740.94

1 397.99

885.68

1 541.91

927.70

1 817.54

decrease year-on-
year

-279.81

-512.1

-614.21

-27%

-37%

-40%

9.2.1.2 Dormant commitments

At year’s end there were 743 dormant budget commitments in EuropeAid’s portfolio,
an outstanding amount of €788 million. Total RAL from dormant commitments have
fallen by 40% year-on-year, which is a significant improvement of this indicator.

The table below shows trends over the period 1999-2002: after a slight deterioration
at the end of 2000, the reversal of this trend achieved last year is now confirmed and
speeding up (32% reduction compared to 15% reduction last year).

317

DORMANT

end 1999

end 2000

end 2001

End 2002

Number of commitments

2223

1900 (*)

1458 (*)

not old

1180

1055

715 (*)

TOTAL RAL (€ m)

1 537

1 493 (*)

1 160 (*)

not old

1 314

1 350 (*)

898 (*)

743

360

788

634

‘not old’

95/96/97

96/97/98

97/98/99

98/99/2000

(*) figures in 2001 table were €1 558 million end 2000 and €1 319 million end 2001,
as  they  included  the  total  MEDA  line  (Turkey  included).  The  figures  were
recalculated  excluding  Turkey  commitments,  which  were  in  fact  already  out  of
EuropeAid’s management portfolio.

NB: The year-end figures were established on the basis of comparison with the RAL
two years earlier, rather than the strict 24 months without payments criteria. Budget
commitments  for  which  partial  decommitments  have  been  made  are  thus  not
considered  dormant.  Figures  for  end  2002  were  established  following  the  same
method, for consistency of comparison.

Dormant  commitments  that  are  not  old  (from  1998  to  2000,  1997  already  being
excluded and considered old166) stand at €634 million, 80% of the dormant total.
This proportion is broadly unchanged from previous year (78% end 2001). The most
recent budget  years 1999 and 2000  now  account  for  74%  of  total  dormant  RAL  in
financial volume.

is  observed:  dormant  commitments 

An  analysis  of  disbursements  (payments  already  made  or  zero  disbursement),  a
modification 
(RAL)  which  with  no
disbursements  at  all  (“zero  payments  commitments”)  showed  a  significant  net
decrease in absolute terms, from €1 061 million end 2001 (Turkey included) to €531
million end 2002, and in percentage terms from 80% to 67%.

This  trend  is  considered  a  real  improvement.  As  pointed  out  in  the  2001  report,
dormant budget commitments  in start-up phase were  considered  as  symptomatic  of
structural delays within the project cycle and their level last year was considered too
high.  The  current  trend  should  continue  and  led  to  negligible  amounts  of  dormant
commitments with no disbursement. Any start-up  delays of  two  years  or  more  will
have  serious  consequences  for  the  availability  of  funds  for  the  project  in  question
(new  Financial  Regulation,  decommitment  of  amounts  not  contracted  within  three
years of budget commitment).

A breakdown of dormant  commitments by budget lines/chapters show that  the  four
top programmes for dormant amounts are the same as in 2001, and in the same order
(Mediterranean,  Latin  America  and  Asia  cooperation  lines,  plus  food  aid).  The
overall proportion of these four programmes has decreased, accounting now for 74%
of the total, against 90%.

166

Not counting 1997 as old yet the figure is €705 million (1997/98/99/2000).

318

                                                
Besides  the  overall  decrease  in  absolute  terms,  in  relative  terms  only  the
Mediterranean  can  be  singled  out,  as  its  share  fell  from  44%  to  39%  of  the  total
dormant. If the respective rehabilitation/refugees budget lines are  added to the Asia
and Latin America figures, Latin America’s share in total dormant amounts shows an
increase from 15% to 20% of the total, Asia’s share decreasing slightly (from 13% to
12%).

9.2.1.3 Efforts to close files and make decommitments

€502 million in EuropeAid’s management portfolio was decommitted in 2002. As in
previous  years  this  is  a  result  not  only  of  closure  of  old  files  but  also  the  overall
effort of reviewing the whole open portfolio. The part of old pre-1997 commitments
in total decommitments amounts to €285 million. The level of decommitments of old
RAL  in  2002  is  thus  similar  to  the  one  observed  in  2001  (€291  million),  though
higher in proportion (57% of total against 49% the previous year).

Decommitments in financial amounts can result from partial decommitments or from
closure of commitments whose remaining balances are fully decommitted.

In  terms  of  breakdown  by  budget  lines/chapters,  the  thematic  lines  managed  by
EuropeAid  Directorate  F  account  for  73%  of  the  total  number  of  commitments
closed.

9.2.1.4 Situation of potentially “abnormal” RAL (old or dormant)

Potentially  “abnormal”  RAL,  taken  as  an  indicator  for  surveillance  and  review  of
open budget commitments, have in the past two end-of-year reports been defined by
EuropeAid as comprising ‘old’ commitments (open for more than five budget years)
plus “dormant” commitments not yet counted in old.

The ratios calculated for the past two end-of-year reports were based on the portfolio
at the beginning of the new financial year, i.e.; they already integrated the next year’s
stock of old commitments in the total for ‘old’.

The total RAL, old or dormant, at the beginning of 2003 (thus including 1997) stands
at €2451.5 million (€1 817.5 million old RAL, plus €634 million dormant, not old),
which  is  a  small  year-on-year  increase  of  €11.6  million,  +0.5%,  on  2002
(€2 439.92  million).  This  is  due  to  adding  1997,  which  brought  with  it  a  greater
amount of old RAL than did adding 1996 in 2002; this offset the decrease in dormant
amounts.

The percentage of “abnormal” RAL (old + dormant not included in ‘old’) was 21%
at the beginning of 2001 (with 1996 already included in ‘old’167), down from 23% at
the  end  of  2000.  For  2003  this  ratio  remains  unchanged  at  21%  of  the  portfolio  at
year’s  start,  as  both  actors  in  the  calculation,  the  total  RAL  and  the  total  old  or
dormant, showed a very slight increase of roughly the same amount.

167

Excluding from MEDA line B7-410 the Turkey MEDA portfolio not managed by EuropeAid.

319

                                                
Trends in dormant commitments 2001-2002

SITUATION END 2002 (EuropeAid portfolio)

SITUATION END 2001 (EuropeAid portfolio)

SITUATION END 2000 (EuropeAid portfolio)

TOTAL DORMANT

of which, commitments with zero 
payments

TOTAL DORMANT

of which, commitments with zero 
payments

TOTAL DORMANT

of which, commitments with zero 
payments

Budget line B2002

Number of 
Commitments 

 RAL end 2002 (€)

Number of 
Commitments 

RAL  (€)

Number of 
Commitments 

 RAL end 2001 (€)

Number of 
Commitments 

RAL  (€)

Number of 
Commitments 

 RAL end 2000 (€)

Number of 
Commitments 

RAL  (€)

B7-20 Food Aid 

Asia Cooperation 
(B7300+B7301)

Asia 
refugees/rehabilitation

Latin Am. coop. 
(B7310+B7311)

Latin Am. 
refugees/rehabilitation

B7-32 South Africa

B7-4 Mediterranean (*)

B7-52 TACIS

B7-54 Balkans

B7-6 (NGOs & 
Thematical actions)

B7-7 Democracy & 
Human rights
Access to markets     (B7-
8500 + B7-8710 + 
B78720)

58

41

14

82.387.833,35

86.970.726,42

6.654.873,80

10

10

1

43.894.824,00

132

137.941.114,41

67.425.000,00

1.900.000,00

64

59

140.508.136,80

13.140.965,62

159

108.899.523,12

30

61.992.147,00

180

168.230.960,44

45.928.069,58

33.152.042,92

4

3

44.160.000,00

16.710.000,00

74

21

10.178.273,89

13.573.064,52

36

22

7

50

1

3

97.737.209,85

126.996.601,00

3.149.000,00

182

198

56

142.237.248,09

339.733.999,71

13.253.497,72

41

53

8

111.883.406,99

302.664.050,00

5.746.400,00

140.342.447,00

231

269.889.754,66

231

228.011.640,00

3.500.000,00

3.444.291,00

64

19

8.642.505,43

20.070.173,40

1

5

3.500.000,00

11.599.291,00

305.686.597,86

31

247.071.836,00

155

508.252.374,01

52

436.939.404,00

204

519.009.082,79

57

429.592.398,00

15.697.174,97

14.784.462,86

170

47.910.286,85

11.168.232,31

7

10

4

15

9.947.755,00

3.130.000,00

9

18

11.323.966,05

5.926.176,41

2.496.127,00

364

104.183.198,86

5.499.585,00

222

24.778.718,22

28.681.939,99

8

27.285.000,00

160

21.729.901,58

3

9

49

26

26

8.700.000,00

3.741.700,00

55.648.848,00

9.726.813,00

14.097.656,30

14

8

465

206

253

17.443.606,74

3.327.898,91

100.171.591,77

41.712.288,69

17.515.755,81

5

3

56

44

30

14.700.320,00

2.566.139,56

56.902.941,00

28.260.310,00

5.028.118,91

16

13

95

22

25

97

33

Grand Total

743

787.921.764,03

133

531.512.274,00

1458

1.159.766.850,81

284

904.023.970,15

1900

1.493.007.403,72

534

1.200.455.015,46

B65411

B8   PESC

2

6

86.762,02

8.217.760,74

0

0,00

figure total SCR end 2000

1908

1.501.225.164,46

534

1.200.455.015,46

Meda Turkey

Total Med

24

179

159.302.875,12

667.555.249,13

15

67

157.533.000,00

594.472.404,00

24

228

57.168.000,00

576.177.082,79

15

72

55.953.000,00

485.545.398,00

Total with Turkey 

1482

1.319.069.725,93

9.2.2

RAL external assistance financed by the EDF

The  analysis  includes  all  EDF  programmes  (EuropeAid:  NIPs/RIPs,  structural
adjustment, Sysmin; DG DEV: Stabex; DG ECHO: emergency aid168; EIB: interest-
rate subsidies, risk capital, loans).

9.2.2.1 RAL on old commitments

(cid:1)  Old RAL of pre-1995 commitments

For the EDF, the RAL in financial volume decreased by 60%, from €901 million
on 31 December 1999 to €363 million on 31 December 2002.

In 2002, the RAL for pre-1995 commitments fell from €497 million to €363 million
(-27%). By way of reference, the objective for year’s end was set at €375 million.

(cid:1)  Old RAL of 1995 commitments

Amounts  committed  in  1995  were  added  in  2001  to  the  old  RAL  (commitments
outstanding  after  five  years).  They  totalled  €375  million  at  the  end  of  2000.  Since
then,  the  RAL  in  financial  volume  decreased  by  51%  to  €183  million  at
31 December 2002.

Over the year this RAL decreased from €245 million to €183 million (-25%). By way
of reference, the objective for year’s end was set at €180 million.

168

ECHO  in  2002  reviewed  all  individual  cases  of  sleeping  commitments  under  its  responsibility  (EDF
and B7-210). As a result, for ECHO, the amount of sleeping commitments is down to less than 4 % of
the average annual budget.

320

                                                
(cid:1)  Old RAL of 1996 commitments

At the beginning of 2002 1996 commitments fell into the category ‘old’ in applying
the  criteria  “open  for  more  than  5  years”.  On  31  December  2001,  the  commitment
portfolio from 1996 totalled €319 million.  The outstanding  (RAL)  at 31 December
2002  decreased  by  34%  to  €210  million.  By  way  of  reference,  the  objective  for
year’s end was set at €240 million.

(cid:1)  Summary of the situation at year-ends

The year-on-year situation of the old RAL can be summarised as follows.

Situation at:

31/12/1999: €901 million pre– 995 commitments

31/12/2000: €996 million pre–1996 commitments

31/12/2001: €1061 million pre–1997 commitments

31/12/2002:

€756 million pre–1997 commitments

€194 million 1997 commitments

€950 million pre-1998 commitments

Forecast: (*)

31/12/2003:

€410 million pre–1997 commitments

€540 million pre–1998 commitments

(*) subject to adjustment in the course of the year.

At  the  end  of  2002,  all  open  pre-1998  commitments  became  ‘old’.  The
corresponding old RAL total €950 million. In other words, it looks like the tendency
of  “old  RAL”  to  increase  from  year  to  year  (€901  million  end  of  1999,  over  €996
million end of 2000, t€1 061 million end of 2001) has been reversed. Furthermore,
all objectives for year-end 2002 were met and in most cases exceeded.

9.2.2.2 Dormant commitments

(cid:1)  Evolution since 31 December 1999

In  the  case  of  the  EDF,  dormant  RAL  relate  to  financing  decisions  for  which  no
contracts have been concluded and no payments made over the last 24 months.

Situation at:

31/12/1999: €399 million (no movement for 18 months)

321

31/12/2000: €536 million (no movement for 18 months)

31/12/2001: €648 million (no movement for 18 months)

10/06/2002: €522 million (no movement for 24 months)169

19/09/2002: €485 million (no movement for 24 months)

31/12/2002: €449 million (no movement for 24 months)

9.2.2.3 Forecasts

The  EuropeAid  Board’s  objective  of  €400  million  for  31/12/2002  was  not  met.
However,  one  has  to  take  into  account  that  an  exceptionally  high  amount  was
committed in 2000 (€3757 million in total,  the highest  amount ever committed).  In
this  context,  the  performance  was  exceptional  in  that  there  was  a  reduction  rather
than  an  increase  in  2002,  from  €648  million  at  the  beginning  of  the  year  to
€449 million at year’s end.

9.2.2.4 Analysis of the dormant RAL

The  table  below  presents  an  overview  of  the  dormant  RAL  at  present,  split  up  by
EDF, by “dotation” and by project status (TRO: to remain open: €520 million; TBC:
to be closed: €39 million; Status Unknown: €30 million). It also explains the reasons
why the projects concerned are sleeping. Attention should be paid to the fact that we
are  talking  about  dormant  projects  without  movement  for  18  months,  since  this
definition  has  been  agreed  with  Parliament  and  the  Court  of  Auditors.  Since  this
definition is more stringent than the definition adopted by EuropeAid’s management
(no movement over the last 24 months), the amount in the year-accounts for dormant
RAL in the table (€590 million) is higher than the amount indicated in point 9.2.2.2
(€449 million).

With  reference  to  the  table  below,  of  the  projects  to  remain  open  (TRO),  those
having a RAL of more than €1 million account for €460 million or 88% of the total
TRO. An analysis of the files shows the following:

– 

– 

– 

– 

– 

– 

Ongoing litigation with third parties: €38 million (7% of TRO)

Projects managed by the EIB: €61 million (12% of TRO)

Suspension due to political situation: €26 million (5% of TRO)

Funds blocked until advances are justified: €6 million (1% of TRO)

Projects without contracts:€330 million (63% of TRO)

TOTAL: €460 million (88% of TRO)

169

In order  to  make  the  RAL  surveillance  criteria  converge  with  those  applied  to  budget  operations,  the
series is calculated on the  basis  of  24  months  with  no  movement  from  2000  onwards.  There  remains
however  a  difference,  since  the  criteria  is  24  months  with  no  payments  or  contracts  (EDF  secondary
commitments);  for  budget  financed  operations,  the  accounting  system  Sincom1  and  2  is  unable  to
provide that level of detail until financial year 2001.

322

                                                
9.2.2.5 Action to reduce the RAL

(cid:1)  The total RAL of the EDF is in the order of €8.4 billion. Old RAL (€756 million)
accounts for only 9% of global RAL. Dormant RAL (€449 million - no movement
in the last 24 months) corresponds to no more than 5.3% of the total.

(cid:1)  Four specific exercises have been undertaken to reduce old and dormant RAL:

From December 1999 and throughout 2000 specific surveys were undertaken on:

– 

– 

– 

Contracts whose deadlines expired in six months

Advances granted but not cleared

“Sleeping” projects ready to be closed

This exercise resulted in the closure of more than 3000 commitments.

A  more  specific  review  focused  on  old  commitments  was  then  undertaken  from
October  2000.  The  analysis  of  almost  all  of  the  old  commitments  has  now  been
finalised.

In  November  2002,  an  analysis  was  made  of  non-committed  RAC  (reste  à
contracter)  relating  to  financing  decisions  before  1998.  All  delegations  and
operational units have been asked to verify whether an agreement to decommit these
unused balances could be obtained from the local authorities. Furthermore, projects
concluded  in  the  period  1998-2000  with  less  than  10%  contracted  (i.e.  slow
implementation rate) were identified and the departments and delegations concerned
were encouraged to take the necessary steps to accelerate implementation. As a result
of this exercise, old RAL fell in the last two months of 2002 by €138 million (from
€894  million  at  01.11.2002  to  €756  million  at  31.12.2002)  and  sleeping  RAL  by
€68 million (from €517 million at 01.11.2002 at €449 million).

One of the main  obstacles jeopardising  the  reduction of  RAL  is  the  fact  that  under
the EDF the agreement of the National/Regional Authorising Officer (NAO/RAO) is
always  needed  for  closures  of  projects  and  decommitments  of  funds.  Appropriate
guidelines to deal with this situation have been drawn up, including a tacit approval
procedure.

(cid:1)  The  EDF  accounting  system  enables  us  to  break  down  RAL  into  RAC  (reste  à
contracter – uncommitted  balances  on  primary  commitments)  and  RAP  (reste  à
payer  –  remaining  balances  to  be  paid  on  contracts,  secondary  commitments).
Since the Commission pays most EDF invoices within the regulatory deadline (in
2002  86%  of  all  invoices  received  were  paid  within  60  days),  we  can  conclude
that the RAP  is  nearly  at  its  correct  value  (since  there  is  no  substantial  delay  in
payments). Nevertheless, note that in the context of the decentralisation within the
EDF, it is beyond the Commission’s control if there is a backlog in the processing
of invoices by National Authorising Officers.

323

(cid:1)  Therefore, efforts to reduce (old/dormant) RAL should be focused on the RAC
(operational units and delegations); this means decommitting old RAC where
possible and speeding up implementation of slow RAC. Indeed, the absence of
contracts accounts for a large share of the RAL (more than half of old RAL, one-
third of dormant RAL and 65% of total RAL).

(cid:1)  The other measures can be summarised as follows:

– 

– 

– 

– 

Delegations  have  been  informed  that  extensions  to  financial  agreements  are
only allowed in duly substantiated cases and for short periods.

Contractual/financial  officers  in  headquarters  will  ensure  that  the  situation  of
the RAL is systematically incorporated in country review papers so as to boost
decommitments.

Systematically and especially in the course of the devolution exercise, “reports
on  the  financial  management  of  EDF  projects”  will  be  produced  by
headquarters  for  non-devolved  Delegations  and  by  the  financial/contractual
units  in  devolved  Delegations.  These  reports  shall  focus  on  problematic
dossiers  (old  commitments,  sleeping  RAL,  etc.)  in  order  to  promote  the
reduction of RAL.

At  regulatory  level,  the  Commission  has  proposed  the  following  new  articles
for the 9th EDF Financial Regulations (not yet adopted by the Council) to keep
the RAL under control:

– 

– 

– 

Repayment of sums due under “direct labour contracts” (Article 47): the
recourse to new work-programmes  is subject to justification of  advance
payments  still  outstanding  under  previous  approved  work-programmes.
This should keep outstanding RAL under control.

“sunset clause” N+3 for concluding contracts under financing agreements
(Article 55);

Extension of a financing agreement (Article 134). Only one extension is
allowed  for  6th,  7th  and  8th  EDF  commitments,  for  a  period  of  not
longer  than  three  years.  This  should  help  keep  the  RAL  of  such
commitments within acceptable limits.

The relevant departments  in EuropeAid  are currently  drafting  explicit  guidelines  to
inform  all  Delegations  and  units  of  the  consequences  of  these  new  9th  EDF
regulations.  In  addition,  specific  clauses  to  that  end  will  be  included  in  9th  EDF
Financing Agreements concluded between the Commission and the NAO/RAO.

324

Situation of dormant commitments

The  table  below  shows  slow  implementing  commitments  for  each  of  the  6th,  7th  and  8th
EDFs. A commitment is considered dormant or slow if over the 18 months before the end of
the financial year:

(cid:1)  no new contract has been concluded;

(cid:1)  none of the existing contracts have been amended;

(cid:1)  no  payment  or  clearing  of  advances  has  been  recorded  for  contracts  open  before

31 December.

Also  included  are  commitments  not  covered  by  this  definition  but  which  are  blocked  or
suspended. Slow commitments are classified in three categories:

(cid:1)  projects that have to remain open, projects to be closed and projects of uncertain status;

(cid:1)  the  accounting  values  correspond  to  the  above  definition  and  represent  the  amount  of
resources linked to slow commitments (namely the sum of financial resources decided but
not contracted plus those contracted but not paid).

6th EDF

7 th EDF

UNPAID AMOUNT

OF
 COMMITMENT

BALANCE
TO BE LEFT OPEN

BALANCE

UNCERTAIN

TO BE CLOSED

STATUS

UNPAID AMOUNT

OF
 COMMITMENT

BALANCE
TO BE LEFT OPEN

BALANCE

UNCERTAIN

TO BE CLOSED

STATUS

40 801 553.11

19 302 746.57

19 119 177.77

2 379 628.77

171 790 161.31

141 341 483.22

15 818 007.92

14 630 670.17

ALLOCATION

PROGRAMMABLE

AID(1)

SAF

665 962.21

665 962.21

1 128 287.57

101 840.18

793 131.03

233 316.36

EMERGENCY AID

818 078.28

117 194.00

700 884.28

AID FOR REFUGEES

51 551.38

51 551.38

1 605 793.74

1 375 885.74

229 908.00

STABEX

SYSMIN

22 018 268.92

21 818 268.92

200 000.00

33 323.80

16 655.30

16 668.50

INTEREST-RATE
SUBSIDIES

4 438 929.00

4 438 929.00

RISK CAPITAL

500 000.00

500 000.00

18 481 946.00

18 481 946.00

AIDS

1 473 255.53

1 089 431.81

383 823.72

TOTAL

65 510 591.15

41 672 566.87

20 874 571.79

2 963 452.49

198 296 519.70

165 873 933.44

16 857 715.45

15 564 870.81

(1) Includes grants,
special loans and balances of previous Funds.

325

8th EDF

6th + 7th + 8th EDF

UNPAID AMOUNT
OF
COMMITMENT

BALANCE
TO BE LEFT OPEN

BALANCE
TO BE CLOSED

UNCERTAIN
STATUS

UNPAID AMOUNT
OF
 COMMITMENT

BALANCE
TO BE LEFT OPEN

BALANCE
TO BE CLOSED

UNCERTAIN

STATUS

263 187 995.21

251 485 967.35

598 214.71

11 103 813.15

475 779 709.63

412 130 197.14

35 535 400.40

28 114 112.09

6 513 243.01

5 630 000.00

700 000.00

183 243.01

8 307 492.79

5 731 840.18

2 159 093.24

416 559.37

35 000.00

35 000.00

853 078.28

117 194.00

735 884.28

12 165 852.00

12 165 852.00

12 165 852.00

12 165 852.00

1 657 345.12

1 427 437.12

229 908.00

52 724.97

52 724.97

22 104 317.69

21 834 924.22

16 668.50

252 724.97

19 149 839.40

18 830 540.13

319 299.27

23 588 768.40

23 269 469.13

319 299.27

24 736 003.98

24 736 003.98

43 717 949.98

43 717 949.98

1 473 255.53

1 089 431.81

383 823.72

325 840 658.57

312 848 363.46

1 298 214.71

11 694 080.40

589 647 769.42

520 394 863.77

39 030 501.95

30 222 403.70

Conclusion and prospects for 2003

The  figures  and  analysis  show  that  work  to  examine  old  and  dormant  commitments  is
proceeding at a good pace, as shown by the results achieved in 2002: a significant decrease in
dormant  RAL,  sustained  effort  to  raise  the  number  of  commitments  closed  and  amounts
decommitted for old commitments, greater net absolute reduction of old RAL in 2002.

Work  has  already  started  to  transfer  and  incorporate  this  RAL  reporting  into  the  single
management database, the CRIS system.

The adding of budget year 1997 to the old RAL will require further effort to tackle closures
and payments,  given the size of the absolute net increase  in the old portfolio resulting  from
the automatic adding of this budget year. The setting of the 2003 reduction objectives by the
Directorate has been launched and is taking this into account. However, most of the financial
volume  of  old  commitments  in  2003  (pre-1998,  1997  included)  is  accounted  for  by  budget
commitments with final due dates in the accounting system beyond 2003 (at present 80% of
the old RAL portfolio in financial volume).

The  challenge  in  2003  will  be  to  pursue  these  goals  in  an  environment  where  most  of  the
portfolio is managed by the Delegations. Operational Directorates will have to play a decisive
role  in  ensuring  that  objectives  for  reducing  the  old  RAL  and  closing  underperforming
commitments,  plus  the  stricter  policy  on  extensions,  are  understood  and  pursued  by
headquarters and Delegations.

326

9.3

LEGAL AFFAIRS

9.3.1

Dealing with longstanding backlog of disputes

The mapping in 2202 of the longstanding backlog (+/- 80 cases) of disputes is almost
complete. The sorting of the backlog has revealed that a great number of cases can be
considered  closed  simply  because  of  the  time  that  has  elapsed  and  some  disputes
were resolved without the intervention of legal affairs units. To recall, the purpose of
such  an  examination  has  been  to  identify  those  disputes  which  still  need  to  be
examined  and  at  the  same  time  those  which  can  now  definitively  be  closed.  The
identified “live” disputes will then be opened and actively pursued as and when staff
resources so allow. Today, the identified backlog stands at 14 cases and the potential
unidentified backlog at +/- 20 cases.

9.3.2

Current state of active disputes

Compared  with  2001,  when  10  new  disputes  were  recorded,  there  was  a  sharp
increase in disputes in 2002, with 24 new disputes opened. During the same period
16  disputes  were  closed.  Of  the  closed  disputes,  nine  came  from  the  backlog.
Currently,  the  responsible unit is actively dealing  with  38  cases.  New  disputes  that
have arisen seem to be  randomly distributed among all types of contract,  including
disputes about extra-contractual liability.

9.3.3

Complaints  to  the  Ombudsman  and  complaints  made  under  the  Code  of  Good
Administrative Behaviour

During  the  period  30  complaints  were  received  by  the  Ombudsman  and  16  cases
were closed, two with critical remarks. Of the files from the Ombudsman, two cases
have  now  ended  up  at  the  Court  of  Justice  in  Luxembourg  and  are  still  open.
Currently, the unit concerned is dealing actively with 15 complaints. An analysis has
been made of the complaints closed in 2001 with critical remarks, and a report was
sent to management in September 2002.

Three  complaints  concerning  non-respect  of  the  Code  on  Good  Administrative
Behaviour were received.

9.3.4

Cases before the courts

In 2002 the unit concerned became involved in six new cases brought either before
the Court of Justice in Luxembourg or the courts of Brussels.

9.3.5 Measures against corruption

Corruption  and  other  irregularities  is  an  area  of  increasing  concern  for  the  unit  in
charge. This has resulted in it actively following the current major corruption case in
Lesotho and participating in anti-corruption events and meetings. On the basis of its
experience, the unit has developed a training course for staff leaving for Delegations.
The training course has now been given twice with the general ethics course.

327

9.3.6

The Advisory Committee on Procurements and Contracts (ACPC)

The ACPC continued until the end of the  year, handling more than 900 EuropeAid
files. Two members of staff were fully occupied with the closure of the ACPC at the
end of the year. With this closure this work will now take the form of a helpdesk for
the part of EuropeAid’s procurement which would normally have been presented to
the ACPC.

9.3.7

General legal work

With  devolution  the  legal  affairs  and  disputes  Unit  is  frequently  called  on  to  give
advice to colleagues in Delegations on a multitude of problems. These consultations
are often more formal than would have been the case had the question been raised at
HQ before devolution.

The  unit  has  developed  a  series  of  Frequently  Asked  Questions  on  legal
interpretations  and  situations  needing  legal  assistance  that  will  be  published  on
intranet.

Much ad hoc legal work was undertaken in 2002 as follows :

– 

– 

– 

– 

– 

Participation  in  the  inter-service  working  group  for  the  preparation  of  the
framework agreement for Cuba;

Participation  in  the  inter-service  working  group  on  the  Commission’s
Regulation implementing the OCT Council Decision;

Participation in the inter-service working group on the fight against fraud;

Preparation  of  the  Decision  on  the  appointment  of  the  Chief  Authorising
Officer for the EDF;

Preparation  of  the  subdelegation  from  the  EDF  Chief  Authorising  Officer  to
ECHO.

9.4

AUDITS

9.4.1

Internal audits

The  internal  audit  unit  was  set  up  in  August  2001  to  serve  both  the  EuropeAid
Cooperation Office and ECHO. The unit began its full activities in March 2002 when
staff joined. Work started on the basis of the Common Work Programme, which had
previously  been  approved  by  the  Director  General  of  EuropeAid  and  the  Head  of
Service of ECHO.

In the course of 2002 the unit carried out a continuous audit of five of EuropeAid’s
operational directorates, looking at the way they were implementing the 24 Internal
Control  Standards.  An  audit  was  also  carried  out  of  various  aspects  of  the
management of the European Initiative for Democracy and Human Rights (EIHDR).
Recommendations  from  this  audit,  dealing  mainly  with  control  measures,  were
adopted and implemented.

328

The unit has developed a methodology for workload assessment. This methodology
was  tested  in  a  review  of  the  Delegation  in  South  Africa  and  assesses  workload
against  the  staff  resources  following  devolution.  This  exercise  showed  that  the
methodology  was  viable  and  it  will  be  refined  in  the  course  of  time.  The  review
which is required by the Communication of January 2002 on devolution is part of a
series which will continue in 2003, the ultimate aim being to obtain an indication of
the  balance  between  workload  and  staffing  made  available  to  Delegation  in  the
course of devolution.

The unit issued an Internal Audit Manual. It actively participated in the work of the
Commission’s  “Auditnet”  and  liased  with  the  Internal  Audit  Service.  It  also
cooperated with other Relex internal audit units in the framework of the Relex Audit,
and  proffered  advice  on  a  number  of  management  and  control  areas  within
EuropeAid.

9.4.2

External audits of operations

In  2002  the  external  audit  unit  finalised  13  audits  (4  EDF,  2  international
organisations,  1  TACIS,  2  MEDA,  1  ECIP  programme  and  3  Asia).  Among  these,
two were particularly important audits in terms of size and complexity: the ECIP (the
European Community Investment Partners financial instrument) programme and the
Food Aid for the Federation of Russia project.

The year was characterised by a new approach to the organisation of external audits
of the Office. As from 2002, the external audit unit is no longer solely responsible for
all  audits.  In  the  context  of  the  reform  to  shift  responsibilities  to  the  authorising
officers, the operational Directors are responsible for selecting the external audits to
be carried out in their directorates.

To  ensure  consistency  in  the  organisation  of  the  audits  by  the  operational
Directorates, an external audit network of the Office was created. It brings together
representatives of all the operational directorates with the objective of:

– 

– 

– 

– 

– 

– 

addressing the specific needs of the operational directorates and delegations in
‘their’ geographic zones;

proposing the improvement of the systems as a result of the experiences gained
and according to the needs of the services;

collaborating  in  the  establishment  of  standards  of  best  practice  and  rules  and
their interpretation;

ensuring the collection and dissemination of information;

preparing the audit programme and monitoring its implementation;

assuming  the  role  of  ‘pre-clearing’  for  proposals  to  be  submitted  to
Management for decision.

The audit network met eight times. Amongst other tasks, it prepared for the first time
an external audit programme for 2003.

329

In 2002, a framework contract was signed with professional audit firms for carrying
out  audits  of  programmes  and  projects  financed  by  the  budget  of  the  Commission
(TACIS,  CARDS,  MEDA,  Asia,  ALA  programmes  and  the  horizontal  budget
headings). A User Guide, standardised specific terms of reference and a management
tool  were  made  available.  Nine  purchase  orders  for  audit  services  were  signed,
including  one  important  audit  of  the  framework  contract  AMS/451.  One  of  the
purchase orders is for training and will result in the creation of a training syllabus in
external audit, scheduled for completion in 2003. Full information of the framework
contract (audit) was made available, mainly via a web site.

The remaining budgetary resources to launch audits under the EDF are small as the
available  credits  of  the  existing  EDF  framework  contract  have  almost  been  fully
used.  In  November  2002,  the  EDF  Committee  gave  its  approval  for  the  use  of
€5 million  to  finance  future  audits.  Procurement  procedures  for  another  framework
contract audit will be initiated for this purpose.

9.5

TRANSPARENCY AND VISIBILITY

The European Commission has made continuous efforts to improve transparency in
the  management  of  its  external  assistance.  In 2002 the very first  Annual  Report  on
EC  Development  Policy  and  the  Implementation  of  External  Assistance  was  the
subject  of  a  Communication  to  the  Council  and  Parliament  and  then  printed  and
widely  distributed  in  the  eleven  official  languages.  Both  the  Council  and  the
European Parliament acknowledged this undertaking.

As  to  the  visibility  of  the  EC  external  assistance  activities  in  the  field,  the
Commission recorded a significant increase in consultations and visits of its internet
server (www.Europa.eu.int). The number of pages on the website has steadily risen
in  the  course  of  the  year:  the  assistance  activities  in  some  of  the  main  regions  are
already described in considerable detail. The exercise should be completed in 2003.

The  “EU  in  the  World”  portal,  where  people  can  see  the  most  important  external
activities at a single glance, has also received more visitors than in the past.

The  following  table  shows  the  number  of  hits  for  the  different  external  relations
websites on the European Commission server in 2001 and 2002. However, it should
be borne in mind that the number of hits is always larger than the actual number of
times a computer user accesses a particular website, since a hit is recorded for each
element of the webpage (including photographs and links).

330

THE EUROPEAN COMMISSION EXTERNAL RELATION WEBSITES

SERVICES

ADDRESS

AVERAGE
HITS PER
MONTH
IN 2001

AVERAGE
HITS PER
MONTH
IN 2002

DG External Relations

Europa.eu.int/comm/external.relations

2 125 000

3 400 000

DG Development

Europa.eu.int/comm/development

600 000

600 000

EuropeAid
Cooperation Office

Europa.eu.int/comm/europeaid

4 200 000

5 000 000

DG Trade

Europa.eu.int/comm/trade

1 800 000

600 000

DG Enlargement

Europa.eu.int/comm/enlargement

400 000

800 000

ECHO

Europa.eu.int/comm/echo

250 000

90 000

The EU in the World

Europa.eu.int/comm/world

200 000

700 000

331

9.6

EC COMMUNICATIONS REFERRING TO EXTERNAL ASSISTANCE
IN 2002

Title of Communication

Reference

Date

Untying: Enhancing the effectiveness of aid

COM(2002)639 18.11.2002

Proposal  for  a  COUNCIL  DECISION  concerning  the  coverage  of
costs  incurred  by  the  EIB  for  the  management  of  the  Investment
Facility of the Cotonou Agreement

COM(2002)603 07.11.2002

Participation of Non-State Actors in the EC Development Policy

COM(2002)598 07.11.2002

Proposal for a COUNCIL REGULATION to avoid trade diversion
into the European Union of certain key medicines

COM(2002)592 30.10.2002

Proposal for a COUNCIL DECISION on the position to be adopted
by  the  Community  within  the  ACP-EC  Council  of  Ministers
regarding a decision on the reallocation of unallocated resources as
well  as  uncommitted  interest  subsidies  from  the  eighth  European
Development Fund

COM(2002)582 25.10.2002

Trade and Development: Assisting Developing Countries to benefit
from Trade

COM(2002)513 18.09.2002

Proposal  for  a  COUNCIL  DECISION  on 
conclusion  on  behalf  of 
International Cocoa Agreement 2001

the  signing  and
the

the  European  Community  of 

COM(2002)438 30.07.2002

Fighting rural poverty - European Community policy and approach
to rural development and sustainable natural resources management
in developing countries

COM(2002)429 25.07.2002

Energy cooperation with the developing countries

COM(2002)408 17.07.2002

Financial Information on the European Development Funds

COM(2002)372 09.07.2002

for 

a  REGULATION  OF  THE  EUROPEAN
Proposal 
PARLIAMENT AND OF THE COUNCIL concerning Community
cooperation  with  Asian  and  Latin  American  countries  and
amending Council Regulation (EC) No 2258/96

COM(2002)340 02.07.2002

Administrative reform of the Unified External Service

SEC(2002)745

02.07.2002

Recommendation  for  a  COUNCIL  DECISION  authorising  the
Commission  to  negotiate  Economic  Partnership  Agreements  with
the ACP countries and regions

COM(2002)168/
final
2  –  no 
SEC(2002)351

09.04.2002

Health and Poverty Countries Reduction in Developing

COM(2002)129 22.03.2002

332

Water Management in Developing Countries Policy  And Priorities
for EU Development Cooperation

COM(2002)132 12.03.2002

Proposal  for  a  REGULATION  of  the  European  Parliament  and  of
the  Council  on  aid  for  policies  and  actions  on  reproductive  and
sexual health and rights in developing countries

COM(2002)120 07.03.2002

Education  And  Training  In  The  Context  Of  Poverty  Reduction  In
Developing Countries

COM(2002)116 06.03.2002

Proposal  for  a  REGULATION  of  the  European  Parliament  and  of
the  Council  on  aid  for  poverty  diseases  (HIV/AIDS,  malaria  and
tuberculosis) in developing countries

COM(2002)109 04.03.2002

Preparation  of  the  International  Conference  on  Financing  for
Development (Monterrey, Mexico, 18-22 March 2002)

COM(2002)87

13.02.2002

Towards a global partnership for sustainable development

COM(2002)82

13.02.2002

Responses to the Challenges of Globalisation:

A study on the International Monetary and Financial System and on
Financing for Development

COM(2002)81

13.02.2002

Reform  of  Community  aid:  Plan  for  the  implementation  and
financing of devolution

SEC(2002)85

30.01.2002

The European Union’s Contribution to Afghanistan Reconstruction:

Approach to the Tokyo Ministerial Conference, 21/22 January 2002

SEC(2002)43

15.01.2002

Establishment  of  a  European  Commission  (EC)  Office 
Afghanistan

in

SEC(2002)31

15.01.2002

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9.7

EC ASSISTANCE NOT COVERED BY THIS REPORT

Like the previous report, the 2002 report covers all the external assistance activities
managed by the EuropeAid Cooperation Office in line with the Commission’s reform
of its management practice.

Humanitarian  and  pre-accession  aid  do  not  fall  within  the  scope  of  the  report.
Nevertheless  a  concise  description  of  ECHO’s  interventions  forms  integral  part  of
the  whole  EC  contribution.  For  a  detailed  account  of  ECHO’s  humanitarian
activities, the reader is advised to consult the ECHO Annual Report 2002.170

The same  can  be  said  about  macrofinancial  assistance  to  third  countries,  for  which
Directorate General for Economy and Finances is fully responsible. These activities
are reported on in separate documents.171

The  Commission  implements  macrofinancial  assistance  (MFA)  in  association  with
support  programmes  of  the  IMF  and  the  World  Bank,  and  after  consulting  the
Economic  and  Financial  Committee  and  securing  a  Council  Decision.  MFA
incorporates  a  set  of  principles  which  underline  its  exceptional  character  (ad-hoc
Council  Decisions),  its  complementarity  to  financing  from  international  financial
institutions  and  its  macroeconomic  conditionality.  It  is  an  instrument  designed  to
help  the  beneficiary  countries  experiencing  serious  but  generally  short-term
macroeconomic  imbalances  (serious  balance  of  payments  and  fiscal  difficulties).
In close co-ordination  with  IMF  and  World Bank  programmes,  MFA has promoted
policies  that  are  tailored  to  specific  country  needs  with  the  overall  objective  of
stabilising 
financial  situation  and  establishing
market-oriented economies.

the  external  and 

internal 

In 2002, €141 million of MFA were disbursed, comprising €130 million grants to the
Balkans:  €115  million  to  Yugoslavia,  €15  million  to  Kosovo  and  €11  million  to
Armenia.

170

171

http://europa.eu.int/comm/echo/information/publications/echos_annual_reports_en.htm
http://europa.eu.int/comm/dgs/economy_finance/index_en.htm-

334