Communication from the Commission to the Council - Financial Information on the European Development Funds
Date: 2004-05-25
Institutions: European Commission
Subjects: European Development Fund, administrative structures, financial management, financial year

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 25.5.2004 
COM(2004) 382 final 

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COMMUNICATION FROM THE COMMISSION TO THE COUNCIL 

Financial Information on the European Development Funds 

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COMMUNICATION FROM THE COMMISSION TO THE COUNCIL 

Financial Information on the European Development Funds 

TABLE OF CONTENTS 

Introduction ................................................................................................................................ 3 

Executive Summary ................................................................................................................... 4 

1. 

1.1. 

1.2. 

Implementation of the European Development Funds at 31 December 2003 ............. 7 

Historical background .................................................................................................. 7 

Implementation of the EDFs in 2003........................................................................... 9 

1.2.1.  Commitments ............................................................................................................... 9 

1.2.2.  Payments .................................................................................................................... 10 

1.2.3.  Breakdown of commitments and payments by instrument ........................................ 10 

1.2.4.  Financial operations in 2003 ...................................................................................... 12 

2. 

2.1. 

2.3. 

Financial implementation forecasts for 2004 and 2005 ............................................. 12 

Overall outlook for implementation of the EDF........................................................ 12 

Commitments ............................................................................................................. 13 

2.3.1. 

2004............................................................................................................................ 13 

2.3.2. 

2005............................................................................................................................ 14 

2.4. 

Payments .................................................................................................................... 14 

2.4.1. 

2004............................................................................................................................ 14 

2.4.2. 

2005............................................................................................................................ 15 

2.5. 

2.6. 

Calls for contributions scheduled for 2004 and 2005 ................................................ 16 

Contributions to be paid by the Member States in the second and third 
tranches for 2004........................................................................................................ 17 

Abbreviations and acronyms.................................................................................................... 18 

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Introduction 

This  document  is  to  be  annexed  to  the  draft  budget  for  2005,  in  accordance  with  the  1979 
agreements on budgetary procedure. 

Article  8(3)  of  the  Financial  Regulation  of  27  March  2003  applicable  to  the  9th  European 
Development  Fund1  (EDF)  requires  the  Commission  to  make  this  document  available  to  the 
Council by 15 June, stipulating that this information serves as a basis for an interim estimate of 
commitments and payments. 

As in previous years, this document shows: 

- 

- 

- 

EDF implementation at 31 December 2003; 

financial implementation forecasts for the current year (2004); 

expenditure forecasts for 2005. 

Since the entry into force of the 9th EDF, the Member States have made direct contributions to 
the European Investment Bank (EIB) for the 9th EDF instruments it manages (the Investment 
Facility and interest-rate subsidies), while contributions for the old instruments managed by the 
EIB  (risk  capital  and  interest-rate  subsidies)  continue  to  go  through  the  Commission.  This 
communication therefore draws a clear distinction between EIB payments under the 9th EDF 
and Commission payments (including payments under old instruments managed by the EIB).  

In accordance with Article 38 of the Financial Regulation, this communication is accompanied 
by a proposal for a Council Decision on the second tranche of contributions to be paid by the 
Member States for 2004. 

Further  details  on  implementation  of  the  EDF  at  31 December 2003  will  be  given  in  the 
forthcoming  Commission  communication  to  the  Court  of  Auditors,  the  European  Parliament 
and the Council containing the balance sheets and accounts of the EDF for 2003. 

1 

OJ L 83, 1.4.2003, p. 1. 

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Summary 

For each ACP country2 and OCT3, the Commission has updated its commitment and 
payment forecasts for 2004 and 2005. As in 2003, the Commission has taken great 
care  when  estimating  payments  in  order  to  minimise  the  risk  that  Member  States 
might  earmark  too  great  an  amount  in  their  national  budgets.  As  in  the  past,  these 
estimates will be reviewed in October’s communication.  

The  EIB  has  also  updated  its  forecasts  for  instruments  of  both  the  9th  EDF  and 
previous Funds. The full figures are set out in this communication. 

Commitments 

Though  the  Commission  and  the  EIB  implemented  a  great  volume  of  new 
commitments  in  2003  (EUR 4 127 million),  far  exceeding  the  target  figure  of 
EUR 3 200 million,  the  November 2003  forecast  for  2004  has  been  raised  slightly 
(from  EUR 3 275 million 
forecasts  are 
EUR 500 million  for  the  EIB  (up  EUR 50 million)  and  EUR 2 850 million  for  the 
Commission  (up  EUR 25 million).  Of  the  Commission’s  EUR  2 850  million, 
EUR 250 million is earmarked for support for the new Peace Facility for Africa. 

to  EUR 3 350 million).  The  new 

Initial  estimates  for  2005  suggest  that  commitments  will  remain  relatively  high,  at 
EUR 3 420 million. 

The  sums  set  out  above  for  2004  and  2005,  EUR 75 million  and  EUR 225 million 
respectively,  are  provisional  figures  for  the  new  Water  Facility.  The  Commission 
stresses that work is still getting under way and that these figures should be viewed 
with caution. 

Payments 

(EUR 2 427 million 

totalled  EUR 2 431 million 

In  2003  payments 
the 
Commission  and  EUR 4 million  for  the  EIB),  which  is  the  highest  they  have  ever 
been  since  cooperation  agreements  and  conventions  with  the  ACP  countries  and 
OCTs  began.  Though  the  Commission  achieved  its  objective  (EUR 2 430 million), 
there have been delays in the EIB’s implementation of the new Investment Facility 
(of the forecast EUR 70 million, only EUR 4 million has been implemented). Indeed, 
the  Commission  could  have  disbursed  another  EUR 270 million  if  it  had  had 
sufficient financial resources. This sum was paid at the start of 2004.  

for 

For  2004  the  EIB  has  revised  payments  downwards  (from  EUR 260 million  to 
EUR 168 million), but this reduction is more than offset by the upwards revision of 
payments  to  be  made  by  the  Commission  (EUR 2 455 million,  compared  with  the 
EUR 2 240 million  estimated  in  November 2003).  Total  payments  by  the  two 

2 
3 

African, Caribbean and Pacific States. 
Overseas Countries and Territories. 

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institutions are now estimated at EUR 2 623 million, compared with the estimate of 
EUR 2 500 million  made  in  the  November 2003  communication.  These  figures  are 
based  on  the  assumption  that  2004  will  see  only  limited  payments  from  the  Water 
Facility  (a  lump  sum  of  EUR 10 million  has  been  earmarked  to  cover  start-up 
payments for the Facility).  

Initial estimates put the total for 2005 at EUR 2 975 million, EUR 240 million of it 
for  the  EIB  (9th  EDF  instruments),  EUR 2 585 million  for  traditional  instruments 
managed by the  Commission and EUR 150 million provisionally earmarked for  the 
Water  Facility.  As  for  the  Peace  Facility,  the  Commission  has  yet  to  make  any 
allocations for 2004 because there is still no sign of practical operations. 

Calls for contributions in 2004 

to  be  paid  by 

the  Member  States 

Though  the  total  volume  of  payments  in  2004  has  been  revised  upwards,  this 
increased volume can currently be implemented without increasing the overall 
in  2004 
volume  of  contributions 
(EUR 2 440 million). There are two reasons for this: (i) the EIB ended 2003 with a 
relatively  large  amount  of  unused  financial  resources,  so  reducing  needs  for  2004, 
and  (ii)  the  Commission  revised  its  cash  position  at  the  end  of  2004  downwards. 
Maintaining  the  overall  level  of  contributions  set  out  in  the  communication  of 
November 2003 should cover the current estimated needs of both the EIB (in view of 
the  reserves  built  up  at  the  end  of  2003)  and  the  Commission  (see  table  in  2.5).  If 
payment  forecasts  hold  good,  the  EIB’s  needs  in  2004  will  be  covered  by  the  first 
tranche  already  received.  The  Commission  is  asking  the  Member  States  to  pay 
EUR 1 100 million  for  the  second  2004  tranche  and  the  balance  (EUR 490 million) 
for the final 2004 tranche.  

The  proposal  for  a  Council  Decision  on  the  second  tranche  of  the  contributions  is 
being submitted to the Council along with this communication. As regards the final 
tranche,  the  Commission  and  the  EIB  will  reassess  the  situation  in  October  and,  if 
need be, adjust their position in the light of developments. 

The future 

The  Commission  and  the  EIB  renew  their  pledge  to  do  everything  they  can  to 
commit the funds made available by the Cotonou Agreement (including the balances 
remaining from the 6th, 7th and 8th EDFs transferred to the 9th EDF) by the end of 
2007. This, however, presupposes that the political situation in all ACP countries is 
such that the conditions required for disbursing the funds are met. The cooperation 
agreements (Lomé and Cotonou) are rooted in the principle of partnership between 
the  Union  and  the  ACP  countries,  which  means  that  implementation  of  the  EDF 
depends on the absorption capacity (political stability, quality of governance, etc.) of 
the ACP countries. As regards the budget aid (structural adjustment programmes and 
the  HIPC  debt-relief  instrument)  which  accounts  for  a  growing  proportion  of  aid, 
the  ACP  countries’  compliance  with  certain 
payments  are  conditional  on 
macroeconomic  conditions.  Last  but  not  least,  utilisation  of  funds  provided  by  the 
Cotonou  Agreement  will  also  depend  on  the  results  of  any  reallocation  of  funds 
following the mid-term and final reviews scheduled for 2004 and 2006 respectively. 

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Revision of the November 2003 estimates of commitments and payments 

2003 
November 2003 
communication 

Revised 
figure 

2004 
November 2003 
communication 

Revised 
figure 

2005 
November 2003 
communication 

Revised 
figure 

EUR million

COMMITMENTS 

Traditional Commission instruments4 
Peace Facility 
Water Facility 

   Total for the Commission 

9th EDF EIB instruments 

   TOTAL 

PAYMENTS 

Traditional Commission instruments 
Old EIB instruments 
Peace Facility 
Water Facility 

   Total for the Commission 

9th EDF EIB instruments 

   TOTAL 

2855 
- 
- 

2855 

345 

3200 

2212 
218 
- 
- 

2430 

70 

2500 

3761 
- 
- 

3761 

366 

4127 

2192 
235 
- 
- 

2427 

4 

2431 

2825 
- 
- 

2825 

450 

3275 

2070 
170 
- 
- 

2240 

260 

2500 

2525 
250 
75 

2850 

500 

3350 

2275 
170 
- 
10 

2455 

168 

2623 

- 
- 

4350 

2875 

2650 
- 
225 

2875 

545 

3420 

2500 
85 
- 
150 

2735 

240 

2975 

4 

Including old EIB instruments for 2003. There are no more commitments under these instruments as of 2004. 

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1. 

Implementation of the European Development Funds at 31 December 2003 

1.1. 

Historical background5 

The table in Annex 1 provides consolidated figures for the 6th, 7th, 8th and 9th EDFs 
for the ACP countries and OCTs at 31 December 2003. Allocations6 for the 6th, 7th 
and 8th EDFs totalled EUR 32 813 million, of which EUR 30 161 million (92%) had 
been  committed.  Of  the  sum  committed,  EUR 23 436 million  (78%)  had  been  paid. 
Following  the  entry  into  force  of  the  Cotonou  Agreement  and  in  accordance  with 
Article 133  of  the  9th  EDF  Financial  Regulation,  the  Commission  transferred 
uncommitted resources from the old EDFs – a total of EUR 2 684 million - to the 9th 
EDF.  Most  of  these  resources  were  transferred  to  national  indicative  programmes, 
regional indicative programmes and intra-ACP cooperation. 

The table below sets out the position of the 9th EDF at 31 December 2003. With the 
transfers, the total amount available to the Commission and the EIB at the end of the 
year  was  EUR 15 493 million.7  Of  this  amount,  about  EUR 3 522  million8  was 
committed in 2003, leaving a total of EUR 11 970 million still available. 

5 
6 
7 

8 

The allocations referred to in this chapter do not include the conditional envelope of EUR 1000 million. 
Before remaining balances were transferred to the 9th EDF. 
Transfer  of  EUR  2 684  million  +  the  9th  EDF  envelope  (EUR 12 800  million,  not  counting  the 
conditional EUR 1 000 million) + interest of EUR 9 million. 
Net sums (after deduction of decommitments). 

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9th EDF (including transfers from 
earlier EDFs) 

Allocations 

Commitments 

National and OCT allocations 
CDE9, CTA10 and JPA11 
Long-term development reserve 
Intra-ACP cooperation 
Other regional cooperation 
Regional cooperation reserve 
Studies and TA12 for OCTs 

Costs of implementation 
Miscellaneous revenue 

Subtotal for the Commission

PM: Funds managed by the EIB 
- Interest-rate subsidies 
- Investment Facility 

Subtotal for the EIB

10.353.483.544 
64.899.000 
294.761.843 
1.435.707.733 
939.989.549 
0 

2.000.000 
125.000.000 
32.216.776 
13.248.058.445 

2.064.059.870 
37.878.000 
0 
759.798.156 
169.055.476 
0 

652.157 
125.000.000 
0 
3.156.443.659 

187.850.000 
2.057.000.000 
2.244.850.000 

0 
366.000.000 
366.000.000 

Still to be 
committed 

8.289.423.674 
27.021.000 
294.761.843 
675.909.577 
770.934.073 
0 

1.347.843 
0 
32.216.776 
10.091.614.786 

0,00 
187.850.000 
1.691.000.000 
1.878.850.000 

Total for the 9th EDF

15.492.908.445 

3.522.443.659 

11.970.464.786 

The  following  chart  shows  the  trend  in  commitments  (before  decommitment)  and 
recovery).  Since  1990  decisions  have  averaged  about 
payments 
EUR 2 220 million and payments EUR 1 675 million. 

(before 

Commitments and payments (1990-2003)
Commission and EIB
(EUR '000, nominal terms)

0
0
0

'

R
U
E

4.500

3.500

2.500

1.500

500

-500

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

commitments

payments

953

1.433 2.236 1.843 2.689 1.874 1.538

784

2.606 2.958 4.007 1.921 2.115 4.127

1.257 1.191 1.984 1.443 1.860 1.758 1.509 1.382 1.595 1.352 1.640 2.124 1.902 2.431

9 
10 
11 
12 

Centre for the Development of Enterprise. 
Technical Centre for Agricultural and Rural Development. 
Joint Parliamentary Assembly. 
Technical assistance. 

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1.2. 

Implementation of the EDFs in 2003 

In terms both of commitments and payments, the EDF’s performance in 2003 was the 
best  since  cooperation  agreements  and  conventions  with  the  ACP  countries  first 
began.  

1.2.1.  Commitments 

In  2003  the  Commission’s  new  commitments  totalled  EUR 3 761 million.  The  EIB, 
which  manages  9th  EDF  resources  for  the  new  Investment  Facility  and  interest-rate 
subsidies  autonomously,  committed  EUR 366 million.  This  makes  a  total  of 
EUR 4 127 million.  The  only  other  year  in  which  such  figures  were  achieved  was 
2000 (EUR 4 007 million). However, the level of EDF commitments has to be seen in 
its historic context. With the entry into force of the Cotonou Agreement, 2003 marked 
the start of a new commitment cycle.  

Commitments  under  the  6th,  7th  and  8th  EDFs  were  relatively  limited.  They 
respectively  amounted  to  EUR 25  million,  EUR 102 million  and  EUR 447 million,  a 
total of EUR 574 million. Note that commitments under previous EDFs ceased to be 
authorised  when  the  Cotonou  Agreement  came  into  force  on  1 April 2003.  The 
remaining  balances  were  transferred  to  the  9th  EDF.  So  it  is  obvious  that  the  lion’s 
share,  a  total  of  EUR 3 186 million,  was  committed  under  the  9th  EDF.  The  A 
for 
(macroeconomic 
envelopes 
EUR 1 844 million or 58%.  

sectoral  policies,  etc.)  accounted 

support, 

The Commission decommitted some EUR 365 million, resulting in net commitments 
of EUR 3 396 million from Commission-managed EDF resources.  

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1.2.2.  Payments 

The  Commission  paid  out  EUR 2 236  million.  It  also  made  a  Stabex  transfer  of 
EUR 191 million  to  a  secure  account  opened  for  Sudan,  taking  total  payments  to 
EUR 2 427 million.13  The  EIB,  for  its  part,  disbursed  EUR 4 million  from  the 
Investment Facility, making a total of EUR 2 431 million for the two institutions.  

Payments  (including  the  abovementioned  transfer)  by  the  Commission  in  2003 
constituted  an  EDF 
in  2001  by  14% 
record.  They  exceed  payments 
(EUR 2 124 million,  the  previous  EDF  record)  and  payments  in  2002  by  28% 
(EUR 1 902 million). 

The  Commission’s  self-imposed  objective  for  2003  was  EUR 2 430 million 
(EUR 2 500 million  minus  the  EUR 70 million  earmarked  for  the  EIB  for  the 
Investment Facility). The Commission therefore achieved its objective. However, with 
payments of the order of EUR 4 million, the EIB failed to achieve the forecast levels 
(EUR 70 million) owing to signing delays in 2003. 

Note  that  a  shortage  of  funds  obliged  the  Commission  to  carry  over  the  payment  of 
about  EUR 270 million  to  the  start  of  2004.  However,  EUR 170 million  was  paid  to 
the Global Fund to fight HIV/AIDS, tuberculosis and malaria in December 2003. 

Whereas the lion’s share of commitments were made under the 9th EDF, the bulk of 
payments in 2003, which marked the beginning of a new EDF cycle, quite naturally 
concerned previous EDFs (EUR 68 million, EUR 396 million and EUR 1 494 million 
under the 6th, 7th and 8th EDFs respectively, compared with EUR 278 million from 
the new 9th EDF). 

The  Commission  recovered  some  EUR 56 million,  resulting  in  net  payments  of 
EUR 2 370 million from Commission-managed EDF resources.  

1.2.3.  Breakdown of commitments and payments by instrument 

For information purposes, the following table breaks down spending by instrument for 
the years 2002 and 2003.  

13 

The Stabex transfer to a special account is not a payment in accounting terms. However, this figure has 
been included in past reports. For the sake of consistency with earlier reports, the Commission has opted 
to continue adding up payments and transfers for 2003. The Stabex transfer was practically the last to be 
made under this old instrument. 

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2002 

2003 

Commitments Payments  Commitments  Payments 

EUR million 

PROGRAMMES MANAGED BY 
THE COMMISSION 
Indicative programmes 
Grants 
Special loans 
Total 

Excluding indicative programmes 
Interest-rate subsidies 
Emergency aid 
Aid for refugees 
Risk capital 
Mining products 
Stabex 
Structural adjustment facility 
Debt relief (HIPC) 
Transfer from other funds 
Use of interest 
Studies and technical assistance for 
OCTs 
Total 

9th EDF and transitional 
measures  
Envelope A 
Envelope B 
Regional projects 
Intra-ACP projects (Cotonou) 
Costs of implementation 
Other 
Total 

Total managed by the 
Commission 

PROGRAMMES MANAGED BY 
THE EIB (9th EDF) 
Investment Facility 

835,2

973,8

0,6   

835,2

974,3

16,5
17,5
51,8
219,6

109,3
60,0
6,7
5,0

486,4

18,5
18,0
19,4   
187,7
87,4
1,6   

289,3
180,0   
27,2
1,3

0,0

830,5

477,9
255,0

84,7
13,0

60,0   

792,9

97,7

213,2 

213,2 

13,6 
2,3 

240,3 
2,5 

5,0 

3,0 
11,5 

0,7 

278,8 

1.918,5 
220,3 
177,6 
759,8 
154,8 
37,9 
3 268,8 

1.073,0
0,0
1.073,0

8,5
6,4
32,1
226,6
40,3
191,014
174,5
209,0
17,8
7,7

0,3

914,1

162,9
44,8
1,6
230,4

439,6

2 114,5

1 902,5

3 760,8 

2 426,7

366,2 

4,0

TOTAL FOR THE EDF 

2 114,5

1 902,5

4 127,0 

2 430,7

14 

See preceding footnote. 

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1.2.4.  Financial operations in 2003 

The  table  below  gives  the  start-of-year  and  end-of-year  balances  for  2003,  the 
Member  States'  contributions  to  the  EDF  and  payments.  Note  that  the  Commission 
ended  2003  with  a  cash  balance  of  EUR 82 million  on  its  current  account.  This  is 
markedly  lower  than  in  previous  years  and  shows  that  the  Commission  is  doing 
everything it can to use the financial resources placed at its disposal by the Member 
States  efficiently.  Though  the  Member  States  had  paid  only  EUR 72 million  of  the 
EUR 80 million  requested,  the  EIB,  however,  ended  the  year  with  a  cash  surplus  of 
EUR 68 million  owing  to  the  overestimation  of  needs  for  the  first  year  of  the 
Investment Facility’s implementation. 

EUR million 

COMMISSION 

EIB 

TOTAL 

Current 
expenditure 

Stabex 

(9th 
EDF) 

230,1

210,8

440,9

2.024,2  

71,5 

2.095,7

1,4  

6,1

56,2  

2,4  

1,4

8,5

-2.235,8

-191,0  

-4,0 

-2.430,9

82,3

22,2  

67,5 

171,9

Balance at 
1 January 200315 

2003 contributions paid 
before 31 December 2003 

2004 contributions paid 
before 31 December 2003 

Interest/Other 

Recoveries 

Payments/transfer 
Balance at 
31 December 2003 

2. 

FINANCIAL IMPLEMENTATION FORECASTS FOR 2004 AND 2005 

2.1. 

Overall outlook for implementation of the EDF 

The Commission renews its pledge to do everything it can to mobilise the funds made 
available by the Cotonou Agreement (including the balances remaining from the 6th, 
7th  and  8th  EDFs  transferred  to  the  9th  EDF)  by  the  end  of  2007.  It  is  clear  that 
achievement  of  this  objective  is  not  up  to  the  Commission  alone.  Indeed,  the  very 
nature of the cooperation agreements (Lomé and Cotonou), namely the fact that they 
are  based  on  partnership,  means  that  the  rate  at  which  the  EDF  is  implemented  will 
depend  on  the  absorption  capacity  of  the  ACP countries  (sufficiently  stable  political 

15 

Minus EUR 88.45 million in contributions for 2003 paid before 1 January 2003. 

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situation,  basic  governance,  etc).  Although  the  Commission  endeavours  to  give 
national  authorising  officers  as  much  technical  assistance  as  possible,  it  cannot 
actually  take  the  place  of  the  ACP  country.  Another  determining  factor  will  be  the 
reallocation of funds scheduled to take place when the mid-term review is carried out 
in 2004 and the final review in 2006. 

2.3. 

Commitments 

2.3.1. 

2004 

Reminder: 

In  the  communication  of  November  200316  the  Commission  and  the  EIB  estimated 
total commitments in 2004 at EUR 3 275 million, broken down as follows: 

•  EUR 450 million for the instruments managed by the EIB under the 9th EDF, and 

•  EUR 2 825 million for the instruments managed by the Commission (including old 

EIB instruments). 

These  figures  did  not  take  account  of  the  possible  mobilisation  of  the  conditional 
resources (EUR 1000 million) referred to in Article 2(2) of the Internal Agreement on 
the  financing  and  administration  of  Community  aid  signed  in  Brussels  on 
18 September 2000.17 

Position at 30 April 2004: 

•  By  the  end  of  April  the  EIB  had  committed  a  total  of  EUR 60 million  from  the 

Investment Facility (and no 9th EDF interest-rate subsidies).  

•  Commitments 

from 

instruments  managed  by 

the  Commission  stood  at 
EUR 526 million. Note that the commitment procedure is such that a large number 
of pending commitments accumulate in the first half of the year. Most are projects 
in  the  course  of  adoption  by  the  Commission  which  require  consultation  of  the 
Member  States.  At  the  start  of  April  this  volume  stood  at  EUR 768 million.  The 
total  therefore  rises  to  EUR 1  294  million  (final  amounts  and  those  pending 
adoption). 

Outlook for implementation to the end of 2004 

•  The  EIB 

is 

increasing 

to 
EUR 500 million (up EUR 50 million). Of this EUR 500 million, EUR 450 million 
is  earmarked  for  the  Investment  Facility  and  the  remaining  EUR 50 million  for 
operations eligible for interest-rate subsidies. 

its  forecast  for  2004  from  EUR 450 million 

16 

17 

COM(2003) 720 final, 21.11.2003. EDF: Estimate of decisions, payments and contributions to be paid by 
the  Member  States  for  2003  and  2004  and  forecast  of  decisions  and  payments  for  the  period 
2005 to 2008. 
OJ L 317, 15.12.2000, p. 355. 

EN 

13 

   EN 

 
                                                 
•  For the Commission, the new estimates for the year 2004, made in the first quarter 
of the year in close cooperation with central and local departments in the various 
ACP  countries,  put  the  total  for  the  year  at  EUR 2 850 million.  This  is  slightly 
(EUR 25 million) higher than last November’s estimate. The mobilisation rate for 
the  Water  Facility,  adopted  by  the  Council  in  March 2004,  remains  uncertain.  At 
this point the Commission’s estimate for 2004 is EUR 75 million. The position will 
be reassessed in the October 2004 communication. 
Though  the  Commission  far  exceeded  its  estimates  in  2003  (implementing 
EUR 3 761 million  rather  than  the  forecast  EUR 2 855 million),  this  performance 
will not adversely affect the volume of commitments forecast for 2004. 

•  In 

the 

total, 

(up 
EUR 75 million),  EUR 500 million  of  them  for  the  EIB  (up  EUR 50 million)  and 
EUR 2 850 million for the Commission (up EUR 25 million). 

level  of  commitments 

is  EUR 3 350 million 

revised 

2.3.2. 

2005 

Whereas  the  Commission,  in  its  November 2003  communication,  based  its  forecasts 
for  2005  on  the  commitment  cycle  observed  in  previous  EDFs,  it  has  now  based  its 
forecasts on real projects. Tentatively assuming that EUR 225 million are committed 
from the Water Facility, forecast commitments are EUR 2 875 million. As regards the 
new instruments managed by the EIB, the Bank reckons that it will be able to commit 
EUR 545 million.  Commitments  for  the  Commission  and  the  EIB  would  therefore 
total EUR 3 420 million (EUR 2 875 million plus EUR 545 million). Maintaining this 
relatively  high  level  reflects  the  pledge  made  by  the  Commission  and  the  EIB  to 
mobilise all the sums made available by the Cotonou Agreement. 

2.4. 

Payments 

2.4.1. 

2004 

Reminder: 

In the November 2003 communication, the Commission and the EIB assumed a total 
of EUR 2 500 million for 2004, broken down as follows: 

•  EUR 260 million for the instruments managed by the EIB under the 9th EDF, and 

•  EUR 2 240 million for the instruments managed by the Commission (including old 

EIB instruments). The Commission considered this a cautious estimate. 

State of implementation at 30 April 2004: 

•  At 30 April 2004 the EIB had made payments of EUR 19 million. 

•  Since several Member States paid contributions for 2003 at the beginning of 2004, 
the Commission was able to disburse fairly early in 2004 the EUR 270 million put 
on hold at the end of 2003 owing to a lack of funds. These payments included an 
initial  tranche  of  EUR 100 million  for  the  World  Bank’s  new  HIPC  (debt-relief) 
initiative.  Adopted  in  the  summer  of  2003,  this  initiative  totals  EUR 460 million. 
By  the  end  of  April  EUR 660 million  had  been  paid  out  and  projects  totalling 

EN 

14 

   EN 

 
 
EUR l88 million  appraised.  This  high  rate  of  payments  could 
Commission short of cash before the summer.  

leave 

the 

Outlook for implementation to the end of 2004 

•  The  EIB  has  revised  its  forecasts  downwards,  from  EUR 260 million  in 
October 2003 to EUR 168 million now (down EUR 92 million). Implementation of 
this 
the  new  Investment  Facility 
EUR 168 million,  EUR 163  million  is  earmarked  for  the  Investment  Facility  and 
the remaining EUR 5 million for operations eligible for interest-rate subsidies. 

initially  forecast.  Of 

is  slower 

than 

•  As last year, the Commission has been particularly careful when updating payment 
estimates.  For  each  country,  it  has  drawn  up  forecasts  per  project  (commitment) 
and  per  contract  (assigned  funds).  The  new  forecast  results  in  a  total  for  the 
Commission of EUR 2 455 million, which is EUR 215 million more than expected 
in October 2003. As regards the HIPC (debt-relief) initiative, an initial tranche of 
EUR 100 million  has  already  been  paid  to  the  World  Bank  in  January 2004,  as 
pointed out above. The Commission is unable to say at this point whether a second 
tranche  will  need  to  be  disbursed  before  the  end  of  the  year.  Just  in  case, 
EUR 50 million  has  been  reserved.  Lastly,  the  Commission  has  earmarked 
EUR 10 million  to  cover  start-up  payments  for  the  new  Water  Facility.  The 
situation will be reassessed in the October 2004 communication.  

•  In 

total, 

the  EIB  and 

to 
the  Commission’s 
EUR 2 623 million,  EUR 123 million  more  than  was  estimated  in  November 
(EUR 2 500 million). 

revised  needs  amount 

2.4.2. 

2005 

For 2005 the forecast total is EUR 2 975 million, comprising: 

•  EUR 240 million for the EIB from the 9th EDF, EUR 6 million of it for interest-

rate subsidies; 

•  EUR 2 735 million  for  the  instruments  traditionally  managed  by  the  Commission, 

including:  

traditional 
EUR 2 585 million 
committed under previous EDFs) and 

for 

instruments 

(including  EIB 

instruments 

EUR 150 million from the first tranche of EUR 250 million granted by the Council 
estimate); 
from 

in  March 2004 

the  Water 

(preliminary 

Facility 

as  for  2004,  the  Commission  has  yet  to  make  any  allocations  under  the  Peace 
Facility because there is still no sign of practical operations. 

Given  that  they  concern  a  fairly  long  time  frame,  the  figures  must  be  treated  with 
caution. This is particularly true of the Water Facility, which is still getting under way.  

EN 

15 

   EN 

 
 
 
 
 
2.5. 

Calls for contributions scheduled for 2004 and 2005 

The following table summarises financial forecasts for 2004 and 2005. 

EUR million 

Commission

EIB 

TOTAL

Commission 
(incl. EIB 6th 
to 8th EDFs) 
82

96

-1

(9th EDF) 

68 

8 

150

104

-1

2 315

125 

2 440

5   

10

50

-2 455
102

2 680

5   

50

-2 735
102

5

10

50

-168 
33 

207 

-2 623
135

2 887

5

50

-240 
0 

-2 975
102

Balance at 1 January 2004 

Remaining balance of Member States’ 
contributions for 2003 
Contributions for 2004 paid by Member 
States before 31 December 2003 

Member States’ contributions for 2004 

Interest/Other 

Stabex transfer 

Recoveries 

Payments 
Balance at 31 December 2004 

Member States’ contributions for 2005 

Interest/Other 

Recoveries 

Payments 

Balance at 31 December 2005 

revised  upwards 

Though  November’s  payment  estimates  have  been 
(by 
EUR 123 million), this increased volume can be implemented without increasing the 
financial contributions asked of the Member States (EUR 2 440 million). One reason 
for this is that the EIB ended 2003 with a relatively large cash surplus. This reduces 
the need for financial resources in 2004. Another reason is that the Commission has 
revised its cash balance at the end of 2004 downwards. This forecast suggests a cash 
balance  of  EUR 102 million,  compared  with  the  November 2003  estimate  of 
EUR 173 million. This sum of EUR 102 million includes a reserve of several tens of 
millions  of  euro  that  the  Commission  is  keeping  in  case  any  additional  needs  arise, 
e.g. under the Peace Facility, for which no provision has yet been made.  

Though the total level of contributions for 2004 is unchanged, the amount payable to 
the Commission has increased (from EUR 2 180 million to EUR 2 315 million) at the 
(EUR 125 million,  compared  with 
expense  of 
EUR 260 million). 

that  payable 

the  EIB 

to 

EN 

16 

   EN 

 
 
  
  
 
  
  
  
 
A  preliminary  forecast  of  contributions  for  2005  produces  a  figure  of  about 
EUR 2 900 million. The increase in (estimated) contributions over the period 2003 to 
2005  is  considerable  (2003:  EUR 2 200  million;  2004:  EUR 2 440  million;  2005: 
EUR 2 900 million) and reflects the improving performance of the EDF. 

2.6. 

Contributions to be paid by the Member States in the second and third tranches 
for 2004 

Under  Article 38  of  the  9th  EDF  Financial Regulation  -  assuming  all  parties  respect 
the  deadlines  - 
to 
21 November 2004.  

tranche  of  contributions  covers 

the  second 

the  period 

The  EIB  believes  it  has  sufficient  funds  to  cover  this  period  and  is  not  therefore 
seeking contributions from the second tranche.  

The Commission’s needs from the second tranche have, however, risen considerably. 
Going  by  the  Commission’s  past  payment  rates,  the  upward  revision  of  forecast 
payments  for  2004  (from  EUR 2 240 million  to  EUR 2 455 million)  and  the  needs 
communicated  by  the  EIB  for  the  old  EDF  instruments  (EUR 138 million),  the 
Commission is asking the Member States for EUR 1 100 million for the second 2004 
tranche.  In  total,  the  amount  of  the  second  call  payable  to  the  Commission  has 
increased by EUR 290 million. 

As for the final tranche, the EIB, on the basis of the information currently available to 
it, does not believe it will need funds. The Commission expects to need the balance of 
the EUR 2 315 million, namely EUR 490 million. The Commission and the EIB will 
reassess  the  situation  in  October  and,  if  need  be,  adjust  their  position  in  the  light  of 
developments.  

The following table summarises the position as set out in November’s communication 
and the revised figures. The table in Annex 2 sets out the amounts per Member State. 

Tranches of contributions paid or payable by the Member States to the EIB and 
the Commission in 2004 

EUR million 

PRO MEMORIA 
November 2003 communication 

REVISED FIGURES 

EIB 

Commission 

TOTAL 

EIB 

Commission 

TOTAL 

Tranche 1 
(already 
paid) 
Tranche 2 
(proposed) 
Tranche 3 
(estimated) 
Total 

125 

95 

40 

260 

725 

810 

645 

850 

125 

725 

850 

905 

685 

0 

0 

2 180 

2 440 

125 

1 100 

490 

2 315 

1 100 

490 

2 440 

EN 

17 

   EN 

 
 
 
 
 
 
  
 
  
  
 
  
ABBREVIATIONS AND ACRONYMS 

ACP............... African, Caribbean and Pacific States. 

CDE............... Centre for the Development of Enterprise 

CTA............... Technical Centre for Agricultural and Rural Development 

EDF ............... European Development Fund 

EIB ................ European Investment Bank 

HIPC.............. Highly indebted poor countries 

JPA ................ Joint Parliamentary Assembly 

NIP ................ National Indicative Programme 

OCT............... Overseas Countries and Territories 

RIP ................ Regional indicative programme 

TA ................. Technical assistance 

EN 

18 

   EN 

 
ANNEX I 
Consolidated figures for the EDFs for the ACP countries and OCTs at 31 December 2003 

I.- Previous EDFs (6th, 7th and 8th) 

Allocations 

Commitments 

Contracts 

Payments 

Situation at1 
April 2003 

Transfers since  
1 April 2003 

Total 

National/OCT indicative programmes 
National transitional measures 9th EDF 
Regional cooperation 
9th EDF regional (transitional measures) 
9th EDF intra-ACP (transitional measures) 
Interest-rate subsidies 
Risk capital 
Structural adjustment facility 
Emergency assistance 
Aid for refugees 
Stabex 
Sysmin 
Use of interest 
Transfers from the previous EDFs 
Debt relief 
General contingencies 

Miscellaneous revenue 

Total 

Total 

14.114.439.016 

-1.260.648.359 

12.853.790.656 

12.853.790.656 

10.757.900.768 

9.274.536.362 

1.200.000.000 

-392.791.000 

807.209.000 

807.209.000 

362.714.954 

199.874.808 

3.907.176.454 

-404.737.835 

3.502.438.618 

3.502.438.618 

2.881.431.453 

2.422.511.251 

25.000.000 

-16.500.000 

8.500.000 

8.500.000 

0 

0 

60.000.000 

0 

60.000.000 

60.000.000 

60.000.000 

60.000.000 

486.578.492 

-67.118.716 

419.459.776 

419.459.776 

419.459.776 

341.920.904 

2.790.000.000 

-182.924.338 

2.607.075.662 

2.607.075.662 

2.490.019.006 

1.993.819.150 

2.807.386.345 

-45.269.059 

2.762.117.286 

2.762.117.286 

2.668.892.141 

2.543.854.170 

730.223.839 

-3.246.857 

726.976.982 

726.976.982 

724.676.390 

718.128.267 

302.052.831 

-2.272.678 

299.780.154 

299.780.154 

280.004.284 

235.963.610 

3.824.093.431 

-5.620.519 

3.818.472.912 

3.818.472.912 

3.806.307.060 

3.615.325.526 

734.693.853 

-22.596.471 

712.097.382 

712.097.382 

584.270.832 

535.839.633 

38.150.000 

0 

38.150.000 

38.150.000 

26.782.367 

13.475.195 

539.340.669 

-94.813.225 

444.527.445 

444.527.445 

407.842.359 

380.424.723 

1.225.000.000 

-125.000.000 

1.100.000.000 

1.100.000.000 

1.100.000.000 

1.100.000.000 

28.396.985 

-28.396.985 

0 

0 

0 

0 

32.812.531.914 

-2.651.936.042 

30.160.595.872 

30.160.595.872 

26.570.301.389 

23.435.673.598 

32.177.989 

-32.177.989 

0 

32.844.709.904 

-2.684.114.032 

30.160.595.872 

30.160.595.872 

26.570.301.389 

23.435.673.598 

30.160.595.872 

30.160.595.872 

26.570.301.389 

23.435.673.598 

II.- 9th EDF 

Allocations 

Commitments 

Contracts 

Payments 

Situation at1 
April 2003 

Transfers since  
1 April 2003 

Total 

National/individual OCT allocations 
CDE, CTA and JPA 
Long-term development reserve 
Intra-ACP cooperation 
Other regional cooperation 
Reserve for regional cooperation 
Studies and TA for OCTs 
Cost of implementation 
Miscellaneous revenue 

8.650.300.000 

1.703.183.544 

10.353.483.544 

2.064.059.870 

592.904.290 

105.448.451 

164.000.000 

-99.101.000 

64.899.000 

37.878.000 

401.850.000 

-107.088.157 

294.761.843 

0 

0 

0 

0 

0 

300.000.000 

1.135.707.733 

1.435.707.733 

759.798.156 

374.378.870 

170.354.827 

651.000.000 

288.989.549 

939.989.549 

169.055.476 

7.489.677 

1.600.441 

261.000.000 

-261.000.000 

0 

0 

2.000.000 

125.000.000 

0 

0 

2.000.000 

652.157 

125.000.000 

125.000.000 

0 

32.216.776 

32.216.776 

0 

0 

449.926 

124.538 

0 

0 

251.356 

2.659 

0 

Total 

10.555.150.000 

2.692.908.445 

13.248.058.445 

3.156.443.659 

975.347.301 

277.657.734 

PM: Funds managed by the EIB 
- Interest-rate subsidies 
- Investment Facility 

187.850.000 

2.057.000.000 

Total for the 9th EDF 

12.800.000.000 

187.850.000 

2.057.000.000 

15.492.908.445 

EN 

19 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
III.- Consolidated position 

Allocations 

Commitments 

Contracts 

Payments 

Situation at 1 
April 2003 

Transfers since  
1 April 2003 

Total 

National/OCT allocations 
CDE, CTA and JPA 
Long-term development reserve 
Regional cooperation 
Interest-rate subsidies (6th to 8th EDFs) 
Risk capital (6th to 8th EDFs) 
Structural adjustment facility 
Emergency aid 
Aid for refugees 
Stabex 
Sysmin 
Use of interest 
Transfers from 1st to 5th EDFs 
Debt relief (7th and 8th EDFs) 
Studies and TA for OCTs 
General contingencies 
Cost of implementation 
Miscellaneous revenue 

23.964.739.016 

49.744.185 

24.014.483.200 

15.725.059.526 

11.713.520.012 

9.579.859.620 

164.000.000 

-99.101.000 

64.899.000 

37.878.000 

401.850.000 

-107.088.157 

294.761.843 

0 

0 

0 

0 

0 

5.204.176.454 

742.459.447 

5.946.635.900 

4.499.792.250 

3.323.300.000 

2.654.466.520 

486.578.492 

-67.118.716 

419.459.776 

419.459.776 

419.459.776 

341.920.904 

2.790.000.000 

-182.924.338 

2.607.075.662 

2.607.075.662 

2.490.019.006 

1.993.819.150 

2.807.386.345 

-45.269.059 

2.762.117.286 

2.762.117.286 

2.668.892.141 

2.543.854.170 

730.223.839 

-3.246.857 

726.976.982 

726.976.982 

724.676.390 

718.128.267 

302.052.831 

-2.272.678 

299.780.154 

299.780.154 

280.004.284 

235.963.610 

3.824.093.431 

-5.620.519 

3.818.472.912 

3.818.472.912 

3.806.307.060 

3.615.325.526 

734.693.853 

-22.596.471 

712.097.382 

712.097.382 

584.270.832 

535.839.633 

38.150.000 

0 

38.150.000 

38.150.000 

26.782.367 

13.475.195 

539.340.669 

-94.813.225 

444.527.445 

444.527.445 

407.842.359 

380.424.723 

1.225.000.000 

-125.000.000 

1.100.000.000 

1.100.000.000 

1.100.000.000 

1.100.000.000 

2.000.000 

0 

2.000.000 

652.157 

449.926 

251.356 

28.396.985 

-28.396.985 

0 

0 

0 

125.000.000 

0 

125.000.000 

125.000.000 

124.538 

32.177.989 

38.787 

32.216.776 

0 

0 

0 

2.659 

0 

Total 

43.399.859.904 

8.794.413(*) 

33.317.039.530 
(*): The net increase of EUR 8 794 413 results from interest. 

43.408.654.317 

27.545.648.689 

23.713.331.332 

PM: Funds managed by the EIB 

- Interest-rate subsidies 
- Investment Facility 

187.850.000 

2.057.000.000 

187.850.000 

2.057.000.000 

Total for the 6th, 7th, 8th and 9th EDFs 

45.644.709.904 

45.653.504.317 

EN 

20 

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ANNEX 2 

CONTRIBUTIONS TO THE EDF FOR 2004 (in euro) 

COUNTRY 

SCALE 

1st tranche 

2nd tranche 

3rd tranche 

TOTAL 

8th EDF 

% 

paid to 
EIB 

paid to 
Commission 

23,36 

29.200.000 169.360.000 

3,92 

2,14 

5,84 

4.900.000

28.420.000

2.675.000

15.515.000

7.300.000

42.340.000

24,30 

30.375.000

176.175.000

1,25 

0,62 

1.562.500

9.062.500

775.000

4.495.000

12,54 

15.675.000

90.915.000

0,29 

362.500

2.102.500

GERMANY 
BELGIUM 
DENMARK 
SPAIN 
FRANCE 
GREECE 
IRELAND 
ITALY 
LUXEMBOURG 

payable 
to 
EIB 

payable to 
Commission 

payable to 
EIB 

payable to 
Commission 

0

0

0

0

0

0

0

0

0

256.960.000

43.120.000

23.540.000

64.240.000

267.300.000

13.750.000

6.820.000

137.940.000

3.190.000

0

0

0

0

0

0

0

0

0

114.464.000

569.984.000

19.208.000

95.648.000

10.486.000

52.216.000

28.616.000

142.496.000

119.070.000

592.920.000

6.125.000

3.038.000

30.500.000

15.128.000

61.446.000

305.976.000

1.421.000

7.076.000

EN 

21 
EN 

 
 
 
 
  
 
  
 
NETHERLANDS
PORTUGAL 
UK 
AUSTRIA 
FINLAND 
SWEDEN 
TOTAL 

5,22 

0,97 

6.525.000

37.845.000

1.212.500

7.032.500

12,69 

15.862.500

92.002.500

2,65 

1,48 

2,73 

100,00 

3.312.500

19.212.500

1.850.000

10.730.000

3.412.500
125.000.00
018

19.792.500

725.000.000

0

0

0

0

0

0

0

57.420.000

10.670.000

139.590.000

29.150.000

16.280.000

30.030.000

1.100.000.000

0

0

0

0

0

0

0

25.578.000

127.368.000

4.753.000

23.668.000

62.181.000

309.636.000

12.985.000

64.660.000

7.252.000

36.112.000

13.377.000

66.612.000

490.000.000

2.440.000.000

18 

Including EUR 5 million in interest-rate subsidies. 

EN 

22 
EN