Communication from the Commission to the Council and the European Parliament - Financial Information on the European Development Funds
Date: 2007-06-13
Institutions: European Commission
Subjects: European Development Fund, commitment of expenditure, financial management, information, payment appropriation

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 13.6.2007 
COM(2007) 326 final 

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND THE 
EUROPEAN PARLIAMENT 

Financial Information on the European Development Funds 

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COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND THE 
EUROPEAN PARLIAMENT 

Financial Information on the European Development Funds 

FOREWORD 

This  document  is  to  be  annexed  to  the  draft  budget  for  2008,  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 Fund (EDF)1 requires the Commission to make this document available to the 
Council by 15 June, stipulating that this information serve as the basis for an interim estimate 
of commitments and payments. 

As in previous years, this document sets out: 

–  implementation of the EDFs (6th to 9th) at 31.12.2006; 

–  financial implementation forecasts for the current year; 

–  expenditure forecasts for 2008. 

The Member States contribute funds directly to the European Investment Bank (EIB) for the 
instruments  which  it  manages  under  the  9th  EDF  (the  Investment  Facility  and  interest-rate 
subsidies). Contributions for other instruments, including contributions for the old instruments 
managed by the EIB (risk capital and interest-rate subsidies), go through the Commission. 

Unless otherwise indicated, all the commitments and payments listed in this Communication 
are  gross  amounts,  i.e.  no  decommitments  or  recoveries  have  been  deducted.  This  is  in 
keeping with the approach adopted for the European Union’s general budget.  

1 

OJ L 83, 1.4.2003, p. 1. 

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INTRODUCTION 

The Commission and the EIB have updated their commitment and payment forecasts 
for  2007  and  2008  for  each  of  the  ACP  countries2  and  the  OCTs3.  The  payment 
forecasts in particular have been compiled with great care with the aim of helping the 
Member States to assess as accurately as possible the amounts they need to earmark 
in  their  national  budgets  while  ensuring  that  sufficient  financial  resources  are 
available for the EDF to avoid liquidity problems. In accordance with Article 8 of the 
Financial Regulation applicable to the 9th EDF4, these forecasts will be adjusted in 
the October 2007 Communication.  

In line with the joint statement made when adopting the Financial Regulation for the 
9th EDF, this document consists mainly of tables accompanied by a few explanations 
to help interpretation. 

The graph below shows the general trend in commitments and payments, including 
projections for 2007-2008 (Commission and EIB): it clearly illustrates the upwards 
structural trend in payments since 2000. 

5.000

4.000

3.000

2.000

1.000

0

 €

m

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

332
118

1.950
352

2.380
807

1.363
1.265

953
1.257

1.433
1.191

2.236
1.984

1.843
1.443

2.689
1.860

1.874
1.758

1.538
1.509

784
1.382

2.606
1.595

2.958
1.352

4.007
1.640

1.927
1.779

2.125
1.922

4.107
2.349

2.972
2.558

4.020
2.704

4.037
3.062

3.877
3.496

3.400
3.772

- - Commitments; ―Payments 

2 
3 
4 

African, Caribbean and Pacific States. 
Overseas Countries and Territories. 
OJ L 83, 1.4.2003, p. 1. 

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1. 

IMPLEMENTATION OF THE EUROPEAN DEVELOPMENT FUNDS AT 31 DECEMBER 2006 

1.1. 

Funds available at 31 December 2006 

Annex 1 gives an overview of the funds available to the Commission and EIB under 
the EDFs (6th to 9th), commitments and payments at the end of 2006. Of the amount 
not  committed  (EUR 3 607 million),  EUR 3 163 million  fall  within  the  remit  of  the 
Commission and will be committed by the end of 2007. 

Unlike the figures in the rest of this document, the figures given above and in Annex 1 
are “net” figures. They are obtained after deduction of decommitments and recoveries. 
This is necessary to determine the amount of available funds. 

1.2. 

Implementation of the EDFs in 2006 (commitments and payments) 

Annex  2  gives  a  breakdown  of  commitments  and  payments  by  instrument  and 
compares them with the 2005 figures. 

Annex 3  shows  actual  implementation  in  2006  compared  with  the  forecasts  made  in 
October  2006.  The  two  institutions  met  their  targets.  Note  that  the  Commission's 
objectives had hardly changed since October 2005.  

1.3. 

Calls for contributions in 2006 

Annex  4  shows  the  financial  situation  and  projections  The  table  does  not  include 
payments  made  under  Stabex  or  payments  for  special  measures  for  the  Democratic 
Republic  of  Congo.  This  expenditure  was  made  from  separate  accounts  which  had 
already been credited by the Member States.  

The cash balance available to the Commission at the end of 2006 was approximately 
EUR 131 million5,  more  than  expected  (EUR 74 million).  However,  at  31 December 
2006, a high volume of payments (some EUR 110 million) had been initiated, against 
this 
EUR 23 million 
EUR 131 million to cover the period between 1 and 27 January when the first tranche 
of the 2007 contributions was scheduled.  

the  Commission  needed  all  of 

the  year  before.  And 

2. 

FINANCIAL IMPLEMENTATION FORECASTS FOR 2007 AND 2008 

The new forecasts are set out in Annex 3.  

Note that:  

(1) 

2007 payments have been revised markedly upwards for both the Commission 
and the EIB.  

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Excluding EUR 3.5 million in 2007 contributions paid in at the end of December 2006. 

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(a) 

For the Commission the increase is attributable to: 

– 

– 

the beneficial impact of devolution: following the completion of 
this  process  in  2005  there  was  a  greater  than  forecast 
speeding-up  of  contract  awards  in  2006  (20%  up  on  2005), 
which  led  to  a  greater  volume  of  payments  than  forecast  in 
2007; 

the end-of-term review of the 9th EDF and decisions to reassign 
resources, which should lead to additional payments as early as 
this year (for the Peace Facility); 

– 

better than expected progress in certain "risky"countries.  

(b) 

The EIB has also made faster progress than expected. This is because a 
number of projects approved since 2003 are now becoming operational 
and there was a marked increase in the loans agreed in 2006, especially 
for the private sector. 

(2) 

Since 2008 will see the start to implementation of a new EDF the forecasts are 
inevitably less reliable than usual. This is particularly true of commitments, for 
which  the  estimate  is  purely  speculative  at  present.  The  figures  are  based  on 
the assumption that the 10th EDF will enter into force on 1 January 2008. 

3. 

FINANCIAL SITUATION FORECAST FOR 2007 AND 2008 

The new forecasts are set out in Annex 4, which calls for the following comments: 

•  To  meet  the  rise  in  forecast  payments  in  2007  the  EIB  asked  for  an  additional 
contribution of EUR 80 million in May this year. As this proposal was rejected by 
the  Council,  the  amount  has  been  integrated  in  the  proposal  on  the  second 
instalment. The amount of the third tranche forecast in October 2006 is confirmed 
for the present;  

•  Contributions  for  the  Commission  should  rise  from  EUR 2 640  million  to 
EUR 2 935 million. The Commission proposes a slightly higher second tranche of 
EUR 1 050 million,  EUR 200 million  more  than  estimated  in  October.  According 
to current estimates the third tranche will be in the order of EUR 385 million.  

•  A  preliminary  estimate  of  the  contributions  required  for  2008  gives  a  figure  of 

EUR 3 672 million. 

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Annex 1: Consolidated situation of the EDFs (6th to 9th) for the ACP countries and 
OCTs at 31 December 2006 (EUR million) 

COMMISSION 
National and Local programmes 
Interest-rate subsidies 
Risk capital (6th to 8th EDFs) 
Structural adjustment facility 
Emergency aid 
Aid for refugees 
Stabex 
Sysmin 
Debt relief (EDFs 7 and 8) 
Use of interest 
Transfers from 4th and 5th EDFs 
Subtotal - Lomé 
Envelope A 
Envelope B 
Regional allocation 
Intra-ACP allocation 

CDE6, CTA7 and JPA8 

Studies and TA9 for OCTs 

Implementation expenditure 
DRC special assistance 
Miscellaneous revenue 
Transfer 6th EDF 
Reserves 
Subtotal Cotonou 
Total for the Commission 
EIB 
Interest-rate subsidies 
Investment Facility 
Total for the EIB 
Conditional billion 
GRAND TOTAL (6th to 9th EDFs) 

Allocations  Commitments Payments 

15 607
382
2 514
2 669
722
296
3 871
685
1 100
37
411
28 296
9 824
1 734
980
2 902

141

2

125
108
76
37
384
16 313
44 609

188
2 057
2245

15 607
382
2 514
2 669
722
296
3 871
685
1 100
37
411
28 296
8 304
1 314
741
2 390

109

2

117
108
28
36

13 150
41 446

95
1 706
1 801

14 143 
353 
2 261 
2 651 
722 
278 
3 667 
594 
1 100 
32 
399 
26 199 
3 078 
542 
85 
944 

92 

0 

111 
105 
4 
4 

4 966 
31 165 

91 
402 
493 

1  

46 854

43 247

31 658 

The figures in this table are net figures, i.e. after de-commitments and recoveries. 

6 
7 
8 
9 

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

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Annex 2 

Breakdown of expenditure by instrument for the years 2005 and 2006 

EUR million 

2005 

2006 

Commitment
s 

Payments  Commitment

s 

Payments 

COMMISSION 

6th to 8th EDFs 
Indicative Programmes  
Outside indicative programmes 
Interest-rate subsidies 
Emergency aid 
Aid for refugees 
Risk capital 
Mining products 
Stabex 
Structural adjustment facility 
Unexpended balances (4th + 5th 
EDFs) 
Implementation expenditure 
Subtotal 

9th EDF + transitional measures 
Envelope A 
Envelope B 
Regional projects 
Intra-ACP Cotonou projects 
Implementation expenditure  
DRC 
Unexpended balances 6th EDF 
Other 
Subtotal 

-

-
-
-
-
-
8.8
-

-

-
8.8

2 806.3
288.0
217.2
143.0
7.3 
0.0

40.5
3 502.3

887.7

- 

612.0

0.4
1.9
9.4
60.8
15.0
70.8
15.9

5.6

1.9
1 069.4

950.5
192.8
23.8
131.5
54.0
89.2

33.2
1 475.0

- 
- 
- 
- 
- 
9.1 
- 

- 

- 
9.1 

1 744.1 
353.7 
222.8 
1 037.0 
21.0 
16.2 

4.0 
3 398.7 

1.6
0.3
8.0
63.1
16.0
189.5
1.1

1.1

0.7
893.2

1 240.9
154.0
49.6
431.2
5.9
15.9
4.5
31.0
1 933.0

Total managed by Commission 

3 511.1

2 544.3

3 407.9 

2 826.2

EIB (9th EDF) 

Investment Facility + interest-rate 
subsidies 
EDF TOTAL 

508.8

159.5

628.8 

236.0

4 019.9

2 703.8

4 036.7 

3 062.2

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Annex 3: Commitments and payments made in 2006 and forecast for 2007 and 2008 (EUR million) 

2006 

2007 

2008 

Communication 
Oct 06 

Outturn 

Communica
tion 
Oct 06 

Revised 

Communicat
ion 
Oct 06 

Revised 

Regions 

 East Africa 
West Africa 
Central Africa 
Caribbean 
Pacific 
South Africa 
Subtotal 

Other 

Peace Facility 
Water Facility 
Debt relief (HIPC)  
Other 

Total for the Commission 

Investment Facility 
Interest-rate subsidies 

Total for EIB instruments (9th EDF) 
TOTAL 

843
709
441
236
50
342
2 621

50
185
0
544
3 400
582
40
622
4 022

590
595
558
286
22
298
2 349

50
216
0
792
3 408
576
53
629
4 037

680
715
285
241
158
365
2 444

0
86
0
920
3 450
325
90
415
3 865

703
770
293
239
150
351
2 506

80
172
0
692
3 450
350
77
427
3 877

2 900

587
3 487

2 900
450
50
500
3 400

* Taking account of the updated figures notified by the EIB at the discussions in the Council in November 2006. 

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Annex 3 (cont'd): Payments made in 2006 and forecast for 2007 and 2008 (EUR million) 

Regions 

East Africa 
West Africa 
Central Africa 
Caribbean 
Pacific 
South Africa 
All regions 6th, 7th and 8th EDFs 
Subtotal 

Other 

Peace Facility 
Water Facility 
Risk capital (**)  
Debt relief (HIPC) 
Other 
SUBTOTAL 
Stabex 
DR Congo 

Total for the Commission 

Investment Facility 
Interest-rate subsidies 

2006 

2007 

2008 

Communication
Oct 06 

In 
practice 

Communication 
Oct 06 

Revised 

Communication
Oct 06 

Revised 

514
710
301
209
77
354
-
2 165

554
605
297
185
54
386
126
2 207

418 
763 
240 
190 
68 
354 
- 
2 033 

658
837
304
264
76
398
-
2 535

672
904
411
306
80
412
-
2 785

124
69
75
60
157
2 650
100
0
2 750
195
30
225
2 975

110
42
63
80
119
2 621
190
16
2 826
188
48
236
3 062

12 
107 
71 
100 
384 
2 707 
127 
16 
2 850 
250 
50 
300 
3 150 

75
62
72
100
220
3 064
72
0
3 136
330
30
360
3 496

18
159
72
100
139
3 273
27
0
3 300
400
72
472
3772

3 200

Total for EIB instruments (9th EDF) 
TOTAL 
*  Taking  account  of  the  updated  figures  notified  by  the  EIB  at  the  discussions  in  the  Council  in  November  2006.  **Including  interest-rate 
subsidies. 

430
3 630

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Annex 4: Financial Situation in 2006 and forecast for 2007 and 2008 – excluding Stabex and Special RDC Account(***) (EUR million) 

Balance at 31.12.2005 
2005 contributions paid in 2006 
2006 contributions, of which: 

6
0
0
2

First tranche 
Second tranche 
Third tranche 

Recoveries, interest and other  
Payments 
Balance at 31.12.2006 
  2007 contributions, of which: 
First tranche 
Second tranche 
Third tranche 

7
0
0
2

8
0
0
2

Recoveries, interest and other 
Payments 
Balance at 31.12.2007 
2008 contributions 
Recoveries, interest and other 
Payments 
Balance at 31.12.2008 

Communication Oct 2006 

Commission 

138* 
14 
2 510 
1 400 
910 
200 
62 
-2 650 
74 
2 640 
1 500 
850 
290 
72 
-2 707 
79 

EIB 
9th EDF 
142 

160 
60 
100 

-225 
77 
225 
70 
110 
45 

-300 
2 

TOTAL 

Commission 

280 
14 
2 670 
1 460 
1 .010 
200 
62 
-2 875 
151 
2 865 
1 570 
960 
335 
72 
-3 007 
81 

138* 
14 
2 510 
1 400 
910 
200 
90 
-2 621 
131** 
2 935 
1 500 
1 050 
385 
75 
-3 064 
77 
3 200 
75 
-3 273 
79 

Revised 
EIB 
9th EDF 
138 

160 
60 
100 

-236 
62 
305 
70 
190 
45 

-360 
7 
472 

-472 
7 

TOTAL 

276 
14 
2 670 
1 4600 
1 0100 
200 
90 
-2 857 
193 
3 240 
1 570 
1 240 
430 
75 
-3 424 
84 
3 672 
75 
-3 745 
86 

* Excluding EUR 1.4 million in 2006 contributions. 
** Excluding EUR 3.5 million in 2007 contributions. 
***Funds available for operations. 

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SCA
LE 

% 

paid 
EIB 

23.36  16 352 000

3.92 

2.14 

5.84 

2 744 000

1 498 000

4 088 000

Annex 5: Contributions to the EDF for 2007 (euro) 

1st tranche 

2nd tranche 

3rd tranche 

TOTAL 

paid 
Commission 
350 400 000

58 800 000

32 100 000

payable to  
EIB 
44.384.000

7.448.000

4.066.000

payable to 
Commission 
245 280 000  10 512 000

payable to 
EIB 

payable to 
Commission 
89 936 000

for all  
tranches 
756 864 000

41 160 000 

1 764 000

15 092 000

127 008 000

22 470 000 

963 000

8 239 000

69 336 000

87 600 000

11.096.000

61 320 000 

2 628 000

22 484 000

189 216 000

24.30  17 010 000

364 500 000

46.170.000

255 150 000  10 935 000

93 555 000

787 320 000

1.25 

0.62 

875 000

434 000

18 750 000

9 300 000

2.375.000

1.178.000

13 125 000 

6 510 000 

562 500

279 000

4 812 500

2 387 000

40 500 000

20 088 000

12.54 

8 778 000

188 100 000

23.826.000

131 670 000 

5 643 000

48 279 000

406 296 000

0.29 

5.22 

0.97 

12.69 
2.65 

1.48 

2.73 
100.0
0 

203 000

3 654 000

679 000

8 883 000
1 855 000

1 036 000

1 911 000

4 350 000

78 300 000

14 550 000

190 350 000
39 750 000

22 200 000

40 950 000

551.000

9.918.000

1.843.000

24.111.000
5.035.000

2.812.000

5.187.000

3 045 000 

130 500

1 116 500

9 396 000

54 810 000 

2 349 000

20 097 000

169 128 000

10 185 000 

436 500

3 734 500

31 428 000

133 245 000 
27 825 000 

5 710 500
1 192 500

48 856 500
10 202 500

15 540 000 

666 000

5 698 000

28 665 000 

1 228 500

10 510 500

411 156 000
85 860 000

47 952 000

88 452 000

70 000 000

1 500 000 000

190.000.000

1 050 000 000  45 000 000

385 000 000

3 240 000 000

COUNTRY 

GERMANY 
BELGIUM 
DENMARK 
SPAIN 
FRANCE 
GREECE 
IRELAND 
ITALY 
LUXEMBOURG 
NETHERLANDS 
PORTUGAL 
UNITED 
KINGDOM 
AUSTRIA 
FINLAND 
SWEDEN 

TOTAL 

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