Communication from the Commission to the Council and the European Parliament - Annual Report 2007 on the European Community’s Development Policy and the Implementation of External Assistance in 2006 {SEC(2007) 840}
Date: 2007-06-21
Institutions: European Commission
Subjects: activity report, aid evaluation, aid policy, cooperation policy, developing countries, development aid

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 21.6.2007 
COM(2007) 349 final 

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND THE 
EUROPEAN PARLIAMENT 

Annual Report 2007 on the European Community’s Development Policy and the 
Implementation of External Assistance in 2006 

{SEC(2007) 840} 

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   EN 

 
 
 
  
COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND THE 
EUROPEAN PARLIAMENT 

Annual Report 2007 on the European Community’s Development Policy and the 
Implementation of External Assistance in 2006 

TABLE OF CONTENTS 

1. 

2. 

3. 

4. 

5. 

6. 

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

A better framework for development policy: policy coherence................................... 3 

A better framework for regional strategies .................................................................. 4 

A better framework for external assistance – simplifying and clarifying regulations . 5 

A better framework for working together: aid effectiveness ....................................... 8 

Results .......................................................................................................................... 9 

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1. 

INTRODUCTION 

The European Union continues to be the world's major source of development aid, providing 
€ 46.9 billion (56.67%) of total official development assistance (ODA) reported to the OECD 
for 2006. The external aid managed by the European Commission amounted to about € 12.1 
billion of new commitments in 2006, of which € 9.8 billion is classified as ODA. Over 160 
countries benefit from this aid.  

2006 saw major changes in the way the EU manages its relations with the rest of the world. 
First, by ensuring that policies which affect developing countries can support the objectives of 
development; second, by adopting regional strategies that reflect its main priorities; third, by 
simplifying  the  range  of  instruments  that  provide  the  legal  basis  for  external  assistance; 
fourth,  by  implementing  measures  to  work  more  closely  with  partner  countries  and  other 
development  actors  so  that  aid  becomes  more  effective;  and  last,  by  improving  the  ways  in 
which results are measured and lessons learnt.  

This overview aims to present the main features of each of these changes. 

2. 

A BETTER FRAMEWORK FOR DEVELOPMENT POLICY: POLICY COHERENCE 

Since  the  adoption  in  December  2005  of  the  European  Consensus  on  Development,  the 
Commission has increasingly focused on the contribution that policies beyond development – 
such  as  trade,  agriculture,  environment,  security,  migration,  the  social  dimension  of 
globalisation,  employment  and  decent  work,  and  international  scientific  co-operation, 
including  health  research  -  can  make  to  achieving  the  Millennium  Development  Goals 
(MDGs). 

It is widely agreed that development policy alone will not bring sufficient results and that a 
number of other policies can have a major impact. The EU's aim is to maximise the positive 
effect of its policies while minimising their negative impact on developing countries.  

Under the impetus of the EU Presidency, a rolling work programme for 2006-2007 on Policy 
Coherence for Development (PCD) was elaborated to identify common priorities for action. 
In October 2006, the Council adopted conclusions covering both the Presidency's rolling PCD 
work  programme  and  the  integration  of  development  concerns  in  the  Council's  decision-
making processes. The Commission has made progress in a number of areas, including trade, 
and in particular in the negotiation of Economic Partnership Agreements with ACP countries 
that aim at fostering trade and regional integration as an engine for long-term development. 
The fight against infectious diseases linked to poverty is another good example, e.g. through 
the European and Developing Countries Clinical Trials Partnership (EDCTP).  

Considerable progress has also been made in the area of migration, within the framework of 
the EU Strategy for Africa1 and with the launch of a € 380 million Thematic Programme for 
Migration for 2007-2013 and, further, in the area of security, with support for security sector 
reform in partner countries. Migration is a topic for which coherence is particularly important. 
In the framework of its broader co-operation agreements, the EU has developed a dialogue on 

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EU Strategy for Africa: Towards a Euro-African pact to accelerate Africa's development. COM(2005) 
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migration-related  issues  with  various  countries  and  regions  in  the  world.  The  European 
Neighbourhood  Policy  is  a  case  in  point,  and  other  dialogue  processes  are  underway  with 
partners in Africa, Asia, Latin America and the Caribbean2.  

Such a dialogue typically covers a broad range of issues, including for example the linkages 
between  migration  and  development,  the  fight  against  illegal  migration  and  trafficking  in 
human beings, the impact of refugee situations on development, and joint efforts to manage 
economic  migration  better.  It  can  lead  to  the  provision  of  EU  assistance  to  help  partner 
countries  build  their  capacity  to  manage  migration  flows  and  to  maximise  the  positive 
linkages between migration and development. 

Also  in  the  context  of  coherence,  questions  of  human  rights  and  good  governance  are 
addressed  systematically.  In  2006  for  instance,  13  EU  Election  Observation  Missions  were 
mobilised  and  some  1  400  EU  observers  deployed.  These  missions  contributed  by  their 
presence to reducing the possibility of fraud, manipulation and intimidation. They increased 
transparency  and  public  confidence  in  the  election  process,  and  thus  supported  progress  in 
democracy and governance. In some cases, the missions played a role in conflict prevention, 
as in the Democratic Republic of Congo (DRC), where the most important EU Mission ever 
deployed (300 observers) monitored the two rounds of elections in July and November. These 
elections  paved  the  way  for  a  return  to  civil  peace,  re-establishment  of  governance, 
sustainable development in the DRC and the stabilisation of the whole Great Lakes region. 

On governance, the Commission proposed a new approach to "Governance in the European 
Consensus  on  Development"3.  This  builds  on  a  major  evaluation  covering  the  period  1994-
2004.  The  EU,  it  found,  has  made  the  right  choice  in  putting  governance  at  the  top  of  its 
political  and  co-operation  agenda,  and  the  Commission  has  made  substantial  progress  in 
defining what are likely to be the most effective approaches to sustainable improvements. The 
Commission also stresses the importance of promoting good governance in areas such as the 
tax, financial and judicial area, and scientific co-operation. 

As  a  whole,  coherence  is  of  crucial  importance  for  implementing  EU  external  assistance 
policies. When dealing with partner countries, the Commission adopts three main identities – 
political player, development agency and donor administration – and is continuously seeking 
ways in which it can more effectively combine these three.  

3. 

A BETTER FRAMEWORK FOR REGIONAL STRATEGIES 

Also in line with the Consensus, the Commission has focused on ensuring its objectives and 
principles are reflected in the strategies for intervention at the regional level.  

In particular, the EU Strategy for Africa is the first application of the Consensus and the first 
integrated European political framework to improve co-ordination and coherence of EU and 
Member State policies and instruments. The importance attached to Africa was illustrated by 
the implementation of this strategy and by the EU's commitment to work on a Joint EU-Africa 
Strategy to be adopted at the second EU-Africa Summit in the second half of 2007 in Lisbon. 
A  further  illustration  was  the  joint  working  session  between  the  European  Commission  and 
the Commission of the African Union, which saw a team of European Commissioners led by 

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A parallel dialogue is also underway with the ACP (African, Caribbean and Pacific) grouping as such. 
COM(2006)421 of 30.8.2006 

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President  José  Manuel  Barroso  meet  the  African  Union  Commission  in  its  headquarters  in 
Addis Ababa.  

Strategies  for  the  European  Union's  relations  with  other  regions  have  also  drawn  upon  the 
Consensus  to  promote  a  consistent  view  of  the  world,  while  recognising  the  need  for 
differentiation. 2006 has been an effective year in building a strategic partnership between the 
EU and Latin America, with two main priorities for co-operation: to increase social cohesion 
and to promote regional integration.  

The  EU  is  also  building  a  strategic  framework  for  EU-Asia  relations  based  on  stronger 
political  dialogue,  enhanced  trade  and  a  sustained  level  of  development  co-operation.  The 
Union's  relations  with  the  two  major  countries  of  the  region,  China  and  India, are  being 
developed within the framework of strategic partnerships. The scope of these partnerships is 
comprehensive, covering both economic co-operation and the political aspects.  

The European Neighbourhood Policy (ENP) also gathered pace. The ENP is amongst the top 
priorities of the EU's external relations. Through this policy, the EU seeks to promote good 
governance and economic development in its vicinity. During the first eighteen months of its 
implementation,  the  policy  has  laid  a  substantial  foundation  for  strengthened  relations 
between  the  Union  and  its  neighbours.  On  4  December  2006,  the  Commission  set  out  new 
proposals to strengthen and develop the ENP further. These foresee offering partner countries 
improved  trade  and  investment  prospects,  making  people-to-people  contacts  and  legitimate 
short-term travel easier, being more active in addressing frozen conflicts, and opening more 
possibilities for mobilising funding.  

Through its enlargement policy and the Stabilisation and Association Process, the EU assists 
countries  with  a  perspective  of  membership  to  integrate  into  the  Union  gradually.  In  2006, 
this  policy  covered  Bulgaria,  Romania,  the  Western  Balkan  countries  and  Turkey.  Bulgaria 
and Romania joined the Union on 1 January 2007. Accession negotiations have been ongoing 
with Croatia and Turkey, while the other Western Balkan countries all made progress along 
the  “road  map”  set  out  within  the  Stabilisation  and  Association  process.  In  2006,  the 
Commission  established  firm  measures  to  reinforce  the  EU  policy  for  the  Western  Balkans 
and  its  instruments,  in  particular  for  rendering  the  EU  perspective  more  tangible  to  the 
citizens of that region. 

4. 

A  BETTER  FRAMEWORK  FOR  EXTERNAL  ASSISTANCE  –  SIMPLIFYING  AND 
CLARIFYING REGULATIONS 

External assistance policies have been integrated into the drafting of new instruments which 
form part of a complete overhaul of the structure of EU external co-operation. In 2006 these 
new  instruments,  setting  out  a  simplified  framework  for  delivering  assistance  during  the 
period  2007-2013,  were  finalised.  They  provide  a  consistent  basis  for  action,  bringing 
together clear policy objectives with the procedures and instruments needed to achieve them. 
Nine  financing  instruments  replace  the  existing  range  of  geographical  and  thematic 
regulations.  

Six instruments will support specific policies with a geographical or thematic focus: 

- the Instrument for Pre-accession Assistance (IPA);  

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- the European Neighbourhood and Partnership Instrument (ENPI);  

- the Instrument for Development Co-operation (DCI); 

- the Instrument for Co-operation with Industrialised Countries (ICI);  

- the European Instrument for Democracy and Human Rights (EIDHR);  

- the Instrument for Nuclear Safety Co-operation (INSC).  

Three instruments will address crisis situations:  

- the Instrument for Stability (IfS); 

-existing humanitarian aid, which will incorporate emergency food aid under the new 
financial perspectives; 

- the macro-financial assistance instruments. 

Co-operation will be implemented through country, regional and thematic strategy papers and 
multi-annual indicative programmes, as well as annual action programmes, which are subject 
to the new democratic scrutiny procedure established under the Inter-institutional Agreement. 
This  procedure  foresees  that  the  Commission  will  systematically  inform  and  consult  the 
European Parliament and the Council by sending draft strategy papers. The Commission has 
undertaken  to  enter  into  a  regular  dialogue  with  the  European  Parliament  on  these  strategy 
papers and to take due account of the position of the European Parliament when implementing 
strategies.  

The funds available under the Instrument for Development Co-operation (DCI) amount to € 
10.1 billion for developing countries from Latin America, Asia and the Middle East, and for 
South  Africa.  Apart  from  geographical  co-operation,  the  DCI  also  contains  thematic 
programmes which replace the existing thematic regulations. 

In January 2006, the Commission adopted a Communication entitled "Investing in People”4 
on  the  thematic  programme  for  human  and  social  development.  The  DCI  will  provide  just 
over  €  1  billion  for  this  programme  to  support  actions  in  areas  that  directly  affect  people's 
living standards and wellbeing, with a focus on the poorest and least developed countries and 
the  most  disadvantaged  sections  of  the  population.  On  this  basis,  a  strategy  to  support 
activities  under  four  main  pillars  –  Good  Health  for  All,  Education,  Knowledge  and  Skills, 
Gender  Equality  and  Other  Aspects  of  Social  and  Human  Development  (including  social 
cohesion,  employment,  decent  work,  children  and  youth,  and  culture)  –  has  been  prepared. 
This is a good example of the integrated approach the Commission seeks to promote.  

The protection of children and young people, and promotion of the participation of children 
and  young  people  in  development,  are  priority  areas  to  be  addressed  in  the  DCI  thematic 
programme “Investing in People”, as well as the new instrument for democracy and human 
rights. Until the new simplified instruments were introduced, the Commission used around 75 
different instruments related to children policies and programmes, both within and outside the 
borders  of  the  EU.  In  order  to  improve  coherence,  maximise  synergies,  explore  gaps  and 

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increase  the  instruments'  collective  impact  in  improving  the  rights  of  children,  the 
Commission adopted the Communication "Towards a strategy on the rights of the child” on 4 
July 2006.  

This  Communication  defines  a  long-term  and  in-depth  process  increasing  the  impact  of  EU 
actions  in  favour  of  children.  It  also  proposes  new  mechanisms  to  ensure  internal  co-
ordination  and  consultation  (such  as  a  European  Forum  for  the  Rights  of  the  Child)  and 
includes  prescriptions  for  the  effective  participation  of  children  themselves.  One  of  the 
commitments  of  the  Communication  is  to  develop  an  Action  Plan  on  Children  in 
Development Co-operation. 

For 2007-13, the budget foreseen for Neighbourhood countries, within the framework of the 
European  Neighbourhood  and  Partnership  Instrument,  is  approximately  €  12  billion,  32% 
more in real terms than in the previous budget period. In order to maximise the impact and 
leverage of this EU funding, the Commission has proposed, within the ENPI, the creation of 
two new mechanisms, namely:  

- a Neighbourhood Investment Fund, to which Member States will also be invited to 
contribute and which will be used to leverage additional lending from the European 
Investment  Bank,  the  European  Bank  for  Reconstruction  and  Development,  and 
other development banks. The contribution from the budget would be € 700 million. 
It is estimated that this fund could encourage lending of several times the amount of 
grant  funding.  If  Member  States  were  to  match  the  Commission  contribution,  the 
Fund could generate a considerable amount of concessional lending;  

-  a  Governance  Facility  of  €  300  million  to  provide  additional  support,  on  top  of 
normal  country  allocations,  to  acknowledge  and  support  the  work  of  partner 
countries that have made most progress in implementing their Action Plans.  

The  ENPI  also  has  a  specific  cross-border  co-operation  component,  cofinanced  by  the 
European  Regional  Development  Fund.  The  new  provisions  have  been  designed  to  address 
past shortcomings and to make this type of co-operation easier and more effective. 

The  programming  for  Asian,  Latin  American  and  neighbouring  countries  was  almost 
completed  and  an  informal  dialogue  between  institutions  was  launched  on  ENPI  and  DCI 
draft  strategies,  following  political  agreement  on  the  instruments,  so  as  to  slow  down  the 
delivery  of  assistance  in  2007  as  little  as  possible.  With  the  formal  entry  into  force  of  all 
instruments, the dialogue will continue in 2007 for these strategies, with democratic scrutiny 
by  the  European  Parliament.  A  set  of  detailed  Communications,  defining  the  approach  and 
contents  of  each  thematic  programme,  was  approved  in  January.  This  was  followed  by  a 
detailed programming process for each thematic programme, a process that will be completed 
in early-2007 to allow implementation soon thereafter. 

The  co-operation  with  the  African,  Caribbean  and  Pacific  (ACP)  countries  is  still  primarily 
funded  under  the  European  Development  Fund  (EDF),  as  the  European  Council  decided  in 
December 2005 that the EDF should continue to be financed separately from the budget. With 
€ 22.7 billion worth of funding, the 10th EDF (2008-2013) sets the basis for co-operation with 
the ACP countries. 

Programming guidelines for the 10th EDF have been prepared on the basis of the Consensus, 
including  the  definition  of  areas  of  Community  action  and  the  principle  of  concentration  at 
country  level.  Programming  with  the  ACP  countries  was  launched  early  in  the  year.  The 

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programming dialogue is in progress and should culminate in Country and Regional Strategy 
Papers ready for signature before end-2007, with implementation starting in January 2008. 

5. 

A BETTER FRAMEWORK FOR WORKING TOGETHER: AID EFFECTIVENESS 

Aid  effectiveness  is  at  the  forefront  of  the  EU’s  political  agenda  and  features  in  all  its 
initiatives in 2006. Both the Joint Development Policy Statement and the New Africa Strategy 
emphasise the importance of delivering not just more aid, but better, more effective European 
aid. The 10th EDF agreement also contains a clear statement in support of aid effectiveness.  

In order to translate these commitments into deeds, an Action Plan (“EU aid: delivering more, 
faster  and  better”)  was  approved  in  April  2006,  with  a  comprehensive  list  of  nine  tangible 
deliverables  to  be  implemented  by  2010.  These  include  the  regular  mapping  of  EU  aid  at 
global,  regional  and  local  levels  (the  Donor  Atlas5),  as  well  as  a  proposal  for  an  EU  Joint 
Programming  Framework  (JPF).  Today,  the  Donor  Atlas  has  become  a  useful  tool  for  both 
monitoring aid and enhancing EU aid co-ordination and division of labour, while the JPF is 
being introduced in a number of countries in the ongoing programming of the 10th EDF. 

Excessive fragmentation of development assistance from the international community has led 
to  dispersion,  duplication  and  even  contradiction  in  aid  activities,  reducing  the  potential 
impact due to an accumulation of unnecessary administrative costs, and increasing the burden 
on the partner countries. The EU Donor Atlas illustrates these gaps and duplications. Greater 
complementarity  of  activities  is  a  key  factor  in  increasing  aid  effectiveness.  In  2006  aid 
effectiveness guidelines were adopted and training courses provided both at Headquarters and 
around the world.  

A  significant  contributor  to  strengthening  partner  country  "ownership"  and  confidence  in 
donor  countries  that  they  can  use  the  partner  country's  own  management  systems 
("alignment"), is the move to providing aid in the form of direct budget support, so that it is 
administered  entirely  within  the  partner  country’s  own  systems.  The  European  Consensus 
identifies  budget  support  as  "the  preferred  modality  where  conditions  allow".  The 
Commission has increased its use of country systems through budget support to just over 35% 
of programmable aid in the EDF between 2003 and 2005. 

The Commission is closely involved in supporting "fragile" states. For instance, in Palestine, 
it has worked closely with the World Bank to design and introduce a Temporary International 
Mechanism  (TIM),  in  order  to  maintain  the  provision  of  essential  public  services  and  to 
protect  ordinary  Palestinians  from  the  effects  of  the  crisis,  with  14  Member  States  and 
Norway contributing. In 2006 the TIM paid over € 88 million in social allowances to public-
sector employees and pensioners with low incomes, and nearly € 24 million was directly paid 
to poor and vulnerable Palestinians directly affected by the crisis. 

In  general  the  Commission  supports  the  use  of  Trust  Funds,  often  managed  by  the  United 
Nations or the World Bank, as a way of delivering aid in such situations. It helps to ensure 
that aid (particularly for reconstruction) is properly co-ordinated and delivered as quickly as 
possible.  In  2006  the  total  amounts  of  aid  delivered  by  the  Commission  through  the  United 
Nations  and  the  World  Bank  remained  at  about  €  1.5  billion.  In  the  course  of  the  year, 
agreements  were  signed  with  both  organisations  on  the  visibility  to  be  given  to  the 

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Commission's contribution to these activities, not least in view of the concerns of many that 
the  European  contribution  towards  relieving  suffering  and  supporting  peace  in  the  world 
should be more evident to Europe’s citizens and to the beneficiaries of this support. 

Seventy  per  cent  of  the  world's  poorest  people  live  in  middle-income  countries.  The 
Commission  recognises  that  economic  growth  is  an  essential  pre-condition  for  social 
development  and  poverty  reduction  strategies  in  these  countries.  However,  growth  alone  is 
not  sufficient.  In  many  fast-growing  middle-income  countries,  technological  change, 
globalisation, demography and demand for skilled labour have contributed to the widening of 
the income distribution gap, because growth has not been accompanied by an effective fiscal, 
pro-poor policy agenda. The risk of a middle-income country failing to make the most of its 
opportunities  and  falling  back  into  poverty  should  not  be  underestimated.  In  this  respect 
further  well  targeted  and  policy/performance-driven  development  aid  is  needed  in  many 
fragile or potentially unstable middle-income countries in order to stabilise their economies, 
support reform and promote development, trade integration and social cohesion.  

In  2006,  the  European  Commission  played  an  increasing  role  in  global  initiatives  in  health 
and education, working together with EU Member States and other donors and stakeholders. 
Since  May  2006,  the  Commission  holds  the  vice-chair  of  the  Global  Fund  to  Fight 
HIV/AIDS, Tuberculosis and Malaria (GFATM). From July 2006 the Commission is also co-
chair of the “Education for All – Fast Track Initiative” (FTI). Both initiatives have focused on 
demand-driven approaches, donor harmonisation and aid effectiveness. 

6. 

RESULTS 

Since  the  reform  of  the  management  of  external  assistance  programmes  was  launched  in 
2000, increased emphasis has been placed on improving the speed and quality of the delivery 
of aid. The levels of implementation achieved in 2006 demonstrate that, again, the speed of 
delivery is improving. 

In total € 9.832 billion of ODA was committed by the Commission in 2006, and € 8.130 was 
paid. Of the amount of commitments which can be geographically allocated, namely € 7.982 
billion, nearly half (€ 3.552 billion) was for ACP countries, which received € 2.848 billion of 
the comparable total of € 6.8 billion payments. 

To evaluate the quality of delivery, the Commission has introduced procedures to ensure that 
new commitments for projects and programmes have been prepared as thoroughly as possible 
and  reflect  best  practice  in  the  sector  concerned.  In  2002  a  system  for  monitoring  project 
results  was  introduced.  Monitoring  is  based  on  regular  on-site  assessments  by  independent 
experts of ongoing projects, and these are given simple scores against internationally agreed 
criteria. Over the last five years, the overall ratings show a steady, and statistically significant, 
improvement.  Projects  and  programmes  monitored  in  2006  maintained  globally  good 
performance.  The  overall  gain  in  efficiency  over  the  last  years  witnessed  a  slight 
consolidating  setback  in  2006,  but  still  remains  on  track.  Overall  the  results  for  2006  have 
been satisfactory. 

Learning  lessons  from  actions  which  have  been  financed  is  a  key  part  of  making  aid  more 
effective. The Evaluation Unit of the main Directorates-General dealing with development aid 
carries out evaluations of country strategies, thematic issues and other strategic aspects of EC 
programmes, using independent experts. 

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In  general  the  various  indicators  demonstrate  that  much  progress  has  been  made  in  the 
management  of  external  assistance  since  2000.  This  is,  not  least,  the  result  of  major 
institutional changes, such as the shift of responsibility for the implementation of programmes 
to the Commission's Delegations, and the restructuring of services at Headquarters.  

Encouragement  can  be  drawn  from  some  important  and  visible  success  stories.  But  much 
remains to be done, especially where the Commission is said to be slow or inflexible, because 
the future shape of external assistance will increasingly be based on flexibility and intensified 
ways  of  working  with  other  donors6.  With  the  new  instruments  and  the  new  Financial 
Regulations, the Commission is now better equipped to face these challenges. 

In  2006,  the  Commission’s  external  action  was  geared  to  achieving  the  following 
objectives: 

- Assisting acceding, candidate and potential candidate countries in moving closer to the 
EU  through  the  implementation  of  the  enlargement  policy  and  the  Stabilisation  and 
Association  process  for  the  Western  Balkans.  Achievements:  ensuring  the  successful 
accession of Bulgaria and Romania to the EU; signing of a Stabilisation and Association 
Agreement with Albania and negotiation of such agreements with Serbia, Montenegro, 
and Bosnia and Herzegovina; adoption of the Instrument for Pre-accession Assistance; 
adoption  of  a  Communication  on  the  Western  Balkans  as  well  as  of  the  annual 
enlargement strategy paper. 

implementation  of 

-  Ensuring  effective 
the  European  Neighbourhood  Policy. 
Achievements:  three  new  Action  Plans  with  Armenia,  Azerbaijan  and  Georgia; 
finalisation  of  the  Action  Plans  with  Egypt  and  Lebanon;  adoption  of  the  European 
Neighbourhood  and  Partnership  Instrument;  informal  presentation  of  the  Strategy 
Papers  to  the  ENPI  Committee  and  the  Parliament;  launch  preparation  of  the  ENPI 
Cross Border Co-operation programme documents; adoption of a new Communication 
on Strengthening the European Neighbourhood Policy. 

-  Ensuring  constructive  engagement  in  the  Middle  East  Peace  Process,  through  the 
Quartet  structure  and  in  close  co-operation  with  the  parties.  Achievements:  creation  of 
the Temporary International Mechanism (TIM): EC support to the Palestinian people 
reached € 339 million. 

-  Continuing  support  for  regional  stability  as  well  as  reconstruction  and  political 
transition  in  Iraq.  Achievements:  preparation  of  the  International  Compact  for  Iraq; 
negotiations  for  a  Trade  and  Co-operation  Agreement  launched;  2006  Assistance 
Programme approved and implemented.  

-  Continuing  the  reconstruction  and  rehabilitation  in  response  to  the  tsunami  disaster. 
Achievements: 
in 
rehabilitation and reconstruction activities committed, mainly for Indonesia, Sri Lanka 
and the Maldives.  

implementation  pace  strongly  accelerated;  €  180  million 

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- Implementing a new development policy to promote sustainable development and poverty 
reduction,  on  the  basis  of  the  framework  proposed  in  2005  and  the  review  of  the 
Millennium Development Goals, including a specific response for Africa. Achievements: 
policy  content  of  the  Consensus  integrated  into  the  Development  and  Co-operation 
Instrument  (DCI),  programming  guidelines  and  regional  strategies  (e.g.  EU  Strategy 
for Africa). 

- Reaffirming a strong commitment to human rights. Achievements: renewed instrument 
for the promotion of democracy and human rights adopted at the end of the year.  

In  addition  to  the  above-mentioned  objectives,  the  Commission  made  progress  in  the 
following fields, for which it also announced key initiatives in 2006: 

-  Achieving  substantial  progress  in  Economic  Partnership  Agreement  negotiations  with 
six  ACP  regions  to  allow  entry  into  force  in  2008.  Achievements:  all  negotiations 
advanced,  analysis  and  capacity-building  actions  provided,  link  between  negotiation 
process and programming of development co-operation ensured. 

-  Contributing  to  the  follow-up  key  initiatives  on  development,  notably  on  financing, 
coherence,  Africa  and  international  public  goods,  as  a  result  of  this  year’s  G8  Summit 
and High-level Plenary meeting on Millennium Development Goals. Achievements: 
action plan on aid effectiveness (“EU aid: delivering more, faster and better”) approved 
with a list of nine deliverables to be implemented by 2010. 

the  Commission’s  response  capacity 

to  humanitarian  disasters, 
-  Reinforcing 
strengthening  its  disaster  prevention  and  preparedness  strategy,  and  addressing  the  EU 
contribution  to  the  Global  Health  Fund  for  AIDS/HIV,  Malaria  and  Tuberculosis. 
Achievements: consultation of partners and EU Member States launched to feed into a 
communication on 'Towards a European Consensus on Humanitarian Aid' to be issued 
in 2007; annual contribution to the Global Fund of € 90 million. 

EN 

11 

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Table 1: 2000-2006 Poverty focus.

Net Disbursements

45.8%

32.0%

21.6%

18.4%

10.4%

3.1%

39.5%

37.9%

26.7%

15.1%

11.2%

5.3%

43.1%

36.9%

32.7%

16.3%

10.4%

2.5%

44.5%

43.7%

46.1%

46.1%

35.8%

30.7%

33.4%

33.5%

31.0%

28.6%

21.8%

22.4%

22.3%

8.7%

3.0%

12.6%

10.3%

2.9%

3.0%

32.9%

31.0%

18.1%

13.2%

4.9%

50%

40%

30%

20%

10%

0%

2000

2001

2002

2003

2004

2005

2006

LDC

OLIC

LMIC

UMIC

REGION / UNALLOC

LDC+OLIC

2000-2003 EC reporting to DAC (following the same method: LDCs/LICs country specific allocations -including 
EIB- /Total disbursements)
2004, 2005 Annual Report information
2006 Provisional figures Annual Report exercise (According to DAC List of recipient available at December 2005)

LDC : Least Developed Countries

OLIC : Other Low Income Countries

LMIC : Lower Middle Income Countries

UMIC : Upper Middle Income Countries
REGION / UNALLOC : Regional Programmes and Unallocated

EN 

12 

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Table 2: EuropeAid - Evolution of Regional breakdown 2001-2006 Commitments - € Million)

Thematic

ACP (1)

South Africa

Mediterranean

Asia

Latin America

NIS

Balkans

2006
2005
2004
2003
2002
2001

-

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

Balkans

2001

2002

2003

2004

2005

2006

705 

658 

620 

663 

519 

524 

NIS

426 

432 

504 

504 

515 

528 

Latin 
America
301 

333 

342 

312 

329 

356 

Asia

407 

575 

558 

611 

834 

853 

Mediterra
nean
709 

South 
Africa
121 

762 

782 

1.003 

1.075 

1.178 

124 

127 

135 

155 

125 

ACP (1)

Thematic

Total

1.971 

2.169 

3.811 

2.685 

3.546 

3.477 

928 

949 

943 

1.001 

1.055 

1.097 

5.568 

6.002 

7.687 

6.916 

8.027 

8.137 

Commitments 2006 made by EuropeAid + Enlargement (Balkans).
Excluding administrative costs managed by EuropeAid
Regional breakdown following geographic and thematic budget lines
(1) ACP Region includes EDF + Bananas & Sugar budget line 2001-2006

EN 

13 

   EN 

 
     
     
     
     
     
     
  
     
  
     
     
     
     
     
     
  
     
  
     
     
     
     
     
     
  
     
  
     
     
     
     
  
     
  
  
  
     
     
     
     
  
     
  
  
  
     
     
     
     
  
     
  
  
  
 
 
Table 3: EuropeAid - Evolution of Regional breakdown 2001-2006 (Payments - € Million)

Thematic

ACP (1)

South Africa

Mediterranean

Asia

Latin America

NIS

Balkans

2006
2005
2004
2003
2002
2001

-

500 

1.000 

1.500 

2.000 

2.500 

3.000 

Balkans

2001

2002

2003

2004

2005

2006

845 

619 

425 

510 

345 

547 

NIS

402 

384 

396 

359 

432 

445 

Latin 
America
152 

182 

290 

314 

376 

343 

Asia

383 

455 

470 

526 

681 

737 

Mediterra
nean
488 

South 
Africa
99 

707 

700 

1.125 

1.122 

1.235 

119 

118 

116 

138 

107 

ACP (1)

Thematic

Total

1.814 

1.968 

2.366 

2.472 

2.468 

2.848 

771 

815 

851 

790 

932 

774 

4.109 

4.630 

5.191 

5.701 

6.149 

7.037 

Payments 2006 made by EuropeAid + Enlargement (Balkans).
Excluding administrative costs managed by EuropeAid
Regional breakdown following geographic and thematic budget lines
(1) ACP Region includes EDF + Bananas & Sugar budget lines 2001-2006

EN 

14 

   EN 

 
     
     
     
     
     
       
  
     
  
     
     
     
     
     
     
  
     
  
     
     
     
     
     
     
  
     
  
     
     
     
     
  
     
  
     
  
     
     
     
     
  
     
  
     
  
     
     
     
     
  
     
  
     
  
 
 
Table 4: Sectoral Breakdown

9. Other/Unallocated : 
Admin. Costs, Support to 
NGOs, Unspecified;  278 
M€; 3%

7. Emergency assistance, 
Reconstruction Relief;  795 
M€; 10%

5. Budget Support, Food 
Aid, Food Security;  615 
M€; 8%

. Multisector/Crosscutting: 
Environment, Women in 
development, Other;  996 
M€; 12%

3. Production : Agriculture, 
Forestry & Fishing, 
Industry, Mining & 
Construction, Trade & 
Tourism;  771 M€; 10%

2. Economic Infrastructures 
& Services : Transport, 
Communications, Energy, 
Other services; 1 176 M€; 
15%

Commitments 2006 (€ Million)

ODA/OA resources managed by EuropeAid and CARDS.

Excluding administrative costs managed by EuropeAid

1. Social Infrastructures: 
Education, Health, Water, 
Government & Civil 
Society, Other ; 3 416 M€; 
42%

EN 

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Table 5: European Consensus : Areas relating to EU development co-operation

10. Multi areas; 1 150 M€; 
14%

1. Governance and support 
for economic and 
institutional reforms; 1 429 
M€; 18%

2. Trade and regional 
integration;  512 M€; 6%

3. Infrastructure and 
transport; 1 339 M€; 17%

9. Conflict prevention and 
state fragility;  448 M€; 6%

8. The environment and 
sustainable management 
of natural resources;  224 
M€; 3%

7. Rural development, 
territorial planning, 
agriculture and food 
security;  764 M€; 9%

6. Human and social 
development; 1 050 M€; 
13%

5.Social cohesion and 
employment;  321 M€; 4%

4. Water and energy;  810 
M€; 10%

Commitments 2006 (€ Million)

ODA/OA resources managed by EuropeAid and CARDS.

Excluding administrative costs managed by EuropeAid

EN 

16 

   EN