Commission staff working document - Annex to the Report from the Commission to the Council and the European Parliament - Annual Report 2008 on the European Community's Development and External Assistance Policies and their Implementation in 2007 (COM(2008)379)
Date: 2008-06-23
Institutions: European Commission
Subjects: activity report, aid evaluation, aid policy, cooperation policy, developing countries, development aid, impact study

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 23.06.2008 
SEC(2008)2062 

COMMISSION STAFF WORKING DOCUMENT 

Annex to the 

REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN 
PARLIAMENT 

Annual Report 2008 on the European Community's Development and External 
Assistance Policies and their Implementation in 2007 

(COM(2008)379) 

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TABLE OF CONTENTS 

COMMISSION STAFF WORKING DOCUMENT Annex to the............................................ 1 

REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN 
PARLIAMENT Annual Report 2008 on the European Community's Development and 
External Assistance Policies and their Implementation in 2007 ................................................ 1 

1. 

1.1. 

1.2. 

1.3. 

1.4. 

1.5. 

1.6. 

1.7. 

1.8. 

1.9. 

POLICY ....................................................................................................................... 6 

Introduction .................................................................................................................. 6 

Annual Policy Objectives............................................................................................. 7 

Implementation of the European Consensus on Development .................................... 8 

Coherence between development and other policies ................................................... 9 

Mainstreaming of cross-cutting issues ....................................................................... 12 

Aid effectiveness and co-financing............................................................................ 15 

Partnership with United Nations and World Bank..................................................... 19 

Poverty focus in middle-income countries................................................................. 23 

Sectoral policy / strategy developments..................................................................... 24 

1.9.1.  ENP ............................................................................................................................ 31 

1.9.2.  Aid for Trade.............................................................................................................. 31 

1.10.  Outlook 2008 (conclusions and perspectives)............................................................ 32 

2. 

IMPLEMENTATION ................................................................................................ 34 

2.1. 

European Neighbourhood and Partnership ................................................................ 34 

2.1.1.  Bilateral cooperation .................................................................................................. 34 

2.1.1.1.  Introduction ................................................................................................................ 34 

2.1.1.2.  Aid effectiveness and donor coordination.................................................................. 36 

2.1.1.3.  Working towards the MDGs ...................................................................................... 37 

2.1.1.4.  Regional cooperation and integration ........................................................................ 37 

2.1.1.5.  Implementation .......................................................................................................... 38 

2.1.1.6.  Monitoring.................................................................................................................. 43 

2.1.1.7.  Perspectives................................................................................................................ 44 

2.1.2.  Cross-Border cooperation (CBC)............................................................................... 45 

2.2. 

European Development Fund..................................................................................... 46 

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2.2.1. 

Introduction ................................................................................................................ 46 

2.2.2.  Africa.......................................................................................................................... 48 

2.2.2.1.  Introduction ................................................................................................................ 48 

2.2.2.2.  Aid effectiveness and donor coordination.................................................................. 49 

2.2.2.3.  Working towards the MDGs ...................................................................................... 49 

2.2.2.4.  Regional cooperation and integration ........................................................................ 50 

2.2.2.5.  Implementation .......................................................................................................... 51 

2.2.2.6.  Monitoring.................................................................................................................. 52 

2.2.2.7.  Perspectives................................................................................................................ 52 

2.2.3.  Caribbean (incl. OCTs) .............................................................................................. 54 

2.2.3.1.  Introduction ................................................................................................................ 54 

2.2.3.2.  Aid effectiveness and donor coordination.................................................................. 55 

2.2.3.3.  Working towards the MDGs ...................................................................................... 55 

2.2.3.4.  Regional cooperation and integration ........................................................................ 56 

2.2.3.5.  Implementation .......................................................................................................... 56 

2.2.3.6.  Monitoring.................................................................................................................. 56 

2.2.3.7.  Perspectives................................................................................................................ 57 

2.2.4.  Pacific (incl. OCTs) ................................................................................................... 59 

2.2.4.1.  Introduction ................................................................................................................ 59 

2.2.4.2.  Aid effectiveness and donor coordination.................................................................. 59 

2.2.4.3.  Working towards the MDGs ...................................................................................... 60 

2.2.4.4.  Regional cooperation and integration ........................................................................ 60 

2.2.4.5.  Implementation .......................................................................................................... 61 

2.2.4.6.  Monitoring.................................................................................................................. 61 

2.2.4.7.  Perspectives................................................................................................................ 62 

2.2.5.  Global Programmes.................................................................................................... 64 

2.3. 

Development Cooperation Instrument ....................................................................... 65 

2.3.1.  Asia ............................................................................................................................ 65 

2.3.1.1.  Introduction ................................................................................................................ 65 

2.3.1.2.  Aid effectiveness and donor coordination.................................................................. 66 

2.3.1.3.  Working towards the MDGs ...................................................................................... 67 

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2.3.1.4.  Regional cooperation and integration ........................................................................ 68 

2.3.1.5.  Implementation .......................................................................................................... 69 

2.3.1.6.  Monitoring.................................................................................................................. 70 

2.3.1.7.  Perspectives................................................................................................................ 71 

2.3.2.  Central Asia................................................................................................................ 72 

2.3.2.1.  Introduction ................................................................................................................ 72 

2.3.2.2.  Aid effectiveness and donor coordination.................................................................. 73 

2.3.2.3.  Working towards the MDGs ...................................................................................... 73 

2.3.2.4.  Regional cooperation and integration ........................................................................ 73 

2.3.2.5.  Implementation .......................................................................................................... 74 

2.3.2.6.  Monitoring.................................................................................................................. 74 

2.3.2.7.  Perspectives................................................................................................................ 75 

2.3.3.  Middle-East ................................................................................................................ 76 

2.3.3.1.  Introduction ................................................................................................................ 76 

2.3.3.2.  Implementation .......................................................................................................... 76 

2.3.4.  Latin America............................................................................................................. 78 

2.3.4.1.  Introduction ................................................................................................................ 78 

2.3.4.2.  Aid effectiveness and donor coordination.................................................................. 79 

2.3.4.3.  Working towards the MDGs ...................................................................................... 79 

2.3.4.4.  Regional cooperation and integration ........................................................................ 80 

2.3.4.5.  Implementation .......................................................................................................... 80 

2.3.4.6.  Monitoring.................................................................................................................. 83 

2.3.4.7.  Perspectives................................................................................................................ 84 

2.3.5.  South Africa ............................................................................................................... 85 

2.3.5.1.  Introduction ................................................................................................................ 85 

2.3.5.2.  Aid effectiveness and donor coordination.................................................................. 85 

2.3.5.3.  Working towards the MDGs ...................................................................................... 86 

2.3.5.4.  Regional cooperation and integration ........................................................................ 86 

2.3.5.5.  Implementation .......................................................................................................... 86 

2.3.5.6.  Monitoring.................................................................................................................. 87 

2.3.5.7.  Perspectives................................................................................................................ 87 

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2.3.6.  Accompanying measures for Sugar Protocol countries ............................................. 89 

2.3.7. 

Investing in people ..................................................................................................... 90 

2.3.8.  Non-State actors and local authorities in development.............................................. 92 

2.3.9.  Migration and asylum ................................................................................................ 93 

2.3.10.  Environment and sustainable management of natural resources including energy ... 94 

2.3.11.  Food security.............................................................................................................. 95 

2.4. 

2.5. 

Democracy and Human Rights .................................................................................. 98 

Stability .................................................................................................................... 104 

2.5.1.  Crisis response and preparedness............................................................................. 104 

2.5.2.  Global and regional trans-border challenges............................................................ 106 

2.6. 

2.7. 

2.8. 

3. 

4. 

4.1. 

4.2. 

Nuclear Safety.......................................................................................................... 111 

Humanitarian Assistance.......................................................................................... 114 

Macro-financial assistance ....................................................................................... 117 

FEATURE ARTICLES............................................................................................ 118 

RESULTS ................................................................................................................ 128 

Project results: Results-Oriented Monitoring (ROM).............................................. 128 

Evaluation: review of the 2007 work programme.................................................... 131 

4.2.1.  Organisation of the evaluation function................................................................... 131 

4.2.2.  The 2007 work programme...................................................................................... 132 

4.2.3.  Lessons learned from evaluations finalised in 2007 ................................................ 133 

4.2.4.  Synthesis of main lessons learned............................................................................ 136 

4.2.5.  Outlook for 2008 ...................................................................................................... 136 

5. 

5.1. 

5.2. 

5.3. 

5.4. 

5.5. 

6. 

6.1. 

6.2. 

AID MANAGEMENT............................................................................................. 136 

Developments in aid delivery modalities and channels ........................................... 136 

Progress on qualitative issues in aid management ................................................... 140 

Cooperation with international organisations and other donors .............................. 142 

Simplification of procedures .................................................................................... 144 

Visibility and communication .................................................................................. 145 

ANNEXES ............................................................................................................... 145 

Introduction to financial tables................................................................................. 145 

Financial tables......................................................................................................... 148 

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1. 

POLICY 

1.1. 

Introduction 

2007  marked  a  major  achievement  within  the  framework  of  the  external  actions  of 
the  European  Union  as  the  Presidents  of  the  European  Commission,  European 
Parliament  and  Council  of  the  European  Union  signed  the European  Consensus  on 
Humanitarian  Aid.  This  agreement  further  refines  and  consolidates  the  EU’s 
humanitarian policy by affirming a common EU vision and a practical approach for 
helping millions of people worldwide who suffer from conflicts and natural disasters. 

It was the first year of the implementation of the new Financial Perspectives and the 
implementation  of  the  new  external  action  instruments  for  the  delivery  of  EC 
assistance for the period 2007-2013 as well as the programming of the 10th European 
Development  Fund,  which  covers  the  geographical  cooperation  with  the  ACP 
countries and the Overseas Countries and Territories. 

In  July,  the  Development  Assistance  Committee  (DAC)  of  the  OECD  issued  a 
review of the aid policies and programmes of the European Commission – including, 
for the first time, humanitarian aid1. The Peer Review team, led by the United States 
the  European 
and  Australia,  recognised 
Commission;  as  a federator of aid from the 27 EU Member States, which accounts 
for more than half of all Official Development Assistance (ODA), as well as the sixth 
largest donor. 

the  unique  contribution  made  by 

In  terms  of  greater  public  development  aid  and  aid  for  trade  commitment 
compliance,  the  European  Union  is  on  the  right  track,  despite  a  slight  decrease  in 
total  aid  in  2007.  Giving  60%  of  total  aid,  the  EU  is  committed  to  continue 
increasing its contribution effort while consolidating its status as the world's leading 
donor.  “Aid  for  Trade”  clarifies  the  EU’s  strategy  to  deliver  on  its  2005  promises 
made at the World Trade Organisation (WTO) Ministerial in Hong Kong to increase 
its spending on Trade-Related Assistance, beginning in 2010, to €2 billion per year – 
which  will  include  €1  billion  from  the  Co mmunity  aid  budget  and  €1  billion  in 
bilateral aid from the Member States. 

To  render  EU  development  policy  more  efficient,  the  Commission  and  Member 
States adopted a Code of Conduct, which contains ten principles for a better division 
of  labour  among  EU  donors  in  developing  countries.  The  implementation  of  the 
Consensus  has  also  been  advanced  by  an  EU  Report  on  Policy  Coherence  for 
Development  (PCD)  and  Communications  on  gender2,  and  on  State  Fragility3.  The 
European  Union's  first  Report  on  Policy  Coherence  for  Development  (PCD)  was 
adopted  in  September  and  highlights  the  interaction  and  the  complementarities 
between development policy and twelve other internal and external EU policies that 
impact  developing  countries.  A  Communication  entitled  European  Agenda  for 

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DCD/DAC/AR(2007)2/EC/PART1/FINAL  and  DCD/DAC/AR(2007)2/EC/PART2/FINAL  of  4  and  9 
July 2007 respectively 
COM(2007)100 final 
COM(2007)643 final 

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Culture in a globalizing world4 highlights the role of culture within both Europe and 
EU external relations. 

The  implementation  of  the  European  Neighbourhood  Policy  (ENP),  which  was 
discussed  in  September  during  the  first  ENP  Ministerial  Conference  by  all  EU  and 
ENP  states  and  more  than  700  participants  representing  the  governmental  sector, 
non-governmental organisations and business groupings, made important progress. 

The adoption of the Joint Africa-EU Strategy at the Lisbon Summit on 9 December 
together with its first Action Plan confirmed the long-standing EU-Africa partnership 
to new realities, new challenges and new opportunities and thus establishes clear and 
measurable priorities for 2008-2010 that will serve as a common roadmap for action. 

1.2. 

Annual Policy Objectives 

In  2007,  the  Commission's  external  action  was  geared  towards  achieving  the 
following five objectives: 

•  Establish a renewed market access strategy that addresses trade barriers and create 
new  openings  for  trade  and  investment  worldwide  while  taking  into  account 
competitiveness, social and environmental concerns; 

•  Conclude  negotiations  on  Economic  Partnership  Agreements,  which  represent  a 
cornerstone  for  the  regional  integration  of  the  ACP  countries  and  for  their 
development; 

•  Reinforce  the  European  Neighbourhood  Policy  in  areas  that  support  deeper 
economic and trade integration, greater mobility for ENP citizens in the EU, and a 
Neighbourhood  Investment  Fund.  Set  out  proposals  for  successor  arrangements 
with  Ukraine,  Moldova  and  Israel,  whose  Action  Plans  expire  in  2008.  Make 
proposals for enhanced EU presence in Black Sea cooperation, including regional 
ENP partners as well as Russia and Turkey; 

•  Negotiate Association Agreements with several major partners in Asia and Latin 
America, while making progress in the negotiations with major strategic partners 
such as Russia, China and Ukraine; 

•  Continue  to  implement  the  European  Security  Strategy,  in  the  area  of  human 
security  in  particular.  Continue  stabilisation  efforts  in  the  Middle  East  and  in 
South Asia. 

As  documented  throughout  this  report,  considerable  progress  was  made  in  each  of 
these  areas.  Moreover,  the  Commission  also  made  progress  in  the  following  fields, 
for which it had announced strategic initiatives in 2007: 

•  Establish  Erasmus  Mundus  2009-2013,  a  programme  promoting  cooperation 
between higher education institutions and the mobility of students, researchers and 

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Joint  Communication  of  Commission  Directorates  General  Education  and  Culture,  Development  and 
External Relations. COM(2007)242 final 

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academic staff between the EU and third countries. The programme also aims at 
fostering intercultural understanding and improving quality in higher education; 

•  Prepare a Communication on complementarity, division of labour and scaling up 

of development aid; 

•  Prepare a Communication reviewing the current condition of EU-Africa relations 

(including the EU Strategy for Africa and the Joint EU-Africa Strategy). 

1.3. 

Implementation of the European Consensus on Development 

The  European  Consensus  on  Development  provides  a  strategic  foundation  for  EU 
development cooperation that is firm and coherent. It integrates the commitments of 
the  international  community;  it  states  its  support  for  the  Millennium  Development 
Goals (MDGs); and it reflects global changes and challenges, particularly in relation 
to security, migration and the social dimension of globalisation. 

The  Consensus  provides  a  common  vision  of  development  policy  for  both  the 
Member States and the European Community (EC). It shows the way to improve the 
interaction  between  individual  Member  States'  aid  and  that  of  the  EC.  It  reflects  a 
greater involvement of all EU institutions in the formulation of this common policy 
vision.  With  regard  to  the  geographical  scope  of  the  Consensus,  it  guides  EC  and 
Member State development cooperation activities in all developing countries. 

The Commission has ensured that the objectives and principles of the Consensus are 
expressed in the regional strategies. In 2007, the Commission elaborated regional and 
country strategies for all ACP countries for the period 2008-2013. These regional and 
country  strategy  papers  were  developed  in  compliance  with  the  Consensus.  Key 
pillars of this process, even when success in implementing these guiding principles is 
uneven, 
include  country  ownership;  alignment  with  national  development 
programmes  and  strategies,  non-state  actor  and  local  authority  participation;  and 
Commission and Member State joint analysis of the political, social and governance 
situations. The implementation of the Consensus was also taken a step further with 
the  issuing  of  a  strategy  to  address  situations  in  fragile  states  with  appropriate 
approaches and instruments. 

A new EU-Africa Partnership was adopted at the Lisbon Summit in December. This 
new  partnership  is  a  true  measure  of  the  European  Consensus  and  further  deepens 
EU-Africa relations. Indeed, the deepening of the political dialogue (on issues such 
as migration, and peace and security, to name but a few) as well as the variety of the 
areas covered (on issues such as education, research, information technology, space) 
attest to a broader relationship between the EU and its African partners. 

Responding to the call for more coordination and harmonisation between EU donors, 
the Commission proposed to the Member States a Code of Conduct for the division 
of labour. The Code adopted by the Council presents principles for determining best 
use  of  the  collective  capacities  and  resources  of  the  EU  in  support  of  partner 
countries. These innovations form  an important milestone in the implementation of 
the Paris Declaration on Aid Effectiveness. Treaty reform, as recently agreed, should 
facilitate their gradual implementation in the coming years. 

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Finally,  the  EU's  commitments  to  the  MDGs  have  been  reaffirmed  in  2007;  in 
particular through the Commission's support to the UN Secretariat General's MDGs 
Initiative,  together  with  several  other  multilateral  institutions.  The  EU  is  preparing 
for  a  series  of  important  events  in  2008  that  should  provide  international  political 
momentum to renew efforts towards meeting the MDGs commitments by 2015. 

1.4. 

Coherence between development and other policies 

To  advance  the  implementation  of  the  European  Consensus,  in  September  the 
Commission issued the first ever EU Report on Policy Coherence for Development5. 
Beyond  the  Consensus,  the  policy  framework  that  served  as  a  reference  for  this 
report  was  set  in  2005,  as  part  of  the  package  of  measures  to  accelerate  progress 
towards  the  MDGs6.  The  report  reviews  progress  made  in  strengthening  coherence 
between twelve policies that affect developing countries and EU development policy 
objectives, and identifies outstanding issues7. 

Indeed,  policies  other  than  development  cooperation  have  a  strong  impact  on 
developing  countries.  What’s  more,  the  EU  concept  of  Policy  Coherence  for 
Development,  enshrined  in  the  Treaty  and  reinforced  by  the  European  Consensus, 
aims to build synergies between those policies and development objectives. This in 
turn will serve to increase the effectiveness of development aid. Ensuring that these 
resources  are  not  wasted  or  used  inefficiently  as  a  result  of  policy  incoherence  is 
crucial,  especially  when  considering  the  EU's  commitment  to  increase  official 
development assistance substantially. 

EU  trade  policy  provides  developing  countries  a  favourable  market  access  regime. 
Specifically,  the  EU’s  market  access  regime  offers  Most-Favoured  Nation  (MFN) 
import  duty  rates  of  4%  for  non-agriculture  products  and  18.6%  for  agriculture 
products,8 for an overall average of just 6.9%. In the context of the EU Generalised 
System of Preferences (GSP) exports from developing countries enjoy a zero percent 
duty rate or receive a 3.5 percentage point discount on this rate (see section on GSP 
below). Under the Everything But Arms (EBA) initiative, this means that goods from 
Least  Developed  Countries  (LDCs)  enjoy  tariff-  and  quota-free  access  to  the  EU 
market.  Moreover,  the  EU  grants  duty-free  treatment  for  the  vast  majority  of  ACP 
exports  since  the  Lomé  Convention  entered  into  force  in  1975  and  this  has  been 
further extended with the EPAs. 

The  most  generous  tariff  preferences  for  developing  countries  are  those  granted  to 
LDCs (under EBA) and ACP countries (under the Cotonou trade regime in 2006-07 
and  since  January  2008  under  the  EPA  Market  Access  Regulation).  Developing 
countries  enjoy  important  tariff  preferences,  especially  on  the  European  market. 

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http://ec.europa.eu/development/icenter/repository/CONS_COMM_PDF_COM_2007_0545_F

_ACTE_en.pdf 
Commission  Communication  on  'Policy  Coherence for Development  –  Accelerating  progress  towards 
attaining the Millennium Development Goals' – COM(2005) 134 final of 12 April 2005 and May 2005, 
General  Affairs  and  External  Relations  Council  (GAERC)  Conclusions  on  the  Millennium 
Development Goals (Doc. 9266/05). 
Trade,  Environment,  Climate  change,  Security,  Agriculture,  Fisheries,  Social  dimension  of 
globalisation, Migration, Research, Information Society, Transport, Energy 
WTO European Communities Trade Policy Review 2007. 

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Even so, it is important to note that the share of the poorest countries in international 
trade remains marginal, while their relative share in imports to the EU has fallen in 
the  face  of  competition  from  other  countries,  and,  in  particular,  from  other 
developing  countries.  Therefore,  to  facilitate  their  closer  integration  into  the  world 
economy, it is important not only to reduce market access barriers, but also to take 
into account and to address a range of other factors that include those relating to the 
competitiveness and supply side capacity of individual developing countries. 

trade  policy 

is  multi-dimensional  –  multilateral,  regional/bilateral  and 
EU 
autonomous. Yet, under each of these dimensions, EU trade policy includes elements 
that respond to the particular needs of developing countries and support their further 
development  and  beneficial  integration  into  the  global  trading  system,  including 
through  achieving  improved  performance  within  the  EU  market.  Accordingly, 
examples of how the EU pursues its pro-development policy objectives can be found 
at all levels: multilaterally, through the WTO negotiations; regionally and bilaterally, 
through the negotiation of trade agreements with other countries or regions such as 
the EPAs with the ACP countries and support to developing countries' own regional 
integration  processes;  and  unilaterally, 
the  Generalised  System  of 
Preferences. The EU is also very actively engaged in the provision of Aid for Trade 
to developing countries to support them in overcoming the challenges of integration 
both at the regional and global level. In this context, regional integration offers one 
important  way  toward  improving  the  position  of  developing  countries  and  their 
ability to compete in international markets by creating larger regional markets and by 
improving  the  general  business  environment.  This  is  particularly  important  for  the 
poorest countries as these efforts can improve their international competitiveness by 
attracting more investment and by placing them in a better position to take advantage 
of emerging market opportunities in non-traditional export markets, including those 
of other developing countries. 

through 

In  agriculture,  the  EU  has  come  a  long  way  in  making  its  Common  Agricultural 
Policy more development-friendly. With low or zero tariffs on most products, access 
to the EU market is generally favourable to developing countries. Important progress 
was  made  through  successive  reforms  on  export  subsidies  as  well  as  the  distorting 
effects  on  markets  of  domestic  agricultural  subsidies.  EU  development  cooperation 
supports agricultural and rural development in Africa particularly. 

On the fisheries front, a new generation of Fisheries Partnership Agreements should 
lead  to  the  replacement  of  all  existing  fishery  agreements  by  2008.  The  principal 
objective  of  the  new  generation  of  agreements  is  to  move  beyond  merely  securing 
European  fleet  access,  but  to  introduce  responsible  and  sustainable  fishing  by 
supporting  the  fishery  policies  of  partner  countries  also.  While  progress  has  been 
measured  already,  further  improvements  are  possible  –  in  the  evaluation  of  fish 
stocks  in  developing  countries  in  particular.  In  addition,  the  financial  envelopes 
linked  to  the  Fisheries  Partnership  Agreements  can  be  substantial,  and  the  use  of 
such  funds  needs  to  be  monitored  so  as  to  ensure  that  local  fishery  activities  are 
supported.  Likewise,  the  control,  monitoring,  and  surveillance  systems  that  counter 
illegal,  unreported,  and  unregulated  fishing  will  continue  to  require  further 
international cooperation. 

As  for  climate  change,  all  efforts  deployed  under  the  ambitious  EU  climate  policy 
will  directly  benefit  the  poorest  and  most  vulnerable  developing  countries  as  these 

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policies look toward the long term goal of limiting temperature change to an average 
of  2°C  relative  to  pre-industrial  levels.  Partner  countries  will  also  benefit  from  the 
positive  externalities  of  scientific  research  programmes  and  investments  in 
appropriate technologies. 

Further  investigation  and  proactive  measures  are  needed,  however,  to  avoid  the 
potential  negative  effects  of  the  EU  bio-fuels  policy.  Improvements  toward 
integrating  climate  change  concerns  into  the  policy  dialogue  between  the  EU  and 
developing  countries  are  needed.  Increased  support  for  adaptation  in  development 
cooperation programmes is similarly needed. The Commission proposal to establish 
a  Global  Climate  Change  Alliance  (GCCA)  between  the  EU  and  its  developing 
country  partners,  particularly  the  most  vulnerable  ones,  is  an  important  step  in  that 
direction9. This was the main topic of the "European Development Days" conference 
that was organised in Lisbon last November. 

As for security, the EU deploys a broad range of instruments for both security and 
development. In the recent past, the EU has been strengthening the links between the 
two, but the diversity of contexts and situations as well as the complexity of the EU's 
institutional setting as a security actor constitute important challenges. Active efforts 
include  integrating  conflict  prevention  in  development  cooperation,  addressing 
situations  of  fragility,  promoting  transparency  and  equity  in  the  management  of 
natural  resources,  supporting  disarmament,  demobilisation  and  reintegration  and 
security  sector  reform,  controlling  arms  exports  and  the  illicit  trafficking  of  small 
arms,  human  beings,  narcotics  and  explosives.  However,  to  respond  to  the 
requirements  of  the  African  continent  further  efforts  are  needed  and  concrete 
initiatives are considered through a package of development and security measures in 
the framework of the EU-Africa partnership. 

In energy, the EU is engaged in several major initiatives to support the provision of 
adequate,  affordable  and  sustainable  energy  services  in  developing  countries,  most 
the  EU  Energy  Initiative  for  Poverty  Eradication  and  Sustainable 
notably 
Development and the EU-Africa Partnership on Energy. The new energy policy for 
Europe,  that  aims  to  deliver  sustainable,  secure  and  competitive  energy  to  all  EU 
Member States, also aims to integrate Europe's energy and development policies into 
a win-win approach.  Developing  countries, particularly in Africa, will benefit from 
the  EU's  efforts  to  diversify  energy  supply  and  to  develop  energy-efficient  and 
renewable energy technologies. 

Finally,  to  meet  development  ambitions  in  general  and  the  MDGs  in  particular, 
capacity building and international cooperation in science and technology are viewed 
as policy areas of pivotal importance. On the one hand, science and technology need 
to  be  approached  in  connection  with  education  and  investment  in  innovation 
capacities, while on the other, sectoral policy areas such as demographics, food and 
agriculture,  health,  environment,  sustainable  energy,  ICTs,  and  trade  should  be 
linked. Likewise, promoting 'brain circulation' rather than 'brain drain' and capacity 
building  in  research  and  technology  to  increase  access  to  research  programmes  for 
developing  countries  are  two  areas  in  which  policy  coherence  for  development  can 
be  further  enhanced.  In  addition,  the  different  thematic  areas  of  the  Research 

9 

See also feature article The challenge of reconciling MDGs and the fight against climate change 

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Framework  Programme  (RFP)  include  specific  international  cooperation  actions 
(SICAs) that can address the particular needs of developing countries on the basis of 
mutual  interest  and  mutual  benefit.  Indeed,  the  complete  opening  of  the  seventh 
Research  Framework  Programme  (2007-2013) 
including 
developing  countries,  can  help  strengthen  the  capacities  of  the  participating 
countries. It will be toward these ends that the Commission will continue to work to 
encourage  greater  synergies  between  different  policies  and  instruments,  and 
development objectives in 2008. 

third  countries, 

to 

1.5.  Mainstreaming of cross-cutting issues 

Democratic governance 

Democratic governance is not only an end in itself, it is also crucial for sustainable 
development  in  sectors  such  as  education,  justice,  transport,  water,  and  health,  and 
thus for the timely achievement of the MDGs. Indeed, democratic governance is vital 
for  efficient  service  delivery.  The  Commission  is  therefore  committed  strongly  to 
promote  and  to  support  the  efforts  of  partner  countries  to  improve  democratic 
governance  within  all  sectors  of  each  of  their  respective  societies.  This  is  done  by 
supporting initiatives at both local and national levels that strengthen accountability, 
increase  transparency,  expand  popular  participation  in  development  processes  and 
fight corruption and mismanagement. More specifically, relying upon solid standards 
of  conduct  and  promoting  sound  principles  of  openness,  transparency  and 
professional merit in the context of the efforts to strengthen democratic governance, 
the Commission strongly encourages the development of a professional and unbiased 
civil  service.  Although  the  Commission  is  already  well  advanced  in  addressing 
governance  challenges  at  sector  levels,  more  work  is  being  done  to  improve  and 
systematise  implementation  further.  In  doing  so,  the  Commission  underscores  that 
governance is unique to the specific situation and context of each country; that it is 
important  that  donors  are  not  normative;  and  that  governance  reforms  are  home 
grown, owned by the partner country, and sought progressively (i.e. a "good enough 
governance" approach should be applied). 

Gender 

Promotion  of  equality  between  men  and  women  takes  an  important  place  in  EU 
foreign policy. Gender equality is taken into account both in political dialogues and 
in  external  assistance.  A  Communication  on  Gender  Equality  and  Women's 
Empowerment  in  Development  Cooperation  adopted  in  March  for  the  first  time 
advances  a  strategy  at  the  European  level10.  This  strategy  provides  guidance  for 
making gender mainstreaming more effective, proposes specific actions in five fields 
and  describes  the  various  ways  of  promoting  gender  equality  through  the  new  aid 
delivery methods. The Council called on the Commission to prepare an action plan 
on  gender  equality  and  women's  empowerment  in  development  cooperation  and  to 
ensure  its  follow-up.  In  addition,  so  as  to  ensure  more  effective  mainstreaming  of 
gender equality in the Commission's actions, a Communication will be prepared on 
the mainstreaming of horizontal issues (environment, human rights, gender equality, 
HIV/AIDS). 

10 

COM(2007)100 final 

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In several country strategy papers for the 10th European Development Fund (2007-
2013) the promotion of equality was thoroughly taken into account in the analysis of 
the situation and in the Commission's strategic answer. The ENP action plans agreed 
with  the  partner  countries  contain  provisions  to  promote  the  role  of  women  in 
economic  and  social  progress  and  to  fight  against  discriminations  and  violence 
towards  women.  Women's  rights  issues  are  addressed  in  the  sub-committees  that 
ensure  the  monitoring  of  the  ENP  –  in  the  human  rights  and  democracy  sub-
committees in particular. 

Within the Euro-Mediterranean partnership, the Commission played a crucial role to 
ensure  the  monitoring  of  the  Istanbul  Framework  of  Action  and  of  measures  to 
promote  women's  rights  and  their  full  participation  in  the  civil,  political,  social, 
economic and cultural fields. An ad hoc meeting was held in October to discuss the 
follow-up given to the conclusions of Istanbul during its first year of implementation. 
A  report  on  the  main  initiatives  implemented  by  the  Euro-Mediterranean  partners 
was finalised near the end of 2007, while two further ad hoc meetings will be held in 
2008. 

The  Commission  supports  state  and  non-state  actors  active  in  the  field  of  gender 
equality promotion through various instruments, including the "Investing in People" 
thematic programme, the regional programme on gender equality and the European 
Instrument for Democracy and Human Rights. 

The  Commission  engaged  in  a  strategic  partnership  with  UNIFEM  and  the 
International Training Centre (ITC/ILO) toward promoting equality for development 
and peace and toward incorporating gender equality and women's human rights in the 
new aid methods. This partnership focuses on the role of women in conflict and post-
conflict  situations  and  more  particularly  on  the  good  application  of  United  Nations 
Security Council Resolution 1325. 

The Initiative for Peace Building, a project funded through the European Instrument 
for Democracy and Human Rights (EIDHR) and implemented by a network of civil 
society  organisations,  aims 
tools  and  resources  for 
policymakers  –  including  the  European  institutions  –  on  the  issue  of  women's 
protection  in  conflicts  and  the  role  of  women  in  the  promotion  of  peace  and 
international security. 

to  develop  analytical 

Awareness-raising,  exchanges  of  good  practice,  and  qualification  of  Commission 
staff  in  mainstreaming  gender  issues  in  programmes  and  projects  were  continued 
through training and by the creation of a network of gender focal points throughout 
the Commission's Delegations. Capacity building activities will continue in 2008. 

Statistical  capacity  building  activities  were  supported  so  as  to  enable  countries  to 
provide  accurate  information  for  monitoring  progress  and  measuring  the  impact  of 
development actions. Gender-disaggregated statistics are consistently recommended 
in  order  to  increase  understanding  of  women's  and  men's  roles  in  maintaining  the 
three pillars, economic, social and environmental, of sustainable development and to 
develop appropriate policy responses. 

Children 

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In  accordance  with  the  European  Consensus  on  Development,  all  Commission 
external  assistance  programmes  and  projects  must  take  children's  rights  into 
consideration.  This  approach  is  beginning  to  show  its  fruits  and  will  have  positive 
effects  in  the  long  run.  Several  country  strategy  papers  adopted  in  2007  show  real 
inclusion of children's rights in how activities and target populations are addressed. 

In  addition,  the  Commission  entered  into  a  partnership  with  UNICEF  to  prepare  a 
"comprehensive toolkit to address child rights in European development cooperation 
and  external  relations"  (see  point  2.3  below).  This  toolkit  aims  to  help  all 
stakeholders  (including  Commission  staff)  directly  or  indirectly  concerned  with 
children's  rights  and  needs,  to  address  and  mainstream  these  in  programming  and 
project implementation. 

Social cohesion and employment 

The importance of employment for a more integrated way of reaching the MDGs was 
expressed  in  the  Millennium  Declaration  of  the  2005  World  Summit,  where  a  UN 
inter-agency group proposed appropriate indicators for a new target “[to] achieve full 
and  productive  employment  and  decent  work  for  all,  including  women  and  young 
people”  under  MDG  1  (Eradicate  extreme  poverty  and  hunger).  Since  then,  in 
addition  to  promoting  employment  directly,  there  is  a  substantial  and  increased 
international acknowledgment of the need to step up efforts to promote employment 
as a cross-cutting  issue in other areas of development  aid  (such  as education, post-
conflict reconstruction, rural development, and so on). 

A  Staff  Working  Document  entitled  Promoting  Employment 
through  EU 
Development  Cooperation  was  approved  in  April.  The  document  underscores  the 
importance of promoting full and productive employment and decent work for all – 
with a focus on youth and women so as to avoid increasing the gap between the rich 
and  the  poor.  The  Staff  Working  Document  proposes  to  increase  EU  support  to 
developing countries in their efforts to implement the decent work  agenda. Priority 
should be given toward creating new productive jobs in the formal economy as well 
as toward improving the living and working conditions in the informal economy. The 
paper also serves as a trigger for a broader debate with EU Member States on how 
best  to  promote  employment  through  development  policies  within  the  overall 
framework  of  the  Decent  Work  Agenda.  The  outcomes  should  be  reflected  in  the 
programming of EU aid. 

To facilitate the mainstreaming of employment, social protection and decent work in 
external cooperation, the Commission has organised thematic regional seminars with 
Commission  Delegations  and  ILO  local  offices  since  2006.  Latin  America  was  the 
focus of the 2007 joint seminar. These seminars aim to implement the joint strategic 
partnership  at  local  level,  to  improve  mutual  understanding,  cooperation,  synergies 
and contacts. 

Environment 

In the programming  of  the new generation of country and regional strategy papers, 
environmental  integration  efforts  were  directed  toward  gaining  attention  to 
environmental  protection  and  sustainable  natural  resources  management  both 
through specific actions within the intervention sectors and as a cross-cutting theme. 

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Emphasis was put on the preparation of country environmental profiles and the use 
of  strategic  environmental  assessments  as  a  means  to  integrate  environmental 
sustainability as well as climate change concerns in sector policies and programmes 
and large plans. 

Public consultations were held on the key elements and priorities of a possible EU- 
wide  strategy  in  this  area,  building  on  the  2001  integration  strategy  as  well  as 
addressing  new  challenges.  The  methodological  approach  developed  in  the 
Commission's  environmental  integration  handbook  was  shared  with  EU  Member 
States.  Meetings  were  also  held  with  Member  States  and  development  partners 
during the first part of the year to discuss progress on the environmental dimension 
of the 10th EDF. 

Activities  in  the  area  of  capacity-building  and  awareness  raising  continued. 
Environmental  integration  seminars  and  online  training  reached  a  total  of  over  300 
staff, quite evenly split between the Commission and relevant institutions of partner 
countries.  Awareness-raising  talks  for  Commission  staff  and  the  wider  public 
focused on issues such as deforestation avoidance, ecological footprint mapping, and 
sustainable  consumption  and  production.  Providing  Commission  Delegations  with 
relevant  knowledge  on  environmental  issues,  such  as  climate  change,  is  crucial  to 
enable Commission staff in the field to engage in dialogue with partner countries to 
explain the position of the EU and ensure that mitigation and adaptation approaches 
are  appropriately  considered  in  economic  development  and  poverty  reduction 
strategies.  Consequently,  engaging  Delegations  on  climate  change  and  other 
environmental issues will continue to intensify in 2008. 

1.6. 

Aid effectiveness and co-financing 

Aid effectiveness 

The  EU  is  preparing  for  the  mid-term  review  of  the  Paris  Declaration  in  the  third 
High Level Forum that will take place in Accra in September 2008. 

The Paris Declaration on Aid Effectiveness advances 12 commitments which are to 
be  implemented  before  the  end  of  2010.  Additionally,  the  EU  (Member  States  and 
Commission)  signed  up  to  four  additional  ambitious  objectives,  both  as  individual 
donors  and  as  collective  group.  The  EU  targets  were  stated  in  the  European 
Consensus and were reconfirmed by the Commission and Member States in Council 
Conclusions in April 2006 and November 2007. 

The  EU  additional  targets  are  to:  (i)  provide  capacity-building  assistance  through 
coordinated  programmes  with  an  increasing  use  of  multi-donors  arrangements;  (ii) 
channel  50%  of  government–to-government  assistance  through  country  systems, 
including by increasing the percentage of assistance provided through budget support 
or  swap  arrangements;  (iii)  avoid  the  establishment  of  new  project  implementation 
units; and (iv) reduce the number of uncoordinated missions by 50%. 

With  respect  to  the  four  additional  EU  targets,  the  Commission  has  adopted  two 
strategies:  one  for  increasing  the  use  of  country  systems  and  the  other  for  joint 
missions.  The  process  has  started  for  the  development  of  strategies  for  coordinated 
technical  cooperation  and 
the  reduction  and  avoidance  of  parallel  project 
implementation units. 

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Monitoring progress 

Monitoring progress on both the Paris Declaration and the four EU additional targets 
is vital for ensuring transparency as well as identifying where progress is necessary. 
According to the Council Conclusions of 2006, the monitoring exercise on the four 
EU additional targets has to be conducted in the existing mechanisms which are the 
OECD/DAC system. 

The  2006  OECD  Survey  on  Monitoring  the  Paris  Declaration  provides  data 
calculated  on  the  basis  of  a  sample  of  34  partner  countries  and  is  considered  a 
baseline exercise. A second Survey to be conducted in 2008 will allow for measuring 
progress since the 2006 survey. This survey will cover more (emerging) donors, as 
well as more partner countries. 

Concrete steps facilitating the aid effectiveness agenda 

The adoption of the EU Code of Conduct on Complementarity and Division of Labour 
in Development Policy11, represents a landmark advance in the implementation of the 
EU's  promise  to  deliver  "more,  better  and  faster  aid".  Implementation  of  the  EU 
Code of Conduct is already taking place through consultations at field-level between 
Commission Delegations, EU Member States, partner countries and other donors. To 
facilitate the consultation process on the implementation of division of labour in the 
field, the Commission also organises regular technical seminars for Member States. 

The  EC's  Financial  Regulations  now  make  co-financing  with  Member  States 
possible, in particular in the form of fund managing and delegated cooperation. The 
Commission  is  preparing  a  Compendium  on  Best  Practices  in  Division  of  Labour 
with case studies of best practices from across the donor spectrum. The compendium 
will  also  identify  bottlenecks  and  drivers  of  division  of  labour,  and  will  attempt  to 
develop indicators for division of labour (i.e. a measure for the fragmentation of aid). 
A  study  on  EU  co-financing12  provides  information  on  “who’s  doing  what  with 
whom  and  how”  in  terms  of  co-financing  at  EU  level  and  identifies  key  lessons 
learned  from  bilateral,  EC  and  decentralised  co-financing  experiences  as  well  as 
determining possible future actions for developing a comprehensive EU strategy for 
co-financing. 

The Donor Atlas 200613 provides baseline data on states in situations of fragility for 
a  possible  discussion  among  the  international  community  on  cross-country 
complementarity in fragile situations. 

Timely  and  substantial  inputs  were  provided  into  the  pertinent  international 
processes,  promoting  the  coordination,  coherence  and  visibility  of  EU  and 
Commission positions in international organisations. This has been particular true for 
FAO  and  UNCCD,  institutions  which  have  been  through  a  reform  process  (to  be 
continued in 2008). 

11 
12 
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At the Council meeting on 15 May  
Study on EU co-financing, Sigrid Willibald, November 2007 
http://ec.europa.eu/development/icenter/repository/eu_donor_atlas_2006_en.pdf 

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To move the aid effectiveness agenda forward, it is equally important that it is dealt 
with  in  sectors  of  cooperation.  This  is  done  through  thematic  coordination 
mechanisms  and  platforms.  Progress  was  made,  particularly 
the  Rural 
Development  sector.  A  process  of  elaboration  of  specific  guidelines  on  Aid 
Effectiveness  was  launched  by  the  Global  Donor  Platform  on  Rural  Development 
during the Second EU Forum on Rural Development in Berlin in June. Other sectors 
where donor coordinating mechanisms exist/have been strengthened at an operational 
level  include  Agriculture,  in  particular  Agricultural  Research  for  Development  and 
Livestock. 

in 

Financing for development (the "Monterrey process") 

In  the  context  of  the  2002  Monterrey  International  Conference  on  Financing  for 
Development,  the  EU  (Commission  and  Member  States)  agreed  on  a  series  of 
thematic commitments. This was the first time the EU spoke with "one voice" in the 
area of development policy. The Council has mandated the Commission to monitor 
and  provide  annual  progress  reports  on  these  commitments.  Ownership  and 
confidence of EU Member States in this process is very high and in view of the UN 
World Summit in 2005 has led to agreement of additional commitments. 

The EC monitors the implementation of the following commitments: the scaling up 
of ODA (commitments 2010-2015); innovative sources of financing; debt relief; aid 
effectiveness;  more  predictable,  less  volatile  aid  mechanisms;  exogenous  shocks; 
untying  of  aid;  Global  Public  Goods;  reform  of  the  International  Financing 
Institutions; and trade and development. 

These  commitments  have  become  key  elements  of  the  European  Consensus  on 
Development.  Aid  effectiveness  and  aid  for  trade  have,  over  time,  developed  into 
almost independent strands (linked to the progress of work  in  the  OECD/DAC and 
WTO). The Council has repeatedly insisted on maintaining the link with Monterrey 
and  has  called  on  the  Commission  to  report  progress  on  aid  effectiveness  (i.e. 
division of labour) and aid for trade (i.e. EU aid for trade implementation strategy) in 
the context of the Monterrey report. 

The  "Monterrey  report  2007"  enabled  the  Commission  to  highlight  Europe's 
commitment  to  the  millions  of  people  afflicted  by  poverty,  as  most  Member  States 
met  or  exceeded  their  promises  for  2006.  It  also  showed  that  Europe  is  at  the 
forefront  in  the  development  of  innovative  sources  of  finance  for  development  and 
the aid effectiveness agenda. At the same time, the report allowed to place pressure 
on those Member States that are still struggling to fulfil commitments. In that sense, 
this monitoring exercise ensures that commitments are put in place by the Member 
States, moving Europe from rhetoric to reality in the arena of development policy. 

The "Monterrey report 2008" is being prepared as part of the Accra/Doha package to 
be  adopted  by  the  Commission  in  June  200814.  Replies  from  most  of  the  Member 
States  to  the  annual  questionnaire,  covering  all  commitments,  are  available.  The 
report  will  assess  progress  achieved  (ODA  to  Africa  and  support  for  new  debt 

14 

The  package  will  comprise  a  short  political  umbrella  Communication,  the  reports  on  financing  for 
development, aid effectiveness, aid for trade, and on policy coherence. 

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architecture), highlight drawbacks (decreasing ODA levels in 2007- 2008) and make 
proposals for a single EU line to take at Doha. 

Non-state actors and local authorities in development  

As reflected in the "European Consensus" and in several conclusions, resolutions and 
opinions,  civil  society  and  its  various  actors  play  a  key  role  as  promoters  of 
democracy, social justice and human rights. The EU recognises the vital contribution 
of non-state actors (NSA) by virtue of their dual role as strategic partners in political, 
social  and  economic  dialogue  and  key  aid  delivery  actors.  The  EU  promotes 
constructive  and  continuous  dialogue  with  all  types  of  non-state  actors  and  local 
authorities, which is essential to ensure integration of the priorities and concerns of 
stakeholders in development strategies and programmes, to strengthen their voice in 
the development process and to advance political, social and economic dialogue. 

Throughout  2007,  the  Commission  engaged  in  discussions  on  the  multi-annual 
strategy for the new thematic programme "Non State Actors and Local Authorities in 
Development"  which  replaces  the  former  budget  lines  "NGO  Co-financing"  and 
"Decentralised Cooperation". The strategy for 2007-2010 was approved by Member 
States  and  adopted  by  the  Commission  in  June  following  consultation  with  civil 
society  and  dialogue  with  the  European  Parliament.  Lessons  learned  and  policy 
evolution  as  regards  participatory  approaches  resulted  in  several  important 
innovations,  including  relaxing  eligibility  criteria  for  all  types  of  NSA  and  local 
authorities as well as stakeholders in partner countries. Furthermore, in the context of 
devolution and to ensure stakeholder participation in partner countries, Commission 
Delegations  will, 
in  future,  assume  greater  management  responsibility  for 
interventions  conducted  at  country  level,  including  launching  local  calls  for 
proposals. 

The  overarching  objective  of  the  programme  is  poverty  reduction  in  the  context  of 
sustainable  development,  including  pursuit  of  the  MDGs  and  other  internationally 
agreed  targets.  More  specifically,  the  programme  aims  to  (i)  promote  an  inclusive 
and  empowered  society  in  partner  countries  so  as  to  facilitate  stakeholder 
participation;  (ii)  raise  public  awareness  on  development  issues  and  promote 
in  Europe;  and  (iii)  support  coordination  and 
education  for  development 
communication  activities  of  NSA  and  local  authority  networks  in  Europe.  The 
Commission  adopts  annual  action  programmes  (AAP)  to  implement  this  strategy. 
The 2007 AAP was adopted in December following the approval of Member States. 
Subsequently, the first (local and central) call for proposals was launched. 

The  provisions  of  the  Cotonou  Agreement  have  facilitated  and  consolidated 
participatory  approaches  in  cooperation  with  ACP  countries.  The  revision  of  the 
Agreement in 2005 provided the opportunity to strengthen these provisions further, 
by  facilitating  NSA  access  to  funding  and  by  extending  the  provisions  on 
participatory  approaches  to  local  authorities.  Participation  of  NSA  and  local 
authorities  was  a  fundamental  principle  of  the  10th  EDF  programming  process  that 
occurred  throughout  2006  and  2007.  The  programming  guidelines  were  distributed 
widely and placed online to facilitate the participation of a broad range of actors. 

Progress  made  regarding  participation  of  NSA  and  local  authorities  in  policy 
dialogue is regularly assessed. In 2007, the Commission produced a summary report 

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on  the  experience  of  its  Delegations  with  consultation  of  stakeholders  in  the 
elaboration of country strategy papers under the 10th EDF. The results of the report 
are  mixed.  While  the  quality  of  participation  varied,  each  of  the  64  countries 
reviewed  engaged  in  dialogue  with  stakeholders.  Nevertheless,  in  several  cases, 
policy  dialogue  was  limited  to  information  rather  than  consultation.  Even  so,  the 
number of countries where thorough consultation of NSA has occurred has increased 
since the Mid Term Review of programming in 2004. The full report is available on 
the DG Development website on Europa. 

A  further  important  issue  in  2007  was  the  growing  momentum  across  the  board  to 
examine the role of civil society in the aid effectiveness agenda. Indeed, NSA have 
been  long  considered  the  "missing  link"  in  the  Paris  Agenda.  In  this  context,  the 
Commission  has  been  following  the  deliberations  of  an  "Advisory  Group"  (AG) 
established  by  the  Working  Party  on  Aid  Effectiveness  (WP-EFF)  to  develop 
concrete  recommendations  on  how  best  to  include  NSA  in  the  international 
discussions on aid effectiveness in the light of the HLF in Accra in September 2008. 

EU12  Member  States:  Capacity  Building  Scheme  for  Development  Policy 
(CBS III) 

During the second semester the Commission held bilateral discussions with each of 
the  MS-12  toward  initiating  and  launching  the  third  Capacity  Building  Scheme  for 
Development  Policy  (CBS III)  for  MS-12.  CBS  is  a  demand  driven  programme  to 
provide  training  and  technical  assistance  to MS-12  so  as  to  build  their  capacity  for 
development  cooperation  on  a  “just-in-time,  just-enough”  basis.  The  objective  of 
CBS III is to help the MS-12 capitalise on their recent achievements in development 
cooperation  undertaken  under  Capacity  Building  Schemes  I  and  II  and  to  take 
coherent steps ahead while paying particular attention to the fulfilment of obligations 
undertaken  at  the  EU  level.  This  programme  will  continue  from  CBS II  (albeit 
having  a  different  form  and  substance)  which  attained  its  final  phase.  Discussions 
with  MS-12  focused  on  their  needs  for  capacity  building  in  development  aid, 
modalities  of  implementation  and  operational  aspects  and  how  and  to  what  extent 
CBS III can satisfy these. 

1.7. 

Partnership with United Nations and World Bank 

United Nations 

Relations between the United Nations and the European Union have grown over time 
into  a  rich  and  diverse  network  of  contacts,  cooperation  and  dialogue  covering 
virtually all areas of the EU's external relations and spanning the entire scope of the 
UN  Charter,  from  peace,  security  and  human  rights  to  social  and  economic  affairs, 
including development and humanitarian activities and trade policy. 

The Commission, in line with the European Security Strategy (2003), is committed 
to  a  strong  UN  equipped  to  confront  global  issues  and  develop  global  solutions.  It 
supports UN reform and the implementation of the 2005 World Summit Outcome. In 
2007,  the  Commission  backed  UN  plans  to  promote  inter-agency  system-wide 
coherence, especially the launching of “Delivering as One” initiatives in eight pilot 
countries, and is considering the possible implications for its future cooperation with 
UN  Agencies,  Funds  and  Programmes.  In  the  spirit  of  system-wide  coherence,  the 

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UN  is  now  increasingly  practicing  inter-agency  cooperation  and  speaking  with  one 
voice on policy issues in its dealings with the European Union. 

This year, the focus of the whole international community was on climate change. In 
September,  the  UN  Secretary-General  organised  a  High-level  event  on  Climate 
Change  in  New  York  City,  and  the  year  ended  with  the  adoption  of  the  Bali 
Roadmap  at  the  UN  Climate  Change  Conference  in  December.  The  Commission 
participated  actively  in  both  events,  which  were  organised  together  with  the  EU 
Presidency.  The  European  Development  Days  sought  to  tackle  the  same  theme  by 
finding global and European solutions to the issues at hand while strongly promoting 
the relationship between development and climate change. 

2007 marked the mid-way point towards the 2015 target date for the MDGs. The UN 
Secretary-General launched the MDG Africa Steering Group with major multilateral 
and regional development partners to devise strategies and to prepare actions to bring 
sub-Saharan Africa, in particular, on track to meet the MDGs. President Barroso is a 
member  of  the  Steering  Group  and  the  Commission  actively  shared  its  experience 
and views in the Group. 

2007 was the first full year of operation of the new UN Peacebuilding Commission 
(PBC).  Together  with  other  EU  actors,  the  Commission  participated  in  its  work  on 
both  country-specific  and  thematic  issues.  The  PBC  adopted  integrated  peace-
building strategies for Burundi and Sierra Leone and agreed tracking and monitoring 
mechanisms  to  follow-up  on  their  implementation.  The  PBC  also  held  several 
debates  on  thematic  issues  of  horizontal  relevance  to  its  work  on  peace-building; 
such  as  strategic  frameworks  for  peace-building,  indicators  and  monitoring;  local 
governance  and  decentralization  in  post-conflict  settings;  regional  peace-building 
experiences;  budget  support  in  post-conflict  countries;  and  gender  and  peace-
building.  

The  Commission  continued  in  other  ways  to  participate  actively  in  UN  processes, 
together  with  EU  Member  States,  by  promoting  the  adoption  of  important 
development-related  resolutions  and  policy  documents  at  the  General  Assembly, 
ECOSOC and other UN bodies. As an example, representing the EC as a full FAO 
member, the Commission played a key role at the 34th session in November, which 
successfully set in motion the FAO reform process. 

The Commission continues to build a partnership with the UN system as a whole, as 
well as with individual UN entities, covering policy and normative work as well as 
operational  activities.  In  this  context,  several  high  level  meetings  between  the 
Commission  and  the  UN  took  place,  beginning  in  January  when  the  new  UN 
Secretary-General Ban Ki-moon made his first mission outside the USA to Brussels 
to meet the Commission and other EU Institutions. During the year, Commission-UN 
policy dialogues and meetings to review cooperation included sessions with the FAO 
in  March,  agreeing  upon  future  priorities  (climate  change,  statistics,  Africa);  the 
Office on Drugs and Crime (ODC) in May focusing on trafficking issues; the World 
Health  Organisation  (WHO),  in  both  June  and  October,  addressing  issues  such  as 
priorities  for  Africa,  health  funding,  social  determinants  of  health,  and  the  ILO  in 
November  especially  on  the  decent  work  agenda.  The  Commission  also  supported 
the work of the UN-led International Working Group on Sport for Development and 
Peace  (SDP  IWG).  In  an  effort  to  fully  use  the  potential  of  sport  for  development, 

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this  group  made  further  progress  in  engaging  with  national  governments  on  policy 
recommendations to support the integration of sport and physical activity into their 
national and international development strategies and programmes. The Commission 
gave its input to the final policy recommendations, which will be published in 2008 
to coincide with the Beijing Olympics. 

Finally  in  December,  there  was  a  high-level  meeting  to  review  the  Commission-
UNDP  strategic  partnership,  which  noted  joint  achievements  on  issues  such  as 
electoral  assistance  and  conflict  and  disaster  needs  assessments.  The  meeting  also 
identified areas of mutual interest for 2008-2011: electoral assistance, strengthening 
of  parliamentary  systems,  justice  and  security  sector  reform  (SSR),  disarmament, 
demobilisation  and  reintegration  (DDR),  harmonization  of  governance  indicators, 
fragile  situations,  post-conflict  and  post-disaster  needs  assessment  and  climate 
change. 

Cooperation  also  continues  with  other  UN  entities  such  as  UNICEF,  on  children’s 
rights and protection, and MDG indicators; or UNIFEM, with which a Partnership on 
Gender Equality for Development and Peace was agreed. 

International Financial Institutions 

The  Commission  has  reinforced  its  policy  dialogue  with  the  international  financial 
institutions  (IFIs),  particularly  with  the  World  Bank,  the  International  Monetary 
Fund (IMF) and the regional development banks. 

World Bank and International Monetary Fund 

The fourth High Level "Limelette" Meeting between the European Commission and 
the  World  Bank  on  their  cooperation  in  Africa  was  held  on  17-18th  September  in 
Brussels,  in  the  framework  of  the  so-called  'Limelette  cooperation  process'.  This 
process,  which  started 
together  senior 
management and field officers of the two institutions for a candid policy dialogue on 
how  to  better  coordinate  and  harmonise  Commission  and  World  Bank  policies  in 
Africa. During this meeting, joint action plans were agreed. 

in  Limelette,  near  Brussels,  brings 

Policy dialogues took place with the World Bank and the IMF in the regions of the 
candidate  or  potential  candidate  countries,  the  Eastern  Neighbourhood  and  Central 
Asia, as well as in the Mediterranean region. This cooperation takes place under the 
umbrella  of  a  Memorandum  of  Understanding  for  each  of  these  three  regions. 
Following  an  EU-IFIs  annual  consultation  in  April  focusing  on  Neighbourhood 
strategies  and  programming  for  the  European  Neighbourhood  and  Partnership 
Instrument,  the  World  Bank  offered  concrete  proposals  to  strengthen  cooperation 
between  its  country  strategies  and  EU  action  plans.  In  addition  it  was  agreed  to 
pursue joint work on public finance management indicators in selected neighbouring 
countries. In summer, the International Finance Corporation (IFC) joined the existing 
EU-IFIs Memorandum of Understanding for the Mediterranean region. The Council 
of  Europe  Development  Bank  became  a  signatory  of  the  EU-IFIs  memorandum  of 
Understanding on NIS. Within the framework of the IFIs' Advisory Group created in 
2007,  operational  coordination  also  started  between  the  new  IPA  instrument  for 
potential  candidate  and  candidate  countries  in  the  Balkans  and  the  IFIs'  supportive 

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operations  in  the  region.  In  the  case  of  Kosovo's  final  status  settlement  process, 
specific operational cooperation also took place. 

Another kind of relationship between the Commission and the World Bank consists 
of  European  coordination  among  the  European  Union  members  of  the  Board  of 
Directors  of  the  WB  (EU  EDs)  and  the  Commission.  One  way  in  which  the 
Commission reinforces this coordination is by organising an annual visit by the EU 
EDs to the European Institutions in Brussels. The group paid their fourth visit to the 
European  Institutions  in  Brussels  on  February  5-6.  They  met  Commissioners  from 
the External Relations Group, as well as NGOs and the Parliament. In addition to the 
annual  visit,  the  Commission  encourages  the  adoption  of  common  European 
positions by the EU EDs on items to be discussed within the World Bank Board by 
transmitting Commission positions whenever possible on these items for discussion 
at  the  weekly  coordination  meetings  in  Washington,  DC  between  the  EU  EDs  and 
the  Commission  Delegation.  The  EU  EDs  presented  more  than  thirty  common 
statements to the Board in 2007, continuing its practice of previous years. 

The  bi-annual  ministerial  joint  World  Bank/IMF  Spring  and  Annual  Meetings  took 
place  respectively  on  14-15  April  and  on  20-22  October  in  Washington,  DC.  The 
main  topics  discussed  between  the  Commission  and  the  World  Bank  were 
governance reforms, the strategic direction of the World Bank Group, climate change 
(a  new  Global  Climate  Financing  mechanism  is  being  developed),  and  Middle 
Income  Countries.  Commissioner  Michel  addressed  the  Ministerial  Development 
Committee on both occasions, while Commissioner Almunia attended the Ministerial 
IMFC. The Commission has an observer status in both meetings. 

Finally,  bilateral  high  level  policy  discussion  took  place  between  the  Commission 
and the World Bank/IMF. Mr. Zoellick paid an orientation visit to the Commission 
on 12 June before his appointment as WB President and met Commissioner Michel 
again in November in Brussels. Mr Strauss-Kahn was elected by the Executive Board 
in September as the new Managing Director of the IMF, replacing Mr. de Rato, who 
stepped down after the IMF Annual Meeting. 

Regional Development Banks 

On  January  25-26,  a  high  level  meeting  was  held  for  the  first  time  in  Brussels 
between the EU Executive Directors (EU EDs) of the Regional Development banks 
(Inter-American,  African,  and  Asian  Development  Banks)  and  Commission  Senior 
Management.  This  meeting  had  the  same  format  as  the  meeting  between  the 
Commission  and  the  EU  EDs  at  the  World  Bank  mentioned  above.  European 
coordination  among  EU  Directors  in  the  Boards  of  regional  development  banks  is 
only in an early stage. 

The  Commission  launched  a  reinforced  cooperation  process  with  the  African 
Development  Bank  (AfDB)  this  year  by  organising  a  High-Level  meeting  between 
the  senior  management  of  the  Commission  and  the  AfDB  which  was  held  on  3-4 
September  in  Brussels  during  which  an  action  plan  was  agreed  between  the  two 
institutions  (similar  to  the  existing  EC-WB  Limelette  meetings  mentioned  above). 
The  2007  edition  of  the  African  Economic  Outlook  (AEO)  was  managed  by  the 
OECD,  but  the  AfDB  assumed  the  lead  in  2007  for  future  editions.  The  AEO  is  a 
valuable compendium on the economic and social development statistics of African 

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countries. Indeed, the AEO is widely used by practitioners in various organisations. 
The  Commission  has  financially  supported  the  publication  of  the  AEO  in  previous 
years and decided in December to contribute financially to the next two editions. 

Regarding 
the  Interamerican  Development  Bank,  a  new  Memorandum  of 
Understanding  (MoU)  was  prepared  and  signed  for  the  period  2007-2011.  The 
MoU's  main  priorities  are  in  the  areas  of  social  cohesion,  regional  integration, 
climate  change,  renewable  energy  and  statistics.  With  regard  to  the  Asian 
Development  Bank  (ADB),  a  Memorandum  of  Understanding  was  signed  on 
cooperation with Eastern Europe and Central Asia leading to annual consultations on 
strategies and programmes. 

1.8. 

Poverty focus in middle-income countries15 

The Commission is active in more than 80 Middle Income Countries (MIC). These 
countries are the home to over 50% of the developing world’s population of which 
around a billion have an income of less than two US dollars a day. 

In  these  countries  the  Commission  pursues  a  mix  of  external  actions.  The  EC's 
commitment  to  eradicating  poverty  and  promoting  sustainable  development, 
including the pursuit of the MDGs has traditionally been, and remains, dominant in 
Asia and Latin America, where many people are excluded from the benefits of rapid 
economic  growth  and  where  the  income  distribution  gap  remains  high,  leading  to 
social  exclusion  and  inequality.  In  these  countries,  in  view  of  the  existence  of 
relatively developed social and economic institutions and structures, the Commission 
promotes the achievement of poverty reduction and sustainable development across a 
broad front of possible interventions. These include support to sectors such as trade, 
regional  integration,  agriculture,  environment,  climate  change,  security,  migration, 
the  social  dimension  of  globalisation,  employment  and  decent  work,  and 
international  scientific  cooperation, 
including  health  research.  The  mix  of 
interventions in each country is determined by national conditions and priorities, in 
accordance with the Development Cooperation Instrument (DCI) which became the 
main funding mechanism for assistance to Asia and Latin America upon its entry into 
force  on  1  January.  EC  assistance  to  enlargement  countries  and  to  countries  in  the 
'Neighbourhood' region, while based on promoting sustainable social and economic 
development,  also  aims  to  strengthen  mutually  beneficial  ties  with  the  EU,  as 
established 
the  European  Neighbourhood  Policy  Instrument  (ENPI)  and 
Instrument  for  Pre-accession  Assistance  (IPA),  which  also  came  into  effect  on  1 
January.  In  addition,  action  is  taken  to  respond  to  crisis,  reconstruction  and 
rehabilitation needs in countries such as Iraq. In assisting these countries, the needs 
of the poorest communities are also addressed. In Latin America, with the exception 
of Nicaragua, all countries are MIC. Each of these countries will receive around €100 
million  of  aid  annually,  during  the  period  2007-2010.  Progress  made  in  economic 
reform and social policies has led to a slight reduction in poverty levels in the MIC. 
However, absolute poverty remains high, affecting 40% of the population, according 
to the latest UN estimates. Latin America is the most unequal region of the world in 
terms  of  income  distribution  and  this  situation  is  not  improving  substantially. 
Accordingly, EU programmes provide support to fight poverty and promote reforms. 

in 

15 

The  definition  of  Middle  Income  Countries  used  here  is  that  of  World  Bank  List  of  Economies 
http://siteresources.worldbank.org/DATASTATISTICS/Resources/CLASS.XLS 

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Key  EU  strategies  towards  MIC  in  Latin  America  include  support  to  regional 
integration,  the  promotion  of  social  cohesion,  and  increasing  trade  links  and  other 
business  opportunities  between  Latin  America  and  Europe.  All  these  EU  strategies 
are  expected  to  raise  personal  incomes  and  reduce  inequality.  EU  policy  dialogue 
with partner countries and their regional groupings has been broadened recently, to 
include competitiveness, migration, governance and environment, energy and climate 
change-related issues. 

During the 2007-2010 period, Middle Income Countries (MIC), which represent 11 
countries in Asia, are expected to receive an average of €290  million per year of EC 
programmable cooperation, representing approximately 35% of total EC cooperation 
allocated  to  Asia.  In  line  with  a  differentiated  and  flexible  approach,  EC 
development  cooperation  has  adapted  to  different  needs  and  specific  conditions. 
Social  and  economic  progress  has  been  registered  in  Asian  MIC  countries  as 
expressed  by  the  general  steep  reduction  in  levels  of  poverty,  sometimes  on  an 
impressive scale as in China. However the absolute number of poor people remains 
very high and income disparities have been widening. The EU has also supported the 
regional  integration  process  through  its  support  to  ASEAN  in  particular.  Policy 
dialogues, both at bilateral and at regional level, have acquired a growing relevance 
in  different  fields  including  economic  issues,  environment/energy/climate  change 
and dialogues with civil society. 

All countries in the ENPI Eastern Region are now classified as MIC. While poverty 
in the region has been reduced, social inequality and exclusion are still increasing at 
country and regional level. Introducing ENPI and increasing assistance in the form of 
sector  budget  support  add  to  the  efficiency  of  the  EC  assistance;  however  regional 
needs remain significant. Despite being reclassified as a low-MIC, Moldova remains 
the  poorest  country  in  Europe.  Thus,  poverty  reduction  is  central  to  the  Moldovan 
Government’s  economic  growth  and  poverty  reduction  strategy,  its  National 
Development  Plan,  and  to  the  EC’s  assistance  under  ENPI.  The  Southern 
Mediterranean  region  also  has  to  deal  with  the  problem  of  poverty;  however, 
societies  in  this  region,  usually  based  upon  religious  values  of  solidarity,  are  more 
redistributive  and  the  percentage  of  citizens  living  in  poverty  is  smaller  than  the 
global  average.  EC  assistance  through  ENPI  focuses  on  support  to  administrative, 
economic  and  social  reforms,  strengthening  institutions  and  mitigating  the  social 
effects of the transition process. The sustainability of socio-economic development is 
often  included  as  the  priority  for  EC  assistance.  However,  coherent  national 
strategies and commitment to reform in this area are needed. 

1.9. 

Sectoral policy / strategy developments 

Human and social development 

A  thematic  strategy  for  human  and  social  development,  Investing  in  People,  was 
adopted  on  10  May16  for  the  period  2007–2013.  Driven  by  the  ambition  to  help 
partner countries to achieve the MDGs, and with an overall budget of €1.06 billion in 
2007-2013, the strategy proposes to support activities under four main pillars: good 
health for all, education, knowledge and skills, gender equality, and other aspects of 

16 

C/2007/1957 

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human  and  social  development  (including  social  cohesion,  employment,  decent 
work, children and youth, and culture). 

To  promote  the  development  of  skills,  knowledge  and  quality  higher  education,  an 
Erasmus Mundus External Cooperation Window was launched in 2007 (based on the 
success  of  the  2006  call  for  proposals).  This  window  is  complementary  to  and  in 
synergy  with  the  Erasmus  Mundus  programme  and  promotes  cooperation  between 
higher education institutions and the mobility of students, researchers and academic 
staff  between  the  EU  and  third  countries.  The  Erasmus  Mundus  External 
Cooperation  Window  call  for  proposals  published  in  2007  (for  the  academic  year 
2008-2009)  promotes  both  academic  cooperation  and  mobility  of  students, 
researchers and academic staff of the EU and participating ENP countries. Likewise, 
the  Tempus  programme  continues  to  contribute  to  the  creation  of  an  area  of 
cooperation  in  the  field  of  higher  education  for  the  period  2007-201317.  Tempus 
supports  the  modernisation  of  higher  education  in  partner  countries  in  the  Western 
Balkans,  Eastern  Europe  and  Central  Asia,  North  Africa  and  the  Middle  East.  It 
promotes both the voluntary convergence with EU developments in higher education, 
deriving from the Lisbon Strategy to create more jobs and growth, and the Bologna 
Process to establish a European Area of Higher Education. 

Working  together  with  Member  States  and  other  donors  and  stakeholders,  the 
Commission  played  an  increasingly  central  and  influential  role  internationally  in 
education and health. In collaboration with the World Bank and the UK Government 
to  mobilise  political  commitment  to  deliver  on  promises  on  education,  in  May,  the 
Commission  organised  a  high  level  education  event  Keeping  Our  Promises  on 
Education.  As  in  previous  years,  the  Commission  played  a  key  role  in  the  'Global 
Fund  to  fight  HIV/AIDS,  Tuberculosis  and  Malaria'  (GFATM)  to  which  the  EC 
contributed €100  million in 2007 alone. Total EC contributions have reached €622.5 
million over the last 6 years. From May 2006 until April 2007, the Commission held 
the position of Vice-Chair of the Board of the GFATM. From July 2006 to June 2007 
the Commission was also Co-Chair of the 'Education for All – Fast Track Initiative' 
(FTI)  and  focused  during  its  chairmanship  on  promoting  donor  harmonisation  and 
aid  effectiveness  as  well  as  on  improving  the  quality  assurance  of  the  processes  of 
the  Initiative.  The  financial  contribution  to  these  global  initiatives  on  health  and 
education  is  part  of  the  Commission's  political  commitment  of  supporting  social 
sectors under the DCI. 

Furthermore,  the  Commission  worked  with  the  G8  Presidency  and  European  G8 
members to maintain a strong commitment of the G8 to scaling up efforts to combat 
HIV/AIDS,  tuberculosis  and  malaria  and  to  strengthen  health  systems.  A  policy 
initiative,  conceptualised  by  the  Commission  Delegations,  was  launched,  in  the 
context of the European Programme for Action to Confront HIV/AIDS, Malaria and 
Tuberculosis  through  External  Action  (2007-2011)18,  to  strengthen  the  response  to 
the  HIV/AIDS  crisis  in  Southern  Africa.  On  1  December,  the  Commission 
collaborated  with  the  EU  Presidency  and  Member  States  on  the  EU  Statement 
Keeping the Promises to Stop HIV/AIDS for World AIDS Day. 

17 
18 

http://ec.europa.eu/ tempus/ 
COM(2005)179 final 

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A 
joint  Communication  of  Directorate  Generals  Education  and  Culture, 
Development and External Relations on Culture European Agenda for Culture in a 
globalizing world was adopted in May19. This document highlights the role of culture 
in Europe and in  EU  external  relations and  proposes  objectives  for a new common 
EU  agenda  for  culture.  On  the  one  hand,  the  paper  recommends  a  twin  track 
approach  that  systematically  integrates  the  cultural  aspect  in  all  external  policies, 
projects and programmes, while enhancing the sustainability of our actions through 
better  understanding  of  the  cultural  context  of  our  partner  countries.  On  the  other 
hand, the paper proposes to fund cultural actions that contribute to the preservation 
of  cultural  heritage  as  well  as  to  the  emergence  of  viable  cultural  industries.  The 
Communication aspires to set up an EU-ACP cultural fund for the strengthening of 
distribution and production of ACP cultural goods and services. 

Agriculture 

The  Commission  has  enhanced  its  engagement  in  agricultural  development  with 
African  institutions,  particularly  the  African  Union  Commission  (AUC)  and  its 
specialised  agencies,  the  NEPAD  Secretariat  and  other  organisations  at  the 
continental and regional levels. Areas of involvement include land policy, veterinary 
disease  control  (including  avian  flu),  sanitary  and  phyto-sanitary  standards, 
agricultural  research,  natural  resource  management  and  early  warning  systems  for 
food  security.  On  24  July,  the  Commission  adopted  a  Communication  Advancing 
African  Agriculture20.  As  confirmed  by  the  Council  Conclusions  adopted  on  20 
November, the EU will support agricultural development in Africa in the framework 
of a long-term cooperation with the African organisations at regional and continental 
level  that  are  coordinating  the  Comprehensive  African  Agricultural  Development 
Programme (CAADP). This support, based on seven priorities aims to reinforce the 
sector growth, namely through improving agricultural policies and governance. The 
Commission  also  organised,  with  the  German  Presidency,  the  second  European 
Forum on Sustainable Rural Development in Berlin from 18 to 21 June. The theme 
was "Sustainable growth and poverty reduction in rural Africa: how can Europe be a 
more effective partner?" 

The  Commission  continued  its  work  on  implementation  of  the  2004  EU  Land 
Guidelines21, continuing its dialogue with major actors such as the AUC, the World 
Bank,  FAO  (particularly  within  the  International  Conference  on  Agrarian  Reform 
and  Rural  Development  –  ICARRD),  the  International  Land  Coalition  and  the 
Commission for the Legal Empowerment of the Poor. In 2007, the Commission fully 
restored  its  partnership  with  the  Consultative  Group  on  International  Agricultural 
Research (CGIAR) and strengthened its cooperation with IFAD. 

In  the  context  of  the  accompanying  measures  for  Sugar  Protocol  countries, 
established to cushion the impact of the reform of the EU sugar regime, on 18 April 
the Commission decided on the indicative allocation of the available budget between 
eligible  countries.  It  also  adopted  support  strategies  for  the  last  five  of  eighteen 
countries  concerned,  and  proceeded  with  the  implementation  of  its  support  for  the 
others. 

19 
20 
21 

COM(2007)242 final 
COM(2007)440 final 
http://ec.europa.eu/development/icenter/repository/EU_Land_Guidelines_Final_12_2004_en.pdf 

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Food security 

On 4 May the Commission adopted the food security thematic strategy and its multi-
annual  indicative  programme  2007-2010.  This  strategy  plays  a  central  role  in  the 
implementation of EC food security policy which complements the humanitarian and 
the  geographical  approaches,  in  crisis  situations  and  in  development  contexts 
respectively.  The  thematic  strategy  aims  to  reduce  food  insecurity  worldwide  by 
improving the livelihoods of the rural and urban poor and of the most disadvantaged 
groups. The programme is intended to work with a range of different public and non-
governmental partners, and will support: (i) the delivery of international public goods 
contributing  directly  to  food  security  (e.g.  agricultural  research,  food  security 
information systems, trans-regional and continental initiatives, etc); (ii) food security 
in situations of post-crisis transition and in fragile states; and (iii) innovative policies 
and  strategies  in  the  field  of  food  security  (pilot  projects,  support  to  civil  society 
initiatives promoting South-South and North-South dialogue on food security). 

Environment 

On desertification the Commission actively contributed to the preparatory work, and 
the adoption at the 8th Session of the UNCCD Conference of the Parties (CoP-8) in 
September  2007  in  Madrid,  of  the  UN  Convention  to  Combat  Desertification 
(UNCCD) progressive reform package. The Ten-Year Strategic Plan and Framework 
to  Enhance  the  Implementation  of  the  UNCCD  establishes  the  principles  for  a 
streamlined  and  consistent  operational  structure  for  the  UNCCD  with  clearer  roles 
for  the  various  institutions  and  bodies,  timely  management  tools  and  results  based 
management allowing matching of resources to objectives and deliverables. 

As  the  2001  Environment  Integration  Strategy  was  due  for  review,  and  also  in 
response  to  the  Special  Report  of  the  Court  of  Auditors  on  the  Commission's 
performance  in  the  area  of  environment  in  development,  an  inter-service  group  on 
environmental 
in  development  cooperation  was  created.  Public 
consultations  were  held  on  the  key  elements  and  priorities  of  a  possible  EU-wide 
strategy in this area. Meetings were also held with Member States and development 
partners  during  the  first  part  of  the  year  to  discuss  progress  on  the  environmental 
dimension in the 10th EDF. 

integration 

On 20 June, the Commission adopted the thematic strategy for the environment and 
sustainable  management  of  natural  resources,  including  energy  (ENRTP)  and  its 
multi-annual  indicative  programme  2007-2010.  This  strategy  aims  to  integrate 
environmental protection requirements into the EC's development and other external 
policies as well as to help promote its environmental and energy policies abroad in 
the common interest of the EU and partner countries and regions. It includes two new 
initiatives  related  to  climate  change  and  renewable  energy;  the  Global  Climate 
Change Alliance (GCCA), and the Global Energy Efficiency and Renewable Energy 
Fund  (GEEREF).  The  strategy  addresses  challenges  that  have  a  profound  effect  on 
the  lives  of  poor  people,  in  particular  rapidly  degrading  key  ecosystems,  climate 
change,  poor  global  environmental  governance  and  inadequate  access  to  (and 
security  of)  energy  supply.  It  is  characterised  by  flexibility  in  the  choice  of 
implementing partners, allowing partnerships with, among others, community-based 
organisations,  research  organisations,  civil  society,  the  private  and  financial  sectors 
and international bodies and organisations. 

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In September, the Commission issued the Communication Building a Global Climate 
Change Alliance between the EU and poor developing countries most vulnerable to 
climate change. The GCCA aims to deepen dialogue that adds to a shared vision for 
a  post-2012  UN  climate  change  agreement,  exchange  of  experience,  and  the 
advancement  of  concrete  cooperation  on  climate  change  adaptation  and  mitigation 
between  the  EU  and  the  most  vulnerable  countries,  in  particular  Least  Developed 
Countries  (LDCs)  and  Small  Island  Developing  States  (SIDS).  The  European 
Development  Days  in  Lisbon  (7-9  November)  were  a  first  occasion  for  the  EU  to 
present this initiative.22 

The EU Action Plan for Forest Law Enforcement, Governance and Trade (FLEGT) 
is the European Union's response to illegal logging and associated trade. The Action 
Plan proposes voluntary partnership agreements (VPA) between producing countries 
and the EU. These VPA are legally binding agreements by which the partner country 
and  the  EU  commit  to  work  together  to  promote  better  forest  governance,  law 
enforcement  and  implement  a  timber  licensing  scheme.  In  2007,  Indonesia, 
Malaysia,  Ghana  and  Cameroon  formally  started  negotiating  with  the  Commission 
on a VPA. Congo, Central African Republic, Gabon, Liberia have indicated they are 
keen  to  enter  into  a  partnership  agreement  and  are  now  preparing  for  this.  The 
Commission,  together  with  Member  States,  has  responded  favourably  to  these 
requests and is actively supporting the consultative and policy processes at national 
level. 

Infrastructure 

The  EU-Africa  Partnership  on  Infrastructure  was  launched  by  the  AUC  and  the 
European  Commission  at  the  African  Union  Headquarters  in  Addis  Abba  on  24 
October. The main focus of the Partnership is trans-boundary, regional and national 
infrastructure: transport, water and energy infrastructure as well as ICT networks. By 
facilitating  continental  interconnectivity  and  strengthening  regional  networks,  the 
partnership is a coordinated EU response to NEPAD’s Infrastructure Action Plan and 
Africa’s goals of regional integration, economic growth, and increased trade to reach 
the MDGs. 

Strong  stakeholder  commitment  at  the  launch  of  the  partnership  resulted  from  a 
closer  dialogue  between  the  European  Commission,  the  AUC  and  the  Regional 
Economic  Communities,  which  serves  as  a  sound  foundation  for  advancing  the 
coordination  and  alignment  of  infrastructure  policies  and  strategies  at  a  continental 
and regional level. Policy development within the partnership is led by the AUC and 
strongly  supported  by  the  European  Commission  in  terms  of  capacity  building  and 
skills  enhancement.  In  support  of  interconnectivity,  start-up  funding  is  provided  to 
develop continental priorities and infrastructure corridors and networks. 

Working  within  the  integrated  framework  of  the  partnership  has  enabled  the 
European  Commission  to  foster  linkages  between  the  programming  of  10th  EDF 
national and regional programmes and the objectives of the EU Infrastructure Trust 
Fund,  administered  by  the  European  Investment  Bank.  This  innovative  trust  fund 
blends  grants  and  loans,  which  leverages  additional  finance  for  infrastructure.  The 

22 

For details, see feature article Climate Change in Development and External Assistance 

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approach  has  strengthened  dialogue  with  EU  Member  States  and  European 
development financial institutions, facilitating coordinated efforts to scale up aid to 
African infrastructure. 

Water and sanitation 

The policy focus in water and sanitation has been principally to enhance coordination 
between the Commission and the Member States. Following an independent review 
of  the  EU  Water  Initiative  (EUWI),  a  multi-stakeholder  platform  to  catalyse 
coordinated EU support for water and sanitation, new measures are producing better 
coordination at headquarters and at country level, and more effective streamlining of 
EC and Member State activities. The African component of EUWI has developed a 
constructive dialogue between the African Ministerial Council on Water and the EU 
on  the  African-EU  Strategic  Partnership  on  Water  Affairs  and  Sanitation,  a 
Partnership signed by Heads of State in 2002. 

Increased  efforts  to  maintain  the  national  policy  dialogues  in  Ethiopia,  Congo 
Brazzaville and the Central African Republic produced improved coherence between 
water  and  growth  and  poverty  reduction  strategies.  The  EUWI  Finance  Working 
Group  focused  on  capacity  building  and  methodologies  for  developing  sector 
financing  strategies.  Support  to  transboundary  water  management  was  enhanced 
through  activities  supported  by  the  ACP-EU  Water  Facility  and  through  the  EU-
Africa  Partnership  on  Infrastructure.  Within  the  Partnership,  the  water  component 
focused on river basins prioritised by NEPAD in its 2005 Infrastructure Action Plan 
for  Transboundary  Water  Management  (Niger,  Senegal,  Congo,  Lake  Chad,  Nile, 
Okavango and Zambezi) and on expanding support for other basins. Support covers 
the establishing and developing of basin authorities, capacity building as a necessary 
foundation  for  sustainable  infrastructure  development  and  contributing  to  project 
preparation  and  implementation.  The  Latin  American  component  of  the  EUWI  is 
taking  shape  with  the  continued  implementation  of  water  development  projects  as 
well  as  international  research  collaborations  addressing  the  systems  and  basin 
management aspects. 

Energy 

Energy access, energy security and concerns on climate change are the central policy 
challenges.  The  Commission  increased  its  efforts  to  enhance  coordination  and 
synergies in the energy sector and the concerns on climate change – as demonstrated 
during  the  European  Development  Days  conference  held  in  Lisbon  in  November. 
These efforts were supported by the Council Conclusions of 14 May and the launch 
of  the  Africa-EU  Energy  Partnership  at  the  Lisbon  Summit  in  December. 
Consequently,  the  EU  Energy  Initiative  is  becoming  a  strengthened  platform  for 
better  coordination  and  more  streamlined  EU  Member  State  and  EC  support  to  the 
sector.  Similarly,  an  enhanced  dialogue  with  the  AUC  and  the  Forum  of  Energy 
Ministers of Africa (FEMA) produced an Action Plan for 2008-2010 for the Energy 
Partnership. 

EC  support  to  energy  has  increased  with  its  inclusion  as  a  priority  area  in  the  EU 
development  policy  (the  European  Consensus),  and  the  awareness  created  by  the 
ACP-EU  Energy  Facility  as  well  as  the  energy  component  of  the  EU-Africa 
Partnership on Infrastructure. Energy is a development sector in 16 countries of the 

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10th EDF Indicative Programmes, half being in Africa. Additional support to energy 
is included in the thematic programme on environment and sustainable management 
of natural resources, including energy (ENTRP). 

Transport 

Policy  and  strategy  development  has  continued  to  strengthen  the  sectoral  approach 
for  delivery  of  affordable,  safe  and  sustainable  transport  through  developing  sector 
programmes,  wherever  possible  financed  by  sector  budget  support.  Within  the 
framework  of  the  EU-Africa  Partnership  on  Infrastructure,  emphasis  was  given  to 
increasing  complementarity  between  10th  EDF  national  and  regional  programme  to 
develop the Trans-African Transport Corridors, thereby enhancing interconnectivity 
between  countries  and  regions.  These  efforts  have  led  to  transport  being  a  focal 
development  sector  in  38  ACP  countries  so  far,  of  which  35  are  in  Sub-Saharan 
Africa. 

The  European  Commission  continued  as  the  lead  donor  of  the  Sub-Saharan  Africa 
Transport  Policy  Programme  (SSATP).  SSATP  is  a  partnership  of  35  Sub-Saharan 
countries,  Regional  Economic  Communities  and  donors 
the 
development  of  transport  policies  and  implementation  strategies  to  strengthen 
economic growth and reduce poverty. It is recognised as a key policy instrument of 
the  AU-NEPAD  Infrastructure  Action  Plan  and  of  the  EU-Africa  Partnership  on 
Infrastructure. 

that  facilitates 

The  European  Commission  enhanced  its  coordination  with  the  other  two  main 
financiers  of  transport  in  Africa,  the  African  Development  Bank  and  the  World 
Bank. Coordination was pursued on a bilateral basis and by participation in the G8-
created  Infrastructure  Consortium  for  Africa,  which  in  2007  had  transport  as  its 
thematic focus. This international coordination, linked with well-developed country 
sector-wide  coordination,  fosters  the  ownership,  alignment  and  harmonisation 
principles of the Paris Declaration. 

New technologies 

Policy development has focused on continued advocacy of the role new technologies 
play  in  contributing  to  economic  growth  and  delivery  of  social  services.  The 
Commission's  strategy  gives  priority  to  increasing  access  to  affordable  broadband 
telecommunications.  Working  closely  with  international  partners,  the  Commission 
was  able  to  support  the  management  and  financing  arrangements  that  accelerated 
efforts to extend a broadband telecommunications loop to maritime and land-locked 
countries in Eastern and Southern Africa – the “EASSy” submarine cable. Similarly, 
coordination  with  the  European  Space  Agency  provided  strategic  support  to 
advancing satellite-based telemedicine applications in Africa. 

The EU-Africa Summit  in Lisbon boosted progress with Global Monitoring for  the 
Environment  and  Security  (GMES)  and  marked  the  initial  steps  towards  an  Earth 
Observation Programme for Africa. It also created an EU-Africa Partnership on the 
Information Society, Science and Space Technologies (I3S) - an integral part of the 
EU-Africa  Joint  Strategy.  Increased  efforts  were  undertaken  to  prepare  for  “2008 
Africa  –  the  Year  of  Science”  with  a  focus  on  capacity  building  in  science  and 
technology  in  the  ACP  States,  and  a  cooperation  agreement  with  the  International 

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Telecommunications Union for creating a unique Telecom Regulation Framework in 
Africa. 

Within  the  framework  of  the  EU-Africa  Partnership  on  Science  (Lisbon  2007),  the 
Commission  launched  an  enhanced  dialogue  with  EU  Member  States  that  aims  to 
develop  a  strategy  for  Innovation,  Research,  Sciences  and  Technologies  to  better 
respond to Africa's development. This Partnership on Science needs to build on the 
existing African Science and Technology Consolidated Plan of Action. 

1.9.1.  ENP 

Important progress was made in the implementation of the European Neighbourhood 
Policy  (ENP),  a  comprehensive  policy  framework  encompassing  the  strengthened 
relations between the Union and 16 of its southern and eastern neighbours. Two new 
Action Plans were agreed, with Lebanon in January and Egypt in March, bringing the 
total amount of the ENP Action Plans to twelve. 

The  first  ENP  Ministerial  Conference,  entitled  “Working  Together  –  Strengthening 
the  European  Neighbourhood  Policy",  was  organised  in  Brussels  on  3  September. 
The  event  was  attended  by  all  EU  and  ENP  states  and  gathered  more  than  700 
participants  representing  the  governmental  sector,  non-governmental  organisations 
and  business  groupings.  Discussions  focused  particularly  on  opportunities  for  trade 
liberalisation, mobility and the challenges of climate change and energy security in 
the ENP area. 

On  5  December  the  Commission  presented  the  Communication  A  strong  European 
Neighbourhood  Policy23.  Recommendations  include  increasing  the  EU  “offer”  on 
economic  and  trade  integration  with  the  partners,  reducing  obstacles  to  short-term 
travel,  facilitating  more  exchanges  and  tackling  frozen  conflicts  in  the  ENP  area 
more vigorously. In the Mediterranean region, the EU pursues its  objectives within 
the overall framework provided by the Euro-Mediterranean Partnership. 

Following the latest round of enlargement, bringing the EU borders to the Black Sea, 
in  April  the  Commission  adopted  a  Communication  introducing  the  "Black  Sea 
Synergy",  a  regional  cooperation  initiative  for  the  Black  Sea  region.  The  official 
launch of the Black Sea Synergy will be marked by the Black Sea Region and the EU 
Ministerial Meeting on February 14, 2008 in Kiev. 

Relations between the EU and the Russian Federation remain distinct from the ENP. 
In 2007 two summit meetings between EU and Russian leaders took place. The focus 
of  relations  was  on  implementation  efforts  and  negotiation  of  a  new  overall  EU-
Russia  agreement.  The  Commission  also  continues  its  involvement  in  regional 
cooperation in Northern Europe and the Barents Region through activities within the 
framework of the Northern Dimension. 

1.9.2.  Aid for Trade 

At the WTO Ministerial held in Hong Kong in 2005, the European Union pledged to 
raise  its  support  for  Trade-Related  Assistance  to  €2  billion  per  year  from  2010  (€1 

23 

COM(2007)774 final 

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billion  from  the  Community  aid  budget  and  €1  billion  in  bilateral  aid  from  the 
Member States) as a contribution to the collective efforts of donors and developing 
countries  to  increase  the  production  and  trade  capacities  of  developing  countries. 
During  the  year,  intensive  discussions  between  Member  States  and  Commission 
experts  took  place  to  shape  a  common  strategy  enabling  the  Union  to  deliver  an 
effective,  coherent  and  co-ordinated  response  to  the  partner  countries’  trade-related 
priorities. On 15 October, the Council adopted the "EU strategy on Aid for Trade". 
The  Commission  and  Member  States  are  now  working  on  the  concrete  follow-up 
activities, including linking these orientations to the ongoing programming processes 
for the ACP countries, in order to rapidly deliver on the strategy. So as to ensure a 
wide  geographical  coverage  of  EU  Aid  for  Trade,  similar  efforts  will  be  made  in 
other regions. 

The strategy is an important complement to active trade negotiations on multilateral, 
regional  and  bilateral  levels,  such  as  the  Doha  Development  Agenda  and  the 
Economic Partnership Agreement negotiations. It addresses relevant broader issues, 
covering classic Trade-Related Assistance (including assistance in the fields of trade 
policy  and  regulations  and  trade  development)  as  well  as  assistance  to  efficient 
capacity  building  related  to  trade  infrastructure  and  trade  adjustment  issues,  i.e.  to 
contribute to partner countries' efforts to mitigate fiscal effects of trade liberalisation. 

In  addition  to  increasing  the  volumes  of  its  assistance  devoted  to  Trade-Related 
Assistance and wider Aid for Trade, through the implementation of this strategy the 
EU expects to enhance the quality of its aid. It aims to render its Aid for Trade more 
pro-poor, to specifically promote regional integration processes (in particular of the 
ACP  countries,  for  which  around  50%  of  the  increase  in  TRA  is  to  be  made 
available), and to strengthen EU capacity to deliver aid effectively using more joint 
planning  and  delivery  approaches  under  country  and  regional  leadership.  The 
strategy  contains  provisions  to  monitor  its  implementation  by  the  Commission  and 
the Member States and to report on results. 

1.10.  Outlook 2008 (conclusions and perspectives) 

The priorities and focus for the European Commission's development policy in 2008 
five  main  policy  documents:  a  package  of 
will  be  articulated  around 
Communications  on  EU  development  policy;  a  Communication  on  economic 
development  and  regional  integration;  a  Communication  on  the  implementation  of 
the Joint EU-Africa Strategy; a Communication on EU-Africa-China cooperation and 
a Green Paper on future relations with Overseas Countries and Territories. 

A  Communication  on  development  policy,  The  EU  as  a  global  partner  for 
development: doing more, better and faster, will outline the EU contribution to the 
Third  High  Level Forum on Aid Effectiveness (Accra, September 2008) and  to the 
Follow-Up Conference on Financing for Development to Review the Implementation 
of the Monterrey Consensus (Doha, November-December 2008). It will also address 
policy  coherence  for  development  issues,  drawing  lessons  from  the  debate  on  the 
first EU report on this topic issued in September, Aid for Trade and the state of play 
regarding  the  MDGs.  The  Communication  will  be  supported  by  policy  papers 
covering the five themes. 

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With regard to aid effectiveness, it is expected that the High Level Meeting in Accra 
in  September  2008  will  provide  a  unique  platform  for  the  EU  to  demonstrate  its 
performance,  as  well  as  an  opportunity  to  involve  non  EU-donors  in  applying  the 
recently  approved  EU  Code  of  Conduct  on  Division  of  Labour  among  donors.  A 
comprehensive  paper  will  include  a  declaration  on  the  need  for  division  of  labour, 
the  Code  of  Conduct,  some  positive  examples  of  applying  the  Code  in  selected 
countries, a compendium on best practices in the division of labour and reporting on 
the Member States' and the Commission's self-assessment of comparative advantage, 
the  achievement  of  the  additional  commitment  and  the  Commission's  performance. 
Concerning  the  Monterrey  commitments,  the  High  Level  Meeting  in  Doha  in 
December 2008 will review progress on the commitments made in 2002 on financing 
for development. The report prepared by the Commission will cover the whole range 
of EU commitments. 

A Staff Working Paper on policy coherence for development will draw lessons from 
the discussions on the first EU Policy Coherence for Development report (issued in 
September) and will present more specific and concrete recommendations to enhance 
the  coherence  of  EU  policies  with  development  objectives  in  three  policy  areas, 
namely migration, research and climate change. The development package will also 
include a monitoring report on the implementation of the EU Aid for Trade Strategy 
adopted in 2007. This document will cover the activities of the Member States and 
the  Commission  in  supporting  trade  in  partner  countries  and  will  assist  in  tailoring 
EU support to achieve the overall Aid for Trade strategy objectives by 2010. Finally, 
an annex on the MDGs will provide an assessment of progress so far, outlining the 
policy and institutional context as well as several key focal areas for action. 

The  second  policy  document  is  a  Communication  on  economic  development  and 
regional integration in the ACP. The paper will consider the best approach to foster 
economic development and regional integration in the ACP, with a strong focus on 
private  sector  development.  The  objective  will  be  to  develop  a  strategy  to  ensure 
complementarity of actions and instruments existing at EU and Member States level. 

The  third  pillar  will  be  a  Communication  on  the  Implementation  of  the  Joint  EU-
Africa  Strategy:  concrete  follow  up  measures  to  the  Joint  EU-Africa  Strategy.  The 
document  will  present  the  second  evaluation  of  the  implementation  of  the  EU 
Strategy  for  Africa.  It  will  integrate  the  priorities  identified  in  the  first  action  plan 
implementing the Joint EU-Africa Strategy and set the necessary guidelines for their 
implementation. The Communication will be based on a questionnaire circulated to 
Member States in early 2008 to create an EU monitoring document. Synergies with 
the Monterrey Communication will be ensured. 

The fourth Communication will be on The EU, Africa and China – cooperation for 
Africa’s  peace,  stability  and  sustainable  development.  It  aims  to  articulate  an 
innovative  agenda  for  a  trilateral  dialogue  and  cooperation  as  a  response  to  major 
new  developments  in  the  EU's  relations  with  both  partners  and  South-South 
cooperation.  The  impacts  on  security,  stability,  sustainable  development  in  Africa 
and  on  global  governance,  notably  of  China's  emergence  as  a  leading  partner  for 
Africa  in  the  past  few  years,  require  a  policy  response  by  the  EU  and  an  effort  to 
improve  the  coherence  of  our  agendas  regarding  both  Africa  and  China.  It  will 
propose  a  constructive  dialogue,  cooperation  and  ways  to  manage  competition  in 

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such a way as to make it beneficial to peace, prosperity and sustainable development 
in Africa. 

The fifth priority will be a Green Paper on the future relations between the European 
Union and the Overseas Countries and Territories (OCT). This will be a discussion 
document  intended  to  stimulate  debate  and  to  launch  a  consultation  process.  The 
Green Paper will put options on the table and constitute a basis for discussion about a 
modernisation  of  the  OCT-EU  association.  It  is  intended  as  a  preparation  of  a 
substantial revision of the Overseas Association Decision, within the limits of the EC 
Treaty. 

Finally,  the  Commission  will  produce  a  Communication  on  local  governance  and 
development,  which  will  also  be  the  focus  of  the  European  Development  Days  in 
2008. 

2. 

IMPLEMENTATION 

2.1. 

European Neighbourhood and Partnership  

2.1.1.  Bilateral cooperation 

2.1.1.1.  Introduction 

This was the first year of implementing assistance to the EU's neighbours through the 
European  Neighbourhood  and  Partnership  Instrument  (ENPI).  ENPI  provides  the 
framework  for  Community  assistance  in  support  of  the  relations  with  16  ENP 
partners, with the Russian Federation and for cross-border cooperation programmes 
on  the  EU's  external  border.  The  overall  budget  for  cooperation  with  neighbouring 
countries  for  the  period  2007–2013  stands  at  €12  billion  (€11.2  billion  from  ENPI 
and  the  rest  from  thematic  programmes  and  instruments).  This  constitutes  a  32% 
increase in real terms from the previous budget period. 

All  the  country  strategy  papers  for  the  period  2007-2013,  as  well  as  the  regional 
South and East and the Interregional and Cross Border Cooperation (CBC) strategy 
papers were adopted in March. These define priorities for financing and allocations 
for  each  of  the  programmes.  To  enhance  ENPI's  effectiveness,  the  Commission 
established additional financial mechanisms during the year. A Governance Facility 
provides  additional  support  to  countries  making  particular  progress  in  the 
implementation  of  reforms.  A  Neighbourhood  Investment  Facility  pools  grant 
resources  to  leverage  investment  in  partner  countries  from  European  development 
and  finance  institutions.  The  introduction  of  a  policy-driven  single  instrument, 
managed on the basis of uniform programming and implementation principles for all 
beneficiary  countries  and  endowed  with  increased  resources,  allowed  for  a  more 
ambitious and coherent policy towards all of the EU's neighbours in the east and in 
the south. It also strengthened the integrated nature of the European Neighbourhood. 

Bilateral relations 

The implementation of the ENP Action Plans of Armenia, Azerbaijan and Georgia, 
adopted  in  2006,  is  already  underway.  The  region  enjoyed  substantial  growth  in 
2007, fuelled by oil and energy-related activities, but limited redistribution of wealth 

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remained a matter of concern. The unresolved conflicts in Nagorno Karabakh, South 
Ossetia  and  Abkhazia  continue  to  undermine  regional  stability  and  significantly 
hamper development. In addition, in December clashes with the opposition and street 
riots led to early presidential elections in Georgia. 

Moldova  made  significant  progress  in  implementing  reforms  based  on  the  EU-
Moldova  ENP  Action  Plan.  It  concluded  Visa  Facilitation  and  Readmission 
Agreements  with  the  EC,  which  entered  into  force  on  1  January  2008,  and  a 
Common  Visa  Application  Centre  was  opened  under  Hungarian  leadership  in 
Chisinau  in  April  2007.  The  EU  granted  Moldova  additional  Autonomous  Trade 
Preferences  which  entered  into  force  on  31  January  2008.  The  EU  continued  its 
active  involvement  in  the  Transdnistria  settlement  efforts.  The  mandate  of  the  EU 
Border  Assistance  Mission  to  Ukraine  and  Moldova  (EUBAM)  was  extended  until 
2009.  Negotiations  on  a  new  Enhanced  Agreement  between  the  EU  and  Ukraine 
started  in  March.  Agreements  on  Visa  Facilitation  and  Readmission  entered  into 
force  on  1  January  2008.  There  was  positive  cooperation  on  foreign  policy  and 
substantial progress on energy cooperation.  Although the year was  marked by long 
pre-  and  post-election  periods  of  instability,  which  slowed  down  the  pace  of 
implementation,  the  ENP  Action  Plan  continued  and  Kiev  received  an  additional 
financial allocation from the ENPI Governance Facility.  

As the Russian Federation is not part of the ENP, financial cooperation between the 
EU  and  Russia  was  geared  towards  the  implementation  of  the  "four  Common 
Spaces"  of  the  EU-Russia  Strategic  Partnership  –  a  framework  for  the  bilateral 
cooperation.  The  EU  maintained  special  interest  in  supporting  the  development  of 
neighbouring Kaliningrad Oblast. 

Most  of  the  economic  and  social  reforms  supported  in  the  ENP  Action  Plan  with 
Tunisia made good progress. Meetings of six subcommittees took place, including a 
first meeting of the subcommittee on human rights and democracy. Furthermore, in 
November  the  EU-Tunisia  Association  Council  met  for  the  first  time  in  two  years. 
Implementation of the ENP Action Plan with Morocco continued to make progress 
and  sub-committees  met  regularly.  In  July  the  EU-Morocco  Association  Council 
decided to launch a reflection process on the strengthening of bilateral relations. As a 
reward for successful implementation of the reforms, Morocco received an additional 
financial allocation from the Governance Facility. 

The Egypt ENP Action Plan was adopted in March. Assistance will focus on reforms 
in the areas of democracy and human rights, competitiveness and the sustainability of 
development. Negotiations on a Memorandum of Understanding between the EU and 
Egypt  on  a  Strategic  Partnership  on  Energy  were  concluded  and  Egypt  hosted  the 
“EU-Africa-Middle East Energy Conference” in Sharm-el-Sheik. EU-Israel relations 
developed further, resulting in Israel’s participation in the 7th Framework Programme 
for Research and Development, in the Entrepreneurship and Innovation Framework 
Programme  as  well  as  in  establishment  of  the  EU–Israel  business-to-business 
dialogue.  Jordan  made  further  progress  with  the  implementation  of  its  ENP  Action 
Plan.  A  second  round  of  sub-committees  was  held,  including  a  dialogue  on  human 
rights. The Commission and Jordan stepped up cooperation in the energy sector and 
signed  a  Joint  Declaration.  The  adoption  of  the  Action  Plan  in  January  marked  the 
launch of the ENP in Lebanon. In addition, the Commission devoted its attention to 

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the  implementation  of  the  financial  package  of  €50  million  for  actions  aiming  to 
reinvigorate and rehabilitate the country after the 2006 military conflict. 

The Commission continues to be the largest donor of assistance to the Palestinians. 
Together  with  support  granted  through  international  organisations  and  numerous 
NGOs,  EC  support  to  the  Palestinian  people  reached  an  unprecedented  amount  of 
€550  million.  In  June  the  EU  resumed  normal  relations  with  the  Palestinian 
Authority,  including  the  resumption  of  financial  assistance.  The  Temporary 
International Mechanism (TIM) continued to provide vital assistance directly to the 
Palestinian population. The Commission continued to respond to the difficult socio-
economic  situation  in  the  Hamas-controlled  Gaza  Strip,  but  difficulties  in  access 
significantly hamper the assistance. 

the  second  Association  Council  meeting  was  held.  The 

The EU also continued its cooperation with those countries that have, heretofore, no 
legal  agreements  providing  the  basis  for  ENP  relations.  In  relations  with  Algeria, 
priority was given to putting the Association Agreement's potential into practice. In 
technical 
April 
subcommittees met regularly and worked effectively. However it is still premature to 
anticipate  the  adoption  of  an  ENP  Action  Plan  by  Algeria.  Relations  with  Libya 
developed.  In  October  the  Council  requested  the  Commission  to  submit  draft 
negotiation directives with a view to a future EU-Libya framework agreement. The 
negotiations  are  expected  to  start  in  2008.  Political  relations  between  the  EU  and 
Syria remained tense in 2007, but efforts were made to ease them, including a visit 
by  Javier  Solana  to  Damascus.  No  progress  was  made  regarding  the  Association 
Agreement.  Nonetheless,  the  Syrian  government  continued  to  implement  economic 
reforms.  No  real  progress  was  noted 
its 
sanctions against the Belarusian government and – after persistent violations of trade 
unions  rights  –  withdrew  the  Generalised  System  of  Preferences.  Only  some 
technical  talks  between  the  Commission  and  Belarus  were  held  on  energy and 
transport.  Intensification  of  contacts  might  follow  if  the  political  situation  permits. 
Belarus  is  offered  to  fully  benefit  from  ENP  if  it  takes  convincing  steps  towards 
democratisation. 

in  Belarus.  The  EU  continued 

2.1.1.2.  Aid effectiveness and donor coordination 

In  most  of  the  countries  of  the  ENPI  region  enhanced  donor  co-ordination  with  a 
view to creating strong synergies and linkages between the various EC programmes 
and  the  programmes  of  other  donors  is  well  established.  This  is  usually  achieved 
through  coordination  with  IFIs  (including  the  EBRD,  EIB,  World  Bank  and  the 
African Development Bank) or cooperation with EU Member States. 

In  the  ENPI-South  region,  the  successful  implementation  of  the  Temporary 
International  Mechanism  (TIM)  serves  as  a  good  example  of  what  effective  donor 
coordination can achieve. The Member States and the Commission have channelled 
most of their aid in favour of the Palestinian population through the TIM since mid-
2006. That year, the Commission committed a total amount of €389 million for the 
TIM;  Member  States  and  other  donors  contributed  an  amount  of  €131  million. 
Implementing  the  TIM  continued  to  be  a  collaborative  effort  with  strong  co-
ordination locally complemented with co-ordination in capitals. Based on the lessons 
drawn from the TIM's success, a new instrument will be put in place in 2008 making 
full use of the existing local coordination groups in full liaison with the Palestinian 

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Authority  administration,  the  Office  of  the  Quartet  Representative  and  the  Ad  Hoc 
Liaison Committee structures. 

In  the  ENPI-East  region,  donor  coordination  is  improving,  with  regular  exchanges 
between  the  Commission,  Member  States  and  international  donors  often  hosted  by 
the local Commission Delegations. Appropriate coordination mechanisms are being 
created  in  several  countries.  For  example,  this  year  donor  coordination  and 
harmonisation  in  Moldova  further  benefited  from  the  Development  Partnership 
Framework  signed  in  2006  between  the  government  and  key  donors,  including  the 
Commission.  It  contains  performance  indicators  for  both  government  and  external 
partners  to  assess  progress  towards  measures  for  increased  aid  effectiveness.  In 
addition,  this  year  Ukraine  joined  the  Paris  Declaration.  However,  government-led 
donor  coordination  is  still  weak  in  the  region.  From  2008  there  will  then  be  full-
fledged  Commission  Delegations  in  all  Eastern  ENPI  countries,  which  will  further 
enhance the coordination process. 

2.1.1.3.  Working towards the MDGs 

ENPI gives a high priority to the promotion of sustainable development and fighting 
poverty,  including  through  measures  leading  to  the  progressive  participation  of 
beneficiary countries in the EU’s internal market.  

Based  on  monitoring  results,  it  appears  that  72%  of  active  projects  in  ENPI-South 
countries directly or indirectly address one or more MDGs. MDG 8 ("developing a 
global partnership for development") is best represented in the Mediterranean region, 
with  65%  of  the  monitored  active  projects  falling  into  this  objective.  A  high 
proportion of the projects focused on the development of an open rule-based trading 
and financial system – including the commitment to good governance, development 
and poverty reduction. MDG 7 concerning environmental sustainability is addressed 
by 28% of monitored projects in progress. Most of these projects focus on regional 
integration involving all the partner countries. 

In  the  ENPI-East  region  virtually  all  EC  projects  and  programmes  are  geared  to, 
directly  or  indirectly,  reducing  poverty  and  reaching  other  MDGs.  For  instance, 
support  to  institutional  reform  focuses  on  good  governance,  which  ultimately  also 
represents a benefit for the most vulnerable layers of the population. Specific projects 
in  several  countries  focus  on  child  protection,  e.g.  in  Moldova  and  Georgia.  To 
combat HIV in Ukraine, the Commission is funding a project focussing on the armed 
forces.  EC  assistance  to  the  vocational  education  reform  in  Armenia  will  lead  to  a 
reduction  in  unemployment  and  thus  reduce  poverty.  The  special  North  Caucasus 
Programme has a strong component to support primary education. 

2.1.1.4.  Regional cooperation and integration 

ENPI  programmes  for  regional  cooperation  play  an  important  role  in  fostering 
cooperation  between  countries  on  issues  of  mutual  interest,  both  in  Eastern  Europe 
and the Mediterranean basin. 

This  year,  €97.4  million  was  made  available  for  regional  cooperation  with 
Mediterranean  partners  on  a  variety  of  projects.  The  Commission  continued  to 
support  civil  society  initiatives  in  support  of  the  Peace  Process  through  a  new 
allocation  for  the  Partnership  for  Peace  programme,  which  encourages  cooperation 

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between  Israeli  and  Arab  people  through  several  civil  society  initiatives.  A  new 
programme  provides  support  to  regional  disaster  preparedness,  building  on  earlier 
Commission-supported  pilot  projects.  Its  aim  is  to  reinforce  prevention  capacity  at 
regional  and  local  level  in  the  wake  of  man-made  natural  disasters.  Other 
programmes  approved  this  year  focus  on  women's  rights  and  support  civil 
organisations,  and  the  promotion  of  Mediterranean  cultural  heritage.  Finally,  the 
Commission  made  available  €32  million  in  support  of  the  multi-lateral  investment 
fund  for  the  Middle  East,  FEMIP,  which  will  allow  the  EIB  to  provide  technical 
assistance as well as risk capital support both through direct investments as well as 
increasingly through participations in regional funds. 

New  regional  programmes  in  partner  countries  along  the  Eastern  border  of  the  EU 
received  funding  this  year.  These  include  programmes  to  support  the  beneficiary 
countries' administrations in the implementation of air and land transport safety and 
security measures, to deepen the integration of the energy markets in the region and 
to  develop  energy  efficiency  and  renewable  energy  more  extensively.  A  new 
programme started on sustainable forest management to strengthen the rule of law in 
this  field.  The  successful  European  Union  Border  Assistance  Mission  to  Moldova 
and  Ukraine  (EUBAM)  was  also  financed.  The  Commission  will  also  intervene  in 
Belarus in order to destroy the country's stockpiles of anti-personnel landmines. 

Other  activities  continued  in  2007  in  the  domains  of  natural  resources,  energy  and 
transport. Several projects deal with the use and preservation of water resources, the 
improvement  of  water  governance  or  the  integrated  trans-boundary  management  of 
river  basins  in  the  region.  A  specific  programme  supports  energy  cooperation 
between  the  EU,  the  countries  bordering  the  Black  and  Caspian  Seas  and  their 
neighbours.  This  year  it  focused  on  the  convergence  of  energy  markets,  the 
enhancement of energy security, sustainable energy development and the raising of 
investment in energy projects of common and regional interest. Progress was made to 
improve  international  transport  in  the  Black  Sea  region,  the  Caucasus  and  Central 
Asia.  Ambitious  projects  were  launched  to  improve  maritime  links  with  the 
neighbouring countries, notably through the development of 'Motorways of the Seas' 
for the Black and Caspian Seas. Specific expertise was also dedicated to the transport 
of dangerous goods and LPG along the TRACECA corridor, while intensive training 
and support was provided to the region's freight carriers. The objective is to create an 
effective  transport  market  involving  the  EU  and  its  neighbours.  Finally,  through  a 
pilot  project  launched  this  year,  the  Commission  provided  35  scholarships  for  the 
academic  year  2007-2008.  These  will  enable  university  graduates  from  ENP 
countries and Russia to pursue a Master's in European Integration at the College of 
Europe so as to further develop their professional skills and to enable them to better 
understand the European Union. 

2.1.1.5.  Implementation 

2007 was a transition year, marked by the adoption of annual action programmes in 
the new ENPI framework for all Southern and Eastern countries. In total, €1.7 billion 
in assistance was decided in favour of the 17 countries of the Eastern and Southern 
border  of  the  Union  from  the  2007  EC  Budget.  In  the  Eastern  ENPI  countries,  the 
annual action programmes included energy sector reform in Ukraine and Azerbaijan, 
with particular attention to energy efficiency and sustainability; poverty reduction in 
Moldova,  with  special  attention  to  the  reform  of  the  social  assistance  sector;  and 

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fighting  unemployment  in  Armenia,  where  the  Commission  uses  sector  support  to 
contribute  further  to  the  development  of  vocational  education  and  training.  For 
ENPI-South, new programmes focused mainly on support to social sectors, including 
basic  health  and  education  (around  40%)  and  economic  issues  (around  30%);  but 
also  governance,  regulatory  framework  and  capacity  building  (around  24%),  and 
energy and environment, including demining actions (around 6%). 

including 

As  under  the  MEDA  regulation,  the  Maghreb  countries  continued  to  be  important 
beneficiaries  of  Commission  support.  Morocco  faces  important  social  challenges. 
Programmes  were  supported  to  fight  poverty,  and  to  provide  medical  insurance  for 
the  poorest,  alphabetisation  and  non-formal  education.  Support  for  administrative 
reform, 
the  modernisation  of  human  resources  management  and 
decentralisation  continued.  Tunisia  obtained  new  support  for  accompanying  the 
implementation  of  the  Association  Agreement  and  the  Action  Plan,  building  on  a 
similar  programme operational  since 2004. Thus, Tunisia continues to benefit from 
twinning  programmes  with  a  view  to  enhancing  and  modernising  its  administrative 
capacity.  The  same  objective  is  pursued  with  a  new  programme  that  promotes  the 
modernisation of public finance management by introducing 'budgeting by objective'. 
Two other new programmes, an environment and energy programme and interest rate 
subsidy in support of industrial de-pollution, are intended to enhance sustainability. 
Cooperation with Algeria was given new impetus through the adoption of two new 
programmes.  The  first  supports  the  development  of  small  and  medium-sized 
enterprises,  building  on  an  earlier  programme  which  has  supported  over  400 
Algerian  SMEs.  The  second  concerns  the  modernisation  of  prisons  by  modernising 
imprisonment  conditions  and  supporting  vocational  training  and  re-integration.  The 
Commission  made  available  another  €2  m illion  to  Libya  in  support  of  the  EU-
supported HIV/AIDS Action Plan for Benghazi. 

Egypt  remains  one  of  the  main  beneficiary  countries  of  the  ENPI-South  region.  A 
substantial  package  was  committed  to  support  the  Education  Sector  Policy  Support 
Programme, a coordinated multi-donor effort in support of comprehensive education 
reforms that emphasises decentralisation, quality improvement and higher efficiency. 
To  support  implementation  of  the  ENP  action  plan  adopted  in  March,  additional 
funds were made available for twinning programmes. Recent examples of twinning 
actions have been in the field of Tourism, Postal Management and Maritime Safety. 
In  Lebanon,  socio-economic  development  was  much  affected  by  the  persistent 
political deadlock. In addition, the loss of life and extensive damage to the Nahr el 
Bared  Palestinian  refugee  camp  affected  the  stability  of  the  country.  At  the  Paris 
Donors  Conference  in  January,  the  Commission  reiterated  its  pledge  in  support  of 
Lebanon's  reconstruction  and  socio-economic  reform  programme.  Under  the  2007 
bilateral  national  action  programme,  Lebanon  was  granted  substantial  resources  for 
economic recovery, political reforms, access to finance, and de-mining and clearance 
of unexploded ordinance. 

In Jordan, the Commission continued to support the extensive reform efforts that the 
government is implementing by approving a National Financing Plan covering three 
priorities: the development of the services sector and its export capacities through a 
services  modernisation  programme;  the  launching  of  an  ambitious  public  finance 
reform programme, and a vital de-mining programme at Jordan's northern border that 
will  make  Jordan  completely  mine-free  by  2009.  In  Syria  cooperation  focused 
mainly on economic reforms via a Trade Enhancement Programme to accompany the 

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opening  up  and  diversification  of  the  Syrian  economy.  A  smaller  Business 
Environment  Simplification  Programme  will  assist  Syria  in  simplifying  procedures 
for  economic  operators,  reducing  red  tape,  and  improving  services  to  the  business 
community.  Lastly,  a  small  envelope  was  decided  in  favour  of  Israel,  allowing  the 
launch of the first twinning project in the field of Data Protection. 

This was a difficult year for the Palestinian people, with social and poverty indicators 
continuing  to  deteriorate. Political developments were significant with the effective 
take-over  of  Gaza  by  Hamas  and  the  formation  of  a  new  independent  government. 
These  developments  directly  affected  the  orientation  and  implementation  of  EC 
assistance. The Temporary International Mechanism (TIM) continued its operations 
throughout  the  year  in  the  West  Bank  and  in  Gaza,  with  the  Commission,  making 
available  €350  million  to  all  areas  of  th e  TIM.  The  Commission  also  developed  a 
scheme to support economic activity and employment by helping to reduce the stock 
of  arrears  of  the  Palestinian  Authority  due  to  the  private  sector.  €20  million  have 
been allocated and payments began this year. In addition, the Commission continued 
other  projects,  including  its  regular  and  significant  support  to  UNRWA  with  a  €66 
million  contribution.  In  East  Jerusalem,  support  was  provided  for  social  initiatives. 
The Partnership for Peace Programme, which aims to promote the Middle East Peace 
Process through direct civil society relationships, continued. Funds  were  also made 
available  to  improve  food  security  and  to  support  the  work  of  the  Quartet 
Representative.  Taken  together,  total  resources  made  available  to  the  Palestinian 
people this year amounted to over €550 million. 

In  Russia,  the  Kaliningrad  region  remains  a  major  focus  of  assistance.  Due  to  its 
location as a Russian enclave within the EU, Kaliningrad has a strategic importance 
for both Russia and the EU. A major project started to assist the regional government 
in  the  implementation  of  public  administration  reform  and  to  raise  Kaliningrad's 
profile as a favourable investment destination. Border crossings are also a priority. A 
border  crossing  station  at  the  Lithuania-Kaliningrad  border  now  contributes  to 
expanding  trade  and  accelerating  the  traffic  flow  between  the  EU  and  the  Russian 
Federation, and a new one is being built on the Poland-Kaliningrad border. Another 
focus for EC assistance to Russia was the special programme for economic recovery 
for  the  North  Caucasus,  implementation  of  which  continued.  The  health  and 
education components of this programme are now well on their way, and during the 
year, medical as well as class room equipment was delivered to the region, and many 
health  care  specialists  and  school  teachers  received  training.  In  the  area  of 
environment  protection  and  waste  water  treatment,  the  construction  of  the  sludge 
incineration plant in Saint Petersburg was completed – the largest and most complex 
investment project ever financed through EU funds. 

In  Ukraine  and  Moldova,  institutional  reform,  e.g.  establishing  an  independent, 
impartial, efficient and professional judiciary, remained an important priority. Legal 
approximation in Ukraine continued to be supported through the Ukrainian-European 
Policy  and  Legal  Advice  Centre.  Economic  reforms  and  the  private  sector  also 
received  backing,  e.g.  through  projects  assisting  SME  in  both  countries.  This  year 
implementation  of  the  first  Twinning  Facility  project  in  an  Eastern  ENPI  country 
began in Ukraine in the field of energy sector reform. In Moldova, preparations for 
twinning are well advanced and the first project is expected to start in 2008. Support 
to local development was a priority for EC assistance in all regions in Ukraine, with 
several  actions  aimed  to  elevate  the  infrastructure  of  municipal  services  and  to 

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improve local management. Health care reform is another focus. In Moldova, access 
to essential social services for vulnerable layers of the population, including primary 
health  care  and  social  assistance,  was  improved  by  an  important  EC-funded 
initiative.  In  Ukraine,  young  drug  users  were  assisted  through  a  project  aiming  to 
establish a specific system of social services. In Belarus, the Commission continued 
to  provide  access  for  young  Belarusians  to  higher  education  abroad  if  they  were 
unable  to  study  at  home  for  political  reasons.  Support  was  provided  for  the 
independent  Belarusian  media,  for  the  production  of  independent  radio  and  TV 
programmes  for  Belarusian  citizens,  and  for  training  journalists.  Further  assistance 
included  promotion  of  human  rights,  support  for  Belarusian  NGOs  and  local 
authorities and for regions affected by the Chernobyl disaster. 

In Georgia, judicial reform was one of the main priorities for EC assistance. Public 
finance management reform was also a focus area and a sector support programme 
was signed. These initiatives focused on the Ministry of Justice and its services and 
on the Ministry of Finance (including its tax and customs departments). In order to 
tackle  the  social  consequences  of  transition,  continued  support  was  provided  to 
reform  primary  health  care,  concentrating  on  the  Kakheti  region.  Other  sizeable 
projects  in  the  social  domain  focusing  on  specific  regions  contributed  to  poverty 
reduction  and  economic  development.  In  addition,  a  large  project  concerning  child 
welfare  reform  started.  A  specific  and  continuing  concern  of  EC  assistance  to 
Georgia  was  rehabilitation  in  the  Georgian-Ossetian  and  Georgian-Abkhaz  conflict 
zones. In Armenia, administrative reform was further successfully supported by the 
Armenian-European  Policy  and  Legal  Advice  Centre.  In  the  area  of  education, 
interventions were mainly aimed to rehabilitate and develop the vocational education 
system.  Reforming  child  care  and  child  protection  were  priorities.  Regional 
development  projects  concentrated  on  regional  development  strategies,  regional 
planning  and  investments  for  SME,  and  agricultural  development.  In  Azerbaijan, 
institutional reform projects focused on the social protection sector and the Ministry 
of  Transport.  A  major  initiative  to  support  regional  economic  development, 
ultimately  focusing  on  poverty  reduction,  has  gone  ahead,  as  has  a  large  border 
management project at the border between Azerbaijan and Iran. Preparations are well 
advanced for the start of twinning projects in 2008. 

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Table 1 ENPI-Sector   Breakdown by sector of external aid financed on the General Commission Budget 
managed by EuropeAid in 2007

Commitments ( € million)

87 M€, 5%

150 M€, 9%

61 M€, 4%

207 M€, 12%

Payments ( € million)

48 M€, 3%

108 M€, 8%

100 M€, 7%

47 M€, 3%

Social Infrastructures: Education, Health,
W ater, Government & Civil Society,
Other 

Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services

Production : Agriculture, Forestry &
Fishing, Industry, Mining & C onstruction,
Trade & Tourism

Multisector/C rosscutting : Environment,
Other

1 161 M€, 70%

Budget Support, Food Aid, Food
Security

Others - Including Emergency
assistance, reconstruction relief

Social Infrastructures: Education, H ealth,
Water, Government & Civil Society,
Other 
Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services
Production : Agriculture, Forestry &
Fishing, Industry, Mining & Construction,
Trade & Tourism
Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food Security

Others - Including Emergency
assistance, reconstruction relief

175 M€, 12%

935 M€, 67%

Bilateral and Multilateral ODA/OA (EuropeAid only).

Table 2 ENPI-Total   External aid financed on the General 
Commission Budget managed by EuropeAid 2007

€ millions

2007

Commitments

         1 666    

Payments

         1 412    

Bilateral and Multilateral ODA/OA (EuropeAid only).

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2.1.1.6.  Monitoring 

In  the  Southern  ENPI  region,  external  results-oriented  monitoring  (ROM)  was 
pursued  and  further  developed,  capitalising  on  the  results  of  the  previous  years.  A 
total of 141 active projects with an overall value of €1.4 billion were monitored (99 
national and 32 regional). As in earlier years, particular attention and follow up was 
paid to projects with serious deficiencies for one or more of the ROM criteria. 

Table 3 Southern ENPI Monitoring Results per ODA Sector 

3.0

2.8

2.5

2.3

2.0

Social Infrastructure and Services

Economic Infrastructure and Services

Production sectors

Multisector - Crosscutting

Relevance

Efficiency

Effectiveness

Impact

Sustainability

In  the  Eastern  ENPI  region,  267  projects  and  programmes  were  monitored. 
Programme  performance  over  the  period  2003-2007  shows  a  stabilisation  of  the 
overall  scores  in  five  main  ROM  criteria.  The  average  result  for  the  region  is  2.84 
(out of 4), thus significantly above the statistical average of 2.50 ("on track"). This 
general positive picture emphasises the conclusion that assistance in the region (the 
monitored  projects  and  programmes  still  belonged  to  the  Tacis  programme)  can  be 
considered effective and sustainable. 

Table 4 Eastern ENPI Monitoring Results per ODA Sector 

3 .0

2 .8

2 .5

2 .3

2 .0

Social Infrastructure and Services

Economic Infrastructure and
Services

Production sectors

M ultisector - Crosscutting

Relevance

Efficiency

Effectiveness

Impact

Sustainability

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2.1.1.7.  Perspectives 

This year saw the operational start of the European Neighbourhood and Partnership 
Instrument  (ENPI).  Based  on  the  lessons  learned  as  far  as  2006,  ENPI  makes  EC 
external assistance simpler, more coherent and more flexible. It will now come with 
fewer annual priorities for increased impact, new financing facilities (Neighbourhood 
Investment  Facility,  Governance  Facility)  and  new  forms  of  cooperation  (Cross-
Border-Cooperation, Twinning and TAIEX), and it will be strictly policy-driven, in 
accordance  with  the  ENP.  ENPI  funds  allocated  to  Mediterranean  and  Eastern 
European countries will continue to depend on their needs and absorption capacity as 
well as their implementation of agreed reforms. 

For  both  geographic  zones,  in  and  beyond  2008  implementation  will  continue 
steadily  of  existing  commitments  in  priority  sectors  such  as  energy,  transport, 
mobility, border management, economic integration and trade, regulatory framework 
and  justice  reforms,  as  well  as  the  gradual  introduction  of  the  Neighbourhood 
Investment  Facility  (NIF). For  ENPI-East countries the main change brought about 
by the new instrument is the intensification of sector budget support. In this context, 
the indicative sector allocations of the 2008 annual action programmes will focus on 
e.g. energy efficiency and mutual trade promotion in Ukraine, social and economic 
development  in  Belarus,  or  the  justice  sector  in  the  three  countries  of  the  Southern 
Caucasus  (Armenia,  Azerbaijan,  Georgia).  Overall,  good  governance,  regulatory 
reform,  administrative  capacity  building,  poverty  reduction  and  socio-economic 
reform  continue  to  be  the  main  priorities  for  the  partner  countries  in  the  East,  as 
defined in the respective national indicative programmes 2007-2010. 

For  ENPI-South  countries  the  cooperation  priorities  remain  coherent  with  the 
strategic orientations for 2007-2013, namely to support economic and sector reforms 
and  to  promote  regional  integration  with  the  EU  Single  Market  and  among 
neighbouring countries themselves. In this light, the indicative sector allocations of 
the  2008  annual  action  programmes  will  mainly  focus  on  economic  issues  like 
economic diversification and competitiveness in Algeria, Tunisia and Egypt, support 
to the private sector in Morocco or trade facilitation in Jordan. Support to the social 
sectors and governance and the regulatory framework will also be prioritised, e.g. the 
planned  health  sector  reform  in  Algeria  and  Morocco  and  the  promotion  of  good 
governance  in  Egypt,  as  will  capacity  building,  and  growth  and  sustainable 
development.  Finally,  in  support  of  the  Palestinian  Reform  and  Development  Plan 
announced at the Paris Donors Conference held in December, the EU will implement 
PEGASE from February 2008. This programme will provide a flexible and effective 
financial  mechanism,  replacing  the  TIM.  It  will  be  the  Commission's  main 
instrument  to  deliver  financial  support  to  the  Palestinian  Authority  and  to  the 
Palestinian  population.  PEGASE  will  be  open  to  the  participation  of  EU  Member 
States  and  other  international  donors  and  will  operate  in  the  West  Bank,  East 
Jerusalem and the Gaza strip. 

Integrated social services for exposed families and children in Ukraine 

Ukraine has inherited a Soviet system of child-care that promoted  the  use  of  large  state-run 
institutions  to  care  for  children.  However,  institutions  are  almost  always  harmful  for 
children’s  development,  and  although  poverty  plays  a  significant  part  in  their  admission  to 
residential care, most children are in care for social reasons. To prevent this from happening 

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and to reduce the number of children placed in boarding institutions, this project has helped to 
create  favourable  conditions  and  develop  alternative  social  services  in  order  to  ensure  the 
right of vulnerable children to live in a safe and secure family environment. The project has 
produced  impressive  results.  In  the  Kiev  region,  135  cases  of  potential  infant  abandonment 
were  prevented,  179  children  were  re-integrated  into  their  biological  families,  42  children 
were placed in foster  care and 153 were adopted. The number of social workers has almost 
tripled  and  legislation  was  improved  with  a  particular  focus  on  prevention  of  family 
breakdown and a strong requirement for state authorities to act in the best interest of the child. 

The Temporary International Mechanism 

Initially established in June 2006 by the European Council for a period of three months, the 
mandate  was  extended  several  times.  The  Commission,  15  EU  Member  States,  Norway, 
Switzerland, Canada and Australia have contributed to the TIM. This year, the Commission 
provided €350 million. By end 2007, over €600 million had been allocated by all donors, over 
95%  coming  from  the  Commission  and  EU  Member  States.  The  TIM  is  now  expected  to 
cease  operations  at  the  end  of  March  2008,  to  be  replaced  by  a  new  EU  mechanism  called 
PEGASE. 

The  TIM  performs  its  operations  through  three  'windows'  that  together  have  helped  to 
alleviate the suffering of Palestinians caused by the worsening socio-economic situation. This 
has been achieved by providing medicines and other supplies, electricity and other essential 
utilities, and direct financial allowances to poor and vulnerable Palestinians based upon need. 
The  TIM  has  developed  efficient  and  effective  methods  to  ensure  transparency  and 
accountability.  Verification  and  audit  procedures  were  built  as  an  integral  part  of  operating 
systems  and  audit  plans  were  established  for  all  allowance  schemes  and  for  the  utility  (fuel 
delivery) programme. 

2.1.2.  Cross-Border cooperation (CBC) 

CBC is the new tool within ENPI to enhance cross border cooperation between EU 
Member States and 17 partner countries for the period 2007-2013. On the basis of a 
strategy  paper  approved  in  March,  15  CBC  programmes,  (9  land  border,  3  sea 
crossing  and  3  sea  basin  programmes)  will  be  established  along  the  Eastern  and 
Southern borders of the enlarged EU. 

The  challenge  in  2007  was  to  prepare  all  the  CBC  programme  documents  for 
approval.  Programme  documents  are  drafted  by  Joint  Task  Forces  and  working 
groups established for all programmes and composed of local, regional and national 
actors  from  both  Member  States  and  partner  countries.  The  preparation  of  these 
documents  follows  a  bottom-up  approach.  Each  will  include  a  socio-economic 
analysis  of  the  eligible  border  regions,  leading  to  a  strategy  to  be  adopted  for  the 
seven-year programme period. Priorities and measures are then identified as well as 
activities  needed  to  achieve  the  targets.  This  will  set  the  basis  for  future  calls  for 
proposals and projects. 

By the end of year, all programmes (with the exception of Spain-Morocco and CBC 
Atlantic)  had  identified  their  responsible  Joint  Managing  Authorities  in  the 
respective  EU  Member  States.  The  various  participating  countries  worked  together 

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intensively  to  formulate  cooperation  priorities,  even  in  sensitive  areas  where  open 
dialogues  are  sometimes  difficult.  The  Baltic  Sea  programme  was  the  first 
programme adopted by the Commission in December. The other programmes should 
be ready for adoption by the Commission in mid-2008. The first calls for proposals 
should  be  launched  in  the  second  half  of  2008  by  the  respective  Joint  Managing 
Authorities. 

2.2. 

European Development Fund 

2.2.1. 

Introduction 

On  31  December,  the  five-year  financing  cycle  under  the  9th  EDF,  covering  the 
period  from  2002  to  2007,  came  to  an  end.  The  9th  EDF  had  been  allocated  €13.5 
billion, including €2.2 billion for the Invest ment Facility managed by the European 
Investment  Bank.  To  this  initial  allocation  €4.1  billion  was  added  gradually  from 
uncommitted  balances  from  the  previous  EDFs  and  from  funds  from  projects 
supported  under  those  previous  EDFs  that  were  decommitted  during  the  9th  EDF. 
Moreover, as both EDF contracts and payments reached record levels in 2007, and as 
the Commission was able to achieve its objective of committing the entire 9th EDF 
budget  before  end  2007,  before  the  entry  into  force  of  the  next  EDF,  the 
implementation  of  development  cooperation  has  accelerated.  This  is  the  first  time 
that an entire EDF has been committed before the entry into force of the next EDF. 

Preparatory work on the 10th EDF advanced during the year with the adoption of the 
implementing  regulations24  and  the  aid  allocation  criteria25.  The  10th  EDF  financial 
regulation  was  expected  to  be  adopted  by  early  2008.  On  the  basis  of  the  aid 
allocation  criteria,  the  national  allocations  could  be  determined,  including  the 
allocation of an "incentive tranche" related to the quality of governance action plans 
elaborated by the partner countries. Fifty-one country strategy papers for the period 
2008-2013 were finalised and adopted by the Commission before the end of the year, 
which represents some €9 billion. Most othe r country strategy papers were expected 
to  be  adopted  in  the  first  half  of  2008,  while  the  regional  strategy  papers  and  the 
intra-ACP strategy paper should be finalised in the second half of 2008. 

The financial envelope adopted for the 10th EDF by the European Council comes to 
€22.7 billion, which includes the following: 

Table 5 

1. National and regional cooperation 

1.1 National indicative programmes (NIP) 

 A-envelopes (programmable funds)  

 B-envelopes (for unforeseen needs) 

EDF10 
Amount in M€ 26

17 766

13 500

1 800

24 
25 
26 

Council Regulation (EC) No 617/2007 of 14 May 2007; Official Journal OJ L 152 of 13.6.2007, p. 1 
Commission Decision C(2007)3617 of 1.8.2007 
The amounts in bold are those adopted by the ACP-EC Council of Ministers on 2 June 2006 

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46 

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- initial allocation 

- reserve for B-envelope replenishment and FLEX 

1.2  Regional  indicative  programmes  (RIP)  (~13%  of  A-
envelopes) 

1.3 Reserve for NIP/RIP reallocations after reviews 

2. Intra-ACP cooperation 

Sub-total operational credits for the ACP managed by the 
Commission 

3. Investment facility (managed by the EIB) 

Total operational credits for the ACP 

OCT 

Support expenditures 

Total ACP + OCT + support expenditures 

Own resource contributions from the EIB  

 - ACP 

 - OCT 

601

1 199

1 783

683

2 700

20 466

1 500

21 966

286

430

22 682

2 000

30

As soon as each EU Member State has ratified the 10th EDF Internal Agreement, and 
all  EU  Member  States  and  at  least  two  thirds  of  the  ACP  states  have  ratified  the 
revised  ACP-EC  Partnership  Agreement,  commitment  of  the  10th  EDF  funds  will 
begin. 

Table 6 NIP allocations 

NIP allocations

10%

11%

6%

3%

35%

35%

W.Africa

E.Africa

C.Africa

S.Africa

Carribean

Pacific

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Table 7 RIP allocations 

RIP allocations

9%

5%

33%

7%

9%

37%

W.Africa

E.Africa

C.Africa

S.Africa

Carribean

Pacific

2.2.2.  Africa 

2.2.2.1.  Introduction 

This  was  a  very  special  year  in  EU-Africa  relations.  Following  the  adoption  in 
December  2005  of  a  common  and  comprehensive  EU  Strategy  for  Africa,  the  EU 
and  the  AU  in  2007  took  the  partnership  one  step  further  in  the  build-up  to  the 
second  EU-Africa  Summit,  which  was  held  in  Lisbon  in  December.  For  two  days, 
leaders  had  substantive  discussions  on  a  large  number  of  key  political  issues, 
including  peace  and  security,  governance  and  human  rights,  trade,  regional 
integration and infrastructure, migration and climate change. Many participants (on 
both  sides)  highlighted  the  positive  developments  in  Africa  in  recent  years  –  more 
growth, more democratic elections, more confidence on the international stage, and 
the emergence of the AU as a strong and independent international actor and a key 
partner for the EU. Difficult issues, including the Economic Partnership Agreements 
(EPAs) were openly discussed. 

At  the  end  of  the  summit,  the  leaders  of  the  two  continents  –  representing  80 
European  and  African  countries  and  almost  1.5  billion  people,  adopted  a  political 
pledge:  the  Lisbon  Declaration,  a  Euro-African  consensus  on  values,  common 
interests and strategic objectives. The main policy documents adopted at the meeting 
were  the  Joint  Africa-EU  Strategy  and  the  First  Action  Plan  (covering  priority 
actions under eight thematic partnerships for 2008-2010). On this basis, the EU and 
Africa  together  will  now  gradually  move  the  EU-Africa  dialogue  and  cooperation 
“beyond  development”  (working  more  closely  on  issues  such  as  trade,  peace  and 
security,  and  the  environment),  “beyond  Africa”  (jointly  addressing  issues  such  as 
UN reform and the situation in the Middle East, Myanmar, and the Balkans as well 
as  global  issues  such  as  terrorism  or  climate  change)  and  “beyond  institutions”  (a 
stronger  role  for  civil  society,  the  private  sector  and  other  non-state  actors).  The 
challenge is now implementation and delivery of tangible results. It should be noted 
that  this  new  strategic  partnership  commits  the  EU  as  a  whole,  including  on  the 
financial side with global ODA commitments to increase to 0.56 % of GNI by 2010 
and 0.7% by 2015 and half of the increase to be allocated to Africa. 

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The implementation of the Joint Strategy and our overall relations with the AU will 
benefit from the creation in January 2008 of an EU Delegation to the AU in Addis 
Ababa. 

2.2.2.2.  Aid effectiveness and donor coordination 

In  2005,  the  EU  launched  a  pilot  initiative  as  a  concrete  step  towards  the 
coordination of policies and  harmonisation  of  procedures.  Mozambique  was  one  of 
the  four  countries  selected.  In  2007,  there  was  significant  progress  towards 
coordinated sector budget support in agriculture, road transport and health as well as 
harmonisation  of  donor  programmes.  In  addition,  the  first  phase  to  reform  public 
finance  systems  that  provide  functionalities  for  direct  online  budget  execution  has 
been  concluded.  The  Overseas  Development  Assistance  to  Mozambique  Database 
(ODAmoz) is a new EC-funded electronic tool that provides information on Official 
Development  Assistance  (ODA)  to  Mozambique.  It  was  launched  in  May  and  has 
greatly  improved  transparency  and  harmonisation  of  external  aid  to  Mozambique, 
providing the government with a solid basis for planning and budgeting. 

Other good practices and cases of operational complementarity are developing on an 
ad hoc basis in the field. Based on a National Plan for Aid Efficiency and a strong 
technical  secretariat,  the  government  of  Burkina  Faso  was  able  to  follow  the  main 
recommendations of the Paris Declaration. With the help of various sectoral and sub-
sectoral  working  groups  and  of  a  strict  division  of  labour  between  the  partners  the 
cooperation efficiency increased substantially. 

The  country  strategy  paper  (CSP)  for  Sierra  Leone  was  drafted  jointly  by  the 
government  of  Sierra  Leone,  the  Commission  and  the  UK  Department  for 
International Development. The joint exercise in Sierra Leone sets a unique example 
of  joint  programming  and  marks  an  important  step  towards  fulfilling  the  EU’s 
commitments  on  harmonisation  and  complementarity  of  donors’  activities.  For 
example,  other  CSPs  were  jointly  drafted  for  South  Africa  and  Somalia.  The  EU 
played  an  important  role  in  developing  the  Joint  Assistance  Strategies  in  Zambia, 
Tanzania, Uganda, Kenya, Ghana and Mali, in particular the joint donor response – 
to  be  based  on  a  division  of  labour  –  to  the  poverty  reduction  strategies  of  these 
partner countries. 

2.2.2.3.  Working towards the MDGs 

Poverty reduction and the achievement of the MDGs remain at the centre of the EU's 
agenda, especially in Sub-Saharan Africa. Half way towards the target date of 2015, 
Africa  is  still  progressing  too  slowly  towards  most  of  the  MDG-related  targets  and 
indicators.  Nonetheless,  there  are  encouraging  trends.  According  to  the  United 
Nations  2007  MDG  Report,  the  proportion  of  people  living  in  extreme  poverty  is 
beginning to fall in Sub-Saharan Africa, despite rapid population growth. Moreover, 
progress has been made towards increasing enrolment in primary education in Sub-
Saharan Africa. However, at 30%, the ratio of children of primary school age out of 
school still remains unacceptably high. 

Infant and child mortality rates have improved modestly over the past fifteen years, 
but accelerated improvements are urgently needed. Health accounts for a large part 
of EU Official Development Assistance (ODA) to Sub-Saharan Africa and aims for 

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49 

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equitable health services, giving a priority to child health. As far as the Commission 
is  concerned,  in  addition  to  direct  project  and  programme  support  to  the  health 
sector,  it  is  primarily  providing  support  as  general  budget  support,  where  some 
indicators are linked to improved health policies, strategies and outcomes. Moreover, 
a  large  part  of  EC  direct  aid  for  health  is  channelled  through  international 
organisations and global initiatives, such as the Global Fund to fight HIV/AIDS, TB 
and Malaria (GFATM) and the GAVI alliance. 

The  MDG  targets  on  water  and  sanitation  remain  off-track  in  Sub-Saharan  Africa, 
where in 2004 only 42% of people in rural areas had access to clean water and 37% 
had  access  to  basic  sanitation  facilities.  Between  2004  and  2007,  the  EU  has 
committed  €500  million  under  the  ACP-EU  Water  Facility,  focusing  on  countries 
where current access levels are particularly low. 

2.2.2.4.  Regional cooperation and integration 

In  Sub-Saharan  Africa,  the  regional  cooperation  and  integration  agenda  was 
dominated  by  negotiations  on  Economic  Partnership  Agreements  (EPAs)  with  the 
four African regions. The EPAs will contribute to promoting regional integration and 
development  by  supporting  progressive  integration  of  African  states  into  the 
international economy as well as giving improved access to the EU market, which, in 
turn, will bring trade growth and economic development. 

By  the  end  of  the  year,  interim  agreements  were  reached  with  almost  all  countries 
with  which  agreement  was  needed  so  as  to  avoid  trade  disruption  and  to  improve 
market  access  to  the  EU.  In  Central  Africa,  an  interim  EPA  was  initialled  with 
Cameroon  and  negotiations  are  continuing  with  the  other  countries  of  the  region 
toward  a  full  EPA.  Gabon  and  Congo  Brazzaville,  the  two  other  non-LDCs  in 
Central  Africa,  are  considering  their  adhesion  to  the  interim  agreement.  In  West 
Africa the Commission has signed interim agreements with Ivory Coast and Ghana, 
and in 2008 the objective is to conclude a full EPA with the Economic Community 
of  West  African  States  (ECOWAS),  including  the  West  African  Economic  and 
Monetary Union (UEMOA) plus Mauritania. In East Africa interim agreements were 
reached with the East African Community and the wider Eastern and Southern Africa 
group. In Southern Africa, interim agreements with five countries in the region have 
been  signed.  A  clear  agenda  and  timetable  for  progressing  towards  a  full  EPA  in 
2008 has been set. 

In 2008, EPA negotiations will continue in order to turn the interim agreements into 
comprehensive  economic  partnership  agreements  which  foster  genuine  regional 
integration.  The  Commission  has  provided  significant  financial  support  to  the 
preparation of the EPAs as well as to improving institutional capacity building and 
bolstering EPA negotiations under the TradeCom Facility. In 2007, €16 million was 
earmarked to further integration of ACP states into the multilateral trading system of 
the  WTO  and  to  finance  support  to  the  enhanced  integrated  framework.  Work  is 
underway on regional programming under the 10th EDF with major attention to trade 
and  EPA-related  support.  Moreover,  under  national  indicative  programmes  the 
Commission and ACP States have allocated significant financial resources to poverty 
reduction  and  economic  growth 
through  private  sector 
development. 

in  ACP  countries 

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50 

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In  the  context  of  support  to  regional  organisations,  the  European  Commission  is 
increasingly  using  the  mechanism  of  contribution  agreements  (CA)  to  improve  the 
efficiency and effectiveness of delivering aid to its partners. The CA allows regional 
organisations  to  use  their  own  rules  and  procedures,  provided  that  they  have  been 
confirmed  as  comparable  with  international  standards.  This  substantially  improves 
the speed and efficiency of decision-making and promotes the ownership of regional 
programmes. Already in 2005, the Common Market of Eastern and Southern Africa 
(COMESA)  has  signed  a  CA  for  an  amount  of  €33.5  million  with  the  European 
Commission  to  advance  the  regional  economic  integration  process.  So  far,  its 
implementation has made good progress. Three additional CAs will be implemented 
with COMESA with funds committed under the 9th EDF, covering a broad range of 
sectors such as adjustment costs, agriculture and conflict prevention. In West Africa, 
the  Commission  has  signed  CAs  with  the  West  African  Economic  and  Monetary 
Union (UEMOA) and the Economic Community of West African States (ECOWAS) 
aiming  to  strengthen  the  regional  integration  agenda  of  both  organisations  and  to 
support the EPA negotiations. 

2.2.2.5.  Implementation 

In  Sub-Saharan  Africa,  268  new  projects  for  a  total  of  €2.2   billion  have  been 
approved.  The  total  commitments  and  payments  under  the  EDF  in  Sub-Saharan 
Africa totalled €11,150 million in commitment s and €10,126 million in payments in 
the period 2002-2007. 

The  EU  continued  to  support  the  governments  of  Sub-Saharan  Africa  in  the 
implementation  of  their  poverty  reduction  strategies.  At  institutional  level,  several 
projects were launched in the field of good governance. For example, Burundi was 
granted €19.75 million for the preparation and  implementation of sectoral policies in 
justice,  decentralisation,  human  rights  and  gender  equality.  In  Rwanda,  the 
Commission provided budget support to allow for the overhauling of public finance 
management  and  the  implementation  of  new  social  policies,  which  led  to  the 
improvement  of  key  social  indicators.  At  operational  level,  the  focus  was  on  the 
modernisation  of  infrastructure  in  general  and  the  road  sector  in  particular,  where 
improvements are most urgently needed. The Commission financed, for instance, the 
completion of a road that is part of the regional corridor connecting southern Chad 
and the Central African Republic to the port of Douala on the Atlantic coast. 

During  the  year,  infrastructure  (27%),  health  and  education  (9%);  and  economic 
development (8%), received the greatest share of EDF commitments. Moreover, the 
Commission  devoted  considerable  additional  resources  to  global  initiatives  such  as 
the Global Fund to fight HIV/AIDS, TB and Malaria as well as to EU initiatives such 
as  the  EU-ACP  Water  and  Energy  Facility  and  the  African  Peace  Facility.  In 
addition,  the  Commission  launched  an  Infrastructure  Trust  Fund  for  Africa,  for 
which  a  contribution  of  €108.7  million  has  been  decided.  The  Trust  Fund  should 
generate  increased  infrastructure  spending  and  underpin  longer-term  development. 
There  was  a  continued  investment  in  general  budget  support  and  sectoral  policy 
support  programmes,  which  accounted  for  44  actions,  corresponding  to  22%  of  the 
new actions approved during the year. 

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2.2.2.6.  Monitoring 

Independent monitors assessed 368 operations in 43 countries in Sub-Saharan Africa. 
These  operations  consisted  of  360  national  or  regional  projects  or  programmes  as 
well  as  eight  specific  components  of  regional  programmes.  The  total  budget  of  the 
operations monitored was €4.6 billion, of wh ich €4.4 billion were financed from the 
EDF. 

Scores  can  range  from  1  (serious  deficiencies  in  performance)  to  4  (excellent 
performance).  An  average  score  of  2.5  indicates  that  a  programme  or  project  is  on 
track and achieving expected results. 

The  results  of  the  monitoring  exercise  showed  that  projects  in  Africa  performed 
rather  well  this  year,  presenting  an  overall  average  score  of  2.66  for  all  criteria. 
Africa  achieved  high  scores  with  regard  to  the  relevance  of  design,  impact  and 
sustainability  of  the  projects  monitored.  However,  improvements  are  needed  in  the 
social and economic sector as well as in production, infrastructure and services. 

Table 8 Africa Monitoring Results per ODA Sector 

3,0

2,8

2,5

2,3

2,0

Social
Infrastructure
and Services

Economic
Infrastructure
and Services

Production
sectors

Multisector -
Crosscutting

Commodity
Aid and
General
Programme
Assistance

Relevance Efficiency

Effectiveness

Impact

Sustainability

2.2.2.7.  Perspectives 

Over  the  year,  planning  continued  for  the  10th  EDF,  covering  the  financing  of  EC 
cooperation  activities  for  the  period  2008-2013.  Programming  exercises  have  been 
carried out and draft strategy papers completed with all but three countries in Sub-
Saharan  Africa.  Thirty  one  country  strategy  papers  and  indicative  programmes 
defining the cooperation and aid activities have been approved for an amount of €8 
billion. The programming process at national as well as at regional and all-ACP level 
will be finalised in 2008. 

Out of the envelope for national and regional cooperation under the 10th EDF, more 
than 90% (or €16 billion) is earmarked for geographic cooperation with Sub-Saharan 
Africa.  Out  of  this  amount,  €12  billi on  will  be  programmed  within  national 
indicative programmes at the start of the 10th EDF. Of this amount, an estimated €3.4 
billion  (28%)  will  be  provided  under  general  budget  support  to  the  national 

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treasuries.  A  further  €1.8  billion  (15%)  is  ex pected  to  be  mobilised  in  the  form  of 
sector budget support in the context of sector wide approaches. 

More than a quarter (over €3 billion) of 
the national indicative programmes will be 
invested  in  transport  infrastructure.  These  investments  often  have  a  regional 
dimension and will be complemented with investments in infrastructure funded from 
the regional and the all-ACP envelopes, including the EU-Africa Infrastructure Trust 
Fund,  to  enhance  regional  integration  and  continental  interconnectivity.  Total 
investment in infrastructure in Sub-Saharan Africa under the 10th EDF is expected to 
exceed €5 billion. 

Other  important  sectors  are  governance,  including  peace  and  security,  for  which 
rural  development  and  agriculture  for 
more  than  €1.5  billion  is  programmed,  and 
which more than €1 billion is earmarked. Additional support to the agricultural sector 
is foreseen for up to €280 million over the period 2007-2010 for the African sugar 
protocol  countries  benefiting  from  EC  Budget-funded  accompanying  measures  to 
help them restructure or diversify out of the sugar sector. 

In order to help countries to plan MDG-related public funding better, the European 
Commission, in consultation with EU Member States, has been developing the MDG 
Contract  that  will  provide  recipient  countries  with  longer  term,  more  predictable 
general  budget  support  under  the  10th  EDF.  The  MDG  Contract  targets  well 
performing countries that have successfully implemented budget support in the past 
and  show  a  commitment  to  achieving  and  monitoring  the  MDGs.  This  form  of 
budget support will provide a guaranteed level of support each year within a strong 
framework for monitoring performance and results. 

Grassroots poverty reduction in Rwanda 

The Ubudehe programme in Rwanda is alleviating rural poverty through community 
participatory  approaches  based  on  traditional  Rwandan  cultural  practices.  The 
programme  is  part  of  a  larger  effort  to  decentralise  the  hierarchical  Rwandan 
governance  system.  Its  main  objective  is  to  revive  and  foster  collective  action  at 
community  level.  By  empowering  the  marginalised  as  well  as  strengthening  the 
communities’  ability  to  make  decisions  locally,  the  programme  helps  to  improve 
governance,  to  restore  trust  in  local  structures  and  to  build  accountable  local 
institutions.  The  programme  was  first  piloted  in  the  Butare  province  in  early  2001. 
The Commission has financed the programme both in its initial pilot phase and, more 
recently, in its national roll-out. By mid 2008, the programme will have injected €25 
million at grassroots' level nationwide. 

Census support in Nigeria 

The census support project in Nigeria is the largest and most successful Commission-
funded project ever in Nigeria. With €116.5 million, the Commission's contribution 
accounts  for  over  half  of  the  total  budget.  The  census  filled  a  yawning  gap  in  the 
statistics  necessary  for  developing,  implementing  and  monitoring  economic  and 
social policies. It provided not only accurate and complete data but was also accepted 
by the majority of Nigerians. Past censuses in Nigeria had been disputed and rejected 

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by  large  sections  of  the  population.  The  final  results  were  published  in  May.  The 
statistics  now  available  may  provide  a  basis  upon  which  further  aid  may  be 
distributed  in  the  future.  The  project  was  implemented  with  other  donors,  most 
notably  the  United  Nations  Development  Programme  (UNDP),  the  United  States 
Agency for International Development (USAID) and the United Nations Population 
Fund (UNFPA) as well as Nigerian civil society organisations. 

Access to financial services for poor people 

is  a  flagship  for 

The  EU/ACP  microfinance  framework  programme 
the 
Commission’s  support  to  microfinance.  The  programme  aims  to  expand  poor 
people’s  access  to  a  wide  range  of  quality  financial  services.  For  example,  with 
funding from the EU/ACP microfinance programme, ProCredit has strengthened the 
capacity of its microfinance bank in the Democratic Republic of Congo (DRC). The 
grant enabled the bank to introduce technology-based products and to install the very 
first ATMs in the DRC. Moreover, ProCredit has opened 100 point-of-sales devices 
in Kinshasa to facilitate people’s access to financial services. Funds were also used 
to establish branches outside the capital, where access to financial services is limited. 
In  the  first  year,  the  bank  exceeded  its  own  targets,  growing  from  6,700  savings 
accounts to almost 30,000 and providing 4,500 new loans. 

2.2.3.  Caribbean (incl. OCTs) 

2.2.3.1.  Introduction 

The  EU  strategy  for  the  Caribbean  is  articulated  around  a  vision  of  the  future 
founded  upon  a  history  of  shared  values,  in  parallel  with  maximising  the 
opportunities  of  the  Cotonou  Agreement27.  The  strategy  aims  at  an  enhanced  EU-
Caribbean Partnership consisting of a set of interrelated facets, including a political 
partnership  based  on  shared  values;  addressing  economic  and  environmental 
opportunities and vulnerabilities, promoting social cohesion and combating poverty 
including the fight against HIV/AIDS, strengthening of health care systems, as well 
as the fight against illicit drugs and tax fraud. 

As specified in the Cotonou Agreement, the current trade system will be replaced by 
a wider economic partnership agreement (EPA) as from 1 January 2008. The aim of 
the  EPA  is  to  promote  regional  integration  and  economic  development.  The  EPA, 
which  was  initialled  in  December,  will  support  the  ambitious  regional  integration 
process that is already under way, helping to maximise its benefits. 

include  governance  and  competitiveness, 

The proposed 10th EDF country strategies address both the private and public sector. 
Focal  sectors 
infrastructure  and 
interconnectivity,  macroeconomic  budgetary  support  and  poverty  reduction.  Non-
focal  sectors  include  EPA  capacity  building  related  to  the  regional  programme  for 
additional trade-related  assistance  accompanying  the  EPA,  and  good  governance  in 
the tax area. 

27 

COM(2006)86 final 

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Implementation of the 9th EDF for OCTs got off to a slow start, but by the end of 
2007  all  primary  commitments  had  been  made.  The  majority  of  the  9th  EDF 
territorial and regional programmes and projects for the OCTs will still be operating 
in 2008. Following amendment of the overseas association decision28 and the related 
implementing regulation29, the programming exercise for the 10th EDF was launched 
and  it  should  be  completed  for  most  OCTs  in  2008.  In  addition,  an  in-depth 
discussion on the future of OCT-EU relations is foreseen, by means of a Green Paper 
to be published in 2008. 

2.2.3.2.  Aid effectiveness and donor coordination 

In  the  Caribbean,  donor  coordination  is  limited  to  the  few  bilateral  donors  present 
there.  There  is,  for  example,  close  cooperation  with  the  UK  Department  for 
International  Development,  which  particularly  provides  technical  assistance  to  the 
Eastern  Caribbean  countries,  and  with  the  Inter-American  Development  Bank  and 
the Caribbean Development Bank, in particular with regard to the implementation of 
regional  integration  programmes.  The  Commission  is  co-financing,  with  the  World 
Bank, a school rehabilitation project in Grenada; the Caribbean Regional Technical 
Assistance  Centre,  with  UNDP,  in  Barbados.  In  Dominica  and  Grenada,  the 
Commission  jointly  prepared  budget  support  programmes  with  the  World  Bank  as 
well  as  an  agricultural  census  and  reviews  in  collaboration  with  the  Food  and 
Agriculture  Organization  (FAO).  Together  with  the  World  Bank,  which  has 
contributed to some public expenditure and financial accountability assessments, the 
Commission is supporting public finance management reform in the Caribbean. 

2.2.3.3.  Working towards the MDGs 

The  Dominican  Republic  was  chosen  as  one  of  the  UN  Millennium  Project's  pilot 
countries to coordinate, monitor and follow-up on the progress towards the MDGs. 
This  has  been  taken  into  consideration  in  the  preparation  of  the  10th  EDF  national 
indicative  programme,  which 
€60  million  for  human  and  social 
development. The funds, which represent 40% of the total funds available, are to be 
channelled  through general budget  support. This allocation is intended to cover the 
long-term human and social development activities aimed to achieve the MDGs, in 
particular  the  goal  of  universal  primary  education.  In  order  to  fulfil  this  objective, 
€52 million was already allocate d to education under the 9th EDF. 

includes 

Primary education is  also  one of  the  main concerns in  Haiti,  which remains  one of 
the  most  fragile  and  poor  countries  in  the  region  after  25  years  of  political  and 
economic turmoil. Education remains essential for poverty reduction and the socio-
economic development of the country. An EU-funded programme worth €14 million 
has  been  put  in  place  to  support  the  quality  of  education.  It  is  coordinated  by  the 

28 

29 

Decision 2001/822/EC of the Council of 27 November 2001 on the association of the overseas countries 
and  territories  with  the  European  Community,  OJ  L  314,  30.11.2001,  p.  1.  Decision  as  amended  by 
Decision 2007/249/EC (OJ L 109, 26.4.2007, p. 33). 
Regulation  (EC)  No  2304/2002  of  the  Commission  of  20  December  2002  implementing  Council 
Decision  2001/822/EC  on  the  association  of  the  overseas  countries  and  territories  with  the  European 
Community, OJ L 348, 21.12.2002, p. 82. Regulation as amended by Regulation (EC) No 1424/2007 
(OJ L 317, 5.12.2007, p. 38). 

EN 

55 

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Canadian 
Development Bank (IADB) and the World Bank. 

International  Development  Agency 

(CIDA), 

the 

Inter-American 

The  Commission  is  also  supporting  several  projects  and  programmes  to  combat 
HIV/AIDS, which is a major concern in the Caribbean, where infection levels are the 
second highest worldwide. The Commission is the largest individual donor assisting 
the Caribbean OCTs in this area and recently approved a €6 million grant from the 
9th EDF to support the Caribbean Dutch and British OCTs in their efforts to reduce 
the spread of the disease. The programme targets eleven beneficiary territories and is 
being implemented by the Pan American Health Organisation (PAHO). 

2.2.3.4.  Regional cooperation and integration 

After intense dialogue, a full EPA has been initialled with all 15 Member States of 
the  Caribbean  Community  (CARICOM)  in  December,  covering  services,  trade  in 
goods and development support. The Caribbean is the first ACP region to agree on a 
full  EPA.  Some  20  sectoral  programmes  covering  all  areas  of  the  agreement  are 
being  elaborated,  translating  the  cooperation  provisions  of  the  EPA  into  concrete 
actions.  These  programmes  are  intended  to  specify  all  necessary  actions  the  region 
has  to  undertake  at  national  and  regional  level  in  order  to  meet  the  commitments 
defined  by  the  EPA.  The  Caribbean  regional  programme  that  is  currently  under 
preparation will be focusing on implementing the EPA accompanying measures. 

2.2.3.5.  Implementation 

By  the  end  of  the  year,  a  total  of  €258  million  under  the  9 th  EDF  had  been 
committed.  In  the  Caribbean,  14%  of  this  year's  commitments  were  devoted  to 
infrastructure,  12%  to  education  and  11%  to  economic  sector  development 
programmes.  €37  million  were  provided  fo r  emergency  relief  operations.  General 
budget  support  and  sectoral  policy  support  programmes  accounted  for  16%  of  the 
new  programmes  approved  in  2007.  The  cumulated  commitments  and  payments 
under  the  EDF  in  the  Caribbean  region  totalled  €945  million  in  commitments  and 
€706 million in payments over the period 2002-2007.

2.2.3.6.  Monitoring 

In the Caribbean, 110 operations in 18 countries were monitored, amounting to €919 
million of which €738 million were financed  from the EDF. The combined portfolio 
included  72  national  or  regional  projects  and  programmes  as  well  as  38  specific 
components under regional programmes. 

The region performed well, presenting an overall average score of 2.67 for all ROM 
criteria.  Slight  weaknesses  existed  in  social  infrastructures  and  services  as  well  as 
production. A special study on performance was conducted early in the year due to a 
low  average  efficiency  score  in  2006.  As  a  result,  corrective  measures  were  taken 
which have slightly increased the efficiency score. 

Table 9 Caribbean Monitoring Results per ODA Sector 

EN 

56 

   EN 

 
3,0

2,8

2,5

2,3

2,0

Social Inf rastructure and
Services

Production sectors

Relevance

Ef f iciency

Ef f ectiveness

Impact

Sustainability

2.2.3.7.  Perspectives 

The conclusion of the programming exercise for the 10th EDF was delayed in various 
countries  of  the  region,  while  awaiting  the  determination  of  the  incentive  tranche 
linked  to  the  quality  of  a  governance  action  plan  prepared  by  the  partner  countries 
and to be added to the initial aid allocation. Only 6 of the 15 country strategy papers 
were adopted in 2007. The remaining strategy papers are expected to be finalised in 
the first half of 2008. 

The  new  programming  exercise  2008-2013  represents  an  important  political 
commitment by the EU towards the Caribbean. A new generation of country strategy 
papers has been developed under the 10th EDF programming process. General budget 
support is considered as the most efficient way of aid delivery and will be considered 
therefore a priority wherever conditions permit. Under the 10th EDF the total amount 
destined for national and regional indicative programmes is around €731 million. 

The  Caribbean  has  experienced  a  significant  expansion  of  budget  support.  All  the 
Caribbean countries, with the exception of Belize and Suriname, have undergone the 
preparatory  steps  to  qualify  for  budget  support.  For  the  period  2008-2013,  €731 
million have been earmarked so far, for geographic cooperation at national level with 
the  Caribbean  countries.  One  third  of  this  amount  is  earmarked  for  general  budget 
support and another 23% is earmarked for sector budget support, mainly in support 
of sector wide approaches in the area of governance. The next most important sector 
is infrastructure, for which 28% of the national indicative programmes are set aside 
so  far.  The  validation  of  conditions  for  budget  support  in  the  OCTs  should  start  in 
2008.  In  the  follow-up  it  is  also  foreseen  to  channel  most  of  the  funds  of  the  10th 
EDF to the OCTs through budget support. 

Six  Caribbean  countries  are  also  party  to  the  EC-ACP  sugar  protocol  and  benefit 
from  very  significant  accompanying  measures  (for  a  total  of  €325  million)  to  help 
restructure  and/or  diversify  out  of  the  sugar  sectors.  The  multi-annual  indicative 
programmes for the period 2007-2010 were adopted in the course of the year. 

Support for the rum sector 

The  rum  industry  is  of  historical  and  economic  relevance  to  the  Caribbean.  The 
sector's  contribution  to  the  region's  economies  is  significant,  directly  or  indirectly 
employing  50,000  people.  Rum  is  the  fourth  largest  traditional  export  product, 

EN 

57 

   EN 

 
providing  over  €200  million  a  year  in  fore ign  exchange.  The  liberalisation  of  the 
spirits  markets  between  the  EU  and  the  US  left  the  rum  industry  in  the  Caribbean 
struggling.  In  2002,  the  Commission  launched  the  Integrated  Development 
Programme for the Caribbean Rum Sector (IDPCRS) worth €70 million, to prevent 
the  socio-economic  deterioration  that  would  have  been  brought  about  by  the 
continuing process of trade liberalisation. The programme will run until 2010 and has 
already  contributed  to  enhancing  the  competitiveness  and  profitability  of  the  rum 
sector. In particular, it has opened the sector markets in Europe by helping it to move 
from  being  a  supplier  of  commodity  rum  to  being  a  supplier  of  branded  products. 
Moreover, the co-funding scheme that has been put in place acts as a catalyst for new 
private sector investment in the sector and the region. 

Restoring an historic bridge in the Netherlands Antilles 

Willemstad, the capital of Curacao and the Netherlands Antilles, is built around the 
entrance  of  the  largest  natural  harbour  in  the  Caribbean.  The  two  parts  of  the  city 
have been linked for more than a century by a floating bridge of remarkable design. 
The  Queen  Emma  Bridge  –  affectionately  known  as  the  “Swinging  Old  Lady”  – 
swings up to 20 times a day, welcoming ships to the island of Curacao. Up to 15,000 
pedestrians use the bridge daily. Thus, the bridge is not only a historic landmark and 
tourist  attraction,  but  also  serves  as  the  most  important  logistical  link  in  the  city 
centre.  This  unique  monument  is  part  of  the  UNESCO  World  Heritage  City  of 
Willemstad. The EU has granted €9 million to  finance the restoration of the bridge 
and the works are now in full swing. The objectives of the project are to safeguard 
and enhance the attractiveness of the city centre of Willemstad, while contributing to 
the development of the tourist sector in Curacao. 

The works to restore this world famous pontoon bridge started in August 2005 and 
are  now  completed.  Given  the  monumental  nature  of  this  project  both  the  original 
design and the materials were used, whereby most of the timber and sections of the 
steel structure were replaced. The metal railing and typical light masts were likewise 
restored.  In  the  interim,  ferry  and  bus  services  were  provided  to  minimise 
inconvenience  to  the  public.  The  project  also  included  an  information  campaign 
while guides were trained to provide information as well as site tours. By means of 
special  boat  excursions,  concurrent  restoration  could  be  viewed  at  various  works 
sites;  whereupon  the  restoration  in  itself  became  a  tourist  attraction  as  the  bridge’s 
history and restoration provided an impressive exhibition. 

Reducing poverty in the Dominican Republic 

The  Commission  contributed  to  reducing  poverty  and  improving  the  livelihoods  of 
500,000 slum dwellers in 16 marginalised neighbourhoods of Santo Domingo. Local 
communities  were  involved  to  improve  health and  sanitation  infrastructure,  as  well 
as the treatment and conservation of drinking water and solid waste management in 
the neighbourhoods concerned. The project has taken into account the socio-cultural 
needs  of  the  communities  and  has  fostered  participatory  approaches  to  create 
ownership. This has made the project efficient and sustainable. With the Commission 

EN 

58 

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contribution  of  €21.8  million,  pollution  gene rated  by  garbage  and  water  waste  has 
been reduced significantly. Likewise, the drinking water distribution system has been 
improved. Likewise, 44.7 kilometres of new pipe-systems as well as works on water 
management and control have improved sanitation and health of the local population. 
For  the  collection  of  garbage  some  micro-enterprises  have  been  created.  These 
micro-companies  are  managed  locally  and  continue  to  produce  revenue,  which 
makes them and the entire project sustainable in the long run. 

2.2.4.  Pacific (incl. OCTs) 

2.2.4.1.  Introduction 

Melanesia  gradually  began  to  calm  after  the  shocks  of  2003-2006  breakdown  of 
government control in the Solomon Islands; political turmoil in Timor Leste; a fourth 
coup d'état in Fiji. The Commission supported the Regional assistance Mission to the 
Solomon Islands, stabilisation and recovery in Timor Leste, and political dialogue for 
a return to democracy in Fiji under Article 96 of the Cotonou Agreement. Following 
rioting in Tonga, Polynesia was the subject of close monitoring during the year. 

Several major events marked EU-Pacific relations, including the launch of a regular 
EU-Pacific  Islands  Forum  (PIF)  to  support  political  dialogue  on  issues  such  as 
security and governance, economic growth and international trade, the environment 
and  development  cooperation.  The  dialogue  will  consist  of  a  triennial  Ministerial 
Troika  in  Brussels  and  annual  Senior  Officials’  Meetings  in  Suva  (Fiji)  as  the 
Headquarters of the PIF Secretariat. 

Economic  Partnership  Agreement  (EPA)  negotiations  led  to  a  Pacific  ACP  Interim 
Agreement  on  23  November,  currently  signed  by  Papua  New  Guinea  and  Fiji  but 
open  to  signature  by  all  Pacific  ACP  countries.  This  opens  the  way  for  a 
comprehensive EPA (including services, fisheries and investment) to be finalised in 
2008. As regional programming was synchronised with EPA negotiations, it can now 
proceed  on  the  basis  of  this  core  agreement  as  well  as  the  broader  arrangements 
identified. This will ensure that adequate development assistance is in place to flank 
trade commitments. 

2.2.4.2.  Aid effectiveness and donor coordination 

(1) 

On the basis of the European Consensus, synergies were sought with Member 
States (France,  the  UK, Germany and Ireland) notably to secure appropriate 
levels of Aid for Trade, as well as to help achieve the MDGs and to form an 
internationally  significant  alliance  in  the  area  of  climate  change,  aid 
effectiveness and donor coordination. 

In line with the priorities identified in the 2006 Commission Communication on EU 
relations  with  the  Pacific  Islands30,  some  important  steps  were  taken  to  implement 
the principles of aid effectiveness. The government of the Solomon Islands signed a 
the  Commission  and  New  Zealand's 
Memorandum  of  Understanding  with 
International  Aid  and  Development  Agency  to  enhance  effectiveness  of  the 
education sector reform programme by promoting country ownership and alignment 

30 

COM (2006)248 final 

EN 

59 

   EN 

                                                 
with  national  strategies  as  well  as  harmonisation  and  mutual  accountability  for 
development results. The Commission increased harmonisation by promoting the use 
of  co-financing  arrangements.  The  Commission  signed  two  agreements  with  the 
World  Bank  to  support  public  financial  management  reforms  in  Timor  Leste  and 
rural development in the Solomon Islands. A contribution agreement with the Asian 
Development Bank provided for post tsunami reconstruction in the Solomon Islands 
in response to tsunami of April. 

2.2.4.3.  Working towards the MDGs 

A lack of reliable data makes it difficult to measure the region's progress towards the 
MDGs. Nonetheless, it is possible to identify some areas where it is forging ahead. 
Primary  school  enrolment  is  relatively  high.  Fiji,  Kiribati,  Samoa,  Tonga  and 
Vanuatu currently enjoy enrolment rates of over 95%. However, quality of education 
and  drop-out  rates  remain  important  issues  to  resolve.  The  Commission  has 
continued  to  support  education,  both  at  national  and  regional  level  through,  for 
instance, the Pacific Regional Initiatives for the Delivery of Basic Education. 

Progress  towards  gender  equality  and  empowerment  of  women  has  been  made  but 
disadvantages remain. In 2007, special policies and programmes were designed and 
implemented  to  address  this  deficit.  For  example,  Papua  New  Guinea  was  selected 
for  a  joint  Commission/UN  partnership  on  Gender  Equality  for  Development  and 
Peace. 

Despite  improving  health  indicators  in  most  of  the  region,  significant  regional  and 
sub-national disparities remain. Support for improving health infrastructure has been 
provided to Kiribati, Tonga and the Cook Islands. Papua New Guinea received US$2 
million under the Global Fund to fight HIV/AIDS, TB and Malaria. 

2.2.4.4.  Regional cooperation and integration 

The Pacific Islands Forum, supported by its network of regional agencies belonging 
to  the  Council  of  Regional  Organisations  in  the  Pacific  (CROP),  has  achieved 
notable successes with regard to aligning regional policies and programmes on issues 
such as climate change, fisheries and non-proliferation. The Pacific Plan, adopted by 
the  Pacific  countries  in  2005,  is  the  main  instrument  for  promoting  regional 
integration.  It  identifies  priority  initiatives  under  the  four  inter-related  goals  of 
economic growth, sustainable development, good governance and security. The EU's 
regional policy supported the Pacific Plan by establishing a regular political dialogue 
as  well  as  contributing  to  specific  areas  such  as  trade,  education  and  training, 
fisheries,  agriculture,  tourism  and  environmental  protection.  Political  dialogue  will 
continue  in  2008,  most  notably  in  the  areas  of  regional  security  and  governance, 
economic stability and growth, international trade and environment. The finalisation 
of a regional cooperation strategy is envisaged for 2008. High priority will be given 
to natural resources conservation, regional integration, and trade. 

A WTO-compatible goods-only interim agreement has been signed with Papua New 
Guinea  and  Fiji,  the  two  countries  which  account  for  virtually  all  goods  trade  with 
the  EU.  A  full  regional  EPA  adding  fisheries,  services,  rules  and  appropriate 
development  provisions  is  expected  to  be  concluded  by  the  end  of  2008. 
Programming  for  the  10th  EDF  regional  programme  ran  in  parallel  to  EPA 

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negotiations and by the end of 2007 the grounds for a regional indicative programme, 
to be concluded in 2008, had been laid. 

2.2.4.5.  Implementation 

By  the  end  of  the  year,  a  total  of  €122  million  had  been  committed  under  the  9 th 
EDF. This included the additional allocations provided to some Pacific countries and 
OCTs  following  the  end  of  term  review  as  well  as  the  provisions  to  support  EPA 
negotiations  and  agricultural  exports  worth  €10  million.  The  greatest  share  of  EDF 
commitments  in  2007  was  devoted  to  government  and  civil  society  support  (28%). 
Water projects accounted for 22% of new programmes, followed by environment and 
education with 10% each. Under the EDF in the Pacific, the combined commitments 
totalled €362 million while payments to talled €258 million in the period 2002-2007.

On the Solomon Islands, the Commission delivered essential equipment and training 
to  the  national  Competent  Authority  to  strengthen  its  capacity  to  certify  the 
compliance of fish products in line with EU health and sanitary regulations. In Papua 
New Guinea and Samoa the Commission has supported water supply and sanitation 
projects to reduce, for example, water-borne diseases. A Disaster Risk Management 
initiative has been launched in eight Pacific countries to respond more effectively to 
natural  disasters.  Vanuatu  saw  the  roll-out  of  two  major  programmes  to  foster 
economic  growth  by  supporting  33  producers'  associations  as  well  as  the  tourism 
industry. Harmonised regulations,  rules and procedures have been  developed in  the 
area  of  fisheries  stock  assessment  and  management  across  the  region.  Those 
measures have contributed significantly to the enhancement of fisheries management 
methods and safeguarding the depletion of natural resources. 

2.2.4.6.  Monitoring 

A  total  of  98  national  and  regional  projects  as  well  as  regional  programmes  were 
monitored  in  the  Pacific  region.  The  total  budget  of  the  operations  monitored  was 
€227 million. 

With an average score of 2.52 across all sectors, the performance of cooperation was 
on  track.  However,  the  score  has  significantly  decreased  since  2006.  This  is 
particularly  due  to  weak  performance  on  efficiency  and  sustainability  in  the  social 
infrastructure  and  services  as  well  as  production  sectors.  Monitoring  results  were 
used to improve project management and the design of future actions. 

Table 10 Pacific Monitoring Results per ODA Sector 

3,0

2,8

2,5

2,3

2,0

Social Infrastructure and Services

Production sectors

Relevance

Ef ficiency

Ef fectiveness

Impact

Sustainability

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2.2.4.7.  Perspectives 

The  9th  EDF  end-of-term  review  concluded  successfully  and  all  projects  were 
approved, including those financed from the additional €10 million allocated to the 
Regional  Programme  in 2006,  on  the  basis of the mid-term review. On 18 October 
Commissioner Michel, who was in Tonga for the 19th Post-Forum Dialogue, signed 
13 of the 15 country strategy papers and indicative programmes. Thus, programming 
of the 10th EDF is nearly finished. By the year’s end Timor Leste programming was 
finalised  and  the  10th  EDF  allocation  for  Fiji  will  be  programmed  based  on  the 
progress of the Cotonou Article 96 political dialogue. 

The  Commission  is  now  pursuing  a  strategy  that  builds  on  its  multi-country 
operations  experience  acquired  during  the  9th  EDF,  toward  mutual  learning  and 
creating  economies  of  scale.  To  ensure  implementation  modalities  are  coordinated, 
nine  of  the  smallest  Pacific  islands  adopted  the  same  focal  sectors,  namely  water 
and/or energy in an environmental perspective of sustainable development. 

For the period 2008-2013, €337 million have been earmarked so far for geographic 
cooperation at national level with the Pacific countries. In terms of sector allocations, 
the  largest  share  of  €118  million  is  to  be  provided  to  rural  development  and 
agriculture,  representing  35%  of  the  total  allocations.  Environmental  issues  will  be 
mainstreamed to ensure sustainable management of natural resources, notably in the 
water and energy sector, which is to be funded with approximately €93 million that 
makes up 28% of the overall commitments. 

Due to the small scale and remoteness of most Pacific countries, Vanuatu and Samoa 
so far are the only countries in the region to receive budget support. Further efforts 
are  needed  to  extend  the  use  of  this  aid  implementation  modality  in  the  region. 
Assistance  provided  through  general  or  sector  budget  support  under  the  10th  EDF 
will represent 10% of the allocation to the region. 

Social sector support in Tonga 

The social sector support project in Vava'u has successfully constructed schools and 
health centres and expanded and refurbished the staff quarters of the hospital, schools 
and health centres. The involvement of civil society in implementing the project has 
met  with  wide-spread  recognition  and  satisfaction  among  the  island  population. 
These  focused  investments  on  this  particular  island  of  Tonga  reached  their  final 
stages  by  the  end  of  2007  and  have  had  a  positive  impact  on  the  island’s  living 
standards. 

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Development in the Cook Islands 

This  project  aimed  to  raise  the  standard  of  social  services  delivery  in  the  outer 
islands.  The  stakeholders,  including  the  users  of  services  provided,  project 
management,  the  relevant  government  agency  and  private  sector  representatives, 
have  confirmed  improvements  to  the  teaching  and  learning  environment,  enhanced 
aesthetics,  increased  opportunities  for  distance  education,  an  improved  attitude 
towards  education,  improved  health  care  and  safety,  increased  income  and  instant 
access  to  medical  information  through  broadband  internet  access.  The  project  is 
having  a  significant  impact  on  gender  issues.  The  status  of  women  is  being 
promoted. Through a component for non-state actors, the project is benefiting groups 
mostly composed of women and youth. Environmental conservation and preservation 
of local cultural heritage are also supported. 

Table 11 EDF-Sector   Breakdown by sector of external aid financed on the European Development 
Fund (EDF) managed by EuropeAid in 2007

Commitments ( € million)

335 M€, 10%

462 M€, 13%

323 M€, 9%

372 M€, 11%

1 247 M€, 35%

Payments ( € million)

195 M€, 7%

557 M€, 20%

751 M€, 22%

852 M€, 30%

156 M€, 5%

274 M€, 10%

799 M€, 28%

Social Infrastructures: Education, Health,
W ater, Government & Civil Society,
Other 

Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services

Production : Agriculture, Forestry &
Fishing, Industry, Mining & C onstruction,
Trade & Tourism

Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food
Security

Others - Including Emergency
assistance, reconstruction relief

Social Infrastructures: Education, Health,
Water, Government & Civil Society,
Other 
Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services
Production : Agriculture, Forestry &
Fishing, Industry, Mining & Construction,
Trade & Tourism
Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food Security

Others - Including Emergency
assistance, reconstruction relief

Bilateral and Multilateral ODA/OA. Excl non-ODA/OA resources (Peace facility,…).

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Table 12 EDF-ACP   Breakdown by sector of external aid financed on the 
European Development Fund (EDF) managed by EuropeAid in 2007

Africa

Caribbean

Pacific

Overseas Countries & Territories

ACP Unallocated

Total

Commitments (€ 
million)

Payments (€ 
million)

2 427 

272 

142 

110 

538 

2 327 

247 

49 

34 

176 

3 489 

2 833 

Bilateral and Multilateral ODA/OA. Excl non-ODA/OA resources (Peace facility,…).

2.2.5.  Global Programmes 

The EU has maintained its support to peace in Africa through the Peace Facility for 
Africa. Launched  in  2004,  the Facility has so far helped to fund AU peace support 
operations and capacity building in the area of peace and security. The Commission 
has financed the AU Mission in Sudan to restore peace in Darfur with €305.6 million 
since 2004. It continued support to the Central African Republic and most recently to 
Somalia  where  €15.5  million  have  been  t hus  far  committed.  In  2007,  the  Peace 
Facility was replenished with an additional €139.2 million, bringing the total amount 
to €439.2 million of which €39.2 million came from EU Member States' additional 
voluntary contributions. Under the 10th EDF, the Peace Facility will be provided with 
€300 million for an initial three-year-period (2008-2010). 

In  2007,  the  ACP-EU  Water  Facility31  fully  committed  some  €500  million  to 
improve  water  and  sanitation  for  those  most  in  need.  About  80%  of  the  available 
funds  were  allocated  to  two  calls  for  proposals,  with  other  co-funding  actions 
absorbing the balance. They resulted in agreements to co-fund 175 water projects in 
50 ACP countries. When implemented, the projects will provide access to safe water 
for  20  million  people  and  improve  sanitary  conditions  for  nine  million  people. 
Outside the scope of the calls for proposals, financial support was granted to the Nile 
Basin  Initiative,  the  African  Water  Facility  and  the  EU-Africa  Infrastructure 
Partnership. 

Some  90%  of  the  €220  million  available  w ithin  the  scope  of  the  ACP-EU  Energy 
Facility32  were  allocated  to  a  call  for  proposals.  As  a  result,  a  total  number  of  75 
projects  in  38  ACP  countries  were  approved  with  large  amounts  allocated  for 
electrical  transmission  lines  and  hydropower  projects.  Funds  were  also  assigned  to 
actions  under  the  EU-Africa  Infrastructure  Partnership,  which  aim  to  provide 

31 
32 

For further information, visit http://ec.europa.eu/europeaid/water-facility 
For further information, visit http://ec.europa.eu/europeaid/energy-facility 

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institutional support to Central, Eastern and Southern African Power Pools and to the 
African Forum for Utility Regulators. 

The Intra-ACP programmes of the 9th EDF had been fully committed by the end of 
the year and implementation of activities will continue during the operational period 
of the 10th EDF. In 2007, the total commitments under the 9th EDF amounted to €407 
million.  Several  innovative  support  programmes  were  initiated.  The  Migration 
Facility received an allocation of €25 million from the 9 th EDF. The Natural Disaster 
Facility,  aimed  to  ensure  preventive  actions  and  regional  and  national  institutional 
capacity  reinforcement,  was  granted  €12  million.  ACP  states  have  been  offered 
capacity  building  support,  for  example,  on  the  implementation  of  multilateral 
environmental agreements and on rural development and trade related activities. 

Finally,  the  Commission  will  contribute  €19.5  million  to  an  innovative  programme 
that  deals  with  capacity  building  for  Multilateral  Environmental  Agreements 
(MEAs). The core component consists of MEA hubs placed with regional bodies in 
the  three  main  ACP  regions.  Other  components  provide  support  for  the  Clean 
Development  Mechanism,  both  to  ensure  investments  in  emission  reductions  in 
developing  countries  and  to  combat  desertification,  as  well  as  to  help  eliminate 
obsolete pesticides. 

The sectoral/thematic division of commitments: 

Table 13 
Social: Health/Education 
Institutional support/capacity building 
Natural Resources and Infrastructure 
Trade and Private Sector Support 
Coordination/Others 
Total 

Total commitments  
€567 million 
€89 million 
€323 million 
€115 million  
€20 million 
€1 114 million 

2.3. 

Development Cooperation Instrument  

2.3.1.  Asia 

2.3.1.1.  Introduction 

The  interdependence  between  EU  and  Asian  countries  has  reached  unprecedented 
levels,  and  strengthening  EU-Asia  relations  has  continued  to  be  one  of  the  EU’s 
external  policy  priorities.  The  overall  relationship  with  Asia  is  complex;  for  this 
reason,  the  EU  has  been  fostering  dialogue  and  cooperation  with  all  Asian  partner 
countries  and  numerous  sub-regional  partners  and  policy  forums.  To  further 
strengthen  political  and  economic  relations,  regular  summits  took  place  with 
individual  countries  and  within  the  ASEM  framework.  EU  and  ASEAN  Heads  of 
States  and  Governments  gathered  in  Singapore  on  22  November  to  celebrate  thirty 
years of formal EU-ASEAN relations and endorsed the EU-ASEAN Plan of Action. 
The tenth China-EU Summit was held in Beijing on 28 November and the 8th EU-
India  Summit  took  place  in  New  Delhi  on  30  November.  Furthermore,  the 
Commission has moved to negotiate free trade agreements with South Korea, India 
and ASEAN, as well as partnership and cooperation agreements with Asian partners. 

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to  economic 

The  EU  pursues  an  increasingly  close  relationship  with  Asia  by  going  beyond 
integration  and  deepening  of  political 
traditional  cooperation, 
cooperation. The strategic framework for the Commission’s actions in Asia is based 
on  the  Communication  Europe  and  Asia33,  which  concentrates  on  political  and 
security 
climate 
change/environment as well as socio-cultural affairs and regional integration within 
ASEAN.  Cooperation  and  policy  approaches  with  Asian  sub-regions  and  countries 
have  been  developed  through  a  series  of  follow-up  Communications  on  South-East 
Asia, India and China. 

development, 

economics, 

security, 

energy 

issues, 

Cooperation  activities  between  EU  and  Asia  are  financed  through  the  development 
cooperation  instrument  (DCI).  Assistance  to  partner  countries  should  support  the 
implementation of policies aimed to eradicate poverty and to achieve the MDGs. The 
Commission  adopted  18  individual  country  strategies  and  a  regional  strategy, 
covering  cooperation  with  Asia  for  the  period  2007-2013,  for  which  an  amount  of 
some €5.2 billion has been earmarked, and  implementation is underway. The EU also 
increasingly  finances  programmes  to  several  Asian  countries  through  the  industrial 
cooperation  instrument  (ICI),  which,  in  addition  to  traditional  developed  partners 
(including Japan and Korea), now includes five other countries and territories in the 
region. 

Although  during  the  year  Asia  progressed  towards  the  achievement  of  the  MDGs, 
poverty  remains  a  significant  challenge, as the region is still home  to  two thirds of 
the  planet’s  poor  people.  Nevertheless,  in  2007  Asia  surpassed  NAFTA  to  become 
Europe’s main trading partner, accounting for a third of Europe’s total trade flows. 
Moreover, European FDI in Asia amounts to a third of European investment abroad, 
and is growing. 

2.3.1.2.  Aid effectiveness and donor coordination 

Progress on aid effectiveness has been most encouraging in countries like Cambodia 
and  Vietnam,  but  also  in  Laos,  where  the  aid  effectiveness  agenda  has  been 
translated  into  a  national  commitment  with  strong  government  leadership.  The 
Commission contributed to donor coordination and dialogue with the governments of 
partner  countries,  taking  the  lead  in  working  groups  for  areas  like  the  education 
sector  in  Indonesia,  where  a  major  Commission  intervention  for  sector  budget 
support is being prepared, the education sector programme and the aid effectiveness 
subgroup on cost norms in Vietnam. In Burma/Myanmar, the Commission played a 
key  role  in  the  preparation  and  management  of  joint  donor  programmes  for  the 
Global  Fund  to  fight  HIV/AIDS,  TB  and  Malaria  (GFATM)  and  the  education 
sector. 

Together  with  local  EU  Presidencies,  the  Commission  contributed  to  initiatives  to 
implement  the  EU  code  of  conduct,  acting  within  the  existing  donor  cooperation 
frameworks.  In  Cambodia  the  EU  Road  Map  for  aid  effectiveness  adopted  in  2006 
has been implemented and in Indonesia an EU road map on assistance coordination 
and rationalisation was agreed. 

33 

COM(2001)469 final 

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DCI  has  encouraged  stronger  ownership  of  partner  governments  and  their 
cooperation  in  preparation  and  implementation  of  the  programmes.  Resources  are 
being  concentrated  on  fewer  strategic  priorities  and  sectors,  especially  education, 
health, governance and environment. It facilitates joint financing arrangements with 
other development partners, prompting more coordinated missions and approaches as 
well as a harmonised and more efficient dialogue – which is especially important in 
fragile  and  volatile  contexts  (Afghanistan,  Bangladesh,  Burma/Myanmar,  Nepal, 
Pakistan,  and  Sri  Lanka).  However,  progress  on  promoting  more  coordinated 
approaches and support to capacity development has been slower than expected. 

As  a  result,  the  proportion  of  aid  channelled  and  implemented  through  country 
systems is growing rapidly. In 2007 less than one third of Commission disbursements 
on  pre-2007  aid  commitments  were  paid  through  country  systems  (roughly  €200 
million).  However,  of  new  aid  commitments  (€330  million)  near ly  half  will  be 
disbursed  through  the  budget  system  of  beneficiary  countries.  The  practice  of 
establishing Project Implementation Units has been almost completely abandoned for 
new commitments. 

2.3.1.3.  Working towards the MDGs 

The 2007 MDG progress report for Asia and the Pacific concludes that "Asia is one 
of  the  world's  most  dynamic  regions  and  has  been  forging  ahead  on  many  of  the 
MDGs".  The  region  as  a  whole  is  found  to  be  on  track  for  reaching  the  targets  on 
reducing  extreme  poverty,  primary  education,  including  gender  parity  in  primary 
enrolment, as well as mortality of under-fives. Progress is less satisfactory for HIV, 
AIDS  and  tuberculosis,  access  to  water  and  sanitation,  underweight  children,  and 
deforestation.  There  are  huge  differences  in  performance  among  countries.  For 
instance, while China, Indonesia, Malaysia and Thailand have already met the target 
on reducing extreme poverty, the progress made by India and the Least Developing 
Countries  is  slow.  On  primary  education  South  Asia,  except  India  and  Nepal,  is 
progressing  slowly  even  though  it  approaches  the  goal.  Some  Asian  countries  are 
progressing too slowly on cutting under-five mortality. Several countries in Asia and 
South  East  Asia  are  advancing  too  slowly  on  underweight  children.  All  South  East 
Asian countries except Vietnam have continued to lose their forests. Access to safe 
water in urban areas and to sanitation remains a problem, especially in rural areas. 

Under  the  new  DCI,  the  Commission  contributed  to  the  progress  of  the  Asian 
countries  towards  the  MDGs,  aligning  its  intervention  with  the  efforts  of  the 
beneficiary  country  government  policies  and  poverty  reduction  strategies  where 
possible.  Particular  priority  is  given  to  the  social  sectors:  health  and  education 
represent  18.3%  of  active  contracts,  but  25%  of  new  commitments.  The 
the 
Commission's  political  commitment  of  supporting  social  sectors  under 
geographical programmes covered by the DCI thus has a tangible impact in Asia.  

In 2007, the Commission committed funds to alleviate poverty and hunger (MDG-1) 
in  Cambodia,  Laos,  Mongolia  and  Vietnam.  Programmes  to  aid  uprooted  people 
were  adopted  for  Afghanistan,  Bangladesh,  Burma,  Thailand  and  Nepal,  and  food 
security programmes for Bangladesh, DPRK and Burma/Myanmar. The Commission 
allocated  funds  to  support  primary  education  (MDG-2)  in  Burma/Myanmar,  Nepal 
and Pakistan. 

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to  MDG  4,  5  and  6 

Through  health  sector  support  programmes,  the  Commission  has  directly  or 
in  Afghanistan,  Bangladesh, 
indirectly  contributed 
Burma/Myanmar,  India,  Indonesia  and  the  Philippines.  New  funding  was  provided 
for a health sector programme in India and the Global Fund to fight HIV/AIDS, TB 
and  Malaria  (GFATM)  in  Myanmar.  In  addition,  the  2007  regional  annual  action 
programme  includes  programmes  supporting  preparedness  to  highly  pathogenic 
avian  influenza  and  emerging  diseases  (MDG-6)  in  Asia.  Water  sector  reform 
programmes  were  completed  in  Afghanistan,  China,  and  India  or  at  Asia  regional 
level to ensure environmental sustainability (MDG-7). 

Through other programs, the Commission supported good governance and the rule of 
law.  New  programmes  were  committed  for  Afghanistan,  Bangladesh,  Indonesia, 
Laos  and  Vietnam.  Pursuance  of  the  MDGs  was  also  facilitated  through  the  new 
SWITCH  programme  which  strengthens  sustainable  consumption  and  production, 
thus  contributing  to  MDG  target  12,  goal  8  ("Develop  a  Global  Partnership  for 
Development "). 

2.3.1.4.  Regional cooperation and integration 

Supporting  ASEAN  and  SAARC  are  focal  areas  in  the  regional  strategy  paper  and 
multiannual indicative programme for Asia adopted this year. Assistance to ASEAN 
will focus on its integration efforts as outlined in the ASEAN economic community 
blueprint and will build on  European experience in  regional  integration issues such 
as statistics, customs and standards. Assistance to SAARC will support the SAARC 
Free  Trade  Agreement  process,  the  regional  sector  policies  developed  by  the 
organisation as well as the region's civil aviation safety standards. 

There  was  significant  progress  in  ASEAN,  with  adoption  of  the  ASEAN  Charter, 
including  charter  on  human  rights  and  three  blueprints  for  integration  at  the 
commemorative  summit  in  November,  followed  by  the  EU-ASEAN  summit.  The 
Commission adopted two new programmes the total €10.7 million budget value for 
which  support  statistical  capacity  development  and  improvement  of  migration  and 
border management. Implementation of a programme on IPR cooperation continued 
and  an  energy  facility  programme  was  completed.  The  energy  facility  has  been 
instrumental  in  putting  renewable  energy  on  the  agenda  in  the  ASEAN  member 
states  by  financing  a  large  number  of  demonstration  projects  and  also  in  bringing 
together  energy  policy  makers  from  the  region  to  define  regional  energy  policies. 
The  IPR  programme  has  created  a  strong  network  of  IP  offices  in  the  region, 
strengthened  legislation  in  ASEAN  member  states  and  established  curricula  for  IP 
management  at  universities  throughout  the  region.  EC  assistance  focused  in 
particular on capacity development and competency transfer on regional integration 
to the ASEAN Secretariat and respective national institutions of the member states.  

In  SAARC,  progress  in  cooperation  has  been  more  moderate.  However,  a  new 
programme  of  economic  cooperation  of  €2.5  million  aims  to  facilitate  the 
implementation  of  the  South  Asia  Free  Trade  Agreement  (SAFTA)  which  foresees 
that SAARC member states will harmonize their standards and abolish intra-regional 
customs tariffs. 

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2.3.1.5.  Implementation 

In  response  to  rapidly  rising  opportunities  and  demand  for  policy  and  reform-
oriented  development  cooperation,  over  recent  years  a  growing  proportion  of  EC 
development  assistance  in  Asia  has  been  provided  through  programme-based 
approaches  that  aim  to  support  countries  in  their  implementation  of  key  reforms, 
especially when related to the MDGs. In the first year of implementation of the DCI, 
roughly  two  thirds  of  EC  development  funds  for  Asia  (€652.9  million),  or  €477 
million,  were  committed  in  the  context  of  policy  and  reform-oriented  programmes 
and  projects,  many  of  them  in  partnership  with  other  donors  –  including  Member 
States. 

The  Commission's  contribution  to  eradicating  poverty  and  hunger  encompassed 
measures for food security in Afghanistan, Bangladesh, Burma/Myanmar and DPRK. 
DPRK  benefitted  from  the  delivery  of  agriculture  equipment  to  cooperative  farms 
and  the  start  of  three  new  community-based  food  security  projects  implemented  by 
European NGOs. Financial contributions were made to continue supporting Afghan 
returnees and refugees in neighbouring countries. Funds were also provided to assist 
Burmese  refugees  in  Thailand  and  Bangladesh  as  well  as  displaced  people  within 
Burma/Myanmar. The Commission also helped to find a long term solution for the 
Bhutanese refugees in Nepal. 

High-profile  higher  education  symposiums  and  fairs  in  three  Asian  countries 
promoted cooperation and exchanges between Asian and European higher education 
institutions  (Asia  Link).  Through  the  TEIN  programme,  about  30  million  Asian 
researchers from seven Asian developing countries so far (and fourteen expected in 
the future) are linked together and with Europe for data exchange and joint research. 

23.5%  of  new  commitments  were  for  health  related  actions,  including  additional 
support to the health sector in Burma/Myanmar and India. In  Burma/Myanmar, the 
Commission  contributed  to  the  Global  Fund  to  fight  HIV/AIDS,  TB  and  Malaria 
(GFATM),  which  aims  to  reduce  the  burden  of  communicable  diseases  on  the 
population.  In  India,  a  €110  million  contribu tion  to  a  health  sector  programme 
improves  the  quality  and  accessibility  of  health  services  with  particular  focus  on 
women  and  child  health  status.  At  the  regional  level,  the  Commission  delivered 
timely funding to support the multi-donor trust fund both for the prevention of Avian 
Influenza and for the fight against infectious diseases. The completion of the RHIYA 
programme  demonstrated  good  promotion  of  reproductive  health  among  youth  in 
Asia. 

Strengthening  the  rule  of  law  and  good  governance  is  a  major  focal  area  for  EC 
assistance  throughout  the  region.  In  Sri  Lanka  the  Commission  supported  the 
International  Independent  Group  of  Eminent  Persons  and  respect  for  human  rights. 
Support to public finance management was provided in Bangladesh, Cambodia, Laos 
and Pakistan. The Commission contributed €15  million to establish a comprehensive 
and  effective  voters’  registration  system  in  Bangladesh  to  help  ensure  that  the 
elections scheduled for end of 2008 will be fair and restore legitimate government. In 
Afghanistan,  the  Commission  contributed  to  the  reconstruction  and  process  of 
establishing rule of law. Further funding was provided for the Law and Order Trust 
Fund  financing  police.  Almost  €20  million  went  to  provide  support  for  the  Afghan 

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customs academy and construction of two border crossing points, thus contributing 
also to increasing revenues to the Afghan budget. 

The  Commission  committed  funds  to  support  sustainable  economic  and  social 
development  through  trade-related  assistance  in  SAARC,  Laos,  Philippines  and 
Vietnam.  At  the  regional  level,  the  Asia  Invest  programme  has  further  promoted 
cooperation in the field of SME development. Developing Asian countries have also 
benefitted  from  the  completion  of  Asia  Trust  Fund  for  targeted  trade-related 
technical assistance. In the area of rural development, a new sustainable livelihoods 
programme  for  Mongolia  was  supported.  The  Commission  committed  itself  to 
support capacity development in civil aviation in India. 

2.3.1.6.  Monitoring 

218  active  projects,  with  a  total  budget  of  €982  million,  were  monitored  in  Asia, 
resulting  in  213  monitoring  reports.  The  average  results  on  all  five  criteria  were 
above the middle line of 2.5, thus acknowledged as “being on track”. Projects in the 
areas  social  infrastructure  and  services,  multi-sector/crosscutting  and  production 
sectors account for 80% of all monitored projects and 77% of EC funding. 

The  effectiveness,  relevance  and  design  quality  as  well  as  the  sustainability  of 
programmes  implemented  in  the  Asia  region  remained  stable  between  2005  and 
200734. There is clearly scope for improvement, particularly as regards efficiency and 
impact.  The  identified  weaknesses  are  addressed  during  implementation  while 
lessons learned are taken into account in preparation of new programmes, especially 
as regards defining both realistic objectives and results, and relevant indicators, so as 
to ensure the ownership of the beneficiaries and the sustainability of the programmes. 

Table 14: Asia Monitoring Results per ODA sector 

3,0

2,8

2,5

2,3

2,0

Social Infrastructure and
Services

Economic Infrastructure and
Services

Production sectors

Multisector - Crosscutting Humanitarian Aid/Emergency

Assistance

Relevance

Efficiency

Effectiveness

Impact

Sustainability

Only  samples  of at least  10 monitoring  reports are considered statistically relevant, 
therefore no information is provided for those sectors having less than the minimum 
number of monitoring reports. The grading scale has a maximum of 4 points. 

34 

This conclusion is based on a sample of 18 re-monitored projects. 

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2.3.1.7.  Perspectives 

integration.  Beneficiary  ownership 

The Commission will further focus its external aid under DCI on MDGs and support 
to  regional 
is  crucial  for  success  and 
sustainability of aid programmes. The Commission will engage with other donors in 
policy  dialogue  with  governments,  so  as  to  ensure  that  the  necessary  policy  and 
regulatory  frameworks  are  in  place  to  facilitate  donor  assistance  success.  The 
Commission will also ensure that future programmes have more substantial capacity 
and institutional development components. 

Delivery on the aid effectiveness commitments and implementation of the EU Code 
of  Conduct  will  remain  priorities.  The  Commission  will  make  use  of  new 
opportunities  under  the  DCI  Regulation,  and  seek  the  support  and  engagement  of 
Member  States,  and  will  work  closely  with  other  donors.  Improved  donor 
coordination  will  allow  the  Commission  to  direct  its  interventions  further  toward 
better results and impact. The EC will aim to define better indicators for measuring 
progress and initiating disbursements. 

Post-tsunami reconstruction 

Three  years  after  the  tsunami,  the  European  Union,  acting  in  cooperation  with  the 
international community, is recognised as an effective partner in the implementation 
of  the  recovery  strategies  in  Indonesia,  Sri  Lanka  and  Maldives.  This  includes 
recreation  of  local  communities  and  livelihood,  rehabilitation  of  the  environment 
including  waste  management,  rebuilding  infrastructures  and  transports,  recreation 
and enhancement of capacity building and governance. 

General budget support in Vietnam 

Vietnam  was  one  of  the  first  countries  in  Asia  to  receive  General  Budget  Support 
(GBS).  GBS  in  Vietnam  is  directly  linked  to  the  country's  socio-economic 
development  plan.  Donors  provide  funds  through  non-earmarked  contributions. 
Coordination with EU Member States is very strong. The Commission and Member 
States  used  policy  dialogue  contributions  to  ensure  GBS  paid  close  attention  to 
poverty  reduction.  This  first  GBS  cycle  achieved  the  following  results:  The 
proportion of the state budget spent on education and health increased from 15% in 
2000  to  21%  in  2005.  This  additional  investment  contributed  to  noticeable 
improvements in basic education and health. All MDG targets in these areas are now 
on track. Primary school enrolments have increased by 6 percentage points. Under-
five  mortality  has  decreased  from  48  deaths  per  1000  births  to  24.  Access  to  clean 
water and sanitation has risen from 76% to 79% and 25% to 32% respectively. 

Sector budget support for health in the Philippines 

The Commission is the main donor to the governmental health sector policy support 
programme,  which  targets  primary  health  care  to  poor  people  with  a  particular 
emphasis on maternal health care. 16 provinces receive direct budget support and 21 
others  will  soon  be  covered,  including  provinces  of  Mindanao  affected  by  conflict. 

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The  first  fixed  tranche  was  paid  in  the  last  quarter  of  2007.  Reliable  data  for 
monitoring and evaluation of local government performance is being developed. This 
will provide the main input for the preparation of the variable tranche payment. The 
Commission  actively  participates  in  the  review  processes,  both  at  central  and  at 
provincial level. Budget support creates a spirit of partnership around policy issues, 
which  is  vital  to  pursuing  the  Commission's  objective  of  ensuring  equitable 
development that eliminates poverty. 

2.3.2.  Central Asia 

2.3.2.1.  Introduction 

The EU's recent enlargements, the extension of the ENP to the South Caucasus and 
development of its relations with Russia have brought Europe and Central Asia much 
closer together, both in terms of political cooperation and economic partnership. The 
strategic  interest  in  supporting  political  and  economic  stability  and  development  in 
Central  Asia,  particularly  given  the  region’s  proximity  to  Afghanistan  and  the 
presence of substantial energy resources in certain Central Asian countries also make 
the region an important partner. It had therefore become vital to strengthen the EU's 
relationship  with  the  five  Central  Asian  Republics  of  Kazakhstan,  the  Kyrgyz 
Republic, Tajikistan, Turkmenistan, and Uzbekistan. The common goal of achieving 
stability and prosperity by means of peaceful inter-action makes Europe and Central 
Asia partners for increased cooperation. 

On 21-22 June the European Council adopted a new Central Asia strategy, The EU 
and  Central  Asia:  Strategy  for  a  New  Partnership35,  which  marks  a  new  level  of 
political  dialogue  and  cooperation  with  the  countries  of  the  region  and  for  the  first 
time  establishes  guiding  principles  for  greater  EU  engagement  in  Central  Asia.  It 
focuses on intensified cooperation in key areas such as education; human rights and 
the rule of law; economic development, trade and investment; energy and transport; 
the  environment;  and  common  threats  and  challenges  from  terrorism  and  drug 
trafficking.  Meanwhile,  the  EU  is  supporting  energy  sector  reform  as  a  means  to 
underpin long term economic development in the region. 

The  Commission’s  2007-2013  assistance  strategy  for  Central  Asia36,  adopted  in 
April,  foresees  a  doubling  of  budget  allocations  to  €750  million  under  the  DCI. 
Eighty  percent  of  EC  assistance  is  directed  to  bilateral  cooperation  taking  into 
account the policy agenda of the individual Central Asia countries and their distinct 
political  and  social  realities,  with  a  focus  on  attainment  of  the  MDGs.  Twenty 
percent is going to regional challenges, such as preservation of the environment and 
water  management,  energy  and  transport,  border  management,  and  combating  drug 
trafficking.  The  alignment  of  priorities  for  Central  Asia  in  these  sectors  with  the 
regional ENPI strategy enables also the Central Asian partners to participate in ENPI 
regional projects. 

35 
36 

http://www.consilium.europa.eu/uedocs/cms_data/librairie/PDF/EU_CtrlAsia_EN-RU.pdf  
http://ec.europa.eu/external_relations/ceeca/c_asia/07_13_en.pdf 

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2.3.2.2.  Aid effectiveness and donor coordination 

The  Commission  made  further  efforts  to  promote  donor  coordination  and  aid 
effectiveness,  and  implementation  of  the  EU  code  of  conduct.  During  the  year,  the 
Commission  joined  a  group  of  donors  establishing  a  joint  intervention  strategy  in 
Kyrgyzstan  and  in  Tajikistan  in  support  for  implementation  of  national  poverty 
reduction  strategies.  Donor  coordination  in  these  two  countries  is  also  very  active 
around  public  finance  management  issues  –  an  area  in  which  the  Commission 
supports several projects. 

initiated  consultations  with 

The  Commission 
the  Member  States  regarding 
implementation of the EU strategy for Central Asia adopted in June. Fifteen percent 
of  the  aid  committed  in  2007  in  Central  Asia  will  be  delivered  through  country 
systems, thereby increasing ownership. 

2.3.2.3.  Working towards the MDGs 

According  to  the  MDG  2007  Progress  Report  for  Asia  and  the  Pacific,  several 
Central  Asian  countries,  such  as  Kazakhstan,  Kyrgyzstan  and  Uzbekistan,  have 
already  achieved  the  MDG  targets  related  to  reduction  of  extreme  poverty,  gender 
disparities  or  environmental  targets.  Despite  their  achievements,  Tajikistan  and 
Kyrgyzstan  remain  among  the  poorest  countries  in  Asia.  Improving  primary 
education  is  needed  in  most  countries  except  Kazakhstan  and  Tajikistan.  Further 
progress is needed, notably in the field of health water and sanitation in rural areas. 
Progress  as  regards  HIV/AIDS  is  recorded  in  Kyrgyzstan,  Kazakhstan  and 
Tajikistan,  but  surprisingly  this  is  not  the  case  for  tuberculosis,  for  which  the 
prevalence has increased in several countries. 

External  aid  under  the  DCI  contributes  to  the  fight  against  poverty  and  toward 
achieving  the  MDGs.  This  includes  sizeable  food  security  programmes  for 
Kyrgyzstan  and  Tajikistan,  with  a  total  budget  of  €18  million,  and  a  sector  policy 
support programme for social protection for Tajikistan. Projects include community-
based social development in rural Kyrgyzstan and one improving living standards in 
Tajikistan. 

The Commission also contributed to MDGs through its support and new funding to 
health  care  reform  in  Kazakhstan,  support  to  education  system  reform  in 
Turkmenistan  and  vocational  education  development  in  Kazakhstan.  The  Tempus 
and Erasmus Mundus programmes for Central Asia are of particular importance for 
the  development  of  Kyrgyzstan,  Tajikistan,  and  other  countries  that  suffer  from  a 
shortage of university graduates. 

2.3.2.4.  Regional cooperation and integration 

EU  cooperation  with  Central  Asia  developed  considerably  this  year  with  the  EU-
Central Asia ministerial meeting in Berlin in March and adoption of the EU Strategy 
for Central Asia as well as a Central Asia strategy paper and multiannual indicative 
programme.  The  strategy  paper  identifies  priority  areas  for  regional  cooperation, 
namely  education,  energy,  transport,  environment  and  border  management.  As  a 
response to the new EU strategy, the 2007 annual action programmes gave increased 
emphasis  to  education  (Tempus  and  the  Erasmus  Mundus  External  Cooperation 

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Window,  which  aims  to  boost  human  resources  development  through  student 
mobility) and to private sector development (Central Asia INVEST). 

2.3.2.5.  Implementation 

All new credits available for Central Asia (€60.3 million) were committed and €40.1 
million had been already paid by the end of the year. These commitments focus on 
health,  education,  judiciary  reform,  social  protection,  and  private  sector  and  rural 
development.  Most  assistance  was  provided  in  the  form  of  projects,  except  in 
Tajikistan where social protection received sector budget support. 

The  EU  supported  the  implementation  of  the  Partnership  and  Cooperation 
Agreements  with  Central  Asian  countries.  These  agreements  and  the  related 
development assistance aim to facilitate transition, as well as encouraging economic 
growth and trade. 

The regional Tempus programme continues to support education reform, curriculum 
development  and  university  modernisation  through  partnerships  between  higher 
education institutions. Vocational education and training is also supported in three of 
the  five  countries  so  as  to  help  the  population  access  new  opportunities  in  the 
growing  and  evolving  private  sector.  Strengthening  governance,  including  public 
finance management and economic transition reforms, is a major concern. Progress 
in  the  realisation  of  medium  term  expenditure  frameworks  has  been  achieved  with 
the  Commission's  help  in  Kyrgyzstan  and  Tajikistan.  Kazakhstan  benefited  from 
support to local governance. The Commission has continued to support civil society 
through 
Institution  Building  and  Partnership  Programme.  To  ensure 
environmental  sustainability,  the  Commission  has  contributed  to  the  successful 
protection of the Tadjik-Kyrgyz trans-boundary Pamir-Ali region conservancy area. 
It has also supported the Central Asia Regional Environment Center. 

the 

2.3.2.6.  Monitoring 

Table 15: Central Asia ROM Monitoring Results per ODA sector 

3,0

2,8

2,5

2,3

2,0

So cial Infrastructure and Services

Eco no mic Infrastructure and Services

M ultisecto r - Cro sscutting

Relevance

Efficiency

Effectiveness

Impact

Sustainability

Only samples of minimum 10 monitoring reports are considered statistically relevant, therefore no information is provided for 
those sectors having less than the minimum number of monitoring reports. Maximum grading is 4 points. 

A  total  of  99  active  projects  for  a  total  budget  of  €93  million  were  monitored, 
resulting  in  78  monitoring  reports.  Monitored  projects  covered  three  areas  that 

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represent  92.8%  of  all  projects  implemented,  namely  social  infrastructures  and 
services  (53),  economic  infrastructure  and  services  (24)  and  multi-sector/cross 
cutting  issues  (15).  The  relevance  (2.70)  and  efficiency  (2.73)  ratings  of  social 
infrastructure  and  services  projects  were  the  highest.  However  there  is  scope  for 
improvement,  especially  concerning  the  sustainability  of  bilateral  programmes  and 
the effectiveness of regional projects. This is the largest sector with 53 projects and a 
total budget of €50.7 million. 

The relevance, efficiency and effectiveness of national projects obtain higher marks 
than  the  regional  ones,  also  as  regards  impact  and  sustainability.  Most  regional 
projects  in  Central  Asia  are  managed  outside  the  region  (non-devolved)  –  often 
resulting in lower scores for relevance (2.5) and project design (2.7). The efficiency 
of non-devolved regional projects is less satisfactory (2.5) than that of national and 
devolved projects (2.8). However, these weaknesses are addressed in implementation 
while  lessons  learned  are  taken  into  account  when  designing  new  programmes  and 
further devolution of aid management to Delegation. 

2.3.2.7.  Perspectives 

The Commission will cooperate closely with EU member states in implementing the 
EU  Strategy  for  Central  Asia.  Support  for  achieving  the  MDGs  will  remain  at  the 
centre  of  assistance  to  the  region,  but  the  Commission  will  take  into  account  the 
increasing differentiation of the countries concerned. In response to the new strategy 
and  in  line  with  strategic  guidelines  under  the  DCI  Central  Asia  indicative 
programme  2007-2010,  new  regional  and  bilateral  cooperation  programmes  will  be 
implemented. High priority will be given to programmes in the field of education and 
rule of law/judiciary reforms, which are crucial for development and modernisation. 

Bilateral assistance will be further focused and consolidated, so as to provide more 
comprehensive  support  to  partner  countries'  medium-term  development  strategies. 
This will be linked with stronger engagement of the Commission, together with other 
donors,  in  policy  dialogues.  Commission  assistance  will  address  capacity  and 
institutional development, including strengthening of public finance management in 
Kyrgyzstan  and  Tajikistan,  as  a  way  of  helping  both  countries  in  meeting  all 
conditions for sector budget support and provision of assistance through their country 
systems. The Commission will continue support for addressing problems of concern 
for  the  entire  region;  establishing,  in  particular,  effective  border  management  and 
cooperation on water management. 

Integrated community-based development in Kyrgyzstan 

Poverty  levels  remain  extremely  high  in  Kyrgyzstan,  aggravated  by  significant 
regional  differences  in  economic  development,  particularly  between  the  richest 
region  of  Bishkek  and  the  poorest  southern  oblasts.  This  project  supporting 
integrated community-based development, therefore focuses on the poorest southern-
Kyrgyz  oblasts  of  Jalalabat,  Osh  and  Batken.  By  combining  economic  growth 
(through  agricultural  development,  income  generation  and  social  rehabilitation), 
social community empowerment and local administration strengthening, it addresses 
in  an  integrated  way  the  complex  nature  of  rural  poverty.  With  the  involvement  of 
the  local  population  in  the  project,  and  services  steadily  growing  throughout  the 
implementation, changes in living conditions were noticeable in all targeted areas. 

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Legal and trade-related assistance: post-soviet modernisation 

After  the  dissolution  of  the  USSR  and  regaining  its  independence  in  1991, 
Kazakhstan needed to draft and implement its own national legislation, to improve its 
investment  climate  and  to  raise  its  trade  volumes.  A  Commission-funded  project 
provided expertise in a number of areas to support these efforts. As a result, several 
pieces of legislation prepared through the project have been adopted and a significant 
contribution was made to the country's preparation for WTO accession. The project 
has benefited the public administration as well as the business sector. 

2.3.3.  Middle-East 

2.3.3.1.  Introduction 

Three countries in the Middle East are covered by the DCI – Iraq, Iran and Yemen. 
Substantial assistance was devoted once again over the year to reconstruction in Iraq, 
as well as to assisting neighbouring states (Jordan, Syria) to manage a major influx of 
Iraqi refugees, as the country remained extremely insecure. This insecurity, as well 
as  the  weakness  of  Iraq’s  institutions,  created  an  extremely  challenging  aid 
environment.  While  almost  half  of  Commission  funding  for  Iraq  was  channelled 
through the UN/World Bank multi-donor trust fund IRFFI, established at the end of 
2003,  bilateral  Commission  financing  was  also  given  to  a  major  new  rule  of  law 
assistance initiative, as well as to support displaced persons and refugees. 

In Yemen, the Government remained committed to its reform agenda – establishing a 
Supreme  National  Authority  for  Combating  Corruption,  adopting  a  financial 
disclosure  law  for  public  procurement,  and  reforming  the  civil  service  –  and  the 
Commission  maintained  its  support  for  that  process  by  increasing  the  Yemen 
allocation  under  the  DCI  budget  line  by  an  additional  €4  million.  The  overall 
situation  in  Yemen  remained  difficult,  with  continued  fighting  in  the  northern 
governorates and signs of social unrest amid rising food and fuel prices. Commission 
assistance  focused  on  good  governance  (electoral  and  democratic  support  as  a 
follow-up  to  the  2006  EU  elections  observation  mission)  and  on  local  community 
development through the Social Fund for Development. 

Finally, the Commission continued to support the EU3 negotiations with Iran in the 
hope  that  an  unblocking  of  the  nuclear  dossier  would  open  the  way  for  enhanced 
cooperation. 

2.3.3.2.  Implementation 

The Commission has supported Iraq reconstruction since 2003. EC aid concentrates 
on  fighting  poverty  through  alleviating  the  difficulties  encountered  by  the  Iraqi 
people.  The  programme  covers  all  areas  of  activity,  from  basic  services  to  human 
development and capacity building to support to the political process, with a special 
emphasis  on  elections.  So  far  most  EC  aid  has  been  channelled  through  the 
International Reconstruction Fund Facility for Iraq (IRFFI) as part of the multilateral 
effort.  This  approach  has  facilitated  the  deployment  of  EC  support  in  difficult  and 

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challenging conditions and very difficult security concerns where direct Commission 
actions would not be feasible. Efforts have also been made to launch bilateral actions 
with Iraq such as support to civil society organisations in the field of human rights 
and technical assistance to the key Iraqi institutions.  

This  year,  the  Commission  provided  support  for  the  rule  of  law  and  justice.  This 
builds  upon  the  experience  gained  already  in  this  sector  and  complement  the 
Integrated  Rule  of  Law  Mission  for  Iraq  (EUJUSTLEX)  supported  by  the  Council. 
Funds were also allocated to IRRFI to support the electoral process with the United 
Nations  Development  Group  Iraq  Trust  Fund  and  to  public  finance  management 
reform  with  the  World  Bank  Iraq  Trust  Fund.  Finally,  the  Commission  granted 
special  humanitarian  and  structural  support  for  the  provision  of  basic  health  and 
education services for Iraqi refugees in Syria and Jordan. 

As  Yemen  is  one  of  the  poorest  countries  in  the  world,  EC  cooperation  with  this 
country concentrates on supporting the provision of basic economic and social needs 
of  the  Yemeni  population.  In  2007,  the  Commission  supported  Yemen  through  a 
contribution to the Social Fund for Development. Created ten years ago, this fund is 
recognised  as  an  effective  agent  for  the  promotion  of  social  and  economic 
development. Promoting good governance and democracy is another key priority for 
cooperation  and  the  "Support  to  the  Electoral  process  and  Parliament"  programme 
will provide critical support to the democratic process and institutions. 

Despite  a  difficult  political  context  for  the  cooperation  with  Iran,  the  four  existing 
projects  promoting  good  governance  and  human  rights  (essentially  through  UN 
organisations)  proceeded  satisfactorily.  In  addition,  a  project  in  the  field  of  drug 
rehabilitation started early in the year. 

Iraq: Learning, informing, healing, reintegrating 

Iraq  has  a  long  history  of  arbitrary  arrests  and  the  use  of  torture  in  prisons.  NGOs 
working in this field have noted the widespread problem of ill-treatment of prisoners, 
torture  and  the  prevalence  of  arbitrary  detention.  Allegations  refer  to  restriction  on 
access to economic and social rights such as education and health care, harassment 
and mistreatment of women. The Commission has been supporting the promotion of 
a human rights culture in Iraq by supporting civil society human rights organisations. 

A  project  entitled  Promotion  of  Human  Rights  in  Iraq  through  Iraq  Civil  Society 
Organisations  is  implemented  by  the  United  Nations  Development  Programme 
(UNDP)  and  the  United  Nations  Office  for  Project  Services  (UNOPS),  in 
collaboration  with  Un  Pont  Per  and  in  partnership  with  the  Al  Fuad  Rehabilitation 
Centre for Torture Victims. This project aims to assist torture victims through social 
and  medical  rehabilitation  and  psychological  and  physical  support,  providing 
capacity  building  on  human  rights  and  detention  in  Iraq  and  organising  specialized 
capacity building trainings for Iraqi civil society organizations. 

The project has already produced some very positive results, including rehabilitation 
services  for  453  victims  (including  148  torture  survivors),  specialised  training  for 
surgeons and surgery for 130 ear amputees, the establishment of the Justice Network 

37 

www.jnpiraq.net 

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for Prisoners comprising 30 NGOs and the creation of a specific website37. 

2.3.4.  Latin America 

2.3.4.1.  Introduction 

Latin  America,  together  with  the  Caribbean,  saw  the  fifth  consecutive  year  of 
economic  growth  and  the  fourth  year  of  growth  over  4%.  Unemployment  fell  to 
around 8%, the lowest rate in 10 years38. This favourable economic situation had a 
positive impact on the activities the Commission implemented during the year. The 
overall  objective  of  these  was  to  promote  political,  economic  and  commercial 
relations and cooperation in order to consolidate the EU's strategic association with 
Latin  America  to  support  the  development  of  a  stable,  democratic  and  prosperous 
region. 

For  the  period  2007-2013,  €2690  million  have  been  allocated  for  development 
cooperation, which is crucial for establishing closer links between the EU and Latin 
America.  The  DCI  states  that  Community  assistance  should  support,  generally,  the 
implementation  of  policies  directed  toward  poverty  eradication  and  toward  the 
achievement  of  the  MDGs.  With  regard  to  Latin  America,  the  DCI  states  that  the 
main  objectives  are  to  support  social  cohesion  and  regional  integration,  the 
reinforcement  of  good  governance  and  public  institutions,  a  common  EU-Latin 
America higher education area, and to promote sustainable development. 

Within  this  framework,  several  strategic  priorities  were  established.  These  include 
maintaining  the  high  level  of  political  dialogue,  both  at  regional  and  sub-regional 
levels  (Mercosur,  Andean  Community,  and  Central  America).  Important  meetings 
held during the year included the Rio Group meeting in Santo Domingo as well as 
the  sub-regional  Ministerial  summits  that  were  organised  on  the  same  occasion. 
Under the DCI, 21 strategy papers for Latin America for the period 2007-2013 were 
adopted – taking into account that development policy should have a particular focus 
on  poverty  alleviation  and  social  cohesion  issues39.  Health  and,  more  significantly, 
education,  represent  about  30%  of  the  sectoral  focus  of  future  cooperation.  This 
honours the Commission's political commitment in terms of financial allocations to 
social  sectors  under  the  geographical  programmes  covered  by  the  DCI.  Several 
annual  action  programmes  were  prepared.  For  2008,  particular  emphasis  will  be 
given to sector-wide approaches and policy dialogue with Latin-American countries. 
Pursuing  its  integrated  trade  policy  in  Latin  America  and  focusing  on  creating 
economic and social opportunities through trade and aid, the Commission continued 
negotiations for the conclusion of the Mercosur agreement and launched negotiations 
in  view  of  comprehensive  Association  Agreements  (political  dialogue,  cooperation 
and  preferential  trade)  with  the  Andean  Community  and  with  Central  America. 
Several rounds of negotiations took place during the year. 

38 

39 

On  the  basis  of  the  ECLAC  (UN  Economic  Commission  for  Latin  America  and  the  Caribbean) 
preliminary analysis for the year 2007. 
For  17  countries,  3  sub-regions  (Central  America;  Andean  Community  and  Mercosur)  and  1  for  the  Latin-
American region as a whole 

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2.3.4.2.  Aid effectiveness and donor coordination 

Increasing co-ordination with other donors continues to be a priority, with particular 
attention to co-ordination with Member States. The Commission promotes, organises 
and  is  involved  in  regular  meetings  with  Member  State  representatives  and  other 
donors  to  exchange  lessons  and  to  ensure  coherence  between  its  policies  and  other 
cooperation activities  and  programmes.  Sector  approaches  have  encouraged  a  more 
harmonised and effective pooling of development potential. 

The Commission put into action many activities to adapt the EU Code of Conduct on 
division  of  labour  in  the  field  with  beneficiaries  and  donors.  In  Nicaragua  the 
Commission and Member States donors started to implement elements of the Code. 
In Peru, the Commission ensured that the government, through the Peruvian Agency 
for  International  Cooperation  (ACPI),  took  full  part  in  the  entire  aid  effectiveness 
programme  and  established  its  leadership  role  for  donor  coordination  and  the  Paris 
agenda. 

2.3.4.3.  Working towards the MDGs 

According  to  the  Millennium  Development  Goals  Report  200740  the  region  as  a 
whole has already met at least five of the MDG targets. In other areas progress has 
been  rapid  enough  to  put  Latin  America  on  track  to  meet  the  2015  deadline. 
Nevertheless,  tackling  income  inequality,  one  of  the  highest  among  all  developing 
areas, and the very high unemployment rate among young people, remain challenges. 
Another very important region-wide issue is that the proportion of land covered by 
forests has declined from 50 per cent in 1990 to 46 per cent in 2005. 

This  year,  the  Commission  financed  a  €7.3  million  programme   strengthening 
institutional  capacities  of  selected  municipalities  to  reduce  poverty  in  the  Northern 
and  North-Eastern  regions  of  Brazil  (MDG  1).  Its  objective  is  to  improve  the 
technical  and 
institutional  capacity  of  small  and  medium-size  municipal 
administrations  to  plan,  finance,  manage  and  evaluate  programmes  and  projects 
directed  toward  urban  and/or  peri-urban  development,  poverty  reduction  and  social 
inclusion.  The  programme  will  also  disseminate  and  demonstrate  methodologies, 
experiences  and  best  practices  in  inter-municipal  association  and  civil  society 
participation  that  could  be  adapted  to  the  Brazilian  reality  and  further  incorporated 
into the national policies. 

The  implementation  of  a  €5.8  million  project  started  to  help  forest  management, 
support sustainable production and strengthen civil society in the Brazilian Amazon 
(MDG  7).  The  project  should  contribute  to  sustainable  development  of  the  area  of 
influence  of  a  major  road  in  the  state  of  Pará.  Activities  will  include  installing  a 
forest  monitoring  system  and  a  national  register  of  public  forests  to  support  the 
Brazilian  Forest  Service  (SFB)  and  the  National  Centre  for  Forest  Management 
(CENAFLOR). Local sustainable production will be supported through training and 
networking for producers, farmers and land technicians. The market for sustainable 
products  will  be  increased.  Civil  society  will  be  strengthened  by  promoting 
approaches based on dialogue and negotiation. 

40 

http://www.un.org/millenniumgoals/ 

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The  Commission  committed  €12  million  to  help  young  people  find  a  decent  job  in 
Argentina  (MDG  8)  by  broadening  access  to  high-quality  education  and  vocational 
training  opportunities  and  promoting  the  completion  of  secondary  education  and 
increased  labour  qualifications  of  young  people  from  16  to  29  years.  The  policy 
management  of  the  system  for  permanent  education  of  young  people  and  adults 
(EPJA)  will  be  strengthened  at  provincial  and  national  levels.  Secondary  education 
for young people and adults in 12 provinces will be improved, as will the relevance 
and  quality  of  the  training  offered  to  youths  and  young  adults.  Implementation 
should start in 2008. 

2.3.4.4.  Regional cooperation and integration 

The Latin American countries have embarked on regional integration processes that 
have already had a considerable impact. Within the developing world, Latin America 
as  a  region  is  in  lead  position  on  the  integration  path.  Regional  integration  is  a 
priority area for Commission support. 

Four  initiatives  were  approved  to  strengthen  integration  within  Mercosur  (EC 
contribution  €12  million) .  The  first  aims  to  build  institutional  capacity  and 
strengthening the role of the Mercosur Secretariat at a moment when the Secretariat 
assumes  new  responsibilities  such as the implementation of the Fund for Structural 
Convergence  (FOCEM).  The  second  aims  to  fortify  the  judicial  and  legal 
institutional  structure41.  The  third  concerns  Mercosur’s  Strategic  Plan  for  the 
Education Sector and contributes to the consolidation and expansion of the Student 
Mobility Programme (similar to Erasmus programme) for Mercosur undergraduates. 
The  last  initiative  aims  to  foster  joint  policies  and  strategies  in  the  field  of  the 
information society at the level of Mercosur to reduce the digital divide in the region 
and follows the adoption of the “Work Plan of Buenos Aires for Development of the 
Information Society” in May 2006. 

The  Commission  continued  to  support  the  General  Secretariat  of  the  Andean 
Community  and  launched  a  project  (EC  contribution  €6.5  million)  to  support 
economic  and  social  cohesion  within  the  region.  The  objective  is  to  improve  the 
capacity to formulate and implement regional economic and social cohesion policies 
by creating an Andean Centre of Excellence for Economic and Social Cohesion and 
financing  concrete  actions  in  transnational  and  cross-border  areas  that  demonstrate 
the positive impact of regional integration to Andean citizens and the added value of 
EC  cooperation.  This  follows  the  adoption  of  the  Andean  “Integrated  Social 
Development Plan” (PIDS) in September 2004. 

2.3.4.5.  Implementation 

The  Commission  approved  27  bilateral  cooperation  actions.  These  seek  to  foster 
social  cohesion  and  education,  strengthen  good  governance  and  institutional 
capacities, and encourage regional integration. In Central  America the Commission 
continued to move towards budget support as a privileged aid delivery method. 

41 

The official establishment of the Mercosur Permanent Court of Review in Asunción on 13 August 2004 
was the first landmark towards this direction. 

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Cooperation  with  Nicaragua  evolved  reasonably  well  in  the  first  year  of  the  new 
government of Mr. Ortega. Following a lengthy inception phase, needed to establish 
common ground, the Commission and the Nicaraguan government made substantial 
progress in several areas which resulted, in particular, in the commitment of around 
€20 million for new geographic actions at the  end of the year to support education, 
business and investment climate, and governance facility. In Nicaragua and Ecuador 
the Commission decided to deliver a total €26.9 million through two budget support 
actions  for  the  education  sector.  In  Bolivia,  the  Commission  launched  programmes 
worth  a  total  of  €36  million  to  support  th e  government's  efforts  in  reducing  the 
cultivation  of  coca,  promoting  sustainable  socio-economic  development  in  the 
producing regions and facilitating access of the population to basic social services. 

In Peru, a programme on local capacity building for the families of small producers 
in  the  Surrounding  Zone  in  the  Biosphere  Reserve  of  Manu  (ZAMANU),  in  the 
regions of Cusco and Madre de Dios, made great progress in achieving its objectives. 
The programme seeks to improve small farmers' opportunities for commercialisation, 
reduce  high  levels  of  poverty  and  malnutrition,  and  address  the  weak  institutional 
links  between  the  civil  society  organisations  and  local  and  regional  authorities.  So 
far, the situation of 420 out of 560 families has improved as concerns production and 
nutrition.  Ownership  among  the  families,  communities  and  bio-farms  is  high.  A 
regional  programme  for  Peru  and  Bolivia  supporting  economic  initiatives  and 
organisations of rural producers (OECA42), has allowed beneficiaries to comply with 
organic  production  standards,  to  guarantee  supply  and  to  increase  the  quantity  and 
quality  of  their  production.  Coffee  cooperatives  have  been  able  to  develop  initial 
payment  (in  Peru)  or  pre-financing  (in  Bolivia)  services  that  increase  their 
independence from other financing sources (banks, buyers, federations). 

In Guatemala's Huehuetenango department, small producers account for 10% of the 
coffee production (the remaining 90% - 600,000 bags – that the department exports 
are  produced  by  multinationals).  The  Commission  has  supported  these  small 
producers  in  obtaining  environmental,  social  and  organic  quality  certification.  The 
EC  programme  helps  producer  associations  to  manage,  process  and  commercialize 
directly (avoiding local intermediaries) their production for a better price. This is an 
opportunity  to  increase  the  revenues  of  the  families  concerned.  Furthermore, 
the 
production  diversification 
environment. 

improves  agricultural  practices  and  protects 

The regional cooperation programmes43 aim to develop closer and sustainable links 
between civil society in Latin America and Europe. This was a very successful year 
for the regional programmes, both in terms of results and impact. 

EUROsociAL  (EC  contribution  €31.3  million,  2005-2009) 44.  This  Programme  aims 
to contribute to increasing social cohesion in Latin America by developing national 
authorities’  capacities  to  formulate  and  manage  public  policies  in  that  area.  Over  a 
two year period, more than 600 institutions and nearly 4000 public servants – more 
than 80% from Latin America countries – have participated in the programme. It has 

42 
43 
44 

Organizaciones Económicas Campesinas 
http://ec.europa.eu/europeaid/where/latin-america/regional-cooperation/index_en.htm  
http://ec.europa.eu/europeaid/where/latin-america/regional-cooperation/eurosocial/index_en.htm  

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promoted the creation of sectoral networks of institutions and administrations active 
in public policy-making and advocacy. 

Alßan (Programme for Higher Education and Training Scholarships in the European 
Union for Latin American citizens: EC contribution €88.5 million, 2002-2010) 45. By 
the end of the year, the programme had awarded 3,319 grants to nationals of the 18 
Latin  American  participating  countries.  In  2007,  a  total  of  806  students  were 
awarded scholarships for an average of two years of study in a European institution. 
A new programme is being prepared within the framework of the new phase of the 
Erasmus Mundus programme (Erasmus Mundus 2009-2013). The Erasmus Mundus 
External Cooperation Window call for proposals published in 2007 (for the academic 
year  2008-2009)  promotes  academic  cooperation  and  mobility  of  students, 
researchers and academic staff between the EU and Brazil, Mexico and Chile. 

ALFA  (Latin  America  Academic  Training  Programme:  EC  contribution  €55.5 
million, 2000-2006)46. Out of 225 approved projects, 54 were still active. During the 
second half of the year, preparations began for phase three of the programme with an 
EC  allocation  of  €45  million.  Actions  will  in clude  'Joint  Partnerships'  of  European 
and  Latin  American  institutions  and  'Structural  Measures'  that  aim  to  reform 
education systems in Latin America. 

AL-INVEST  (EU-Latin  America  Trade  and  Investment  Promotion  Programme:  EC 
contribution €42.9 million, 2003-2007) 47. During the year, 46 projects were approved 
for the benefit of Latin American as well as European SMEs. Activities included the 
organisation  of  business  meetings  and  technical  assistance  and  capacity-building 
projects for private-sector organisations. By the end of 2007, over 42,000 SMEs had 
received assistance under the programme which has generated, since its creation 13 
years ago, more than €602 million worth of EU-LA business. 

EURO-SOLAR  (EC  contribution  €24  million,  2006-2010) 48.  Euro-Solar  aims  to 
reduce  poverty,  allowing  remote  rural  communities  without  electricity  access  to 
benefit from renewable electric energy. The programme’s total budget is €30 million, 
of  which  €6  million  is  provided  by  the  ei ght  beneficiary  countries  (Guatemala,  El 
Salvador, Honduras, Nicaragua, Ecuador, Peru, Bolivia and Paraguay). 

URB-AL (EC contribution €64 million, 2007) 49. The programme develops networks 
between  local  authorities  on  issues  of  local  and  regional  interest  to  promote  social 
cohesion. In phases 1 and 2 a total of 171 projects, in the framework of 13 networks 
have been supported. On-going activities are expected to finish by the end of 2008. 
The current phase 2 programme will be followed by a third phase for which an EC 
contribution of €50 million was allocated. 

OBREAL  (Observatory  of  EU-LA  Relations:  EC  contribution  €1.35  million,  2005- 
2007)50.  The  Observatory  is  a  network  set  up  by  23  academic  institutions  and 

45 
46 
47 
48 
49 
50 

http://ec.europa.eu/europeaid/where/latin-america/regional-cooperation/alban/index_en.htm  
http://ec.europa.eu/europeaid/where/latin-america/regional-cooperation/alfa/index_en.htm  
http://ec.europa.eu/europeaid/where/latin-america/regional-cooperation/al-invest/index_en.htm  
http://ec.europa.eu/europeaid/where/latin-america/regional-cooperation/euro-solar/index_en.htm  
http://ec.europa.eu/europeaid/where/latin-america/regional-cooperation/urbal/index_en.htm  
http://www.obreal.unibo.it/  

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research  centres  from  Europe  and  Latin  America.  It  aims  to  identify  partnership 
possibilities between the two regions in several key policy areas: trade and financial 
relations,  regional  integration,  democracy,  human  rights  and  the  rule  of  law,  social 
and  development  cooperation,  governance  and  multi-regionalism,  civil  society  and 
institution-capacity building. 

2.3.4.6.  Monitoring 

17 countries were visited and 224 projects monitored, of which 184 are active and 38 
are completed (and were the subject of ex-post monitoring). Two were sector policy 
support programmes. A large number of these projects (nearly 60%) were concentred 
in five countries (Colombia, Peru, Brazil, Nicaragua and Guatemala). 

99%  of  projects  with  an  EC  contribution  above  €1  million  were  monitored  against 
30%  of  projects  with  an  EC  contribution  under  €1  million.  The  average  financial 
amount is €5 million, although this figure va ries significantly (from €0.3 million to 
€57 million). In addition to monitoring repo rts and notes for the 184 active projects, 
with a total budget of €895 million, seven coun try reports (Brazil, Guatemala, Peru, 
Bolivia,  Nicaragua,  Colombia  and  Chile)  and  a  "Compendium  of  lessons  learnt" 
were produced. 

The overall average note of 2.81 reflects very good performance (based on a target of 
2.5 which means that projects are on track and where 4 is maximum note) compared 
with  results  in  2005  and  2006.  Projects  show  very  good  relevance  (2.86), 
effectiveness  (2.81)  impact  (2.85)  and  sustainability  (2.91)  and  good  efficiency 
(2.63).  The  scores  for  the  five  criteria  were  very  good  (a)  7%,  good  (b)  63%, 
problems  (c)  29%  and  serious  deficiencies  (d)  1%.  There  are  nine  projects  with 
serious deficiencies (against 32 projects in 2006) which represents only 0.5% of the 
total. 

The best results (2.88) were reached in social infrastructure and services (education, 
health, water supply, etc.), which represents nearly half of the projects and half of the 
budget  monitored.  The  second  best  performer 
is  multi-sector/crosscutting 
(environment-related, urban and rural development projects), which represents nearly 
a quarter of the projects and 20% of the budget monitored, with an average of 2.83. 
The production sector  came  third with an average of 2.73  while other sectors  were 
based on a sample too small to be representative. The criteria with the best scores in 
all sectors are: relevance, impact prospects and potential sustainability. This year by 
region, the Andean Community shows the best results with a score of 2.83, and by 
country the best results were achieved in Uruguay with 2.96. 

Table 16 Latin America Monitoring Results per ODA Sector 

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3 ,0

2 ,8

2 ,5

2 ,3

2 ,0

Social Infrastructure and Services

Production sectors

M ultisector - Crosscutting

Humanitarian Aid/Emergency
Assistance

Relevance

Efficiency

Effectiveness

Impact

Sustainability

2.3.4.7.  Perspectives 

EC cooperation with Latin America over the period 2007-2013 will contribute to the 
achievement  of  the  MDGs,  making  effective  use  of  the  DCI  in  promoting  social 
cohesion,  an  essential  condition  of  poverty  reduction,  and  supporting  regional 
integration. Cooperation will also focus on reinforcing good governance and public 
institutions,  supporting  a  common  EU-Latin  America  higher  education  area  and 
promoting sustainable development. 

The  Commission  will  seek  deeper  coordination  with  EU  Member  States. 
Coordination with other multilateral donors will also be reinforced. On aid delivery 
methods,  the  Commission  will  strive  to  make  greater  use  of  budget  support,  when 
and where the appropriate conditions exist, in order to strengthen ownership and to 
support beneficiary countries' national policies, accountability and procedures. 

In  2008  the  political  dialogue  between  the  two  regions  will  experience  one  of  its 
highest  moments  with  the  fifth  European  Union-Latin  America  and  Caribbean 
Summit of Heads of State and Government to be held on 16-17 May in Lima (Peru). 
The two key themes for the Summit will be (i) poverty, inequality, inclusion and (ii) 
sustainable development (environment, climate change and energy). 

Disaster Prevention in the Andean Community 

Since  March  2005,  the  EU  is  financing  the  PREDECAN  project  (EC  contribution 
€9.45  million)  that  supports  processes  direct ed  toward  disaster  reduction  in  the 
member  countries  of  the  Andean  Community.  The  project  focuses  on  five  issues, 
namely  to  help  national,  regional  and  local  governments  to  include  natural  disaster 
risk prevention in their policies and organisations at State level to reduce risks, share 
information  and  knowledge  about  risks  between  the  Andean  countries,  improve 
planning  and  development,  provide  education  and  training  and  implement  pilot 
projects.  The  project  has  already  had  a  positive  impact  on  risk  awareness  among 
technical  and  government  staff,  e.g.  the  staff  of  civil  defence  organisations  and  the 
planning  and  finance  ministries  in  the  four  Andean  countries.  The  ministries  of 
education  and  civil  defence  institutions  are  especially  interested  in  making  risk 
reduction a transversal theme in education. Pilot projects helping local governments 
to  manage  risk  reduction  in  an  integrated  way  began  in  September.  Following  the 
earthquake  of  15  August,  PREDECAN  supported  Peru's  Civil  Defence  with 

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professional advice on efficiency and sustainable reconstruction. 

Food Security in Bolivia 

In 1996 the EU started the Programa de apoyo a la seguridad alimentaria (PASA) 
food  security  support  programme  (EC  contribution  €80.6  million  until  2006), 
supporting policy making institutions and financing a wide range of projects in poor 
rural  municipalities.  These  projects  range  from  training  and  technical  assistance 
supporting  agricultural  productivity  and  irrigation  works  to  road  infrastructure  that 
benefited some 40,000 families in rural areas. Thanks to the programme, in the last 
decade Bolivia has developed a comprehensive view on food security, allowing for 
more  consistent  policy  formulation  and  the  targeting  of  interventions  to  the  most 
deprived. The programme substantially improved access to food and it helped reduce 
the  income  volatility  and  risk  vulnerability  of  the  peasant  population.  The 
programme  has  become  a  full-fledged  Bolivian  institution  that  has  been  recently 
decentralized,  endowing  it  with  a  greater  functional  autonomy.  This  recent 
government  decision  shows  maximum  national  ownership  and 
long-term 
sustainability. 

2.3.5. 

South Africa 

2.3.5.1.  Introduction 

The  programming  of  development  cooperation  for  the  period  2007-2013  was 
concluded  with  the  adoption  of  a  country  strategy  paper  and  a  multi-annual 
indicative programme. The strategy paper was for the first time elaborated jointly by 
the  Commission,  South  Africa  and  eleven  EU  Member  States.  The  strategy  paper 
defines  the  reduction  of  poverty  and  inequality  as  the  overriding  objective  of  the 
development  cooperation  between  South  Africa  and  the  EU  for  the  period  2007-
2013.  The  indicative  programme  translates  this  joint  response  into  a  Commission-
South  Africa  programme  of  action.  It  foresees  an  indicative  allocation  of  €980 
million  for  the  seven-year  period.  It  was  approved  by  the  European  Parliament  and 
signed  in  Pretoria  on  the  10th  of  October  by  Commissioner  Michel  and  Finance 
Minister Trevor Manuel. The main areas of cooperation are employment creation and 
capacity  development  for  service  delivery  and  social  cohesion.  Other  areas  include 
governance and regional and pan-African support. 

The overall relations between South Africa and the EU have been strengthened with 
the  adoption  in  May  of  an  action  plan  for  implementing  the  strategic  partnership, 
which  calls  for  deepened  political  dialogue  and  political  cooperation  and  seeks  to 
develop cooperation in a wide range of areas. 

2.3.5.2.  Aid effectiveness and donor coordination 

Under  the  leadership  of  the  National  Treasury,  the  South  African  government 
convened donors to share experiences in putting the Paris Declaration into effect. An 
evaluation  has  been  launched  to  prepare  for  the  Accra  High  Level  Forum  on  Aid 
Effectiveness in 2008. Five donor coordination groups have been established to map 
donor  activities  and  to  engage  with  the  government  on  the  policy  framework  and 
programmes of action. 

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2.3.5.3.  Working towards the MDGs 

South Africa  is likely  to  achieve  most  of the  MDGs by  2015.  However,  due  to the 
high  levels  of  unemployment,  difficulties  remain  in  relation  to  poverty  eradication. 
Increased government spending on social services, including social grants, has gone 
some way towards alleviating poverty amongst the poorest households. Nonetheless, 
mass poverty remains pervasive with just under 50% of the population living under 
the poverty line established by the South African government. Institutional reforms 
are required to address unemployment and weaknesses in service delivery. 

2.3.5.4.  Regional cooperation and integration 

The  negotiations  for  an  Economic  Partnership  Agreement  (EPA)  led  to  intense 
discussions  on  regional  economic  integration,  intra-regional  trade  and  international 
trade.  South  Africa  already  has  a  WTO-compatible  free  trade  agreement  with  the 
EU51 as well as an agreement on trade in wine and spirits, that are unaffected by the 
expiry of the Cotonou trade regime. Therefore, it has chosen to remain outside of the 
agreement  for  the  time  being;  but  the  door  remains  open  for  it  to  join  the  SADC 
EPA. South Africa is expected to remain engaged in the negotiations towards a full 
EPA and to join the other SACU countries under a single trade regime in the future. 

2.3.5.5.  Implementation 

Sectoral budget support and sectoral policy support programmes accounted for more 
than half of the programmes approved this year. In total, disbursements worth €105 
million were made. 

Three  major  new  programmes  were  approved  that  complement  the  two  focal  areas 
for South Africa, namely employment creation and capacity development for service 
delivery. The programmes, worth €153 milli on, will be implemented mostly through 
sectoral  budget  support  and  will  contribute  to  achieving  the  MDGs  through  sector 
specific  support  to  local  economic  development  in  the  Eastern  Cape  (€16  million), 
"water for growth" (€107 million) a nd science and technology (€30 million). 

In  the  economic  sector,  two  major  sector  budget  support  programmes  for  private 
sector  development  have  been  implemented.  Beneficiaries  have  been  largely  small 
and  medium  size  enterprises.  This  resulted  in  the  creation  of  an  equity  fund  for 
women entrepreneurs as well as the establishment of ICT business centres delivering 
support  to  more  than  100  companies  to  better  prepare  for  local  as  well  as  global 
competition.  Three  local  economic  development  programmes  providing  grants  and 
technical support to small scale businesses have started to generate local employment 
and economic growth in the rural areas of three South African provinces. 

The  Conflict  and  Governance  Facility  supports  research  institutes  and  NGOs  to 
promote improved decisions on issues related to conflict and governance. Research 
financed  under  this  programme  has  already  contributed  to  better  informed  policy-
making  and  implementation  and  consequently  has  enhanced  good  governance  and 
democratisation in South Africa. 

51 

The Trade and Development Cooperation Agreement (TDCA) 

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2.3.5.6.  Monitoring 

Fourteen  projects  for  a  total  budget  €159  million  were  monitored,  showing  good 
results with an overall average score of 2.59 for all parameters. Five of the projects 
visited  were  being  re-monitored  and  four  of  them  showed  distinct  improvement  in 
the  overall  performance.  At  the  end  of  the  year,  a  large  monitoring  study  was 
conducted  on  the  whole  cooperation  portfolio  of  the  Commission  Delegation  in 
South Africa. This study was followed by two stakeholder workshops on the projects 
that  have  been  identified  as  "off-track".  If  successful,  this  pilot  exercise  might  be 
repeated by other Delegations with important portfolios at national or regional level. 

2.3.5.7.  Perspectives 

The  move  towards  budget  support  in  South  Africa  has  generated  more  efficiency, 
ownership and alignment with government policies. This trend is likely to continue 
in  the  future  as  it  will  further  enhance  the  sustainability  of  development  policies. 
Moreover,  a  strong  emphasis  will  be  placed  on  multilateral  donor  coordination, 
especially with EU Member States and the European Investment Bank. Preparations 
for the larger programmes to be financed in 2008 began this year. 

MDG 7 reached 

The  introduction  of  innovative  approaches,  systems  development,  access  to 
international  best  practice  and  capacity  development  have  enabled  South  Africa  to 
achieve  the  target  of  the  MDG7  long  before  2015;  i.e.  to  reduce  by  half  the 
proportion  of  people  without  access  to  safe  drinking  water.  The  European 
Commission  has  contributed  significantly  to  this  success.  The  third  water  sector 
support programme alone provided for the supply of water to one million people and 
basic sanitation to 250.000 people. 

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Table 17 DCI - Geo-Sector   Breakdown by sector of external aid financed on the General Commission 
Budget managed by EuropeAid in 2007

Commitments ( € million)

121 M€, 9%

173 M€, 13%

143 M€, 11%

720 M€, 52%

112 M€, 8%

93 M€, 7%

Payments ( € million)

210 M€, 16%

103 M€, 8%

608 M€, 49%

Social Infrastructures: Education, Health,
W ater, Government & Civil Society,
Other 

Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services

Production : Agriculture, Forestry &
Fishing, Industry, Mining & C onstruction,
Trade & Tourism

Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food
Security

Others - Including Emergency
assistance, reconstruction relief

Social Infrastructures: Education, Health,
Water, Government & Civil Society,
Other 
Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services
Production : Agriculture, Forestry &
Fishing, Industry, Mining & Construction,
Trade & Tourism
Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food Security

145 M€, 11%

144 M€, 11%

69 M€, 5%

Others - Including Emergency
assistance, reconstruction relief

Bilateral and Multilateral ODA/OA (EuropeAid only).

Table 18 DCI - Geo-Total   External aid financed on the 
General Commission Budget managed by EuropeAid 2007

€ millions

2007

Commitments

         1 362    

Payments

         1 279    

Bilateral and Multilateral ODA/OA (EuropeAid only)

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2.3.6.  Accompanying measures for Sugar Protocol countries 

These measures cover the period 2006-13. They aim to help eighteen ACP countries 
traditionally exporting sugar to the EU (namely the signatories to the Sugar Protocol) 
to adjust to the new market conditions created by the reform of the EU sugar regime. 
The  legal  bases  for  this  specific  support  were  adopted  in  2006,  with  significant 
funding envisaged in the Financial Perspectives ((€1 244 million for 2007-2013, of 
which  €667,338  for  2007-2010).  This  budget  is  distributed  among  the  beneficiary 
countries  according  to  their  needs,  depending  on  the  level  of  impact  of  the  reform 
and on the importance of the sector in their economies. For the period 2007-2010, the 
Commission allocated 49%, 42% and 9% of the budget indicatively to the concerned 
Caribbean, African and Pacific countries, respectively52. 

EC  assistance  under  these  measures  is  country-specific,  based  on  their  adaptation 
strategies. It aims to strengthen the competitiveness of the sugar sector, where this is 
a  sustainable  process,  to  support  the  development  of  alternative  activities,  or  to 
mitigate broader impacts, in particular social and environmental. Programming of the 
assistance was finalised in 200753. For the 12 countries54 which had established their 
adaptation  strategy  in  2006,  the  assistance  strategy  adopted  in  2006  was 
complemented  in  2007  by  a  multi-annual  indicative  programme  for  2007-2010,  in 
conformity with the requirements of the DCI. The five countries55 which had not yet 
determined  their  adaptation  strategy  in  2006,  did  so  in  2007,  allowing  for  the 
Commission  to  adopt  an  assistance  strategy  for  2007-2013  and  a  multi-annual 
indicative programme for 2007-2010. 

This  year,  the  implementation  of  the  2006  financing  agreements  proceeded 
(satisfactorily,  at  least  from  the  perspective  of  disbursement  rates),  while  new 
financing decisions for the 2007 budget were adopted for all countries1. At this stage, 
it  is  too  early  to  assess  the  progress  in  implementation  of  the  strategies,  or  their 
social, economic and environmental impacts. 

As to the reform of the EU sugar regime, as planned, no further price reduction took 
place in 2007-2008 (beyond the 5% cut already applied to the reference price for raw 
sugar in 2006-2007). The impact of the EU price reductions on ACP economies, at 
this stage, also has to be seen in the context of the appreciation of the exchange rate 
of the euro against the dollar. 

Finally,  a  significant  change  in  the  EU-ACP  trade  regime  for  sugar  was  agreed  in 
2007,  with  the  conclusion  of  Economic  Partnership  Agreements  (interim  or 
complete). While upholding the commitment to duty free quota free access for LDC 
sugar  from  2009,  the  EU  will  offer  similar  access  to  all  ACP  sugar  from  2009  as 
well,  subject  to  a  specific  safeguard  clause  for  non-LDC  countries.  For  2008/09, 
zero-duty  import  quotas,  additional  to  those  of  the  Sugar  Protocol  and  of  the 
"Everything  but  Arms"  agreement,  have  been  granted  to  the  Caribbean  (60.000  T), 

52 
53 

54 

55 

C(2007)1688 
With  the  exception  of  Fiji,  due  to  the  political  difficulties  following  the  military  coup  in  December 
2006. 
Madagascar,  Malawi,  Mauritius,  Mozambique,  Swaziland,  Tanzania,  Zambia,  Barbados,  Belize, 
Guyana, Jamaica, St Kitts and Nevis. 
Trinidad and Tobago, Republic of Congo, Ivory Coast, Kenya, Zimbabwe. 

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the  Pacific  (30.000  T),  Eastern  and  Southern  Africa  (75.000  T),  the  East  African 
Community (15.000 T), and the Southern African Development Community (50.000 
T), for those countries that have initialled an EPA. A minimum price obligation for 
importers will be maintained until 2012. Considering this new trade regime between 
the EU and the ACP, the EU denounced the Sugar Protocol in 2007 (in conformity 
with its article 10), so that its existence terminates on 30 September 2009. 

2.3.7. 

Investing in people 

In  January  2006,  the  Commission  adopted  a  Communication  entitled  Investing  in 
People  on  the  thematic  programme  for  human  and  social  development.  The  DCI  is 
providing  just  over  €1  billion  for  this  pr ogramme  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  has  been  approved  to  support  activities  under  four  main 
pillars, namely 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, sport, and culture). 

Health 

The  Commission  pursued  its  efforts  towards  health  within  developing  countries 
using aid modalities in line with countries' specificities and its commitment to donor 
coordination,  leading  to  an  increasing  number  of  active  global  budget  support 
operations in ACP countries and an expansion of sector policy support programmes 
in  other  regions,  in  particular  Asia.  This  year,  the  Commission  joined  the 
International  Health  Partnership  that  aims  to  improve  donor  harmonisation  and 
coordination  in  several  selected  countries.  The  lack  of  human  resources  for  health 
has  become  more  critical  in  2007.  As  a  consequence  the  EC  is  increasing  its 
involvement in this field. For example, in Zambia the Commission is supporting the 
retention  of  human  resources  in  the  health  sector  through  sector  budget  support.  It 
has also committed €10 million to support the development of human resources for 
health in the African Portuguese-speaking countries. 

The  areas  for  support  financed  through  thematic  budget  lines  are  the  fight  against 
poverty-related diseases, the promotion of sexual and reproductive health and rights, 
as  well  as  addressing  crisis  concerning  the  human  resources  for  health.  Under  the 
thematic  programme,  the  Commission  made  a  contribution  of  €62  million  to  the 
Global  Fund  to  fight  AIDS,  TB  and  Malaria  as  part  of  the  larger  commitment  to 
contribute  €100  million  annually  from  bot h  the  EC  Budget  and  the  EDF.  The 
response to HIV/AIDS and other poverty diseases, such as malaria and tuberculosis, 
remains  an  important  priority.  The  Commission  also  supported  an  international 
conference on the control of cervix cancer in developing countries. The conference 
was a landmark as it brought together for the first time, politicians and policymakers 
from  around  the  world,  industry  and  regulators,  research  groups,  and  civil  society 
organisations  including  women’s  rights  groups.  The  Commission  supported  a 
comprehensive approach ranking from prevention to treatment while emphasising the 
need for further research on the relevance of promoting HPV vaccine in developing 
countries. 

Education, knowledge and skills 

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€22 million was made available to the Education For all Fast Track Initiative multi-
donor Catalytic Fund to increase financial resources in countries with a financial gap 
so  as  to  support  their  education  sector  plan  and  to  accelerate  the  pace  of  enrolling 
children in school, improving the quality of teaching and learning, and ensuring that 
students complete primary education. 

International aid is essential to consolidate progress towards education for all. It must 
be more predictable over a longer term, and target those countries most in need. The 
Fast Track Initiative (FTI) has become a key vehicle for this endeavour. It is a global 
partnership  between  donors,  developing  countries  and  civil  society  to  ensure 
accelerated  progress  towards  the  MDG  of  universal  primary  education.  All  low-
income  countries  which  demonstrate  serious  commitment  to  universal  primary 
completion can receive support from FTI. It also provides an important coordinating 
mechanism for donor agencies. 

FTI encourages the mobilization of financial resources in support of the development 
and  implementation  of  education  sector  plans  of  participating  countries.  Ideally, 
sufficient resources are made available directly by bilateral and multilateral partners 
in addition to increased domestic expenditure. When this is not possible, the FTI can 
provide transitional support from one of its two multi-donor trust funds: the Catalytic 
Fund  and  the  Education  Program  Development  Fund.  The  Catalytic  Fund  Strategy 
Committee  has  reaffirmed  that  this  fund  should  reduce  financing  gaps  that  cannot 
otherwise  be  filled.  Strengthening  country  level  processes  has  emerged  as  a  need, 
which can be addressed by focusing on four key issues, namely planning, appraisal 
and endorsement processes; donor coordination and harmonization; monitoring; and 
financing modalities. 

Gender 

This  was  the  first  year  of  implementation  of  two  projects  carried  out  by  UN 
organisations.  A  project  implemented  by  UNIFEM  aims  to  integrate  the  gender 
dimension  in  the  elaboration  and  analysis  of  the  budget  of  the  state.  A  project  in 
partnership  with  UNICEF  facilitates  the  abandonment  of  harmful  practices  such  as 
female genital mutilations. A call for proposals was launched to support civil society 
organisations that promote gender equality in the Mediterranean. 

Other aspects of social and human development 

Employment, social inclusion and protection 

With  EC  funding  of  €7.3  million,  a  contribution  agreement  with  the  ILO  was 
negotiated in order to implement two different innovative actions. The first supports 
governments  and  social  partners  in  low-income  and  middle-income  developing 
countries to have the tools and the capacity to monitor trends and measure progress 
on  decent  work  results  over  time  and  to  apply  high-quality  policy  analysis.  The 
second aims to manage labour market adjustment to maximise the benefits of trade in 
developing  countries,  specifically  to  improve  knowledge  of  the  effects  of  trade 
policies on employment, the quality of employment, the participation of women and 
men in employment, income, and the informal economy; with activities foreseen in 
several pilot countries all around the world. 

Culture 

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The  programme  provides  €50  million  to  culture  for  the  period  2007-2013  with  the 
objective  of  improving  access  of  local  populations  to  culture.  This  will  include 
strengthening  of  local  capacities,  intercultural  dialogue,  the  development  of 
platforms and networks to exchange expertise and good practices and the promotion 
of public-private partnerships. A first call for proposals was launched in December. 

Children's rights and needs 

This year, children's rights and needs became, for the first time, a specific chapter of 
EC  external  assistance  under  the  Investing  in  People  programme,  allowing  the 
Commission  to  have  a  more  focused  and  coherent  approach  on  children-related 
issues.  In  this  framework,  several  actions  were  initiated.  A  contribution  agreement 
was signed with UNICEF to prepare a comprehensive toolkit to address child rights 
in  European  development  cooperation  and  external  relations.  The  toolkit  aims  to 
support  the  implementation  of  the  UN  Convention  on  the  Rights  of  the  Child  as  a 
whole,  including  through  better  participation  of  children  in  policies  or  strategies 
concerning  them  either  directly  or  indirectly  and  by  improving  the  achievement  of 
the  Millennium  Declaration  and  its  goals.  Specifically,  the  capacity  of  targeted 
stakeholders  should  be  improved  to  identify  and  address  child  right  issues  in  their 
work and design more integrated and effective policies and programmes in the areas 
of  peace  building,  rehabilitation  and  development  cooperation  that  respect,  protect 
and fulfil those rights. The EC provided €3.5 million out of a total €4 million. 

Another contribution agreement was signed with ILO/IPEC to fight against the worst 
forms of child labour in the framework of conflict situations. It aims to contribute to 
peace building by preventing children to be recruited by armed forces and groups and 
to provide assistance to children trapped in the worst forms of child labour in conflict 
and  post-conflict  situations.  The  EC  contributed  €1.1  million  out  of  a  total  €1.3 
million.  Finally,  a  call  for  proposals  is  foreseen  for  an  amount  combining  €3.4 
million  from  the  2007  allocation  and  approximately  €10  million  from  the  2008 
allocation.  This  call  for  proposals  is  divided  into  two  lots,  one  addressing  children 
indirectly  affected  by  conflicts  (orphans,  displaced,  maimed,  etc)  and  the  other 
addressing children affected by the trafficking of human beings. 

2.3.8.  Non-State actors and local authorities in development  

Ownership and participation are core principles of EU development policy, as stated 
in  the  European  Consensus  on  Development.  The  Commission  plays  a  key  role  in 
facilitating  and  promoting  dialogue  between  state  and  non-state  actors  on 
development  priorities  and  strategies  in  partner  countries.  The  Commission 
continued its efforts to promote participatory approaches, considering civil society as 
essential actors of change. A new thematic programme, Non-State Actors and Local 
Authorities  in  Development,  replaced  the  NGO  co-financing  and  decentralised 
cooperation budget lines. Although its overarching objective is poverty reduction in 
the context of sustainable development, including the pursuit of the MDGs and other 
internationally  agreed  targets,  it  is  an  “actor-oriented”  programme  aimed  to  build 
capacity  through  support  for  "own"  initiatives  by  non-state  actors  and  local 
authorities in both the EU and partner countries. 

Throughout the year, the Commission engaged in discussions with Council and the 
European  Parliament  on  the  scope,  objectives  and  priorities  of  the  strategy.  This 

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refines  the  orientations  taken  in  the  DCI  and  defines  strategic  priorities  for  a  four-
year  period  (2007-2010).  Following  its  approval  on  21  June,  the  Commission  also 
adopted  its  annual  action  programme  2007  on  14  December  after  having 
systematically involved the key stakeholders in the Palermo process, Member States 
representatives,  Members  of 
the  European  Parliament  and  civil  society 
representatives. This structured "quadrilogue" with Commission services enables all 
parties  to  create  the  conditions  for  more  efficient  aid  delivery,  and  improves  the 
policy  formation  process.  Concrete  results  were  achieved  in  simplifying  certain 
administrative  procedures  for  awarding  projects,  taking  on  board  suggestions  made 
by  development  NGOs  with  regard  to  financial  rules  and  procedures.  On-line 
registration of potential applicants into a new data base, PADOR, has been launched. 
This  eases  the  administrative  burden  for  applicants  and  provides  the  Commission 
with a tool for improving both its knowledge and its understanding of the needs of its 
implementation partners. 

In the spirit of the Paris Declaration, the Commission funded the DECIM initiative, a 
light donor coordination mechanism in countries where institutional support to civil 
society  organisations  can  benefit  from  a  systematic  attempt  to  achieve  programme 
synergies  and  fill  development  gaps  in  five  critical  areas:  an  enabling  legal 
framework;  public  advocacy,  policy  dialogue  and  governance;  delivery  of  social 
services and creation of social capital; financial sustainability; and capacity-building, 
knowledge-sharing  and  networking.  The  Commission  also  selected  270  projects 
proposed by European development NGOs for a total contribution of €194.3 million. 
In addition, 58 projects to raise the awareness of the European public were supported 
for a total of €29.9 million; 22 of which, representing a contribution of €9.4 million, 
are to be implemented exclusively in the 10 new Member States that joined the EU in 
May 2004. 

2.3.9.  Migration and asylum 

This  year,  the  Commission  built  on  previous  progress  and  extended  its  external 
actions  in  the  area  of  migration.  For  example,  the  10th  EDF  allocated  increased 
funding  to  migration  and  it  was  the  first  year  of  the  thematic  programme  for 
migration  and  asylum,  which  has  been  allocated  €384  million  for  the  period  2007-
2013. This represents a substantial increase when compared with its predecessor, the 
AENEAS  programme  (€120  million  increase 
in  three  years).  Calls  for  proposals 
covering spending for 2007-2008 were launched (€27 million for the Southern route; 
€21  million  for  the  eastern;  €2  million  for  the  Middle  East  and  Gulf  States;  €6 
million for Asia and €6 million for Latin America and the Caribbean). A €15 million 
targeted  project  was  agreed  with  UNDP  on  the  links  between  migration  and 
development  and  a  €4  million  project  on  Asylum  with  UNHCR.  Other  activities 
included  the  launch  of  an  ACP  migration  facility  and  cooperation  platforms  in 
Eastern Africa. 

The work to enhance dialogue and cooperation on migration issues under the Global 
Approach with sub-Saharan and North Africa was further strengthened. At the same 
time,  the  Global  Approach  was  extended  to  the  eastern  and  south-eastern 
neighbouring  regions,  building  upon  and  reinforcing  existing  cooperation  in  these 
regions. International consensus and dialogue on migration was also made stronger. 
July saw the Global Forum on International Migration and Development; November, 
the Euromed ministerial meeting on Migration; while December, the second Africa/ 

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EU  summit  in  Lisbon.  The  Lisbon  summit  recognized  the  importance  of  migration 
and  the  Action  Plan  of  the  Joint  Strategy  contains  a  partnership  on  migration, 
mobility  and  employment.  The  Commission  played  an  integral  role  in  these  events 
and will continue to advance their follow up. 

The  Commission  adopted  a  report  on  Policy  Coherence  for  Development  in 
September, which also covers migration. Working towards the practical application 
of  policy  coherence,  the  Commission  ensured  that  all  new  country  strategy  papers 
include migration profiles. 

The Council Conclusions adopted in December welcomed the progress of the Global 
Approach  to  Migration  and  within  this  context  defined  a  suitable  approach  to 
mobility  partnerships  and  circular  migration.  Mobility  partnerships  will  be  piloted 
with Moldova and Cape Verde in 2008. 

2.3.10.  Environment and sustainable management of natural resources including energy 

Under the DCI, provision is made for a thematic programme for the environment and 
the sustainable management of natural resources including energy (ENRTP). A total 
budget  of  €889.5  million  has  been  foreseen  for  the  period  2007  to  2013.  In  the 
ENRTP  thematic  strategy  paper,  five  priorities  constituting  the  core  of  the 
programme  are  identified  for  the  first  programming  period  (2007-2010).  Supported 
with  a  budget  of  €469.7  million,  these  priori ties  (i)  work  upstream  in  assisting 
developing  countries  to  achieve  the  MDG7  on  environmental  sustainability;  (ii) 
promote the implementation of EU initiatives and help developing countries to meet 
internationally agreed environmental commitments; (iii) promote coherence between 
environmental  and  other  policies  and  enhance  environmental  expertise;  (iv) 
strengthen international environmental governance and policy development and, (v) 
support sustainable energy options in partner countries. 

The 2007 annual action programme was adopted by the Commission on 3 December 
with a budget of €79 million. Through calls  for proposals and several targeted project 
proposals,  this  action  programme  focuses  on  major  environmental  issues,  such  as 
climate  change,  desertification,  biodiversity,  forest  preservation  (including  the  EU 
Forest  Law  Enforcement,  Governance  and  Trade  –  FLEGT  –  initiative).  It  will 
support  capacities  enhancement  of  developing  countries  for  the  implementation  of 
Multilateral  Environmental  Agreements  (MEAs),  in  particular  the  United  Nations 
Framework Convention on Climate Change, the Convention on Biodiversity and the 
the  overall  objective  of  promoting 
Convention  on  Desertification.  Within 
international  environmental  governance,  the  2007  action  programme  provides 
support  for  international  negotiations  and  environmental  monitoring,  assisting  the 
operation  of  key  multilateral  environmental  agreements  and  other,  largely  UN, 
processes  and  supporting  coherent  international  policy  formulation  for  sustainable 
development. 

A specific programme on energy efficiency and renewable energy is also included. In 
the  context  of  the  EU's  general  policy  objectives  in  the  field  of  energy  to 
simultaneously win the battle against climate change, to eradicate energy poverty and 
to  secure  global  energy  supplies,  the  Global  Energy  Efficiency  and  Renewable 
Energy Fund (GEEREF) was created with an allocation of €25 million from the 2007 
budget.  The  objective  of  GEEREF  is  to  pool  public  and  private  funds  through  an 

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innovative public-private partnership so as to offer new risk sharing and co-funding 
options for various investors in the areas of energy efficiency and renewable energy. 
The  programme  also  supports  the  EU  Water  Initiative  and  EU  Energy  Initiative 
through  the  facilitation  of  policy  dialogue,  coordination,  analysis  and  consultation 
processes in the energy and water sectors at global, interregional, regional and sub-
regional levels. 

The ENRTP thematic programme complements environmental activities planned and 
implemented  under  the  external  cooperation  programmes.  While  the  latter  cover 
local actions, the ENRTP has a clear focus on actions of global or regional relevance. 
This  includes  activities  in  the  forest  sector  related  to  forest  governance  mainly 
through  actions  in  support  of  the  implementation  of  the  EU  FLEGT  initiative.  An 
ACP FLEGT support project for €10 million was  financed. In the area of biodiversity 
and  protected  areas,  the  Commission  continued  its  long-term  support  for  the 
conservation  and  sustainable  management  of  the  tropical  forest  in  Central  Africa 
(ECOFAC  programme)  through  the  implementation  of  the  fourth  extension  of 
ECOFAC (€38 million). The DRC, which repres ents nearly half of the tropical area 
in the region, gave a boost to the importance of ECOFAC by joining the programme. 

In Asia, support for a €100 million program me called SWITCH will help the region 
to  move  towards  more  sustainable  consumption  and  production  practices,  while 
promoting trade in environmental goods and services. SWITCH-Asia supports ‘green 
growth’  and  the  development  of  environmental  technology.  It  focuses  on  issues 
relating  to  the  consumption  of  natural  resources  that  link  directly  to  increased 
greenhouse  gas  emissions  and  environmental  degradation.  As  part  of  the  external 
fisheries  policy,  the  Commission  pursued  its  actions  for  the  promotion  of  the 
sustainable use of marine resources outside EC waters. The Commission pursued the 
strengthening  of  fisheries  management  in  ACP  countries  and  the  promotion  of 
regional cooperation through a €30 million pr ogramme under the 9th EDF. In total, 
the EC financial support56 to the fishery sector in developing countries amounted to 
about €190 million in 2007. 

Several geographic programmes incorporate actions for capacity building in the field 
of  environment  but  in  addition,  specific  projects  have  been  set  up  such  as  a  €19.5 
million  capacity  building  programme  for  African,  Caribbean  and  Pacific  countries 
(9th EDF) in order to assist ACP countries with their obligations under multilateral 
environment agreements. 

2.3.11.  Food security 

The  world  food  situation  is  currently  characterised  by  new  driving  forces,  namely 
income  growth,  climate  change,  high  energy  prices,  globalization  and  urbanisation, 
which  are  transforming  food  availability,  access,  diversity  and  markets.  The 
influence  of  the  private  sector  in  the  world  food  system  is  also  rapidly  increasing. 
Changes  in  food  availability,  rising  commodity  prices  and  new  producer-consumer 
linkages have crucial implications for the livelihoods of the poor and food-insecure 
people57.  This  year's  cereal  harvests  in  all  regions  of  the  world  show  a  marginal 

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Including EDF and the financial compensation under the Fishery Partnership Agreements 
Food  Policy  Report  N°  18  The  World  Food  Situation,  New  Driving  Forces  and  Required  Actions, 
Joachim von Braun, IFPRI, December 2007. 

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growth of less than 1% from 2006, which follows increases of 5.1 and 3.1 % in the 
previous  years.  Increased  production  is  mainly  concentrated  in  Asia  (China  and 
India) and in Southern Africa but reflects also an improvement, in comparison with 
2005, in Eastern, Western and Central Africa58. At half way between the adoption of 
the  MDGs  and  the  2015  target  date,  sub-Saharan  Africa  is  not  on  track  to  achieve 
any  of  these  goals.  Persistent  food  insecurity  is  compounded  by  conflicts,  poor 
governance, adverse climatic conditions and the HIV/AIDS pandemic. These factors 
build on a chronic situation of poverty, which is still overwhelmingly rural, despite 
the growing phenomenon of urban food insecurity, particularly in Latin America and 
Asia. 

In  its  Communication  A  thematic  strategy  for  food  security  –  advancing  the  food 
security agenda to achieve the MDG59, the Commission has recognised the need for 
a  new,  comprehensive  EC  approach  to  state  fragility  and  innovative  food  security 
responses to access, availability, nutritional diversity and quality at all levels. From 
this year onward, country programmes aimed to eradicate chronic poverty are mainly 
supported  through  the  geographical  instruments.  The  humanitarian  instrument 
addresses food crises and delivers food assistance through DG ECHO, and the new 
food security thematic programme (FSTP) ensures overall coherence in the approach 
to  food  security,  mainly  at  global,  continental  and  regional  levels.  However,  the 
FSTP also intervenes at national level in order to ensure the continuity of assistance 
in the transition from relief to development in failed and fragile states (LRRD). 

The  FTSP's  objective  is  to  improve  food  security  in  favour  of  the  poorest  and  the 
most vulnerable and contribute to achieving the first MDG, through a set of actions 
which  ensure  overall  coherence,  complementarities  and  continuity  of  Community 
interventions. This year's annual action programme amounted to €201.5 million and 
addressed  several  strategic  priorities.  €45  million  was  allocated  for  contributing  to 
food  security  through  research  and  technology.  The  CGIAR  and  its  fifteen 
International  Research  Centres  will  be  supported  in  its  important  role  in  the 
development of applicable knowledge in the fields of food security, natural resources 
management  and  conservation  of  genetic  resources.  Exploiting  the  potential  of 
continental  and  regional  approaches  to  improve  African  countries'  trade  by 
strengthening  surveillance  and  control  of  food  safety  and  quality  systems  received 
€10 million. 

€80.3 million were foreseen for addressing food 
insecurity in exceptional situations 
of  transition,  and  in  fragile  and  failed  states  where  bilateral  cooperation  with 
governments is not feasible through ordinary geographical instruments. In 2007, the 
EC strengthened the concept of LRRD and improved the coordination between relief 
and  rehabilitation  actions  by  taking  into  account  long-term  development  needs, 
including  prevention  and  preparation  to  crises.  An  LRRD  analysis  framework  and 
main lines of actions for post-conflict and post-disaster situations were developed. A 
special  allocation  was  provided  to  chronically  food-insecure  Asian  and  Caucasian 
countries  (Bangladesh,  Kyrgyzstan,  Tajikistan,  Georgia,  Armenia,  Yemen)  for 
allowing  a  transition  to  longer-term  assistance  to  be  provided  in  the  future  by 
geographical  instruments  (DCI  and  ENPI)  in  the  area  of  social  protection  –  €65.2 

58 

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Perspectives  de  l'alimentation,  Analyses  des  Marchés  Mondiaux,  November  2007.  The  State  of  Food 
Insecurity (SOFI) 2006, The State of Food and Agriculture (SOFA) 2007FAO 
COM(2006)21 final 

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million. Finally, €0.7 million were dedicated to fostering advocacy and advancement 
of the food security agenda, harmonisation and alignment with development partners 
and donors. 

At  the  Commission's  invitation,  the  Permanent  Interstate  Committee  for  Drought 
Control in the Sahel (CILSS) and the Sahel and West Africa Club (SWAC/OECD) 
organized  in  Brussels  the  23rd  annual  meeting  of  the  Food  Crisis  Prevention 
Network  in  the  Sahel  and  West  Africa.  Strengthening  networking  to  facilitate  the 
exchange of information is a permanent concern of the Commission and one of the 
most effective ways to prevent food crises. 

Table 19 DCI - Thema-Sector   Breakdown by sector of external aid financed on the General 
Commission Budget managed by EuropeAid in 2007

Commitments ( € million)

64 M€, 8%

271 M€, 33%

322 M€, 38%

Social Infrastructures: Education, Health,
W ater, Government & Civil Society,
Other 

Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services

Production : Agriculture, Forestry &
Fishing, Industry, Mining & C onstruction,
Trade & Tourism

Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food
Security

53 M€, 6%

90 M€, 11%

32 M€, 4%

Others - Including Emergency
assistance, reconstruction relief

Payments ( € million)

123 M€, 16%

221 M€, 30%

254 M€, 34%

Social Infrastructures: Education, Health,
Water, Government & Civil Society,
Other 
Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services
Production : Agriculture, Forestry &
Fishing, Industry, Mining & Construction,
Trade & Tourism
Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food Security

29 M€, 4%

66 M€, 9%

Others - Including Emergency
assistance, reconstruction relief

53 M€ , 7%

Bilateral and Multilateral ODA/OA (EuropeAid only)

EN 

97 

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Table 20 DCI - Thema-Total   External aid financed on the 
General Commission Budget managed by EuropeAid 2007

€ millions

2007

Commitments

            833    

Payments

            745    

Bilateral and Multilateral ODA/OA (EuropeAid only)

2.4. 

Democracy and Human Rights 

The  EU  is  firmly  committed  to  continue  developing  a  deeply  rooted  culture  of 
democracy  and  human  rights  worldwide,  in  order  to  ensure  that  civil,  political, 
economic, social and cultural rights are treated equally without any discrimination in 
their  applicability.  Democracy  and  human  rights  are  perceived  as  universal  values, 
inextricably  linked  and  to  be  pursued  in  their  own  right.  They  are  also  seen  as 
integral  to  effective  work  on  poverty  alleviation  and  achieving  the  MDGs,  as  vital 
tools for conflict prevention and resolution, and as the indispensable framework for 
combating terrorism. Democratic processes of accountability are also key factors to 
ensuring  government  transparency  and  combating  corruption.  Ensuring  human 
rights,  rule  of  law  and  inclusive  democracy  are  important  to  avoid  alienating 
communities and to create the necessary conditions for human security. 

There  is  general  acceptance  of  the  need  for  long  term  interventions  and  local 
ownership  of  the  development  and  democratisation  process,  engaging  governments 
and  all  leading  local  stakeholders,  including  national  parliaments.  Human  rights 
affect  every  area  of  work  and  life.  For  this  reason,  the  Commission  pursues  a 
mainstreaming approach to its promotion. Particular attention is given to the rights of 
specific  groups  such  as  children,  indigenous  peoples  and  people  with  disabilities. 
Time  and  resources  are  invested  into  ensuring  that  the  means  and  ways  used  in 
achieving development objectives promote and at the minimum do not conflict with 
universal  human  rights  principles.  A  study  on  lessons  learnt,  consultation 
mechanisms  and  procedures  as  well  as  best  practices  from  projects  which  affected 
indigenous  peoples  and  communities  in  the  ACP  countries,  particularly  Suriname 
and Kenya, was commissioned in 2007. The study is due to be finalised in February 
2008  and  its  recommendations  should  identify  priority  areas  where  indigenous 
peoples' rights and issues should be better integrated as well as specific projects for 
support to indigenous peoples' rights and issues that can be accommodated under the 
programming for the 10th EDF. 

Activities  to  implement  EU  policies  for  democracy  and  human  rights  worldwide 
include  political  dialogue,  diplomatic  initiatives  and  assistance  financed  from 
instruments  for  financial  and  technical  cooperation,  including  DCI,  ENPI,  IPA,  the 
Instrument  for  Stability,  the  EDF  and  the  European  Instrument  for  Democracy  and 
Human  Rights  (EIDHR).  EIDHR  complements  and  reinforces  action  on  human 
rights  and  democracy  under  other  instruments.  Work  with,  for  and  through  civil 
society  organisations  gives  EIDHR  its  critical  profile.  It  promotes  the  kind  of 

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openness which civil society needs in order to thrive and supports it in becoming an 
effective  force  for  dialogue  and  reform.  It  tackles  human  rights  issues  at  the  front 
line,  with  particular  reference  to  human  rights  defenders,  highlights  the  ubiquitous 
problem  of  torture  and  ill-treatment  and  supports  democratic  reform  and  human 
rights at local level. 

For  2007-2010,  EIDHR  aims  to  enhance  respect for human rights and  fundamental 
freedoms in countries and regions where they are most at risk; strengthening the role 
of civil society in promoting human rights and democratic reform, in supporting the 
peaceful  conciliation  of  group  interests,  and  in  consolidating  political  participation 
and representation; supporting actions in areas covered by EU Guidelines, including 
on  human  rights  dialogues,  human  rights  defenders,  the  death  penalty,  torture,  and 
children  and  armed  conflict;  supporting  and  strengthening  the  international  and 
regional  framework  for  the  protection  of  human  rights,  justice,  the  rule  of  law  and 
the promotion of democracy; and building confidence in and enhancing the reliability 
and transparency of democratic electoral processes, in particular through EU Election 
Observation  Missions.  This  year  six  global  calls  for  proposals,  for  some  €53.5 
million  were  issued.  These  made  available  €11.5  million  for  projects  to  enhance 
respect for human rights and fundamental freedoms in  countries  and  regions where 
they  are  most  at  risk;  €31.5  million  to   support  actions  on  human  rights  and 
democracy  issues  in  areas  covered  by  the  EU  guidelines  on  torture,  human  rights 
dialogues and human  rights  defenders; and €10.5 million to  support and strengthen 
the international and regional framework for the protection of human rights, justice, 
the  rule  of  law  and  the  promotion  of  democracy,  in  particular  International  Justice 
and Regional Master's Degrees outside the European Union. 

In  addition,  country-based  support  schemes  covered  47  countries,  where  local  calls 
for proposals and support measures will be implemented for an indicative amount of 
€31.8 million.  Strategic partnerships to support and strengthen the international and 
regional  framework  for  the  protection  of  human  rights,  justice,  the  rule  of  law  and 
the promotion of democracy included the UN Office of the High Commissioner for 
Human Rights, the International Criminal Court, the Special Court for Sierra Leone, 
the Council of Europe, the OSCE/ODIHR, the Masters Degree in Human Rights and 
Democratisation,  the  EU-UN  Fellowship  Programme,  and  other  education,  training 
and research activities. 

Lessons learned 

EIDHR  continued  to  be  subject  to  much  scrutiny  and  evaluation.  Improvements 
regarding programming and implementation were made. There has been a shift from 
project  evaluations  to  thematic,  programme  and  methodological  ones  covering  a 
wider range of projects and providing a better overview of its impact. An evaluation 
of support to torture rehabilitation centres was launched in 2007 and its results will 
be  available  in  2008.  Recent  evaluation  reports  are  available  on  death  penalty 
abolition projects, covering all EIDHR assistance in this field since 1998, and on the 
Council of Europe's network of schools for political studies, which the Commission 
co-finances through EIDHR60. 

60 

http://ec.europa.eu/europeaid/where/worldwide/eidhr/working-documents_en.htm 

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Several  recommendations  appear  in  most  EIDHR  evaluations,  including  those  to 
increase dialogue with implementing partners during projects, to increase sharing of 
information and lessons learned between Delegations and Commission headquarters 
on  the  implementation  of  the  programme,  more  systematic  monitoring,  combining 
project visits by EC task managers with visits of external consultants (ROM), and to 
increase  and  improve  use  of  logical  framework  approaches  and  project  cycle 
management.  This  year's  annual  action  programme  reflected  these  issues,  in 
particular  as  regards  support  measures  and  coordination.  Commission  Delegations 
can  spend  up  to  3%  of  the  respective  annual  operational  country  allocation  on 
support  measures  accompanying  the  implementation  of  country-based  support 
schemes (activities in the field of communication, capacity-building actions for civil 
society local partners, meetings with local organisations, etc). 

Electoral assistance and observation 

Support to  the electoral  process is  particularly important in the strategy to promote 
democracy  and  is  mainly  implemented  in  two  ways.  With  legal,  technical  and 
logistic support, electoral assistance aims to strengthen national capacities to conduct 
peaceful  and  well-organised  elections  in  an  open,  competitive  and  transparent 
process.  Through  the  deployment  of  EU  Election  Observation  Missions,  electoral 
observation  aims  to  legitimise  and  enhance  public  confidence  in  the  electoral 
process,  to  deter  fraud,  to  strengthen  respect  for  human  rights,  and  to  contribute  to 
the  resolution  of  conflicts.  This  year  the  Commission  identified,  formulated  and 
launched  the  implementation  of  electoral  assistance  projects  in  Togo  (€13.6  M), 
Bangladesh (€15M), Guinea Conakry (€8.7 M)
Comoros  (€0.4  M).  Donor  coor dination  is  particularly  relevant  for  electoral 
assistance  and  the  commitments  of  the  Paris  Declaration  are  taking  root  at  country 
level.  In  most  cases,  EC  contributions  are  channelled  through  common  "basket 
funds" managed by UNDP that combine most of the donor assistance to the electoral 
process. 

, Chad (€5 M), Timor Leste (€1.5 M), 

Developing  methodological  tools  and  coordination  and  collaboration  with  the  main 
actors  in  the  field  continued  to  be  a  priority.  The  EC  Methodological  Guide  on 
Electoral  Assistance  finalised  in  2006  has  been  widely  disseminated.  A  training 
manual for the EC/UNDP Joint Training on Effective Electoral was also developed 
for the 2007 edition of this training seminar.61 This seminar brought together for five 
days more than 100 participants from EC and UNDP staff but also representatives of 
electoral  management  bodies  and  government  institutions,  staff  from  bilateral 
development agencies, international organizations and selected international electoral 
experts. This year, the Commission joined the Steering Committee of ACE, the most 
important  electoral  knowledge  network  and  largest  repository  of  information,  tools 
and methodologies on electoral assistance.62 The Commission shares the goal of the 
ACE network, to promote more professional, effective and sustainable administration 
of  elections  worldwide.  It  supports  the  network  financially  and  in  substance,  with 
comparative data, studies and reports derived from EC-funded projects and from the 
tools and methodologies developed by the Commission. 

Election observation 

61 
62 

www.ec-undp-electoralassistance.org 
www.aceproject.org 

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In  2007  the  EU  successfully  implemented  election  observation  missions  in  ten 
countries:  Aceh,  Mauritania,  Nigeria,  Timor  Leste,  Sierra  Leone,  Guatemala, 
Ecuador, Togo, Kenya and Pakistan with a total of some 800 observers deployed on 
the  ground.  These  missions  played  a  key  role  in  providing  an  appreciated 
professional assessment of the electoral process, in particular in countries where the 
election was controversial (e.g. Nigeria, Kenya). However, the year was also marked 
by a few missions that were postponed (Bangladesh early in the year, Nepal's June 
and November's postponements) or cancelled (Thailand). 

The  EU  Electoral  Observation  Mission's  methodology  is  mainly  based  on  the 
principles  of  independence,  impartiality,  transparency,  and  long-term  observation. 
EU election observation involves the assessment of the strengths and weaknesses of 
an  electoral  process  and  the  presentation  of  recommendations  that  will  provide  an 
important  basis  for  determining  further  assistance  after  the  elections.  This 
methodology has improved in the past years and it has been praised by the media and 
partner bodies for its accuracy. The second edition of the EU EOMs handbook was 
updated and finalised. 

EN 

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Table 21 EIDHR-Sector   Breakdown by sector of external aid financed on the General Commission 
Budget managed by EuropeAid in 2007

Commitments ( € million)

9 M€, 6%

133 M€, 94%

Payments ( € million)

8 M€, 6%

4 M€, 3%

Bilateral and Multilateral ODA/OA (EuropeAid only)

118 M€, 91%

Social Infrastructures: Education, Health,
W ater, Government & Civil Society,
Other 

Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services

Production : Agriculture, Forestry &
Fishing, Industry, Mining & C onstruction,
Trade & Tourism

Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food
Security

Others - Including Emergency
assistance, reconstruction relief

Social Infrastructures: Education, Health,
Water, Government & Civil Society,
Other 
Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services
Production : Agriculture, Forestry &
Fishing, Industry, Mining & Construction,
Trade & Tourism
Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food Security

Others - Including Emergency
assistance, reconstruction relief

EN 

102 

   EN 

 
Table 22 EIDHR-Geo   Breakdown by region of external aid financed on the General Commission 
Budget managed by EuropeAid in 2007

Commitments ( € million)
4 M€, 3%

6 M€, 4%

6 M€, 4%

10 M€, 7%

ENPI East

ENPI South

117 M€, 82%

Payments ( € million)

32 M€, 25%

Asia

Latin America

ACP

Regional

12 M€, 9%

11 M€, 8%

ENPI East

ENPI South

22 M€, 17%

Asia

Latin America

38 M€, 29%

15 M€, 12%

ACP

Regional

Bilateral and Multilateral ODA/OA (EuropeAid only)

Table 23 EIDHR-Total   External aid financed on the 
General Commission Budget managed by EuropeAid 
2007

€ millions

2007

Commitments

        142    

Payments

        130    

Bilateral and Multilateral ODA/OA (EuropeAid only)

EN 

103 

   EN 

 
 
2.5. 

Stability 

2.5.1.  Crisis response and preparedness 

For  several  years  EC  external  instruments  have  been  providing  the  Commission’s 
contribution  to  the  Union’s  overall  crisis  responses,  be  it  in  response  to  natural 
disasters or to political crises in third countries, in the latter case often alongside EU 
Joint  Actions  under  Common  Foreign  and  Security  Policy  (CFSP)  or  European 
Security and Defence Policy (ESDP). Between 2000 and 2006, this role was played 
by  the  Rapid  Reaction  Mechanism  (RRM)  for  non-humanitarian  crisis  responses. 
Despite modest financial envelopes (in the order of €30 million pe r year) and a tight 
limit on the duration of programmes (maximum six months), RRM-funded projects 
have played a  significant role in several crisis response undertakings by the EU, in 
many  cases  kick-starting  programmes  under  the  geographic  instruments  or 
dovetailing  CFSP/ESDP.  The  RRM  was  successfully  used  following  the  crisis  in 
Afghanistan, in response to the tsunami and for the Aceh Peace Process, for the EU 
Border  Assistance  Mission  to  Moldova  and  Ukraine,  and  in  response  to  a  series  of 
other crises in Africa, Latin America, the Western Balkans and the Middle East. 

The launch of the Instrument for Stability (IfS) this year considerably enhanced the 
Commission’s  crisis  response  capacity  (in  addition  to  introducing  an  allocation  for 
crisis  preparedness  (see  below),  and  creating  the  possibility  to  address  longer-term 
trans-regional  security  threats  over  the  longer  term  (see  2.5.2).  Compared  to  the 
RRM, the crisis response component of the IfS represents a considerable increase in 
financial allocations (€93 million in 2007,  and an average of €200 million per year 
during  the  period  2007-2013)  and  in  the  duration  of  programmes  (18  months,  with 
the possibility of extension, and/or of succedent interim response measures). 

IfS crisis response measures can address a wide range of issues, including support to 
mediation,  confidence  building,  interim  administrations,  strengthening  the  rule  of 
law,  transitional  justice,  disarmament/demobilisation/re-integration  of  combatants 
(DDR),  equitable  access  to  natural  resources,  disaster  response  and  rehabilitation. 
Such  activities  can  be  supported  in  situations  of  crisis  or  emerging  crisis,  when 
support  cannot  be  provided  rapidly  enough  under  other  financial  instruments. 
Typically,  the  IfS  can  be  mobilised  in  the  case  of  a  major  new  political  crisis  or 
natural disaster, a window of opportunity to pre-empt a crisis or advance on conflict 
resolution, the urgent need to secure the conditions for the delivery of EC assistance, 
or alongside CFSP / ESDP actions. Approval procedures are designed to ensure rapid 
adoption of programmes. 

In  its  first  year  of  operation  the  IfS  already  financed  a  significant  number  of  crisis 
response projects with a total budget of €91 million 63. Geographically, the measures 
adopted  are  widely  distributed.  The  largest  share  of  funds  has  been  allocated  for 
measures  in  Africa  (DRC,  Uganda,  Guinea-Bissau,  Chad,  Darfur,  Zimbabwe, 
Somalia), followed by the Middle East (Lebanon, Palestine, Iraqi Refugees in Syria), 
the  Balkans  (Kosovo),  Latin  America  and  the  Caribbean  (Colombia,  Bolivia,  Peru, 
Haiti),  and  Asia-Pacific  (Afghanistan,  Thailand,  Sri  Lanka,  Burma/Myanmar, 

63 

For  full  details,  see  Annual  Report  from  the  European  Commission  on  the  Instrument  for  Stability  in 
2007, COM (2008) 181. 

http://europa.eu.int/eur-lex/lex/LexUriServ/LexUriServ.do?uri=CELEX:52008DC0181:EN:NOT 

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Philippines,  Fiji).  Two  thematic  facilities  were  devised,  with  a  view  to  providing 
support for policy advice and mediation, on the one hand, and, in the context of the 
Commission's Chairmanship of the Kimberley process in 2007, to address the issue 
of  conflict  resources,  on  the  other.  The  identified  measures  cover  a  broad  range  of 
issues,  targeted  on  the  specific  needs  of  each  conflict/post-conflict  situation:  short-
term  advice  to  develop  and  catalyze  post-conflict  security  system  reform, 
complementary  measures  in  areas  where  ESDP  missions  are  deployed  (e.g.  DRC, 
Afghanistan,  Chad),  support  to  regional  peace-building  capacity  (AU  –  AMISOM 
Somalia,  AU-UN  Mediation  in  Darfur),  rule  of  law  and  transitional  justice 
(Afghanistan, Kyrgyzstan, Colombia, Haiti), support to interim administrations (ICO 
Kosovo),  conflict  resolution  and  reconciliation,  post-conflict  or  -disaster  needs 
assessments (Lebanon, Peru), support to displaced populations (Lebanon, Syria), and 
conflict resources (dedicated facility). 

In addition to this sizeable and growing crisis response component, the IfS innovated 
by introducing a ‘crisis preparedness’ component of €7 million. The Peace-building 
Partnership  aims  to  mobilise  and  consolidate  civilian  expertise  for  peace-building 
activities.  It  mainly  focuses  on  strengthening  the  up-stream  capacity  of  partners  to 
rapidly respond to a crisis scenario, and mainly addresses civil society organizations 
and  think-tanks,  but  also  international  organizations  and  agencies  in  EU  Member 
States. The first annual action programme financed capacity-building, early warning 
activities and exchange of experience on best practice for civil society organizations; 
early warning and early recovery work with UNDP and the AU; and training for civil 
stabilization missions. The Peace-building Partnership will build upon existing work 
with civil society organizations which is currently being undertaken in the context of 
a preparatory action for the establishment of a conflict prevention network. Finally, a 
web-portal has been launched under the Partnership, which will allow organizations 
to provide information regarding their areas of activity related to conflict prevention, 
crisis  management  and  peace-building  to  the  Commission.  This  information  will 
initially  serve  as  a  directory  in  order  to  facilitate  the  enhancement  of  a  policy 
dialogue. 

Work  is  also  underway  to  further  improve  the  Commission’s  crisis  response 
capacities.  In  line  with  earlier  recommendations  of  Michel  Barnier’s  report64,  the 
network  of  Commission  Delegations  in  third  countries  is  being  strengthened 
specifically as regards the coordination and facilitation of crisis responses, with the 
objective  of  progressively  building  several  regional  poles  of  multi-sector  expertise. 
Work  is  also  continuing  on  the  further  reinforcement  of  disaster  response 
coordination  between  humanitarian  responses,  civil  protection,  and  other  crisis 
responses,  both  at  headquarters  level  and  in  the  field.  The  EC  civil  protection 
mechanism,  deployable  within  and  outside  the  EU  through  the  mechanism’s 
Monitoring and Information Centre (MIC), was further strengthened during the year 
to allow the Commission to facilitate and in some cases co-finance (up to 50%) the 
transport of civil protection assistance to a disaster affected country. 

64 

Michel  Barnier,  For  a  European  Civil  Protection  Force:  Europe  Aid,  May  2006. 
http://ec.europa.eu/commission_barroso/president/pdf/rapport_barnier_en.pdf 

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2.5.2.  Global and regional trans-border challenges 

One of the components of the IfS aims to develop longer-term EC actions to counter 
global  and 
trafficking, 
proliferation  of  nuclear,  biological  and  chemical  agents  and  also  threats  to  critical 
infrastructure and public health. 

threats  arising  from  organised  crime, 

trans-regional 

In  September;  a  strategy  paper  (with  an  indicative  programme  2007/2008)  was 
adopted.  Its  main  priorities  for  longer-term  actions  are  to  block  the  proliferation  of 
weapons of mass destruction, global and trans-regional efforts to address the threats 
posed by trafficking, terrorism and organised crime, and building capacity within the 
EU  and  the  international  community  for  effective  crisis  response.  An  appropriate 
regional  balance  and  coherence  and  complementarity  of  all  IfS  actions  with  those 
supported  through  other  EC  instruments,  including  the  EDF,  will  be  ensured.  The 
first indicative programme includes a range of actions relating to the trans-regional 
threats.  It  also  foresees  the  devising  of  a  mechanism  (expert  support  facility)  to 
mobilise expertise in the domains covered by the IFS in order to ensure the proper 
preparation  of  the  actions.  The  other  components  of  the  IfS  address  crisis  response 
and preparedness (see section 2.5.1). 

On  23  October  the  European  Court  of  Justice  annulled  the  Commission  financing 
decision of 21 December 2004 approving a project relating to border security in the 
Republic of the Philippines on the ground of excess of competence. The Court ruled 
that  this  Decision  pursued  an  objective  concerning  the  fight  against  terrorism  and 
international  crime  falling  outside  the  framework  of  the  development  cooperation 
policy  pursued  by  the  ALA  Regulation  (constituting  its  legal  basis).  In  order  to 
comply  with  this  judgment,  on  20  December  the  Commission  adopted  a  Decision 
regularising and enabling the continuation of the project, which qualifies as a Special 
Measure under Article 9 of the IfS regulation. Article 4(1)(a) of the latter gives the 
Commission  the  competence  to  provide  technical  and  financial  assistance  to  third 
countries in the field of counter-terrorism. 

Mine action 

The overall goal of EC mine action has always been to contribute to the elimination 
of mines (including Explosive Remnants of War) and to solve the related economic 
and social problems caused by these weapons. That is why “mine action” has always 
been  part  of  EC  assistance  and  development  programmes  in  third  countries.  This 
year, Commission support in this area continued to be carried out in line with the EC 
Mine Action Strategy and related Multi-annual Programming 2005-07. Mine action 
policy was pursued through various instruments for a total of €33 million committed 
to  support  action  in  Belarus,  Bosnia-Herzegovina,  Cambodia,  Cyprus,  Ethiopia, 
Guinea-Bissau,  Jordan,  Lebanon,  Senegal  and  Sudan.  Activities  supported  included 
mine clearance, mine risk education, APL stockpile destruction and assistance in the 
safe  return,  resettlement  and  establishment  of  livelihoods  of  internally  displaced 
persons and refugees. 

EU Small Arms and Light Weapons (SALW)  

The  Commission  continued  supporting  the  implementation  of  the  EU  Small  Arms 
and  Light  Weapons  (SALW)  Strategy.  The  Commission  has  been  pursuing  the 

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integration of issues related to small arms into country and regional strategy papers. 
This  offers  partner  countries  the  opportunity  to  give  the  appropriate  political  and 
funding  priority  in  engaging  these  issues  in  the  context  of  EC  external  assistance 
programmes. The main project was assistance to overcome the consequences of the 
Novobohdanivka  ammunition  depot  explosions in  Ukraine.  SALW-related  projects, 
both  at  regional  and  national  level,  were  accompanied  by  seminars  and  initiatives 
aimed  to  increase  the  Commission’s  participation  in  policy  debates,  ensuring  more 
coherence  between  CSFP  and  EC-funded  initiatives  and  to  strengthen  cooperation 
with  other  non  EU-partners.  In  this  context,  a  seminar  was  organised  by  the 
Commission together with the AUC. Additionally, a preparatory action on SALW for 
the Western Balkans SALW was smoothly implemented and concluded. 

Non proliferation of weapons of mass destruction 

A Commission pilot project programme on export control of dual use materials was 
implemented  by  BAFA  (Germany’s  export  control  agency)  with  the  assistance  of 
national  experts  from  Member  States  in  Albania,  Bosnia  and  Herzegovina,  China, 
Croatia, the former Yugoslav Republic of Macedonia, Montenegro, Morocco, Serbia, 
Ukraine  and  the  United  Arab  Emirates.  A  pilot  programme  in  Russia  was  also 
conducted.  The  bulk  of  the  activities  of  the  centres  in  Moscow  and  Kiev  on 
redirecting scientists' work continued to be devoted to managing research projects. A 
programmatic approach has been elaborated to focus funding parties’ investment in 
areas  that  meet  the  highest  priority  non-proliferation  objectives,  e.g.  counter 
terrorism, global security, nuclear safety, bio-safety and bio-security. 

Avian Influenza crisis 

Because  of  the  highly  pathogenic  nature  of  the  H5N1  virus,  responsible  for  human 
casualties and huge economic losses, the EU has continued its strong response. The 
Commission  has  been  a  driving  force  at  the  front  of  a  consensual  international 
answer. In 2007, the EU contributed with an additional commitment of €94 million 
to the fight against the consequences of the disease and to a sound preparedness for a 
possible pandemic, raising the total EU contribution since the Beijing conference of 
January  2006  to  €413  million.  The  Commission  was  a  co-organizer  of  the 
International  Ministerial  Conference  of  New  Delhi  in  December.  It  remains  by  far 
the major contributor to the Avian and Human Influenza facility, a fund administered 
by the World Bank that aims to fund national action plans against AI in Asia, Eastern 
Europe and Mediterranean countries. 

International cooperation against drugs 

EC  (and  EU)  cooperation  with  third  countries  against  drugs  is  a  component  of  a 
broader policy. This includes political and policy dialogue (most often in the form of 
"Drug  Troikas"),  active  participation  in  multilateral  discussions  and  arrangements 
(Commission  on  Narcotic  Drugs,  Dublin  Group  and  Paris  Pact),  and  trade 
preferences  linked  to  good  governance,  inter  alia,  in  the  area  of  drugs.  This 
cooperation remains a very important area of development assistance. The total stock 
of  EU  projects  stands  at  nearly  € 760  million,  45  %  of  which  are  funded  by  the 
Commission and the rest by Member States. 

EN 

107 

   EN 

Afghanistan has continued to replace the Andean region as the main recipient of EC 
development  assistance  in  the  area  of  drugs.  Most  efforts  remain  focused  on  rural 
reconstruction and alternative development in opium-growing regions, together with 
initiatives  to  strengthen  the  justice  and  police  systems,  as  well  as  border 
management.  These  efforts  are  complemented  by  support  to  regional  cooperation 
between Afghanistan and its neighbours against the diversion of chemical precursors. 
About  half  of  the  bilateral  efforts  geared  to  the  Andean  countries  are  devoted  to 
Colombia, with the rest divided somewhat evenly between Bolivia and Peru. All of 
them remain in the area of alternative development. They have been complemented 
by two Andean-wide regional initiatives, one against synthetic drugs (launched this 
year); and the other against the diversion of precursors. Efforts increasingly focused 
on demand reduction, even if supply control components remain important, continue 
under  three  regional  programmes  in  the  former  Soviet  Union:  BUMAD  (Belarus, 
Ukraine,  Moldova  Anti-Drugs),  SCAD  (Southern  Caucasus  Anti-Drugs)  and 
CADAP  (Central  Asia  Drug  Action  Programme).  Some  components  of  the  Border 
Management  for  Central  Asia  programme  and  the  European  Union  Border 
Assistance in Moldova and Ukraine also seek to reduce drug trafficking. 

All  of  these  bilateral  and  regional  efforts  continue  to  be  complemented  by  several 
inter-regional projects: demand and harm-reduction projects in the Muslim world in 
Asia and Latin America and the Caribbean, supply reduction initiatives (on the new 
challenge of drug trafficking from Latin America and the Caribbean to West Africa) 
and projects to influence the policy direction of the Paris Pact Process. Of significant 
interest  as  regards  policy  formulation  are  the  support  of  a  NGO  global  forum  on 
drugs and the financing of an expert group for a more evidence-based assessment of 
the global drugs policies since the Special Session of the UN General Assembly on 
Drugs in 1998. 

EN 

108 

   EN 

Table 24 IFS-Sector   Breakdown by sector of external aid financed on the General Commission Budget 
managed by EuropeAid in 2007

Commitments ( € million)

2.6 M€, 10%

9.0 M€, 34%

15.0 M€, 56%

Payments ( € million)

0.7 M€, 4%

Social Infrastructures: Education, Health,
W ater, Government & Civil Society,
Other 

Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services

Production : Agriculture, Forestry &
Fishing, Industry, Mining & C onstruction,
Trade & Tourism

Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food
Security

Others - Including Emergency
assistance, reconstruction relief

Social Infrastructures: Education, Health,
Water, Government & Civil Society,
Other 
Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services
Production : Agriculture, Forestry &
Fishing, Industry, Mining & Construction,
Trade & Tourism
Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food Security

17.5 M€, 96%

Others - Including Emergency
assistance, reconstruction relief

Bilateral and Multilateral ODA/OA (EuropeAid only)

EN 

109 

   EN 

 
Table 25 IFS-Geo   Breakdown by region of external aid financed on the General Commission Budget 
managed by EuropeAid in 2007

Commitments ( € million)

6.3 M€, 24%

5.2 M€, 20%

0.0 M€, 0%

Payments ( € million)

9.0 M€, 48%

ENPI East

ENPI South

Asia

Latin America

15.0 M€, 56%

ACP

Regional

2.5 M€, 14%

0.3 M€, 2%

ENPI East

ENPI South

3.2 M€, 18%

Asia

Latin America

0.9 M€, 5%

ACP

Regional

Bilateral and Multilateral ODA/OA (EuropeAid only)

2.4 M€, 13%

Table 26 IFS-Total   External aid financed on the General 
Commission Budget managed by EuropeAid 2007

€ millions

2007

Commitments

         26.57    

Payments

         18.20    

Bilateral and Multilateral ODA/OA (EuropeAid only)

EN 

110 

   EN 

 
 
2.6. 

Nuclear Safety 

The  EU  continued  its  support  for  enhanced  nuclear  safety  in  Russia  and  Ukraine 
under  the  TACIS  Nuclear  Safety  Programme.  The  main  challenges  include 
strengthening the regulatory authorities, promoting an effective nuclear safety culture 
at all levels and developing the management of spent fuel and radioactive waste. The 
Commission paid the second part of the third pledge (€49.1 million) of the New Safe 
Confinement  project  in  Chernobyl.  The  Armenian  Medzamor  power  plant,  which 
seems likely to continue operating for some years in view of the economic situation, 
remains a matter of concern. As the overall safety situation still has to be improved 
according  to  IAEA  standards,  the  EU  continued  to  provide  on-site  assistance  and 
support  to  the  Armenian  Regulatory  Authority.  Since  1  January  the  TACIS 
programme  has  been  replaced  by  the  Instrument  for  Nuclear  Safety  Cooperation 
(INSC). The Instrument for Stability is also relevant for nuclear safety, especially for 
combating  illicit  trafficking  of  nuclear  and  radioactive  materials  in  former  Soviet 
Union  countries,  assistance  in  export  control  of  dual-use  goods  and  improving 
chemical, biological, radiological and nuclear (CBRN) materials trafficking control. 

EN 

111 

   EN 

Table 27 NSI-Sector   Breakdown by sector of external aid financed on the General Commission Budget 
managed by EuropeAid in 2007

Commitments ( € million)

1.1 M€, 1%

77.0 M€, 99%

Payments ( € million)

0.7 M€, 1%

Social Infrastructures: Education, Health,
W ater, Government & Civil Society,
Other 

Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services

Production : Agriculture, Forestry &
Fishing, Industry, Mining & C onstruction,
Trade & Tourism

Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food
Security

Others - Including Emergency
assistance, reconstruction relief

Social Infrastructures: Education, Health,
Water, Government & Civil Society,
Other 
Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services
Production : Agriculture, Forestry &
Fishing, Industry, Mining & Construction,
Trade & Tourism
Multisector/Crosscutting : Environment,
Other

Budget Support, Food Aid, Food Security

55.6 M€, 99%

Others - Including Emergency
assistance, reconstruction relief

Bilateral and Multilateral ODA/OA (EuropeAid only)

EN 

112 

   EN 

 
Table 28 NSI-Geo   Breakdown by region of external aid financed on the General Commission Budget 
managed by EuropeAid in 2007

Commitments ( € million)
1.1 M€, 1%

77.0 M€, 99%

Payments ( € million)

0.7 M€, 1%

ENPI East

ENPI South

Asia

Latin America

ACP

Regional

ENPI East

ENPI South

Asia

Latin America

55.6 M€, 99%

ACP

Regional

Bilateral and Multilateral ODA/OA (EuropeAid only)

Table 29 NSI-Total   External aid financed on the General 
Commission Budget managed by EuropeAid 2007

€ millions

2007

Commitments

         78.01    

Payments

         56.27    

Bilateral and Multilateral ODA/OA (EuropeAid only)

EN 

113 

   EN 

 
 
2.7. 

Humanitarian Assistance65 

Through its Directorate-General for Humanitarian Aid (DG ECHO), the Commission 
provides humanitarian assistance to the victims of natural or man-made disasters in 
third countries, on the sole basis of humanitarian needs. This year, the Commission's 
needs-based  response  to  humanitarian  crises  in  over  60  countries  was  channelled 
through  85  funding  decisions,  totalling  €769  milli on.  In  contrast  to  previous  years, 
there  were  no  major  new  crises  in  the  field  of  humanitarian  aid,  whether  they  be 
natural  disasters  or  complex  emergencies.  Nevertheless,  natural  disasters, 
accentuated by climate changes, continue to increase both in frequency and severity, 
affecting more often and more severely already vulnerable populations. 

This  year,  natural  disasters  created  serious  damage:  earthquakes  in  Peru  and  in 
Solomon  Islands;  floods  in  Africa,  Bangladesh,  India,  Indonesia,  Nepal,  North 
Korea, Vietnam and in Latin America; cyclones in Nicaragua (Felix), Mozambique 
(Favio) and in Bangladesh (Sidr); Hurricane Dean in the Caribbean; tropical storm in 
Haiti  and  Dominican  Republic  (Noel)  and  droughts  in  Honduras,  Moldova, 
Paraguay,  Kenya,  Somalia  and  the  Sahel  region.  The  Commission  had  to  respond 
speedily to help thousands of suffering people, sometimes already affected by crises. 

In terms of "man-made" crises, no new complex crisis emerged, but the Commission 
had  to  manage  worsening  humanitarian  situations,  sometimes  protracted  complex 
emergencies already existing in previous years. Some examples are Sudan, where the 
situation  remains  very  worrying:  violence  and  extortion  towards  the  civilian 
population in conflict-affected Darfur continues and have again forced many to flee 
elsewhere  in  the  country  or  to  take  refuge  in  neighbouring  countries.  At  the  same 
time,  there  are  still  clear  humanitarian  needs  in  Southern  Sudan,  which  slowly 
recovers  from  over  two  decades  of  war.  Floods  affecting  the  north  of  Sudan, 
including Darfur and Southern Sudan, in July have further compounded the situation. 
In  the  Democratic  Republic  of  Congo,  the  fighting  and  tensions  in  the  East  of  the 
country restarted during the summer, particularly in the North and the Southern part 
of  Kivu,  causing  there  as  well  numerous  population  movements  and  new 
humanitarian  needs.  Somalia  was  also  faced  with  both  natural  disasters  (droughts) 
and violence, forcing many to leave their homes. 

The Commission pays particular attention to ‘forgotten’ crises, i.e. situations where 
major humanitarian needs receive little attention from donors (reflected in the level 
of official aid received) and low media coverage. This year, the following forgotten 
crises  were  identified:  (i)  Sahrawi  refugees  in  Algeria,  (ii)  Chechnya  and  the 
neighbouring  republics  affected,  (iii)  the  population  affected  by  unrest  in  Kashmir 
and Jammu, India, (iv) the persisting crises of the Bhutanese refugees as well as the 
Maoist  insurrection  in  Nepal,  (v)  the  population  affected  by  the  conflict  in 
Burma/Myanmar  both  within  the  country  itself  as  well  as  in  its  neighbouring 
countries and (vi) the population affected by the crisis in Colombia as well as in the 
neighbouring countries.  These  forgotten crises  received  nearly  13%  (€60.7  million) 
of  the  initial  operational  budget  to  respond  to  their  forgotten  needs.  Except  for 
Colombia, these crises were already identified as "forgotten crises" in 2006. 

65 

For more details on the Commission's interventions in the field of humanitarian assistance, please refer 
to  the  relevant  Annual  Report  (http://ec.europa.eu/echo/information/publications/annual_rep_en.htm) 
and Financial report (http://ec.europa.eu/echo/statistics/echo_en.htm) 

EN 

114 

   EN 

                                                 
In line with the Commission's communication66 which has established the principle 
of "one instrument per policy area" in order to improve the efficiency of Community 
action  as  well  as  the  Commission's  communication  on  the  financial  perspectives 
2007-2013, it was decided that the responsibility for the management of food aid be 
transferred from Directorate General EuropeAid to DG ECHO, with effect from 1st 
January.  DG  ECHO  manages  the  food  aid  budget  within  the  framework  of  its 
mandate to save and preserve life during emergencies and their immediate aftermath. 

Main interventions in 2007, by region 

In 2007, the Commission allocated a total of €422 million (i.e. 55% of its total final 
budget) to ACP countries, with the largest funding for Sudan with a total of €110.45 
million,  and  the  Democratic  Republic  of  Congo  (€50 million).  The  other  major 
interventions in Africa which required more than €20 million of funding were Chad 
(€30.5  million),  Zimbabwe  (€30.2  million), 
Sahel  (€25.5  million),  Uganda  (€24 
million) and Ethiopia (€20 million). In No rthern Caucasus, the Commission pursued 
its funding to the victims of the Chechnya conflict in approving a total amount of € 
20.8 million. 

In  the  Middle  East,  the  Commission  pursued  its  response  to  the  dramatic 
deterioration of the humanitarian situation, caused by the escalation of tension in the 
Palestinian Territories and the fighting in a Palestinian refugees' camp, by providing 
more than €88 million of humanitarian aid. Th is aid permitted to cover the needs of 
the most vulnerable populations of the West Bank and Gaza Strip and of Palestinian 
refugees in Lebanon, Jordan and Syria. Finally, this amount was also used to respond 
to the internal crisis of Iraq, including refugees in neighbouring countries. Finally, in 
Asian  countries,  €27  million  were  addressed  to  vulnerable  people  affected  by  the 
Afghan  crisis  and  natural  hazards  in  Afghanistan,  Iran  and  Pakistan,  €19  million 
were  allocated  to  help  vulnerable  populations  in  Myanmar  and  Burmese  refugees 
along  the  Thai-Myanmar  border,  €17  million  for  the  victims  of  the  conflict  in  Sri 
Lanka,  as  well  as  €19.5  million  to  South  As ian  countries  –  without  taking  into 
account DIPECHO67 funding – for the recovery of communities affected by floods. 
€31 million was allocated in humanitarian  assistance to Latin America, €12 million 
of which for the victims of the Colombia conflict and the rest in response to several 
natural disasters, such as the earthquake in Peru (€8 million) and hurricane Felix in 
Nicaragua (€6 million). 

Humanitarian policy 

On  a  policy  level,  an  important  milestone  was  reached  with  the  Commission's 
proposal  for  a  European  Consensus  on  Humanitarian  Aid68  which  was  adopted  by 
Member  States,  the  European  Parliament  and  the  Commission  in  December,  in 
recognition  of  the  increasingly  challenging  environment  for  humanitarian  response 
and to drive forward a more efficient and coordinated EU approach. 

66 
67 

68 

EN 

"Disaster 

COM(2004)101 
The 
http://ec.europa.eu/echo/field/dipecho/index_en.htm 
Based on the Communication Towards a European Consensus on Humanitarian Aid adopted in June. 
COM(2007)317 final 

Preparedness 

programme. 

ECHO" 

See: 

115 

   EN 

                                                 
Disaster preparedness 

In  several  regions  of  the  world  the  Commission  supports  disaster  preparedness 
interventions. The Commission continued to support programmes69 launched in 2006 
(South East Asia, Central Asia and Central America) and new funding was allocated 
to other regions for a total of €19.5 million. In the Caribbean, the 6 th Action Plan (€4 
million) was launched with priorities to reinforce DIPECHO in Haiti, to consolidate 
Disaster Preparedness in urban settings, to include more English-speaking Caribbean 
countries  plus  countries  new  to  DIPECHO,  such  as  Suriname  or  Guyana.  New 
DIPECHO Action Plans were also adopted for South Asia (€7.5 million), including 
for  the  first  time  Afghanistan,  Central  America  (€1.5  million)  and  South  America 
(€6.5 million), focusing on the Andean Commu nity and Venezuela. The Commission 
aims  to  integrate  and  mainstream  disaster  preparedness  in  its  relief  interventions, 
when and where appropriate, and continues to work with other relevant stakeholders 
for  integration  of  disaster  risk  reduction  (DRR)  in  sustainable  development 
interventions. 

Budget 

Application of the needs based principles lead to the following geographical division 
of the funds for humanitarian aid committed in 2007, compared to 2006: 

TABLE 30: HUMANITARIAN ASSISTANCE IN 2007 ('000 €)  

2006 

Unit/Region 

Hum. 
aid 

Food 
aid 

Dipecho 

EDF 

Total 

% 

Total 

% 

A/1: Africa, 
Caribbean, Pacific 

All Africa 

220 910 

169 650 

4 000 

28 200 

422 760 

55.0% 

322 060 

48.0% 

2 000 

2 000 

Horn of Africa 

106 000 

106 450 

5 500 

217 950 

161 050 

Great Lakes 

61 500 

24 000 

4 000 

89 500 

West Africa 

32 600 

14 000 

46 600 

Caribbean, Pacific 

5 810 

2 000 

4 000 

4 500 

16 310 

15 000 

23 200 

12 200 

50 400 

84 050 

56 150 

1 610 

19 200 

Southern Africa, Indian 
Ocean 

A/2: New Independent 
States, Middle East, 
Mediterranean 

NIS (Chechnya, 
Caucasus, Tajikistan …) 

Middle East, 
Mediterranean 

93 290 

31 607 

124 897 

16.2% 

177 900 

26.5% 

22 500 

3 307 

25 807 

33 000 

70 790 

28 300 

99 090 

144 900 

69 

Notably in the DIPECHO programme 

EN 

116 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
A/3: Asia & Latin 
America 

127 801 

14 065 

15 500 

157 366 

20.5% 

124 541 

18.6% 

Asia 

96 801 

13 000 

7 500 

Latin America 

31 000 

1 065 

8 000 

117 301 

40 065 

99 941 

24 600 

Thematic funding + 
grants 

24 000 

4 900 

28 900 

3.8% 

20 500 

3.1% 

Technical Assistance 
(experts & field offices) 

25 400 

Use of re-assigned 
revenue 

307 

Support Exp. (audits, 
evaluation, information, 
etc.) 

25 400 

3.3% 

19 000 

2.8% 

307 

817 

8 900 

1.2% 

6 189 

1.0% 

TOTAL 

491 708 

220 222 

19 500 

28 200 

768 530  100% 

671 006 

100% 

Table 31 Relative share of regions and support activities in funding70: 

Humanitarian Aid 2007

Technical 
assistance
3,3%

Thematic funding, 
grants
3,8%

Support 
Expenditure, use 
of reassigned 
revenue
1,2%

Asia, Latin 
America
20,5%

NIS, Middle East, 
Medit.
16,2%

ACP countries
55,0%

2007 

2006 

ACP 

55% 

48% 

NIS, Med. 

16% 

27% 

ALA 

Other 

21% 

18% 

8% 

7% 

Total 

100% 

100% 

2.8.  Macro-financial assistance 

After  consulting  the  Economic  and  Financial  Committee  and  securing  a  Council 
Decision,  the  Commission  implements  macro-financial  assistance  (MFA)  in 
association  with  support  programmes  of  the  IMF  and  the  World  Bank.  MFA 
incorporates  a  set  of  principles  which  underline  its  exceptional  character  (ad  hoc 
Decisions  from  the  Council),  its  complementarities  to  financing  from  international 
financial  institutions  and  its  macroeconomic  conditionality.  It  is  an  instrument 
designed  to  help  countries  experiencing  serious,  but  generally  short-term  macro-

70 

Humanitarian aid, food aid and disaster preparedness budget lines and European Development Funds as 
far as ACP countries are concerned 

EN 

117 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
economic  imbalances  (balance  of  payments  and  fiscal  difficulties).  In  close 
coordination  with  IMF  and  World  Bank  programmes,  MFA  has  promoted  policies 
that are tailored to specific country needs with the overall objective of stabilising the 
external and internal financial situation and establishing market-oriented economies. 
In 2007, MFA authorisations of new operations totalled €125 million. This included 
a grant to Moldova of up to €45 million,  of which a first tranche of €20 million was 
disbursed71.  Lebanon  received  exceptional  EC  financial  assistance  of  up  to  €80 
million (€50 million in the form of loans  and €30 million in the form of grants) 72. 

3. 

FEATURE ARTICLES 

The challenge of reconciling MDGs and the fight against climate change 

“2007 was a great year for the fight against climate change”, noted UN Framework 
Convention  on  Climate  Change  executive  secretary  Yvo  de  Boer.  Indeed,  in  2007, 
global  public  opinion  and  the  scientific  and  political  communities  united  and 
mobilised support to address the global challenge of climate change. 

The  latest  scientific  findings  of  Nobel  Prize  winner  Inter-governmental  Panel  on 
Climate Change (IPCC)73 demonstrate convincingly that climate change will produce 
negative  consequences  around  the  world.  Food  security,  productive  infrastructures, 
and many densely populated living areas are under direct threat in the medium term; 
as well as the very survival of several island states. Unless effective countermeasures 
are taken, climate change could reverse progress towards  the  MDGs. However,  the 
Stern  Review  (2006)  on  the  Economics  of  Climate  Change74  emphasised  that  the 
efforts  to  avert  global  climate  change  and  those  aiming  to  promote  growth  and 
development  are  not  mutually  exclusive.  It  is  argued  that  the  cost  of  inaction  far 
outweighs the volume of investments needed to mitigate climate change (i.e. damage 
to the global economy could range from 5-20% of global annual GDP), early action 
could reduce economic losses to just 1% of global annual GDP. 

The  UN  Framework  Convention  on  Climate  Change  (UNFCCC)  and  the  Kyoto 
Protocol  are  the  established  frameworks  for  multilateral  negotiations  on  climate 
change.  The  Bali  Conference  in  December  agreed  on  an  action  plan  for  detailed 
negotiations  with  a  view  to  reaching  agreement  by  December  2009  on  a  climate 
regime for the reduction of global greenhouse gas emissions to take effect in 2013. 
The negotiations on the core subject of emission reduction (“mitigation”) will, inter 
alia,  cover  policy  approaches  related  to  reducing  emissions  from  deforestation  and 
forest degradation. The Bali Action Plan also addresses enhanced action on climate 
adaptation  including  funding  –  as  well  as  reinforced  technology  development  and 

71 
72 
73 
74 

Council Decision 2007/259/EC of 16 April 2007 
Council Decision 2007/860/EC of 10 December 2007 
http://www.ipcc.ch/ipccreports/ar4-syr.htm 
http://www.hm-
treasury.gov.uk/independent_reviews/stern_review_economics_climate_change/sternreview_index.cfm 

EN 

118 

   EN 

                                                 
transfer. It is to be noted that the annual cost of adaptation in developing countries 
has been estimated by various institutions at between 16 to 86 billion USD75. 

The  G8  also  pays  particular  attention  to  the  international  climate  change  agenda. 
Already  in  2005,  the  Gleneagles  plan  of  action  focused  primarily  on  (energy) 
mitigation. The G8 Heiligendamm Summit of June 2007 emphasised the importance 
of  adaptation  and  the  reduction  of  CO²  emissions  –  which  are  exacerbated  by 
increased deforestation and land-clearing activities – as priority areas for cooperation 
with  developing  countries  in  the  area  of  climate  change.  This  work  will  be  taken 
further by the Japanese G8 Presidency in 2008. 

The cross-cutting nature of climate change: need for mainstreaming 

Given  that  climate  change  cuts  across  a  range  of  themes  addressed  by  our  external 
action,  several  EU  policy  processes  and  cooperation  activities  –  which  may  not  be 
explicitly  labelled  “climate  change”  –  address  climate  change  and  its  negative 
consequences  nonetheless.  This  is  true  in  particular  for  policies  related  to  the 
forestry,  energy  or  rural  development  sectors,  for  example.  Moreover,  several 
Country  Strategy  Papers,  establishing  the  multi-annual  framework  for  cooperation, 
foresee interventions related to climate change. The challenge is now to ensure that 
climate change is consistently taken into account in these instruments, with the aim 
of  mainstreaming  climate  change  in  all  development  activities76.  Work  in  this  area 
builds on the 2004-2008 EU Action Plan on Climate Change and Development that 
the  Commission  and  Member  States  are  implementing  together.  The  Action  Plan 
covers  all  developing  countries.  First  and  foremost  the  Action  Plan  promotes 
mainstreaming  certain  aspects  of  climate  change  into  development  cooperation. 
These  include  four  strategic  areas:  policy  dialogue;  mitigation;  adaptation  and 
capacity-building. In 2007, the first finalised progress report on the EU Action Plan 
gave  important  pointers  towards  improving  the  mainstreming  effort.77  A  specific 
instrument  of  key  importance  is  the  thematic  programme  for  the  environment  and 
sustainable management of natural resources including energy (ENRTP), established 
under  the  Development  Cooperation  Instrument,  with  global  scope.  Some  of  the 
current and planned activities supported by the European Commission are presented 
below. 

Engaging in bilateral and regional climate change partnerships 

Climate change was at the top of the agenda of each and every recent international 
summit.  In  the  wake  of  the  Bali  meeting,  the  EU  engaged  with  the  authorities  of 
more  than  40  key  countries  to  share  its  views.  By  leading  the  international 
community against climate change; by pushing for ambitious adaptation, increasing 
technology  cooperation,  access  to  carbon  markets  and  combating  deforestation,  the 
EU is investing in protecting the MDGs from the threat of climate change. 

75 

76 
77 

The UNFCCC estimates that annual adaptation costs in developing countries could be between $16 and 
$80 billion. The World Bank's estimates are in the range of $10 to $ 40 billion, Oxfam's are around $ 50 
billion, and UNDP's are about $86 billion. 
See also chapter 2.3 under Environment 
The  progress  report  recommends  an  enhanced  dialogue  with  partner  countries  on  climate  change, 
improved  coordination  among  EU  donors  and  clear  assignment  of  responsibilities,  and  dedicated 
resources for the implementation of mainstreaming activities and the Action Plan. 

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Bilateral relations between the EU and its international partners include a chapter on 
climate  change  encompassing  political  dialogue  both  at  technical  as  well  as  at  the 
highest  political  levels.  With  India  and  China  for  instance,  whose  economies  are 
booming, and where environmental sustainability is therefore crucial, cooperation is 
largely about sharing knowledge and technology. In the EU-India Joint Action Plan 
of 2005, both parties recognise the urgency of dealing with climate change, and the 
cross-cutting  nature  of  its  impacts.  Actions  undertaken  include  cooperating  in  the 
fields of energy (including joint working groups on energy, specific studies on bio-
fuels,  eco-design,  carbon  capture  and  storage),  on  the  consequences  of  climate 
change (e.g. through studies on the impacts of melting glaciers in the Himalayas and 
on measuring greenhouse gas emissions in India). Similar forms of cooperation are 
being  developed  with  China.  For  example,  a  joint  project  to  design  a  near-zero 
emission coal power plant has recently attracted wide political attention. 

The Commission is also expanding its dialogue and cooperation on climate change at 
regional  level.  The  Africa-EU  Partnership  on  Climate  Change  was  launched  at  the 
Africa-EU Summit in Lisbon in December. It will provide for dialogue, cooperation 
and  exchange  on  specific  actions  to  respond  to  climate  change  and  will  be  an 
effective  channel  for  holding  deliberations  on  a  shared  Africa-EU  vision.  The 
Partnership  will  consist  of  two  pillars:  climate  change  and  land  degradation 
(desertification). A similar set of instruments tailored to the regional specificities is 
under consideration with the Latin American countries. 

The  Africa-EU  Energy  Partnership  –  also  launched  in  Lisbon  –  will  provide  a 
framework for political dialogue between Africa and the EU on energy issues, with 
an  important  link  to  climate  change.  The  Partnership  will  stimulate  the  energy 
cooperation  between  EU  and  Africa  at  various  levels,  in  particular  as  regards 
improving  access  to  modern,  affordable  and  sustainable  energy  services,  energy 
security  and  expertise  to  adapt  to  and  mitigate  climate  change  within  the  energy 
sector.  The  Energy  Partnership  will  be  supported  by  several  existing  and  new 
funding instruments that will promote sustainable and climate friendly investments.  

Allying with the poorest countries to address the effects of climate change 

In September, the EC launched the Global Climate Change Alliance (GCCA).78 This 
initiative  specifically  targets  poor  developing  countries  most  vulnerable  to  climate 
change,  in  particular  Least  Developed  Countries  (LDCs)  and  Small  Island 
Developing  States  (SIDS).  The  GCCA  aims  to  deepen  political  dialogue,  toward  a 
shared  vision  for  a  post-2012  UN  climate  change  agreement,  and  to  step  up 
cooperation  in  the  following  priority  areas:  adaptation,  reducing  emissions  from 
deforestation,  participation  in  the  global  carbon  market,  disaster  risk  reduction  and 
integrating climate change into poverty reduction efforts (more details in the box). 

Global Climate Change Alliance: key areas for increased cooperation 

Support for adapting to the effects of climate change: The GCCA will for example 
support the implementation of national adaptation action plans as well as innovative 
research solutions for adaptation. 

78 

The GCCA is also a key element of the external relations pillar of the Green Paper on Adaptation in 
Europe, adopted in June 2007. 

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Reducing emissions from deforestation: In LDCs, 62 % of total emissions originate 
in  land-use  change,  primarily  deforestation.  The  GCCA  will  support  innovative 
solutions  to  avoid  deforestation  as  well  as  expand  existing  initiatives  such  as  the 
FLEGT initiative. 

in 

the  global  carbon  market 

the  Clean 
Enhancing  participation 
Development  Mechanism  (CDM):  The  CDM  has  the  potential  to  bring  significant 
foreign  investment  to  poor  countries.  So  far,  however,  the  poorest  countries  have 
attracted  only  few  CDM  investors.  By  building  capacities  and  providing  technical 
support, the GCCA will try to promote a  more equitable geographic distribution of 
CDM projects. 

through 

Promoting Disaster Risk Reduction: There has been an increase of natural disasters 
linked to extreme weather conditions. The GCCA will assist the most disaster prone 
countries  in  building  their  capacities  to  prepare  for,  mitigate  and  prevent  natural 
disasters. 

the  GCCA  will  support  partner  countries 

Integrating  climate  change  into  poverty  reduction  efforts:  Climate  change  needs  to 
be  integrated  or  "mainstreamed"  into  poverty  reduction  strategies  to  ensure 
their 
sustainability.  Firstly, 
mainstreaming efforts. Secondly, the Commission is identifying the means to address 
climate change mainstreaming systematically at the occasion of the mid-term review 
of  Country  and  Regional  Strategy  papers  for  the  purpose  of  mainstreaming  climate 
change  fully  into  all  country  and  regional  strategies  by  2014  –  when  the  new 
programming cycle starts. 

in 

The  Commission  will  launch  this  initiative  with  €60  million,  but  much  larger 
amounts  are  needed  to  address  the  climate  change  challenge.  Therefore  the 
Commission  is  looking  towards  the  world’s  donor  community,  particularly  EU 
Member States, to contribute. Sweden was the first to pledge €5.5 million during the 
Bali climate change negotiations. The GCCA funding mechanism will be designed to 
complement  existing  climate  related  initiatives,  while  responding  directly  to  the 
needs of the countries concerned.  

Policy areas strongly linked to climate change  

Energy 

Energy  production  is  a  key  chapter  of  both  the  mitigation  and  adaptation  agendas. 
The  Global  Energy  Efficiency  and  Renewable  Energy  Fund  (GEEREF),  budgeted 
under ENRTP, is designed to provide risk capital to support projects in the area of 
renewable  energy  and  energy  efficiency  through  the  development  of  regional  sub-
funds throughout the world. The fund will be launched with over €100 million up to 
2010 with EC contributing €80 million. It is expected to mobilise €300 million from 
the private sector with up to €1 billion po ssible in longer-term. The ENRTP will also 
support  developing  countries  in  improving  their  management  of  energy  resources, 
including renewable energy and reduction of gas flaring and venting79. In 2007, the 
Energy  Facility  –  a  specific  cooperation  Instrument  to  promote  energy  services  to 
poor rural populations – awarded more than €88 million to renewable energy projects 

79 

see also Chapter 2.3 under Environment 

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in  the  African,  Caribbean  and  Pacific  States,  contributing  to  a  carbon-free 
development path. 

Water & Agriculture 

Climate  change  will  seriously  threaten  agriculture,  food  security  and  rural 
livelihoods,  implying  production  and  income  losses  in  developing  countries.  Its 
likely effects will differ across regions, posing additional risks related to movement 
of populations seeking better living conditions. This will require a response in terms 
of  adaptation  of  crops,  livestock  and  farming  practices  to  new  climatic  situations. 
This involves agricultural research and innovation at the crop/livestock level as well 
as  at  the  level  of  farm  systems.  The  EC  is  a  main  contributor  to  the  work  of  the 
Consultative Group on International Agricultural Research (CGIAR). It will support 
the  new  CGIAR  research  programme  specifically  dedicated  to  climate  change  and 
agriculture through the Food Security Thematic Programme. 

In many areas, adaptation will also involve more attention to water management, by 
means of water harvesting techniques, irrigation and drainage. Climate change calls 
for  the  improved  management  of  risks,  for  instance  through  development  of  less 
volatile  farming  methods,  the  creation  of  safety  nets,  and  the  wider  application  of 
(micro)  insurance.  Insurance  applications  can  significantly  reduce  the  effects  of 
climate  related  risks,  but  will  require  additional  efforts  to  ensure  that  the  poorer 
segments  of  the  population  will  be  fully  taken  into  account.  The  EC  will  provide 
support  to  the  so-called  Global  Index  Insurance  Facility  (€25  m illion),  an  initiative 
that  has  been  taken  with  International  Financial  Corporation  (IFC)  and  the  World 
Bank to expand the use of index insurance in sub-Saharan Africa, with applications 
in various fields, including agriculture, food security and disaster risk reduction. 

Forests 

Deforestation and land-clearing activities account for around 20% of world wide CO² 
emissions.  For  developing  countries  the  proportion  of  emissions  emanating  from 
deforestation is very high. Forests contribute to the livelihood of almost 90% of the 
1.2 billion of people living in extreme poverty in the world. The fate of forests as a 
cause,  cure  and  victim  of  climate  change  will  ultimately  affect  millions  of  people 
living  in  developing  countries,  especially  those  whose  livelihoods  depend  on  them 
for food, medicines, housing, energy and incomes. Deforestation is often a result of 
the expansion of agriculture and livestock activities and of illegal logging, which is 
often encouraged by poor governance and corruption. 

The EC has been for a long time an important supporter of protection and sustainable 
management of forests. Important programmes for the preservation of tropical forests 
have  been  extended  in  Brazil,  Latin  America  and  Central  Africa.  The  EU's  Forest 
Law  Enforcement  Governance  and  Trade  (FLEGT)  Action  Plan  aims  to  improve 
forest governance and stop illegal logging. The Action Plan stresses the key role of 
the  private  sector  and  civil  society  and  blends  measures  in  producer  and  consumer 
countries  to  eliminate  illegal  timber  from  trade  with  the  EU.  The  cornerstones  of 
FLEGT  are  Voluntary  Partnership  Agreements  (VPAs)  with  producer  countries 
suffering  from  problems  of  illegal  logging  and  poor  governance.  VPAs  use  the 
influence  of  EU  markets  together  with  development  cooperation  to  improve  forest 
management  and  governance.  Malaysia,  Indonesia,  Ghana  and  Cameroon  have 

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entered  negotiations  for  concluding  VPAs.  Ecuador  and  several  African  countries 
(Congo, DRC, Central African Republic, Cote d'Ivoire, Gabon and Liberia) have all 
expressed  an  interest  in  pursuing  them.  Others  are  likely  to  join  too  as  experience 
mounts. 

Disaster Risk Reduction 

The  number,  frequency  and  the  effects  of  disasters,  in  particular  climate-related 
disasters,  have  intensified  around  the  world  due  to  climate  change.  The  EC  is 
currently  funding  Disaster  Risk  Reduction  (DRR)  activities  around  the  globe,  at 
country level but also regionally through an ACP-EU Natural Disaster Facility which 
became operational in 2007. In order to strengthen its policy base and have a more 
comprehensive  approach  to  DRR,  the  Commission  is  currently  developing  a  DRR 
strategy  for  all  developing  countries,  to  be  adopted  in  October  2008.  This  strategy 
will  ensure  that  synergies  between  addressing  adaptation  to  climate  change  and 
disaster risk reduction are being identified and acted upon. DRR is also one of the 5 
pillars of the Global Climate Change Alliance (GCCA). 

INTERCONNECTING AFRICA 

The EU–Africa Partnership on Infrastructure: creating and sustaining regional 
infrastructure networks and services 

The  inadequacy  of  infrastructure  on  the  African  continent  severely  constrains 
economic  growth  and  hampers  human  and  social  development.  Road  transport 
accounts  for  90%  of  interurban  transport  but  physical  links  and  services  are 
inadequate. Rail network coverage is sparse and interconnectivity of networks is low. 
Due  to  poor  interconnection  facilities,  intra-African  telecommunications  are  often 
diverted  to  the  North.  Many  maritime  ports  struggle  to  offer  competitive  services 
while  inland  waterways  are  poorly  integrated  into  transport  networks.  Over  300 
million  people  –  some  42%  of  Africa’s  population  –  continue  to  have  no  access  to 
safe water. Similarly, access to basic sanitation is denied to 60% of the population. 
500 million Africans have insufficient access to electricity, which often encourages 
many  to  abandon  their  villages  in  hope  of  a  more  comfortable  life  in  the  capital 
cities.  Instead,  far  too  often,  migrants  will  find  themselves  living  in  slums  and 
degradation. 

An engine for boosting infrastructure networks 

The EU-Africa Partnership on Infrastructure aims to secure the interconnectivity of 
the  African  continent  and  its  different  regions.  It  is  one  of  the  cornerstones  of  the 
ever-stronger cooperation between Europe and Africa and it will play a key role in 
the  implementation  of  the  Joint  EU-Africa  Strategy.  The  Joint  Strategy  and  the 
associated  action  plan  establish  a  solid  framework  for  structured  political  dialogue 
and concrete cooperation between Africa and Europe. 

The Partnership aims to increase investment in infrastructure and delivery of related 
services  substantially.  It  focuses  on 
trans-boundary,  regional  and  national 
infrastructure in the widest sense: transport networks, water and energy infrastructure 
as  well  as  telecommunication  networks  and  infrastructure-related  services.  It 
provides  a  common  and  comprehensive  vision  of  the  needs  of  the  continent  and 
coordinates actions that enhance infrastructure networks across Africa. 

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By facilitating continental interconnectivity and strengthening regional networks, the 
Partnership  responds  to  the  development  goals  of  the  African  Union  and  its  New 
Economic Partnership for Africa’s Development (NEPAD). 

Interconnectivity will enhance integration, trade, growth and reaching the MDGs 

the 

infrastructure  networks 

the  Partnership  will  secure 

By  enhancing 
the 
interconnectivity  of  the  African  continent  and  of  its  different  regions  to  promote 
regional  integration.  These  interconnected  networks  will  thus  facilitate  Africa’s 
participation  in  global  trade.  The  Partnership  is  a  joint  EU-Africa  framework  that 
will  help  improve  and  increase  the  infrastructure  stock  in  the  continent.  Improving 
infrastructure,  its  related  services  and  the  regulatory  frameworks  will  contribute  to 
sustainable  economic  growth,  promote  competitive  trade,  create  employment  and 
decent work, foster regional integration and ultimately reduce poverty. 

Rapid,  sustained  and  broad-based  growth  is  essential.  A  better  inter-connected 
Africa, internally and with the rest of the world, will create larger markets and thus 
facilitate  Africa’s  reach  of  the  MDGs.  According  to  some  estimates,  a  one  percent 
increase  in  the  infrastructure  stock  could  add  one  percent  to  GDP  growth.  This 
demands a commitment to integration within coherent regional trade agreements and 
infrastructure  policies  and  regulatory  frameworks.  Good 
harmonization  of 
communication and use of appropriate technologies can accelerate the process. This 
is where EU and Africa will work together within the Partnership on infrastructure. 

What are Africa’s infrastructure needs? 

In 2005, the Commission for Africa made an estimate of the continent's infrastructure 
needs.  It  reported  that  Africa  needs  an  additional  US$  20  billion  a  year  investment 
over  and  above  current  expenditure  levels.  To  fill  this  gap,  Official  Development 
Assistance  will  not  be  enough  and  active  participation  of  private  sector  and 
development  financial  institutions  will  be  required.  The  purpose  of  two  major 
ongoing  studies  is  to  define  the  priorities  for  investment:  the  African  Infrastructure 
Country Diagnostic (AICD) study will assess the extent to which countries can scale 
up infrastructure expenditure; the AU-NEPAD Medium and Long Term Framework 
Study (MLTSF) will help to prioritise regional and continental projects. 

Financing the Partnership 

The Partnership draws upon several financial mechanisms – a Trust Fund, Regional 
and National Programmes and a programme for the start-up phase of the Partnership. 

EU Infrastructure Trust Fund for Africa – a new and innovative financing resource 

The EU Infrastructure Trust Fund for Africa is an innovative co-financing instrument 
of  the  EU-Africa  Partnership  on  Infrastructure.  It  brings  together  the  EC,  Member 
States, the European Investment Bank (EIB) and European Development Financing 
Institutions  to  pool  their  respective  efforts  and  resources  to  co-finance  relevant 
projects  directly.  The  Trust  Fund  provides  grants  that  will  attract  and  leverage 
additional funds from other donors and private investors. These grants will cover (i) 
interest  rate  subsidies;  (ii)  technical  assistance,  including  preparatory  work  for 
eligible projects such as environmental impact assessments, project supervision and 
targeted  capacity  building;  (iii)  direct  grants  for  project  components  with  a 

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substantial  demonstrable  social  or  environmental  benefit;  and  (iv)  initial-stage 
funding  of  insurance  premiums  necessary  to  ensure  the  launch  of  infrastructure 
projects. 

In the first six months, the Trust fund is already endowed with €108.7 million from 
the EC, and €27 million from contributing Me mber States. In addition, the EIB and 
other donors could commit resources in excess of €250 million. A Secretariat, hosted 
by  the  EIB,  will  ensure,  inter  alia,  the  visibility  of  the  Trust  Fund  operations  and 
provide an information access point for all stakeholders. 

To date, three projects have been already approved: 

•  The  East  African  Submarine  Cable  System  (EASSy):  a  €173  million  project 
financed with both public and private funds, to construct and operate a 10,000 km 
fibre optic submarine cable that will provide broadband connection to the Eastern 
part of Africa. With a contribution of €2.6 million for 
the hiring of a specialised 
team  to  manage  this  highly  technical  venture,  the  Trust  Fund  leverages  an 
additional  funding  of  over  €25  million  fr om  the  contributing  financiers  (EIB, 
KfW, AFD), allowing the successful completion of the EASSy project. 

•  FELOU  Hydroelectric  System:  the  Trust  Fund  will  provide  €10  million  as  an 
interest  rate  subsidy,  leveraging  an  additional  €33  million  from  the  EIB.  These 
funds  will  support  the  construction  and  operation  of  a  hydropower  plant  on  the 
Senegal  River.  This  project,  estimated  at  €102.5  million,  will  improve  access  to 
energy  services  in  three  countries  (Mali,  Senegal,  and  Mauritania),  improving 
their energy supply and security. 

•  For  the  Ethiopia-Kenya  Power  Systems  Interconnection,  the  €550,000  provided 
by the Trust Fund will leverage an additional contribution of over €350,000 from 
the KfW and the AFD. These funds will allow the completion of a feasibility and 
environmental impact assessment study, estimated at over €1.5 million. 

Regional and national programmes 

The EU Africa Partnership on Infrastructure will also draw upon resources from the 
10th  European  Development  Fund  (EDF).  Based  on  current  funding  figures, 
allocations to infrastructure could increase from €3.75 billion (9th EDF, 2002-2007) 
to  approximately  €5.6  bill ion  (10th  EDF,  2008-2013).  A  substantial  proportion  of 
this will finance the Partnership operations. 

Support to the start-up phase of the Partnership 

Several actions that support the infrastructure AU Programme include: 

•  €55m – Capacity Building  Programme for AU including resources for NEPAD's 

Infrastructure Short Term Action Plan (i-STAP); 

•  €10m – Energy Facility supporting capacity  building to African Power Pools and 

the African Forum of Utility Regulators; 

•  €20m  –  Water  Facility  and  other  instru ments  supporting  project  preparation  in 
African trans-boundary river basins; additional support to transboundary basins is 

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also  provided  in  partnership  with  AMCOW  and  through  the  African  Water 
Facility; 

•  € 18 million – River Nile Basin Initiative support; 

•  €6 million – Telecom sector regulatory reform; 

•  a  €10m  –  relevant  preparatory  AU  actions  and  studies  in  transport,  energy  and 

ICTs financing support programme; 

The Principal Partners – the African Union and the European Commissions 

The African Union Commission – its vision 

Interconnecting the African continent is seen as key for regional integration, which is 
considered by the AUC as a crucial catalyst of Africa’s Renaissance. The AUC aims 
to reach this fundamental objective through harmonization of infrastructure policies, 
strategies as well as legal and regulatory frameworks. Increasing regional integration 
within  the  framework  of  the  Partnership  will  help  the  AUC  mobilizing  resources 
more effectively in order to support the realisation of Africa’s development through 
its Regional Economic Communities and Member Countries. 

The  European  Commission  brings  valuable  experience  in  developing  infrastructure 
networks 

The EU has a long-standing experience of working with infrastructure programmes 
in  individual  African  countries.  The  EU  also  has  extensive  expertise  to  share  with 
Africa  from  its  experience  of  developing  Trans-European  Networks  (TENs)  of 
regional infrastructure for achieving economic growth and regional integration. The 
EU  has  developed  principles  that  (i)  deliver  a  rigorous  and  clear  methodology  for 
identifying  priority  projects  and  (ii)  build  consensus  among  countries  on  the 
harmonisation  of  regulatory  frameworks.  Such  knowledge  will  enrich  the  AU-EU 
dialogue. 

The  EU-Africa  Partnership  on  Infrastructure  is  a  valuable  complement  to  the  long-
term  attention  given  by  the  European  Union  to  the  infrastructure  development  in 
Africa: only in the years 2005 and 2006 (according to estimates of the Infrastructure 
Consortium  for  Africa)  the  European  Union  committed  more  that  €5  billion  for 
interventions  in  the  infrastructure  field  (which  includes  €1.4  billion  for  water  and 
sanitation  projects,  €1.9  billion  for  energy  projects  and  €2.3  billion  for  transport 
projects). 

The Partnership facilitates infrastructure sector sustainability 

The Partnership offers an integrated framework in which to coordinate the operations 
of  the  different  stakeholders  working  at  continental,  regional  and  country  level  to 
enhance each infrastructure sector to attain and sustain its individual goals. These are 
summarised as follows. 

(i) Transport: the goal is to reduce the cost and improve the quality of infrastructure 
and  services  by  promoting  optimum  use  of  existing  multimodal  transport  systems 

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and support adequate maintenance of the existing infrastructure then by completing 
trans-African and regional networks. 

•  Better  road  conditions  and  fewer  road  blocks  and  delays  at  custom  posts  will 
reduce  the  journey  times  and,  more  importantly,  journey  costs  to  ports  and 
regional  distribution  centres.  This  means  business  and  trade  between  adjacent 
countries will expand. 

•  Better  roads  and  services  will  make  farming  more  profitable.  Better  access  to 
markets  will  allow  poor  people  to  benefit  more  from  growth,  to  expand  their 
farming production and to diversify into more profitable crops. 

•  Better  roads  and  services  will  increase  access  to  health  care  facilities,  reducing 
lost time due to illness and increasing household productivity and life expectancy, 
particularly in rural communities. 

(ii)  Energy:  the  goal  is  to  facilitate  essential  investments  in  generation  and 
transmission  of  energy  based  on  renewable  resources,  develop  cross-border 
connections  and  grid  extensions,  and  promote  regional  energy  agreements  that 
improve affordability and access to energy services. 

•  Improved  access  to  electricity  and  the  availability  of  affordable  and  reliable 
energy services will allow Africa to increase industrial production and to provide 
added  value  to  agricultural  products,  contributing  towards  economic  growth  and 
creating opportunities that will lead to a reduction in poverty. 

•  Improved access to electricity will allow people to live with dignity in their home 
towns  and  villages.  They  would  not  be  forced  to  look  for  more  comfortable 
lifestyles elsewhere in capitals where they often end in slums. 

•  Improved access to clean energy will lead to a reduction in the number of people, 
most of whom are women, who suffer or die from indoor air pollution caused by 
wood burning stoves. It will also allow poor people to spend more time on income 
generating  activities  because  of  savings  in  time  to  collect  fuel  for  heating  and 
cooking. 

(iii) Water: the goal is to sustain the use of the available (and finite) water resources 
in  meeting  populations'  water  and  sanitation  needs  and  improve  national  and  local 
river  basin  catchment  management  together  with  a  larger  impact  at  trans-boundary 
levels. 

•  More  effective  management  of  water  resources  is  needed  to  secure  water 
availability  threatened  by  large  seasonal  fluctuations,  periodic  cycles  of  drought 
and flood, as well as by climate change. 

•  Nearly all of Africa’s rivers are shared between two or more countries. 

Getting  countries  to  cooperate  on  the  use  of  the  resources  of  their  shared  rivers 
through  water  resources  management  plans  is  essential  to  reduce  vulnerability  to 
droughts and to manage floods better. These plans, addressing the needs of all users, 

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should also help to strike a balance between the use of the water resources as a basis 
for livelihood and conservation of the resource. 

•  Freshwater is a finite and precious resource essential for sustaining life and human 
development. It was estimated by the Commission for Africa that, by meeting the 
MDG for access to water and sanitation in Africa, 173 million cases of diarrhoea 
would  be  avoided  each  year,  saving  some  US$1.6  billion  in  therapeutic  health 
treatment  costs,  gaining  some  456  million  productive  days  and  some  99  billion 
school days annually. 

(iv)  Information  and  Communication  Technologies:  The  goal  is  to  develop 
connections  with  the  continental  and  regional  networks  while  opening  the 
telecommunications sector to competition for efficient and low-cost provision of ICT 
services. 

•  Information & Communication Technologies will come in support of the health, 
educational  and  governmental  sector  and  while  doing  so  will  contribute  to 
achieving the social dimension of the MDGs. 

•  Poverty  is  not  reduced  by  money  alone,  it  requires  access  to  knowledge. 
Information & Communication Technologies, which are at the core of knowledge 
generation, distribution and usage. They  are also at  the foundation of improving 
business practice and efficiency. 

The Way Ahead 

The  EU-Africa  Partnership  on  Infrastructure  was  jointly  launched  by  the  African 
Union  and  European  Commission  at  the  AU  Headquarters  in  Addis  Abba  on  24 
October. The successful launch gave a significant boost to all parties involved in the 
Partnership,  which  provided  the  needed  confidence  to  move  ahead  with  its 
implementation.  Accelerating  infrastructure  and  service  delivery  means  using  the 
working modalities of the Partnership to prioritise  investments on  Africa's strategic 
networks and to scale-up financing by governments, private sector and donors. The 
Infrastructure  Partnership  will  then  effectively  contribute  to  regional  integration, 
trade, economic growth and sustainable development to reach the MDGs. 

4. 

RESULTS 

4.1. 

Project results: Results-Oriented Monitoring (ROM) 

The ROM system provides an overview of how the project portfolio is progressing 
towards  results.  The  ROM  is  based  on  regular  onsite  assessments  by  independent 
monitors of active and completed projects and programmes:  these are given simple 
scores  against  internationally  agreed  criteria  (efficiency,  effectiveness,  potential 
impact,  relevance  and  likely  sustainability)  using  a  structured  and  consistent 
methodology.  For  each  operation,  short  explanations  and  recommendations  on 
quality  improvements  are  addressed  to  all  stakeholders,  providing  important 
information  to  complement  internal  monitoring.  This  year  the  system  covered  148 
countries and 1630 operations with a total value of nearly €10 billion. 

Table 32: Quantitative overview of outputs  

EN 

128 

   EN 

Overview 
per region 

TACIS/E
NPIEast 

MED/ 
ENPI 
80

South

Africa
81

Pacific  Caribbean 

Asia 

Central 
Asia 

Latin 
America 

Total 
2007 

N° countries visited 

7 

24 

44 

16 

18 

16 

6 

17 

148 

Million € covered 

516 

1.407 

4.814 

227 

919 

982 

93 

895 

9.853 

Results  on  performance  of  operations  under  the  project  and  regional 
programme modality in 2007 

Table 33: Timeline 2002-2007 

2,9

2,8

2,7

2,6

2,5

Relevance

Impact

Sustainability

Average

Effectiveness

Efficiency

2002

2004

2006

2007

Between  2005  and  2007  ROM  scores  have  stabilised.  Relevance  has  increased  as 
devolution  has  led  to  projects  that  respond  better  to  local  needs.  Efficiency  still 
suffers  from  problems  with  the  predictability  of  funds.  This  may  also  hinder  the 
achievement  of  results  (decreased  effectiveness).  In  some  cases,  objectives  are 
overambitious. 

Quality measuring during implementation 

Projects  monitored  under  ROM  can  be  grouped  into  ones  that  achieve  "good" 
performance  and  "very  good"  performance  (yellow  and  green)  and  projects  with 
"problems" and /or "major problems" (orange and red). 

Table 34: percentage of projects "on track" 2005-2007 

80 
81 

Including Yemen.  
Including South Africa, but excluding 5 centrally managed projects 

EN 

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   EN 

 
 
 
 
                                                 
100%

80%

60%

40%

20%

0%

67%

65%

67%

very good

good

problem s

m ajor problem (s )

18%

10%

5%

4%

21%

21%

9%

4%

8%

2005

2006

2007

The share of projects with (major) problems has decreased from 10% in 2005 to 8 % 
in 200782. Analysis of the ROM data reveals several interrelations. The identification 
and design of a project are key pre-requisites for its sustainability after EC support 
has  ended.  There  is  a  high  correlation  between  ownership  and  the  effective 
participation  of  partners  during  the  design  phase.  A  major  lesson  of  ROM  is  that 
projects  need  to  put  more  effort  into  developing  appropriate  transfer  strategies  to 
better ensure the sustainability of positive effects and impacts after EC support has 
ended. Risk management during project implementation also needs more attention. 

Results by ODA sector 

As  in  2006,  the  majority  of  projects  monitored  fall  within  the  first  three  ODA 
sectors,  accounting  for  80%  of  the  monitoring  reports  produced  and  87%  of  the 
budget  monitored.  The  lower  scoring  for  the  "production  sector"  is  mainly  due  to 
delays in implementing activities in  the ACP  regions,  which  lead  to  problems  with 
achieving results. 

Table 35: Performance by ODA sector in 2007 

3,0

2,9

2,8

2,7

2,6

2,5

2,4

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Special analysis: ex-post 

y
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Relevance

Efficiency
Effectiveness

Impact

Sustainability

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A  total  of  198  completed  projects  were  monitored  "ex-post"  (as  opposed  to  1421 
active  projects).  The  share  of  projects  classified  as  very  good/good  and  as  having 

82 

Note: Projects with at least one 'd' (lowest mark) represent 8,1% whereas with an average score of 'd' 
the percentage decreases to 0,7% . 

EN 

130 

   EN 

 
 
 
 
 
 
 
                                                 
problems/major problems, remains consistent for both active and completed projects 
within each region. However, the share of projects performing really well, as well as 
that  of  projects  performing  really  poorly,  becomes 
larger  when  ex-post 
measurements  are  taken  into  account.  Good  projects  tend  to  perform  better  after 
external  assistance  has  come  to  an  end,  while  poorly  performing  projects  tend  to 
deteriorate further. 

The main lesson learned from ex-post monitoring is that, in general, the lessons are 
not being applied. Although most projects have detailed reporting systems, there are 
very  few  cases  of  projects  that  systematically  record  their  positive  and  negative 
experiences  with  a  view  to  identifying  the  most  appropriate  guidance.  This  lack  of 
capacity to identify and acknowledge how success has been achieved means that the 
same  errors  are  continuously  repeated.  Likewise,  successes  are  neither  being 
acknowledged  nor  are  they  being  applied  as  helpful  guideposts.  Another  major 
finding  is  that  the  most  crucial  factors  for  projects  to  maintain,  once  external 
assistance has ended, are policy support, ownership, and financial viability. 

Conclusions 

Ex-post  assessment  of  project  performance,  based  on  the  same  uniform  monitoring 
methodology as that used during a project's lifetime, allows results to be compared. 
This  information  can  greatly  support  the  Commission  in  managing  projects  and  in 
further  refining  development  policies.  Preliminary  testing  during  the  year  (still 
ongoing) of the ROM methodology for sector policy support programmes (SPSP) in 
Latin  America  and  the  Mediterranean  produced  useful  information  for  refining  a 
methodology that will be finalised in late 2008. 

Outlook into 2008 

The main challenges will be finalising the ROM/SPSP test phase, including in ACP 
and  Asia,  and  developing  a  system  for  better  collecting  and  disseminating 
transferable lessons and best practices. This should include systematic use of forums 
such  as  initiatives  under  the  aid  delivery  methods  programme  including  trainings, 
and Quality Support Groups to ensure that lessons from ROM are integrated in the 
operations cycle. The quality assurance of the ROM system should also be improved 
further  and  ROM  should  be  consistently  linked  with  internal  monitoring  so  as  to 
create conditions for more effective aid delivery. 

4.2. 

Evaluation: review of the 2007 work programme 

4.2.1.  Organisation of the evaluation function 

The  Evaluation  Unit  in  the  EuropeAid  Co-operation  Office  is  a  joint  evaluation 
function  for  three  External  Relations  Directorates-General:  Development,  External 
Relations and EuropeAid83. A multi-annual programme for 2007-2013 was validated 

83 

At the time of the reform of the management of external aid, it was stated that "the evaluation of the 
results of regional and sectoral policies, programmes and programming performance is crucial for the 
success of the external aid policies as a whole, and needs to feed back into the programming cycle. To 
ensure objectivity, this level of evaluation should be conducted independently and serve as a feedback 
loop for the services responsible for policy, programming and implementation. The evaluation services 
would  be  accountable  to  the  Group  of  Relex  Commissioners.  The  Group  will  decide  on  the  work 

EN 

131 

   EN 

                                                 
by the Commissioner for External Relations and European Neighbourhood Policy in 
agreement with the Commissioner for Development and Humanitarian Aid in March. 
This  programme  confirmed  the  three  main  axes  of  the  previous  period:  more 
emphasis on geographical evaluations (partner countries and regions), enlarging the 
scope of thematic and sectoral evaluations, and continuing evaluations of modalities. 

Evaluation  of  individual  projects  is  not  the  responsibility  of  the  joint  evaluation 
function,  which  is  in  charge  of  regional  and  sector  policies,  programmes  and 
programming  cycles  and  provides  methodological  support  for  all  types  of 
evaluations. 

4.2.2.  The 2007 work programme 

Eleven  evaluations  were  completed  during  this  year:  nine  geographical  evaluations 
(China,  India,  Bolivia,  Jordan,  Moldova,  Mozambique,  Pacific  Region,  Southern 
Africa  Development  Community  and  Central  America);  one  thematic  evaluation 
(Agricultural and rural development) and the synthesis of six joint evaluations with 
Member  States  on  coordination,  complementarity  and  coherence  (the  "3Cs").  Full 
texts of the evaluation reports are made public on the evaluation website84. 

Four evaluations launched at the end of 2006 have raised methodological challenges 
for  EC  external  aid.  Three  methodological  challenges  concern  aid  disbursement 
through UN offices, development banks and civil society; one concerns establishing 
an  approach  for  evaluating  budget  support  based  on  past  practical  experience.  The 
latter will be discussed with other donors. 

Eleven  new  evaluations  were  initiated:  Chad,  Uganda,  Angola,  Central  Africa 
Republic,  MEDA  Regulation,  ASEAN,  Laos,  Thailand;  education,  health  and 
poverty diseases. 

Completing  the  publication  of  the  methodological  work  in  2006,  a  set  of  four 
booklets was published in English, French and Spanish and widely disseminated. The 
full text can be found on the evaluation website85. The methodology for country level 
evaluations was presented in seminars in Spain, Sweden, Germany, Portugal, Czech 
Republic,  France,  Belgium,  Finland,  the  United  Kingdom  and  Italy.  Government 
representatives  of  evaluation  units  and  policy  units,  NGOs,  external  evaluators  and 
academics participated. 

With  regard  to  dissemination  and  feedback  mechanisms,  seven  seminars  were 
organised  in  the  countries  concerned  to  discuss  seven  evaluation  reports  (China, 
India,  Bolivia,  Jordan,  Moldova,  Mozambique  and  Nicaragua).  Furthermore,  a 
seminar was organised in Brussels to present the six evaluations on the 3Cs and the 
synthesis  report;  the  latter  was  also  presented  at  the  Council's  Development 
Committee.  The  evaluation  on  agricultural  and  rural  development  was  presented  in 

programme of the evaluation services and act on its reports recommendations". (SEC(2000)814/5 of 15 
May 2000) The new financial instruments repeat the spirit of the mandate of the evaluation: "evaluation 
of  the  results  of  the  regional  and  sectoral  policies,  programmes  and  programming  is  crucial  for  the 
success of the external aid policies." (ENPI, Article 24; DCI Article 20; IfS Article 15; and IPA Article 
22; 10th EDF implementing regulation Article 15) 
http://ec.europa.eu/europeaid/how/evaluation/index_en.htm 
http://ec.europa.eu/europeaid/evaluation/methodology/methods/mth_docs_en.htm 

132 

   EN 

84 
85 

EN 

                                                                                                                                                         
Berlin during an international conference. The "fiches contradictoires" (or follow-up 
of earlier evaluations) were published for the reports on the Caribbean, Benin, Latin 
America, Armenia, Tanzania and the TACIS region. 

4.2.3.  Lessons learned from evaluations finalised in 2007 

China:  The  Commission's  cooperation  approach  to  China  during  the  period  1998-
2006  was  relevant  to  the  Chinese  policy  context  and  needs  and  is  consistent  with 
long-term EU policy goals. At high levels, the Chinese and European sides share a 
common  language  on  partnership:  the  move  to  a  dialogue  of  equals  has  led  to  a 
progressive  phasing  out  of  development  cooperation.  Despite  policy  successes 
concrete results have been limited, because the Commission and its Chinese partners 
have  experienced  some  difficulty  in  arriving  at  agreement  on  project  goals  and 
modalities. Projects generate knowledge and expertise which are not taken up to the 
EC  policy  and  strategic  levels.  Too  many  promising  pilot  projects  have  not  been 
replicated  at  a  national  level,  as  the  results  were  not  shared  among  the  Chinese 
provincial governments. Coordination between the Commission and Member States 
is strong in form but weak on substance. 

India:  EC  aid  to  India  gained  in  relevance  and  was  better  aligned  over  the  period 
1991-2006. The shift from the project-based approach to sector support facilitated a 
qualitative  improvement  in  the  continuing  dialogue  on  development  cooperation 
between  the  Commission  and  India.  There  is  limited  but  robust  evidence  on  the 
impact of Commission support to the social sectors (health and education). However, 
sector-specific support has not contributed significantly to the current devolution of 
power to the locally elected bodies. The phasing out of rural development and stand-
alone  environment  projects,  whose  impact  is  limited,  was  appropriate.  Recent 
programmes  and  projects  to  promote  cross-cultural  economic  cooperation  and 
academic/scientific  exchanges  are  highly  valuable  responses  to  the  increasing 
diversity and maturity of EU-India relations. 

Jordan:  The  Commission's  strategy  during  the  period  1996-2006  was  aligned  on 
Jordan's  priorities  in  a  dynamic  way.  Indeed,  major  shifts  in  the  government's 
strategy were accompanied by new priorities on the Commission's side in a context 
of systematic policy dialogue and pragmatic coordination with Member States. New 
priorities were rapidly and consistently applied in the areas of poverty alleviation and 
human  rights.  Joint  policy  development  proved  to  be  an  effective  and  efficient 
approach  leading  to  tangible  impacts  on  the  competitiveness  of  small  and  medium 
enterprises  and  in  strengthening  poor  municipalities.  Impacts  were  noted  on 
economic stability and the management of urban water networks. In the trade sector, 
the Commission's  interventions were found to be  disappointing in view of the high 
expectations  placed  on  trade  liberalisation  and  export-based  development.  In  the 
latter case, these expectations were based on implicit assumptions which could not be 
confirmed.  It  took  too  much  time  to  correct  these  first  assumptions  and  the  new 
assumptions  again  were  mostly  implicit.  The  consequence  was  a  lengthy  learning 
process which in turn delayed corrective action. 

Bolivia: The evolution of the Commission's strategy during the period 1996-2006 is 
assessed  positively  by  the  national  and  international  stakeholders  and  is  relevant  to 
the needs of Bolivia. Among its intervention options, the Commission has chosen to 
prioritise flexibility to adapt quickly to changes in the Bolivian context. This choice 

EN 

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jeopardises long-term actions and the capacity to apply skills and leadership in some 
sectors.  Impact,  effectiveness  and  sustainability  of  the  interventions  have  been 
assessed  as  irregular.  The  weakness  of  certain  results  comes  from  the  pressure  to 
spend  in  an  unstable  context,  the  poor  conception  of  some  projects,  problems  with 
phasing  out  actions,  and  difficult  implementation  when  not  all  external  factors  had 
been assessed correctly. There is a gap between the request to use budget support as 
a financial modality and a context that does not present many conditions for its use. 

Moldova: EC cooperation with Moldova during the period 2000-2006 was to a large 
extent relevant to national needs and coherent with long-term EC objectives. As the 
development  context  in  Moldova  is  particularly  challenging,  major  economic 
problems must still be addressed. Nevertheless, some impacts of the EC cooperation 
can  be  noted:  the  Commission's  technical  assistance  has  significantly  advanced 
policy formulation, but the implementation of this new legislation has yet to lead to 
tangible results. For macroeconomic stabilisation, some positive assessments are also 
noted, but these rely too much on external technical assistance. Capacity building in 
some  ministries  needs  to  be  developed.  The  Commission  has  contributed  to  civil 
society  development,  mostly  in  social  service  delivery.  During  the  period  under 
review, the quality of the EC cooperation in Moldova was adversely affected by the 
low  presence  of  the  Commission  in  the  capital  Chisinau;  in  the  meantime  this 
problem  has  been  solved  by  elevating  the  status  of  the  office  there  to  a  full 
Delegation. 

Mozambique:  EC  cooperation  during  the  period  2001-2007  was  relevant  to  the 
needs  of  Mozambique  and  is  consistent  with  the  EU  policy  goals.  The  evaluation 
found that the EC cooperation in Mozambique is of high quality. The effectiveness 
of  the  Commission  Delegation  as  a  partner  of  the  government,  supporting  national 
poverty reduction, improved significantly during the review period. General budget 
support  had  positive  effects  on  the  harmonisation  of  donors  and  alignment  to  the 
government's  own  planning  process,  thereby  allowing  a  better  poverty  reduction 
focus. EC support to the national road network is nearly completed and emphasis is 
shifting to lower category roads; however, the maintenance of main roads continues 
to be deficient. EC support to the agriculture sector and food security contributes to 
the implementation of government policy and to the definition of line ministries' core 
functions. Strong support for human rights has not yet lead to results as concerns the 
performance of courts, justice and prisons. The high potential in the development of 
civil  society  organisation  was  not  addressed.  The  Commission  made  significant 
efforts  to  maximise  donor  coordination  although  complementarity  is  difficult  to 
achieve. 

(SADC):  The  EC's 

Southern  Africa  Development  Community 
regional 
intervention during the period 1996-2007 is relevant, coherent and poverty-oriented. 
However,  little  impact  could  be  measured.  The  three  main  sectors  which  form  the 
core of the intervention (trade, transport and food security) are closely inter-linked; 
some positive outcomes could be noted at national level but hardly at regional level. 
The  combination  of  an  organisation  lacking  capacity  (SADC)  with  an  organisation 
where  adherence  to  procedures  is  very  important  (the  Commission)  contributed  to 
delays  at  all  stages.  Even  if  the  attention  has  been  applied  to  capacity  building 
activities to support the SADC secretariat, the issues of the multiplicity of regional 
organisations could not have been seriously addressed, neither by SADC nor by the 

EN 

134 

   EN 

Commission. In addition, the split of SADC Member States into two EPA groups has 
definitively complicated inter- and intra-regional cooperation. 

Pacific region: The Commission's cooperation with the ACP Pacific Region during 
the period 1997-2007 was relevant to the regional context. Given the Commission's 
small  share  of  total  development  aid  to  the  region  and  the  region's  remoteness,  the 
regional interventions were justifiably focused on supporting the regional institutions 
and  on  themes  that  are  priorities  for  the  Commission  (environment  and  natural 
resources management). However, formulated to support the priorities expressed by 
the  regional  authorities,  the  Commission's  support  was  not  fully  in  line  with  the 
poverty reduction efforts in the region. The Commission did not use the full potential 
for  coordinating  and  exploiting  the  complementarities  of  its  regional  and  national 
strategies in order to maximise the impact of its assistance. 

Central  America:  During  the  period  1996-2006,  the  Commission's  strategy  in 
Central  America  showed  a  high  level  of  continuity  and  was  relevant  to  both  the 
needs  of  the  region  and  the  Commission's  objectives.  The  EC  interventions  have 
stimulated  the  dialogue  between  Central  America  and  Europe  and  have  influenced 
the  further  development  of  regional  economic  integration.  However,  the  evaluation 
to 
report 
institutional  development,  supporting  civil  society  and  ethnic  groups,  environment 
activities  and  various  social  problems.  The  report  notes  the  lack  of  coordination 
among donors even if some complementarities had been seen in certain cases. 

identifies  several  weaknesses  regarding 

interventions  related 

the 

Agricultural  and  rural  development:  The  evaluation  report  covers  the  period 
1995-2005.  It  found  that  the  EC's  strategy  as  defined  in  2002  is  a  coherent 
framework  which  covers  the  concept  of  poverty  reduction,  food  security  and  rural 
and agricultural development, but neither specifies these concepts and nor links them 
to one another. The Commission improved the quality of its programmes by using a 
more  participative  approach  and  by  being  more  closely  linked  to  partner  countries' 
institutions.  The  impacts  of  the  intervention  are  positive,  but  very  limited 
geographically.  Efficiency  is  weak  in  spite  of  flexible  financial  modalities. 
Sustainability has improved since 1995 but is still not secured. The Commission has 
played  a  role  in  reinforcing  the  importance  of  civil  society  as  an  actor  for 
the  agriculture  sector.  Coordination, 
development 
complementarity  and  coherence  with  other  EU  policies  (trade,  CAP,  etc.)  could  be 
improved. 

in  rural  zones  and  for 

Synthesis of six studies in coordination, complementarity and coherence (3Cs): 
Following the completion of six studies on the 3Cs managed by the group of Heads 
of  Evaluation  Services  of  the  EU  Member  States  and  the  Commission,  a  synthesis 
report  was  presented  to  the  Council  of  Ministers.  Its  main  findings  include:  (i)  the 
institutional  architecture  required  to  render  operational  the  3Cs  is  incomplete, 
notably concerning management; (ii) inadequate coordination, complementarity and 
coherence  reduce  the  impact  of  the  EU's  development  aid  efforts  and  leads  to 
unnecessary high demands on developing countries' human and financial resources; 
(iii) the premises or rationale for the 3Cs are not clear enough, especially in the light 
of  recent  changes  in  the  global  policy  landscape.  Several  evaluation  reports  give 
some examples of rather promising coordination processes and point to a "reservoir" 
of practical experiences that Member States and the Commission could build on. 

EN 

135 

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4.2.4. 

Synthesis of main lessons learned 

•  The  relevance  of  Commission  programming  and  implementation  is  generally 
good:  the  Commission  response  addresses  the  needs  of  partner  countries  and  is 
coherent with EU goals. 

•  Several major positive impacts have been noted e.g. on the social sectors in India, 
economic  stability  in  Jordan  and  Mozambique,  the  water  sector  in  Jordan,  food 
security in Mozambique, and economic integration in Central America. 

•  There  is  a  lack  of  sustainability  in  implementation  strategies  since  ensuring 

ownership by partner country stakeholders receives insufficient attention. 

•  Recurrent  weaknesses  in  efficiency  are  reported  to  be  due  to  delays  in 
implementation,  lack  of  flexibility  and  cumbersome  procedures  which  also  limit 
the effectiveness of Commission actions. 

•  While the high quality of projects within some sectors (such as rural development) 
is recognized, there is often a poor impact on sectoral policy of partner countries. 

•  An  impressive  increase  in  aid  expenditures  has  been  realised,  but  at  the  risk  of 

compromising the quality of the interventions. 

•  Good  results  regarding  devolution,  especially  when  delegations  are  flexible 
enough to adapt to the specific context, are counterbalanced by overly fragmented 
visions and insufficient coordination among sectors in delegations. 

•  The  Commission  has  a  particular  value  added  in  its  regional  programming; 
however, the linkage between national and regional programmes is often weak. 

4.2.5.  Outlook for 2008 

The  evaluation  programme  for  2008  will  follow  the  path  laid  in  the  multiannual 
evaluation  programme  for  2007-2013.  It  is  planned  to  launch  11  country  level 
evaluations  (Nigeria,  Namibia,  Botswana,  Burkina-Faso,  Vietnam,  El  Salvador, 
Nicaragua, Egypt, Tunisia, Niger and Senegal, the later two being joint evaluations 
with  some  EU  Member  States)  and  four  thematic  evaluations  (support  to 
decentralisation process, respect of human rights and fundamental freedoms, conflict 
prevention  and  peace  building,  employment  and  social  inclusion).  The  Evaluation 
Unit will also propose a methodological approach for evaluating budget support to be 
discussed with other donors. 

5. 

AID MANAGEMENT 

5.1. 

Developments in aid delivery modalities and channels 

Focus on sector approaches and budget support 

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136 

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During the year the Commission worked in line with the policy orientations on the 
use of the sectoral approach and budget support86. The total value of budget support 
commitments,  about  €1.79  billion,  amounted  to  almost  23%  of  total  commitments. 
This  is  a  substantial  increase  compared  to  2006,  explained  by  an  increase  in 
commitments under the EC Budget (notably in the Asia region, but also in the ENP 
region). For the EDF, budget support commitments remained broadly constant – with 
and  increased  in  general  budget  support  offset  by  a  fall  in  sector  budget  support 
commitments. 

A new set of financial instruments for providing aid came into force. Asia and Latin 
America  are  now  covered  by  the  development  cooperation  instrument  (DCI),  and 
Mediterranean and Eastern European countries by the European neighbourhood and 
partnership  instrument  (ENPI).  The  introduction  of  these  new  instruments  was  an 
important step in harmonising the use of budget support across different regions with 
a common approach to eligibility that emphasises appropriate policies and strategies, 
macroeconomic stability, and public financial management. 

To coincide with the new financial instruments, new guidance was issued. The guide 
on  general  budget  support,  first  issued  in  March  2002,  was  updated  and  issued  in 
January.  A  guide  on  support  to  sector  programmes  was  issued  in  July  (see  below). 
Significant  progress  was  made  in  harmonising  the  eligibility  criteria  for  the  use  of 
budget  support.  In  addition,  the  role  of  the  Public  Expenditure  and  Financial 
Accountability  Programme  (PEFA)  was  reinforced  with  further  encouragement  to 
use  this  assessment  as  the  favoured  methodology  to  examine  the  status  of  public 
financial management within a country. 

The Commission approach to aid delivery 

European external assistance is implemented through three main delivery modalities. 
The choices depend on a joint Commission/government analysis of the country and 
sector environment. 

The  project  approach  is  used  in  situations  such  as  support  to  non-state  actors  and 
regional  programmes,  or  where  conditions  preclude  complete  use  of  government 
systems, for example in conflict or post-conflict situations. Projects are implemented 
using the Commission’s procurement and grant award procedures. 

The sector approach, where a Sector Policy Support Programme (SPSP) is used, aims 
to  underpin  an  agreed  sector  policy  and  a  realistic  strategic  framework  monitored 
through  performance  criteria  and  indicators.  SPSPs  may  be  financed  by  (i)  sector 
budget  support  (SBS),  with  funds  transferred  to  the  national  treasury  of  the 
beneficiary  country;  (ii)  pooling  funds  with  beneficiary  governments  and  other 
donors,  or  (iii)  project  procedures  using  Commission  procurement  and  grant  award 
processes. 

The  Commission  also  supports  national  or  macro  level  goals  expressed  in  national 
policy  and  strategy  documents  (such  as  a  Poverty  Reduction  Strategy  Paper).  This 
assistance is financed through General Budget Support (GBS), with funds transferred 

86 

See box EC Approach to Aid Delivery for definitions and policy orientations for the Commission in this 
area 

EN 

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   EN 

                                                 
to  the  national  treasury  of  the  beneficiary  country.  It  is  usually  accompanied  by 
the  area  of  public  financial 
capacity  development  activities,  generally 
management. 

in 

At a policy level the sectoral approach and the use of budget support as a preferred 
aid  modality  follow  the  orientations  of  the  European  Consensus  on  Development, 
which states that “where circumstances permit, the use of general or sectoral budget 
support  should  increase  as  a  means  to  strengthen  ownership,  support  partner’s 
national  accountability  and  procedures,  to  finance  national  poverty  reduction 
strategies  (PRS)  and  to  promote  sound  and  transparent  management  of  public 
finances”.  In  addition,  the  Paris  Declaration  of  March  2005  has  created  positive 
momentum  for  budget  and  sector  support  focusing  on  ownership,  alignment  and 
harmonisation.  The  declaration  contains  twelve  indicators  to  measure  progress  in 
these  areas,  laying  great  emphasis  on  the  use  of  the  sector  approach  and  budget 
support. These forms of aid delivery are, by their very nature, aligned with country 
systems,  avoid  parallel  implementation  structures,  and  favour  a  synchronized 
approach  to  capacity  development  and  the  use  of  joint  field  missions  and  shared 
analysis. 

Methodological work and training  

Developing  the  skills  and  capacities  of  key  actors  intervening  in  the  design  and 
implementation  of  EC-funded  programmes  is  crucial  for  improving  their  quality, 
impact and sustainability. A significant effort was made to develop methodology and 
training  in  various  areas  related  to  sector  approaches,  such  as  public  financial 
management, 
applied 
macroeconomics. 

development, 

institutional 

capacity 

analysis 

and 

This year substantial methodological work was achieved, in areas such as guidance 
on  sector  support,  decentralisation  and  local  governance,  project  monitoring,  and 
support to reform processes, in particular in public financial management, and more 
generally in capacity development. 

The  new  Guidelines  on  Support  to  Sector  Programmes,  covering  sector  budget 
support, pool funding and EC project procedures, are a major achievement. Building 
on lessons learned since 2003, these guidelines promote a context-sensitive approach 
integrating  lessons  learned  in  working  with  sector  approaches  in  new  geographical 
areas  and  in  sectors  where  projects  have  been  dominant  so  far.  They  explain 
eligibility  criteria  for  sector  budget  support  and  provide  reference  material  in  all 
seven  areas  of  assessment,  including  policy  analysis,  annual  budget,  sector 
coordination,  performance  measurement,  capacity  assessment,  public  financial 
management, and macroeconomics. The guidelines have been well-received by other 
donors  and  are  useful  for  supporting  aid  effectiveness  work  and  dialogue  among 
sector stakeholders. 

A new series of methodological publications, the "Tools and Methods Series"87, was 
launched  in  the  second  half  of  the  year.  This  series  includes  three  types  of 
documents:  guidelines  providing  guidance  on  how  to  design  and  implement  EU 

87 

EN 

these 

All 
public 
http://ec.europa.eu/europeaid/multimedia/publications/index_en.htm 

documents 

accessible 

are 

the 

to 

on  AIDCO 

internet 

site 

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   EN 

                                                 
financed  programmes;  reference  documents  developing  concepts  and  insights  in 
working  practices,  and  concept  notes  focused  on  deepening  the  understanding  of  a 
given  topic.  The  intended  public  includes  Commission  staff,  but  also  external 
stakeholders involved in the management of external assistance in partner countries 
and  other  donors.  The  series  supports  improvements  in  the  quality  of  EC-funded 
projects  in  line  with  aid  effectiveness  principles  as  well  as  enhanced  visibility  for 
Commission work. In addition to the guidelines on sector support various documents 
were  published.  The  reference  document  Institutional  Assessment  and  Capacity 
Development  offers  a  conceptual  framework  for  dealing  with  institutional  and 
capacity assessment mainly in the public sector. The reference document Supporting 
Decentralisation and Local Governance in Third Countries provides practical tools 
to develop a shared understanding of decentralisation and to improve the design and 
implementation  of  EC  support  in  this  field.  The  reference  document  Strengthening 
Project  Internal  Monitoring:  How  to  Enhance  the  Role  of  EC  Task  Managers  has 
two  objectives,  namely  to  support  effective  monitoring  by  project  implementing 
partners and to support good management of monitoring at the level of Delegations 
through practical tools. 

Progress was also made in the transport sector. Based on the idea of presenting the 
collective  experience  of  Commission  colleagues  as  an  aid  to  Delegations  in  their 
everyday  work,  an  Operational  Handbook  for  Road  Project  Managers  in 
Delegations  was  published  in  February.  It  reflects  Commission  transport  policy 
documents  and  aims  to  provide  project  managers  with  useful  information  to  help 
them  prepare  and  implement  road  infrastructure  projects,  particularly  in  ACP 
countries. 

The work initiated in 2006 for a more strategic and co-ordinated approach in the area 
of institutional support and capacity development in partner countries was developed. 
In  collaboration  with  two  multi-donor  networks  –  the  Learning  and  Exchange 
Network on Capacity Development and "Train4dev" – the Commission successfully 
launched  the  development  of  a  "joint  learning  package"  for  use  of  all  donors 
intervening  in  a  given  sector,  based  on  its  own  material  and  experience.  The 
Commission is making a substantial effort to develop the capacity of its staff through 
regular and innovative training programmes which focus on the development of both 
practical  and  conceptual  abilities.  Within  the  donor  community,  EuropeAid  is  a 
major  "training  producer"  in  the  area  of  aid  delivery  methods  with  more  than  215 
sessions  organised  and  more  than  4100  participants  during  the  period  June  2005- 
December 2007 (see table below). 

Table 36: Methodological Training organised from June 2005 to December 2007 

Project  Approach  and  related 
topics 

Sector/Budget 
related topics  

Support 

and 

Number of 
courses 

Number of 
participants 

Number of 
courses 

Number of 
participants 

At Headquarters 

At country level 

45 

36 

889 

754 

73 

61 

1218 

1305 

EN 

139 

   EN 

  
Total 

81 

1643 

134 

2523 

In  the  category  of  project  approaches,  this  year  new  trainings  were  developed  on 
enhancing  project  monitoring  systems;  managing  participatory  approaches  and 
stakeholder analysis; and taking into account the cultural dimension in the design and 
implementation of projects. In the area of sector and budget support, new advanced 
courses  were  developed  in  the  area  of  public  financial  management  (PFM)  and 
applied  macroeconomics.  Training  in  PFM  is  scoring  very  high,  both  in  terms  of 
attendance and in terms of quality (average evaluation score is 4/5). Sector specific 
seminars  continued  to  be  developed  in  the  area  of  water,  transport,  education, 
decentralisation and local government with very positive evaluations. The quality of 
methodological  training  is  consistently  evaluated  as  good,  very  good,  or  excellent, 
and the total average score is 3.9/5. Impact assessment exercises were conducted on 
the  two  main  trainings.  These  confirmed  that  the  courses  were  well-received  by 
participants, particularly in terms of accessibility and quality. 

5.2. 

Progress on qualitative issues in aid management 

Design quality of operations 

The Commission has developed a structured system to screen and support quality of 
operations  at  the  stages  of  identification  and  formulation  –  the  Office  Quality 
Support  Group  (oQSG)  system.  During  2007,  the  functioning  of  this  system  was 
consolidated  further.  The  methodology  was  revised  and  doing  so  proved  useful.  In 
terms  of  coverage,  147  meetings  were  organized  (53%  increase  in  comparison  to 
2006)  and  almost  900  operations  were  screened  (63%  increase)  corresponding  to 
nearly  €6.3  billion.  The  ratio  of  well-de signed  projects  submitted  to  oQSG  has 
reached  88.5%88.  The  overall  results  of  the  oQSG  are  encouraging  especially 
considering  that  considerable  strain  was  put  on  the  system  this  year  for  several 
reasons,  including  the  late  approval  of  the  new  financing  instruments  and 
programming  documents,  the  tight  deadlines  imposed  by  changes  in  the  financial 
instruments  and  new  procedures,  the  "cut  off"  date  of  end  July  for  the  approval  of 
projects financed under the 9th EDF, and the scale-up of aid. 

Developments in working with indicators  

Several  exercises  are  continuing  in  the  area  of  performance  measurement  and 
indicators. EuropeAid's performance indicators are a set of central indicators which 
track data on financial, quality, internal processes and staffing. They were reviewed 
and  expanded  in  2005.  Regular  reports  on  EuropeAid's  activity,  which  include 
indicators, are submitted to the Group of External Relations Commissioners. 

The MDGs are the key development outcomes the EC is working to achieve between 
now and 2015, along with the rest of the international community. The Commission 
has  worked  with  an  expert  group  of  Member  States  and  other  interested  parties, 
including the OECD DAC, UNDP and the World Bank, to develop a core set of ten 
indicators  drawn  from  the  MDGs,  the  Millennium  Development  Indicators.  Six  are 

88 

As this indicator measures the quality of the documents discussed during oQSG step II, it precludes the 
further improvements before the Financing Decision is taken. 

EN 

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directly  related  to  the  well-being  of  children,  while  three  have  a  specific  gender 
dimension. All country strategies include the last available data for each indicator. In 
addition, country strategy papers will also measure progress against a wider range of 
country-specific  indicators, which should reflect the focal sectors identified  as well 
as overall movements in poverty. 

In using the classic project approach, renewed attention is given to appropriate use of 
the  "Quality  Frame",  a  tool  for  assessing  project  quality  based  on  three  attributes 
(relevance,  feasibility  and  effectiveness)  introduced  with  the  Project  Cycle 
Management  Guidelines  issued  in  2004.  These  recommend  the  use  of  the  logical 
framework  approach  and  of  SMART  indicators  identified  at  each  level  of  the 
framework: results, purpose and overall project objective. These indicators are then 
referred  to  in  monitoring  and  evaluation.  When  using  budget  support  programmes, 
disbursements  are  linked  to  the  evolution  of  key  outcome  indicators  such  as  child 
vaccination, girl enrolment in primary schools, primary school completion rate, etc. 

The  Commission  wants  to  equip  itself  progressively  with  measuring  tools  enabling 
the  assessment  of  the  quantifiable  effects  of  its  operations  in  order  to  report  on 
development  results  and  enhance  accountability  to  the  European  Parliament  and 
Member  States.  This  concept  of  accountability-reporting  has  been  developed  in 
agreement with the commitments under the Paris Declaration to enhance donors' and 
partner countries' respective accountability to their citizens and parliaments and with 
the  importance  given  to  progress  indicators  in  the  European  Consensus  on 
Development  and  the  DCI  regulation.  For  this  purpose,  on  1  September  the  pilot 
phase  started  of  systematic  use  of  a  selected  list  of  standard  result  indicators  in  a 
limited  number  of  sectors  including  human  development,  good  governance,  food 
security  and  rural  development,  which  are  key  areas  for  MDGs  progress.  These 
indicators  will  be  aggregated.  To  measure  the  effectiveness  of  external  aid,  and  to 
appraise trends over a given period of time, quantifiable performance indicators are 
applied. 

In making available pertinent development indicators, the Commission's support for 
high  quality  statistics  is  instrumental.  The  key  elements  consist  of  preparing  and 
implementing  a  national  statistics  development  strategy89  that  has  full  national 
political  support  and  that  is  compatible  with  the  national  development  programme, 
such as a poverty reduction strategy. A national statistics development strategy will 
prioritise needs for statistics to develop, monitor and evaluate economic, social and 
environmental policies in a sustainable programme. This is the quantitative element 
of  good  governance.  Increased  demand  for  quality  statistics  has  resulted  in  the 
Commission  participating  in  the  multi-partner  programme  for  scaling  up  of 
assistance to statistics. 

Developing thematic networks 

To  strengthen  EuropeAid's  supporting  role  in  improving  the  quality  of  operations, 
several  thematic  networks  have  been  created  in  recent  years  to  promote  better 
sharing of information with Delegations and other members of the External Relations 
Directorates General. These networks, e.g. on budget support, transport, water, food 

89 

See www.paris21.org. Other equivalent methodologies are also available. 

EN 

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security, or urban development, are proving to be effective tools. In 2008 new tools 
and technologies will be introduced to support the networks. 

5.3. 

Cooperation with international organisations and other donors 

Cooperation  and  partnership  with  the  UN  and  the  World  Bank  has  remained 
significant,  with  contributions  amounting  to  just  under  €1.3  b illion  in  2007.  While 
commitments  to  the  UN  system  fell  slightly,  this  reflects  changed  responsibilities 
with respect to food aid, which is now managed by the Commission's Humanitarian 
Aid  Directorate  General  (DG  ECHO),  and  does  not  signal  a  slowdown  in 
Commission-UN  cooperation.  Cooperation  otherwise  has  remained  strong  with  the 
UN  and  the  World  Bank  working  together  with  the  Commission  to  support 
programmes in areas such as election monitoring and assistance, institution building, 
rehabilitation, rural development, education and health. Cooperation also takes place 
with  regional  development  banks  such  as  the  African,  Asian  and  Inter-American 
Development Banks. 

Requiring prerequisites before working with international organisations provides the 
Commission with the confidence that such organisations meet international standards 
as  regards  accounting,  external  audit,  internal  control  and  procurement.  During  the 
year,  this  compliance  analysis  was  successfully  completed  for  the  main  UN 
organisations and the World Bank. 

The United Nations 

Sharing  common  objectives  and  values,  and  similar  policy  priorities  in  poverty 
reduction,  democratic  governance,  crisis  prevention  and  recovery,  inter  alia,  the 
Commission  and  the  UN  are  now  working  together  in  over  105  countries,  as 
illustrated in the latest report on UN–Commission cooperation produced by the UN 
in 2007 with Commission support90. 

The  Commission  and  the  UN  continued  to  streamline  the  way  they  work  together 
under  the  2003  Financial  and  Administrative  Framework  Agreement  (the  FAFA). 
The  annual  meeting  saw  the  adoption  of  joint  reporting  guidelines,  and  throughout 
the  year  staff  from  both  the  UN  and  the  Commission  participated  in  joint  training 
initiatives  to  help  foster  mutual  understanding  and  ensure  that  together  their 
institutions  can  deliver  a  better  service  to  partner  countries.  Moreover  the 
Commission  offered  the  UN  training  on  how  its  works  with  the  UN  (use  of  joint 
management, FAFA and applicable procedures). 

UNDP continues to be the Commission's main partner, with major rehabilitation and 
reconstruction  programmes.  Support  for  elections  is  also  an  area  where  the 
Commission  and  UNDP  have  increasingly  cooperated.  The  Operational  Guidelines 
for  the  Implementation  of  Electoral  Assistance  Programmes  and  Projects,  first 
agreed  with  UNDP  in  2006,  were  reviewed  this  year.  This  partnership  has  already 
proved  to  be  of  great  value  to  partner  countries  and  the  updated  guidelines  will 
improve even further the way election support is implemented. At the end of 2006 an 
evaluation  was  launched  of  Commission  financing  channelled  through  the  UN 

90 

"Improving  Lives",  produced  by  the  UN  office  Brussels  with  Commission  support,  available  on 
www.unbrussels.org/improvinglives.pdf 

EN 

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system.  Most  phases  of  this  evaluation  were  completed,  including  a  series  of  field 
trips  to  locations  where  the  UN  is  managing  EC-funded  programmes.  The  final 
report is expected for the first half of 2008. 

The World Bank  

The Commission remains one of the main donors to multi-donor trust funds managed 
by  the  World  Bank.  The  Commission  is  conscious  of  the  need  to  ensure  that  these 
substantial amounts are properly managed, reported on and accounted for. In 2001 it 
signed a Framework Agreement with the Bank, which is jointly reviewed each year 
and  has  been  updated  on  several  occasions  in  relation  not  only  to  financial 
management but also on issues such as visibility. The Bank manages over 900 trust 
funds,  each  with  its  own  remit,  rules  and  governance  structure.  Most  are  relatively 
small. This is a significant management problem for the Bank. The Commission fully 
supports the Bank's efforts to make these trust funds more transparent and to simplify 
the procedures which govern them. 

Operational co-ordination with the World Bank is extremely good and relations in-
country  between  the  Commission's  Delegations  and  the  Bank's  offices  help  to 
reinforce  the  frequent  contacts  at  headquarters  level.  The  Bank's  representative  in 
Brussels  and  the  Commission's  Delegation  in  Washington  also  help  to  support  the 
cooperation. In some of the key programmes, such as in aid to the Palestinians and in 
Iraq, the need for a common approach is reinforced. Progress was also made on the 
continuing evaluation of EC contributions to World Bank Trust Funds. 

OECD/DAC 

The  DAC  reviewed  the  development  cooperation  policies  and  programmes  of  the 
European Community during 200791. The OECD report highlights the Commission's 
achievements over the past years as an effective aid donor in its own right and as a 
"Federator" of aid from the 27 EU Member States. 

The  OECD  also  shows  the  Commission's  unique  role  in  current  development 
thinking:  policy  coherence;  promoting  aid  effectiveness;  developing  new  aid 
modalities,  for  example  for  budget  support;  and  fragile  states.  The  OECD  sees  the 
Commission  as  a  driving  force  for  the  future.  In  addition  to  continuing  to  lead  the 
scaling-up,  aid  effectiveness  and  policy  coherence  debates,  the  OECD  sees  added 
value  for  the  Commission  in:  managing  the  growing  pool  of  Official  Development 
Assistance  as  EU  Member  States  increase  aid  budgets;  creating  an  EU  system  of 
performance  management  for  development  projects;  intensifying  the  dialogue  with 
civil  society  and  communication  with  the  wider  public;  and  creating  an  explicit 
framework to engage with multilateral institutions, such as the World Bank and the 
United Nations. 

Council of Europe 

With  the  signature  in  May  of  a  Memorandum  of  Understanding  on  enhanced 
cooperation  and  political  dialogue  between  the  EU  and  the  Council  of  Europe,  the 

91 

DCD/DAC/AR(2007)2/EC/PART1/FINAL  and  DCD/DAC/AR(2007)2/EC/PART2/FINAL  of  4  and  9 
July 2007 respectively 

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relations between the two organisations were deepened. The Commission contributed 
significantly  to  the  negotiating  process  and  is  already  very  active  in  implementing 
the  Memorandum.  This  is  borne  out  by  the  increasing  volume  of  joint  projects, 
reaching  over  €80  million  at  the  end  of  2007.  The  shared  values  of  pluralistic 
democracy,  the  rule  of  law,  and  human  rights  and  fundamental  freedoms  form  the 
core  areas  in  which  the  Commission  and  the  Council  of  Europe  concentrate  their 
cooperation,  which  is  particularly  fruitful  in  the  countries  participating  in  the  EU’s 
Neighbourhood Policy and the Enlargement process. 

OSCE 

In 2007, the usual productive cooperation between the EU and the OSCE translated 
into numerous practical accomplishments, such as EUBAM (European Union Border 
Assessment Mission) in Moldova, BOMCA (EU Border Management Programme in 
Central  Asia)  and  CADAP  (EU  Central  Asia  Drug  Action  Programme)  in  Central 
Asia, the OSCE-led rehabilitation programme in South Ossetia, and ripe cooperation 
with ODIHR (Office for Democratic Institutions and Human Rights). 

Cooperation with other donors  

Cooperation  was  driven  by  the  Paris  Declaration.  In  addition  to  participating  in 
relevant OECD-DAC forums, the Commission established a permanent network with 
the development institutions of the Member States, the European Development Aid 
Practitioners  network  to  exchange  views  on  best  practices.  The  Commission  also 
supports the Outreach Strategy established by the OECD/DAC. 

A major change was the possibility, opened by the new Financial Regulation which 
came  into  force  in  May,  to  co-finance  with  bilateral  donors.  By  the  end  the  year, 
eight aid agencies had expressed their interest in this form of co-financing and six of 
them are undergoing the assessment procedure, which is a pre-requisite for the EC to 
co-finance in this way. 

The  Commission  is  committed  to  a  process  of  dialogue,  mainly  with  China  in 
association  with  the  African  Partners  and  the  African  Union.  This  process  aims  to 
foster  understanding  of  respective  policies  and  explore  potential  synergies,  on,  for 
example,  security  and  stability,  or  infrastructure  development.  This  could  lead  to  a 
broader consultation process including bilateral dialogue at the highest level (such as 
the  EU-China  and  EU-Africa  Summits).  Cooperation  with  other  emerging  donors 
such  as  India,  Russia,  South  Korea  and  Turkey  is  also  becoming  increasingly 
important. 

5.4. 

Simplification of procedures 

The  Commission  has  been  engaged  in  a  drive  to  make  the  rules  for  managing 
external  assistance  simpler  and  more  visible.  This  year's  entry  into  force  of  a  new 
legal  and  financial  framework  for  the  management  of  external  assistance  was 
evidence  of  this  effort.  Innovations  included  revised  Financial  Regulations  and  the 
new  instruments  for  external  assistance.  These  not  only  rationalise  the  number  of 
applicable legal bases, but also introduce several measures that facilitate the delivery 
of  external  assistance,  including  (i)  identical  rules  for  all  instruments  (harmonised 
eligibility  rules,  procedures  and  financing  mechanisms);  (ii)  the  opening  up  of 
contracting procedures to co-financing mechanisms (with the possibility to use local 

EN 

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rules  or  rules  agreed  between  donors);  (iii)  greater  flexibility  in  calculating 
contracting deadlines (the so-called d+3 rule); (iv) higher thresholds for procurement 
procedures;  (v)  new  provisions  facilitating  the  administration  of  documentary 
evidence  for  tenders  or  for  purchases  under  particularly  advantageous  conditions; 
and  (iv)  the  possibility  to  make  grants  to  entities  without  legal  personality  or  in 
cascade and new cases of full financing. 

All  these  innovations  were  incorporated  in  a  new  version  of  the  Practical  Guide  to 
contract procedures, which also covers the rules applicable to actions financed under 
the European Development Fund92. In addition to innovations that will be introduced 
with the entry into force of a new legal and financial framework for the 10th EDF, an 
effort was made to simplify the contractual documents for the EDF to ensure greater 
coherence in the application of the rules in question. 

5.5. 

Visibility and communication 

Communicating  on  the  role  of  the  EU  remained  a  priority  for  the  Commission. 
Numerous events took place within the context of the celebrations around the fiftieth 
anniversary  of  the  Treaty  of  Rome93.  The  Commission  also  produced  a  youth 
newspaper  entitled  50  Years  /  50  Stories  of  Solidarity  in  15  languages  and  some 
450.000 copies. This was widely distributed, including through schools participating 
in the annual 9 May initiative in schools, which this year reached some 97,000 pupils 
from over 4400 classes in around 50 regions. 

The second EU Development Days were held in Lisbon from 7 to 9 November. This 
year’s forum focused on climate change and how to respond to the needs of already 
vulnerable  countries  hardest  hit  by  its  impacts.  A  new  website  on  external 
cooperation,  available  in  22  languages,  was  launched  in  September.  New  videos 
were released on cooperation in the area of water and of food security. The External 
Cooperation Info Point received 7000 visitors over the year. Discussions with the UN 
and the World Bank on joint visibility guidelines progressed over the year and were 
expected to be concluded in early 2008. 

6. 

ANNEXES 

6.1. 

Introduction to financial tables 

The Annual Report provides an overview of policies, objectives and achievements in 
2007.  The  tables  and  graphs  that  follow  present  the  main  figures  of  development 
assistance in the year, featured by country, region, sector and per source of funding, 
i.e. EU external assistance instrument. 

2007  was  the  first  year  of  a  new  financial  programming  period  of  the  EU  Budget, 
with a whole new set of instruments coming into force, and the final year of an EDF 
funding  cycle  (9th  EDF);  in  financial  terms  it  was  thus  not  a  "mainstream"  year. 
Nevertheless  the  tables  2007  show  again  an  improvement  of  overall  Official 
Development Assistance levels. As regards poverty focus, the figures show that the 

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An overview of events is available at http://europa.eu/50/around_world/index_en.htm 

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trend of the previous years is consolidated and sustained, with again an increase of 
the  share  going  to  least  developed  countries  as  well  as  the  share  of  allocations  to 
social sectors. 

The  first  table  shows  the  importance  of  external  assistance  (EA)  in  the  overall 
expenditure  of  the  European  Commission.  Defined  as  the  resources  used  to  foster 
programmes and projects beyond the European Union, EA accounted for 9% of the 
total  allocation  in  2007  (General  Commission  Budget  and  EDF)  –  Fig  6.1.  The 
decrease from 2006 (10%) is mainly due to the accession of Romania and Bulgaria to 
full membership of EU. 

The sources of EA are the General Budget of the EC and the European Development 
Fund.  A  global  overview  of  the  share  of  resources  will  be  found  in  Figure  6.2.  A 
detailed breakdown of the budget – Table 6.3 – identifies the different policy areas 
that  contribute  to  this  external  assistance  effort.  A  similar  breakdown  for  the  EDF 
can  be  found  in  Table  6.4.  For  the  first  time  these  tables  also  show,  for  this 
breakdown, the part that was counted as Official Development Assistance (ODA). 

ODA  is  also  sometimes  referred  to  as  "Development  Assistance"  or  "Development 
Co-operation". The concept of ODA used throughout the tables and figures is the one 
defined  by  the  OECD  DAC  (Development  Assistance  Committee)  and  reported  by 
the  EC  to  this  body.  The  same  applies  to  OA  (Official  Assistance).  Not  all  EC 
external assistance can be reported as ODA or OA. Whether an action, programme or 
project is classified as ODA or not depends on the recipient country and the purpose 
and content of the aid. 

Figures 6.5 and 6.6 show the share of EC's external assistance classified as ODA, OA 
or neither. 92%  of  the  total  resources  of EC external assistance committed in 2007 
are considered reportable as ODA, showing an increased developmental focus of the 
external financial allocations. 

Turning to beneficiary countries and regions, Fig 6.7, and tables 6.8 and 6.9, present 
the  breakdown  per  region  and  per  country.  For  this  breakdown  it  is  necessary  to 
differentiate  between  bilateral  and  multilateral  aid.  Bilateral  aid,  as  defined  by  the 
Development Assistance Committee, is direct co-operation by the EC with a country 
(or region) where the EC controls the activities and knows how, when and where the 
resources are being spent. Multilateral aid comprises direct contributions to the core 
funding of multilateral agencies, who report back to the Commission at a later stage 
about the expenditure. 

Fig  6.7  gives  a  breakdown  of  EC  ODA  per  region.  Africa  continues  to  be  the  top 
ranking  region  (38%  of  ODA,  same  share  as  in  2006).  Overall  Sub-Sahara  Africa 
gets one third of total ODA committed in 2007. Asia continues to rank 2nd in 2007, 
though decreasing slightly its relative share (17% against 19% in 2006), with Europe 
now  coming  a  close  3rd  (16%).  Fig  6.8  presents  regional  distribution  of  ODA  to 
developing countries over the period 2003-2007. 

A  more  detailed  breakdown  for  2007,  per  country  and  region,  in  line  with  OECD 
DAC countries list, can be found in Table 6.9. From the country allocated aid (thus 
excluding  regional  programs  and  Least  Developed  Countries'  programs  unspecified 
at this stage), the top ten ODA countries in 2007 included Turkey, Palestinian Adm. 

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Areas, Serbia, Ethiopia, Afghanistan, Morocco, Ukraine, Sudan, South Africa, India. 
This  top-ten  list  is  broadly  the  same  as  in  2006,  the  differences  being  Sudan  and 
South Africa (in) and Democratic Republic of Congo and Indonesia (out). 

It is also important to identify the main sectors of activities that receive support. Fig 
6.10 shows this breakdown of EC ODA per main sector as defined by the DAC. The 
tables  show  a  confirmation  of  the  upward  trend  of  the  share  devoted  to  social 
infrastructure  and  services  (education  and  health,  water  management,  civil  society, 
government, etc.) within total ODA, with an all time high peaking at 42,8%. A more 
detailed sector breakdown of ODA is provided in Table 6.11  for commitments and 
table 6.12 for payments. 

Table 6.13 gives an overview of ODA managed by EuropeAid, with a breakdown per 
sector  and  region  managed.  In  this  table  the  region  is  defined  with  the  country 
groupings used in the EC instruments and corresponding budget structure. 

The 2007 report provides an additional table intended to meet information concerns 
expressed  by  the  budget  authority  during  the  legislative  process.  Table  6.14  shows 
the  sector  breakdown  of  ODA  per  EC  External  Assistance  Instrument  and  sub-
component within the Instruments, with the associated graph 6.15 providing a clearer 
picture.  

Finally, the remaining tables and graphs show the evolution over time, from 2001 to 
2007,  of  external  assistance  and  ODA:  Fig.  6.16  shows  the  evolution  of  the  main 
sources  of  funding  (External  assistance  from  EC  Budget  and  EDF,  with  the  share 
managed  by  EuropeAid),  Fig  6.17  shows  the  evolution  of  total  ODA  and  OA 
volumes  committed  and  disbursed,  and  Fig.  6.18  shows  the  evolution  of  the  sector 
breakdown of ODA.  

EN 

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6.2. 

Financial tables 

Fig 6.1. Percentage of Commission  Budget committed on External Assistance in 2007.

External Aid 
(Budget + EDF), 
10 625 M€, 9%

Commission 
Budget without 
External Aid, 113 
338 M€, 91%

Commitments ( € Million )

Commission Budget without External Aid

External Aid (Budget + EDF)

Commission Budget + EDF

113 338 M€

10 625 M€

123 963 M€

EN 

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Fig.6.2. Sources of External Assistance in 2007.

non EuropeAid 
Budget, 2 581 
M€, 24%

EuropeAid 
Budget, 4 408 
M€, 42%

EuropeAid EDF, 
3 636 M€, 34%

Commitments ( € Million )
EuropeAid Budget
EuropeAid EDF
non EuropeAid Budget

External Aid (Budget + EDF)

4 408 M€
3 636 M€
2 581 M€

10 625 M€

EN 

149 

   EN 

 
Fig.6.3. General Commission Budget for External Assistance in 2007.

Total

Managed by 
EuropeAid

Managed by other 
DG's

of which ODA

 Heading / Policy 
Area

Description

Comm it.

Payments

Commit.

Payments

Commit.

Payments

Commit.

Payments

4 01 - ECFIN Macroeconomic assistance + EBRD
4 04 - EMPL

4 05 - AGRI

4 06 - ENERGY

4 07 - ENV

1 08 - RTD

The Sapard pre-accession instrument — 
Completion of the programme (2000 to 2006) 
Completion of Intelligent energy — Europe 
programme (2003 to 2006): external strand — 
Coopener
LIFE (European Financial Instrument for the 
Environment)
Combating major diseases + Specific measures in 
support of international cooperation
International fisheries agreements

2 11 - FISH
4 13 - REGIO Pre-accession IPA and former ISPA.

4 14 - TAXUD Customs cooperation and international assistance

4 15 - EAC

4 17 - SANCO

4 19 - RELEX

4

4

4

4

4

4

4

4

Education
International agreements and membership of 
international organisations
Multilateral relations, cooperation in the areas of 
migration and asylum, and general external 
relations matters
Common foreign and security policy
European initiative for democracy and human 
rights (EIDHR)
Relations and cooperation with industrialised non-
member countries
Crisis response and global threats to security
European Neighbourhood Policy and relations 
with Russia
Relations with Latin America
Relations with Asia, Central Asia and East of 
Jordan countries
Policy strategy and coordination for External 
relations policy area

4 20 - TRADE External trade relations
4 21- DEV
4

Food security
Non-State actors in development
Environment and sustainable management of 
natural resources, including energy
Human and social development
Geographical cooperation with ACP Countries 

57.88
64.78

23.24

5.96

291.07

57.88
64.78

23.24

57.88
64.78

5.96

291.07

1.93

1.93

20.21

7.42

1.31

2.00

9.03

2.00

9.03

0.36

5.37

152.79

159.20
643.28

0.91

22.87

0.29

127.78
221.77

0.50

26.71

0.33

152.79

159.20
643.28

0.91

22.87

0.29

127.78
221.77

0.50

26.71

0.33

62.74

5.25
0.12

6.26
221.77

20.50

19.96

47.96

18.79

47.96

18.79

47.96

17.77

159.47

89.89

159.47

89.89

133.34

123.90

133.34

122.68

1.22

133.34

121.82

24.48

11.60

212.05

104.59

113.90

73.25

1 628.88

1 400.82

1 628.88

1 400.82

339.76

341.00

339.76

341.00

836.58

791.15

836.58

791.15

24.98

22.13

15.95

12.66

14.27
201.28
210.85

8.07
301.38
168.55

201.28
210.85

301.38
168.55

84.58

80.71

84.58

80.71

95.29
346.66

128.95
161.86

95.29
346.66

128.95
161.86

24.48

98.16

11.60

31.35

9.04

14.27

9.47

8.07

159.14

79.37

1 603.86

1 278.01

339.76

341.00

836.58

791.15

21.68

19.29

6.53
201.28
210.61

2.21
301.38
168.48

83.02

80.71

95.29
346.66

128.95
159.59

Other cooperation actions and ad-hoc programmes

29.28

29.25

26.52

26.47

2.75

2.78

3.01

3.04

Policy strategy and coordination for Development 
and relations with ACP States policy area

17.20

20.00

9.60

9.94

7.60

10.06

17.15

20.00

4

4
4

4

4

4 22 - ELARG Management of the Instrument for Pre-Accession

868.18

1 551.18

868.18

1 551.18

867.94

914.71

4

4 23 - ECHO

Information and communication strategy
Humanitarian aid including aid to uprooted 
people, food aid and disaster preparedness

11.80

5.39

731.43

731.30

11.80

5.39

7.00

0.98

731.43

731.30

713.34

707.60

4+5 Administrative expenditure of External assistance (*)

462.72

427.61

316.76

300.62

145.96

126.99

451.05

420.32

TOTAL

6 988.76

7 822.76

4 407.91

3 938.83

2 580.85

3 883.92

6 516.75

5 678.77

(*) Includes administrative cost of EDF management charged to heading 5. 

     Total ODA (Budget + EDF) administrative cost (from headings 4 & 5 and EDF adm. envelope) shown in tables 6.11 & 6.12

Breakdown by budget line of external aid financed on the General Commission Budget in 2007. (Amount in € Million)

EN 

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Fig.6.4. European Development Fund (EDF) in 2007

Instruments (1)

Commitments (2)

Payments (3) Commitments (2) Payments (3)

Of Which ODA

6th, 7th, 8th EDF

National + regional indicative programmes (NIP/RIP)
Interest-rate Subsidies
Emergency Aid
Aid for Refugees
Risk Capital
Stabex
SYSMIN
Structural Adjustment Facility
Transferred Funds (prior to 6th EDF)
Use of interests
Total

9th EDF & Transitional measures

Envelope A
Envelope B
Regional Project
Intra ACP Project
Implementation expenditure + Congo Rep. Dem.
Studies + tech. Assist. to Overseas Countries and Territories
Transferred Funds ( 6th EDF)
Peace facility (Voluntary contributions)
Other
Total

Total EDF

-
-
-
-
-

-
-
-
-

6 

6 

1 981 
296 
252 
946 
49 

-
-

39 
67 
3 630 

3 636 

388 
1 

-

2 
58 
98 
23 
0 
0 

-
572 

1 642 
217 
136 
235 
38 
1 
7 
29 
43 
2 348 

2 920 

-
-
-
-
-

-
-
-
-

6 

6 

1 927 
292 
250 
838 
49 

-
-
-

67 
3 424 

3 430 

387 
1 

-

2 
58 
98 
22 
0 
0 

-
569 

1 624 
217 
136 
178 
38 
1 
7 

-

43 
2 244 

2 814 

Breakdown by instrument of development assistance financed on the European Development Fund (EDF) in 2007. (Amount 
in € Million)

(1) Except The Investment Facility (9th EDF) managed by the EIB

(2) Commitments 2007 have been calculated following DAC procedures :

 Total commitments made in 2007 reduced by decommitments made on projects committed in 2007

(3) Before recoveries

EN 

151 

   EN 

 
                
               
 
                
               
 
                
                   
 
                
                   
 
                
 
                
 
                
 
                
 
                
                   
 
                
                   
 
                
                 
 
                
                 
                   
                 
                   
                 
 
                
                 
 
                
                 
 
                
                   
 
                
                   
 
                
                   
 
                
                   
 
                
 
                
 
                
 
                
                   
               
                   
               
            
            
            
            
               
               
               
               
               
               
               
               
               
               
               
               
                 
                 
                 
                 
 
                
                   
 
                
                   
 
                
                   
 
                
                   
                 
                 
 
                
 
                
                 
                 
                 
                 
            
            
            
            
            
            
            
            
 
Fig.6.5. Proportion of  External Assistance used for Development Aid (ODA and OA).

-

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

5 000

Budget EuropeAId

EDF

Budget Non EuropeAId

ODA OA non ODA/OA

Commitments ( € Million )

Budget EuropeAId

EDF

Budget Non EuropeAId

Total

ODA

4 300 

3 430 

2 217 

9 947 

OA

non ODA/OA

Total

66 

59 

19 

144 

42 

147 

345 

534 

4 408 

3 636 

2 581 

10 625 

EN 

152 

   EN 

        
             
             
        
        
             
           
        
        
             
           
        
        
           
           
      
 
Fig.6.6. Relation between ODA and OA in the Development Aid of the EC in 2007.

Official Aid (OA), 144 
M€, 1%

Commitments ( € Million )

Official Development 
Assistance (ODA), 9 
947 M€, 99%

( € Million )

Grand total 

Managed by EuropeAid Managed by Other DG's

Commitments

Payments Commitments

Payments Commitments

Payments

Official Development Assistance (ODA)

9 947 

8 493 

7 730 

6 572 

2 217 

1 921 

9 947 M€

Official Aid (OA)

144 

1 441 

125 

147 

19 

1 294 

144 M€

EN 

153 

   EN 

     
     
     
     
     
     
        
     
        
        
          
     
 
Fig.6.7. Regional distribution of aid to developing countries (ODA) in 2007.

ODA Multilateral Aid,Total, 
430 M€, 4%

Europe, 1 566 M€, 16%

Developing countries 
unallocated, 1 575 M€, 
16%

Oceania, 141 M€, 1%

America, 820 M€, 8%

Asia : South & Central, 
Far East, 984 M€, 10%

Asia : Middle East, 743 
M€, 7%

Africa, North of Sahara, 
521 M€, 5%

Africa, South of Sahara, 3 
166 M€, 33%

Commitments ( € Million )

( € Million )
Region

Europe
Africa, North of Sahara
Africa, South of Sahara
Asia : Middle East
Asia : South & Central,  Far East
America
Oceania
Developing countries unallocated
ODA Multilateral Aid,Total
TOTAL ODA

Grand total 

Payments Commitments

Commitments
1 566 
521 
3 166 
743 
984 
820 
141 
1 575 
430 
9 947 

1 062 
692 
3 087 
574 
922 
776 
52 
856 
472 
8 493 

Managed by EuropeAid Managed by Other DG's
Payments
Payments Commitments
939 
12 
399 
107 
140 
52 
1 
239 
32 
1 921 

1 221 
9 
418 
124 
125 
60 
1 
233 
27 
2 217 

345 
512 
2 748 
619 
859 
760 
141 
1 342 
403 
7 730 

123 
680 
2 688 
467 
782 
724 
51 
617 
440 
6 572 

(1) Following OECD region. 
Cfr next table "Country breakdown of EC Development Aid (ODA and OA) in 2007".

EN 

154 

   EN 

     
     
        
        
     
        
        
        
        
        
            
          
     
     
     
     
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
          
          
        
          
        
          
            
            
     
        
     
        
        
        
        
        
        
        
          
          
     
     
     
     
     
     
 
Fig.6.8. Regional distribution of aid to developing countries (ODA) 2003-2007.

Commitments ( € Million )

Europe
Africa

North Of Sahara
South Of Sahara
Regional

America

Asia

North & Central
South
Regional

Middle East
South & Central
Far East
Regional

Oceania
Developing countries unallocated
ODA Multilateral Aid,Total
TOTAL ODA

Payments ( € Million )

Europe
Africa

North Of Sahara
South Of Sahara
Regional

America

Asia

North & Central
South
Regional

Middle East
South & Central
Far East
Regional

Oceania
Developing countries unallocated
ODA Multilateral Aid,Total
TOTAL ODA

2003
835 
3 439 
417 
3 019 
3 
692 
419 
257 
16 
1 304 
466 
584 
196 
57 
60 
1 042 
897 
8 269 

2003
640 
2 645 
346 
2 299 
1 
502 
228 
210 
64 
1 126 
409 
463 
202 
52 
40 
777 
602 
6 331 

2004
996 
2 910 
480 
2 428 
2 
609 
317 
230 
63 
1 357 
398 
517 
391 
52 
52 
1 172 
441 
7 538 

2004
733 
2 916 
558 
2 357 
2 
535 
308 
152 
75 
1 302 
511 
526 
210 
55 
54 
876 
510 
6 926 

2005
1 144 
4 143 
503 
3 640 
1 
605 
331 
211 
62 
1 641 
420 
858 
214 
149 
87 
1 189 
479 
9 287 

2005
780 
3 161 
559 
2 602 
0 
645 
305 
233 
107 
1 484 
420 
661 
257 
147 
73 
846 
508 
7 497 

2006
1 532 
3 806 
543 
2 867 
396 
759 
505 
214 
40 
1 852 
587 
831 
347 
88 
32 
1 245 
605 
9 832 

2006
1 069 
3 341 
658 
2 683 
0 
666 
365 
246 
56 
1 596 
494 
699 
295 
108 
64 
790 
602 
8 130 

2007
1 566 
3 687 
521 
3 113 
53 
820 
387 
334 
100 
1 728 
743 
739 
164 
81 
141 
1 575 
430 
9 947 

2007
1 062 
3 779 
692 
3 024 
63 
776 
454 
275 
47 
1 496 
574 
604 
263 
55 
52 
856 
472 
8 493 

Bilateral and Multilateral ODA flows.
(1) Following OECD region. 
Cfr next table "Country breakdown of EC Development Aid (ODA and OA) in 2007".

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Fig.6.9. Country breakdown of EC Development Aid (ODA and OA) in 2007.

( € Million )

Country/Region

Managed by EuropeAid Managed by Other DG's
Commitments Payments Commitments Payments Commitments Payments

Total

Part I: Developing Countries & 
Territories 

Europe, Total
Albania
Belarus
Bosnia-Herzegovina
Croatia
Macedonia (fYRoM)
Moldova
Montenegro
Serbia
Turkey
Ukraine
States of ex-Yugoslavia unspecif.
Europe, Regional

Africa, Total

North Of Sahara, Total

Algeria
Egypt
Libya
Morocco
Tunisia
North Of Sahara, Regional

South Of Sahara, Total

Angola
Benin
Botswana
Burkina Faso
Burundi
Cameroon
Cape Verde
Central African Rep.
Chad
Comoros
Congo, Dem. Rep.
Congo, Rep.
Cote d'Ivoire
Djibouti
Equatorial Guinea
Eritrea
Ethiopia
Gabon
Gambia
Ghana
Guinea
Guinea-Bissau
Kenya
Lesotho
Liberia
Madagascar
Malawi
Mali
Mauritania
Mauritius
Mayotte

1 566.00
50.48
10.00
57.31
105.59
47.28
88.06
23.92
240.46
481.52
166.59
7.35
287.43
3 686.76
521.11
63.78
139.04
2.00
190.06
103.03
23.20
3 112.98
19.10
72.11
3.65
43.08
82.26
36.22
9.72
36.55
96.72
3.92
137.87
23.64
29.72
21.90
4.38
57.82
220.38
5.60
9.01
109.35
87.55
49.25
90.93
44.24
59.92
84.48
38.41
37.91
23.76
80.74
20.53

156 

1 061.96
36.75
5.04
50.61
73.68
46.19
48.40
23.06
198.03
401.25
65.01
2.25
111.69
3 778.57
691.89
62.98
161.19
0.82
225.34
98.10
143.45
3 023.71
47.38
59.83
25.36
145.20
88.91
55.97
11.92
21.91
56.47
9.89
115.43
27.40
51.26
4.13
1.52
26.73
244.39
9.51
6.72
62.44
23.66
32.82
100.06
13.42
28.83
125.50
56.21
130.71
60.29
20.54
0.43

345.28

10.00

40.00

166.20

129.08
3 259.79
512.20
57.00
137.00
2.00
190.00
103.00
23.20
2 694.91
19.03
72.10
3.65
36.02
62.64
36.21
9.72
33.55
53.62
3.92
79.76
23.64
29.21
21.90
4.38
51.81
196.95
5.59
9.01
108.66
84.15
48.63
81.23
41.29
43.30
79.48
38.37
34.90
19.61
75.87
20.53

123.11
1.53
5.02
1.52
0.25
0.16
25.92

0.79
1.98
64.51
2.14
19.28
3 367.54
679.74
52.23
160.35
0.42
225.30
98.09
143.35
2 624.91
46.73
59.83
25.35
140.02
69.67
55.90
11.92
19.38
24.38
9.89
61.88
26.77
49.49
4.13
1.52
19.40
225.61
9.50
6.72
61.87
19.94
32.33
87.26
11.00
10.59
121.31
55.88
129.13
57.82
18.00
0.43

1 220.71
50.48

57.31
105.59
47.28
48.06
23.92
240.46
481.52
0.39
7.35
158.35
426.97
8.90
6.78
2.04

0.06
0.03

418.07
0.08
0.01
0.01
7.06
19.62
0.02
0.00
3.00
43.10

58.11

0.51

6.01
23.43
0.01

0.69
3.40
0.61
9.70
2.95
16.62
5.01
0.03
3.01
4.16
4.87

938.86
35.22
0.01
49.09
73.44
46.03
22.48
23.06
197.24
399.27
0.50
0.10
92.42
411.03
12.14
10.76
0.84
0.39
0.04
0.01
0.10
398.81
0.65
0.01
0.01
5.17
19.25
0.08

2.53
32.09

53.55
0.63
1.77

7.33
18.78
0.01

0.57
3.72
0.49
12.80
2.42
18.24
4.19
0.33
1.58
2.47
2.54

   EN 

EN 

 
Mozambique
Namibia
Niger
Nigeria
Rwanda
St.Helena
Sao Tome & Principe
Senegal
Seychelles
Sierra Leone
Somalia
South Africa
Sudan
Swaziland
Tanzania
Togo
Uganda
Zambia
Zimbabwe
South Of Sahara, Regional

Africa, Regional

America, Total

North & Central, Total

Anguilla
Antigua & Barbuda
Barbados
Belize
Costa Rica
Cuba
Dominica
Dominican Republic
El Salvador
Grenada
Guatemala
Haiti
Honduras
Jamaica
Mexico
Montserrat
Nicaragua
Panama
St.Kitts-Nevis
St.Lucia
St.Vincent & Grenadines
Trinidad & Tobago
Turks & Caicos Islands
West Indies, Regional
N. & C. America, Regional

South, Total
Argentina
Bolivia
Brazil
Chile
Colombia
Ecuador
Guyana
Paraguay
Peru
Suriname
Uruguay
Venezuela
South America, Regional

America, Regional

112.95
14.11
24.94
123.24
55.12
2.20
5.45
72.67
0.09
54.36
62.18
154.02
158.04
22.91
60.21
64.63
59.64
41.80
68.80
314.88
52.68
820.38
386.69
3.95
0.50
11.15
8.31
0.05
0.03
18.42
14.23
0.45
11.59
14.64
79.45
9.89
58.27
6.33
6.57
26.12
0.01
13.06
8.16
15.53
6.30
4.00
1.55
68.13
333.69
12.91
45.47
2.10
25.45
29.15
20.45
64.28
1.71
28.57
8.75
20.03
8.78
66.05
100.00

157 

170.81
20.53
83.72
57.66
58.27
2.50
2.85
63.74
0.88
52.62
57.43
105.67
186.04
9.15
141.61
22.70
92.85
60.19
44.54
125.12
62.96
776.10
454.39

1.92
4.45
3.89
5.78
1.53
10.53
76.14
18.38
0.86
22.47
71.44
30.18
34.92
7.96
2.60
64.17
2.16
0.68
3.23
10.33
9.01
8.91
18.45
44.41
274.59
4.46
32.04
18.76
9.14
53.89
25.50
12.72
16.80
47.63
16.11
6.74
13.49
17.32
47.13

108.93
14.10
18.78
122.90
55.06
2.20
5.45
72.00
0.09
54.35
44.88
154.00
51.98
20.03
48.07
63.43
31.31
41.79
42.75
314.08
52.68
760.40
365.93
3.95
0.50
11.13
8.00

18.42
10.00

11.59
14.60
72.52
9.00
58.24
6.27
6.57
19.30

13.06
8.16
15.53
6.30
4.00
1.55
67.24
294.47
12.70
41.38
2.00
25.42
10.40
18.90
63.92
0.03
17.00
8.55
20.00
8.14
66.05
100.00

166.15
20.53
77.71
57.39
57.51
2.50
2.85
61.48
0.88
51.63
40.74
105.66
68.03
6.79
128.12
21.27
72.14
60.13
25.78
124.01
62.89
723.73
436.24

1.92
4.44
3.74
5.68
1.45
10.53
73.68
17.05
0.62
21.18
69.73
28.47
34.90
7.89
2.60
56.83
2.07
0.68
3.23
10.33
9.01
8.52
18.45
43.25
240.41
4.18
29.75
18.63
9.12
36.79
24.31
12.34
15.45
38.68
15.94
6.71
13.02
15.50
47.08

4.02
0.01
6.16
0.34
0.06

4.66
0.01
6.01
0.28
0.77

0.67

2.26

0.01
17.30
0.02
106.06
2.88
12.14
1.20
28.33
0.02
26.05
0.79

59.98
20.75

0.01
0.31
0.05
0.03

4.23
0.45

0.04
6.94
0.89
0.02
0.05

6.82
0.01

0.00

0.89
39.22
0.21
4.09
0.10
0.03
18.75
1.55
0.36
1.68
11.57
0.21
0.03
0.64

0.99
16.69
0.01
118.02
2.36
13.49
1.43
20.71
0.06
18.76
1.11
0.08
52.37
18.15

0.01
0.15
0.10
0.08

2.46
1.32
0.24
1.29
1.71
1.71
0.02
0.07

7.34
0.09

0.00
0.40

1.15
34.17
0.28
2.29
0.12
0.02
17.10
1.19
0.39
1.35
8.95
0.17
0.03
0.47
1.82
0.05  

   EN 

EN 

Asia, Total

Middle East, Total

Bahrain
Iran
Iraq
Jordan
Lebanon
Oman
Palestinian Admin. Areas
Saudi Arabia
Syria
Yemen
Middle East, Regional
South & Centr. Asia, Total

Afghanistan
Armenia
Azerbaijan
Bangladesh
Bhutan
Georgia
India
Kazakhstan
Kyrgyz Rep.
Maldives
Myanmar (Burma)
Nepal
Pakistan
Sri Lanka
Tajikistan
Turkmenistan
Uzbekistan
Central Asia, Regional
South Asia, Regional
South & Central Asia, Regional

Far East, Total
Cambodia
China
Indonesia
Korea, Dem.
Laos
Malaysia
Mongolia
Philippines
Thailand
Timor-Leste
Viet Nam
Far East Asia, Regional

Asia, Regional

1 727.55
743.37

1 495.93
573.98

1 478.61
619.32

1 249.14
466.92

248.94
124.05

246.79
107.07

7.14
21.80
90.88
74.96

467.70

34.03
21.50
25.36
739.09
195.84
31.55
20.35
89.16
0.06
29.86
144.94
19.09
13.60

45.60
40.69
33.18
18.43
23.02
6.00
0.10
20.03
7.60

163.65
23.88
8.33
13.84
10.00
10.42
0.01
10.00
15.21
14.88
21.34
35.09
0.65
81.45

7.33
17.87
49.19
56.30

389.95
0.01
34.71
12.96
5.67
603.96
224.60
14.98
6.60
74.11
2.62
20.49
65.47
6.89
14.52
5.36
14.36
18.05
49.57
39.34
11.65
1.80
7.57
21.88
0.00
4.08
263.14
32.76
40.91
40.85
12.13
6.51
0.28
1.63
25.12
22.08
28.91
49.46
2.49
54.86

14.00
88.68
47.08

0.64
14.65
47.63
32.23

7.14
7.80
2.20
27.88

394.76

323.68

72.94

29.00
20.50
25.30
630.25
180.30
31.29
19.00
70.50

27.09
129.50
19.00
13.60

26.02
29.00
25.67
4.00
23.01
6.00
0.10
18.90
7.29

147.59
23.85
7.50
12.00
8.00
10.40

10.00
13.00
11.50
18.34
33.00

81.45

31.57
10.84
5.67
518.68
211.37
14.90
5.38
65.76
2.62
17.92
56.07
6.70
13.42
5.30
8.42
6.92
38.14
24.55
7.61
1.52
6.98
21.88

3.23
214.88
31.17
40.50
34.42
1.49
5.91
0.27
1.28
20.61
7.10
23.46
46.18
2.49
48.67

5.03
1.00
0.07
108.84
15.54
0.27
1.35
18.66
0.06
2.78
15.44
0.09

19.57
11.69
7.51
14.43
0.01

1.13
0.31

16.06
0.03
0.83
1.84
2.00
0.02
0.01

2.21
3.38
3.00
2.09
0.65
0.00

6.70
3.22
1.55
24.06

66.26
0.01
3.15
2.12

85.28
13.24
0.09
1.22
8.35

2.57
9.40
0.19
1.11
0.06
5.93
11.13
11.43
14.78
4.05
0.28
0.59

0.00
0.85
48.26
1.59
0.40
6.43
10.64
0.61
0.01
0.35
4.51
14.98
5.45
3.28

6.19  

EN 

158 

   EN 

Oceania, Total

Cook Islands
Fiji
Kiribati
Marshall Islands
Micronesia, Fed. Sts.
Nauru
Niue
Palau
Papua New Guinea
Samoa
Solomon Islands
Tokelau
Tonga
Tuvalu
Vanuatu
Wallis & Futuna
Oceania, Regional

LDC's Unspecified

Part I (ODA) Bilateral, Total

Public Private Partnerships
United Nations
UNRWA
UNDP
WFP
WHO
FAO

World Bank Group
Regional Development Banks
Other Multilateral Institutions

GFTAM

Others

Part I (ODA) Multilateral Aid,Total

141.49
1.00
2.77
2.20
1.80
2.12
0.77

0.90
49.74
2.24
13.94

3.42
0.70
5.16
16.32
38.42
1 574.83
9 517.01

174.49
66.00
37.00

14.61
98.00
10.00
146.26
100.00
1.50
430.24

52.24
0.27
7.87
2.81
1.03
0.50
0.18
0.35
0.24
17.62
1.83
2.35

0.19
1.03
3.71
0.08
12.16
855.94
8 020.75

1.54
229.21
65.92
25.00
85.51
2.78
6.83
114.72
18.98
106.04
62.00
1.49
471.97

140.78
1.00
2.75
2.20
1.80
2.12
0.77

0.90
49.71
2.24
13.38

3.42
0.70
5.05
16.32
38.42
1 342.14
7 327.01

150.08
66.00
35.00

14.58
98.00
10.00
145.00
100.00

51.42
0.27
7.78
2.61
1.03
0.50
0.18
0.35
0.24
17.62
1.83
1.91

0.19
1.03
3.63
0.08
12.16
616.58
6 131.53

1.54
200.17
65.92
25.00
85.51
2.78
6.79
114.72
18.98
104.75
62.00

403.08

440.16

0.71

0.02

0.02

0.55

0.82

0.09
0.20

0.01

0.44

0.11

0.09

0.00
232.68
2 190.00

0.00
239.36
1 889.22

24.41

29.03

2.00

0.03

0.04

1.26

1.29

1.50
27.16

1.49
31.81

Part I (ODA), Total

9 947.25

8 492.72

7 730.08

6 571.69

2 217.17

1 921.04

EN 

159 

   EN 

 
Part II: Countries and Territories in 
Transition - Official Aid (OA) 

More Advanced Developing Countries

Aruba
Bahamas
Bermuda
Brunei
Cayman Islands
Chinese Taipei (Taiwan)
Cyprus
Falkland Islands
French Polynesia
Gibraltar
Hong Kong, China
Israel
Korea
Kuwait
Macao
Malta
Netherlands Antilles
New Caledonia
Northern Marianas
Qatar
Singapore
Slovenia
United Arab Emirates
Virgin Islands (UK)
MADCT Unallocated

CEEC's/NIS

Bulgaria
Czech Republic
Estonia
Hungary
Latvia
Lithuania
Poland
Romania
Russia
Slovak Republic
CEEC's Unallocated
NIS Unallocated
CEEC's/NIS Unallocated
Part II (OA) Bilateral Aid, Total

EBRD

Part II (OA) Multilateral Aid, Total

61.03
1.43
1.87

28.14
3.94
0.14

3.30
0.03

1.50

2.01
0.06

43.61

0.09

1.00
6.13
82.69

80.92

1.77

143.72

0.04
0.25
1.51
2.29

0.02
0.93
0.03

1.73
1.70
5.23

0.09
5.11

5.13
1 410.20
238.61
15.08
6.12
53.30
20.68
25.41
226.81
579.85
126.82
5.63
82.92
20.97
8.00
1 438.34

3.04
3.04

60.66
1.43
1.69

3.30

1.50

20.67
3.94

1.51
2.29

2.00

0.87

43.61

1.70
5.23

1.00
6.13
64.27

62.74

1.53

124.93

5.13
126.47
0.05

0.04

102.89
0.01
1.51
20.97
1.00
147.14

0.37

0.18

0.03

0.01
0.06

0.09

18.42

18.18

0.24

18.78

7.47

0.14

0.04
0.25

0.02
0.06
0.03

1.73

0.09
5.11

1 283.73
238.57
15.08
6.12
53.30
20.68
25.41
226.77
579.85
23.93
5.62
81.41

7.00
1 291.20

3.04
3.04

Part II (OA), Total

143.72

1 441.38

124.93

147.14

18.78

1 294.24

Grand Total Part I & Part II (ODA+OA)

10 090.97

9 934.10

7 855.02

6 718.83

2 235.95

3 215.27

Breakdown by country/region of external aid financed on the General Commission Budget and the European 
Development Fund (EDF) in 2007.
Bilateral and Multilateral ODA / OA flows.

EN 

160 

   EN 

 
Fig.6.10. Sectoral breakdown of ODA managed by the EC in 2007.

9. Other/Unallocated : 
Admin. Costs, Support to 
NGOs, Unspecified, 608 
M€, 6.1%

7. Humanitarian Aid, 1 064 
M€, 10.7%

6. Action relating to debt, 
23 M€, 0.2%

5. Budget Support, Food 
Aid, Food Security, 988 M€, 
9.9%

4. Multisector/Crosscutting 
: Environment, Other, 873 
M€, 8.8%

1. Social Infrastructures: 
Education, Health, Water, 
Government & Civil 
Society, Other , 4 263 M€, 
42.9%

3. Production : Agriculture, 
Forestry & Fishing, 
Industry, Mining & 
Construction, Trade & 
Tourism, 718 M€, 7.2%

2. Economic Infrastructures 
& Services : Transport, 
Communications, Energy, 
Other services, 1 411 M€, 
14.2%

Commitments in € Million

EN 

161 

   EN 

 
Fig.6.11. Detailed description of ODA by sector in 2007 - Commitments.

Commitments ( € Million )

Sector of Destination

SOCIAL INFRASTRUCTURE AND SERVICES

Education

Education, level unspecified
Basic education
Secondary education
Post-secondary education

Health

Health, general
Basic health

Population polices/programs and reproductive health
Water supply and sanitation
Government and civil society
Other Social Infrastructure

ECONOMIC INFRASTRUCTURE AND SERVICES

Transport and storage
Communications
Energy generation and supply
Banking and financial services
Business and other services

PRODUCTION SECTORS

Agriculture, Forestry and Fishing

Agriculture
Forestry
Fishing

Industry, Mining and Construction

Industry
Mineral resources and mining
Construction
Trade and Tourism

Trade policy and regulation
Tourism

MULTISECTOR/CROSSCUTTING

General environmental protection
Other multisector

COMMODITY AID AND GENERAL PROGRAMME ASSISTANCE

General budget support
Development food aid/food security assistance
Other commodity assistance

ACTION RELATING TO DEBT
Action relating to debt

HUMANITARIAN AID

Emergency Response
Reconstruction relief and rehabilitation
Disaster prevention and preparedness

OTHER/UNALLOCATED/UNSPECIFIED
Administrative costs of donors
Support to non-governmental organisations
Unallocated/unspecified

GRAND TOTAL

Total

Managed by 
EuropeAid

Managed by 
Other DG's

4 262.58
595.63
250.61
102.03
66.42
176.57
430.42
73.17
357.25
65.42
337.65
1 952.71
880.76
1 410.96
706.95
55.83
393.75
35.05
219.39
717.86
340.87
279.81
16.00
45.07
167.01
167.01

209.97
194.67
15.30
873.36
263.26
610.11
987.52
715.97
271.56

22.82
22.82
1 064.22
832.59
160.35
71.28
607.92
501.54
0.75
105.63
9 947.25

3 561.95
496.62
209.21
97.27
52.42
137.72
422.62
65.37
357.25
63.04
308.15
1 497.01
774.50
1 124.92
575.35
50.50
334.46
28.00
136.62
661.18
309.31
256.70
16.00
36.61
150.53
150.53

201.34
187.04
14.30
674.05
149.01
525.04
906.02
658.47
247.56

22.82
22.82
356.58
144.77
159.85
51.96
422.56
365.73
0.75
56.09
7 730.08

700.64
99.01
41.40
4.76
14.00
38.85
7.80
7.80

2.38
29.50
455.70
106.26
286.04
131.60
5.33
59.29
7.05
82.77
56.68
31.56
23.11

8.46
16.49
16.49

8.63
7.63
1.00
199.31
114.25
85.07
81.50
57.50
24.00

707.64
687.82
0.50
19.32
185.35
135.81

49.54
2 217.17

Breakdown by sector of Official Development Assistance (ODA) financed on the General Commission Budget and 
the European Development Fund (EDF) in 2007.
Bilateral and Multilateral ODA flows.

EN 

162 

   EN 

 
Fig.6.12. Detailed description of ODA by sector in 2007. - Payments.

Payments ( € Million )

Sector of Destination

SOCIAL INFRASTRUCTURE AND SERVICES

Education

Education, level unspecified
Basic education
Secondary education
Post-secondary education

Health

Health, general
Basic health

Population polices/programs and reproductive health
Water supply and sanitation
Government and civil society
Other Social Infrastructure

ECONOMIC INFRASTRUCTURE AND SERVICES

Transport and storage
Communications
Energy generation and supply
Banking and financial services
Business and other services

PRODUCTION SECTORS

Agriculture, Forestry and Fishing

Agriculture
Forestry
Fishing

Industry, Mining and Construction

Industry
Mineral resources and mining
Construction
Trade and Tourism

Trade policy and regulation
Tourism

MULTISECTOR/CROSSCUTTING

General environmental protection
Other multisector

COMMODITY AID AND GENERAL PROGRAMME ASSISTANCE

General budget support
Development food aid/food security assistance
Other commodity assistance

ACTION RELATING TO DEBT
Action relating to debt

HUMANITARIAN AID

Emergency Response
Reconstruction relief and rehabilitation
Disaster prevention and preparedness

OTHER/UNALLOCATED/UNSPECIFIED
Administrative costs of donors
Support to non-governmental organisations
Unallocated/unspecified

GRAND TOTAL

Total

Managed by 
EuropeAid

Managed by 
Other DG's

3 439.82
546.31
116.12
157.17
100.61
172.41
446.83
49.90
396.93
101.60
266.62
1 321.59
756.88
1 209.49
805.65
32.76
202.98
54.52
113.58
635.35
289.08
230.51
40.21
18.36
177.08
134.82
42.17
0.09
169.20
158.39
10.80
620.42
165.57
454.85
962.39
689.66
272.73

1 080.48
848.25
214.79
17.44
544.76
481.56
0.37
62.84
8 492.72

2 712.83
440.53
95.74
112.19
77.94
154.65
377.28
48.44
328.84
87.36
256.77
831.38
719.51
1 092.96
788.85
28.15
142.81
54.02
79.13
597.89
273.04
219.70
40.21
13.13
171.59
129.40
42.17
0.02
153.26
143.27
9.99
457.54
142.57
314.97
929.24
669.53
259.71

379.70
166.23
213.34
0.13
401.53
359.96
0.33
41.24
6 571.69

726.99
105.78
20.37
44.98
22.66
17.76
69.55
1.46
68.09
14.24
9.85
490.21
37.37
116.53
16.80
4.61
60.17
0.50
34.45
37.47
16.04
10.81

5.24
5.49
5.42

0.07
15.94
15.12
0.82
162.88
23.00
139.89
33.15
20.13
13.02

700.78
682.02
1.46
17.30
143.24
121.60
0.04
21.60
1 921.04

Breakdown by sector of Official Development Assistance (ODA) financed on the General Commission Budget and 
the European Development Fund (EDF) in 2007.
Bilateral and Multilateral ODA flows.

EN 

163 

   EN 

 
Fig.6.13. EuropeAid in 2007: A closer look. Sectoral breakdown per region.

Commitments ( € Million )

Sector of Destination

SOCIAL INFRASTRUCTURE AND SERVICES

Education

Education, level unspecified
Basic education
Secondary education
Post-secondary education

Health

Health, general
Basic health

Population polices/programs and reproductive health
Water supply and sanitation
Government and civil society
Other Social Infrastructure

ECONOMIC INFRASTRUCTURE AND SERVICES

Transport and storage
Communications
Energy generation and supply
Banking and financial services
Business and other services

PRODUCTION SECTORS

Agriculture, Forestry and Fishing

Agriculture
Forestry
Fishing

Industry, Mining and Construction

Industry
Mineral resources and mining
Construction
Trade and Tourism

Trade policy and regulation
Tourism

MULTISECTOR/CROSSCUTTING

General environmental protection
Other multisector

COMMODITY AID AND GENERAL PROGRAMME ASSISTANCE

General budget support
Development food aid/food security assistance
Other commodity assistance

ACTION RELATING TO DEBT
Action relating to debt

HUMANITARIAN AID

Emergency Response
Reconstruction relief and rehabilitation
Disaster prevention and preparedness

OTHER/UNALLOCATED/UNSPECIFIED
Administrative costs of donors
Support to non-governmental organisations
Unallocated/unspecified

GRAND TOTAL

ENPI 
East

ENPI 
South

Asia

187
55

16
39

111
21
208
16

192

6
6

6

82
1
82
6

6

4

4

38
2

978
169
120
17

32
40
40

2

252
515
76

15
61
55

40
40

15
15

81
43
38
10

10

26
4
18
4
12
0

37
532

12
1 239

489
105
48
35
5
16
167
5
162

193
25
39
24
12

3
67
12
12

25
25

30
30

33
5
28
248
173
76

68
37
31

6
0
1
5
950

Latin 
America
181
70
11
16
12
31
0

0
7
7
96
1
57

7

50
22
10
10

6
6

6
6

110
1
109
0

0

2
0

ACP

1 427
88
30
7
19
31
154
21
133
54
319
600
212
751
545
32
138
13
23
513
282
235
10
37
80
80

152
137
15
333
55
279
532
486
46

23
23
261
104
110
48
51
51

2
373

0
3 891

Multi 
Region
340
22

22

62

62

2
255

32

32

73
46
27
110

110

315
315

1
871

Total

3 603
508
209
97
52
149
423
65
357
63
328
1 507
775
1 162
584
51
363
28
137
664
309
257
16
37
151
151

204
189
15
713
150
562
906
658
248

23
23
360
145
163
52
424
367
1
56
7 855

Breakdown by sector and Region of external aid financed on the General Commission Budget managed by EuropeAid and the 
European Development Fund (EDF).
Bilateral and Multilateral ODA / OA flows.
On budget side, region is identified following geographical budget lines and recipient countries for thematic budget lines.
ENPI East : Europe + Armenia, Azerbaijan, Georgia. Russia.
ENPI South : North Of Sahara + Jordan, Lebanon, Libya, Palestinian Admin. Areas, Syria, Israel.
Asia : Iran, Iraq, Oman, Saudi Arabia, Yemen, Afghanistan, Bangladesh, Bhutan, India, Kazakhstan, Kyrgyz Rep., Maldives, Myanmar 
(Burma), Nepal, Pakistan, Sri Lanka, Tajikistan, Turkmenistan, Uzbekistan, Cambodia, China, Indonesia, Korea, Dem., Laos, Malaysia, 
Mongolia, Philippines, Thailand, Timor-Leste, Viet Nam.

Latin America : Costa Rica, Cuba, El Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Argentina, Bolivia, Brazil, Chile, 
Colombia, Ecuador, Paraguay, Peru, Uruguay, Venezuela

ACP : South Of Sahara + Oceania + Anguilla, Antigua & Barbuda, Barbados, Belize, Dominica, Dominican Republic, Grenada, Haiti, 
Jamaica, Montserrat, St.Kitts-Nevis, St.Lucia, St.Vincent & Grenadines, Trinidad & Tobago, Turks & Caicos Islands, West Indies, 
Regional, Guyana, Suriname
Multi region : covering several regions or unspecified location.

EN 

164 

   EN 

 
Fig.6.14. EuropeAid in 2007: A closer look. Sectoral breakdown per instrument.

Commitments ( € Million )

Sector of Destination

ENPI

EDF

DCI - 
Geo (1)

SOCIAL INFRASTRUCTURE AND SERVICES

Education

Education, level unspecified
Basic education
Secondary education
Post-secondary education

Health

Health, general
Basic health

Population polices/programs and reproductive health
Water supply and sanitation
Government and civil society
Other Social Infrastructure

ECONOMIC INFRASTRUCTURE AND SERVICES

Transport and storage
Communications
Energy generation and supply
Banking and financial services
Business and other services

PRODUCTION SECTORS

Agriculture, Forestry and Fishing

Agriculture
Forestry
Fishing

Industry, Mining and Construction

Industry
Mineral resources and mining
Construction
Trade and Tourism

Trade policy and regulation
Tourism

MULTISECTOR/CROSSCUTTING

General environmental protection
Other multisector

COMMODITY AID AND GENERAL PROGRAMME ASSISTANCE

General budget support
Development food aid/food security assistance
Other commodity assistance

ACTION RELATING TO DEBT
Action relating to debt

HUMANITARIAN AID

Emergency Response
Reconstruction relief and rehabilitation
Disaster prevention and preparedness

OTHER/UNALLOCATED/UNSPECIFIED
Administrative costs of donors
Support to non-governmental organisations
Unallocated/unspecified

GRAND TOTAL

1 161
224
120
17
16
71
40
40

2

359
536
207
16

115
15
61
61
6

6

40
40

15
15

150
43
107

30
4
22
4
57
38

1 247
88
30
7
19
31
154
21
133
54
209
546
196
751
545
32
138
13
23
372
181
135
10
37
43
43

148
137
11
323
55
269
462
416
46

23
23
261
104
110
48
50
50

720
171
59
51
17
44
167
5
162
7
112
226
37
93
24
19

50
112
22
22

61
61

30
30

143
6
137
173
173

68
37
31

53
47

19
1 666

3 489

7
1 362

DCI - 
Thema 
(2)

322
22

22

62
0
62

0
238

32

32

90
83
83

7
7

53
47
6
271
70
201

64
33
1
30
833

EIDHR

IFS

NSI

Other

Total

133

9

133

4
5

77

77

15

15

10
4

4

6
0

3

3
29
17
17

12
7
5
28

28
0

0

9
9

3
3

1
1

186
186

142

27

78

257

3 603
508
209
97
52
149
423
65
357
63
328
1 507
775
1 162
584
51
363
28
137
664
309
257
16
37
151
151

204
189
15
713
150
562
906
658
248

23
23
360
145
163
52
424
367
1
56
7 855

Breakdown by sector and Region of external aid financed on the General Commission Budget managed by EuropeAid and the European Development 
Fund (EDF).
Bilateral and Multilateral ODA / OA flows.
(1) DCI - Geo : Asia, Latin America, South Africa
(2) DCI - Thema : Migration, Food security, Non-state actors, Environment, Human & social development, ACP sugar programmes

EN 

165 

   EN 

 
Fig.6.15. EuropeAid in 2007: A closer look. Sectoral breakdown per instrument.

0%

20%

40%

60%

80%

100%

ENPI

EDF

DCI - Geo

DCI - Thema

EIDHR

IFS

NSI

Other

Commitments %

1. Social Infrastructures: Education, Health, Water, Government & Civil Society, Other 
2. Economic Infrastructures & Services : Transport, Communications, Energy, Other services
3. Production : Agriculture, Forestry & Fishing, Industry, Mining & Construction, Trade & Tourism
4. Multisector/Crosscutting : Environment, Other
5. Budget Support, Food Aid, Food Security
7. Emergency assistance, Reconstruction Relief
9. Other/Unallocated : Admin. Costs, Support to NGOs, Unspecified

EN 

166 

   EN 

 
Fig.6.16. 2001-2007 External Assistance.

Commitments (€ million)

13 000

12 000

11 000

10 000

9 000

8 000

7 000

6 000

5 000

4 000

3 000

2 000

1 000

0

2001

2002

2003

2004

2005

2006

2007

EuropeAid Budget

EuropeAid EDF

non EuropeAid Budget

Grand Total

Payments (€ million)

13 000

12 000

11 000

10 000

9 000

8 000

7 000

6 000

5 000

4 000

3 000

2 000

1 000

0

2001

2002

2003

2004

2005

2006

2007

EuropeAid Budget

EuropeAid EDF

non EuropeAid Budget

Grand Total

External aid financed on the General Commission Budget and the European D evelopment Fund (EDF) managed by EuropeAid. 

Source : Annual Report 2001, 2002, 2003, 2004, 2005 and 2006

Bilateral and Multilateral ODA / OA / Other flows.

EN 

167 

   EN 

 
Fig.6.17. 2001-2007 Official Development Assistance (ODA) and Official Aid (OA) by the 
EC.

Commitments (€ million)

14 000

12 000

10 000

8 000

6 000

4 000

2 000

0

2001

2002

2003

2004

2005

2006

2007

Official Development Assistance Official aid

Payments (€ million)

12 000

10 000

8 000

6 000

4 000

2 000

0

2 001

2 002

2 003

2 004

2 005

2006

2007

Official Development Assistance Official aid

External aid financed on the General Commission Budget and the European Development Fund (EDF).
Source : Annual Report 2001, 2002, 2003, 2004, 2005, 2006
Bilateral and Multilateral ODA / OA flows.

EN 

168 

   EN 

 
Fig.6.18. 2001-2007 Sectoral breakdown of Official Development Assistance (ODA).

Commitments (€ million)

12 000

10 000

8 000

6 000

4 000

2 000

0

2001 2002 2003 2004 2005 2006 2007

Bilateral and Multilateral ODA flows.

9. Other/Unallocated : Admin. Costs,
Support to NGOs, Unspecified

7. Emergency assistance,
Reconstruction Relief

6. Action relating to debt

5. Budget Support, Food Aid, Food
Security

4. Multisector/Crosscutting :
Environment, Other

3. Production : Agriculture, Forestry &
Fishing, Industry, Mining & Construction,
Trade & Tourism

2. Economic Infrastructures & Services :
Transport, Communications, Energy,
Other services

1. Social Infrastructures: Education,
Health, Water, Government & Civil
Society, Other 

EN 

169 

   EN