REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN PARLIAMENT Seventh Annual Report 2012 on the implementation of Community assistance under Council regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of financial support for encouraging the economic development of the Turkish Cypriot community
Date: 2013-06-04
Institutions: European Commission
Subjects: Cyprus, EU aid, EU programme, Türkiye, economic development, social development

EUROPEAN 
COMMISSION 

Brussels, 4.6.2013  
COM(2013) 332 final 

REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN 
PARLIAMENT 

Seventh Annual Report 2012 on the implementation of Community assistance under 
Council regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of 
financial support for encouraging the economic development of the Turkish Cypriot 
community 

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REPORT FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN 
PARLIAMENT 

Seventh Annual Report 2012 on the implementation of Community assistance under 
Council regulation (EC) No 389/2006 of 27 February 2006 establishing an instrument of 
financial support for encouraging the economic development of the Turkish Cypriot 
community 

1. 

INTRODUCTION 
Council  Regulation  (EC)  No  389/20061  (the  "Aid  Regulation")  is  the  basis  for  the 
assistance to the Turkish Cypriot community (TCc) and requires annual reporting to 
the Council and the European Parliament. This report covers the year 2012. 

2. 

PROGRAMMING OF THE ASSISTANCE 

Between  2006  and  the  end  of  2012,  €311  million  was  programmed  for  operations 
under the Aid Regulation. Development of the 2012 programme (€28 million) used 
input  from  stakeholder  consultations,  particularly  workshops  at  sector  level,  from 
external  evaluations  and  took  account  of  the  European  Court  of  Auditors  (ECA) 
Special  Report  No.  6  on  assistance  to  the  Turkish  Cypriot  community2.  The  2012 
allocation was made available under two Commission Decisions3. 

3. 

IMPLEMENTATION MECHANISMS  

The  programme  is  implemented  in  those  areas  of  the  Republic  of  Cyprus  in  which 
the Government does not exercise effective control and where the application of the 
acquis  communautaire  is  temporarily  suspended  pursuant  to  Protocol  10  of  the 
Treaty  of  Accession.  Assistance  is  implemented  primarily  through  centralised 
management by the European Commission. Some projects are jointly managed with 
the United Nations Development Programme (UNDP).  

The Commission operates in a unique political, legal and diplomatic context. Ad hoc 
arrangements  are  needed  to  implement  the  programme  while  respecting  the 
principles of sound financial management. In EU-funded aid programmes, in normal 
circumstances,  agreements with a beneficiary government would establish the legal 
framework  for  development  assistance.  No  such  agreements  can  be  made  for  the 
assistance to the TCc and the Commission has to rely on what it understands to be 
the  rules  and  conditions  applicable  locally.  This  introduces  a  certain  level  of  risk. 
Management  and  mitigation  of  this  risk  is  part  of  the  Commission's  responsibility 
and  measures  adopted  include  intensive  monitoring  and  support  to  beneficiaries, 
revised payment conditions and a more widespread use of bank guarantees. 

The TCc needs to provide sufficient priority and resources to make this programme a 
success  and  in  particular  to  ensure  its  long-term  sustainability.  They  have  to  make 
sure  that  the  EU-funded  assets  remain  in  public  hands.  Turkish  Cypriot  (TC) 
stakeholders are consulted about their needs for future funding and TC experts take 
part  in  tender  evaluations  and  play  a  key  role  in  project  steering  committees. 

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3 

OJ L65, 7.3.2006, p.5. 
http://eca.europa.eu/portal/page/portal/pressroom/Presspacks/Previouspresspacks/2012/PresspackSR62012 
Commission Decisions C(2012)4628 and C(2012)8361.  

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Cooperation  between  the  Turkish  Cypriot  and  Greek  Cypriot  communities  remains 
necessary for full effectiveness of the programme and for achieving the ultimate goal 
of reunification.  

The  Programme  Team  uses  the  EU  Programme  Support  Office  (EUPSO)  in  the 
northern part of Nicosia. The Representation of the Commission in Cyprus also hosts 
meetings and seminars and communicates to the Cypriot public on the programme as 
part of its standard role. 

Due to the specific circumstances described above, sector development programmes 
cannot easily be conceived. The assistance instead includes a significant amount of 
grant  support,  particularly  to  non-public  actors.  Management  of  these  schemes  is 
demanding in terms of the Programme Team's resources, where the staffing situation 
is  particularly  disrupted  by  a  high  turnover  rate  due  to  the  short  duration  of  staff 
contracts. 

The  challenges  of  medium  and  long-term  planning  remain,  due  to  the  current 
arrangement  of  financing  from  the  margins  of  the  EU  Budget.  This  means  that  the 
budget  is  unpredictable,  with  no  guarantee  of  annual  allocations.  In  its  Report 
mentioned  above,  the  ECA  assessed  that  this  uncertainty  makes  programme 
management  more  difficult  and,  has  a  negative  impact  on  its  effectiveness  and 
sustainability.  

4. 

IMPLEMENTATION DURING THE REPORTING PERIOD 

4.1. 

General overview 

The  ECA  concluded  that,  despite  the  difficult  political  context  and  a  compressed 
timetable,  the  Commission  managed  to  establish  a  programme  which  reflected  the 
Regulation’s  objectives,  appropriately  prioritised  all  sectors  referred  to  in  the 
Regulation's objectives, and introduced largely suitable implementation methods and 
risk  mitigation  measures.  The  ECA  also  noted  a  number  of  weaknesses  in 
programme  management,  and  considered  that  sustainability  of  projects  is  often  in 
doubt due to limited administrative capacity, the delayed adoption of relevant legal 
texts  and  the  uncertainties  over  future  funding  on  the  part  of  the  TCc.  The 
Commission  has  accepted  the  ECA's  recommendations  with  some  caveats.  The 
Council  adopted  conclusions  on  the  ECA's  Report4  in  July.  The  European 
Parliament's Committee on Budgetary Control adopted a report5 in December. 

The  part  of  the  programme  originating  from  the  large  2006  financial  allocation 
included  major  supply  and  construction  contracts  in  water/wastewater,  solid  waste, 
nature  protection,  energy  and  telecommunications  as  well  as  substantial  technical 
assistance programmes, and around 1000 grant contracts under various schemes for 
NGOs, SMEs, farmers, rural communities, schools, and students. By the end of 2012, 
many  of  these  were  completed.  Consequently,  2012  was  a  year  when  programme 
deliverables became particularly visible and benefits to the TCc materialised. Focus 
has  been  maintained  on  the  bi-communal  activities  and  confidence  building, 
particularly  with  continued  and  increased  support  to  the  Committee  on  Missing 
Persons and to the bi-communal Technical Committee on Cultural Heritage through 
joint  management  with  UNDP.  Work  also  included  preparation  for  the  full 
application  and  implementation  of  the  acquis  following  a  possible  solution  to  the 

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Cyprus  problem,  and  the  dissemination  of  information  on  the  European  Union's 
political  and  legal  order  to  the  TCc.  Four  new  grant  schemes  were  launched  in  the 
course of 2012 to provide support to rural enterprises, SMEs, schools, students and 
teachers. 

Many  contracts  (190)  were  closed  during  2012,  primarily  grants,  leaving  402 
contracts still open at the end of the year. This number will rise as the 2011 and 2012 
programmes reach full speed. The past year, with the winding down of the activities 
originating  from  2006,  was  also  the  occasion  to  launch  a  substantial  evaluation 
effort.  

The  problem  that  arose  in  2011  concerning  the  status  of  bank  guarantees  remained 
unsolved.  As  reported  last  year,  a  local  contractor  filed  a  suit  with  a  local  "court", 
rather  than  following  the  dispute  settlement  procedures  foreseen  in  the  contract, 
which  resulted  in  injunctions  preventing call-up  of  bank  guarantees  issued  by  local 
banks. In order to safeguard the EU's financial interests, the Commission will refrain 
from signing contracts of a similar nature with TC beneficiaries and contractors until 
this  issue  is  satisfactorily  solved.  Local  contractors  imposed  a  boycott  of  UNDP 
contracts affecting EU funded cultural heritage projects for a period of eight months 
over issues related to the place of jurisdiction for disputes. 

Sustainability  of  investments  is  another,  on-going  concern.  The  beneficiaries  have 
not  always  prepared  sufficiently  well  for  the  handover  of  projects,  despite 
considerable  support  from  the  EU.  The  TCc  has  struggled  to  find  resources  for 
operation  and  maintenance  of  new  infrastructure,  although  contracts  are  finally  in 
place for management of recently delivered wastewater treatment plants. 

4.2. 

Progress by objectives 

The  overall  objective  of  the  Aid  Programme  is  to  facilitate  the  reunification  of 
Cyprus  by  encouraging  the  economic  development  of  the  TCc,  with  particular 
emphasis on the economic integration of the island, on improving contacts between 
the  two  communities  and  with  the  EU,  and  on  preparation  for  the  acquis.  A 
considerable  contribution  has  been  made  towards  improvements  in  some  areas, 
notably water, wastewater and environment.  

4.2.1.  Objective 1: Developing and restructuring of infrastructure 

The  new  Morphou/Güzelyurt  wastewater  treatment  plant  was  taken  over  by  the 
beneficiary  in  January.  Plant  management  has  been  handed  over  to  an  operating 
company engaged by the local beneficiary. Once the local beneficiary has completed 
all the house connections to the sewerage network handed over in 2011, the system 
will provide, for the first time, wastewater collection and treatment in this region for 
about 10,700 people. 

Commissioning of the new wastewater treatment plant in Famagusta was underway 
at the end of the year, with the treatment process functioning and the plant producing 
clean  effluent.  Work  was  still  in  progress  on  the  sewerage  and  drinking  water 
networks (95 km total) with some delays, however, due to defective pipe connections 
causing ingress of saline water leading to corrosion problems in the treatment plant. 
The plant will serve about 30,000 people. 

The construction of the new Nicosia bi-communal wastewater treatment plant at Mia 
Milia/Haspolat,  co-funded  by  the  EU  and  the  Sewerage  Board  of  Nicosia  and 
implemented  through  the  UNDP,  continued  in  2012.  In  November,  the  sewage 
treatment  was  started  up  and  the  input  volume  is  gradually  being  increased. 

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Completion  and  take-over  of  the  works  is  foreseen  for  the  first  half  of  2013.  The 
plant will serve about 270,000 people. 

The  water/wastewater  capacity  building  programme  ended  in  December  with  a 
concluding  workshop.  Outputs  of  the  project  included  inter  alia  the  preparation  of 
legal  texts  aligned  with  the  EU  acquis,  awareness  raising,  asset  management 
planning, and training in analytical techniques.  

On  nature  protection,  no  progress  has  been  possible  on  the  unfinished  information 
and  management  centres  in  four  Special  Environmental  Protection  Areas  (SEPAs). 
Following a contract termination in 2011, the Turkish Cypriot contractor filed a suit 
with  the  local “court” to prevent the  Commission from calling  the guarantees  from 
the  local  bank.  Projects  initiated  by  the  TCc,  for  example  road  widening  project  in 
the Karpasia/Karpaz peninsula or extensive quarrying in the Kyrenia mountains raise 
concerns about the implementation by the TCc of its own management plans for the 
SEPAs, which were prepared with EU assistance. 

In the area of solid waste, the new Koutsoventis/Güngör landfill, Famagusta transfer 
station  and  related  waste  handling  equipment  were  handed  over  in  March. 
Management  of  the  landfill  passed  to  an  operating  company  engaged  by  the 
beneficiary.  The  Kato  Dhikomo/Aşağı  Dikmen  dump,  after  rehabilitation  and 
closure, was handed over in October. The solid waste management capacity building 
project finished in December.  

In  the  energy  sector,  the  main  action  was  the  integration  of  the  1.27  MW  Solar 
Power  Plant,  fully  operational  since  November  2011,  with  the  control  system  for 
remote  monitoring.  However,  the  allocation  of  dedicated  staff  by  the  beneficiary  is 
still missing for the effective and sustainable use of some of the equipment supplied, 
for instance in the case of the customer care call centre. 

All "next generation network" telecommunications equipment has been installed. The 
testing  phase  has,  however,  required  further  capacity  building  of  the  operator  and 
several  outstanding  issues  still  have  to  be  addressed  by  the  supplier  and  the 
beneficiary.  Legal  texts  detailing  the  modalities  of  liberalisation  of  the  electronic 
communications  sector  were  adopted  in  December  2011,  but  the  conditions 
necessary  to  separate  the  provision  of  services  from  the  network  operation  are  still 
missing. 

Under the traffic safety project, almost all contracts are now closed. The remaining 
component  to  eliminate  traffic  accident  “black  spots”  was  completed  in  the  third 
quarter of 2012. Potential further actions in this sector will depend on a clear policy 
decision from the beneficiary 

4.2.2.  Objective 2: Promoting social and economic development 

Aid  was  given  to  farmers,  veterinarians  and  rural  development  stakeholders  on 
animal husbandry and disease eradication, plant health, crop diversification, organic 
farming  and  support  for  grant  implementation.  The  Animal  Husbandry  Project  and 
the Technical Assistance team supporting the Rural Development Policy completed 
their activities. A pilot project for the agricultural reuse of treated sewage water was 
carried out and pilot epidemiological surveillance was initiated for diseases in cattle, 
sheep  and  goats  in  order  to  prepare  for  a  larger  intervention  in  animal  disease 
eradication. 

A  new  rural  development  €3.3  million  grant  call  for  "Increasing  Competitiveness, 
Diversification  and  Sustainability"  was  launched.  Ten  grant  projects  from  the  2009 

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scheme "Community Development through Village Initiatives" were completed, but 
a number of others suffered delays, arising, in particular, from infrastructure works 
through the grant contracts. 

Under  the  project  Upgrading  of  Urban  and  Local  Infrastructure  implemented 
through  joint  management  with  UNDP,  the  renovation  of  the  old  market  in  the 
northern  part  of  the  walled  city  of  Nicosia  was  completed  early  in  2012  and  the 
market  was  opened  by  Commissioner  Füle  in  June.  In  order  to  revitalise  this 
historical  location,  small  grants,  awarded  through  UNDP,  were  implemented  for 
cultural  and  community  activities.  A  second  grant  call  was  launched  in  December, 
targeting  the  market  in  Famagusta  and  Nicosia  as  well  as  villages,  where  EU-
financed renovations have been carried out. 

In  the  education  sector,  a  €700,000  call:  School  Initiatives  for  Innovation  and 
Change was launched in September. Seven of the 72 grants awarded under previous 
calls continued into 2012 and at year's end, five of these were close to completion. 

The  TA  programme  developing  vocational  education  training  and  labour  market 
(VETLAM) finished during 2012 and a study was conducted to assess future needs 
in these areas. 

Supporting SME Competitiveness, a €5 million grant scheme was launched in June to 
aid  SME  modernisation,  with  a  component  for  start-ups.  Training  sessions  on  EU 
grant  procedures  were  given  to  over  300  TC  enterprises.  Help  was  also  given  on 
entrepreneurship,  ICT,  company 
law  and  business  management.  A  Project 
Management  Unit  (PMU)  has  been  set  up  to  support  beneficiaries  both  of  SME 
grants  and  of  rural  development  grants  (see  above).  The  Nicosia  and  Famagusta 
downtown market initiatives have started to promote local products and services with 
modern approaches to marketing. Development work was carried out on e-commerce 
and e-service strategies and a workshop took place in December on possible future 
EU support for the Private Sector Development Strategy. 

Economic  progress  is  monitored  through  a  Trust  Fund  with  the  World  Bank.  An 
Economic Update Report was provided in June. 

4.2.3.  Objective 3: Fostering reconciliation, confidence building measures, and support to 

civil society 

Support  to  the  Committee  on  Missing  Persons,  managed  jointly  with  UNDP, 
continued  and  a  new  Contribution  Agreement  was  signed.  During  2012,  UNDP 
signed a contract with the International  Committee on Missing Persons (ICMP) for 
DNA analyses at the ICMP facilities in Bosnia and Herzegovina. CMP achievements 
2012  include:  excavations  at  92  sites,  284  set  of  remains  prepared  by  the 
anthropological laboratory and sent for DNA analyses, 22 sets of remains identified 
and 22 sets returned for burial to their families. It would be important to increase the 
contribution by other donors. 

Programme  visibility  has  been  enhanced  through  distribution  of  a  brochure  to 
schools and a UN-organised  visit to Cyprus  of  family  members  of  missing  persons 
from  conflicts  in  Kosovo6  and  Serbia.  A  CMP  live  music  event  took  place  in 
December, attended by families of missing persons. 

6 

This designation is without prejudice to positions on status, and is in line with UNSCR 1244 and the 
ICJ Opinion on the Kosovo declaration of independence. 

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Out of 27 remaining projects funded under three grant schemes of the Cypriot Civil 
Society in Action programme, 23 were completed in 2012. An impact assessment of 
the civil society support was launched in December. 

Cultural  Heritage  protection  has  continued  with  a  €2  million  Contribution 
Agreement  signed  with  the  UNDP  in  April  for  emergency  stabilisation  on  sites 
selected by the bi-communal Technical Committee, including the Othello Tower in 
Famagusta. The project was delayed eight months by a boycott of TCc Contractors 
Union over the conditions for dispute settlement. This problem was finally resolved 
early in 2013. 

The  project  for  demining  the  buffer  zone  was  completed  and  a  closure  event  was 
organised jointly with UNDP in March, to mark the International Day of Demining 
(4 April). 

4.2.4.  Objective 4: Bringing the TCc closer to the EU 

After  five  annual  scholarship  schemes,  an  evaluation  was  carried  out  in  2012.  The 
2012-13  programme  was  a  pilot  scheme,  adopting  a  number  of  proposals  from  the 
evaluation,  and  28  scholarships  were  awarded.  Other  recommendations,  including 
widening of the scheme to professionals outside the academic fields and outsourcing 
the grant management, will be pursued. 

The  InfoPoint  project  continued  its  role  as  an  information  channel  to  the  TCc 
preparing  events,  videos  and  providing  information  on  grant  calls.  The  frequently 
visited  bi-lingual  web  site  was  maintained  and  six  news  bulletins  in  Turkish  were 
published. 

4.2.5.  Objective 5: Preparing the Turkish Cypriot  community to introduce and  implement 

the acquis 

The  Commission's  Technical  Assistance  and  Information  Exchange  (TAIEX) 
instrument helps prepare the TCc for implementation of the EU acquis following the 
settlement  of  the  Cyprus  problem.  TAIEX  supports  the  preparation  of  acquis-
compliant legal drafts. EU experts carried out 415 actions in 2012, including training 
courses,  workshops,  and  study  visits.  Progress  of  draft  legal  texts  aimed  at  acquis-
alignment  was  critically  slow  in  2012,  although  legal  texts  on  environment,  animal 
health  and  seatbelts  were  adopted.  Preliminary  work  was  also  done  on  Free 
Movement  of  Goods,  Intellectual  Property  Rights  and  Mutual  Recognition  of 
Professional Qualifications. 

Support  to  trade  across  the  Green  Line  (Regulation  866/2004)  continued.  EU 
Member  State  experts  carried  out  regular  phytosanitary  inspections  of  potatoes  and 
citrus products. Analyses of local honey showed that the conditions of Commission 
Decision  2007/330  (movement  of  animal  products)  have  been  met,  opening  the 
possibility of trade in honey under the Green Line Regulation. 

4.3. 

Financial execution (contracts and payments) 

4.3.1.  Contracting 

Commitments in 2012 (€14.6 million) were 85% of the forecast figure. Delays in the 
launching of grant calls prevented reaching the target. 

4.3.2.  Payments 

In 2012, payments were €25.2 million, 69% of the forecast amount. The deficit was 
almost  entirely  due  to  a  shortfall  in  payments  for  works  and  supply  contracts  from 

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the 2006 programme. The 40% payment due on final acceptance of the €10 million 
telecom system was delayed beyond 2012 due to testing problems. 

4.4.  Monitoring 

Since  the  Commission  acts  as  Contracting  Authority,  the  level  of  supervision  by 
Commission  staff  is  high,  with  "spot-check"  visits,  site  meetings,  steering 
committees and Project Management Unit reporting. In addition, the Implementation 
Review Mechanism (IRM) provides a detailed review together with the beneficiaries 
of all projects. TAIEX activities are monitored through more than 20 Project Steering 
Groups,  plus  bi-annual  Monitoring  Mechanism  meetings.  TAIEX  logistics  are 
monitored through the on-line TAIEX Management System.  

Low capacity of grant beneficiaries causes implementation difficulties, for example 
with  EU  procedures  for  procurements  using  grant  funds.  To  address  this,  the  PMU 
set up in 2008 to support the Rural Development projects was extended to the SME 
grant sector in 2012. 

4.5. 

Audit and controls 

Between  2010  and  2012,  a  total  of  96  grant  beneficiaries  were  subject  to  financial 
monitoring and 16 audits were carried out. Problems were cleared on a case-by case 
basis. Findings on grant contracts included observations on accounting, procurement, 
rule of origin, budget management and VAT. This will be addressed in future grant 
calls by extended training and grantee supervision. The Internal Audit Capability of 
DG  ELARG  conducted  an  audit  on  Joint  Management  to  assess  internal  control 
systems of the DG. The report is expected in 2013. 

The Commission introduced improvements in the implementation of the programme 
following  ECA's  recommendations.  It  also  made  proposals  in  the  context  of  the 
Multiannual Financial Framework (MFF) to improve sustainability by increasing the 
predictability of funding. 

4.6. 

Evaluation 

Four  sector-level  evaluations/needs  assessments  were  carried  out  in  2102  on:  1) 
scholarships, confirming appreciation by beneficiaries and recommending widening 
of  the  scheme;  2)  water/wastewater,  giving  a  clear  list  of  priorities;  3)  vocational 
training/lifelong learning, recommending a follow-up to support career guidance and 
employment  services;  4)  solid  waste,  identifying  the  lack  of  waste  recycling  or 
composting,  the  need  for  closure  of  old  dumpsites  and  for  better  medical  waste 
treatment.  An  overall  programme  evaluation,  to  be  completed  in  2013  was  also 
launched. Evaluations in the fields of education and civil society were contracted in 
December. 

4.7. 

Information, Publicity and Visibility 

There were 86 visibility actions in 2012, considerably more than in 2011, including 
many  project-related  events  and  information  or  networking  activities  organised  by 
the  InfoPoint.  A  Europe  Day  event  was  carried  out  at  the  historic,  EU-renovated 
Bedestan  and  a  CMP  live  music  event  took place. There were art  and  photography 
exhibitions,  project  events  and  handovers,  plus  information  sessions  on  grants.  A 
brochure on the main achievements under the aid programme was produced7. Press 

7 

http://ec.europa.eu/cyprus/documents/2012/eu_assistance_to_tcc_brochure.pdf  

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releases  on  the  aid  programme  for  the  TCc  were  disseminated  by  the  Commission 
Representation in Cyprus. 

4.8. 

Consultations with the Government of the Republic of Cyprus 

Regular meetings were held with representatives of the Government of the Republic 
of  Cyprus,  in  particular  when  senior  Commission  officials  visited  the  island.  The 
Commission continues to rely on its cooperation for verification  of  property  rights, 
and also meets regularly with the Permanent Representation in Brussels. 

5. 

CONCLUSIONS 

The programme, which effectively started its implementation on the ground in 2009, 
has  brought  some  visible  benefits  to  the  TCc  during  2012,  notably  with  big 
contributions to wastewater and solid waste management. More efforts will have to 
be made, however, to make progress in other environmental sectors, in particular on 
nature  protection,  and  especially  in  respect  of  potential  Natura  2000  sites.  It  is 
important  to  show  that  the  EU  can  deliver  effective  assistance  and  a  positive 
message. It is now up to the TCc to ensure the sustainability of projects which have 
been delivered and accelerate the implementation of the assistance. 

Progress  towards  meeting  the  main  objective  of  the  Regulation  to  facilitate  the 
reunification  of  Cyprus  by  encouraging  the  economic  development  is  difficult  to 
achieve, given the operating context in the northern part of the island. 

In  order  to  protect  the  EU's  financial  interests,  the  Commission  will  not  sign 
contracts requiring bank guarantees until legal certainty is ensured.  

Preparation for the future adoption and implementation of the acquis slowed down in 
2012.  The  TCc  needs  considerable support in order to meet acquis requirements in 
many  areas  following  a  settlement  and  reunification.  Lack  of  resources,  inefficient 
structures and unclear responsibilities remain serious issues to be urgently addressed 
in  order  to  ensure  the  sustainability  of  EU-funded  projects.  The  TCc  has  reassured 
the Commission that EU-funded assets shall not be subject to privatisation.  

Some  parts  of  the  programme  have  become  established  as  core  components  with 
particular  value  in  confidence  building  or  in  bringing  the  TCc  closer  to  the  EU. 
These include the support to the CMP and to the Committee on Cultural Heritage and 
the scholarship programme. 

The completion of many of the projects from the 2006 programme brings a natural 
milestone and a considerable evaluation effort has been made in 2012. 

Medium  and  long-term  planning  is  challenging  in  the  absence  of  predictability  of 
annual  allocations.  Sectors  important  for  future  acquis  compliance  require  multi-
annual support for intervention to succeed fully. In its 2012 report, the ECA linked 
the lack of multi-annual programming to problems of programme sustainability. 

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