CELEX: 51990PC0654
Language: en
Date: 1990-12-17
Title: PROPOSAL FOR A COUNCIL DECISION CONCERNING GENERAL GUIDELINES FOR FINANCIAL AND TECHNICAL COOPERATION WITH THE DEVELOPING COUNTRIES IN LATIN AMERICA AND ASIA DURING THE PERIOD 1991-95

13.2.91                              Official Journal of the European Communities                                No C 37/3
                                                             II
                                                     (Preparatory Acts)
                                                COMMISSION
             Proposal for a Council Decision concerning general guidelines for financial and technical
             cooperation with the developing countries in Latin America and Asia during the period 1991 to
                                                            1995
                                                    COM(90) 654 final
                                   (Submitted by the Commission on 20 December 1990)
                                                       (91/C 37/03)
THE COUNCIL OF THE EUROPEAN COMMUNITIES,                                                  Article 2
                                                                                         Objectives
Having regard to the Treaty establishing the European             In general, development aid is the expression of the
Economic Community,                                               Community's support for the LAA developing countries,
                                                                 which face serious problems (population growth, mass
                                                                 poverty, financial and environmental difficulties) for
Having, regard to the Council Regulation (EEC) No                which they alone cannot muster all the necessary
442/81, and in particular Article 9 (2) thereof,                 resources and know-how.
Having regard to the proposal from the Commission,
                                                                 Within the range of development instruments, financial
Having regard      to  the   opinion   of   the  European        and technical cooperation is designed to transfer funds
Parliament,                                                      and targeted know-how to specific operations (projects
                                                                 or programmes of varying types) with a view to solving
                                                                 general or sectoral problems or carrying out pilot
Whereas general guidelines should be determined, for             schemes aimed at developing new strategies.
financial and technical cooperation with the developing
countries in Latin America and Asia for 1991, for
application on a five-yearly basis in order to ensure that
Community operations in this field are consistent,               Given the immense scale of the needs of the LAA
                                                                 developing countries and the quality of the aid that can
                                                                 be mobilized via financial and technical cooperation,
HAS DECIDED AS FOLLOWS:                                          such cooperation should be directed primarily at
                                                                 improving the living standards of the neediest sections of
                                                                 the population in the countries in question. It should also
                                                                 have a pump-priming or catalytic effect in areas where
                         Article 1
                                                                 domestic resources or external aid are hard to mobilize,
                   General framework                             but which are of strategic importance either for the
                                                                 balanced development of the developing countries or for
There are two basic channels of cooperation between the          the international community as a whole.
Community and the LAA developing countries, namely
development aid and economic cooperation, which
supplement trade relations and political dialogue.
                                                                                          Article 3
Financial and technical cooperation, which began in
                                                                                     Eligible countries
1976, is one of the main instruments of development aid
and includes food aid, the export earnings stabilization         1.    All the developing countries in Latin America and
mechanism, opportunities for co-financing operations             Asia except for those which belong to the ACP group of
undertaken by European NGOs and various types of                 countries or which are covered by the Community's
emergency and humanitarian aid, which have to be coor-           Mediterranean policy are in principle eligible for
dinated and, where necessary, combined.                          financial and technical cooperation.
 ---pagebreak---  No C 37/4                             Official Journal of the European Communities                                 13. 2. 91
 By its nature, however, such cooperation is principally          Current Community support for international agri-
 intended to support the efforts of the poorest or most           cultural research will also be maintained and special
 disadvantaged countries.                                         attention will be given to national and regional research
                                                                  requirements, above all the needs of small farmers.
 It will be extended to other countries in the two regions
 in specific fields or cases where Community action is
 taken in response to unforeseen events or in the short or        Particular attention must be given to the fight against
 long term leads to larger-scale operations or new policies      drugs in cooperation with the LAA developing countries
 to help particularly under-privileged sections of the           where the main production areas are located.
 population or essential sectors at regional or world level,
 but which do not constitute a clear priority in terms of
 allocation of domestic resources. The aid will be used          As part of operations to assist the rural sector, special
 essentially to deal with problems involving:                    attention will be given to crop conversion schemes,
                                                                 provided that these are grounded on normal economic
                                                                 criteria. Otherwise such schemes will not be undertaken
— natural disasters,                                             unless additional appropriations are available under other
                                                                 Community policies or provided by other aid donors.
— regional cooperation,
— strengthening of institutions,                                 2.     The environment and natural resources
— the environment and drugs.
                                                                 The environment and natural resources will be a new
                                                                 priority area for financial and technical cooperation.
2.     Community aid is directed towards development
centred on people and thus entails respect for and
promotion of all human rights. Efforts made to further           All projects or programmes will be designed and assessed
or ensure fuller enjoyment of these rights will be taken         to ensure that their environmental impact is as favourable
into consideration in the allocation of resources.               as possible and, particularly in the rural sector, where
                                                                 there are alternative options, preference will be given to
                                                                 projects aimed at environmental protection, such as the
For operations directly targeted at people faced with            management of river basins, 'social' reafforestation and
serious development problems, however, the only                  so on.
condition governing the granting of such aid shall be the
assurance that the target populations can effectively be
reached without interference.
                                                                 A proportion of all financial and technical cooperation
                                                                 funds will be reserved for projects specifically aimed at
                                                                 environmental protection (such as protection of tropical
                          Article 4
                                                                 forests) which the governments of the developing
                    Main fields of action                        countries concerned do not consider to be a high priority
                                                                 because of their very long-term results. This reserve
1.     The rural sector                                          (minimum 10 % ) , which could possibly be increased
                                                                 under the annual budget procedure, will be used to
Financial and technical cooperation continues to give            finance projects and programmes aimed at:
priority to the rural sector for the simple reason that
most of the population in the LAA developing countries
belongs to this sector, that it includes the least-favoured      — informing and educating the public, training
strata of society and that the Community has solid                    management and technical experts and strengthening
experience in such matters.                                           environmental    structures   in LAA       developing
                                                                      countries;
All the subsectors will be taken into consideration
depending on the situation and priorities in each
country: agriculture, fishing, stock-farming, rural loan         — carrying out feasibility studies and pilot schemes.
schemes, production and service infrastructure, training
and so on.
                                                                 3.     Regional cooperation
Improving the level of food security will continue to be a
matter of the utmost importance.
                                                                 Regional cooperation among developing countries
                                                                 continues to be a priority area for financial and technical
The problems of small towns which provide services for           cooperation because of its inherent importance and the
rural areas will also be taken into consideration.               Community's experience in the field.
 ---pagebreak---  13. 2. 91                              Official Journal of the European Communities                               No C 37/5
Four areas should be considered:                                  6.     The human dimension of development
  (i) regional cooperation on the environment;
                                                                  This heading covers a number of aspects. It should be
                                                                  taken into account in all other areas of action because of
 (ii) the development of intra-regional trade;                    the inherent justification of this form of cooperation.
(iii) strengthening of regional institutions;
                                                                  Careful attention should therefore always be given to the
                                                                  aspects referred to below when operations are identified
(iv) communications      —     particularly   networks   and      and implemented, and in addition such issues should be
      services.                                                   the subject of specific projects.
4.     The structural dimension of development                    The role of women in development is of capital
                                                                  importance. Steps must be taken to ensure not only that
                                                                  the changes brought in by projects and programmes do
The structural dimension of development is a new                  not alter the existing situation to women's cost but that
priority which should be covered by financial and                 specific measures, or even projects or programmes, are
technical cooperation.                                            selected in order to promote their full participation on an
                                                                  equal footing in the production and decision-making
                                                                  processes and in social activities (*).
Although the problems of structural adjustment proper
are generally outside the scope of Community aid to the
LAA developing countries, macroeconomic and sectoral
problems should be taken into account in the choice and           The problems of native ethnic groups deserve special
design of schemes.                                                attention, particularly because they often belong to the
                                                                  most disadvantaged sections of the population. The need
                                                                  to respect their desire to maintain their culture and social
Projects and operations financed by Community aid will            organization should also be taken into particular
be systematically scrutinized to ensure that they fit into        account.
sectoral policies conducive to their success (for example,
farm prices, savings policy, rural loans schemes and so
on). In appropriate cases, support will be given to
                                                                  Population problems are a major issue for a good many
improving these policies, either as part of larger-scale
                                                                  developing countries and should be taken into account
projects or on an independent basis.
                                                                  by the Community, which must give financial and human
                                                                  support for any action put forward in agreement with
Some structural schemes affecting a whole sector, a               the grassroots communities.
region of a country or several countries could also be
considered. For such schemes, cooperation with the
relevant international bodies and bilateral donors would          Community aid could also be used to help improve living
be sought.                                                        standards in the big towns via upstream or demon-
                                                                  stration schemes involving:
5.     Rehabilitation and reconstruction following    natural
disasters and preventive measures                                  (i) the transfer of know-how for dealing with urban
                                                                       problems;
This is a necessary field of action as it goes further than
emergency aid and emergency food supplies in alle-
viating the plight of the victims. Some 10 % of resources         (ii) developing and undertaking pilot schemes aimed at
for the whole period should be earmarked for this type                 the informal sector, notably the development of
of aid, with the possibility of exceeding the ceiling in any           micro-enterprises.
given year.
                                                                  Training must be both an end in itself and a regular
As far as the nature of the operations is concerned, they         feature of all operations supported by the Community,
can cover any sector according to need. Besides                   not only for the leaders but also for the people
financing reconstruction, rehabilitation or disaster              concerned themselves.
prevention projects, more rapid means of intervention
should also be developed, particularly in the case of
major natural disasters, in the form of direct support
programmes for the population or financial transfers to
the national authorities.                                         (') Conclusions of the Council of 29 May 1990.
 ---pagebreak---   No C 37/6                             Official Journal of the European Communities                                  13. 2. 91
  Wherever necessary, support could be provided for                Wherever possible, thanks to the multiannual character
  specific training schemes in all the various sectors             of Community cooperation with the LAA developing
  covered by these guidelines.                                     countries, multiannual programming on the basis of
                                                                   objectives will be undertaken for each country and where
                                                                   appropriate by region.
  Regular information must be provided about the oper-
  ations financed by the Community, with recourse where
                                                                   This programming — which will be of an indicative,
  feasible to new technologies.
                                                                   flexible nature — should help to increase the impact of
                                                                   Community aid on the general policies of the countries
                                                                   concerned.
                            Article 5
  1.    Recipients and operators                                   It will take account of the possible contribution of other
                                                                   Community cooperation instruments, such as food aid
                                                                   and economic cooperation.
  Given that aid must be targeted at men and women,
 directly or indirectly the final recipients of every              Resources will be allocated to the various recipient
 operation will be the people of the developing countries.        countries and regions by reference to:
 The range of operators (and intermediate beneficiaries)             (i) the income levels and development needs of the
 involved in financial and technical cooperation schemes                 various countries;
 should remain as wide as possible so as to include not
 only States and regions but decentralized public auth-
 orities, local or traditional communities, private institutes      (ii) the intrinsic value of operations in terms of devel-
 and operators and also NGO's.                                           opment potential and their contribution to healthy,
                                                                         realistic macroeconomic policies and to the needs of
                                                                         the most disadvantaged sections of the population;
 The necessary coordination with the authorities in the
 country concerned need not automatically mean that aid           (iii) the possibility of arousing the country's interest
 must be channelled via the public sector — in some cases                and/or mobilizing additional resources to assist
 other operators will be chosen on the basis of their effi-              certain sectors.
 ciency, qualifications and specific experience.
                                                                  3.      Forms of transfer, projects and programmes
 2.    A country can develop only as a result of joint
 efforts from within the country by the population and
the government chosen by them, taking account of the
                                                                 Aid will be allocated to projects and programmes and,
 social values and cultural heritage of each people.
                                                                 wherever feasible, to integrated projects, sectoral
                                                                 programmes and quick-disbursing programmes.
Outside support can do no more than speed up the
process, for example by providing the extra financial             The latter type of scheme comprises support for
resources and technical and organizational know-how               economic reform programmes where circumstances
which the country does not possess.                              justify it, and other types of structural measures with a
                                                                  sectoral or regional approach within a given developing
                                                                  country.
Community cooperation schemes are carried out against
a background of growing dialogue with the LAA
                                                                 All aid is in the form of grants because of the developing
developing countries on all issues of mutual interest,
                                                                 countries' increasing difficulty in repaying debts and the
both political and economic, at all levels — international,
                                                                 social orientation of financial and technical cooperation.
regional and bilateral.
                                                                 It might, however, be worth applying suitable mech-
As regards financial and technical cooperation the               anisms to link the gift of aid to a country (or a
priority areas for Community support will emerge from            community or region) with procedures for refunding by
this dialogue, which should cover not only the form that         the individual recipients, in particular when the purpose
oprations should take but also general policies which            of the scheme is to support profitable activities or small
could affect these operations and their implementation.          businesses.
 ---pagebreak---  13. 2.91                             Official Journal of the European Communities                             No C 37/7
 Similarly, where there are the necessary guarantees and         Coordination should be stepped up, particularly with the
 where there are grounds for giving Community aid a              bilateral aid provided by the Member States, which
 greater role to play, it will be possible to advance the        would, furthermore, reinforce the European presence.
 requirements in local currency of traditional projects for
 the supply of imported products (or other methods) in
 order to establish counterpart funds (to be deposited in        Co-financing is the closest possible form of coordination
 inflation-proof accounts) for the use of the project            and thus deserves particular attention but at the same
 managers.                                                       time the decision-making process and execution need to
                                                                 be made much less slow and cumbersome — the result of
                                                                 the number of decision-makers and the particular rules
                                                                 governing each of them.
 Each individual scheme (project or programme) will be
 subject to technical and economic analysis. This will
enable clear objectives backed up by figures to be set and
thereby make subsequent evaluation of the results easier.                                 Article 6
                                                                              Specific regional considerations
 Efforts must be made to ensure that the local population       Aid will be adapted to the needs and priorities of each
participates not only in undertaking operations but right       country and each region.
from their conception. A maximum 3 % of the total
resources allocated to financial and technical cooperation
with the LAA developing countries could be used to
cover study costs, the cost of recruiting short and             The Community must also take account of the specific
long-term experts and other auxiliary staff to assist the       nature of its relationship with each of the regions of
recipients and the Commission in devising general               Latin America and Asia.
policies, identifying and drawing up projects, monitoring
their execution and assessing their results during and
after, none of which would be included in individual            With regard to Asia, the large number of least developed
projects or programmes.                                         and densely populated countries means that Community
                                                                aid should be concentrated on those developing
                                                                countries with a relatively low level of development.
4.     Coordination and integration of aid
                                                                In rural areas, in addition to technology transfer,
                                                                Community aid should help to increase investment —
                                                                especially in production. Attention will also be given to
                                                                population policy and to communications, telecommuni-
All instruments of Community cooperation should be              cations and energy-producing infrastructure in rural
carefully integrated so that they work together with            areas.
maximum efficiency. Integration should be sought not
only in overall planning of cooperation on a country-
by-country basis (see Article 5 (2)), but also when each
project or programme is prepared.                               The wide variety of civilizations and development situ-
                                                                ations in Asia must be taken into consideration so that
                                                                Community aid is adapted to the needs of the different
                                                                countries.
Integration of instruments particularly applies to food
aid and the Stabex system but it should be extended
wherever technically feasible to humanitarian aid and           There are three important aspects to environmental
economic cooperation.                                           protection: (i) saving the tropical rain forests,
                                                                particularly in South-East Asia, (ii) combating the
                                                                deforestation caused by population pressure, particularly
                                                                on the slopes of the Himalayas, and (iii) limiting the
As much benefit as possible should also be drawn from           adverse effects of industrialization in densely populated
the experience of NGOs, notably in connection with the          areas.
numerous projects co-financed with the Community.
                                                                Current developments in the Indochina peninsula give
Coordination with other aid instruments is one way of           hope for much greater respect for human rights. The
increasing the efficiency of operations by bringing             Community must join in international efforts to ensure
together a critical mass of resources so as to obtain the       that these political changes are matched by very rapid
maximum benefit from the advantages peculiar to each            economic recovery and the return of refugees and
of them.                                                        displaced persons.
 ---pagebreak--- No C 37/8                              Official Journal of the European Communities                                 13. 2.91
Regional cooperation is also an area in which further            — protection of the environment, in particular the
developments seem likely, and this applies to both Asean,            tropical rain forests, is essential not only for the
which has enjoyed longstanding Community support and                 countries in this region but for the entire human race.
South Asia (SARC), where a more active form of                       One of the reasons for this concern is that a large
regional cooperation is desirable, and also Indochina.               number of useful forest species are native to the
                                                                     region;
With regard to Latin America, the development
threshold of the countries eligible for Community aid            — strengthening the macroeconomic management capa-
must take account of the overall situation of the rela-              cities and science and technology capacities of Latin
tively more advanced countries in this region.                       American institutions.
Because of the vast differences between the richest and
poorest sections of the population in most Latin                                           Article 7
American countries, Community aid must be targeted at
the neediest sections of the population.                                           Evaluation and reports
In this connection, particular attention will be given to        Regular assessment, both during and after the implemen-
the production of basic foodstuffs, to measures                  tation of projects, enables means and objectives to be
supporting national land reform legislation and to               adapted to changing realities.
programmes enabling the grassroots communities — and
in particular the indigenous communities — to take
                                                                 Such evaluation will be based inter alia on the cost-effec-
charge of their own development.                                 tiveness approach set out in Article 2 of the Financial
                                                                 Regulation.
The determination and efforts of the countries in that
region to achieve regional and subregional integration
                                                                 All Community schemes are already subject to regular
will continue to receive strong support.
                                                                 concurrent assessment: this will be maintained and stan-
                                                                 dardized and ex-post evaluation will be extended and
In this context, Central America will be given particular        made more structured.
attention, in accordance with the Community's
commitments — which were reconfirmed at the 1990
                                                                 Reports presented to Parliament and the Council on a
Dublin Ministerial Conference (San Jose VI).
                                                                 regular basis and publications for the general public will
                                                                 ensure that financial and technical cooperation is
Some of the proposed new objectives of Community aid             managed in a transparent way.
are of particular interest to this continent:
                                                                 Annual reports will be drawn up at the end of each
— drug production plays a considerable role in the               budget year giving the results of implementation
    economy of some countries in the region.                     (commitments and payments) and the projects and
    Community aid should be able to help, albeit to a            programmes prepared and selected in the course of the
    small extent, in solving this problem. In this               year.
    connection an initial coordinated response should be
    given to the efforts made by Colombia and the other
                                                                 More detailed reports also giving the results of
    Andean Pact countries,
                                                                 evaluation will be presented at the end of and halfway
                                                                 through the five-year period (1991 to 1995), making it
— aid for the development of micro-enterprises in the            possible not only to assess implementation but also to
    cities is a special priority in Latin America, even in       decide whether the guidelines for aid should be main-
    the relatively advanced countries,                           tained or altered.