The European Union maintains relations with a large number of developing countries. In order to contribute to reducing and eradicating poverty the EU created the European Development Fund (EDF). Its main purpose is to promote economic, social and environmental development.
The EDF provides development aid to the African, Caribbean and Pacific (ACP) countries and Overseas Countries and Territories (OCTs). The EDF funds cooperation activities and projects which covers economic, social and human development as well as regional cooperation and integration.
The EDF is not funded by the EU budget. It is established by an internal agreement of the Representatives of the EU countries, sitting within the Council. The Fund is managed by a committee while the European Commission is responsible for the financial implementation of the proejcts and activities carried out with EDF resources.
As it is not part of the EU budget the EFD is therefore not subject to the principle of annuality (one-year validity). There are no time limits for implementing projects, although this will not take more than 10 years normally.
More about EDF in EU Public Finance (page 297)