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Myths and facts about EU budget and external cooperation

Currently, when EU institutions are working on the new financial framework 2014-2020, let's take a look how the EU budget makes Europe count in the world.

Financial instruments for devvelopment

Development Cooperation Instrument (DCI)

Objectives and general principles of the DCI have been formulated in line with the changed EU Treaties and the latest policies. Human rights, democracy and good governance have been given increased importance. The approach of differentiation reflects needs, capacities and performance of partner countries, and targets EU development cooperation where it can have most impact: Least Developed Countries are the key priority. The DCI encourages greater concentration on certain sectors in partner countries to ensure that the EU's policy and the policies of the Member States complement each other in all areas of intervention.

Thematic programmes are concentrated and simplified by reducing them to just two: (1) 'Global public goods and challenges' and (2) 'Civil society organisations and local authorities'. The DCI will also include a new Pan-African programme in line with the Joint Africa-Europe Strategy. This programme complements other financial instruments which are applied in Africa (in particular ENI and EDF) and will support activities of trans-regional, continental and global nature in Africa and also specific initiatives for which no alternative source of funding can be mobilised.

Accompanying measures for former Sugar Protocol countries and major Banana producing countries will not be continued. These had been introduced to support the economic transition following tariff changes in the trade of these commodities with the EU;

The EU will improve its coordination in countries or regions for which a joint framework  exists that lays down a comprehensive Union strategy, including development policy. Where EU and Member States agree on joint multiannual programming, no further strategy papesr will be required. Joint programming will allow reinforced donor coordination and division of labour.

The DCI will offer new flexibility for a faster decision-making, particularly in cases of crisis, post-crisis and fragility, e.g. through the use of unallocated funds and a review of the programming.

Programming can be simplified replacing Country Strategy Papers with other existing strategy documents and alignment with national planning cycles of developing countries.


The European Development Fund (EDF)

The 11th EDF (2014-2020) will continue to cover cooperation with African, Caribbean and Pacific Countries (ACPs) and Overseas Countries and Territories (OCTs) and will remain outside the EU budget. Only minor modifications are proposed compared to the 10th EDF (2008-2013). Mainly, Member States' contributions keys to the fund will be further aligned with the keys used for the EU budget. Furthermore, the next EDF will integrate elements from the second revision of the Cotonou agreement such as regional B-envelopes (non programmable allocations to cover unforeseen needs with a regional dimension) and a future shock-absorbing scheme, which will help ACP countries to mitigate the short-term effects of exogenous shocks. Today's proposal is only the first step of the 11th EDF package. It will be followed in the course of 2012 by a Commission proposal for the 11th EDF implementing regulation which will entail provisions on aid programming and implementation.


Partnership Instrument (PI)

The Partnership Instrument is not only the major innovation of the 2014-2020 external instruments package but also a key external policy tool. Its overall objective is to advance and promote EU interests by projecting the external dimension of EU internal policies (e.g. competiveness, research and innovation, migration) abroad and to address major global challenges (e.g. energy security, climate change, environment).

The PI would allow the EU to pursue agendas beyond development cooperation with industrialised countries, emerging economies, and countries where the EU has significant interests. Concretely, the Partnership Instrument would allow supporting a wide range of actions from climate change action to tackling intellectual property rights, from fighting human trafficking to protecting the environment, from market access to energy security.


Instrument for Stability (IfS)

The IfS is a key instrument of the EU to help prevent and respond to crises (or emerging crises) and create a safe and stable environment. It has been streamlined to better contribute to a comprehensive EU approach to conflict prevention and peace-building, crisis response and security threats. Its specific objectives are to:

  • Provide a swift crisis-response in political conflicts and when natural disasters occur, complementing humanitarian relief and interventions of the Common Foreign and Security Policy and the European Security and Defence Policy.
  • Enhance the EU capacity for crisis preparedness, conflict prevention and peace building in cooperation with international, regional and civil society organizations and EU Member States.
  • Build capacity to address global and trans-regional security threats, including - for the first time - climate change. The EU response can be offered in varying security conditions and will no longer be limited to the context of stable conditions.

Flexibility has been improved by expanding the maximum length of crisis response measures (so-called 'Exceptional Assistance Measures') up to a maximum of 30 months and the deployment of a second Exceptional Assistance Measure in cases of protracted conflict to build on the results of a previous one. In addition, in exceptional situations of urgency, the Commission will be empowered to adopt Exceptional Assistance Measures for up to €3 million without prior information to Council. This improvement in speed of deployment will allow the EU to respond to crises within a period of 48 -72 hours.


Instrument for Nuclear Safety Cooperation (INSC)

The INSC's geographical coverage will be extended to all third countries, but priority will be given to candidate and potential candidate, accession and neighbouring countries. Lessons learnt after the Fukushima reactor incident and the results of 'stress tests' of European nuclear power plants will be taken into account.


European Instrument for Democracy & Human Rights (EIDHR)

The EIDHR's scope has been updated on the issues of support to democracy, economic and social rights and freedom of thought. Its objectives have been better defined to protection of human rights and support of democratic processes. The instrument will have a stronger focus on the most difficult countries and urgency situations where human rights and fundamental freedoms are most endangered. In such situations, the Union will be able to respond in a flexible and timely manner through ad hoc grants. This will particularly be  the case where less speedy solutions would expose beneficiaries to the risk of serious intimidation or retaliation and in order to address urgent protection needs of human rights defenders on the ground. Concretely this means: informal partnerships can benefit from funds; re-granting within projects will be possible; grants for human rights defenders in urgent protection needs will be possible; direct award of grants can be used where calls for proposal are not possible (e.g. Belarus, Iran, China). Its implementation will be more flexible and will be fully untied which means that aid will not be labelled for certain countries in advance but be provided through open procedures, responding to needs.


Instrument for Greenland

This proposal of a revised partnership recognises the emerging international awareness towards Greenland and its geostrategic importance. The partnership allows for moving Greenland towards a diversified economy, for an increased focus on policy dialogue in areas of increased global importance (e.g. Artic issues and broadening the areas of cooperation to include issues such as environment, climate change, biodiversity, raw materials and research.


Common Implementing Regulation

This regulation offers new harmonised, simplified and flexible decision-making procedures common to four geographic instruments (IPA, ENI, DCI and PI) and three thematic instruments (INSC, EIDHR, IfS). Implementing measures will be adopted faster, thus accelerating the delivery of EU assistance. Provisions on implementation have been significantly simplified. The regulation also sets down the ruled for the use of innovative financial tools, such as blending of grants and loans.


Last update: 17/02/2012 | Top