EU Development policy - guide

10 November 2010
by eub2 -- last modified 10 November 2010

The European Commission has launched a public consultation on the future of EU Development policy. Faced with the triple challenge of economic, food and environmental crises, but also the generally encouraging economic performance of Developing countries, the Commission wishes to collect views on how the EU can best support developing countries to speed up their progress towards the Millennium Development Goals and beyond. Building on previous achievements, the Commission proposes four main areas for debate, focusing on the impact of EU aid, the facilitation of more inclusive growth, the promotion of sustainable development, and durable results in agriculture and food security. Following the public consultation open to EU and partner countries, the Commission will table a Communication on a Modernised EU Development policy in 2011. The following FAQ presents the background and main issues addressed by the Green Paper.

Why a Green Paper on EU Development Policy?

In 2010, the EU adopted an ambitious position in support of the Millennium Development Goals (MDGs), including the reaffirmation of the collective target of devoting 0.7% of its Gross National Income to Official Development Assistance (ODA) by 2015 and a commitment to improving the quality of aid. Development policy must aim at strengthening developing countries' capacity to generate growth for all their citizens while taking into account the economic, food and environmental crisis. The European Commission (EC) wants to open the debate on the way forward towards achieving the MDGs and speed up the fight against poverty. The Green Paper issued by the Commission opens officially the consultation to gather views on future EU strategic orientations. In this specific case, contributions would be greatly valued from the EU's partners in developing countries and all other stakeholders.

What about the EU effort for development compared with other donors?

The European Union is the biggest donor in the world, contributing for around 56% of global aid. In 2009 the European Union and its Member States gave a total of €49 billion in development aid.

The high impact issue

What about the impact of the EU development policy?

When looking at past achievements and at future steps, the real impact of cooperation is a core issue of the current debate.

The European Commission alone accounts for 13% of total EU aid flows – €12.3 billion in 2009 – in sectors such as infrastructure, energy and adaptation to climate change. Many concrete results from Commission's aid cooperation can be mentioned: 24 million people were assisted through food security related social transfer, 4.8 million people received technical and vocational training, more than 85 000 new female students enrolled in secondary education, 5.5 million children under one year of age were immunised against measles, almost 5000 health centres and facilities were built or renewed, more than 31 million people were connected to improved drinking water, 36 000 km of road were constructed, rebuilt or renewed.

However, much remains to be done and the Commission wants to concentrate its aid efforts and EU's aid where there is a clear added value to be shown. Specific criteria of impact and aid effectiveness should be discussed for all EU programmes and projects of development aid.

How does the EU ensure aid effectiveness?

The quality of aid is currently monitored against concrete targets agreed internationally - such as the Paris declaration (2005) and the Accra Agenda for Action (2008). Some elements have been highlighted to make aid more effective: putting the developing countries' governments into the driving seat to decide on what aid is spent and on how, cutting out the gaps and overlaps in donors work, improving the predictability and the transparency of aid, focusing more on the results and on Governments accountability. The Fourth High Level Forum on aid effectiveness will take place in Busan, Korea, from 29 November to 1 December 2011.

The Green Paper on EU Development Policy suggests considering the "High impact" of cooperation according to a number of conditions such as the added value, the requisite of EU coordination prior to approval of grants, the demonstration that the support will produce leverage on local reforms and on other sources of funding.

How to improve the coordination of aid?

The importance of aid coordination with other donors is a key issue. In 2007, Member States have underlined it with the "EU Code of Conduct on Complementary and Division of Labour in Development Policy". Then the 2008 international Accra Agenda for Action (AAA) built on the following commitments:

* Predictability (donors will provide 3-5 year forward information on their planned aid to partner countries),

* Country systems (partner country systems will be used to deliver aid as the first option, rather than donor systems)

* Conditionality (donors will switch from reliance on prescriptive conditions about how and when aid money is spent to conditions based on the developing country’s own development objectives)

* Untying (donors will relax restrictions that prevent developing countries from buying goods and services they need from whomever and wherever they can get the best quality at the lowest price).

In addition to these commitments, the EU wants to take concrete steps to make the EU aid coordination more systematic. This is why the European Commission will propose in 2011 a mechanism for "progressive synchronization of EU and national programming cycles at partner country level".

Towards a more inclusive growth

Why does the EU put forward economic inclusive and sustainable growth in its development policy?

Economic growth generates wealth and thus is an important precondition to the eradication of poverty. Increasing levels of growth are necessary to improve income and employment prospects in developing countries.

The underlying objective of aid is to act as a catalyst for inclusive and sustainable growth, enabling developing countries to pull themselves out of poverty. Providing that growth is socially inclusive, it produces a much greater effect in terms of poverty reduction than incremental increases in ODA. Both must work in complementarity.

Policy coherence How does policy coherence apply to development?

Many EU policies can have a major impact on the results of the EU development policy if they integrate developing countries in their strategies. That is why Policy Coherence for Development is a legal requirement under the Lisbon Treaty. Policy coherence is therefore a commitment that the EU has taken to help developing countries benefit from the opportunities created by non-aid policies in the EU.

The latest EU Trade policy strategy is a concrete and good illustration of making trade and development policies work in coherence. The Communication adopted by the Commission on 8 November takes into account development purposes and will be used to better integrate developing countries on the global trade.

For example, in the research and science field, EU and developing countries work jointly in areas of interest for developing countries, such as health or food security. Researchers from developing countries are encouraged by the Commission to participate in research programmes and mobility schemes. In the first two years of the implementation of the 7th Research Framework Programme (2007-2013), applications for research funding from African scientists amounted to €60 million.

In the environment field, the European Commission aims to protect forests globally. Under its Forest Law Enforcement Governance and Trade "FLEGT" Initiative, the EU imports only certified timber from its partner countries to fight illegal logging. Several African countries have signed such agreements with the EU.

Sustainable development: Climate change and Energy
What does the EU do to fight climate change in its external cooperation?

Since 2002, the Commission has committed €2.5 billion for climate-relevant activities – an average of €300 million per year. These programmes and projects deal with climate change without crowding out the poverty alleviation focus: protection and sustainable management of forests, promotion of energy efficiency and renewable energies, conservation of natural areas are for instance important sectors in which the EC cooperation has been intervening for years.

The geographical instruments (bilateral cooperation) are the preferred instruments for implementing environmental activities. These activities vary a lot from one country to the other, following the country situation and needs.

The Environment & Natural Resources Thematic Programme (ENRTP) supports environmental actions all over the world, frequently implemented in cooperation with civil society organisations. The ENRTP has been allocated just over 1 billion for years 2007-2013 and covers activities on most of the main environmental issues such as biodiversity loss, deforestation and forest governance, climate change adaptation and mitigation, energy efficiency and renewable energies, water, chemicals and heavy metal pollution etc. The EU is also committed to mainstream environment within all its development cooperation.

Today, Environmental Impact Assessments are undertaken on every project with potential negative effect on environment and mitigation measures are implemented if necessary.

What about the Energy sector? Energy is crucial to development, yet people across the globe cannot access sustainable and constant energy supplies. The Commission established the ACP-EU Energy Facility within the EU Energy Initiative for Poverty Eradication and Sustainable Development (EUEI

), with the aim of promoting equitable access to energy for all.

The ACP-EU Energy Facility is a co-financing instrument established in 2005 to support projects on increasing access to sustainable and affordable energy services for the poor living in rural and peri-urban areas in African, Caribbean and Pacific (ACP) countries

.

More than 1.6 billion people in the world mainly concentrated in rural and peri-urban areas of developing countries do not have access to electricity. The situation is particularly severe in ACP countries, where the rate of access to electricity can be as low as 10% in rural areas. Access to energy is a fundamental prerequisite for economic growth and social well-being. A second Energy Facility (EFII), with a total budget of €200 million, has been established under the 10th European Development Fund

for the period 2009-2013.

The second Energy Facility will be implemented through two calls of proposals. The first €100 million call

  was launched on the 30th of November 2009. Almost seven million people have already benefited from the 74 projects co-financed by the first Energy Facility.

Examples of aid in the energy field: * Energy efficiency in the construction sector in the Mediterranean With 10 countries involved and a budget of € 5 million from 2009 to 2012, MED-ENEC

aims at encouraging energy efficiency and the use of solar energy in the construction sector. It intends also to involve civil society in climate-oriented building techniques, energy efficiency and renewable energy use in buildings.

* Fighting climate change by investing in developing countries

GEREF

is a €75 million innovative public-private partnership to transfer clean and renewable energy technologies (e.g. small hydropower, biomass, wind farms) to developing countries. The expected impact is 3 million beneficiaries from the fund's investments, 1 gigawatt of clean energy brought to recipient countries and 2 million tonnes of carbon dioxide emissions saved.

* Energy services centres for rural communities

This €1.9 million project devoted to Mozambique

which has one of the lowest electricity access rates in Southern Africa. By the end of the project, 60 rural centres should be electrified using solar energy.

Sustainable development: Agriculture and food security What does the EU do to fight hunger in the world?

Food security remains a key challenge for many developing countries where 75% of the population still depends on agriculture. It is a central issue to all of the Millennium Development Goals as it is leading cause in child deaths. Furthermore, agriculture is a key to overall development: in developing countries, GDP growth generated by agriculture is up to four times more effective in reducing poverty than growth generated by other sectors1.

In 2010, chronic hunger affects 925 million people worldwide, 239 million of whom live in Africa. In March this year the Commission took a significant step towards helping developing countries address this challenge by adopting a new policy framework for food security. This policy puts food security and sustainable agriculture higher among the EU's priorities in the years ahead and prioritises support to those countries that have the biggest difficulties in meeting the Millennium Development Goal of halving poverty and hunger by 2015 (MDG 1); in particular, countries in Africa and countries in fragile situations where the highest hunger rates are found. In Africa, for example, small-scale farmers produce about 80% of the food consumed in the continent. But agriculture also holds great potential in stimulating widespread income growth in developing countries; GDP growth generated by agriculture is up to four times more effective in reducing poverty than growth generated by other sectors2. Experience has demonstrated the need to address this challenge in a comprehensive way, looking at the whole value chain: research and extension to farmers training, access to land, appropriate fertilizers, irrigation methods, transport to markets, storage, finance, banking and insurance, and processing capacity.

The main framework for EU cooperation with developing countries consists of country programmes financed by geographical cooperation instruments. For instance, over €1 billion in support to agriculture, rural development and food security is granted to Sub-Saharan Africa countries through the 10th European Development Fund (2008-2013). At the global, continental and regional level, the Food Security Thematic Programme (FSTP) provides about €250 million per year to address food security challenges in developing countries. In addition, the Food Facility assists 50 African countries worst affected by the food price crisis (2007/08) by providing €580 million as a temporary response to bridge the gap between providing emergency relief and long-term development support.

Example: The Food Facility

In 2008, the EU provided an additional €1 billion to support 50 developing countries worst affected by the food price crisis across the world. This 'food facility' is a swift and specific response to help millions of people in the short and medium term (2009-2011). It supports actions to mobilise farmers and smallholders in target countries in order to increase agricultural productivity, and secure access to food for the most vulnerable. So far, it has resulted in 222 projects and has benefited 50 million people in poor countries.

For example, with support from the Food and Agriculture organisation, the Food Facility has helped to provide quality seeds to 100 000 vulnerable farmers in Burkina Faso, benefiting about 700 000 people, amid the growing food crisis in the Sahel. With EU support worth €18 million, this operation will improve the food security of more than 860 000 rural households, which translates to over 6 million people.

Good governance and democracy
Why does the Commission support democratic processes in developing countries?

The European Union believes that democracy and human rights are universal values that should be vigorously promoted around the world. They are integral to effective work on poverty alleviation and conflict prevention and resolution, in addition to being valuable bulwarks against terrorism. The European Union is convinced that there cannot be long term development when laws and human rights are not ensured. Having come into force on 1 January 2007, the European Instrument for Democracy and Human Rights (EIDHR) is the concrete expression of the EU's intention to integrate the promotion of democracy, human rights and the rule of law worldwide.

Genuine elections constitute essential basis for sustainable development and a functioning democracy. The European Union believes that actions supporting the right to participate in genuine elections can make a major contribution to peace, security and conflict prevention. Support takes the form of electoral assistance projects and EU election observation missions.

What does the EU do to support Non State Actors?

EU support to non-state actors (NSAs) and local authorities encourages participation in development, at both national and local level. It also encourages working for better governance and more participative development which is thus more relevant to citizens.

The Structured Dialogue is an initiative launched by the EC to discuss the involvement of civil society organizations (CSOs) and Local Authorities (LAs) in EC development cooperation.

This dialogue is conceived as a confidence and consensus-building mechanism. It aims at increasing the effectiveness of all stakeholders involved in EC development cooperation. To this end, it is expected that stakeholders involved share information and knowledge and build trust, in order to strengthen partnerships and explore ways to improve not only EC working methods but also practices of its main partners.

In line with the global Aid effectiveness Agenda, it is an inclusive process, which seeks to bring on board all relevant stakeholders involved in EC development cooperation (EC, EU delegations, European Parliament, Member States, Civil society and Local and Regional Authorities from Europe and partner countries). This initiative aims at increasing effectiveness of all stakeholders involved by:

* building consensus on the role to be played by CSOs & LAs,

* finding ways to improve the effectiveness of CSO & LA involved in EC cooperation and

* exploring ways to adapt EC programmes

The dialogue was officially launched on 23rd of March 2010. The process shall continue in 2011 with a final conference in spring 2011. The process is composed of online discussions (structural dialogue blog and Civil Society Helpdesk), meetings (4 in 2010), regional seminars with 1 per region (Africa, Latin America and Asia in 2010, European neighbourhood policy region in 2011) and 3 supporting initiatives.

Why does the EU support security in its external cooperation?

Security and development are interdependent and mutually reinforcing. No sustainable development is possible in a country threatened by internal insecurity, crisis and conflicts. At the same time, there cannot be sustainable peace without development. Moreover, insecurity, crisis and conflicts can impede the efficient use of aid.

The European Commission’s approach to conflict prevention aims to address the root causes of conflicts and build sustainable peace through mediation and peace-support operations. Depending on the particular circumstances, its response to a crisis focuses on short and medium term support for rebuilding critical state institutions and for peace-building through transitional justice and reconciliation. In post-conflict states, the EU supports disarmament and arms-control measures in the framework of the UN Conference on Disarmament.

Related Links

Full text of the Green Paper :

Website of DG Development

Source: European Commission