European Development Fund

Last updated

The European Development Fund (EDF) was the main instrument for European Union (EU) aid for development cooperation in Africa, the Caribbean, and Pacific (ACP Group) countries and the Overseas Countries and Territories (OCT). Funding was provided by voluntary donations by EU member states. [1] Until 2020 the EDF was subject to its own financial rules and procedures, and was managed by the European Commission (EC) and the European Investment Bank. [2] The EDF has been incorporated into the EU's general budget as of the 2021–2027 multi-annual financial framework.

Contents

Articles 131 and 136 of the 1957 Treaty of Rome provided for its creation with a view to granting technical and financial assistance to African countries that were still colonised at that time and with which certain countries had historical links. Usually lasting 6 years, each EDF lays out EU assistance to both individual countries and regions as a whole.

Funding

Until its incorporation into the EU's general budget in 2021, the EDF was funded outside the EU budget by the EU Member States on the basis of financial payments related to specific contribution shares, or "keys". The Member State contributions keys were subject to negotiation. The EDF was the only EU policy instrument financed through a specific key that was different from the EU budget key, reflecting the comparative interests of individual Member States. [2]

There was a debate on whether to 'budgetise' the EDF. [1] However, in the Communication A budget for Europe 2020, the European Commission underlined that it was not appropriate at the time to propose that the EDF be integrated into the EU budget. [2] The perceived advantages included: [1]

The perceived disadvantages were that: [1]

In 2005, the EU and its Member States agreed to achieve a collective level of ODA of 0.7% of GNI by 2015 and an interim target of 0.56% by 2010, with differentiated intermediate targets for those EU Member States which had recently joined the Union. On 23 May 2011, EU ministers responsible for development cooperation gathered to take stock of progress made and concluded that additional efforts would be needed to close an estimated gap of €50 billion to reach the self-imposed collective EU target of 0.7% by 2015. [2]

By 2015, the EU had not reached 0.7% of GNI, though the commitment to this target was recently reaffirmed. The commitment held no deadline. Concord, the European confederation for relief and development, described the pledge as "vague and non-binding" and said 2020 should be the new deadline. [3]

The EDF has been incorporated into the EU's general budget as of the 2021–2027 multi-annual financial framework.

Agenda for Change

The European Commission's development strategy – Agenda for Change – puts ‘inclusive and sustainable growth for human development’ at its centre. Adopted in 2011, it adopted 2 reforms designed to make its development policy both more strategic and more targeted. The Agenda for Change made new policies and rules for budget support. The three main elements of this Agenda were:

10th EDF 2008–2013

The 10th EDF from 2008 to 2013 has a budget of €22.7 billion. [1] This represents about 30% of EU spending on development cooperation aid, with the remainder coming directly from the EU budget. [1]

The budget of the 10th EDF can be broken down as follows: [7]

11th EDF 2014–2020

The 11th EDF covers 2014 to 2020. This one-year extension compared to the 10th EDF allowed the end of the 11th EDF to coincide with the expiration of the Cotonou Agreement in 2020 and the EU budget period. [2]

The EU is currently implementing its 11th European Development Fund for 2014 to 2020, with an aid budget of €30.5 billion for many of the ACP countries and Overseas Countries and Territories (OCTs), covering both national and regional programmes. Effectively programming the European Development Fund (EDF) is a major political, policy and bureaucratic challenge, involving multiple stakeholders, namely the European Commission (EC), the European External Action Service (EEAS), 28 EU member states, the European Parliament, 74 governments from the Africa, Caribbean and Pacific (ACP) group of states and domestic accountability actors.

Understanding the magnitude of the 11th EDF programming challenge is critical for three reasons:

  1. The 11th EDF unfolds in a radically changed global context for development cooperation, as the United Nations Sustainable Development Goals (SDGs) were agreed in September 2015.
  2. The 11th EDF is the last before the Cotonou Partnership Agreement (CPA) between the EU and the countries of the ACP expires in 2020. [8]
  3. Programming and implementing the 11th EDF is a critical test of EU institutions that deal with external action, and it tests the ability of EU development policy to achieve high-impact aid, at a time when showing 'value for money' is a high political priority at a time when many European governments follow a policy of fiscal austerity.

After 2021

The EDF has been incorporated as part of Global Europe into the 2021–2027 multi-annual financial framework of the EU. For the European Parliament, that makes a chance for a greater say in how these funds are distributed. [9]

Critics

Independent research by the European Centre for Development Policy Management (ECDPM), a think tank based in Maastricht (The Netherlands), shows that the EU has ensured the effective translation into practice of two key policy commitments of the 'Agenda for Change' – namely a more focused strategy for less developed countries (LDCs) and low-income countries (LICs), and the concentration of EU aid on a limited number of sectors and policy priorities. Their research found that the high degree of compliance was achieved "through top-level support and tight control from headquarters". [10]

While the principles of the 'Agenda for Change' appear to have been followed, ECDPM showed that in many countries initial programming proposals based on in-country consultations, managed by EU Delegations, were then superseded by the choices of EU headquarters in Brussels. Although the 11th EDF is closely aligned with national development plans, there is evidence that this top-down approach to programming has led to a significant erosion of key aid and development effectiveness principles, in particular country ownership. [10]

See also

Related Research Articles

<span class="mw-page-title-main">Common Agricultural Policy</span> Agricultural policy of the European Union

The Common Agricultural Policy (CAP) is the agricultural policy of the European Commission. It implements a system of agricultural subsidies and other programmes. It was introduced in 1962 and has since then undergone several changes to reduce the EEC budget cost and consider rural development in its aims. It has however, been criticised on the grounds of its cost, its environmental, and humanitarian effects.

<span class="mw-page-title-main">Cotonou Agreement</span> 2000 EU economic and legal treaty with African, Caribbean and Pacific states

The Cotonou Agreement is a treaty between the European Union and the African, Caribbean and Pacific Group of States. It was signed in June 2000 in Cotonou, Benin's largest city, by 78 ACP countries and the then fifteen Member States of the European Union. It entered into force in 2003 and was subsequently revised in 2005 and 2010.

<span class="mw-page-title-main">Directorate-General for European Civil Protection and Humanitarian Aid Operations</span> European Commission department

The Directorate-General for European Civil Protection and Humanitarian Aid Operations, formerly known as the European Community Humanitarian Aid Office, is the European Commission's department for overseas humanitarian aid and for civil protection. It aims to save and preserve life, prevent and alleviate human suffering and safeguard the integrity and dignity of populations affected by natural disasters and man-made crises. Since September 2019, Janez Lenarčič is serving as Commissioner for Crisis Management in the Von der Leyen Commission, and since 1 March 2023, Maciej Popowski leads the organisation as the Director-General.

<span class="mw-page-title-main">European Structural and Investment Funds</span> European Union financial tools

The European Structural and Investment Funds are financial tools governed by a common rulebook, set up to implement the regional policy of the European Union, as well as the structural policy pillars of the Common Agricultural Policy and the Common Fisheries Policy. They aim to reduce regional disparities in income, wealth and opportunities. Europe's poorer regions receive most of the support, but all European regions are eligible for funding under the policy's various funds and programmes. The current framework is set for a period of seven years, from 2021 to 2027.

<span class="mw-page-title-main">Foreign relations of the European Union</span> Relations between the European Union and other countries

Although there has been a large degree of integration between European Union member states, foreign relations is still a largely intergovernmental matter, with the 27 states controlling their own relations to a large degree. However, with the Union holding more weight as a single entity, there are at times attempts to speak with one voice, notably on trade and energy matters. The High Representative of the Union for Foreign Affairs and Security Policy personifies this role.

<span class="mw-page-title-main">Multiannual Financial Framework</span> European Union framework regulating the annual budget

The Multiannual Financial Framework (MFF) of the European Union, also called the financial perspective, is a seven-year framework regulating its annual budget. It is laid down in a unanimously adopted Council Regulation with the consent of the European Parliament. The financial framework sets the maximum amount of spendings in the EU budget each year for broad policy areas ("headings") and fixes an overall annual ceiling on payment and commitment appropriations.

<span class="mw-page-title-main">Budget of the European Union</span> Monetary budget of the EU

The budget of the European Union is used to finance EU funding programmes and other expenditure at the European level.

<span class="mw-page-title-main">Technical Centre for Agricultural and Rural Cooperation ACP-EU (CTA)</span>

The Technical Centre for Agricultural and Rural Cooperation ACP-EU (CTA) was established in 1983 under the Lomé Convention between the African, Caribbean and Pacific Group of States and EU member states. Since 2000 CTA has operated within the framework of the ACP-EU Cotonou Agreement with a mission to “strengthen policy and institutional capacity development and information and communication management capacities of ACP agricultural and rural development organisations. It assists such organisations in formulating and implementing policies and programmes to reduce poverty, promote sustainable food security, preserve the natural resource base and thus contribute to building self-reliance in ACP rural and agricultural development.”. The centre is closed in 2020, after the end of the Cotonou Agreement and the subsequent end of its financing.

<span class="mw-page-title-main">European Centre for Development Policy Management</span> A Researching Firm

The European Centre for Development Policy Management, more commonly known as ECDPM, is a think tank founded in 1986. It is headquartered in Maastricht, Netherlands and has a second office in Brussels, Belgium.

Economic Partnership Agreements (EPAs) are a scheme to create a free trade area (FTA) between the European Union and other countries. They are a response to continuing criticism that the non-reciprocal and discriminating preferential trade agreements offered by the EU are incompatible with WTO rules. The EPAs date back to the signing of the Cotonou Agreement. The EPAs with the different regions are at different states of play. The EU has signed EPAs with the following countries: the Southern African Development Community (SADC), ECOWAS, six countries in Eastern and Southern Africa, Cameroon, four Pacific states, and the CARIFORUM states. Their defining characteristic is that they open up exports to the EU immediately, while exports to the partner regions is opened up only partially and over transitioning periods.

<span class="mw-page-title-main">ACP–EU development cooperation</span> Cooperation between the EU and the ACP countries

Development cooperation between the European Union (EU) and the countries of the African, Caribbean and Pacific Group of States (ACP) started in 1957 with the Treaty of Rome, which first established a collective European development policy. The Treaty of Rome granted associated status to 31 overseas collectivities and territories (OCTs) and provided for the creation of a European Development Fund (EDF) intended to grant technical and financial assistance to the countries which were still under European rule at the time. More significantly, however, by means of the Treaty of Rome the six member states of the European Economic Community were expressing solidarity with the colonies and OCTs and committed themselves to contribute to their prosperity. The EDF has to date been funded outside the EU budget by the EU Member States on the basis of financial payments related to specific contribution shares, or “keys”, which are subject to negotiation. The EDF is currently the only EU policy instrument that is financed through a specific key that is different from the EU budget key, and which reflects the comparative interests of individual Member States.

<span class="mw-page-title-main">Directorate-General for International Partnerships</span> European Commission department

The Directorate-General for International Partnerships is the European Commission department responsible for international development policy. It operates under the authority of the European Commissioner for International Partnerships, Jutta Urpilainen.

The Instrument for Stability was a financial and political instrument at the disposal of the European Union. It was prepared at strategic level by the EEAS and implemented by the European Commission. In 2021 the IfS was merged into Global Europe.

<i>The Courier</i> (ACP-EU) Magazine financed by the European Development Fund

The Courier was an ACP-EU development magazine published by the Development Directorate General of the European Commission, focusing on ACP-EU Development Cooperation. Financed by the European Development Fund (EDF), it was published every two months, till it came to end in 2011. Its last edition was nr 24 covering months of July and August 2011. Its overall stated objective is to communicate, explain, promote and support the development objectives and principles of the Cotonou Agreement.

Development Cooperation Instrument (2008–2013) covers three components: 1. Geographic programmers supporting co-operation with 47 developing countries in Latin America, Asia & Central Asia, the Gulf region and South Africa. 2. Thematic programmes benefiting all developing countries (including those covered by the European Development Fund 3. Programmes of accompanying measures for the 18 ACP Sugar Protocol countries, to help them adjust and following the reform of the EU sugar regime.

<span class="mw-page-title-main">Neven Mimica</span> Croatian politician and diplomat

Neven Mimica is a Croatian politician and diplomat who has been serving as European Commissioner for International Cooperation and Development in the Juncker Commission since 1 November 2014. He was previously the European Commissioner for Consumer Protection in the Second Barroso Commission from July 2013 until November 2014 and was in that regard the first European Union Commissioner from Croatia following its accession to the European Union.

<span class="mw-page-title-main">Cross-border cooperation</span>

Cross-border cooperation is the collaboration between adjacent areas across borders. In the European Union this is one of the forms of territorial cooperation. The European model is very diverse with cooperation between border regions or municipalities, or through specific cooperation structures. These structures are usually composed by public authorities from different countries organized in working communities, euroregions or EGTCs.

<span class="mw-page-title-main">Policy Coherence for Development</span>

Policy coherence for development (PCD) is an approach and policy tool for integrating the economic, social, environmental and governance dimensions of sustainable development at all stages of domestic and international policy making. It is the aim of Policy Coherence for Development to make foreign relations to be as ecologically, economically and socially coherent as possible and thereby to make international co-operation for international development more effective.

<span class="mw-page-title-main">European Defence Fund</span>

The European Defence Fund (EDF) is a component of the European Union's (EU) Common Security and Defence Policy (CSDP) which aims to coordinate and increase national investment in defence research and improve interoperability between national armed forces. It was proposed in 2016 by Commission President Jean-Claude Juncker and established in 2017. The fund has two stands; Research and Development & Acquisition. In July 2018, the European Commission announced that the EDF budget for 2021-2027 would be €13 billion. This sum was later revised by the European Commission as part of the new EU budget proposed on May 27, 2020, as a result of the COVID-19 pandemic, according to which the EDF will be allocated €8 billion over this budget period.

<span class="mw-page-title-main">Micronesia–European Union relations</span> Bilateral relations

Micronesia–European Union relations are the foreign relations between the country of the Federated States of Micronesia and the European Union. Cooperation between Micronesia and European Union was initiated in 2000 when the country joined the Organisation of African, Caribbean and Pacific States and is developed in the framework of Cotonou Agreement within the wider ACP–EU development cooperation. Two sides formalized their direct diplomatic relations on 18 April 2002 when the European Union ambassador Frans Baan attended diplomatic credential ceremony in Palikir. In 2008 the designated national authorizing officer for EU programs Fabian Nimea visited several EU member countries to promote further cooperation between his country and the European Union.

References

  1. 1 2 3 4 5 6 Mikaela Gavas 2010. Financing European development cooperation: the Financial Perspectives 2014–2020. Archived March 16, 2011, at the Wayback Machine London: Overseas Development Institute
  2. 1 2 3 4 5 Kilnes, U., N. Keijzer, J. van Seters and A. Sherriff More or less? A financial analysis of the proposed 11th European Development Fund (ECDPM Briefing Note 29) [ permanent dead link ]. Maastricht: European Centre for Development Policy Management (ECDPM)
  3. Clár Ní Chonghaile (June 2015). "EU draws fire for failing to set date for 0.7% aid target". The Guardian . Retrieved 21 May 2016.
  4. "Changes in the EU's "Agenda for Change"?". ECDPM. Retrieved 21 May 2016.
  5. "Analysis of the EU's State Building Contracts – ECDPM". ECDPM. Retrieved 21 May 2016.
  6. "Blending Loans Grants Development Effective Mix EU? – ECDPM". ECDPM. Retrieved 21 May 2016.
  7. "European Development Fund (EDF)". European Commission. Archived from the original on 2 November 2011. Retrieved 9 October 2011.
  8. "Dossier: The Future of ACP-EU Relations Post-2020 – ECDPM". ECDPM. Retrieved 21 May 2016.
  9. Niles Keijzer, Drifting towards exhaustion? Historical institutionalist perspectives on recent efforts to modernise the EU's partnerships with African states, in:Journal of Contemporary European Research, Vol.16, issue 3 (2020).
  10. 1 2 "Programming the 11th EDF – an independent analysis". ECDPM. Retrieved 21 May 2016.