• 03 June 2013

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    Category : Opinion

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    The EU’s 2014-2020 financial framework

    At the end of 2011, the European Commission presented its proposal for the 2014-2020 financial framework of the EU.In February 2013, the European Council decided to limit the 2014-2020budget to €959 billion (corresponding to 1% of GDP). This is the first austerity measure in the history of the EU's multi-annual financial frameworks. In real terms, it means a 3.4% reduction in the budget.

    Currently, the European Parliament and the European Council are negotiating with the European Commission on the adoption of the instruments that regulate the different chapters of the financial framework. Heading4, “Global Europe”, includes external action instruments with a funding proposal of €96.25 billion, which must be reduced to the total of €84.69 billion approved by the EU Council (€58.7 billion + €26.98 billion for the European Development Fund).

    Changes in the main external action instruments

    The October 2011 Agenda for Change is the programming document for the future development cooperation of the EU, introducing concepts such as the differentiated focus (geographical concentration), coordinated action (joint programming, innovative funding mechanisms such as blending, etc.) and the coherence of policies. The EU will focus its development cooperation efforts on:

    • human rights, democracy and other key elements of good governance, as the basis for
    • inclusive and sustainable growth for human development.

    The agenda will focus on three sectors per country (sectorial concentration). Pending adoption of the financial instruments, the EuropeAidcooperation office and the European External Action Service (EEAS) are preparing the 2014-2020 programming of funds, applying a series of new focuses:

    • Adaptation of the programming cycles to the cycles of the member countries(national development plans)
    • Reinforcement of the joint programming between the EU and the member states
    • Division of responsibilities between the EEAS(political economy analysis and programming)andDevCo (annual action programmes and programming of thematic lines)

    Pre-Accession Instrument(€14.11 billion, an 8% increase compared to the 2007-2013 financial framework). Beyond the funding of the chapters of the community acquis, theprogramming will include funding for support to the implementation of national development strategies. Reinforcement of the sectorial approaches (large programmes instead of individualised projects).

    European Neighbourhood Instrument(€18.8 billion, a 23% increase). Generalisation of the “more for more” approach of the SPRING programme. Russia can only receive funding on multi-country and cross-border cooperation programmes.

    Association Instrument(€1.13 billion, a 230% increase).  It funds EU interests abroad and global challenges (external dimension of the 2020 agenda of the EU) primordially in medium and high income countries (including LAC). This instrument does not require the fulfilment of ODA criteria.

    European Instrument for Democracy and Human Rights(€1.57 billion, a 21% increase). The objectives and the funding of activities are maintained without the consent of the countries in which the work is undertaken.

    Stability Instrument(€2.83 billion, a 42% increase). Simplification of the components:response to emergency situations (Service for Foreign Policy Instruments), conflict prevention (EuropeAid) and worldwide and trans-regional threats (EuropeAid).

    European Development Fund(€34.27 billion, a 13% increase). The 11thEDFis maintained without major changes as an inter-governmental instrument outside the general budget of the EU.

    Development Cooperation Instrument(€14.11 billion, an 8% increase):

    • Differentiated approach: concentration in 27 countries with low incomes in Asia, Latin America and Southern Africa (graduation of 19 countries towards non-ODA cooperation)
    • Reduction in Thematic Instruments(increase in flexibility between budgetary lines):
      • Thematic programme on global challenges and public goods (environment and climate change, sustainable energy, human development, food security, migration and asylum) (€6.3 billion)
      • Thematic programmes on civil society organisations (CSOs) andlocal authorities (LAs) (€2 billion)
      • Pan-African Programme(€1 billion)
    • Latin America:
      • Graduation of medium-income countriesexcept Central America, Paraguay and Bolivia (debate about Ecuador, Peru and Colombia)
      • Reinforcement of regional cooperation(continental and multi-country programmes). The following estimative figures are currently being negotiated:
      • €885 million for regional cooperation(€556 million in 2007-13)
      • €160 million for multi-country projects in the Andean region
      • €120 million for regional cooperation with Central America
      • To these funds, we must add those of cooperation with the Caribbean (EDF), which could be combined with the funds of the DCI in future continental programmes.
        • Countries of Latin America cooperate but do not integrate: disappearance of specific support packages to sub-regional processes (exceptSICA)
        • Increase in funding for “innovative” instruments and blending(Investment in Latin America Mechanism)

    Tobías Jung
    Antenna of the FIIAPP in Brussels

    The views and opinions expressed in this blog are the sole responsibility of its author.