On 12 April, EU Development Commissioner, Andris Piebalgs, presented the priorities he plans to focus on for European development policy in 2012 to the European Parliament’s Development Committee in order to have their views on these (you can click here to watch a recording of the meeting). This Talking Points blog post provides the only detailed written summary available of discussions at this meeting.
Commissioner Piebalgs said that a major focus will be the negotiations for the post-2013 EU Multi-Annual Financial Framework (MFF) and the amounts of financing that will be made available for external relations and development cooperation within this. Being able to meet EU Official Development Assistance (ODA) targets and future challenges will be key. For further details on his approach for these negotiations, he referred MEPs to his presentation made in February to the Parliament’s special committee on the policy challenges and budgetary resources for a sustainable European Union after 2013. He also informed MEPs that there would be an EC college seminar on the MFF on 4-5 May and that the EC aims to adopt its proposals on 29-30 June. Following the meeting with the Parliament, on 29 April, the EC published the contributions to and EC report of the public consultation on “What funding for EU external action after 2013?”
In a separate debate with the Chairperson of the European Parliament’s Special committee on the policy challenges and budgetary resources for a sustainable European Union after 2013, Development Committee MEPs expressed their fear, that they said is also being expressed by senior EC officials, that funding for development cooperation may be decreased in the context of financial constraints and in the face of vested EU Member States’ interests to maintain funding for policies such as the EU regional policy or Common Agricultural Policy. MEPs, therefore, argued for the need for the Parliament’s report to clearly call for additional, autonomous funding for development cooperation to meet existing commitments and future challenges. The European Parliament’s special committee on the policy challenges and budgetary resources is currently considering the 1,100 amendments from all the European Parliament’s Committees and is scheduled to vote on its report at its meeting on 25-26 May.
Financial instruments will also need to be adopted to implement the MFF. EC proposals for these, including for the instrument for development cooperation (DCI) will be put forward in 2012 (current instruments expire in 2013). The Development Committee also discussed the future financing instrument for development cooperation. The EC DEVCO representative informed MEPs that the EC is considering importing best practices from the European Development Fund (EDF) into the way it does programming under the DCI by way of envelopes for unforeseen needs.
In addition to financial allocations for development, Commissioner Piebalgs said another major focus in 2012 will be modernising EU development policy to be more focussed, relevant, efficient, effective and results oriented. He acknowledged that this is not an easy process in the current “complicated political atmosphere”. In a separate debate, an EC official indicated that the EC’s proposals on inclusive growth and sustainable development will be published sometime between July and September. According to interventions from MEPs, the delay seems to be due to debates within the EC on the definition of “inclusive growth”. MEPs are also seeking clarity on this issue as will certainly EU Member States in their discussions on this. The EC official said that the EC communication will give a clear definition of inclusive growth, and that it will include two key aspects – one relating to process, i.e. how all groups can contribute to growth and the second results oriented, i.e. how growth can be distributed fairly. Click here to see the Parliament’s draft report on the EC’s green paper on inclusive growth. The Development Committee has also commissioned an external study on this issue, due out soon. Please also see this previous ECDPM blog posting on how the EU needs to keep ODA promise and implement other development commitments.
Commissioner Piebalgs also said a focus in 2012 will be on demonstrating the added-value Europe can bring to development focusing on 4 areas:
i) Identifying what can be done better at EU level than at national level. The EC can be more than a 28th EU donor he said. It can be catalyst for systemic and global change to benefit developing partners. For example, one of EU’s greatest achievements has been the creation of one of largest, most effective internal markets in the world. The benefits of this are beyond question and the EC should help replicate this in the developing world with all the means at its disposal he said. The EC can provide value added in this area, beyond financial support, in terms of providing know-how on the EC’s experience in social and political integration. Another example of an area where there is EC added value is in making full use of policy coherence for development. Separately, an EC DEVCO official informed MEPs that the third EU report on Policy Coherence for Development will be issued in November 2011.
ii) Work to increase fiscal revenues and growth opportunities for developing countries by using innovative financial instruments and EU Member States’ investments to maximise results-oriented projects.
iii) Work with countries to apply a more targeted approach on budget support which can be a driver for change to grow economically and politically. He stressed that budget support can only be used where countries’ share the EU’s democratic and human rights values arguing that no development policy will succeed where there is no democracy and respect for human rights.
iv) Special attention in fragile states – using integrated approaches by maximization and capitalizing on post-Lisbon Treaty capacities to play a role as a development leader.
Commissioner Piebalgs also said that the EC will progressively review regional development approaches to have more strategic, long term and customized partnerships.
Commissioner Piebalgs also mentioned the since published EU Financing for Development accountability report. On 19 April the European Commission published a report “Enhancing EU Accountability on Financing for Development: Towards the EU Official Development Assistance Peer Review – Annual Report 2011″ which assesses efforts made by the EU Member States and the EC in 2010 to advance four major issues:
- Promote good governance in tax matters and fight illegal financial flows.
- Support international trade and mobilise private investments, remittances and other private flows for development.
- Increase aid and climate finance in line with commitments.
- Spend aid effectively, support debt sustainability in developing countries and create a more conducive international architecture for development.
The package will serve as the basis for the 23 May EU Foreign Affairs and Development Council’s Conclusions on EU Member States’ performance in meeting international development commitments.
In the meeting with MEPs, Commissioner Piebalgs said that EU progress in meeting ODA targets is unsatisfactory and he hoped Member States that are currently lagging behind in meeting their ODA commitments would be encouraged by their peers and see the cost-effectiveness of work to meet these targets now instead of having future spending on humanitarian aid or military operations that cost more.
In response to points raised by MEPs in the ensuing debate, Commissioner Piebalgs said that EU Member States-EC coordination and division of labour had improved on the ground in the instance of support to Haiti and that this experience would be furthered in Ivory Coast and South Sudan. But he said that getting all the machinery in place will take substantial effort and that there are two pre-conditions for success – Joint EU-EC programming cycles (which is likely to prove difficult to achieve) and common EU-EC joint strategy papers. He said the EC may put forward a legislative initiative on this based on provisions in the EU Lisbon treaty.
With regard to property ownership rights and support to the private sector, the EC will consider, in the context of its proposals to modernise EU development policy, also having a staff working document to have more details on the status of these issues. He said the EC will publish a staff working document on formalising the informal business sector in developing counties.
With regard to MEPs calls for EC proposals on transparency and extractive industries (like the Dodd-Frank legislation in the US, i.e. beyond country reporting to include project basis reporting to ensure companies pay taxes, comply with laws, etc), Commissioner Piebalgs promised to work on transparency. He said Commissioner Barnier seems to support his idea to have a legislative initiative in the autumn on full transparency on all EU activities in developing countries. So Commissioner Piebalgs (since he’s responsible for PCD) hoped to be able to put this proposal forward in 2012 (following an impact assessment). MEPs pushed him, saying two things were actually needed: the transparency/anti-corruption area that Commissioner Barnier is working on; and a separate initiative on conflict metals which they said Commissioner De Gucht is not working on. They asked Piebalgs to push Commissioner De Gucht to do so. Commissioner Piebalgs did not reply to this specific distinction, but said that he would be working on the transparency issue. Press reports indicate that European companies are lobbying the EU not to go beyond country-by-country financing reporting as more detailed reporting to identify exactly where particular mineral originate would be too difficult.
MEPs also asked about land and sea grabbing. Piebalgs said full transparency is needed here, but did not mention any specific legislative initiative.
An impact assessment is needed before concrete proposals on innovative financing can be put forward, he said. With regard to proposals for a financial transaction tax, the Commissioner said the EC would first wait to see how negotiations proceed on this issue in the G20. Just the day earlier, on 11 April, the EU Commissioner for Taxation gave a speech which covered financial sector taxation, corporate taxes, tax obstacles faced by citizens and, finally, CO2 taxation. By summer, the Commission will define its policy orientation on financial sector taxation. This will be based on a thorough analysis of the various options, of the ways to mitigate their main identified risks, and of their cumulative impact taking into account the ongoing regulatory reform of the financial sector.
There will also be an EC communication in 2012 on social protection Commissioner Piebalgs told MEPs.
In terms of the focus of EC aid, this should be on the most vulnerable and EU neighbourhood countries, he said, not on pockets of poverty in Middle Income Countries, though EU Member States could still support the latter.
