Increasing the Impact

of EU Development Policy

An Agenda for Change

CONTEXT

Lisbon Treaty (2009): poverty elimination in the context of sustainable development as one pillar of external action (Art.21 TEU); primary importance to PCD (Art.208 TFEU)

European Consensus on Development (2005): remains point of reference

Commitment to the MDGs (2000): Common EU Position and 12-point Action Plan (2010)

Commitment to aid effectiveness (2005): implementing the Accra Agenda for Action (2008); Code of Conduct on Division of Labour (2005); EU Operational Framework (2009-2010)

Sectoral and cross-cutting policies e.g. gender, environment, governance, fragility …

Policy Coherence for Development (2005) – PCD Work Programme (trade, climate, migration, security, food security)

Comprehensive partnerships, global presence: Cotonou, EU-Africa, Neighbourhood policy, EU-LA, Asia, etc

GREEN PAPEROn “EU development policy in support of inclusive growth and sustainable development”: Key results from the public consultation:

Poverty focus of EU development policyPartner country ownershipDifferentiated approach to partner countriesInclusive growth for poverty reduction incl. governance, health, educationEU comparative advantage in energy, infrastructure, agriculture, aid for tradeImportant EU role in good governance, security, human rights…EU commitments on PCD and aid effectivenessPrivate sector engagement with certain norms (e.g. decent work)Communication of results to secure political and public supportinnovative and private-sector financing

EU to work only in growth-enabling sectors or have a balanced portfolio that includes growth and social sectors? Only aid to Least Developed Countries?

AGENDA FOR CHANGEHigher impact of EU support and faster progress towards MDG

Concentration: Priority on Good Governance (human rights, democracy, …) Inclusive and Sustainable Growth for human development

using Climate change, agriculture and energy to drive sustainable

development Innovative financial instruments (blending…)

Differentiation: geographical focus towards countries most in need

Coordinated EU action

Improved coherence among EU policies

CONCENTRATION

Higher impact of EU aid by concentrating resources on a limited number of sectors

increasing the EU's critical mass

Max. of 3 sectors per country, among following policy priorities:

1. Good governance, democracy, human rights2. Foundations for inclusive growth (e.g. social protection, health &

education)3. Drivers for growth and job creation (e.g. business environment,

regional integration)4. Sectors with strong multiplier impact and contributing to

environmental protection + climate change prevention/adaptation (sustainable agriculture and efficient renewable energy)

1. HUMAN RIGHTS, DEMOCRACY, GOOD GOVERNANCEPrinciples Incentives for results-oriented reform EU general budget support should be linked to the governance situation and

political dialogue with the partner country mix and level of aid will depend on the country’s situation, including its ability to

conduct reforms Should a country loosen its commitment to human rights and democracy, the

EU should strengthen its cooperation with non-state actors and local authorities and use forms of aid that provide the poor with the support they need

Areas of action Democracy, human rights and the rule of law Gender equality and the empowerment of women Public-sector management Tax policy and administration Corruption Civil society and local authorities Natural resources Development-security nexus

2. INCLUSIVE GROWTH: Health, Education and Social Protection

Intensified policy dialogue and tool such as sector reform contracts (SBS) to:

health systems, reduced inequalities in access to health services, policy coherence, increase protection against global health threats and improved health outcomes for all

Quality education to give young people knowledge and skills and vocational training for employability

Decent work agenda, social protection schemes and floors and policies to facilitate regional labour mobility

3. GROWTH AND JOB CREATION: Business environment, regional integration and world markets

Competitive local private sector

Globally integrated markets, trade facilitation

Improving infrastructure

Leveraging private sector activity and resources for delivering public goods up-front grant funding, blending grants and loans and risk-sharing mechanisms to catalyse PPP and private investment

Regional development and integration, Aid for Trade, EPA

4. SUSTAINABLE GROWTH: Sustainable agriculture and renewable energy

Agriculture: sustainable, locally-developed practices, safeguarding of ecosystem services, smallholder agriculture, producer groups, supply and marketing chain, responsible private investment, nutritional standards, food security governance, reduced food price volatility at international level, climate change

Energy: price volatility and energy security; climate change, access to low carbon technologies, access to secure, affordable, clean and sustainable energy services, capacity development and technology transfer

DIFFERENTIATION

Target resources where they are needed and where they have greatest impact

Allocation of EU development assistance according to partner countries' needs, capacities, commitments and performance, as well as the potential EU impact

Supporting development in the Neighbourhood and Sub-Saharan Africa, as well as in fragile countries

Need for other types of cooperation and new partnerships with more advanced developing countries

Diversified aid modalities and develop other types of cooperation (e.g. loan-grant blending, technical coop, twinnings, etc.)

Development of partnership based on mutual interests with emerging economies and strategic partners

Accountability and transparency

COORDINATED EU ACTION

Joint programming of EU and Member States’ aid

Support to partner country’s strategy by developing joint multi-annual programming documents with MS synchronised with partner countries’ strategy cycles

Joint EU response strategies or donor strategies where possible, containing a sectoral division of labour

Joint action: single EU budget support contract, EU trust funds and delegated cooperation

Common EU results reporting framework

IMPROVED COHERENCE AMONG EU POLICIES

Policy Coherence for Development – PCD

Future Multiannual Financial Framework should reinforce PCD

New thematic programmes that build synergies between global interests and poverty eradication

e.g. joint approach to security and poverty or relation between development and migration.