Commissioner Nielson's Speech on development aid to reach UN targets

Madam Chair, Ladies and Gentlemen.

It is a pleasure for me to join you here today to discuss an issue which is of great importance to me: how can we increase financing for population and development, in particular for the protection of the sexual and reproductive health and rights of those most in need? In my former capacity as Minister of Development Co-operation in Denmark, I took active part in the Cairo International Conference on Population and Development in 1994. The Programme of Action agreed at Cairo represents a major positive paradigm shift for the international community's approach to Population and Development. I am now saddened by the current efforts in some quarters to turn back the clock and to vanquish the concept of sexual and reproductive health and rights.

The European Commission, remains firmly committed to the Cairo principles and to ensuring adequate support for sexual and reproductive health. Over €1 billion have been committed since 1994 to support work in developing countries that is in line with objectives set out in the ICPD Programme of Action. Where possible we have found additional resources to target an ever-broadening range of interventions, and while other donors have decided to cut funding in this area, we will continue to keep reproductive and sexual health and rights high on our agenda.

Most of the EU Member States have also continued to support reproductive health. Indeed, the past year's lengthy discussions in Council and Parliament about the revision of the legal base for a reproductive and sexual health and rights budget-line demonstrated a strong commitment from our Member States and Members of Parliament to continue to uphold the principles agreed in Cairo.

You are all aware how dismayed I am at decisions taken by the US Administration to reinstate the Mexico City Policy and to cut funding for IPPF and UNFPA. I firmly believe, and I have said this repeatedly, that these kind of decisions will cause increased maternal morbidity and mortality and decreased contraceptive prevalence; they may also result in increased HIV prevalence and a rise in under-five mortality. Overall, they could have a devastating impact on economic and social development in general, and they threaten the progress we have made to empower women and achieve gender equality.

To match our words with deeds, we recently committed €32 million from the 8th European Development Fund for a programme that will be implemented by IPPF and UNFPA in 22 of the poorest African, Caribbean and Pacific countries, with the objective of improving the capacities of those countries to deliver basic reproductive health services to vulnerable and under-served communities. Furthermore, we are engaged in intensive dialogue with the ACP States on the provision of further support under the 9th European Development Fund.

Let me now say something about the Commission's role in coordinating the Member States' efforts to increase development aid to reach UN targets. In 2000, the European Commission elaborated a new development policy that has at its core an emphasis on eradicating poverty and sustainable development: this approach is one which is shared by the Union as a whole. In affirming the Millennium Development Goals and other internationally agreed development targets, we have committed ourselves to achieving a 50% reduction in the number of people living in extreme poverty by 2015 and a wide range of other targets for health, education, food security, gender equality, environmental sustainability and global partnerships.

In order to ensure that we achieve these goals, the worlds' leaders at their meeting in Monterrey (Mexico) in March agreed to revitalize efforts to mobilize resources for development including domestic savings, trade, direct investment, debt relief and official development assistance (ODA), and to use these resources more effectively. ODA is especially important in those countries that are least able to attract private investment, where it can support health care, public infrastructure and rural development. At Monterrey we recognized that a "substantial increase" in ODA is required, especially to the world's poorest countries. We also reaffirmed the United Nations' target of developed countries committing at least 0.7% of their GNP as ODA, and we committed ourselves to intensify efforts to harmonize operational procedures, to untie aid, to work with nationally driven and owned development frameworks, and to improve targeting of the poor.

The EU already contributes more than half of the developed world's ODA €26 billion in 2001 making it the biggest donor to developing countries. At the meeting of the European Council in Barcelona in March, EU Heads of Government welcomed the renewed commitment to increase this to 0.7% of GNP of ODA. Those Member States (NL, DK, SW, LUX, IRE) whose assistance has already reached this benchmark will maintain it at this level. The remainder have pledged to increase their ODA volume over the next four years so that a collective EU average of 0.39% of GNP will be reached by 2006, with each country committing at least 0.33% within its own budget allocation process. While these increases may seem modest, they should result in an additional €22 billion being made available between now and 2006, and an extra €9 billion a year from 2006 onwards. The Commission will strive to maintain an overview of the ODA position of all of the EU, and will highlight particular successes and failings as necessary. We will also seek to harmonise policies and procedures of the Commission and the different Member States in order to increase the efficiency of our aid.

With regard to the development funds that the Commission currently handles itself, I am pleased to tell you that our performance has recently improved significantly. Payments increased by 20% in 2001 compared to the previous year, commitments were spread more evenly over the year, for the first time since 1990 there was a decrease in the level of commitments remaining to be paid, and clearance of outstanding commitments speeded up.

The Commission has also made a commitment to ensure that at least 35% of spending is allocated to the social sectors. We expect to honor this commitment in 2002. In fact, for the Middle East, Asia and Latin America we expect to reach 40%. For the countries supported through the European Development Fund the figure is expected to be 25%, but in addition some 30% will be committed for macroeconomic budgetary support, most of which has direct social sector conditionality.

At Monterrey we acknowledged the central role of a country's own policies and strategies in achieving its economic and social development, and we expect national governments to take the lead in developing poverty reduction plans and sectoral strategies. To this end the Commission will wherever possible support sector programmes rather than specific projects with funds earmarked for social development, as well with our macroeconomic budgetary support.

For most of our development assistance it will therefore not be possible to precisely define how much is committed for sexual and reproductive health, since increasingly funds will be committed towards improving health outcomes in general. This is a different way of working from the past, and with health in particular a whole range of interventions outside the sector (for example improved water and sanitation, better food supply) can lead to improved outcomes. With this is mind we will take our place around the table with national governments, development partners and other organizations to discuss priorities and strategies. Of course, in these discussions we will expect a high priority to be given to reproductive health within national strategic plans and expenditure frameworks. We will work to make sure that this is the case and will carefully monitor progress through suitable indicators.

At the end of the day this will mean that we cannot any longer say how much we are spending on reproductive health, except where we have made specific EC commitments. We will, however, continue to make funds available for non-governmental organizations and other partners under our special thematic instruments such as the reproductive health budget-line.

Madam Chair, the 21st century has brought to a head several enormous development challenges: the widening gap between rich and poor, the threats to the environment at global level, dwindling natural resources and the AIDS epidemic amongst them. However, Monterrey represented a sea-change, with the commitment of the international community to a new global partnership for development. Achieving the Millennium Development Goals is not simply about improving the life of those in the less developed countries, but also making the world "a better place" for us all.

Thank you.

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