Summary: 5 March 2009, Brussels - The European Commission has committed €225 million to the Government of Zambia for a 6 year period (2009-2014) to support the country's efforts to improve the efficiency of its poverty-focused public programmes and to accelerate progress towards achieving the Millennium Development Goals (MDG). Zambia is the first country to sign this form of enhanced general budget support called "MDG Contract" to highlight the contractual nature of this predictable, long-term financial commitment and its focus on MDG-related results, most notably in health and education.
Louis Michel, Commissioner for Development and Humanitarian Aid, who signed the MDG Contract in Lusaka today, emphasised the significance of this new way of providing general budget support: "In the present financial and economic crisis it is even more important for developing countries to receive predictable, long-term aid that is aligned with their own procedures and policy priorities. I have made faster, better and more effective aid my top priority and I'm glad to see the people of
Zambia are now seeing the benefits of this action. With the launch of the MDG Contracts, the European Commission is successfully reinforcing its partnership with developing countries and making further steps towards becoming a centre of excellence for aid delivery," he said.
The Commission support to Zambia will contribute to improved public finance management, enhanced service delivery in the social sectors and the promotion of structural reforms that enable job creation and pro-poor growth.
The MDG Contract is part of the EU's response to fulfilling its political commitment to improving the effectiveness and predictability of aid and accelerating progress towards the MDGs. It will be more predictable due to a commitment horizon of six years that is twice as long as the common budget support agreements. It will provide a minimum, virtually guaranteed level of support each year as well reliable yearly disbursements following a pre-defined timeline. Up to 30% of the total commitment
is a variable component used as an incentive measured against MDG-related results, most notably health and education, as well as improvements in public finance management and macroeconomic stability.
Zambia will be the first out of seven African countries to benefit from an MDG Contract. Financing agreements with six other African countries (Mali, Mozambique, Zambia, Uganda, Burkina Faso, Ghana and Rwanda) will be signed in the very near future. Collectively they account for a total of €1.5 billion that corresponds to 42% of all general budget support commitments foreseen in the 10th European Development Fund national programmes.
The countries have been chosen on the basis of their demonstrated track record of good performance in implementing budget support, their commitment to monitoring and achieving the MDGs and to improving domestic accountability for budgetary resources as well as their active donor co-ordination mechanisms to support performance review and dialogue.
| Top |
European Union Member States
Alerts by email
Email this page
Print this page