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Press Note: Development and Trade GAERC

The External Relations Council held a joint working session of Development Ministers and Trade Ministers, with the participation of Commissioners Peter Mandelson (Trade) and Louis Michel (Development and Humanitarian Aid). Important results were achieved after several months of preparations by trade and development experts.

"This meeting was important", said Paula Lehtomäki, Finland's Minister who chaired the session, "because we must make EU policies work coherently in support of each other, in order to tackle the problems of poverty and hunger in developing countries".

Aid for Trade

The Council agreed that the EU should move ahead with pledges made last year to make EUR 2 billion available annually by 2010 for "Aid for Trade". This is the EU response to a WTO report on Aid for Trade that was adopted only last week. The Council agreed that delivering this aid should not be linked to the progress of the Doha Round.

Aid for Trade aims to support developing countries' capacities to take advantage of new trade opportunities that result from changes in trade rules and globalisation. Making trade rules more favourable in theory is not enough if countries cannot increase trade in practice. EUR 1 billion will come each from the Community and collectively from Member States. These funds will be earmarked for a category of projects known as "trade-related assistance". Ministers and Commissioners agreed to coordinate their spending in order to have maximum impact.

An important aspect of the agreement was the commitment to earmark a substantial share of the "aid for trade" effort to support the Economic Partnership Agreements (EPAs) currently being negotiated with the 79 African Caribbean and Pacific (ACP) states with whom the EU has concluded the Cotonou Partnership Agreement until 2020. These funds come on top of the EUR 22.7 billion that Ministers agreed for the European Development Fund (EDF) last June for the period 2008 2013.

This is a brief summary of the full text which is available on the Council's website http://www.consilium.europa.eu/cms3_fo/showPage.asp?id=1129〈=en

Development Cooperation Instrument (DCI)

After almost two years of hard and constructive work with the European Parliament, the Council confirmed its political agreement on the content of one of the EU's most important tools for funding its development cooperation activities.

It is important for three reasons. Firstly, it comes with a budget of almost EUR 17 billion for the period 2007 2013. These funds (previously decided) are in addition to the EUR 22.7 billion already agreed for the specific group of ACP countries last June - bringing the total of EU funds (excluding Member States' national budgets) to almost EUR 40 billion. Secondly, it plans actions at two, mutually-reinforcing levels. The first is geographic - there will be a programme for five regions of the world. The second is thematic - this means that the regional programmes can be reinforced in response to specific needs, such as migration, education, health and so on. ACP countries can also benefit from these thematic programmes. In particular, there is a special amount earmarked for the ACP countries that need assistance in adjusting to the EU sugar sector reform. Thirdly, it greatly simplifies the old system by replacing a series of instruments by a single one. This means that the EU's actions will be more coherent, all based on the same principles and will follow an easier decision-making procedure. Technical and procedural work will now continue in the Council and Parliament to ensure that this Regulation will be signed in December to come into force on 1 January 2007.

Foreign and Development Ministers

Development Ministers joined Foreign Ministers for two items

Other results and agreements

The Council also agreed texts on

These texts are available on the Council's website.
http://www.consilium.europa.eu/cms3_fo/showPage.asp?id=1129〈=en

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ANNEX: BACKGROUND INFORMATION ON THE DEVELOPMENT COOPERATION INSTRUMENT

Geographical Programmes

• Geographical programmes are the preferred instrument for cooperation with third countries. However, in some circumstances geographical (country, multi-country and regional) programmes are not the best instrument for action in a particular domain: some policy objectives cannot be achieved through country and regional programmes and/or some of the action under the country and regional programmes can be effectively supplemented by thematic programmes.

Thematic Programmes

• Food Security: Food insecurity is enshrined in the first Millennium Development Goal (to halve, between 1990 and 2015, the number of people suffering from hunger). It is now estimated that 815 million people are 'chronically' food insecure in the developing world, with a further 5 10% of the population at risk from 'acute' food insecurity driven by natural and man-made crises. In 2005, 43 countries were facing serious food shortages, 23 of them in Africa and others in Asia and Latin America. DCI establishes a new long-term structural approach to tackling the root causes of food insecurity.

• Investing in people: Human and social development is about people: people's needs drive and people's opportunities determine development, growth, security and poverty reduction. It is a key strategic element of "The European Consensus" and strongly emphasised in the Community's international commitments such as those under the Millennium Declaration and those agreed at the Cairo International Conference on Population and Development, the World Summit for Social Development, the Beijing Platform for Action on gender equality and the September 2005 UN Summit. The thematic programme "Investing in people" will focus on the core themes good health for all; education, knowledge and skills; gender equality; culture; employment and social cohesion and youth and children. Under the thematic programme "Investing in people", considerable funds will be used for continuing the Community's long-standing commitment to support international efforts to confront HIV/AIDS, tuberculosis, malaria and other diseases.

• Migration: Migration is at the heart of the political debate in Europe, but it is also part of the developing countries' development process. The general objective of the thematic programme in the field of migration is to bring specific, complementary assistance to third countries to support them in their efforts to ensure better management of migratory flows in all their dimensions. The thematic programme on migration will support, inter alia, the implementation of measures which have a positive impact on the link between migration and development, in particular encouraging the contribution of diasporas to the development of their country of origin and increasing the value of migrants' return; mitigating brain drain and promoting the circular movement of skilled migrants; facilitating the financial transfers of migrant workers (remittances) to their country of origin; supporting voluntary return and reintegration of migrants and building capacities for migration management.

• Non-state actors and local authorities in development: Under this thematic programme, initiatives proposed and/or carried out by civil society organisations and local authorities originating from the Community and partner countries in the area of development will be co-financed. This programme is intended to be the successor of both the current NGO co financing and decentralised cooperation programmes. It is "actor-oriented" instead of "sector oriented". It will support stakeholders' "right of initiative", by providing financial resources for their "own initiatives". At least 85% of the funding will go to non-state actors, including NGOs. Moreover, funding will also be provided to local authorities. These are much closer to the citizens than other public institutions and can facilitate citizens' immediate involvement in the development process, facilitate interaction between citizens and the state and build bridges between the Community and partner countries' citizens.

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