Financing of actions other than Official Development Assistance in countries falling under Regulation (EC) 1905/2006 (debate) 
President
The next item is the report by Mr Berman, on behalf of the Committee on Development, on financing of actions other than Official Development Assistance in countries falling under Regulation (EC) No 1905/2006.
Thijs Berman
I, too, am pleased that Mr Deva has taken a seat, for now Mrs Ferrero-Waldner will be able to hear me, which is a great relief.
This unprecedented economic crisis, which is biting hard, spells renewed disaster for developing countries. The crisis leads to a drop in prices for raw materials, fewer investments, less trade credit and less money being sent home by immigrants. Meanwhile, the gross domestic products of all the rich countries are dwindling fast, which means that the budget for development cooperation is also being decimated as this is 0.7% of GDP, or at least that is what it is supposed to be, and even then, most countries fail to live up to their promises.
This is the context of the discussion about the new policy instrument that is being held here. If Spanish students receive a grant to study in Latin America for a few months, or vice versa, then such an exchange is useful, necessary and desirable, but a project such as this cannot be exclusively financed with funds that are intended to fight poverty. Whilst EU funding in this area is to be welcomed, it is not fighting poverty. It is frustrating to have to withdraw projects like this simply because there is no legal basis on which to back them.
That is why we have been looking for a modest instrument with which the EU can implement policy in developing countries that does not, strictly speaking, fall within the scope of fighting poverty. A financial source and a legal basis that do not come under development policy will need to be found. The legal basis cannot, therefore, lie in Article 179 of the Treaty of Nice, because that is precisely the statutory basis for development policy that should be avoided here.
The EU's own interests - European students making study trips - may not be financed under Article 179. Moreover, the EU, when spending development funds, has to meet the criteria legally prescribed in respect of development cooperation, namely those of fighting poverty.
With a little bit of creativity, there are other sources. Extending the Industrialised Countries Instrument is an option which the Committee on Foreign Affairs has put forward and which is also backed by my own committee. What is also an option, though, is a combination of Articles 150, 151 and 170, education, culture and research. With this combined legal basis, the European Parliament would maintain complete codecision with regard to this instrument, and the money, about EUR 13 million at the moment, is not taken out of the development policy kitty. Neither is it taken out of the foreign policy kitty.
As rapporteur - and the Committee on Development will back me up on this - I cannot agree to Article 179 as the legal basis. If it was, this new instrument would become ineffective, seeing as its exact aim is to prevent development funds from being used for other purposes. There should not, therefore, be a legal basis for this instrument that could make this compulsory.
For this reason, I plead with the Group of the European People's Party (Christian Democrats) and European Democrats to withdraw its amendment as a matter of extreme urgency. It flies in the face of our shared desire to protect the budget for development cooperation, even in times of economic crisis.
Benita Ferrero-Waldner
Member of the Commission. - Mr President, first of all, I would like to confirm the undertaking I gave, on behalf of the Commission, to carry out the mid-term review of the financial instruments in 2009. This was in response to Parliament's request during the final negotiations on the instruments.
That review will take the form of a communication, accompanied by legislative proposals where appropriate. The adoption of the communication is foreseen for April 2009 and is included in the Commission's legislative work programme.
The review is about the implementation of the instruments. It should be distinguished from the other mid-term review currently underway - and also foreseen in the regulations - which relates to the programming documents and the strategy papers for 2011-2013. This new programming will give rise to a round of democratic scrutiny, as for the first programming exercise covering 2007-2010.
The two exercises are different, but they are complementary. It is important to fix issues related to instruments before the new programming period. The strategy and programming review will take place during 2009 in order to be ready in 2010 for democratic scrutiny by Parliament.
As regards the Development Cooperation Instrument (DCI), our preliminary reflections confirm an issue that will be at the core of the review: the legislative gap as regards non-ODA activities for countries covered by the DCI.
What are these non-ODA activities? They are of various natures, but the current four preparatory actions initiated by this Parliament give a good outlook on what we are talking about: cooperation with middle-income countries in Asia and Latin America, which is not covered by the DCI, and business and scientific exchanges with China and India.
On these kinds of activities, we agree with you on the need to have legislation to cover measures which promote EU concerns in DCI countries. This could be done either through a new legal instrument or through amending the existing Industrialised Countries Instrument (ICI) Regulation.
When we prepared the new external relations instruments in 2006, we agreed that they should also cover the external dimension of our internal policies. We agreed that this could be done under the legal basis for external actions. This represented a considerable simplification compared to the previous situation.
It will be difficult for the Commission to follow this approach. We consider that the legal basis must reflect the objectives and content of the instrument. We recognise that there is a problem with non-ODA activities. By their nature, such activities do not qualify as development assistance. Therefore, a proposal that deals only with such activities cannot fall under development cooperation - under Article 179, as you mentioned.
Given that we want to cover known ODA activities, it seems likely that Article 181a of the Treaty will be the most appropriate legal basis, since it covers economic, financial and technical cooperation. However, before making any proposal, the Commission will consider the question carefully in the light of the position expressed by Parliament. It would be helpful to have Parliament's position so that we can finalise our proposals before the elections, as we promised.
Finally, I see that the report calls for more resources. We will have to look into it. You know the very tight situation of Heading 4 of the financial framework. One could argue that emerging countries are in transition and that the current assistance envelope should accompany that transition - that is, with a gradual shift from the development focus to non-ODA activity. We will examine this as part of the review.
These are the Commission's initial considerations on the report that we are discussing today. We consider it to be a good basis for our common work, and I look forward to hearing what the Members have to say.
Vicente Miguel Garcés Ramón
Mr President, the Committee on Budgets believes that it is of the utmost importance that each of the budgetary instruments be clearly demarcated. Therefore, the most realistic option seems to be the creation of a new instrument for actions other than public development aid for countries falling under the Regulation.
From a budgetary point of view, the financing proposal from the Committee on Development does not appear to be adequate, as this money does not exist and these lines do not have funds allocated on a multiannual basis. There is funding for 2009, but not beyond that.
In any case, given that the financing of this new cooperation instrument must be compatible with the 2007-2013 financial framework, it is worth pointing out the importance of the mid-term review of the financial framework. This should allow an adjustment of the different headings' ceilings.
Nirj Deva
on behalf of the PPE-DE Group. - Mr President, I welcome very warmly the statement made by Commissioner Ferrero-Waldner just now, and I ask my political group to withdraw its amendment so that this report can go through. If not, I am in a rather difficult position, but I will have to support the Socialist rapporteur on this issue.
I have to say that I believe the development instrument is for development purposes. But if one looks at what the development instrument - particularly Article 179 - gives, even with all the constraints, the ODA instrument allows the promotion of museums, libraries, the arts, music in schools, sports training facilities and venues - all these count as ODA. But, of course, sponsoring concert tours or athletes' travel costs does not. Cultural programmes in developing countries, whose main purpose is to promote the cultural values of the donor, are not reportable as ODA. It excludes military aid but it does not exclude peacekeeping. It covers a wide variety of activities - even civil police work to supply and increase the capacity of training of policemen, the demobilisation of soldiers, monitoring of elections, removal of mines and landmines - all this is ODA.
So here we are asking ourselves, in this Parliament, how many angels are dancing on the head of a pin when, in fact, the main area of the work is covered by the ODA instrument. So, I welcome Commissioner Ferrero-Waldner's statement that Article 181a is there to make it possible to look for the funds to do what some of my colleagues are hoping to do.
Ana Maria Gomes
on behalf of the PSE Group. - Mr President, it is crucial to solve the current legislative gap concerning the financing of non-ODA actions in countries covered by the DCI. This proposal for an instrument to address this gap must preserve the DCI unequivocally as an instrument for ODA and it must allow for a clear separation between financial sources allocated to pure ODA development cooperation and those allocated to other types of non-ODA development cooperation with developing countries. This separation is a very relevant political message in itself and it would give proper visibility to the EU's development cooperation policy.
The new or revised instrument should also be sufficiently broad to cover a wide range of actions that do not comply with the OECD DAC guidelines, but which are crucial for the EU's cooperation with developing countries, for instance, the development of the Akkas gas fields in Iraq or cooperation on aviation security with India. This is why I am not in full agreement with the restrictive legal basis proposed. I fully back Commissioner Ferrero-Waldner in finding Article 181a, possibly, a more adequate legal basis, which would provide for these kinds of concerns that I am highlighting. However, I am not convinced either by the alternative presented by the PPE-DE Group amendment that we are supposed to vote on tomorrow.
Therefore, I hope that, under the guidance of our rapporteur, Thijs Berman, we may find more time to have a thorough discussion on this matter and consider what is the best legal basis, namely, the proposal made by Commissioner Ferrero-Waldner.
Toomas Savi
on behalf of the ALDE Group. - Mr President, I would like to thank Thijs Berman for his report. It points out an important aspect in development aid that the Commission should, in my opinion, seriously consider. Activities such as cultural, scientific and economic exchange programmes, citizen-to-citizen contacts or political dialogue are regrettably not covered by existing European legislation, those being just a few examples.
The European Union has set up numerous programmes and financial instruments under the auspices of different agencies, each covering only certain limited aspects of the problems that the developing countries are currently facing. I find that, without a central European Union agency and a comprehensive and coherent policy, the efforts that we are making to improve the situation in developing countries are not of notable extent.
We all agree that the purpose of the European Union development cooperation policy is to reach as many people in need as possible, but yet we have chosen a rather inconvenient path to that goal. At the moment, the European Union is both institutionally fragmented and legally hindered as far as development aid is concerned. This much appreciated report deals with the results of those deficiencies.
The European Union and its Member States have contributed immensely to the official development assistance and it should never be underestimated, but much remains to be done to increase the efficiency and effectiveness of the institutional framework as well as congruence of the legislation covering development aid.
Michael Gahler
(DE) Mr President, to be quite honest, I was somewhat surprised to find that the Berman report had already been drawn up and a proposal was being presented before the completion of the Mitchell report, the actual report that is to assess the experience gained with the DCI.
My fellow Member is right in terms of the substance of his proposal. Given the design of the DCI, the legislative gap was inevitable. I support the conclusion that a different instrument is needed to close this gap for non-ODA (Official Development Assistance) activities. I can conceive of both the alternatives he proposes in paragraph 3 of his report.
I should like to make it clear, however, that non-ODA actions are also relevant to a country's development: it is only the choice of legal basis that is in dispute. In my opinion, it is the rapporteur and his committee against the rest of the world in this regard. The Committee on Development opts for a narrow interpretation of Article 179 and must therefore resort to articles intended for domestic policies as a legal basis. The Committee on Foreign Affairs, the Committee on Legal Affairs, Parliament's Legal Service, the ECJ, the Council and the Commission all read Article 179 differently.
Therefore we, the Group of the European People's Party (Christian Democrats) and European Democrats, decided today not to withdraw this motion tomorrow, but to table an amendment to change the legal basis envisaged, nor shall we be supporting the postponement, as we agree that only the legal basis is at issue in this matter. I am therefore sure that we will achieve clarity in the matter tomorrow.
Corina Creţu
(RO) The report from our fellow Member, Mr Berman, offers a clear solution for plugging the gap in the legislative structure for financing external actions which are not an emergency and which do not come under the category of development actions as defined by the Development Cooperation Instrument.
Financing actions of this kind is important from a political perspective as it can ensure continuity of the European Union's presence in the countries and regions which have already gone beyond the initial development stage. However, it is vitally important that the funds used to finance these actions do not come from sources earmarked for development, but from different budget lines.
The purpose of the legislative proposal requested by this report is to encourage development and not to restrict it by reducing the funds available for development policies in favour of other measures. This is why it is vital for the distinction between actions provided for under the Development Cooperation Instrument's scope and those provided for by the new legislative provision to be reflected when determining the funds earmarked for financing them.
Mairead McGuinness
Mr President, firstly I would like to thank the rapporteur for this report. I endorse his first comment about the economic crisis, its particular impact on the developing world and, indeed, the fact that we are not reaching our target of 0.7% in aid. This is very regrettable because, when the developed world shrinks, the developing world really takes the brunt of it.
I came to this debate because I was anxious to hear the arguments about legal bases. It seems to me that, underneath all of this, there is a fear that the budget will be spread too thinly. Let us just call a spade a spade. Let me quote the comments made by an aid agency which contacted me today: 'While we support Parliament's request for a financing instrument for non-ODA activities in developing countries, we strongly believe that it must be established on a legal basis which is appropriate to the activities which it intends to finance. The use of Article 179 as the legal basis for non-development activities is clearly not appropriate and, as such, would contravene both the EC Treaty and the acquis communautaire. It also opens the possibility that, in future, non-ODA activities may be financed from budget lines which are intended for genuine development activities. We very much hope that the amendment will be withdrawn.'
So, as a member of the PPE-DE Group, I am here tonight to listen to both sides of this argument, but also to put forward some of the lobbying that I am receiving from very genuine people in the development area, whose concerns I need to address.
I repeat the point that, if we were awash with funds, our legal basis might not cause us so much grief. The difficulty is that we are not. There is concern among those involved with the development agenda - the focus of concern - who are fearful that the money available will be spread over too many activities. However, I remain to be convinced.
Paul Rübig
(DE) Mr President, Commissioner Ferrero-Waldner, ladies and gentlemen, I wish to discuss not the legal basis but the basis for survival. Small and medium-sized enterprises have a very special role to play in this. Creditworthiness is particularly important during financial crises, so that these enterprises can still obtain microcredit.
I wish to point out in particular that the instrument of microcredit has actually very much proved its worth worldwide and that, particularly within the framework of the WTO round, which is hopefully approaching the final stages, we should consider how to bring about the relevant trade facilitation for the affected families in these areas.
After all, prosperity is created where something is produced, where people can live off the proceeds themselves and feed their families. If, in addition, they manage to sell something, prosperity is assured. It is with this in mind that I hope development policy takes the right course.
Benita Ferrero-Waldner
Member of the Commission. - Mr President, after hearing all the different contributions, it is clear that the Members' main concern is the choice of the legal basis.
I stated in my introduction the direction in which the Commission seeks to go, but I will certainly be very happy to take up your suggestions also.
You know that we want the best development assistance for all countries, and this is the main thrust of our thinking. So let us work together in order to find the right solution.
Thijs Berman
rapporteur. - Mr President, I am not a lawyer, and I am not well versed in law, but I know that one should avoid stretching the interpretation of legal texts. That is my fear if we use Article 181a, because it talks about economic and technical cooperation, whereas we are talking about students who go abroad on exchanges between universities. It is a bit hazardous. I am not against this if the Commission sees it as a way out for the non-ODA activities we all deem necessary and important, and I will go along with it. Perhaps I am concerned because I am a journalist. I like texts and I take words seriously, which is the essence of Europe - its humanism, taking texts seriously and taking language seriously. You have to be very careful when using words, so Article 181a is a maybe, but I am not very happy about it.
I was happy, however, with the comment made by Mairead McGuinness, to the effect that she needed to be convinced. She is Irish, she has her convictions and she is firm in her principles, as indeed we all are. If it is impossible tomorrow to reach agreement on the right legal basis, then I would prefer to refer this back to my committee and to take time to decide on a proper legal basis, because we all know that non-ODA actions are necessary.
I thank the Commission for its comment that non-ODA actions will, over time, become more and more important in developing countries and in middle-income countries, etc. We all agree on their necessity, and we all agree on the need to find a legal basis. Some of us agree that Article 179 is not the basis we are looking for.
If I cannot reach agreement with the PPE-DE Group before we vote tomorrow at noon - which will be a pity - I shall ask for a referral back to my committee. I am ready to do that and I will do so when the amendment is voted on tomorrow. I would be very sorry if this is the position of the PPE-DE Group, because we all agree on the need to maintain development aid at the level it is today, and we all know that it is shrinking with the economic crisis.
President
The debate is closed.
The vote will take place tomorrow.
Written statements (Rule 142)
Angelika Beer  
The review of the new foreign policy financing instruments has revealed defects in cooperation with third countries, and so we propose reforming the industrial instrument.
The Committee on Foreign Affairs does not consider it desirable to limit the new legal basis for the instrument to a few areas of cooperation. In addition, the policy fields currently envisaged (culture, youth, research) are borrowed from European domestic policy and have not, up to now, been intended to define cooperation with third countries. This is just one of the uncertainties that worries the Committee on Foreign Affairs. What happens, for example, if, in the near future, it becomes desirable to cooperate with other countries in matters of climate policy? Do we have to create a new legal basis for the instrument each time? Do we mean to do that every time there is a change in the area of cooperation?
The reform of the foreign policy instruments is very important to us all, and so it should be made clear that we are not fighting against one another.
This is the only reason why the Group of the Greens/European Free Alliance, together with the second rapporteur from the Committee on Foreign Affairs, withdrew the amendment on Monday.
In terms of content, we believe our proposal is more far-sighted and that it is the one that enables a coherent foreign policy. However, this report is just a recommendation to the Commission. We shall see what it does with it.
Sirpa Pietikäinen  
Mr President, ladies and gentlemen, the European Union is the world's largest donor of development aid, accounting for 60% of all funding. The Union's central role as a key actor in development cooperation should be strengthened even further in the future.
In order to stabilise the economies of the developing countries and bring peace to them, it is vitally important that the Union keeps to its target to increase its share of development aid by 0.7% of GDP by the year 2015. This alone, however, will not be enough.
It is essential to achieve general coherence in development cooperation among the different institutions. Financial investment and projects intended to build infrastructure and for more satisfactory adherence to the notion of human rights need to be undertaken in such a way that they support one another. The EU needs to establish the necessary instruments for implementing coherent development policy measures.
The Union's current legal basis for development cooperation, however, is flawed in terms of legislation, and that is why I would like to thank the rapporteur for raising what is an important issue. Projects aimed at improving the transport, technology and energy sectors and the dialogue between the scientific community and NGOs are essential for the social viability of developing countries. The main goal of such projects is not, however, to foster economic development and prosperity in the developing countries, and they do not therefore meet the criteria for official development aid as set by the Organisation for Economic Cooperation and Development. In future, official development aid should focus specifically on the elimination of poverty and improving people's living conditions.
