Explanatory Memorandum to COM(2011)839 - European Neighbourhood Instrument - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2011)839 - European Neighbourhood Instrument. |
|---|---|
| source | COM(2011)839  |
| date | 07-12-2011 |
Article 8 of the Treaty on European Union (TEU) provides for the European Union (EU) to develop a special relationship with neighbouring countries, with the aim of establishing an area of prosperity and good neighbourliness at the EU’s borders. The European Neighbourhood Policy (ENP) was developed in 2004 and covers 16 partners to the East and South of the EU’s borders, namely Algeria, Armenia, Azerbaijan, Belarus, Egypt, Georgia, Israel, Jordan, Lebanon, Libya, the Republic of Moldova, Morocco, the occupied Palestinian territory, Syria, Tunisia and Ukraine. Under the ENP the EU offers its neighbours a privileged relationship, building upon a mutual commitment to values and principles such as democracy and human rights, the rule of law, good governance, market economy principles and sustainable development, including climate action. The policy also provides for political association and deeper economic integration, increased mobility and enhanced people-to-people contacts. The ENP is funded by a dedicated Instrument, the European Neighbourhood and Partnership Instrument (ENPI), which covers the 16 above-mentioned partner countries and Russia.
A number of major developments have taken place since the launch of the ENP and the ENPI.
Changes to the EU’s relationship with its neighbours and developments since the ENP was set up have been analysed and assessed as part of the ENP Strategic Review. As a result, a new ENP vision has been developed as outlined in the Joint Communication of the High Representative of the EU for Foreign Affairs and Security Policy and the European Commission ’A new response to a changing Neighbourhood’, adopted on 25 May 2011 and the Council conclusions adopted on 20 June 2011. The new approach calls notably for greater support to partners committed to building democratic societies and undertaking reforms, in line with the “more for more” and 'mutual accountability' principles, and provides the strategic policy framework for the EU relations with the neighbours.
Although the ENPI has been widely recognized as a successful Instrument to accompany the EU’s policy towards its neighbours, the ENP policy review and other assessments, lessons learned and public consultations have all identified a number of issues to tackle in the future by adapting the Instrument to make the EU’s response even more effective, in particular:
· Application of the “more for more” principle: This principle is the key aspect of the renewed Neighbourhood Policy. It provides for a much higher level of differentiation among partners, in line with their commitment to the jointly agreed values and objectives, and notably to the partnership with EU focussed on democracy and shared prosperity. Financial incentives for the most ambitious reformers are an important aspect of the new approach. As a policy-driven Instrument, the future European Neighbourhood Instrument (ENI) should reflect this key principle, especially for programming and allocating support to the partners.
· Complexity and length of the programming process: The current programming process includes a number of broad consultations and many other procedural steps, and takes on average 18 months. The length of the programming process undermines the relevance of assistance. The scope of the programming documents (Country Strategy Papers) under the ENPI follows the format used for development cooperation, which means making an extensive analysis of the situation in a given country and increasing the length of the process. For Neighbourhood countries, however, the reality is different and the country analysis for most partners (countries that have concluded an Action Plan or an equivalent set of joint objectives with the EU) is described annually in dedicated Progress Reports, which make the general part of the Country Strategy Paper redundant. There is therefore both the need and the scope to streamline, shorten and better focus the programming process.
· Scope of the Instrument: The scope of the ENPI as defined currently refers to the implementation of partnership and cooperation agreements, association agreements or other relevant agreements, promotion of good governance and equitable social and economic development. It also includes a very broad list of 29 thematic areas of cooperation referred to in a detailed manner and on an equal footing, which makes it very hard to ascertain the core objectives and the focus of the ENP. The programming reflects this broad-based approach and in a number of cases coherence between the policy and cooperation has been a challenge. The future legislative proposal for the ENI will help to better streamline the scope of the Instrument and strengthen links with relevant internal policies, while maintaining its current flexibility.
· Partly outdated implementation provisions and lack of coherence between the external instruments: The implementation section of the current ENPI Regulation is outdated in some parts and therefore no longer adequately reflects the way assistance in the Neighbourhood is implemented. There is also a lack of coherence between the implementation provisions of the ENPI and other external action instruments. Flexibility mechanisms can be improved to match the new policy context. In order to address these points and to achieve further harmonization and simplification, a separate horizontal framework regulation comprising all general and recurring provisions has been developed. This new horizontal regulation also covers the ENI implementation specificities. This will allow for updating the implementation provisions and address the lack of coherence between the external instruments. Moreover, the new horizontal regulation will contribute to an increased clarity of rules, efficiency and coherence of the Union action.
· Cross-Border Cooperation (CBC) provisions: The Cross-Border Cooperation has been a distinct feature of the relationship between the EU, ENP partners and Russia leading to implementation of joint initiatives with a common set of rules on both sides of the EU’s borders. The system is functioning relatively well, but consultations with stakeholders identified the need for some changes having an impact on the Regulation. These include extending geographical eligibility to encompass the important economic, social and cultural centres relevant to the proper functioning of the programmes; full application of ‘shared management’, involving Member States as signatories of Financing Agreements; specific rules for co-financing by partner countries and the specific status of Russia. Far-reaching changes will need to be made to the Commission Regulation laying down the CBC Implementing Rules, mainly with regard to management methods.
· Linkages with internal instruments/policies: The ENP provides for a gradual political association and progressive economic integration of the partners with the EU. EU internal policies and market economy principles are key references in this process. For Neighbourhood countries, a number of initiatives have a transboundary aspect which so far has been addressed only to a very limited extent. The notable exception is the Cross-Border Cooperation that allows for addressing common challenges and objectives through a single set of rules and through pooling resources from both the internal and external funding sources of the EU budget. In other areas, such as infrastructure, energy, transport, SME development and industrial cooperation including tourism, ICT, employment and social policy, migration and security, judiciary, fight against drugs, higher education, culture, research and innovation, environment, climate action[7], disaster resilience and cooperation on maritime affairs, there is scope to strengthen the links between internal policies and instruments and the ENP and the European Neighbourhood Instrument. In this respect, the ENI Regulation will promote complementarity, coherence and mainstreaming of EU priority policy areas, in accordance with the Europe 2020 Strategy, while remaining focussed on the main ENP objectives. The ENP gives partners the option to participate in EU agencies and programmes. The issue of long-term financing of ENP partners’ participation in EU agencies and programmes needs to be adequately addressed through, in relevant cases, a financial contribution from the ENI, including the establishment of appropriate, sustainable delivery mechanisms.
· Evolving relationship with Russia: Russia is the only beneficiary of the ENPI that is not covered by the ENP. As all other countries, Russia is entitled to benefit from both the bilateral, multi-country and cross-border ENPI funding. However, given the significant improvements in Russia’s fiscal position, there is less need for large volumes of financial assistance. Russia aspires to a relation of equals and has become a donor itself. As a result, in the period 2007-2013 the country received only marginal allocations under the bilateral envelope of the ENPI. Cooperation within the framework of multi-country programmes continues and follows the principle of co-financing by the EU and Russia. Most notably, Russia is co-financing CBC programmes. This reflects the changing position of Russia as a strategic partner where co-financed projects should be in both sides’ interest.
The future European Neighbourhood Instrument should be aligned to the new ENP vision and address the specific challenges and issues as identified above.
Contents
- RESULTS OF CONSULTATIONS
- BUDGETARY IMPLICATIONS
- General context
- Reasons for and objectives of the proposal
- WITH INTERESTED PARTIES AND IMPACT ASSESSMENTS
- Public Consultation on funding for EU external action
- Consultations in the context of ENP Strategic Review
- Stakeholder consultations on Cross-Border Cooperation
- Impact assessment
- 3. LEGAL ASPECTS OF THE PROPOSAL
- Subsidiarity
- 5. MAIN ELEMENTS
- Simplification
Consultations with interested parties
The legislative proposal on the European Neighbourhood Instrument is based on a broad consultation process. The process involved a public consultation on external funding carried out for all EU external action instruments and specific consultations held as part of the Strategic Review of the European Neighbourhood Policy and on the Cross-Border Cooperation. Consultations were also held on the future of EU development policy.
The Commission held a public consultation on future funding for EU external action between 26 November 2010 and 31 January 2011. This process was based on an online questionnaire accompanied by a background paper entitled ‘What funding for EU external action after 2013?’ prepared by the Commission and the European External Action Service (EEAS). The 220 contributions received in response to this public consultation reflect a broad and diverse spectrum representing the multitude of structures, views and traditions found in the external action community.
Most respondents confirmed that EU financial support provides substantial added value in the main policy areas funded by EU financial instruments for external action[8]. The criterion of EU added value was given by many respondents as the main driver for the future: the EU should leverage its comparative advantage linked to its global field presence, its wide-ranging expertise, its supranational nature, its role as facilitator of coordination and the economies of scale.
Nearly all respondents supported a more differentiated approach tailored to the situation of the beneficiaries and based on sound criteria to increase the impact of EU financial instruments. There was also wide support for conditionality based on the respect for human rights, minorities, good governance and diversity of cultural expressions, or on the quality of beneficiaries’ policies and their ability and willingness to implement them.
The European External Action Service held specific consultations with representatives of EU Member States and ENP partner countries as part of the Strategic Review of the policy, launched in July 2010. The consultations tackled financing of the ENP, notably under the European Neighbourhood and Partnership Instrument, and issues of the long-term ENP vision and medium-term policy objectives.
The consultations revealed that the ENPI was seen as a step change in the way EU assistance was delivered. However, they also identified the need for further refinement. Many Member States underlined the importance of improved coherence between the policy and financial assistance provided by the Instrument. Several respondents highlighted that allocations should be based on performance. Many stressed the importance of making financial support faster, more efficient and more flexible in responding to emerging needs.
Partner countries underlined the need to accompany economic integration, market opening and regulatory convergence with appropriate financial support. They also emphasised the importance of promoting foreign investment.
Specific consultations on CBC were organised with all stakeholders. The process was launched during a CBC Conference in Brussels in February 2011, and stakeholders were consulted on the future regulatory framework (including on the CBC Implementing Rules) on the basis of a questionnaire circulated in May/June 2011. The results reflect the need to adapt some provisions to improve the efficiency of the CBC. The aim of the suggested changes is to better reflect integration between EU foreign policy priorities with the EU Cohesion Policy, especially by further aligning the CBC on external EU borders to the European Territorial Cooperation (ETC) rules. Further consultative meetings took place on 20 September 2011 with Member States in Brussels and with all stakeholders in Budapest on 18-19 October 2011.
Public consultations on “EU development policy”
In addition, the Commission published a Green Paper entitled ‘EU development policy in support of inclusive growth and sustainable development’ and held a public consultation from 15 November 2010 to 17 January 2011. Many respondents underlined that ODA[9] constitutes only a fraction of funding for development, to be seen as a complement to domestically mobilised resources, foreign investments, trade and remittances. A request was made for greater coherence in EU development policy, especially with regards to middle-income countries. While joint programming of assistance was endorsed in principle, it should be introduced gradually starting with countries where it would yield demonstrable added value.
The proposal on the European Neighbourhood Instrument is based to a large extent on the results of these consultations. The main aspects that have been integrated in the revised instrument include differentiation and performance-based allocations, new approach related to programming and improving the coherence of the policy with assistance, amending Cross-Border Cooperation rules and provisions to improve the efficiency and flexibility of support.
A specific impact assessment for the future ENI was prepared jointly by the European External Action Service and the European Commission.
The impact assessment reviewed the following four options:
· Option 0: ‘No EU action’. The EU stops providing financial support through a dedicated Instrument for Neighbourhood countries;
· Option 1: ‘No change’. Cooperation with the countries concerned remains strictly in the framework of the existing ENPI Regulation;
· Option 2: ‘Adapting the current set-up’. The future legislative proposal should be based on the current ENPI Regulation with a number of substantial amendments, responding to the new policy context and specific objectives. Under this Option there are a number of sub-options referring to: the differentiation principle; the programming process; scope of the Instrument and coherence between policy and assistance; Cross-Border Cooperation rules; implementation provision, notably to allow for greater flexibility; linkages with internal policies and instruments and geographic scope of the ENI.
· Option 3: ‘Tabling a completely new Instrument’ with a different geographic scope and focussing on objectives broader than or different from those of the ENP.
In terms of the likely economic, social, environmental and other impacts of each of the options, the following has been acknowledged:
· Discontinuing EU action (Option 0) would substantially reduce and undermine the sustainability of impacts achieved so far. It would also negatively affect overall EU relations with ENP partners.
· No change of the current Instrument (Option 1) would lead to a number of positive economic, social and environmental impacts in partner countries;
· Amending the Instrument (Option 2) would enhance the positive economic, social and environmental impacts achieved under the current set-up and should yield an even more positive impact on governance, notably by applying the “more for more” principle.
· Tabling a completely new Instrument (Option 3) would have negative impacts notably on the coherence of EU action with the ENP objectives, and would undermine the EU’s credibility in the region.
Based on the analysis and weighting of the different impacts (global, economic, social, environmental), Options 0 and Option 3 were rejected as non-viable options that would yield positive impacts and help meet ENP objectives. Option 2 would have the highest potential to yield a positive impact and to adapt the current cooperation framework to the new policy context, ENP objectives and challenges identified through evaluations and lessons learned. Option 1 would be the second-best option to maintain current positive impacts, without however providing for meeting the objectives of the new ENP nor address the challenges and specific problems identified under the current set-up.
The preferred option is therefore Option 2.
Article 8 of the TEU provides the general thrust and the basis for the ENP. The legal base for the financing Instrument to support the ENP, the future European Neighbourhood Instrument, is Article 209 TFEU[10] and Article 212 TFEU.
In terms of subsidiarity, action at EU level brings essential added value, linked to a number of factors:
· In Neighbourhood countries where alignment to EU rules and standards, guidelines and measures is one of the key policy objectives, the EU is best placed to provide assistance. Certain specific support can only be provided at EU level, such as promoting economic integration with the EU internal market, access to the Schengen space or participation in EU programmes. Thus the EU is the leading cooperation partner in most ENP countries, a role widely recognised by Member States, international financial institutions and other donors. Helping EU neighbours to align with EU policies, rules and standards is a key driver for reforms in the ENP partner countries.
· With 27 Member States acting within common policies and strategies, the EU alone has the critical weight to respond to global challenges. Action at national level can be limited and fragmented, as projects are often too small to make a sustainable difference. Streamlining the work of Member States through the EU improves the coordination and effectiveness of EU action.
· At a time of budgetary restrictions, when several Member States have chosen to exit entire sectors of cooperation and withdraw their support from certain countries, the EU is able to play an active role in promoting democracy, peace, stability, prosperity and poverty reduction in its Neighbourhood. In this context, it makes more sense than ever from a purely economic perspective to channel aid at EU level where a real difference can be made. Working with the EU is also cheaper. Administrative costs are lower than the average administrative costs of the principal donors for bilateral aid.
The level of funding from the EU budget for the new ENI should reflect adequately the ambitions of the revised European Neighbourhood Policy.
Thus, the European Commission in its Communication of 29 June 2011 entitled “A Budget for Europe 2020” proposed allocating to the ENI € 18 182 300 000 (current prices) for the period 2014-2020.
To ensure its predictability, funding for higher education activities in third countries in the context of 'Erasmus for All' programme will be made available, in line with EU external action objectives, through 2 multi annual allocations only covering the first 4 years and the remaining 3 years respectively. This funding will be reflected in the multiannual indicative programming of the ENI, in line with the identified needs and priorities of the countries concerned. The allocations can be revised in case of major unforeseen circumstances or important political changes in line with the EU external priorities. The provisions of the 'Erasmus for All' Regulation (EU) No [--] of the European Parliament and of the Council establishing 'Erasmus for All'[11] will apply to the use of those funds.
A detailed estimated financial impact of the proposal is set out in the separate ENI Legislative Financial Statement.
Detailed explanation of specific provisions of the proposal
The key elements of the proposal (as compared to the current set-up) and their rationale are the following:
· Apply the principle of “more for more” and mutual accountability in line with the new vision of the ENP, notably through specific provisions on differentiation for financial allocations and for the programming process, as required;
· Address the complexity and length of the programming process in order to streamline, shorten and better focus the process, especially for ENP partners that have jointly agreed with the EU strategic priorities in Action Plans or equivalent documents;
· Streamline the scope of the Instrument, striking a balance between flexibility of the Instrument and focus on the policy objectives and key areas of cooperation;
· Adapt the implementation provisions and improve coherence between the external instruments;
· Improve the provisions on the Cross-Border Cooperation to facilitate effective and fast implementation of the programmes;
· Promote closer links with EU internal instruments and policies, including by stepping up cooperation with the Commission at the programming stage and, where relevant, promote mechanisms to pool funds from internal and external headings of the EU budget;
· Respond to the evolving relationship with Russia by amending provisions on Russia’s eligibility for ENI funding to reflect the specific status of Russia as an EU neighbour and strategic partner.
The proposal for the ENI includes provisions to simplify the instrument in a number of aspects. The scope of the Instrument has been streamlined by bringing down the 29 thematic areas that feature in the current ENPI Regulation to six specific objectives. A new, simplified programming tool for most of the neighbouring countries (Single Support Framework) has been introduced. This new programming document will be shorter than the Strategy Papers and Multiannual Indicative Programmes, will prevent duplication of information contained in the legal/political documents that underpin EU relations with its neighbours, and should help shorten the programming process, therefore reducing administrative costs. The new article that allows funds from the ENI and the relevant internal Heading of the EU budget to be pooled with a single set of rules for measures addressing notably cross-border challenges will substantially improve efficiency and reduce the administrative costs of implementing such measures.
A priority for the Commission in this new Regulation, as it is for other programmes in the context of the Multiannual Financial Framework (MFF), is to simplify the regulatory environment and improve access of EU assistance to partner countries and regions, civil society organisations, SMEs, etc., provided that they pursue the objectives of the Regulation.
To implement the new ENI Regulation, simplified and flexible procedures should lead to swifter adoption of implementing measures and swifter delivery of EU assistance, in particular in situations of crises or threats to democracy, the rule of law, human rights and fundamental freedoms, or natural or man-made disasters. Revision of the Financial Regulation, which has particularly substantial provisions on external action, will also help facilitate the participation of civil society organisations and small businesses in funding programmes, for example by simplifying rules, reducing the costs of participation and accelerating award procedures. The Commission intends to implement this Regulation using the new flexible procedures provided for in the new Financial Regulation.
Furthermore additional simplification will also be achieved through the development of one horizontal framework regulation comprising all general and recurring provisions, providing for increased coherence between the external actions instruments.