PAF - ProActive File
Regular News Update From Eurostep

No. 138     Friday, 25 June 1999

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1. EU COOPRERATION FUNDS TO BE SLASHED IN FAVOUR OF RECONSTRUCTION IN KOSOVO – GRANTS FOR NGOs TO BE CUT BY 8 MILLION EURO

According to the European press, EU co-operation projects with Russia, the former Soviet Union and the Mediterranean countries are set to be cut by up to € 200 million next year to raise money for rebuilding Kosovo. In order to meet the € 1.5 billion needed over the next three years to help resettle refugees in the region, the EU’s Tacis programme(assistance to Russia) and the MEDA programme (Mediterranean) are set to lose € 100 million, i.e. 10% of their total funding for 2000. Programmes for Latin America and Asia are also facing cuts. In addition grants for NGOs are set to be cut by €8 million.

Though the main impact of the cuts will be felt next year, the Commission is already looking for areas in which savings could be made in 1999. € 150 million is needed this year, if the EU Foreign Ministers’ agreement to provide immediate assistance for refugees is to be realised. EU finance ministries are also discussing ways of changing the EU’s 2000 budget in order to save € 500-700 million for the costs of restoration. This proposal even has the support of France and Spain who traditionally attach great importance to projects in the Mediterranean. However one diplomat predicted that southern EU countries might put pressure on their northern colleagues to further cut the budget for the Tacis and Phare (Eastern Europe) programmes in order to protect the Mediterranean programme. EU Governments are still debating whether to cut spending by 10% across the board or slice € 100 million each off allocations for Eastern Europe and the Mediterranean and then take 10% off from all other areas covered by the external relations budget. According to EU Foreign Affairs Commissioner the EU, Hans van den Broek, the EU would be footing half the total cost of rebuilding Kosovo (estimated at € 1 billion a year for the next three years) The precise cost it to be determined by a special evaluation mission. Once the exact figure is known, proposed changes to the 2000 budget will be presented to the EU Finance Council (16 July) which will discuss the Commission’s spending proposals for next year. A final decision on the 2000 budget is not expected until December after negotiations between the EU institutions.

The Eurostep General Assembly sent a statement, two weeks ago, to the incoming President of the European Commission, Mr Prodi, as well as to the President in Office of the EU Council, Gerhard Schröder stating that, while Eurostep recognises the need for financial resources from the EU and other OECD countries for reconstruction in the Balkans, these resources must not be taken out of ODA earmarked for Africa, Asia and Latin America. (See PAF 135) At subsequent meetings with ACP ambassadors and EU Permanent Representatives, Eurostep have emphasised that funding for the Balkans should not be made at the expense of funding for the new ACP-EU agreement.

2. COMMISSION MEETING WITH CIVIL SOCIETY ORGANISATIONS TO DISCUSS EU PROPOSALS FOR WTO ROUND

The European Commission held a meeting on 22 June with civil society organisations, MEPs and EU Member State representatives as part of its process of engagement with the civil society in the build up to the WTO New Round of negotiations. At the meeting NGOs put out a statement expressing their dissatisfaction at how the process of engagement has been managed by the Commission. Amongst the complaints were that: a) there is a lack of clarity in the EC’s objectives in the process; b) there is no mechanism to evaluate how far NGO concerns have been taken into account in the EC’s position; c) the organisations of meetings have been ill co-ordinated without proper consultation with NGOs; d) information provided at the meetings is often selective and unreliable.

Speaking on how the EU hoped to help developing countries in a new round, acting EU Commissioner for Trade, Sir Leon Brittan, said, inter alia: 1) The round should improve market access for developing countries. 2) The EU would be calling on all industrialised countries to give duty free access to the least developed countries by the end of the negotiations. 3) The EU would be advocating for greater support for developing countries in implementing WTO rules. 4) The EU would be calling on all developed countries to consider how to operationalise the WTO’s Special and Differentiated treatment for developing countries. 5) The EU would be calling for greater coherence of trade and financial policies through better co-operation between the WTO and the International Financial Institutions.

When asked about the Commission’s failure to present its report on the problem of incoherence of its policies relating to development and the Common Agricultural Policy in the development of the EU mandate for the WTO negotiations, he said the Commission would be given serious consideration to the issue.

Mr P. Carl of the Commission later announced that a more specialised meeting on agriculture with civil society would be held in the future. The Commission will be finalising its position on the new round in the coming two weeks. This will then be sent to the EU General Affairs Council in July (See table below) However, after the Commission’s proposal has been sent to the Council, there will still be room for NGOs to influence the EU’s position before and during the negotiations. The Commission will be holding more focussed meetings with civil society on specific issues relating to the negotiations. Meetings in the future might be held ‘back to back’ in order to save the travel costs of civil society organisations. He called on civil society organisations to send their position papers on the issues concerning the WTO round to the Commission as soon as possible. In the near future the Commission will designate one person in the Commission as the contact point, to whom all papers should be sent.

3. ACP-EU NEGOTIATIONS

At the latest round of the ACP-EU Negotiations for a new framework agreement at ambassadorial level this week, only the Central Negotiating Group (Political and Institutional issues) met. According to an EU official there was not much movement in the negotiations, Discussions were dominated by the question of including the concept of ‘good governance’ as one of the ‘essential elements’ of the next agreement.

According to the EU official, not much progress was made either in the negotiating group on trade, which met last week. Apparently the Commission has significantly hardened its position on Regional Economic Partnership Agreements (REPAs), presenting this as the only EU option for future trade arrangements. The Commission is now saying the only way it can guarantee or improve the ACP’s market access to the EU is through REPAs. It has also said that it could only consider meeting the ACP’s demand for improved preferences in the transition period if the ACP first accept to participate REPAs. It appears that some ACP countries are becoming more willing to consider REPAs, if the Commission provides for a longer transition period and more funds for adjustment.

The Group dealing with the Private Sector and other Development strategies will meet on 1 July. The Commission is set to present its proposals on civil society participation at this meeting. The group dealing with finance and instruments will also meet on the same day.

4. FINNISH PRESIDENCY OF THE EU (7-12/99) FORTHCOMING EVENTS

* Further dates for negotiations at ambassadorial level are yet to be set.

Updated on 25 June 1999
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