Increasing the impact of EU Development Policy An Agenda for Change European Commission

1. Increasing the impact of EU Development Policy An Agenda for Change European Commission

2. A fast-changing international context • Graduation • New actors • Population growth • Recent global shocks • ‘Arab Spring’ • Regional/ domestic vulnerabilities & conflicts • Economic growth has remained strong in developing countries but it has not been inclusive and sustainable => Increasing the impact of EU Development Policy - An Agenda for Change

3. Agenda for Change • Overarching objective: Poverty elimination in the context of sustainable development • policy priorities => • Human rights, democracy and other elements of good governance • Inclusive and sustainable growth for human development • 20% of EU Aid to support social inclusion and human development • 20% of EU budget to contribute to low-carbon resilient societies • principles for implementation => • Differentiation => concentrating grant aid on countries most in need • Concentration => on a limited number of sectors per country, to deliver best result • Improved coordinated EU & MS action => joint programming, cross-country division of labour, common framework for measuring and communicating results • More effective tools and aid modalities: Results framework, Modernised budget support aid modality, innovative ways of financing (Blending; EU Trust Funds) • Policy Coherence for Development

4. Principles of implementation • Differentiation Target resources where they are needed most to address poverty reduction and where they could have the greatest impact • MFF 2014-2020 DCI: 16 countries will be graduated from bilateral aid, they will still have access to regional and thematic support instruments • MFF 2014-2020 and 11th EDF: More bilateral aid funding will be channelled towards Least Developed Countries and other low income countries. • New types of cooperation and new partnerships with more advanced developing countries • Alternative frameworks of continued partnership and cooperation • Diversify aid modalities and develop other types of cooperation (e.g. loan-grant blending, technical cooperation, twinning, etc.)

5. Differentiated partnerships

6. Concentration Sector fragmentation: European Commission present in 10 sectors on average - ranging between 5 sectors (Mongolia) and 12 sectors (Burkina Faso) Sectors defined too broadly (e.g. “human and social development”; “rural” and “urban” development; “economic” and “political” integration…) EU activities will be focused on a maximum of 3 sectors per country Preliminary results EDF & DCI programming: 79% of N/MIPs have maximum 3 sectors

8. Enhanced coordination of EU & MS action Joint programming EU and Member States Preliminary data - Joint Programming overview • Based on partner countries' own strategies • Joint EU & MS multiannual programming documents with a sector division of labour + indication of financial allocations per sector and donor • synchronised with partner countries’ strategy cycles • open to non-EU donors committed to the process in a given country • Joint programming to take place in around 40 countries

9. More effective tools and aid modalities EU Framework for measuring and communicating results • Based on existing donor practices and experiences • Multi-annual Indicative Programming documents (MIPs) screened in terms of quality of expected results and indicators, as well as for link with RF • Finalisation of Results Framework: by September 2014 • First annual reporting on results: 2015

10. Modernised policy on Budget support • Communication adopted end 2011 • Main features: • Stronger link with the fundamental values of human rights, democracy and rule of law • Differentiation of contracts: Good governance and development contracts; State building contract; Sector reform contract • New fourth eligibility criterion on budget transparency and oversight • Systematic review of adherence to fundamental values • Establishment of Budget Support Steering Committee • Comprehensive risk-management framework for each country with BS

11. Increased impact through innovative financing for development - Blending • EU grants to unlock additional public and private financing to meet development challenges. • EU achieved global coverage – 8 regional blending facilities (last 3 operational in 2012). €400M EU grants blended with additional public & private resources in 2013 (€1.6bn since 2007) will lead to investments of €10bn (€40bn) in partner countries • Importance of Blending is increasing – expected to further increase, particularly under regional programmes. • Potential to catalyse private funding to be developed further– Support to local businesses is an area where it is taking place.

12. Creation of a new tool: EU Trust Funds • New legal tool to pool funds from EU Budget with contributions from MS & other donors (third countries, international organisations, private donors). • Commission chairs the Board; • More flexible decision making and implementation rules • Increased coordinated action • Increased impact of EU´s external assistance • Operational framework is in place

13. Improved Policy Coherence for Development • PCD is a treaty obligation (Art 208) "The union shall take account of the objectives of development cooperation in the policies that it implements which are likely to affect developing countries." • 5 priority PCD challengesTrade and Finance; Climate Change; Food Security; Migration; Security, • Strengthen country level dialogue and promote PCD in international fora

14. A new global agenda: post-2015 Brings two processes together: • The follow-up to the MDGs after the 2015 deadline • The follow-up to Rio+20 including mandate to develop Sustainable Development Goals (SDGs) The objective is to agree, by September 2015: • A single overarching framework, addressing poverty eradication and sustainable development together • It should be universal, i.e. applicable to all countries while taking national circumstances into account

15. Post 2015 agenda – The EU's vision • Commission Communication: “Decent life for all: Ending poverty and giving the world a sustainable future” (February 2013) • Council Conclusions: "The Overarching Post 2015 Agenda" (June 2013) • Commission Communication: “A decent Life for all: from vision to collective action” (June 2014); • General Affairs Council: "EU Council conclusions on a transformative post-2015 agenda" (December 2014) • Commission Communication: "Global Partnership for poverty eradication and sustainable development after 2015" (February 2015)