Thursday, May 26, 2011

ENP Reform: Better But Still Not Looking At The Bigger Picture

EU Foreign Minister Baroness Catherine Ashton yesterday presented the Commission’s proposals for a revamp of EU aid to post-Communist countries, North Africa and the Middle East under the European Neighbourhood Policy (ENP). This review was certainly due: the recent upheavals in Tunisia, Egypt, Libya and Syria have unmasked several failures in the EU’s current approach, which we looked at in detail in a recent report.

To be fair, the Commission has some sensible ideas for ENP reform (some of which we also recommended), although it steers well clear of several “sensitive” big-picture issues that we think should be addressed as a matter of priority. But let’s start with the encouraging parts of the Commission’s proposals.

As we pointed out, the EU should put greater emphasis on “negative” conditionality when making decisions about funding. Aid must not only be frozen when a major crisis breaks out, such as in Libya. On the contrary, the Commission must make clear that it stands ready to pull the plug if a country fails to make progress on agreed democratic reform and human rights. The Commission states that, from now on, “for countries where reform has not taken place, the EU will reconsider or even reduce funding.” The question remains how this would operate in practice, as it will almost certainly face opposition from member states with vested interests in North Africa and the Middle East, notably France, Italy and Spain.

The Commission also says that “a stronger link” will be established between its annual “Progress Reports” and the amount of money these countries are granted. Again, this looks like a sensible suggestion. We show in our report that, previously, the Commission consistently increased its aid to countries like Egypt and Tunisia despite noting limited or no progress on human rights or democratic reform.

The EU will "suggest to partners that they focus on a limited number of short and medium-term priorities." We noted that the effectiveness of several ENP projects is undermined by the EU’s tendency to "attempt too much." Concentrating on a smaller number of priorities offers a far greater chance of success and, just as importantly, European citizens will find it easier to gauge the EU’s performance.

From our point of view, the most interesting part of yesterday’s communication is the Commission’s commitment to more closely monitoring its use of budget support. It is now pledging to take into account the "overall country situation regarding democracy, accountability, the rule of law and sound financial management." The fact this needed to be spelled out is of course rather shocking but better late than never.

The inappropriate use of budget support is a point we have consistently stressed: providing funding directly to the coffers of regimes, such as those in Tunisia and Egypt, which were clearly corrupt is no way to spend European taxpayers’ money.

However, despite some steps forward, the Commission has once again chosen to remain silent with regard to our suggestion of making EU member states’ contributions to the ENP voluntary. We have consistently argued that voluntary contributions would give an instant boost to the transparency and accountability of EU aid funding.

The Commission’s proposals on trade are also disappointing. Along with the over-used reference to the creation of a “Deep and Comprehensive Free Trade Area” with its neighbours, the Commission also says that “the EU will step up efforts” to conclude ongoing negotiations on the liberalisation of trade in agricultural products. This sounds way too vague and neglects the fact that much of this has to do with EU policies beyond the confines of the ENP. To truly honour this commitment would require a far greater openness to trade and an end to the distorting effects that the Common Agricultural Policy has on developing countries.

And, with their new powers gained under the Lisbon Treaty, MEPs are likely to continue prioritising the interests of European farmers – as they’re currently doing by withholding a free trade agreement on agricultural products with Morocco.

Finally, there's the question of migration. On this point, the Commission looks more than a bit confused. Ashton's report says that the EU will "pursue the process of visa facilitation for selected ENP partners and visa liberalisation for those most advanced." However, only a day earlier, EU Home Affairs Commissioner Cecilia Malmström put forward proposals for a "safeguard clause" allowing for the temporary suspension of the visa-free travel arrangements that the EU has in place with a number of third countries. Added to the current row over the border-free Schengen zone, the EU cannot credibly claim to have a coherent migration policy, which makes Ashton's proposals look like they will only create false hope.

Ultimately, until the EU comes up with a comprehensive strategy, which includes immigration, trade and reforming the CAP, reform of the ENP will remain a detail.

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