The big winners of the EU's new EDF

Earlier this month, EU foreign affairs chief Federica Mogherini and development commissioner Neven Mimica announced the full entry into force of the 11th European Development Fund -— the EU’s main aid instrument for African, Caribbean and Pacific countries. Amounting to 30.5 billion euros ($32.3 billion), the current EDF spans until 2020. Last week, Devex reported that despite representing only a modest increase compared with the 10th EDF, EU aid to ACP countries in the next six years seems on course to meet the policies and priorities set out by the Agenda for Change. A closer look at the aid programming of the top five recipients of the 11th EDF confirms such trends. With the notable exception of Ethiopia, EU development assistance in all five countries prioritizes good governance and sustainable growth — two overarching objectives put forward by the 2011 policy document. Further, EU funding is concentrated on a maximum of three sectors per country, except for fragile contexts such as the Democratic Republic of the Congo and Mali. As noted by the Overseas Development Institute, up to 80 percent of the 10th EDF’s geographic allocations were already targeted at least-developed countries and other low-income states. But by increasing financial support to most of its major recipients — all of which rank the lowest among all ACP countries on the Human Development Index — the EU seems eager to make aid differentiation even more prominent under the new EDF. Ethiopia (745 million euros) Already the single-largest recipient of EU aid, Ethiopia is slated to receive 745 million euros over the 2014-2020 period — an increase of 101 million euros compared with the previous EDF. This is evidence that despite concerns over the East African nation’s poor democracy and human rights record and restrictive NGO laws, Brussels continues to demonstrate great generosity to Addis Ababa. Although Devex analysis found that democracy and governance programming has never figured prominently in the EU’s aid portfolio in Ethiopia — the 10th EDF set aside only 49 million euros to democratic governance — it has now been completely written off from the country’s national indicative program. Instead, the EU has chosen to align its priorities with the government’s drive to fill economic and social infrastructure gaps. Mutually agreed priorities for the 2014-2020 period include sustainable agriculture and food security (252.4 million euros), roads and energy (230 million euros), and health (200 million euros). Boasting solid economic growth and an impressive performance toward the Millennium Development Goals, Ethiopia has accomplished great development strides over the past two decades — a situation that further encourages EU policymakers to stay the course with robust aid engagement. Tanzania (626 million euros) A “donor darling” since the late 1980s, Tanzania is poised to receive 626 million euros under the 11th EDF — the second-largest funding envelope of the mechanism. The country remains one of the world’s poorest nations, with more than 30 percent of the population living below the poverty line. Despite its aid dependency, Tanzania has the reputation for actively seeking ownership of its development efforts. As a result, the EU will continue to follow the lead of the Tanzanian government’s poverty reduction program through 270 million euros worth of budget support. Energy has emerged as a new priority in EU-Tanzania development cooperation, and will swallow up funds traditionally dedicated to the transport sector. Receiving only 20 million euros in the 2008-2013 period, the energy sector is expected to collect about nine times that sum by 2020. Meanwhile, the EU will maintain its long-standing commitment to Tanzania’s agricultural development by allocating 140 million euros to the improvement of rural productivity, food and nutrition security, and natural resources management. Burkina Faso (623 million euros) Enjoying privileged ties with the EU that date back to 1959, Burkina Faso secured the generous amount of 623 million euros under the current EDF. Political instability is however common in the landlocked country. Late last year, the army stepped into the power vacuum left by strongman Blaise Compaore. The promotion of good governance thus constitutes a major pillar of Burkina Faso’s national indicative program, and is set to absorb more than half of total EU aid under the EDF. Special attention will be paid to the strengthening of public finance management. After significant investments in large infrastructure projects, the EU has also decided to refocus most its efforts on speeding up the country’s progress on the MDGs. Up to 270 million euros will be pumped into the sectors of health, food security, sustainable agriculture and water. Democratic Republic of the Congo (620 million euros) With the eastern provinces still embroiled in violent conflict, the Congo is set to remain a priority within the EU aid portfolio in the foreseeable future. Reflective of the EU’s push to focus more aid on fragile and conflict-affected states, assistance to the resource-rich African country will reach 620 million euros over the 2014-2020 period. Peace and stabilization have always been clear priorities in Brussels’ relations with Kinshasa. Decades of dictatorship and regional wars have left the Congo in dire straits, prompting the EU to sustain its support to crucial areas such as governance, infrastructure, health and environment — all of which will receive 130 million to 160 million euros under the 11th EDF. In particular, long-standing criticism by humanitarian groups such as Médecins Sans Frontières of the donor community’s lack of long-term solution to the Congo crisis seems to have encouraged the EU to enshrine health care in an approach linking relief, rehabilitation and development. Mali (625 million euros) As it continues to recover from a deep political crisis triggered by an Islamist occupation of its northern regions in 2012, Mali can count on increased support from the EU. Under the 11th EDF, Brussels has brought its assistance to the impoverished West African state up to 615 million euros — or 82 million more than the last EDF — an illustration of renewed long-term commitment. To pave the way for sustainable reconstruction, the 2014-2020 national indicative program will target areas that are vital for development and stability, such as state consolidation, agriculture and food security, education, and infrastructure. In the meantime, hopes are high that Bamako’s long-running decentralization process, which has been dragging on for more than 20 years, will be given fresh impetus. Check out more funding trends analyses online, and subscribe to Money Matters to receive the latest contract award and shortlist announcements, and procurement and fundraising news.