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The European Union and Development

The European Union (comprising the European Commission and the 27 Member States) provides over half (57%) of the world’s Official Development Assistance (ODA), some €46 billion or £36 billion. The European Commission alone manages 17% of this figure directly, making it the second largest aid donor in the world (after the US).

In 2006/7 the UK provided £964 million to the European Commission for development assistance. The UK contributes 17% of the European Commission’s main budget and will provide 14% of the 10th European Development Fund (EDF), which provides assistance to African, Caribbean and Pacific (ACP) countries. DFID’s contribution to these programmes totals some 21% of DFID’s overall aid budget.

As the world’s largest development donor, the world’s largest humanitarian aid donor, the world’s largest single market, the main trading partner of most developing countries, and a policy leader in issues vital to developing countries, such as global warming, Europe has an unrivalled importance in development policy and implementation.

In June 2008 the EU again showed its leadership on development when European Heads of State signed up to an ‘Agenda for Action’ that sets milestones to be achieved by 2010 in order to accelerate progress towards meeting the Millennium Development Goals by 2015.

For all these reasons it is important that DFID maintains strong links with the EU at all levels, influencing development policy, budgeting and implementation in line with the UK Government’s priorities. This importance is reflected in the 2006 White Paper, Making Governance Work For The Poor.

In the summer of 2008, DFID published an Institutional Strategy Paper, Europe for Development: Working with the European Union (787kb), which sets out a broad range of objectives and milestones for improving the quality and effectiveness of EU aid, for harmonising EU aid with broader development policies, and for using the EU’s political leverage to influence other multilateral agencies and regional groupings.

• Read more about DFID's work with the European Union

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The main institutions of the EU are:

• The European Council – meetings of Heads of State or Government, which set broad goals for the Union.
• The European Commission is the main source of new legislation and proposals.
• The Council of the European Union represents the Member States at the level of individual ministries and jointly agrees legislation and budgets.
• The European Parliament represents the EU’s citizens and jointly agrees legislation and budgets with the Council of the EU.

EC development policy and implementation is shared across several Directorate-Generals:

• The Directorate-General for Development and Humanitarian aid (DG Dev) formulates development policy and is in charge of programming and relations with the Africa, Caribbean and Pacific (ACP) countries.
• DG External Relations (RELEX) is in charge of programming and relations with Asia and Latin America as well as countries in the European neighbourhood.
• EuropeAid deals with implementation of almost all EU assistance to third countries.
• DG Trade develops the EU’s trade policy, negotiates on behalf of the EU and manages its diverse trade relations.
• DG Enlargement develops and manages the EU’s policy towards candidate and potential candidate countries.
• European Community Humanitarian Office (ECHO) manages humanitarian aid.
• European Commission delegations –One hundred and twenty-three delegations worldwide serving 155 country programmes.

Key documents on EU aid policy are:

• The European Consensus on Development (2005) sets out objectives and priorities for EU development aid.
• Policy Coherence for Development (2005). Aid alone is not enough to help developing countries reach the MDGs. PCD enumerates 12 wider policy areas which need to be brought into alignment with development strategy, including trade, the environment, agriculture, migration.
• EU Strategy for Africa (2005)
• Sustainable Development Strategy (2006)
• Energy Policy for Europe (2007) integrating energy policy with development policy.
• European Consensus on Humanitarian Aid (2007)
• Gender Equality and Women's Empowerment in Development Cooperation (2007)
• Joint EU-Africa Strategy (2007)
• EU Aid for Trade Strategy (2007)

Recent reports include:

• First Annual Report on Policy Coherence for Development 2007
• EC Development Policy Annual Report 2008
• EU Donor Atlas 2008

Last updated: 5 August 2008