The European Commission has the exclusive right to initiate trade policy proposals and is the EU’s sole representative in trade negotiations. It has a “collegial” structure and is supported by different “Directorates General” (DGs) with responsibility for different areas of the Union’s policy. The EU’s mandate for external trade policy lies with DG Trade and that of Aid for Trade (AfT) primarily with DG Development and Cooperation - EuropAid (DEVCO). Other relevant DGs include: (i) Taxation and Customs (TAXUD): (ii) Health and Consumer Protection (SANCO) and (iii) Agriculture and Rural Development (AGRI).
The services of the European Commission work closely with the European External Action Service (EEAS).
More information on the European Commission: http://ec.europa.eu/index_en.htm
More information on DG DEVCO: http://ec.europa.eu/development/index_en.cfm
More information on DG TRADE: http://ec.europa.eu/trade/
More information on DG TAXUD: http://ec.europa.eu/taxation_customs/index_en.htm
More information on DG SANCO: http://ec.europa.eu/dgs/health_consumer/index_en.htm
More information on DG AGRI: http://ec.europa.eu/agriculture/index_en.htm
More information on EEAS: http://www.eeas.europa.eu/index_en.htm
Supporting developing countries’ integration into the world trading system is a development priority for the European Union, as expressed in the 2005 European Consensus on Development.
In October 2007, the EU Council adopted the EU Aid for Trade Strategy, a joint EU policy initiative “to support all developing countries, particularly Least Developed Countries (LDCs), to better integrate into the rules- based world trading system and to more effectively use trade in promoting the overarching objective of eradication of poverty in the context of sustainable development”. The Strategy is composed of actions organized under the following pillars:
Increasing the collective volumes of EU AfT within the ambitious development commitments to raise over- all EU aid gradually;
Enhancing the pro-poor focus and quality of EU AfT;
Increasing EU-wide and Member States’ donor capacity in line with globally agreed aid effectiveness principles;
Building upon, fostering and supporting ACP regional integration processes with an ACP-specific angle of the Joint EU AfT Strategy;
Supporting effective AfT monitoring and reporting.
Most recently in October 2011, in the “Agenda for Change” Communication the European Commission commits to scale up its support to enhance the business environment, promote regional integration and help harness the opportunities that world markets offer, as a driver for inclusive growth and sustainable development.
Moreover, in January 2012, the European Commission adopted a Communication on Trade, Growth and Development. The Communication stresses that the EU should focus its efforts on the poorest and most vulnerable countries and make sure those efforts are tailored to their needs and constraints, while ensuring coherence and complementarity between trade, development and other policies. It also calls for a better targeted Aid for Trade.
With respect to trade-related development funding, the EU is one of the leading providers of AfT. Concerning Trade-Related Assistance (Trade Policy and Regulation, Trade Development and Other Trade Related needs), in 2007 the EU and its Member States committed to an annual increase of €2 billion a year from 2010. This target was reached already in 2008 and 2009. In 2010, TRA from the EU and its Member States totaled €2.6 billion (€1.7 billion from Member States and €0.9 billion from the EU).
The total AfT (including TRA, Trade Related Infrastructure and Building Productive Capacity) commitment of the EU have constantly increased over the period 2004-2010 to reach an all-time high of €10.7 billion in 2010 (Member States committed €8.2 billion and the EU €2.5 billion). Africa accounts for the largest share of AfT from EU and Member States (€3.9 billion representing 38%). The majority of AfT flows to Africa was directed towards South of Sahara (80% of EU programmes and 60% of programmes financed by Member States). Flows towards Africa are followed by flows to Asia, Europe, America, and Oceania. AfT to the African, Caribbean and Pacific Group of States (ACP) has experienced a 41% increase since 2007, reaching €3.1 billion (29% of the total collective EU AfT) in 2010. Concerning AfT categories, the most substantial increases have been reported in Trade Related Infrastructure and Building Productive Capacity which represent more than 90% of total AfT.
As AfT is part of the EC Official Development Assistance (ODA), it is financed through the usual instruments under the regular EU budget and the European Development Fund (EDF).
The EU channels its AfT support through bilateral, regional and multilateral cooperation mechanisms, in general on the basis of programming documents (such as the Country Strategy papers (CSP) and the Regional Strategy papers (RSP)). The EU operates based on priorities expressed by partner countries during the programming process. These priorities are incorporated into the respective CSP and RSP, where trade, private sector, regional integration, agriculture can be articulated as main areas of cooperation. Alternatively, trade- related issues can be embedded in other focal sectors. Depending on the context, implementation modalities vary from the standard project approach in both centralized and decentralized management, to sector or general budget support and co-financing (joint management such as trust funds or delegated cooperation). Most of the implementation is decentralized to recipient countries and, on the EU side, is managed by EU Delegations in partner countries.
The European Commission systematically conducts an Aid for Trade Monitoring exercise. Besides quantitative aspects of AfT, the document shows the results of a qualitative analysis of AfT. The qualitative information is based on the views of EU Delegations and Member States’ embassies in partner countries across the developing world.
The European Consensus on Development:
Agenda for Change:
Communication on Trade, growth and development:
EU Strategy on Aid for Trade:
Aid for Trade Report 2012:
Principal official agency responsible for TCB assistance to developing countries
Web: EUROPEAID-info [at] ec.europa.eu
DG DEVCO is responsible for designing EU development policies and delivering aid through programmes and projects across the world. It incorporates the former Development and EuropeAid DGs. EuropeAid plays a crucial role in designing state-of-the-art development policy for all developing countries, enhancing policy coherence for development while further improving implementation and delivery mechanisms, defining future development policy within the EU, as well as contributing to the setting of standards internationally and to global challenges ahead. EuropeAid’s work is carried out with the ultimate aims of reducing poverty in the world, ensuring sustainable development, and promoting democracy, peace and security. As well as designing policies to achieve these objectives, Europe- Aid is responsible for implementing the EU’s external aid instruments. EU external aid is implemented by DEVCO staff in more than 80 EU Delegations around the world. Delegations design projects and activities, prepare annual programmes, tender for contractors and implement and supervise implementation.
EuropeAid coordinates the actions of the EU institutions, the EU Member States and other EU actors around the Union’s core values, objectives and common priorities. EuropeAid delivers aid through a set of financial instruments with a focus on ensuring the quality of EU aid and its effectiveness. An active and proactive player in the development field, EuropeAid promotes good governance, human and economic development and tackles universal issues, such as fighting hunger and preserving natural resources.
Other government and official agencies with responsibilities directly relevant to TCB
B-1160 Brussels, Belgium
The CDE is an ACP-EU joint Institution created within the framework of the Cotonou Agreement and predominantly financed through the European Development Fund (EDF). CDE’s mandate given in the Cotonou Agreement positions the Centre as an Institution dedicated to support private sector development in ACP countries.
CDE provides non-financial services to ACP companies and to joint initiatives of ACP and EU economic operators in various economic sectors, with the main aim to increase competitiveness of ACP enterprises.
CDE’s specific objectives are: (i) facilitating ACP-EU business partnerships; (ii) developing enterprise support services in ACP (capacity building with private sector organizations and service providers); (iii) assisting investment promotion activities and organizations; (iv) assisting technology transfer and management skills.
DG AGRI is responsible for the implementation of agriculture and rural development policy, the latter being managed in conjunction with the other DGs which deal with structural policies. It deals with all aspects of the Common Agricultural Policy (CAP) including farm support, market measures, rural development policy, quality policy, financial and legal matters, analysis and evaluation, as well as international relations relating to agriculture. The mission of the DG AGRI is to promote the sustainable development of Europe’s agriculture and to ensure the well-being of its rural areas. The mission will be achieved through: (i) promoting a robust and competitive agricultural sector which respects high environmental and production standards, ensuring a fair standard of living for the agricultural community; (ii) contributing to sustain- able development of rural areas, in particular through helping the agricultural sector to adapt to new challenges, protecting the environment and the countryside, and improving the quality of life in rural areas, whilst ensuring growth and jobs in the countryside; (iii) promoting the European agricultural sector in world trade.
DG SANCO is in charge of updating and ensuring proper application of EU laws on food safety, consumers’ rights and protection of people’s health. DG SANCO also manages international relations on food safety, animal health, welfare, nutrition and plant health with third countries, international organizations, the European Food Safety Authority (EFSA), and ensures science- based risk management.
Due to the impact of EU regulations on trading partners and regulators worldwide, DG SANCO policies loom large in the WTO and EU bilateral trade relations with many countries. The need to safeguard the EU against animal dis- eases remains a priority. Being EU the world’s largest food importer, food safety in third countries must be part of this challenge. The main areas of intervention are the following: (i) coordination of EU border inspections of food, plants and animals, to ensure common operating standards; (ii) a stronger push for animal welfare concerns to become a mainstream part of EU food chain policy; (iii) cooperation with Member States and economic oper- ators to implement the rules on hygiene and food and feed safety at a reasonable cost; (iv) cooperation among EU veterinary agencies, to combat animal diseases; (v) cooperation with and between EU laboratories to level up the quality of the supporting scientific work on all food chain health threats; (vi) a worldwide network of surveil- lance agencies, based on current cooperation within the EU, to ensure early warning of any real or potential food safety threats; (vii) training of Member States and third country regulators to ensure that local enforcement of EU rules is of a sustained high level of consistency. Part of DG SANCO is the Food and Veterinary Office (FVO), responsible for ensuring the proper implementation and enforcement of the Community legislation on food safety, animal health, plant health and animal. In terms of capacity building to Member States and third countries, in 2006 DG SANCO launched a training programme called “Better Training for Safer Food” (BTSF) to help ensure that everyone is competing on a level playing field and to make intra-EU trade easier.
The European Commission’s Directorate-General for Trade (DG TRADE) is in charge of implementing the EU’s common commercial policy. Its aim is to contribute to shaping a trade environment that is good for people and for business. This includes maintaining the global trade sys- tem and ensuring it adapts to a fast-changing world, creating growth and jobs for Europeans by increasing their opportunities to trade with the world, ensuring that trade is fair by making sure all trading partners play by the rules, helping developing countries trade their way out of poverty, and contributing to sustain- able development. DG TRADE’s responsibilities cover trade in goods and services, commercial aspects of intel- lectual property, investment, and other trade-related rules. DG TRADE works closely with the WTO and other multilateral institutions. It is responsible for negotiating multilateral and bilateral trade agreements and as such it is the main EU player in trade and investment negotiations with partner countries, including the Economic Partnership Agreements (EPA) with African, Caribbean and Pacific countries and Free-Trade
Agreements (FTAs) with other parts of the world. DG TRADE is also responsible for preferential trade schemes, notably the General System of preferences (GSP). In order to ensure coherent EU policies, DG TRADE works closely with many other services of the European Commission, including: DG Development and Cooperation on the Trade, Growth and Development Policy and the implementation of the Aid for Trade Strategy; DG Environment, DG Employment, Social Affairs and Equal Opportunities and DG Climate Action on sustainable development issues; etc. DG TRADE has close working relationship with the European External Action Service (EEAS), other European Institutions, notably the European Parliament and the Economic and Social Commit- tee, as well as with EU Member States.
DG TAXUD is in charge of developing and managing the Customs Union, a foundation of the EU, and developing and implementing tax policy across the EU for the benefit of citizens, businesses and the Member States. Particular attention is given to the Internal Market, by making sure it functions smoothly and efficiently.
The Directorate General works to provide solutions in the tax and customs fields to Member States and economic operators, thus enabling them to respond to current economic, social and environmental challenges, both at European and international level. More specifically the Directorate General’s activity aims at: (i) simplifying and modernizing the tax and customs administrative rules and procedures with which European economic operators have to comply; (ii) assisting Member States to apply correctly EU tax and customs acquis as well as monitoring the proper transposition and application of tax and customs legislation; (iii) managing and securing the common external border, combating the flow of illegal trade and reinforcing the security of the international supply chain; (iv) developing a coherent, modern and simple VAT system; (v) working towards a coherent direct tax strategy designed to limit distortions which arise from the interaction of the different tax systems of the Member States, with particular emphasis on company taxation and capital income; (vi) working at an international level to improve transparency and information exchange and to ensure coherence between taxation, customs and wider objectives of the Community particularly in the areas of commercial policy, development aid and “Wider Europe”; (vii) reinforcing candidate countries’ capacity to apply the customs and tax community acquis; (viii) adapting energy taxation to the needs of a low carbon economy; (ix) assisting Member States to combat fraud and tax evasion;
The EIB is an EU institution that finances capital investment projects in EU countries and in countries that have cooperation agreements with the EU. In developing countries, it concentrates its efforts on fostering private-sector-led initiatives that promote economic growth and have a positive impact on the wider community and region. It also supports public sector projects, typically in infrastructure, that are critical for private sector development and the creation of a competitive business environment.
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CTA is an ACP-EU institution working in the field of information for development. It operates under the ACP-EU Cotonou Agreement. Its mission is to advance food and nutritional security, increase prosperity and encourage sound natural resource management by pro- viding access to information and knowledge, facilitating policy dialogue and strengthening the capacity of agricultural and rural development institutions and communities in ACP countries. It focuses on three key areas: (i) agricultural policies in ACP countries; (ii) promotion of profitable smallholder value chains for marketable products and (iii) building ACP capacity in information and communication and knowledge management (ICKM). The CTA’s main partners are ACP national and regional bodies as well as a wide network of ACP-EU public and private sector bodies and international organizations around the world. CTA is funded by the EU.
Selected TCB programmes and initiatives in this guide
Multilateral Trading System Programme (MTS)
Technical Barriers to Trade (TBT)
Latin America Investment Facility (LAIF)
Central Asia Investment Facility (IFCA) and Asian investment Facility (AIF)
Neighborhood Investment Facility (NIF)
The EU collaborates with different UN and International Agencies in the trade capacity building activities. We can mention here International Trade Centre (ITC), WTO, EIF, OECD and ILO. Selected examples are given below:
International Trade Centre (ITC)
ITC’s mission is to enable small business export success in developing and transition-economy countries, by providing, with partners, sustainable and inclusive development solutions to the private sector, trade sup- port institutions and policymakers. The European Commission’s Directorate General for Trade (DG TRADE) has been cooperating with ITC for a number of years. It currently contributes to three projects carried out by ICT. The Market Access Map (MacMap) provides on-line information to developing countries on market access conditions in third countries. MacMap complements DG TRADE’s Export Helpdesk, which provides developing countries with information on market access conditions to the EU. The Standards Map organizes and disseminates information on private standards and related research to strengthen the capacity of producers, exporters and buyers to participate in more sustainable production and trade. Finally, the Small Traders Capacity Building Programme, launched in October 2012 on the initiative of the European Commission (€1 million over three years), will aim to help small traders in selected LDCs access the EU market.
Enhanced Integrated Framework (EIF)
The EIF is a multi-donor programme which supports LDCs to be more active players in the global trading sys- tem. It supports the formulation of diagnostic trade integration studies (DTIS), capacity building for policy formulation, and facilitates project preparation, appraisal and implementation – so-called Tier 1 projects up to $900,000 over three years. Tier 2 projects ($1.5-2 million, possibly up to $3million) focus on trade- related and supply-side activities and aim at assisting the implementation of Tier 1 projects. The EIF works on the basis of a multi-donor trust fund. The EU and its Member States (Belgium, Denmark, Estonia, Finland, France, Germany, Hungary, Ireland, Luxembourg, Spain, Sweden and the UK) are the largest contributors. The Commission has committed €10 million, including €4 from DG TRADE and €6 million from DG DEVCO.
WTO Doha Development Agenda Global Trust Fund (DDAGTF)
The DDAGTF was created in 2001 to provide a financial basis for the provision of trade-related technical assistance and training to developing and LDCs and low-income economies in transition. Its main purpose is to assist these countries to better understand and implement WTO obligations and to exercise their rights under the WTO agreements. The Commission (DG TRADE) has been supported the DDAGTF for several years, making an annual contribution of €1 million between 2009 and 2012.