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The European Trust Fund for the Central African Republic

European Commission - MEMO/14/483   14/07/2014

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European Commission

MEMO

Brussels, 14 July 2014

The European Trust Fund for the Central African Republic

The European Commission, Germany, France and the Netherlands are going to set up the first European Union Trust Fund, the aim of which is to promote the stabilisation and reconstruction of the Central African Republic (CAR). The Fund has been christened Bêkou, which means 'hope' in Sango, the language of the Central African Republic.

The scale of the political and security crisis in the CAR, the difficulties pertaining to infrastructure, the provision of basic services and the functioning of the administration call for international aid that is structured and tailored to situations of fragility and can be organised quickly and efficiently.

The new Financial Regulation authorises the European Commission to set up and manage European trust funds under an agreement concluded with other donors. These trust funds are designed to mobilise various sources of EU financing and to collect contributions from the Member States and from donors from non-member countries.

EU trust funds have been specifically devised for crisis or post-crisis situations, where experience has shown that the weakness of the national or local administrations combined with a sudden increase in the number of donors leads to disorganisation and a fragmentation of the response of the international community, thus hampering an effective and sustainable contribution to the reconstruction of a country. This fragmentation will be avoidable in the future thanks to such trust funds.

The creation of the Bêkou Fund takes into account the lessons learned from past crises and the need to better link the reconstruction/development programmes with the humanitarian response (Linking Relief, Rehabilitation and Development, LRRD) in order to build the capacity of the Central African Republic.

  1. What is innovative about this Fund?

This Trust Fund adds a new string to the European system's bow. It will make it possible to move beyond coordination between Member States and put in place a real joint organisation of both resources and expertise and implementation capacity.

Faced with a situation as difficult as that of the CAR, an aid orphan country in which all the technical and financial partners were already having very great difficulty in executing projects before the current crisis, this tool will streamline the intervention set-up, focus the human and technical resources deployed in the field and create a real joint dynamic.

  1. What are the advantages for the CAR government?

The Central African authorities receive support and also work with a pool of coordinated partners which can mobilise significant funds over a period of several years.

It will also help to streamline donor operations by:

reducing the administrative costs of coordinating international partners;

ensuring that aid is not fragmented and disorganised;

creating a defined framework for reaching compromises in the management of aid programmes;

reducing the risk of early withdrawal of international financing before the country's economy has had a chance to recover;

mobilising a critical mass of financing, which will make up for the limited means mobilised by each donor individually.

  1. What are the advantages for donors contributing to the Bêkou Fund?

The Fund offers donors a flexible and safe method of financing activities in the context of a multipartner partnership. It enables them to give form to and act upon their political commitment to resolving the Central African crisis without incurring prohibitive transaction costs. These donors also have the guarantee that the Fund will be managed by the European Commission, which will assume financial liability and act in accordance with the principles and standards applicable to the budget of the European Union.

  1. How will it be organised?

The Fund will be governed at two levels:

1- A Trust Fund Board consisting of the Member States of the EU and other donors will lay down the general strategy for the use of the Fund in association with the Central African authorities.

2- An Operational Committee will decide on the selection of projects, the implementing rules and the follow-up. The Fund will be managed by the European Commission.

It has been established for a maximum duration of 60 months in order to provide a medium-term response. The Trust Fund is open to all Member States of the EU that wish to help achieve the Fund's goals, and also to other donors.

  1. What is the LLRD approach?

The aim is to link emergency humanitarian aid actions, financed by appropriate but separate instruments, with simultaneous actions that will gradually promote the drivers of development in the medium and long term . For example, an LRRD approach makes it possible to bring food aid to the refugee camps while also tackling the local agricultural sector by supporting it with seeds and input to prepare the fields and thereby ensuring gradual self-sufficiency.

  1. What is the regional dimension of the crisis?

The arrival of tens of thousands of Central African refugees in border areas (Cameroon, Chad, DRC, Congo, etc.) could upset local balances. It is therefore necessary to act beyond the Central African borders:

to help the host communities manage the influx of refugees (food security, provision of essential services, management of land-related tensions);

to manage the disruption of the flows of nomadic herders, who are used to crossing the Central African Republic in the dry season and who are now stuck in Chad, and/or the Muslim herders who have had to leave their herds in the Central African Republic and flee the violence.


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