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IP/04/63

Brussels, 16 January 2004

Commission approves co-operation actions for EUR 246 million in Latin America

The European Commission has approved funding of over € 246 million(1) for co-operation and external aid operations in various Latin American countries and sub regional groupings. This package of assistance illustrates the EU's commitment to support the consolidation of democracy and prosperity in Latin America. Brazil, Chile, Colombia, Ecuador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Peru and Uruguay, as well as Mercosur, Andean Community (CAN), Central America and Latin America as a whole, will benefit from this assistance. The sectors covered include: socio-economic development; strengthening, decentralisation and modernisation of institutions; sustainable and rural development; education; peace process in Colombia; displaced persons; strengthening of commercial capacities; fight against poverty; regional integration; and implementation of association agreements. These operations come under the 2003 National and Regional Financing Plans of the ALA Programme.

Commissioner Patten commented: "These new co-operation measures demonstrate the EU's engagement towards its Latin American partners, underlining that our strategic partnership is in good shape. They are the concrete implementation of jointly agreed priorities, including the need for further regional integration and greater social cohesion, which will be the two main priorities to be tackled at the May Summit of EU-Latin America and Caribbean Heads of State and Governments in Guadalajara."

Growing closer by the year, and underlined by commercial opportunities and shared economic and political objectives, relations between the EU and Latin America are also developing through concrete co-operation for development projects. The European Union (both the EU and its Member States) is the largest provider of Overseas Development Assistance to Latin America.

The concrete projects and initiatives being launched include:

Brazil (€ 7 million)

The project will implement for the first time in Brazil an innovative attempt at shifting the "traditional" paradigm of bio-diversity conservation from "biological islands" to "biological corridors", spanning large tracts of critically important areas some of which already enjoy some kind of protection status.

Chile (€ 22.2 million)

A first project of support for the creation and development of innovative companies, with an EU contribution of € 17.2 million, will help increase the competitiveness of the Chilean economy by supporting technological innovation and development in strategic sectors of the national economy (generic technologies) and its transfer and dissemination among companies, especially small and medium-sized enterprises. The project will help to improve the national and international competitive position of the Chilean economy and encourage strong economic growth rates.

A second project will facilitate the implementation of the Association Agreement on trade, economy and co-operation between the EU and the Republic of Chile, signed in November 2002. In order to achieve this objective, the creation and the implementation of an Operating Fund is planned, which will develop initiatives aiming to ensure the effective functioning of the Agreement. The EU contribution is € 5 million.

Colombia (€ 39.2 million)

In Colombia, Community assistance is given to the "Peace Laboratories", the concept of which arises from the existence of large movements of civic participation in favour of peace, which in some regions transformed themselves into social laboratories where paths for dialogue and coexistence are explored, as well as peaceful mechanisms to deal with the ongoing armed conflict. The attempt is to deactivate, through initiatives emerging from the social base, the root causes of the conflict, fostering a sustainable socio-economic development and a life with dignity for all the citizens in the three targeted regions. Building on the progress made so far with the first peace laboratory in Magdalena Medio, the second EU-funded (€ 33 million) peace laboratory will target the regions of Norte de Santander, Eastern Antioquia and the Colombian Massif, covering a total of 62 municipalities.

In addition, a € 6.2 million contribution will be provided to support the reintegration process and to improve living conditions of internally displaced people.

Ecuador (€ 17 million)

Ecuador is located strategically at the contact between three very important ecological areas: the Andes, the Amazonian region and the Pacific basin. Its geographical, biological and ethno-cultural diversity is exceptional. A project of Decentralised Natural Resources Management in the north of Ecuador, with a EU contribution of € 17 million, will improve the living conditions for the population of the three Northern provinces of Ecuador (Esmeraldas, Carchí and Imbabura) through the sustainable use and conservation of its natural capital, and the right to live in a safe environment. The project's goal is to facilitate the strengthening of a decentralised environmental management system administered by the Ministry of Environment, the provincial and the municipal governments, through institutional development and with social participation.

Guatemala (€ 20 million)

The € 20 million EU contribution for a decentralisation and municipal reinforcement project will contribute to the development processes set in motion by the Guatemalan state and society concerning democratisation and political multi-ethnic and multi-cultural cohabitation. The specific objective is to strengthen municipal institutions' general and sectoral capacity, and to manage the state's local public policies.

Honduras (€ 41.08 million)

As a support to secondary education, a € 28 million project will be directed primarily to the pupils and teachers of the most vulnerable groups in the country: those less favoured by development, marginal urban groups, rural women and youth, and bilingual ethnic groups. The vocational educational training centres that have been identified as reference centres will undergo remodelling, furnishing and technical improvements. Additionally, the programme will strengthen the institutional capacity of the Secretariat for Education in its functions of standardising the educational system and of administering the resources at its disposition.

Honduras will also benefit from an EU funding of € 13.08 million, representing the fifth and last part-payment of the Regional Programme for the Reconstruction of Central America (PRRAC), a huge programme launched in 1999 as a response to the disastrous hurricane "Mitch" which swept through the region.

Mexico (€ 15 million)

In the State of Chiapas, a region which presents the lowest Human Development Indicator in Mexico, especially among the indigenous population, an integrated social development project will put forward an innovative territorial strategy. Viable alternatives of production and income will be promoted, while participatory planning and access to relevant information will create renewed forms of local management and governance. The EU contribution is € 15 million.

Nicaragua (€ 33.161 million)

Three initiatives covering debt relief, institutional support and education as follows:

  • The fundamental goal of the World Bank and IMF Initiative for Heavily Indebted Poor Countries (HIPC) is to reduce the external debt to a sustainable level, together with a correction of the macroeconomic and fiscal imbalances to prevent such situation to re-emerge. Such debt relief has to be allocated as extra resources to poverty reduction in the framework of public expenditure programmes, structured through country-owned poverty reduction strategies. The EU funded "HIPC Debt Relief Support in the Field of Rural Local Development" plans to disburse € 7.5 million into the WB-HPIC fund on behalf of the Government of Nicaragua. This would have a direct impact in next year's budget and provide an average debt relief of € 1.19 million per year between 2004 and 2013.

  • An Institutional Support Programme to Development Policies, worth € 5 million, envisages the supply of technical assistance to the Government of Nicaragua to strengthen the development and implementation of Sector Policy Support Programmes (SPSP).

    This will involve support to central government entities, civil society and other donors. It also includes a contribution to the multi-donor trust fund designed to support the implementation, monitoring and evaluation of the Nicaraguan Poverty Reduction Strategy Paper.

  • Finally, the Education Sector Policy Support Programme (ESPSP), with a Community contribution of € 20.661 million aims at supporting the progressive development of Government capacity to design and manage its education policy. More specifically, the ESPSP will support the National Plan of Education and the decentralisation process of education to municipalities.

Panama (€ 6.65 million)

The Panamanian judicial system is characterised by its slow pace, the large number of persons under detention awaiting trial, and the excessive number of judgements overturned on appeal. On the basis of the strategic plan for the reform of the judiciary, prepared by the Supreme Court, an EU funded project (€ 6.65 million) will lead to a more efficient and transparent justice administration, improved Court facilities, an independent judicial career path and improved citizens' access to justice. These results are to benefit the Rule of Law and the democratic rights of the people.

Peru (€ 14 million)

14 million euros have been set aside for a programme which aims at contributing to the fight against poverty and, more specifically, the socio-economic development of the Ayacucho and Huancavelica regions. The AGORAH programme will run along two axes: strengthening of the local governments' management capacity and implementation of works (roads, electricity, irrigation, water sanitation, etc), the latter funded by means of specific budgetary support.

Uruguay (€ 7.95 million)

In Uruguay, the Commission will implement two projects:

    € 2.45 million will be used for the social development of the poorest rural areas in the north of the country, the programme's specific objective being to reduce unemployment, especially among young people and women. Other expected results are the improvement of the rural habitat, increase of production volumes and reinforcement of the institutional competencies.

    An EU contribution of € 5.5 million will enable the introduction of greater efficacy and efficiency in the tax collection by the General Tax Authority, thus modernising the organisation and fostering an improved financial solvency of the state.

Mercosur (€ 4 million)

The general objective of the project for "Harmonisation of Technical Standards, Technical Regulations and Conformity Assessment Procedures", of € 4 million, is to facilitate the free circulation of products between the Mercosur member countries, and between Mercosur and the European Union. Activities include the installation of a communication system for MERCOSUR certification and standardisation bodies, definition of the latter's accreditation scope, identification of harmonisation and certification needs, and developing laboratory quality systems with acquisition of corresponding equipment .

Andean Community (€ 4 million)

The Andean Community (Bolivia, Colombia, Ecuador, Peru and Venezuela) has started a political process leading to the creation of a Common Andean Market in 2005. A trade related technical assistance programme, funded with an EC contribution of € 4 million, will contribute to reaching its objectives, which include the adoption of a common external tariff, the setting up of a common agricultural policy, harmonisation of legislation and of statistical information instruments, and the implementation of convergent standards and of the macro-economic policies.

Central America (€ 15 million)

The European Commission has approved a programme supporting the Central American integration (EU contribution € 15 million), whose specific objective is to increase the capacity of both the bodies of the Central American Integration System (SICA) and of civil society to strengthen and deepen the process of integration and co-operation so that the region's economies can better integrate into the world economy. The project will thus contribute to institutional reform and the adoption and implementation of a strategic agenda for integration.

Regional Latin America (€ 950,000)

The Programme for the Democratic Development in Latin America (PRODALL), for which the EC will contribute € 950.000, aims at stimulating Latin America's capacity to reinforce democracy by means of formulating new strategies for regional development. The general objective is to establish, in partnership with the Latin American governments, UNDP, non governmental and international organisations, a broad Agenda for the strengthening and development of democratic governance in the sub continent.

Background

Building on long-existing bilateral relations between European countries and Latin America, the European Union has established and built up links with Latin America since the 1960s. The relationship between the two continents has substantially evolved over the past three decades. Today's partnership reflects the increasing importance and growing potential of the Latin American region, and the will of both parties to further strengthen the relationship in the future. The EU is an important economic and political partner for Latin America, it is the leading donor in the region, premier foreign investor, and second most important trade partner.

The EU's relations with Latin American countries have developed at the bi-regional level (European Union-Latin America), and a number of specialised dialogues within this broader relationship are ongoing with specific sub-regions (the Mercosur, Andean Community, and Central America), and between the EU and specific nations (Mexico and Chile). A full range of co-operation agreements have been concluded at each of the levels, based on the three pillars of economic co-operation, institutionalised political dialogue and the strengthening of trade relations.

For additional information on the EU-Latin America relations

http://ec.europa.eu/external_relations/la/index.htm

And for EU assistance to Latin America

http://ec.europa.eu/europeaid/projects/amlat/index_fr.htm

(1) € 246,991 million


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