The EU is playing a game of Diplomacy (and Risk) with your money

Is the EU putting UK foreign policy objectives at risk by handing out cash to the likes of Belarus and Syria?

Stacks of it: The EU is handing out money like it's going out of fashion
Rory Broomfield
On 30 August 2012 09:35

Many have become used to the fact that the UK spends nearly £8 billion per year on international development assistance, but did you know the EU is doing it as well?  

Indeed, given the current state of many economies within the EU, you may have thought that it would lead from the front with plans to either stop taking so much from struggling countries in the EU or to set up a project to increase inward investment to save the European project. On the contrary, it seems, from figures recently released by the European Commission, that it is intent on investing heavily in other countries outside the EU.

The figures, revealed on various Commission websites, show that from 2007 until 2013 the Commission, under the “European Neighbourhood Policy” (ENP), will spend €12 billion in assistance and more in loans to “Southern Mediterranean Neighbours” (MEDA) and “Eastern Neighbours and Russia” (TACIS). This represents a 32 percent increase in real terms from the last “financial framework” of 2000 till 2006.  

It means that total The EU Commission is responsible for the management of €11 billion of aid per year, putting it in second place among donors globally.

But what is the EU spending the cash on? Well, out of the ENP’s 2000-2006 funding platform, €5.3 billion was given in assistance to MEDA and €3.1 billion was given to TACIS, with approximately €2.5 billion in European Investment Bank lending split between the two areas.

And what are they currently spending money on? The money spent by the ENP prospectively goes to 16 nations. This includes assistance to Algeria amounting to more than €700 million in grants and €2.2 billion in European Investment Bank loans. It also includes a grant of nearly €500 million to Morocco for:

-  Endorsing gender equality (€45 million); 

-  Constructing a 103 kilometre highway (€125 million);

-  Managing forests and public funds (€112 million);

-  Improving health care (€126 million).

Added to this, €350 million was initially ear-marked to support democracy in Egypt, Jordan, Morocco and Tunisia with other southern Mediterranean countries also being covered if the ‘conditions were right’.

Of course, the European Union supports democracy. So much so that, through the European Neighbourhood and Partnership Instrument (ENPI), the EU is due to give €56.67 million of EU taxpayers’ money to Belarus – commonly known as “the last dictatorship in Europe” - in 2012-13. This is on top of the increased €16.07 million in assistance the Commission ear-marked for Belarus through a 2011 “bilateral envelope” and the €30 million it gave to the Belarusian Government between 2007 and 2010.

It also should also be noted that the ENIP announced it was to give Syria €129 million for 2011-2013, or an average of €43 million a year (an increase of 32.3 percent in comparison to the funds that the EU gave to Syria through this scheme between 2007 and 2010).

Despite not being as large as the UK’s international development spending programme it should be recognised that European taxpayers are paying for these schemes and giving money to these countries. Furthermore, as the UK is a net contributor to the EU’s budget, UK taxpayers are also paying for international development twice through the UK government and the European Commission.

More worrying though is the fact that the UK taxpayer doesn’t have a say on where this money goes; even the UK government may not have as much influence as it thinks it has over this matter.

With funds going to countries like Belarus and Syria through the EU, there is the possibility that this spending may be undermining the UK’s foreign policy objectives.

Indeed, the only way to ensure that development funds do not contradict the interests of UK taxpayers and their government is for the UK to control what is spent and how. To achieve this, the UK would need to leave the EU; it would certainly be better off out.

Rory Broomfield is Deputy Director of The Freedom Association. He tweets @rorybroomfield 

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