Technical and financial cooperation
In line with the objectives of sustainable development and progressive integration of the African, Caribbean and Pacific (ACP) countries into the global economy that are enshrined in the Cotonou Agreement, [2 MB] the EC’s cooperation with Liberia is focused on poverty reduction as its core development strategy.
To assist Liberia in her effort to development and taking into account the complexity and multi-dimensional nature of poverty, the EC’s cooperation with Liberia is aligned with Liberia’s Poverty Reduction Strategy [8 MB] (PRS).
The priority areas outlined in Liberia’s PRS to address the poverty challenge are:
- Enhancing National Security
- Revitalizing the Economy
- Strengthening Governance and the Rule of Law
- Rehabilitating Infrastructure and Delivering Basic Services
Periodic consultations with the Government of Liberia resulted in the joint EC-Liberia Country Strategy Paper - Indicative Programme [3 MB] (CSP-IP). The multi-annual aid planning exercise reflects the European Union (EU)’s policies, fundamental principles and European Development Fund financing cycle as well as Liberia’s institutional, economic and social conditions. It is the basis for the delivery of the EC funded assistance to Liberia.
The majority of EC assistance to Liberia is financed through the European Development Fund (EDF), the main instrument to finance programmes or projects which contribute to the economic, social or cultural development with the countries of Africa, the Caribbean and the Pacific.
The EDF consists of several instruments, including grants, risk capital and loans to the private sector. It is funded by the EU Member States; it is subject to its own financial rules, is managed by a specific committee, and is additional to resources available from the annual European Union budget.
Each EDF, which follows the cycle of the partnership agreements, is concluded for a period of five years. The 10th EDF, on the basis of the Country Strategy Paper and Indicative Programme for the period 2008-2013 , has allocated Liberia 161.8 million euros. The EDF also provides funding at a regional level through ECOWAS on the basis of a Regional Strategy Paper and through a number of intra-ACP and intra-regional instruments established to tackle crucial areas of intervention such as the consolidation of peace, energy, water, infrastructure, education, research and microfinance.
The European Union budget also provides for a number of different financing instruments, mainly used for projects proposed by non-state actors to address priority issues. They cover, for example, humanitarian actions, food security, human rights and environmental protection.
In general, EC external aid consists of grant funding in favour of the beneficiary country. European Development Fund (EDF) resources are committed against approved project proposals and contracted in the form of supply, works, service contracts after a tendering process and annual work programmes.
In addition there’s an increasing use of budgetary support to channel EDF resources through the recipient country operating and capital budget. Budgetary support was introduced to Liberia in 2010.
In the case of other sources of financing (specific instruments or budget lines), funding is against a call for proposal or an acceptable project proposal from an implementing partner.