Cleared from scrutiny; further information requested; drawn to the attention of the Foreign Affairs and the International Development Committees
Recommendation for a Council Decision authorising the opening of negotiations on a Partnership Agreement between the European Union and countries of the African, Caribbean and Pacific Group of States
Articles 218(3) and (4) TFEU; QMV or unanimity depending on final content of the agreement
(39367), 15720/17 + ADD 1, COM(17) 763
4.1The EU maintains a special economic and political relationship with countries in Africa, the Caribbean and the Pacific (ACP) which have former colonial links to its Member States. Forty-one ACP countries are also members of the Commonwealth. Currently, the bilateral EU-ACP relationship is governed by the Cotonou Partnership Agreement (CPA), which was signed in 2000 and expires in 2020. It creates the framework for political dialogue and cooperation on a range of issues, including trade and economic development, climate change, and food security. The Agreement also requires the EU to provide funding for development assistance projects in ACP countries via the European Development Fund (EDF), which currently runs from 2014 to 2020 and amounts to €30.5 billion (£27 billion).
4.2As the Cotonou Agreement expires in 2020, the EU has been engaged in a process of reflection on the options for the future of the EU-ACP relationship since 2015. In December 2017 the European Commission formally submitted a proposal for the EU’s input into the negotiations with the ACP bloc on a successor agreement (in the form of a Council Decision containing a formal mandate for the Commission, which would negotiate on the EU’s behalf). The Commission proposes the creation of three “Regional Compacts” with the African, Caribbean and Pacific groupings of the ACP bloc respectively, to reflect regional priorities more easily in the bilateral relationship. A proposal for the next European Development Fund, which would finance development assistance in ACP states as part of the EU’s engagement under post-Cotonou, is due in June 2018.
4.3The Government is broadly supportive of the proposed regional approach to the EU’s partnership with the ACP. The Minister for International Development (Lord Bates) told us in January 2018 that the Government would remain actively engaged in the discussions among Member States on the EU’s position for the negotiations, but was unable to clarify the Government’s preferred outcome with respect to the UK’s position in the new framework after Brexit (i.e. full participation by the UK, or a supporting role as part of an entirely new partnership by the UK with ACP countries bilaterally).
4.4After we first considered the proposed negotiating mandate for the new EU-ACP Agreement in January 2018, we retained the proposed Council Decision under scrutiny because the Minister had been unable to articulate in any more detail the Government’s approach as regards the level of the UK’s proposed involvement in the EU-ACP relationship after Brexit. We asked him to clarify the UK’s position on potentially seeking accession to the post-Cotonou treaty as a non-EU, non-ACP member (and similarly whether the Government would want to stay embedded in the next European Development Fund to maximise the economies of scale and increased coherence of offering overseas aid collectively with the EU-27 after the end of the post-Brexit transitional period).
4.5We received two letters from the Minister with respect to the EU-ACP negotiations in April and May 2018. These firstly summarise the status of the deliberations between the Member States on the Commission’s proposal of December 2017:
4.6Given the Committee’s questions about the future of the UK’s relationship with the ACP bloc after Brexit, the bulk of the Minister’s letters focus on the question of the UK’s potential participation in the institutional architecture of the post-Cotonou Agreement. The Minister firstly explains that the new treaty, if it enters into force during the post-Brexit transitional period, will form part of the body of EU law in the same way as existing agreements and the Government “would expect the terms of the agreement to apply to and in the UK for this time limited period”.
4.7As regards the UK’s engagement in the EU-ACP framework after the end of the transitional period, the Minister notes that Brexit will not prevent the UK from “work[ing] with the EU where we choose to, and where it is in our mutual interests” and also allow it to “tailor our relationships to our UK priorities from January 2021”. Any partnership between the UK and the EU-ACP, he says, should be on an “opt-in basis at a strategic level, with clear governance arrangements”.
4.8The Minister’s letters therefore reiterate that the Government remains “fully engaged in discussions around the successor to the Cotonou Agreement and on the shape of the future financial instruments […] with a view to what will allow greatest flexibility for potential UK participation in the future”. While he has welcomed the proposed ability for non-EU, non-ACP countries to seek either observer status or full membership under the Agreement, he adds that the Government does not yet have a policy position on whether to make use of either option because “it would be premature to do so until we have a clearer understanding of the possible terms of such engagement” and of the “corresponding rights and obligations” (i.e., until there is a finalised text on which both the EU and ACP are agreed).
4.9With respect to the potential contributions by the UK to the EU’s funding instrument for development assistance projects in the ACP (the successor to the current European Development Fund), the Minister says that he will provide an update on the Government’s position when negotiations on the next Multiannual Financial Framework—the EU’s long-term budget for the 2021–2027 period—are underway. However, the Government’s own policy paper on the “Framework for the UK-EU Security Partnership”—published on 9 May—explicitly calls on the UK and the EU to “explore a mechanism” for cooperation on development policy that could include the UK making “a [financial] contribution to an EU programme or instrument” in return for “an appropriate role in the relevant decision-making mechanisms”.
4.10The Member States will be asked to approve the negotiating mandate at the Foreign Affairs Council on 28 May 2018, allowing for formal talks between the European Commission and the ACP bloc to begin after the summer recess.
4.11We thank the Minister for the information he has provided about the finalisation of the EU’s position for negotiations on the next framework for the Union’s relations with the ACP states, and the Government’s thinking about how the UK will fit into this framework after it ceases to be an EU Member State. In our previous Report, we attempted to elicit further information from the Minister about the Government’s view on:
4.12It is clear to us the Government, for better or worse, is not in a position to give a clear answer at present about the preferred status for the UK under the EU’s new treaty with the ACP. To a certain extent, this is understandable as the legal framework that would underpin the UK’s accession or observer status within the EU-ACP partnership has not yet been established.
4.13However, we remain concerned about the apparent lack of a strategic vision for the continuity in the UK’s relations with the ACP bloc after the end of the post-Brexit transitional period (especially given that the Government will not be represented in the existing EU-ACP institutions during that period). It appears the Government will not decide on its approach to the post-Brexit relationship with the 79 ACP countries on matters currently covered through the UK’s EU membership—including institutional mechanisms for political dialogue and the way in which the UK’s current contributions to the European Development Fund will be deployed by the Department for International Development—until well into 2019, when there is more clarity about the outcome of the EU-ACP and UK-EU negotiations.
4.14There is also the broader issue of the refocusing of the EU’s external priorities with the loss of the UK as a member. While the countries with historical links to the UK will still be covered by the successor to the Cotonou Agreement, they are losing the most influential supportive voice on the EU side when the UK ceases to be represented in the EU institutions. That makes the Government’s plans for the future of its relationship with the forty-one Commonwealth nations that are also members of the ACP bloc all the more pressing.
4.15Overall, the Committee remains concerned that the ‘wait and see’ approach adopted by the Government could complicate efforts to establish an alternative to participation in the EU-ACP framework after the end of the transitional period. Negotiations on the new EU-ACP treaty are due to begin in August this year, and the timetable for their completion is not yet clear (although the aim is to have them finalised before May 2020, when the Cotonou Agreement expires). That may leave very little time for the Government to negotiate a bilateral alternative with ACP countries (either as a bloc, individually or in groupings), risking either a disruption in the bilateral relationship when the UK ceases to be covered by the EU’s international agreements or effectively force the Government’s hand in seeking accession to the new EU-ACP agreement to avoid such an outcome.
4.16The Minister’s Explanatory Memorandum did not confirm whether the Government will seek to remain a contributor to the successor to the current European Development Fund. It is a substantial contributor to the 2014–2020 Fund (due to pay in £2.7 billion to cover EU funding commitments made to the ACP bloc over that period), raising the prospect of either managing this expenditure domestically or seeking an agreement with the EU on a continued financial contributions to its collective development policy. With respect to the latter option, the Government’s new policy paper on the future UK-EU partnership on security and foreign affairs (published after we received the Minister’s Memorandum) explicitly makes the offer of continued UK contributions to the EU’s development assistance instruments in return for an “appropriate” (but unspecified) “role in the relevant decision-making mechanisms”.
4.17We note in this respect that the European Commission has announced that it wants to make the European Development Fund for the 2021–2027 period fully part of the EU’s legal, institutional and budgetary framework. This would be a radical departure from the approach since 1957, under which successive Funds have been established by separate treaty between the Member States and funded directly by their national Exchequers (rather than via the general EU budget). Moreover, the Commission has proposed the merger of the current EDF with the Development Cooperation Instrument and the European Neighbourhood Instrument (which act as the EU’s development assistance funds for non-ACP developing countries and countries in the EU’s eastern and southern ‘neighbourhood’ respectively) into a single funding instrument called the “Neighbourhood, Development and International Cooperation Instrument” (NDIC Instrument).
4.18This new budgetary and governance approach, if accepted by the Member States, would complicate the UK’s ability as a ‘third country’ to participate in, and contribute to, the management of EU development assistance projects for the ACP states (and notably those with which the UK maintains the closest ties, i.e. Commonwealth nations). Depending on the design of the new NDIC instrument, UK participation could present the Government with the option of participating in the entire Instrument (i.e. including channelling some of its development funding for non-ACP countries via the EU as well) or not at all. Moreover, the EDF’s integration into the EU’s legal structures (and therefore the general institutional limitations of its Treaties) would almost certainly rule out any possibility of a UK vote over country-specific work programmes and funding decisions under the new European Development Fund. We will revisit our conclusions on this point after we receive the Government’s Explanatory Memorandum on the European Commission’s formal proposal for the NDIC Instrument this summer.
4.19While we now clear the proposed mandate for negotiations between the European Commission and the ACP states from scrutiny, enabling the Minister to support the final text at the meeting of the Foreign Affairs Council later this month, we do so on the condition that we continue to receive updates on developments in the negotiations as they progress (and how this affects the Government’s evolving position on what role the UK should play, if any, in the new EU-ACP framework as a ‘third country’). We also ask the Minister to confirm by what legal mechanism the effects of the new EU-ACP Agreement would be extended to the UK during the transition, as it will never have been a party to the treaty—either independently or by virtue of its EU membership—if it enters into force after 29 March 2019.
4.20We will similarly continue to press the Minister for more detailed information about the Government’s position on the possibility of continued financial contributions to the EU’s development policy instruments after 2020. We expect his Explanatory Memorandum on the forthcoming European Commission proposal for the NDIC Instrument to contain an initial assessment of any ‘third country’ provisions in that draft Regulation from the UK’s post-Brexit perspective, and to define more precisely what would be an “appropriate” role for the UK in the governance structures of the NDICI if it decided to offer financial contributions to the Instrument from 2021 onwards.
Recommendation for a Council Decision authorising the opening of negotiations on a Partnership Agreement between the European Union and countries of the African, Caribbean and Pacific Group of States: (39367), + ADD 1, COM(17) 763.
51 The Agreement is available in full .
52 After the EU’s unilateral trade preferences for ACP countries were ruled in contravention of WTO rules, it has been (EPAs) with regional groupings of ACP states which are based on reciprocal trade preferences. The UK is discussing the continuation of the EPAs in place with the countries concerned after the UK leaves the EU.
53 The UK is a major contributor to the EDF, having agreed to provide nearly 15 per cent (£3.2 billion) of its budget over the 2014–2020 period. Under the terms of the Withdrawal Agreement, it would honour these commitments in full despite its exit from the EU.
54 European Commission consultation, ““ (October 2015).
55 For example, the African ‘Compact’ would focus on democratic governance and conflict resolution; the Caribbean Compact would focus assistance on the region’s environmental and disaster resilience; and the Pacific Compact would similarly focus on climate change and fisheries.
56 Explanatory Memorandum submitted by the Department for International Development (11 January 2018).
57 See for more information the Committee’s .
58 Because it is currently constituted by a separate Treaty outside of the EU institutional and legal framework, the European Development Fund could theoretically accommodate a non-EU country more easily in its governance structures (as, indeed, the UK will have during the post-Brexit transitional period in a way that it will not for any of the programming committees for funding instruments within the EU framework). Such flexibility is unlikely to be on offer if the next European Development Fund, as the Commission is proposing, becomes formally part of the EU budget and institutional structures.
59 Letter from Lord Bates to Sir William Cash (18 April 2018).
60 Letter from Lord Bates to Sir William Cash (3 May 2018).
61 The Minister notes that the UK has been able to secure “stronger references to gender equality and inclusion of people with disabilities, in line with the UK’s strong leadership on the ‘Leave No-One Behind’ agenda and commitment to prioritise disability inclusion”.
62 See .
63 I.e., either via a continued contributions the EU, or by increasing the responsibilities of the Department for International Development to manage the current contributions to the EDF bilaterally.
64 It should also be borne in mind that negotiating bandwidth to establish any new bilateral approach on both sides will already be stretched by the UK’s and ACP’s discussions with the EU on their respective future relationships.
65 The UK could potentially seek to make a contribution to the successor to the current European Development Fund irrespective of its choice on participation of the EU-ACP agreement as a whole (although, should the UK seek accession to the EU-ACP agreement as a third party, it would most likely have to make financial contribution to the EU’s development assistance to the ACP in any event).
66 See Commission document , p. 80.
Published: 22 May 2018