Regional integration for development in ACP countries

Regional integration should become a fundamental tenet of European Union development policy and its relations with the African, Caribbean and Pacific states. It is a vehicle for more political stability, accelerated growth and gradual trade opening. Regional integration is essential in achieving the progress needed to meet the Millennium Development Goals.

ACT

Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee of the Regions of 1 October 2008 “Regional integration for development in ACP countries” [COM(2008) 604 final – Not published in the Official Journal].

SUMMARY

The aim of this Communication is to present the European Union’s (EU) point of view on regional integration as a key mechanism for the sustainable development of African, Caribbean and Pacific countries (ACP). In particular, the Commission emphasises that regional integration is increasingly considered as a means of reaping the benefits and countering the negative impacts of globalisation.

Definition

Regional integration is the process of overcoming, by common accord, political, physical, economic and social barriers that divide countries from their neighbours, and of collaborating in the management of shared resources and common regional goods. The three main objectives of regional integration are:

• political stability: a pre-requisite for economic development;
• economic development: in larger, harmonised markets, the free movement of goods, services, capital and people enables economies of scale and stimulates investment;
• “Regional public goods”: only cooperation between neighbouring countries can address trans-national challenges such as food security, preservation of biodiversity and tackling climate change.

Challenges to be addressed

Even though regional integration of the ACP countries has progressed since the middle of the 1990s, particularly with the creation of free-trade areas and customs and monetary unions, a certain number of challenges remain:

• the lack of institutional capacities at regional and national level;
• the fragmentation of regional markets;
• insufficient economic diversification;
• poorly interconnected infrastructures;
• the need for more effective regional policies to address common challenges related to sustainable development.

In order to respond to these challenges, the Commission considers that the EU should commit to supporting five priorities:

• strengthening regional institutions;
• building regional integrated markets;
• supporting business development;
• connecting regional infrastructure networks;
• developing regional policies for sustainable development.

Taking advantage of EU instruments

The Commission stresses the need to improve the coherence and effectiveness of instruments available to the EU in order to increase their impact on the five priorities listed above. Thus, the Commission considers that political dialogue should be enhanced and broadened at regional level, in particular through sharing its experience with ACP countries and by encouraging the creation of regional business forums and regional civil society forums. In addition, support for regional integration will be strengthened through the 10th European Development Fund (EDF), as well as under the framework of other programmes such as the instrument for development cooperation, the facility for rapid response to soaring food prices in developing countries and the Instrument for Stability.

The Commission also considers that the Commission and Member States should develop a common approach to support regional integration of ACP countries and strengthen coordination with other development partners, such as the international financing institutions and regional development banks.

More effective delivery

With regard to delivery of programmes and projects, the Commission deems it necessary to adopt a more strategic approach by:

• gradually moving to a programme- (rather than project-) based approach;
• promoting joint delivery (co-financing, delegated cooperation and pool funds);
• establishing funds at regional level;
• prioritising projects of a truly regional dimension;
• including the regional dimension more systematically in projects supported at national level.

Trade policy

The Commission considers that regional Economic Partnership Agreements (EPA) are a key instrument of the ACP-EU partnership in promoting regional integration. In particular, they will:

• support the effective implementation of regional trade-in-goods commitments;
• encourage regional trade in services and promote investment within the region;
• consolidate a set of regional trade-related rules.

The Commission highlights other trade policy challenges:

• the interplay between regionalism and multilateralism: regional openness needs to be designed so as to maximise its development impact;
• the rationalisation of trade integration agendas in Africa: the EU will cooperate with the African Union to facilitate the future creation of an integrated African economic area.

Context

The European Union has been a long-standing supporter of regional integration in developing countries, an issue which occupies a central place in the European Consensus on Development.

Last updated: 07.10.2008