Transparency and Strategy Needed in EU Budget Support to Georgia, Moldova and Ukraine

The report “EU Budget Support to Eastern Partnership Countries” evaluates the EU funding instruments in the cases of Moldova, Georgia and Ukraine. It addresses in a detailed manner and from a technical and practical points of view seven main issues:

Verification of the actual fulfilment of three major conditions for budget support provisions (sectoral development or existence of reform policy and strategy, stability-oriented macroeconomic framework, programme to improve public financial management)
Evaluation of factors/shortcomings in legal regulation or political climate
Availability of full information on budget support (general and sectoral),
Availability of information (reports) on results of implementation
Proper use of the EU budget support
Policy impact achieved so far
Civil society involvement

The report suggests that Moldova is the EaP country most dedicated to the reform process. The EU also considers Georgia as a reliable partner as the annual budget support has been increasing since 2007. The country implemented 85-95% of the EU programs and the corresponding spending, according to the EU budget support coordinator. There has been significant changes in the improvement of the budgetary and financial management systems, and in the implementation of justice reforms. As for Ukraine, in 2013 it received its largest sectoral budget support, with almost 90 EUR mln.

Despite positive trends, all three countries face similar challenges. First and foremost, there is the lack of transparency in the government spending. The availability and quality of information on EU budget support is minimal as plans and reports are often not published. Internal and external audits are weak, which leaves the door open to corruption. There are still weaknesses in the field of financial supervision, strategic planning and management, as well as the lack of inter-ministerial communication and coordination mechanisms.

The report encourages the EU to strengthen cooperation through joint monitoring, evaluation processes and risk assessments, as well as to elaborate on a more reasonable, precise and easily measurable conditionality framework that can go beyond political approximation.

The lack of civil society monitoring is particularly highlighted while it is pointed out that civil society should advocate for the full implementation of transparency and accountability principles in budget spending.

Full text of the Report

back to Forum News