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Tuesday, 13 December 2016

EU steps up its support for Benin with EUR 184 million

Mr Neven Mimica, Commissioner for International Cooperation and Development, today signed a new package of financial support worth EUR 184 million in the presence of the President of Benin, Mr Patrice Talon. The package consists of direct support to the national budget and support for the decentralisation process. Through their signature, the authorities of the European Union and Benin have given the green light for the implementation of two flagship governance programmes in Benin. The aim is to support the government's efforts to reduce poverty and promote reforms. Mr Mimica made the following statement: ‘The EUR 184 million aid package shows the EU's commitment to supporting the Beninese Government in its efforts to introduce good governance, improve the management of public finances and fight fraud and corruption. The efforts already undertaken in these areas must be commended and continued. They are key to winning the trust of the Beninese people, of private investors and of donors.' The first financing agreement consists of a Good Governance and Development Contract (GGDC) for EUR 114 million, EUR 103 million of which is for direct budget support over a period of five years from 2016. The aim is to promote good economic and financial governance by strengthening the transparent management of public finances, creating a credible system to fight corruption based on the independence of the judiciary, and improving the business climate by implementing reforms that will boost competitiveness and provide greater legal certainty for investments. Payments under this contract will be established on the basis of a policy dialogue with the government on the progress of reforms in these areas. Technical support for a total of EUR 11 million euros will be provided to help the country achieve the objectives of the Good Governance and Development Contract. EUR 70 million will go to a programme to support local development (Programme d'Appui au Développement Territorial, PADT), which will help implement Benin's decentralisation and devolution policy. Sectoral budgetary support of EUR 60 million will mostly be channelled through the support fund for local (communal) authorities. The amount of the annual instalments will depend on the results achieved by the Beninese Government, as estimated using a set of 10 indicators to evaluate progress in reforming local government, in terms of both the transfers of government resources to the communes and the management of these resources by the communal authorities. There will also be EUR 10 million in additional support under this programme for capacity-building at all administrative levels in order to support the National Association of Benin's Communes and for financing innovative regional development projects proposed and implemented by the Beninese communes.

Source: European Commission