PURPOSE: to grant discharge to the Commission for the implementation of the 6th, 7th, 8th and 9th European Development Funds (EDF) for the 2004 financial year and to close the accounts of the EDF for 2004.

LEGISLATIVE ACTS: Decisions 2006/818/EC and 2006/819/EC of the European Parliament on the discharge for implementation of the budget of the sixth, seventh, eighth and ninth European Development Funds for the financial year 2004 and closure of the EDF accounts for the financial year 2004.

CONTENT: with the present decisions, the European Parliament grants discharge to the Commission for the implementation of the budget of the sixth, seventh, eighth and ninth EDF for the financial year 2004 and approves the closure of the 2004 accounts.

The accompanying resolution is in line with the European Parliament’s opinion of 27 April 2006 (refer to the summary of the opinion dated 27 April 2006).

The European Parliament adopted a resolution drafted by Rodi KRATSA-TSAGAROPOULOU (EPP-ED, EL) and granted discharge to the Commission for the implementation of the budget of the 6th, 7th, 8th and 9th European Development Funds for 2004. In its accompanying comments, Parliament agreed with the Court of Auditors on the need for objective, and comprehensive indicators to measure the output of aid, and trusted that these will be put in place for the period 2007-13.

Parliament noted that, in 2004, out of a total of EUR 2 723 million in funding provided by EuropeAid to ACP countries (EDF and EU general budget), 41 % (EUR 1 129 million) was committed for infrastructure and social services. It deplored the fact that only EUR 12 million (0.4%) was earmarked for basic education and EUR 74 million (2.7%) for basic health, despite the recommendation in its previous discharge resolution. The Commission was urged to increase funding for these sectors. Parliament called for the percentage of EU development cooperation spending earmarked for basic education and health in the developing countries to be substantially increased.

Accounts: Although EDF funds managed by the European Investment Bank (EIB) are not audited by the Court of Auditors or controlled by Parliament as part of the discharge procedure, they are included in the EDF accounts. Parliament considered that transparency would be enhanced if information on these funds (amounts by type of use, overview of results) were provided to the discharge authority which is responsible for signing off the EDF accounts. It called on the EIB and the Commission to provide such information and to include it in their reports on the EDF.

Statement of assurance: With the exception of certain problems, the Court of Auditors felt that the accounts reliably reflect the revenue and expenditure relating to the sixth, seventh, eighth and ninth EDFs. According to the Court of Auditors' annual report, the EuropeAid Director-General's activity report makes no mention of major internal control weaknesses. These weaknesses consist mainly of insufficient audits and follow-up. Weaknesses in national authorising officers' management capability result in a heavier workload for the delegations, and Parliament called on the Commission to take appropriate action.

Financial Management Report: Parliament welcomed the improvement in the quantity and quality of information contained in the Financial Management Report but called on the Commission to provide more details in future reports, particularly so as to enable comparisons to be made of the amounts allocated to projects, budgetary support and non-programmable aid coming under the ninth EDF to those for previous EDFs and in order to have an overview of the related administrative expenditure.

Accountability: Parliament noted that while the Commissioner for Development and Humanitarian Aid was responsible for EDF policy and for specific matters concerning the related projects and programmes managed by EuropeAid, the Commissioner for External Relations and European Neighbourhood Policy was responsible for all general policy and management matters concerning the functioning of EuropeAid, which implements the EDF. Parliament remained concerned that the lack of clarity over responsibility may create ambiguities and disrupt operations. It called on the Commission to clarify the breakdown of responsibilities for the EDF and external aid.

Implementation and RAL: EuropeAid quoted a figure as at the end of 2004 of EUR 9 776 million in outstanding commitments (reste à liquider - RAL) for the EDF and a figure of EUR 11 607 million for the budget lines which it manages. These figures are far too high and Parliament urged the Commission to speed up implementation of external aid.

Budgetary support for ACP countries: Parliament noted the increasing significance of budget support, with EUR 624 million disbursed in 23 ACP countries in 2004. It acknowledged that budget support could contribute effectively towards reducing poverty and improving public financial management in recipient countries, in particular by giving them a greater sense of 'ownership'. The Commission was asked to adjust its instruments to assess economic reforms and the quality of public financial management as conditions for eligibility for budget support. Parliament also urged the Commission to place on a more systematic footing its cooperation with supreme audit institutions and, where possible, to call on governments of beneficiary countries to secure more active parliamentary involvement in audit and the public finance reform process.

Supreme audit institutions: Parliament noted that the Commission was considering different modalities for supporting the role of the supreme audit institutions in the ACP states, and asked for an assessment of the various options under consideration.

Budgetisation: Parliament considered that budgetisation of the EDF would remove many of the complications and difficulties of implementing successive EDFs, help speed up disbursement and eliminate the current democratic deficit. However, Parliament drew attention to its resolution on the EDF of 8 June 2005, when it underlined that budgetisation was only acceptable if the overall ceiling of the financial framework brings additional resources into the general budget, and that the appropriations budgeted should be ring-fenced to avoid any negative effect on the ACP countries. Parliament regretted that the European Council in December 2005 did not agree to the budgetisation of the EDF, but welcomed the fact that the Member States did agree to allocate EUR 22 682 million at current prices to cooperation with the ACP states over the period 2008-2013. It called, nonetheless, on the Council and Commission to continue to work on incorporating the EDF into the general budget.

Devolution of management of aid and support: Parliament supported the Commission's devolution of resources and decision-making powers to the delegations of the Commission and expected that this new organisational structure would contribute to even swifter implementation of commitments and payments and to better project follow-up. It noted the risks of the process of devolution to the Commission delegations in ACP countries, such as difficulties in finding appropriate staff and the possibility of incoherent interpretation of rules between Commission delegations. There was a need to improve the rules and to find a balance between reinforced control mechanisms and the need for reporting on one hand, and efficient and speedy decision-making locating the main decisions on projects in the delegations on the other.

Stabex funds: The inventory of Stabex funds in 2004 showed that some ACP states did not supply the required financial statements and that, as a result, an unknown portion of the declared bank balance of EUR 832 million had not been certified by the Commission on the basis of reliable supporting documents. The Commission must work with the beneficiary countries to enhance monitoring and ensure that the outstanding funds are committed as rapidly as possible.

Internal control standards: Parliament expressed concern at the fact that the Commission was complying with only the minimum requirements for certain control standards.

Visibility and transparency: Parliament urged the Commission to clarify its reply to the request for additional explanations on key issues made by the Court of Auditors in its annual report covering the increase in resources for the ninth EDF, with specific reference to the item concerning aid granted to the Democratic Republic of Congo. It acknowledged the progress made by the Commission in ensuring a higher profile for Community external aid action, but deplored the fact that the public is not aware of the EU's close involvement in many projects and programmes conducted jointly with the United Nations and other organisations. It asked the Commission to take action.

The committee adopted the report by Rodi KRATSA-TSAGAROPOULOU (EPP-ED, EL) recommending that Parliament should grant discharge to the Commission for the implementation of the budget of the 6th, 7th, 8th and 9th European Development Funds for 2004. In its accompanying comments, the committee agreed with the Court of Auditors on the need for "objective, useful and comprehensive indicators to measure the output of aid" and called for these to be put in place for the period 2007-2013. It also deplored the fact that, of the total funding provided to ACP countries in 2004 under the EDF and the EU's general budget, only EUR 12 million (0.4%) was earmarked for basic education and EUR 74 million (2.7%) for basic health, despite Parliament's recommendations in its previous discharge decision. MEPs insisted that greater priority should be given to the main MDG (Millennium Development Goals) sectors of health and education in the next round of Country Strategy Papers.

MEPs highlighted the lack of clarity within the Commission over responsibilities for the EDF and external aid which, they said, "may create ambiguities and disrupt operations". On a more positive note, they supported the Commission's devolution of resources and decision-making powers to its delegations, while noting the difficulties this involved in terms of finding appropriate staff and a possible lack of consistency among the different delegations in interpreting rules. They called for the Commission to produce a report outlining the state of play of the devolution process and detailing the control structures in place in the delegations.

Among other points raised in the report, the committee noted the increasing significance of budget support and acknowledged that this could help reduce poverty and improve public financial management in recipient countries, by giving them a greater sense of 'ownership'. The Commission was asked to place its cooperation with supreme audit institutions on a more systematic footing and to urge governments in the beneficiary countries to secure more active parliamentary involvement in audit and the public finance reform process.

Lastly, the committee repeated Parliament's longstanding call for budgetisation of the EDF which, it stressed once more, would "remove many of the complications and difficulties of implementing successive EDFs, help speed up disbursement and eliminate the current democratic deficit".

The Council examined the revenue and expenditure account and the balance sheet relating to the Sixth EDF as at 31 December 2004 as well as the Court of Auditors' report together with the Commission's replies. Given that the overall implementation by the Commission of the operations of the Sixth EDF have been satisfactory, the Council recommends that the European Parliament give the Commission a discharge in respect of the implementation of the operations of the Sixth EDF for the financial year 2004.

The Council examined the revenue and expenditure account and the balance sheet relating to the Seventh EDF as at 31 December 2004 as well as the Court of Auditors' report together with the Commission's replies. Given that the overall implementation by the Commission of the operations of the Seventh EDF have been satisfactory, the Council recommends that the European Parliament give the Commission a discharge in respect of the implementation of the operations of the Seventh EDF for the financial year 2004.

The Council examined the revenue and expenditure account and the balance sheet relating to the Eighth EDF as at 31 December 2004 as well as the Court of Auditors' report together with the Commission's replies. Given that the overall implementation by the Commission of the operations of the Eighth EDF have been satisfactory, the Council recommends that the European Parliament give the Commission a discharge in respect of the implementation of the operations of the Eighth EDF for the financial year 2004.

The Council examined the revenue and expenditure account and the balance sheet relating to the Ninth EDF as at 31 December 2004 as well as the Court of Auditors' report together with the Commission's replies. Given that the overall implementation by the Commission of the operations of the Ninth EDF have been satisfactory, the Council recommends that the European Parliament give the Commission a discharge in respect of the implementation of the operations of the Ninth EDF for the financial year 2004.

PURPOSE : to present the Court of Auditors’ report on the 2004 budget implementation of the 6 th , 7 th , 8 th and 9 th EDF (European Development Fund).

CONTENT : the Court of Auditors published its 28 th Annual report concerning the financial year 2004.

The Court is of the opinion that the reports on financial implementation for the financial year 2004 and the financial statements at 31 December 2004 reliably reflect the revenue and expenditure relating to the sixth, seventh, eighth and ninth EDFs for the financial year and their financial situation at the end of the year, with the exception of the effects of the problems concerning :

§ the incompleteness of the assets, as the Commission has not sufficiently investigated which part of the outstanding advances are to be reimbursed by the debtors to the EDF;

§ the incompleteness of the provisions on doubtful debts, which do not reflect the real level of bad debts;

§ the unreliability of the balance of Stabex funds disclosed in a report joined to the financial statements (EUR 832 million).

On the legality and regularity of the underlying transactions, the Court examined the implementation of the Commission’s internal control standards and tested the effectiveness of the supervisory and control systems. While progress has been achieved, further improvements need to be made in the following areas: risk management; control framework; accountability for internal control of Delegations; Activity Report of the Director General of EuropeAid.

As regards budget support expenditure, the examination stopped at the stage where the aid was paid to the beneficiary countries’ budgets. The Court found that the frequency and financial impact of the errors detected are not material.

In conclusion, the Court is of the opinion that the revenue, the EDF allocations, the commitments and the payments of the financial year are, taken as a whole, legal and regular.

PURPOSE : presentation of the annual accounts for the financial year 2004 of the 6th, 7th, 8th and 9th European Development Funds (EDFs).

CONTENT : the balance sheets and income and expenditure accounts were drawn up in accordance with the Financial Regulations applicable to the 6th, 7th, 8th and 9th European Development Funds (EDFs). The relevant documents must be presented to the Court of Auditors as provided for in Article 71 of the financial Regulation applicable to the 7th EDF, Articles 66, 67 and 68 of the Financial Regulation applicable to the 8th EDF and Articles 102 and 103 of the Financial Regulation applicable to the 9th EDF.

The total assets of the 4 EDFs on 31.12.2004 amounted to EUR 18.614 billion compared to EUR 20.354 billion in 2003.

It should be noted that the total assets for each EDF is as follows:

6th EDF : total at 31.12.2004 : EUR 2.405 billion; 7th EDF : total at 31.12.2004 : EUR 2.296 billion; 8th EDF : total at 31.1é.2004 : EUR 6.872 billion; 9th EDF : total at 31.12.2004 : EUR 13.296 billion.

As with previous years, the report respects the main accounting principles and standards, in particular :

- unit of account;

- specification of resources;

- sound financial management;

- transparency;

- presentation of a revenue and expenditure account; etc.

In addition to the presentation of the consolidated accounts, this document details a statement of sources of the EDF in terms of its revenue (EIB special contributions, Stabex contributions, Member State contributions, recoveries, inter-fund transfers).

As regards the expenditure, the document presents a specific report on the financial implementation of the EDFs including a table outlining the state of expenditure by each beneficiary country and which type of financial instrument was used (Stabex, regional projects, loans…). This can be summarised as follows:

Previous EDFs : in accordance with several ACP-EC Council and Commission Decisions, the unallocated resources from previous EDFs to be used for programmes consistent with the relevant provisions of the Cotonou Agreement. Tables are set out separately for each of the 6th, 7th and 8th EDFs the part used for Lomé Convention programming and the part used for programming under the Cotonou Agreement. Entry in the accounts and the presentation of accounts in connection with the Cotonou Agreement is based on Article 3(2) of Annex IV of the ACP-EC Partnership Agreement, as regards countries. That Article gives the ACP countries an :

allocation A to cover macroeconomic support and support for programmes and projects; allocation B to cover unforeseen needs such as emergency assistance, debt relief initiatives and support to offset the adverse effects of instability in export earnings.

For the regions, the accounts are set out according to the regional programming (i.e. regional indicative programme and intra-ACP cooperation).

9th EDF : the Cotonou Agreement was concluded for a 20 year period with a 5 year review clause and a Financial Protocol for each 5 year period. The first five years are, therefore, financed under the 9th EDF. The 9th EDF was set at EUR 13 800 million, including EUR 13 500 million allocated to the ACP States in accordance with the first Financial Protocol included in the Cotonou Agreement, EUR 175 million allocated to the OCT (provided for by the EU Council Decision on the association of the OCT) and EUR 125 million reserved for the European Commission to cover expenses in connection with implementing the 9th EDF resources (provided for in the internal agreement for the 9th EDF).

Of the total 9th-EDF budget for the ACP States, EUR 1 000 million may only be released after examination by the EU Council in 2004, on the basis of a proposal from the European Commission. An initial tranche of EUR 250 million was released in 2004 in accordance with Council Decision 7189/04 of 22 March 2004 and allocated to the Intra ACP Fund (natural resources) to finance the Water Facility operation (EUR 42 million committed in 2004). The breakdown of 9th EDF allocations for ACP States, including the "conditional billion" and allocations managed directly by the European Investment Bank (EIB), is as follows:

Long term development budget : EUR 10 billion composed of allocation A for macroeconomic support for sectoral policies, programmes and projects supporting focal or non-focal areas of Community aid corresponds to the allocation for the NIPs and structural adjustment in previous EDFs and allocation B, intended to cover unforeseen needs such as emergency aid, contributions to debt reduction initiatives and support to offset adverse fluctuations in export earnings, generally corresponds to the Stabex, Sysmin and emergency aid allocations in previous EDFs; Regional budget : EUR 1.3 billion; Investment facility : EUR 2.2 billion.

Total : EUR 13.5 billion.

The total 9th EDF allocations for the OCT total EUR 175 million.

Moreover, under Commission Decision E/982/2003 of 16 June 2003, all unspent balances from EDFs prior to the date of entry into force of the Cotonou Agreement (for ACP countries) and the date of entry into force of the internal agreement on the 9th EDF (for the OCT countries), and all amounts decommitted after those dates for ongoing projects under those EDFs, have been transferred to the 9th EDF. Any resource thus transferred to the 9th EDF after previously having been allocated to the indicative programme of an ACP State or region has been allocated to that State or region. On the other hand, the unallocated resources have been transferred to reserves which will subject to new programming under the 9th EDF.

Lastly, the annual payments in 2004 can be summarised as follows:

§ Lomé (6th, 7th and 8th EDF ) : EUR 1.193 million;

§ Cotonou (9th EDF) : EUR 1.054 million (allocation A : EUR 655 million and allocation B : EUR 144 million, regional projects : EUR 12.27 million and intra ACP debt relief : EUR 100 million).

Total payments in 2004 : EUR 2.248 billion.

PURPOSE : presentation of the annual accounts for the financial year 2004 of the 6th, 7th, 8th and 9th European Development Funds (EDFs).

CONTENT : the balance sheets and income and expenditure accounts were drawn up in accordance with the Financial Regulations applicable to the 6th, 7th, 8th and 9th European Development Funds (EDFs). The relevant documents must be presented to the Court of Auditors as provided for in Article 71 of the financial Regulation applicable to the 7th EDF, Articles 66, 67 and 68 of the Financial Regulation applicable to the 8th EDF and Articles 102 and 103 of the Financial Regulation applicable to the 9th EDF.

The total assets of the 4 EDFs on 31.12.2004 amounted to EUR 18.614 billion compared to EUR 20.354 billion in 2003.

It should be noted that the total assets for each EDF is as follows:

6th EDF : total at 31.12.2004 : EUR 2.405 billion; 7th EDF : total at 31.12.2004 : EUR 2.296 billion; 8th EDF : total at 31.1é.2004 : EUR 6.872 billion; 9th EDF : total at 31.12.2004 : EUR 13.296 billion.

As with previous years, the report respects the main accounting principles and standards, in particular :

- unit of account;

- specification of resources;

- sound financial management;

- transparency;

- presentation of a revenue and expenditure account; etc.

In addition to the presentation of the consolidated accounts, this document details a statement of sources of the EDF in terms of its revenue (EIB special contributions, Stabex contributions, Member State contributions, recoveries, inter-fund transfers).

As regards the expenditure, the document presents a specific report on the financial implementation of the EDFs including a table outlining the state of expenditure by each beneficiary country and which type of financial instrument was used (Stabex, regional projects, loans…). This can be summarised as follows:

Previous EDFs : in accordance with several ACP-EC Council and Commission Decisions, the unallocated resources from previous EDFs to be used for programmes consistent with the relevant provisions of the Cotonou Agreement. Tables are set out separately for each of the 6th, 7th and 8th EDFs the part used for Lomé Convention programming and the part used for programming under the Cotonou Agreement. Entry in the accounts and the presentation of accounts in connection with the Cotonou Agreement is based on Article 3(2) of Annex IV of the ACP-EC Partnership Agreement, as regards countries. That Article gives the ACP countries an :

allocation A to cover macroeconomic support and support for programmes and projects; allocation B to cover unforeseen needs such as emergency assistance, debt relief initiatives and support to offset the adverse effects of instability in export earnings.

For the regions, the accounts are set out according to the regional programming (i.e. regional indicative programme and intra-ACP cooperation).

9th EDF : the Cotonou Agreement was concluded for a 20 year period with a 5 year review clause and a Financial Protocol for each 5 year period. The first five years are, therefore, financed under the 9th EDF. The 9th EDF was set at EUR 13 800 million, including EUR 13 500 million allocated to the ACP States in accordance with the first Financial Protocol included in the Cotonou Agreement, EUR 175 million allocated to the OCT (provided for by the EU Council Decision on the association of the OCT) and EUR 125 million reserved for the European Commission to cover expenses in connection with implementing the 9th EDF resources (provided for in the internal agreement for the 9th EDF).

Of the total 9th-EDF budget for the ACP States, EUR 1 000 million may only be released after examination by the EU Council in 2004, on the basis of a proposal from the European Commission. An initial tranche of EUR 250 million was released in 2004 in accordance with Council Decision 7189/04 of 22 March 2004 and allocated to the Intra ACP Fund (natural resources) to finance the Water Facility operation (EUR 42 million committed in 2004). The breakdown of 9th EDF allocations for ACP States, including the "conditional billion" and allocations managed directly by the European Investment Bank (EIB), is as follows:

Long term development budget : EUR 10 billion composed of allocation A for macroeconomic support for sectoral policies, programmes and projects supporting focal or non-focal areas of Community aid corresponds to the allocation for the NIPs and structural adjustment in previous EDFs and allocation B, intended to cover unforeseen needs such as emergency aid, contributions to debt reduction initiatives and support to offset adverse fluctuations in export earnings, generally corresponds to the Stabex, Sysmin and emergency aid allocations in previous EDFs; Regional budget : EUR 1.3 billion; Investment facility : EUR 2.2 billion.

Total : EUR 13.5 billion.

The total 9th EDF allocations for the OCT total EUR 175 million.

Moreover, under Commission Decision E/982/2003 of 16 June 2003, all unspent balances from EDFs prior to the date of entry into force of the Cotonou Agreement (for ACP countries) and the date of entry into force of the internal agreement on the 9th EDF (for the OCT countries), and all amounts decommitted after those dates for ongoing projects under those EDFs, have been transferred to the 9th EDF. Any resource thus transferred to the 9th EDF after previously having been allocated to the indicative programme of an ACP State or region has been allocated to that State or region. On the other hand, the unallocated resources have been transferred to reserves which will subject to new programming under the 9th EDF.

Lastly, the annual payments in 2004 can be summarised as follows:

§ Lomé (6th, 7th and 8th EDF ) : EUR 1.193 million;

§ Cotonou (9th EDF) : EUR 1.054 million (allocation A : EUR 655 million and allocation B : EUR 144 million, regional projects : EUR 12.27 million and intra ACP debt relief : EUR 100 million).

Total payments in 2004 : EUR 2.248 billion.

PURPOSE: presentation of the Commission’s Financial Management Report on the 6th, 7th, 8th and 9th European Development Funds for the year 2004.

CONTENT: This Report fulfils the Commission’s obligations under Articles 96, 102 and 135 of the Financial Regulation applicable to the 9th European Development Fund . Article 96, paragraph 2 requires that the EDF accounts shall be accompanied by a report on financial management containing an accurate description of the achievement of the objectives for the preceding financial year, in accordance with the principle of sound financial management and of the financial situation and the events that had a significant influence on the activities carried out.

The Communication focuses on the following main points:

1) Achievement of objectives for the 2004 financial year: In 2004 the Commission made global commitments from the EDF of €2 648m – just below (the €2 850m) target – and paid out a record €2 464m, continuing its recent year-on-year acceleration in disbursements. New individual commitments (contracts) for an amount of €3 038m were concluded on the EDF instruments managed by the Commission. This contracts performance over 2003-2004 (€6 100m) is unprecedented and should contribute to a continued upward trend in disbursements over the coming years.

- Fight against poverty : The Commission devoted the greatest share of EDF commitments in 2004 to regional integration and institutional support. This covers programmes to promote respect for human rights, the principles of democracy, the rule of law and responsible, accountable government, and to strengthen the institutions on which these conditions depend. Other programmes seek to prevent conflict by supporting nascent peace processes, democratic reforms, and efforts to create political and social stability (e.g. the Commission launched the €250m African Peace Facility in 2004, through which the EC funds non-military aspects of peace-keeping operations by the African Union). The Commission also continued to devote considerable resources to infrastructure, in which it has many years’ experience, notably launching the ACP-EU Water Facility for which a first allocation of €250m was made available immediately out of the €1 000m unreleased funds of the 9th EDF. General budget support and sectoral policy support programmes continued as the Commission’s preferred development cooperation strategies - where conditions allow - encouraging partner government-led initiatives to tackle poverty. General budget support programmes constituted 18% of new programmes approved in 2004, supporting ten countries. In addition, eight sectoral policy support programmes were launched to a total global commitments value of €242m.

- Improving operational performance:The Commission completed projects and responded to emerging needs and emergencies with greater speed than in the past,e.g. Darfur (Sudan). To raise the quality of programmes, headquarters staff undertook in-depth quality reviews on all new project proposals early in the design process. One in four proposals was also selected for further review at a later stage. The Commission also leveraged the skills and expertise of its staff to replicate examples of best practice in different sectors (e.g. 40% of EuropeAid’s (non secretarial) officials participated in best practice networks). To improve programme design, the Commission consolidated its independent results-oriented monitoring of EDF-funded programmes launched in 2002,6 raising the ACP budget by 30% (to €4.6m). The Commission also made substantial efficiency gains, by for example, formally devolving responsibility for programmes from its headquarters to its offices in 24 more ACP countries (at the end of 2004, 79% of ongoing EDF-funded programmes were managed by in-country officials).

2) Financial situation at the end of 2004: At the close of 2004, the Commission had allocated in total €43 802m net to ACP countries under the 6-9th EDFs. This comprised €29 898m from the 6-8th EDFs (all committed, since €2 990m in uncommitted balances had been transferred into the 9 th EDF) and €13 904m from the 9th EDF.7 Of the total allocated (€43 802m), the Commission has committed €35 692m and paid €25 914m. The unspent €17 888m comprises uncommitted funds of €8 110m and unspent commitments (Restes à Liquider) of €9 779m.

3) Events that had a significant influence on activities carried out in 2004: 2 types of events affected the smooth operation of 2004 funding:

- Payment delays due to treasury shortages : The Commission had difficulty in making timely payments in May-June and, to a lesser degree, at the end of 2004. This was largely because it had paid an

unprecedented amount in the year to June, and the EDF treasury system relies on a rather inflexible ‘just in time’ contribution system from Member States. Prudent cash management (including the bringing- forward of the second call for contributions) meant that priority payments were made in time, but overall payments were delayed considerably.

- Political instability and other crises : The Commission estimates that around 20% of ACP countries are in crisis or post-crisis at any one time, and in 2004 political uncertainty continued to affect cooperation in several states, and added significant complexity to the running of regional programmes. (e.g., in Côte d’Ivoire). Several delegations found dialogue difficult with local authorities, especially with Somalia, Togo, Haiti, Liberia, Sudan, Zimbabwe, Guinea, Equatorial Guinea and Côte d’Ivoire, as well as with the Central African Republic).