The aim of EU policy is to encourage sustainable development that helps to eradicate poverty in developing countries and integrate those countries into the global economy. At the same time, these goals are coupled with a political plan to reinforce democracy and the rule of law, while promoting respect for human rights and basic freedoms.
EU development cooperation is designed to complement the policies of the Member States and, where possible, to coordinate with the other donors at global level, whether countries or international organisations.
Today, the European Union is the world's leading development partner, in terms of aid, trade and direct investment. Together, the EU and its Member States provide 55% of all official international development aid.
The EU budget is the general financial instrument, with appropriations being granted on the basis of two main approaches:
- a geographical approach centred on three zones (Mediterranean basin, Asia and Latin America, southern Africa). The aid, granted in the form of donations, is mainly for financial, technical and economic cooperation;
- a thematic or sectoral approach, using specific budget headings. The beneficiaries are all around the world, including the ACP countries. The most important aspects are food aid, humanitarian aid and cooperation with NGOs.
Besides the EU budget, development cooperation is also funded through two more specific financial instruments:
- the European Development Fund (EDF), which is fed by contributions from Member States, calculated according to a specific distribution key;
- the European Investment Bank (EIB), which grants loans in the context of its external activities.