EUROPEAN COMMISSION
Brussels, 3.9.2025
SWD(2025) 625 final
COMMISSION STAFF WORKING DOCUMENT
EX-ANTE EVALUATION
Accompanying the document
Proposal for a
COUNCIL DECISION
amending Council Decision (EU) 2021/1764 of 5 October 2021
on the association of the Overseas Countries and Territories with the European Union including relations between the European Union on the one hand, and Greenland and the Kingdom of Denmark on the other
{COM(2025) 599 final} - {SWD(2025) 626 final}
MULTIANNUAL FINANCIAL FRAMEWORK
2028 – 2034
EU PARTNERSHIP WITH
THE OVERSEAS COUNTRIES AND TERRITORIES
DRAFT LEGAL PROPOSAL
EX-ANTE EVALUATION
Staff Working Document
TABLE OF CONTENTS
1.Introduction: Political and Legal Context
2.Performance and EU Added Value
3.Lessons Learned and Challenges
4.‘Single Option’ Explanation
5.Proposed Changes (Amendments)
LIST OF ACRONYMS
ACP States:
African, Caribbean and Pacific States
A/MAP:
Annual/Multiannual Action Plan
AU:
African Union
CBD:
Convention on Biological Diversity
CEF:
Connecting Europe Facility
CRM:
Critical Raw Materials
CRMA:
Critical Raw Materials Act
DOAG:
Decision on the Overseas Association, including Greenland
DRR:
Disaster Risk Reduction
EC:
European Commission
ECF:
European Competitiveness Fund
EDF:
European Development Fund
EEC:
European Economic Community
EEZs:
Exclusive Economic Zones
EFIs:
External Financing Instruments
EFSD+:
European Fund for Sustainable Development Plus
EIB:
European Investment Bank
EIT:
European Institute of Innovation and Technology
EU:
European Union
EUROSTAT:
Statistical Office of the European Union
FA:
Fisheries Agreement
FWC:
Framework Contract
GE:
Global Europe
GG:
Global Gateway
GO Programme:
Green Overseas Programme
IPA:
Instrument for Pre-Accession Assistance
LAC:
Latin America and the Caribbean
MIP:
Multiannual Indicative Programme
MMF:
Multiannual Financial Framework
MoU:
Memorandum of Understanding
MS:
Member States
NDICI:
Neighbourhood, Development and International Cooperation Instrument – Global Europe
OAD:
Overseas Association Decision
OCTA:
Overseas Countries and Territories’ Association
OCTs:
Overseas Countries and Territories
ODA:
Official Development Assistance
OECD:
Organisation for Economic Cooperation and Development
OR:
Outermost Regions
PDAC:
Prospectors & Developers Association of Canada
SDGs:
Sustainable Development Goals
SFA:
Sustainable Fisheries Agreement
SFPA:
Sustainable Fisheries Partnership Agreement
SIDS:
Small Islands Development States
TFEU:
Treaty on the Functioning of the European Union
UN:
United Nations
UNFCCC:
United Nations Framework Convention on Climate Change
UNOC:
United Nations Ocean Conference
This ex-ante evaluation of the European Union (EU) partnership with the Overseas Countries and Territories (OCTs) has been developed in close alignment with the orientations of the upcoming Multiannual Financial Framework (MFF)
and in line with EU policy priorities. By embedding the analysis in this guiding context, the document:
-Outlines the main features of the EU-OCTs partnership,
-Elaborates on the performance of the partnership and the EU added value,
-Examines lessons learned and challenges,
-Explains a ‘single option’ for the implementation of the partnership, and
-Proposes recommendations for the next MFF.
The following Chapters present a structured analysis of these dimensions.
_____________________________________________________________________________________
1.Introduction: Political and Legal Context
The thirteen European Union (EU) Overseas Countries and Territories (OCTs) are all islands, located in the Arctic, the Atlantic, the Caribbean, the Indian Ocean, and the Pacific, with a combined population of ca. one million people. All of them have their exclusive economic zones (EEZs) that, together, constitute the world's largest EEZ, covering over 15 million square kilometres.
The OCTs are associated with the EU and constitutionally linked to Denmark (Greenland), France (six OCTs) and the Netherlands (six OCTs), on which they depend to varying degrees as non-sovereign countries or territories. Most OCTs enjoy wide-ranging autonomy, covering areas such as economic affairs, public health, home affairs and customs. Defence and foreign affairs usually remain within the remit of the respective EU Member States (MS).
The OCTs are part of the related EU MS, but not part of the EU (unlike the EU’s outermost regions). This means that even if they are not part of the EU, they cannot be considered as third countries either. This status affects the nature of the EU’s presence in Greenland and New Caledonia where the Union is not represented by EU Delegations or Commission Representations, but by Commission Offices.
Although not third countries, the OCTs do not form part of the single market and the Schengen area, nor are they bound by the EU’s acquis. They are subject to their own legislation in accordance with the respective distribution of competences with their EU MS. In areas such as human rights and gender equality, the OCTs’ legal frameworks are in line with the fundamental principles upheld by the EU. The citizens of the OCTs are EU citizens (via their citizenship of related EU MS) with full citizens’ rights throughout the EU.
The EU is an important political, commercial and cooperation partner for the OCTs. The association partnership between the OCTs and the EU dates back to the Treaty of Rome (1957) and is enshrined in Part IV of the Treaty of the Functioning of the EU (TFEU – Articles 198 to 204).
According to the TFEU (Article 198):
“The purpose of association shall be to promote the economic and social development of the countries and territories and to establish close economic relations between them and the Union as a whole. In accordance with the principles set out in the preamble to this Treaty, association shall serve primarily to further the interests and prosperity of the inhabitants of these countries and territories in order to lead them to the economic, social and cultural development to which they aspire.”
The successive Overseas Association Decisions (OADs) have defined a specific legal framework for the association partnership - reaffirming close historical, political, economic and cultural ties between the OCTs and the EU.
The current legal framework is established by the Council Decision on the Overseas Association, including Greenland (DOAG). It provides a single legal basis for all the OCTs with a dedicated budget chapter.
DOAG merges the former Greenland Decision with the last OAD as part of the simplification effort under the 2021-2027 Multiannual Financial Framework (MFF) to reduce the number of external financing instruments, thereby streamlining their architecture and performance. The merge was also driven by the end of the European Development Fund (EDF) that was providing financing to the OCTs other than Greenland (for the bilateral envelope). Greenland has a specific place in DOAG, notably because of its historical ties with the EU and the related uniqueness of the partnership (see Chapter 2.1.2).
In line with the TFEU provisions, DOAG (Article 1) establishes (i) an association of the OCTs with the Union, “… which constitutes a partnership to support the OCTs’ sustainable development as well as to promote the values and standards of the Union in the wider world. The partners to the association are the Union, the OCTs and the Member States to which they are linked.” and (ii) a funding programme for the association for the period 2021-2027 (EUR 500 million).
The general objective of DOAG (Article 3(4)) reflects the purpose of the association as defined in the TFEU:
“… to promote the economic and social development of the OCTs and to establish close economic relations between them and the Union as a whole. The association shall pursue this general objective by enhancing the OCTs’ competitiveness, strengthening the OCTs’ resilience, reducing their economic and environmental vulnerability and by promoting cooperation between them and other partners. Furthermore, the aim of this Decision is to preserve the existing ties between the Union on the one hand, and Greenland and Denmark on the other, acknowledging the geostrategic position of Greenland in the Arctic, and to preserve existing ties between the Union and the other OCTs, acknowledging their geostrategic positions in the Caribbean, the Indian Ocean, the Atlantic and the Pacific.”
The specific objectives of DOAG (Article 3(5)) are the following:
“(a) to foster and support cooperation with OCTs, including in addressing their major challenges and reaching the SDGs, (b) to support and to cooperate with Greenland in addressing its major challenges such as the raising of education level and to contribute to the capacity of the administration of Greenland to formulate and implement national policies.”
Unlike other EU external financing instruments, DOAG has - except some general references - no explicit poverty reduction focus, knowing that out of the thirteen OCTs only Wallis and Futuna is eligible for Official Development Assistance (ODA).
Whilst migration is part of the EU’s substantive approach to international cooperation, it is not mentioned as an area of collaboration under DOAG.
DOAG is based on three pillars: dialogue, trade and financial cooperation. It provides for the institutional framework of the partnership, specifies unilateral trade preferences, and sets rules for effective programme implementation, to pursue the objectives of the partnership.
DOAG consists of the 48 recitals, the body text (94 articles) and 4 Annexes:
·Annex I:
Union Financial Assistance
·Annex II:
Concept of ‘Originating Products’ and Methods of Administrative Cooperation
·Annex III:
Temporary Withdrawal of Preferences
·Annex IV:
Safeguard and Surveillance Procedures
The OCTs association (OCTA) serves as a platform through which the OCTs promote their common positions at international fora and coordinate the implementation of the EU-OCTs partnership. The
Ministerial Conference
is the highest decision-making authority. It appoints a rotating
Chair
who is the head of the organisation and elects an
Executive Committee
, supported by the OCTA Secretariat, whose task is to manage statutory activities.
Since 2020, OCTA has been facing significant institutional and administrative challenges. It has failed to fully assume its coordination roles towards the OCTs and, in that respect, to develop productive working relations with the EU. In response to these challenges, OCTA adopted its internal reform agenda in 2024, calling for greater strategic orientation and improved governance to ensure more accountability, efficiency, and transparency. However, its implementation timelines and modalities, as well as first tangible deliverables are yet to be seen and communicated by OCTA (as of July 2025).
2.Performance and EU Added Value
The performance assessment and the added value analysis of the EU’s action in relation to the OCTs have used a number of sources, in particular:
·DOAG was part of a global mid-term evaluation of the EU External Financing Instruments (EFIs) in May 2024.
·The Annual Reports from the Commission to the Council on the Implementation of the Financial Assistance provided to the OCTs and the Annual Programme Performance Statements include further relevant and detailed information.
·Some OCTs, such as Greenland, French Polynesia, and Saint Pierre and Miquelon, have been evaluated using the Public Expenditure and Financial Accountability (PEFA) methodology, which measures the performance of public finance management systems against internationally recognised standards.
In addition, regular progress and monitoring reports, final implementation reports, annual reports provided for the budget support payment requests, as well as field visits, mission reports, and aide-mémoires of dialogue meetings served as a useful source of information for this evaluation.
2.1Performance
The sources mentioned above demonstrate DOAG’s consistently high performance towards achieving the desired outcomes. In particular, they show that DOAG:
·Is on track to effectively deliver its objectives, reaffirming the strategic dimension of the partnership.
·Has successfully integrated the former Greenland Decision and is delivering on the partnership with Greenland.
·Has promoted coherence with the broader EU financing architecture.
2.1.1DOAG is on track to effectively deliver its objectives, reaffirming the strategic dimension of the partnership
DOAG has been meeting its objectives by providing an adequate institutional framework for dialogue, promoting trade relations and ensuring effective financial cooperation, by focusing on actions of mutual interest to the OCTs and the EU.
ðDialogue
DOAG defines three types of dialogue: the OCTs-EU Forum, trilateral consultations, and working parties, with all involving the Commission, EU MS, and the OCTs (with OCTA representing their collective interests).
The annual OCTs-EU Forum is a political platform, gathering the OCTs’ Presidents/Prime Ministers (and other relevant political leaders), the EU Commissioner for International Partnerships, and Ministers from EU MS. By ensuring high-level representation, the Forum helps underline the importance attached by all sides to the OCTs-EU partnership.
Based on feedback received from the OCTs and EU MS, trilateral consultations offer an effective platform for political and policy dialogue at technical level to exchange relevant information, reflect on priority topics of mutual interest and monitor progress in implementing DOAG. The focus in 2023-2025 was on trade and trade-related cooperation (see below), policy issues (including ocean governance and digital connectivity), climate finance, as well as the preparations of the OCTs-EU Forum and the ‘Green Overseas’ Climate Finance Conference.
Working parties can be organised ad hoc on specific, demand-driven subjects. As many topics were already covered by trilateral consultations, no working parties’ meetings were organised in 2023-2024.
The Commission also maintains a biannual policy dialogue with Greenland (see Chapter 2.1.2).
The different types of dialogue mentioned provide each side of the partnership with the space needed to discuss and strengthen cooperation across the full spectrum of the OCTs-EU partnership. Nevertheless, the frequency of some of the events, in particular the annual OCTs-EU Forum, should be reviewed to see what the most effective occurrence is to get the most out of the event.
ðTrade and Trade-related Cooperation
DOAG trade and investment provisions promote close economic relations between the OCTs and the Union as a whole and demonstrate shared commitment to sustainable development. Financial cooperation (see below) is implemented in close complementarity with these provisions.
The OCTs enjoy unilateral duty-free and quota-free access to the EU common market for all goods that meet the rules of origin criteria laid down in DOAG. This includes processed and unprocessed products, raw materials, and manufactured goods. The OCTs are allowed to cumulate origin with the EU and with other OCTs (meaning products can be considered as originating in an OCT even if they contain material or undergo processing in other OCTs or the EU, providing certain conditions are met). This is an important provision that supports regional trade integration and OCT’s participation in global/EU value and supply chains.
As for trade in services, the OCTs benefit from the most favoured nation treatment, namely the most favourable treatment that the EU agreed with other partners in the past or will in the future. On the EU’s side, the OCTs grant the EU the most favourable treatment applicable to any “major trading economy”.
Considering the different levels of development across the OCTs, the OCTs-EU trade relations are characterised by asymmetry, i.e., the EU has a less favourable access to the OCTs’ markets (for both goods and services), and the OCTs can adopt a series of measures (including duties and tariffs towards the EU) to support their economic development through local production and labour markets.
DOAG places a strong emphasis on the twin transition, encouraging the OCTs to explore green/blue trade and investment opportunities in sectors such as eco-tourism, sustainable raw materials, fisheries and renewable energy – accompanied by digital solutions. In this context, DOAG promotes regional partnerships to help integrate the OCTs into larger regional markets, making their economies more resilient.
While each OCT has a distinct economic profile, the most important trade and investment sectors in cooperation with the EU include:
·Fisheries and aquaculture (many OCTs have large Exclusive Economic Zones).
·Agriculture and agro-industry (including niche products like tropical fruits and spices).
·Tourism services (representing a great share in the local economies, while also generating demand for goods and attracting investments).
·Renewable energy and environmental services (increasingly important in the context of climate change).
Eurostat data (2023) show the OCTs-EU total trade, worth ca. USD 5 billion, has seen a 46% increase since 2014. Greenland, New Caledonia and French Polynesia have the highest share in total trade with the EU, flagging their importance in the overall OCTs-EU trade relations.
In addition to offering unilateral preferential market access and investment opportunities, the EU provides technical and financial assistance to the OCTs to help them build their export capacity, meet EU standards, as well as improve business environment and investment climate. This includes support for private sector development, investment-friendly policy framework, vocational training, and infrastructure improvements.
ðFinancial Cooperation
The implementation of the DOAG financial envelope is progressing smoothly, with all 16 Multiannual Indicative Programmes (MIPs) adopted and over EUR 350 million already programmed (70% of the total EUR 500 million DOAG allocation). The total amount of commitments reached ca. EUR 288 million by the end of 2024 (58% of the total DOAG allocation).
The programmes (bilateral/territorial, regional and intra-regional) accurately reflect DOAG objectives, prioritising sustainable development under the umbrella of the Global Gateway, including the promotion of a green and blue economy, climate change adaptation and mitigation, disaster risk reduction, digital connectivity, education, food security, as well as tourism and culture. This ensures close alignment with the EU policy agenda, and key international frameworks, including the Paris Agreement, the 2030 Agenda for Sustainable Development, the Sendai Framework, and the Global Biodiversity Framework.
The main modality of bilateral/territorial cooperation remains budget support, which provides a direct and predictable flow of funds to OCTs’ governments. It reinforces ownership and aligns financial assistance with national development strategies and public policy objectives - with a clear impact on the OCTs’ legal framework. The modality has proved to effectively serve as a lever for reforms. For example, in New Caledonia, it has enabled the adoption of the 2023 Energy Transition Plan. In Sint Eustatius, it supported institutional restructuring and development of a plan to strengthen government capacity in agriculture, livestock, and fisheries sectors. And in Saba, the EU assistance to the Energy Policy 2020-2025 supports government efforts to increase the share of renewable energy to 60%.
DOAG also strongly promotes regional cooperation (implemented through a classical project approach). The three programmes for the Caribbean, the Pacific and the Indian Ocean regions are being developed to foster cooperation among the OCTs of the same geographical zone, sharing similar challenges and priorities, including in food security and marine biodiversity sectors (e.g., the fight against the sargassum algae in the Caribbean). The design of the regional programmes is based on lessons learned from previous programmes financed under the 11th EDF:
·PROTEGE in the Pacific has successfully promoted sustainable and climate-resilient economic development, as well as best agricultural and fisheries practices among the OCTs.
·RESEMBID in the Caribbean has strengthened crisis and disaster management capabilities of the OCTs, enhanced their legislative and institutional capacities in managing marine biodiversity, as well as supported energy efficiency.
·RECI in the Indian Ocean has also recorded several important achievements, such as enhanced biosecurity, ecological restoration, and the eradication of invasive species on selected islands.
Since the establishment of DOAG, intra-regional cooperation within the regional cooperation financial envelope has been ringfenced to encourage cooperation and promote win-win partnerships between the OCTs and their neighbouring ACP/non-ACP states and territories, as well as with the EU’s outermost regions. The overarching goal is to strengthen the OCTs’ role in relevant EU regional strategies, in line with the priorities of the Global Gateway. This type of cooperation, which is innovative in its concept and implementation, is still under assessment (as of July 2025) and the work will continue to prepare actions under the corresponding MIP, for example, on digital connectivity in the Caribbean.
The available technical assistance has been used in a targeted and effective way to support the design and implementation of programmes, and the organisation of dialogue meetings (e.g., the OCTs-EU Forum). Further initiatives include a DOAG communication campaign ‘Partners in Change’ launched in early 2024 to promote the EU-OCTs partnership; the OCTs’ Youth Network fostering youth engagement and dialogue; administrative support to OCTA (however, associated with challenges – see Chapter 3.3) and a dedicated training programme to strengthen OCTs’ capacity to engage in Union programmes.
Under the non-allocated fund (a DOAG reserve for unforeseen circumstances, emerging challenges and new initiatives) effective, ad hoc assistance has been provided to reconstruction efforts in New Caledonia (following the 2024 crisis). Further actions cover an all-OCTs programme promoting culture, creative industries and sustainable tourism, as well as the contribution to a facility supporting investments in the Critical Raw Materials (CRM) sector in the OCTs.
2.1.2 DOAG has successfully integrated the former Greenland Decision and delivers on the partnership with Greenland
Since 1985, the EEC/EU and Greenland have built a long-standing and mutually beneficial partnership, based on equality and shared values.
Through the Exit Agreement, Greenland obtained an OCT status as defined in the Treaties establishing the European Communities and has been covered by consecutive dedicated OADs (see Chapter 1), applicable to all the OCTs, and the fisheries agreements. However, the Exit Agreement specified that Greenland, while having an OCT status, would not be on the same terms as other OCTs and that “additional specific provisions are needed to cater for Greenland”.
Consequently, Greenland, unlike other OCTs, has not had automatic full duty- and quota-free access to the EEC/EU market. The free access for fisheries products (over 90% of Greenland’s exports) has always been dependent on a fisheries agreement that should be “satisfactory to the Union” ().
Furthermore, until 2020, Greenland although covered by the OADs, did not benefit (unlike other OCTs) from respective financial cooperation under the EDF: bilateral financing was guaranteed under the EEC/EU budget: in 1985-2006 – under the Fisheries Agreement (FA); and in 2007-2020 – under the Sustainable Fisheries Agreement (SFA) and two consecutive Greenland Decisions. Under the current MFF, the partnership is governed and financed by DOAG and the Sustainable Fisheries Partnership Agreement (SFPA).
DOAG merges the former Greenland Decision with the last OAD as part of the simplification effort under the 2021-2027 MFF (see Chapter 1). This set-up works well: it protects the strong partnership with Greenland developed over the years and contributes to EU’s strategic objectives in the Arctic. It also maintains relevant provisions of the former Greenland Decision, including strategic narrative, biannual policy dialogue and a specific financial envelope. Greenland receives EUR 225 million (45% of the total DOAG allocation), and possible support under the intraregional, technical assistance and non-allocated envelopes) - the largest per capita support in the OCTs. This allocation reflects previous political commitments (DOAG refers to the 2003 Council Conclusions on Greenland) and remains comparable to the reference amount under the two Greenland Decisions. The allocation is used for education and green growth sectors, including the CRM.
Since 2007, education (along with fisheries) has been the cornerstone of the partnership. In the period 2007-2020, under both Greenland Decisions, it represented 100% of the financial envelope and it still represents 90% of the DOAG allocation. The EU support has been crucial for the development of the sector, raising education levels, improving vocational training, and empowering young Greenlanders. The focus of the current Education Programme (budget support) is on further enhancing the quality, efficiency, and inclusiveness of the education system, in line with the Greenland’s 2024–2030 education strategy which is an integral part of the country’s long-term development vision for sustainable growth. The objective is to support Greenland in its efforts to build a skilled workforce needed for developing economy (see below).
Under DOAG, financial cooperation with Greenland evolved beyond education to new areas of mutual interests under the Green Growth Programme (accounting for the remaining 10% of the budget), including CRM, renewable energy, tourism, environmental protection, and research. The Programme promotes sustainable value and supply chains for more diversified and resilient economies. Several key milestones serve as a tangible demonstration of the EU's continuous commitment to the partnership, including the implementation of the Sustainable Raw Materials Roadmap, and the support provided to the new Greenland’s Plan for Energy and the Arctic Hub.
The visit of the European Commission President Ursula von der Leyen to Greenland in March 2024, culminating in the inauguration of the Commission Office in Nuuk, further strengthened momentum in developing the partnership. With this renewed impetus, biannual policy dialogues with Greenland took a more strategic shape, extending the policy spectrum of the bilateral engagement to green growth sectors as well as digital transformation and connectivity. This has translated into specific actions to support the investment agenda under the Global Gateway, including the first-ever EU-Greenland business mission in Nuuk in October 2024, a joint EU-Greenland event at the PDAC convention in Toronto in March 2025, and three Greenland-focused sessions during the EIT Raw Materials Summit in Brussels in May 2025.
2.1.3DOAG has promoted coherence with the broader EU financing architecture
In terms of implementation, unless otherwise specified, DOAG refers to the provisions Neighbourhood, Development and International Cooperation Instrument – Global Europe (NDICI), streamlining procedures through a common regulatory frame and increasing alignment between both basic acts. It maintains a simplified programming process, including a single Annual/Multiannual Action Plan (A/MAP) per OCT, except for Greenland, and per region (covering the entire MFF) and does not require a mid-term review, reflecting the long-term and tailored nature of the association.
To enhance effectiveness, strategic alignment, and complementarities among relevant Union programmes and external financing instruments, DOAG introduces a new level of flexibility in its implementation modalities, namely mechanisms allowing for the combination of funding (i.e., joint projects) to achieve common objectives, provided that costs are not duplicated. This flexibility did not exist under the EDF but so far it has not been widely applied because of procedural issues.
To support the objectives of the partnership, DOAG also specifies the eligibility and access of the OCTs (as beneficiaries and/or participants) to:
·Relevant Union programmes (e.g., InvestEU, Horizon Europe, Erasmus+, Connecting Europe Facility: CEF, Creative Europe, LIFE/BESTLIFE) and
·External financing instruments (horizontal envelopes and rapid response actions under NDICI - but not EFSD+ - as well as the humanitarian aid).
With over EUR 50 million EUR allocated to nearly 350 projects during the 2021-2024 period, the scale and impact of OCTs’ engagement with Union programmes have markedly increased, compared with the previous MFF. The number of projects has tripled, and funding has surged tenfold since the 2014-2020 period.
Efforts to boost participation in programmes, including via technical assistance and dedicated training provided by the Commission are ongoing/in demand, reflecting both their relevance for the OCTs and OCTs’ growing interest to access diverse funding streams. However, this progress has not been evenly distributed among the OCTs (with Aruba, French Polynesia, and Greenland absorbing 80% of the funding) and programmes (with CEF, Erasmus+, and LIFE/BESTLIFE concentrating over 80% of the overall allocation). It is also worth noting that InvestEU, which enable the preparation and financing of Global Gateway projects, has not been used so far.
To ensure a greater impact and delivery on the strategic objectives, there is a need to strengthen coherence with the broader EU financing architecture.
2.2 EU Added Value
DOAG’s added value lies in its ability to address the purpose of the association as defined in the TFEU (see Chapter 1): “… to promote the economic and social development of the countries and territories and to establish close economic relations between them and the Union as a whole” that individual EU MS (even those having special links with the OCTs) could not achieve on their own.
With increasing global competition, the OCTs assume renewed importance as strategic outposts of Europe, members of the European family within their respective regions, that bolster EU’s global presence by helping advance EU’s interests and promote EU’s values throughout the four corners of the world. It is reflected in the EU Strategy for Cooperation in the Indo-Pacific, the EU's Arctic Policy ‘A Stronger EU Engagement for a Peaceful, Sustainable and Prosperous Arctic’, and the 2023 Agenda for Relations between the EU and Latin America and the Caribbean. Also, the Samoa Agreement considers the geostrategic importance of the OCTs for the cooperation with the African, Caribbean, and Pacific (ACP) states and provides for their observer status in joint institutions established under the Regional Protocols. The OCTs are also present in the Communication on the EU’s outermost regions
This stronger strategic importance is also reflected in DOAG where the OCTs and their sustainable development needs are part of the EU’s response to global challenges. DOAG achieves this by enhancing OCTs’ competitiveness, strengthening their resilience, and reducing their economic and environmental vulnerability, while promoting cooperation between them and other partners, including ACP/non-ACP states and territories and the EU’s outermost regions, under the umbrella of the Global Gateway. Such action at Union level is considered necessary to ensure effective integration of the OCTs into relevant EU’s regional/global initiatives and the related value and supply chains, driving sustainable development.
As a party to most multilateral and regional processes, the EU also engages (including financially) with key international players in key policy areas relevant for the OCTs, including climate change, ocean governance, biodiversity loss, and food security. This leverage enables the EU to project globally its policies and values (shared with the OCTs), as well as influence the shaping of global norms and regulatory standards (benefiting also the OCTs).
None of the EU MS acting alone would be able to adequately address the scale and the geographic scope of these challenges, as well as to mobilise the required level of the political support, financing and technical expertise. The EU is better suited to manage large-scale cooperation that transcends national borders and to leverage economies of scale.
Compared to individual national actions, the EU, together with its MS, can achieve greater impact by incentivising and pooling together public and private investments to the benefit of the OCTs (e.g., for possible mining and renewable energy projects in Greenland and New Caledonia, and digital initiatives in the Caribbean), and by coordinating common positions and speaking with a stronger voice in multilateral and regional fora on issues important for the OCTs.
And last but not least, the EU MS would not be able to take action with regard to the OCTs’ trade regime (see Chapter 2.1.1), as the common commercial policy is an exclusive competence of the EU.
3.Lessons Learned and Challenges
Based on the analysis of the performance and the added value of the EU action (see Chapter 2), the corresponding lessons learned, and challenges have been identified in the following areas:
·Adaptation to global trends and integration into regional economies.
·Coherence with the broader EU financing architecture.
·Effective dialogue.
They have been translated into a set of changes (amendments) proposed to the current DOAG (see Chapter 5).
3.1
Adaptation to global trends and integration into regional economies
The international landscape has changed significantly over the last years, appearing far less predictable. Geopolitical instability, climate change, risk of pandemics, trade tensions and the competition for technology and resources have an impact on the EU and the OCTs.
On top of these mounting global challenges, the OCTs face several structural challenges - notably (i) small domestic markets, (ii) geographic remoteness and high transportation costs, (iii) vulnerability to natural disasters, and (iii) fragile digital, energy and food supply chains – that hamper their development potential. The Covid-19 pandemic has further exacerbated their risk exposure, revealing severe impacts that global disruptions can have on their, usually mono-sectoral, economies.
Considering these inherently structural challenges and the great power competition in the Arctic, the Caribbean and the Pacific, a strong political signal regarding the EU’s continuous commitment to its partnership with the OCTs would be both of critical importance and very timely.
The OCTs represent unique and strategic assets that benefit the Union as a whole – including their geostrategic location, exceptional conditions for space and astrophysics research, abundant renewable energy potential, rich biodiversity, extensive maritime zones, and availability of mineral resources (Greenland and New Caledonia).
The EU has been a reliable partner for the OCTs and should continue leveraging their potential as geostrategic outposts. However, to take full advantage of the opportunities available in the current geopolitical context, a more ambitious and sustained cooperation and investment framework is needed, to help translate commitments into results – particularly, in support of the Union’s objectives on security, preparedness, economic security and regional/global value and supply chains, and competitiveness.
Global Gateway offers a win-win partnership, helping address structural challenges, increase competitiveness, diversify economies, and attract private investments: contributing simultaneously to the sustainable development of the OCTs and to the EU’s strategic interests.
However, the existing toolbox (under DOAG but also relevant Union programmes and external financing instruments) has not been sufficiently explored or fully available to the OCTs to effectively support this ambitious agenda (see Chapters 2.1.3 and 3.2). This challenge should be addressed under the upcoming MFF (see Chapter 5.2).
Regional and intra-regional cooperation have a strong potential to underpin this endeavour by creating economies of scale and synergies (e.g., via joint programming and implementation under relevant instruments, joint investments, etc.), and by establishing platforms to foster dialogue, mutual understanding and peer learning. However, despite DOAG’s clear provision for intraregional cooperation through ringfenced funding under the regional envelope, uptake and implementation remain limited. This suggests not only a need for clearer communication of strategic objectives and operational modalities, but also a more tailored and sustained capacity-building effort to ensure OCTs are equipped to identify, develop, and manage intraregional initiatives.
3.2
Coherence with the broader EU financing architecture
In terms of financial implementation that is currently framed within the NDICI Regulation (see Chapter 2.1.3), DOAG could benefit from greater flexibility and simplified rules, including for the programming process, the comitology procedure, and budgetary transfers.
An enhanced access to relevant Union programmes and external financing instruments (including the Global Gateway toolbox under Global Europe instrument) should further leverage the importance of the OCTs for the EU’s geostrategic agenda. However, this process is not aways straightforward with OCTs providing feedback that they need help in this regard.
The access to Union programmes is usually granted on a demand-driven and competitive basis with the rest of the European ecosystem. The evidence shows (see Chapter 2.1.3) that, indeed, some OCTs have succeeded in increasing their participation in a limited number of programmes, while many have still not been able to take full advantage of them.
Chapter 5.2 elaborates on how to address these challenges by further reinforcing DOAG’ coherence with the broader EU financing architecture.
3.3
Effective dialogue
Considering the geostrategic situation and underlying policy challenges (see Chapter 3.1), there is a need to further extend the spectrum of the dialogue to ensure stronger alignment of the partnership with the EU’s strategic goals, including via Global Gateway. This also covers the need to promote enhanced DOAG coherence with internal and external policies, as well as relevant Union programmes and external financing instruments.
The current dialogue structure, especially the annual OCTs-EU Forum and the four trilateral consultations each year, ensures a dynamic reciprocal engagement. However, the frequency of these interactions seems to dilute their strategic focus and impact. There appears to be limited added value relative to the number of meetings held and the preparations are highly time consuming for each side.
The Commission has been a strong supporter of OCTA for several years, recognising its role in representing collective interests of the OCTs in the implementation of the partnership, including as part of the dialogue. However, administrative deficiencies experienced by the organisation, as confirmed by several expenditure verification processes, hindered effective and fluent dialogue. Considering this, OCTA has not received any direct operating grants since January 2023 and has not been entrusted with any project implementation tasks. However, to maintain OCTA’s involvement in the dialogue and in recognition of the anticipated internal reform efforts (see Chapter 1), the organisation has been supported by dedicated technical assistance (managed by the Commission) to enhance its administrative capacities.
4.‘Single Option’ Explanation
Considering the legal provisions of the OCTs-EU partnership (see Chapter 1), there is no obvious alternative to DOAG.
Unlike the NDICI Regulation that establishes a funding instrument (2021-2027), DOAG is a Council Decision that establishes (i) an association of the OCTs with the Union in line with the Treaty provisions, and (ii) a funding programme for the association. Therefore, DOAG is one of the rare basic acts under the external action that does not have a sunset clause linked to the duration of the MFF (except for its funding programme).
Also, different legislative procedures apply to NDICI and DOAG: ordinary legislative procedure and special legislative procedure respectively.
For these reasons, NDICI and DOAG could not be merged and adopted as one package during the last MFF negotiations. And it has been decided that the same approach would apply for the upcoming MFF: a legal proposal for the EU partnership with the OCTs remains separate from the planned Global Europe due to its distinctive legal nature.
Chapter 2 confirms that the purpose, the objectives, the institutional framework of the association with its areas of cooperation, as well as trade provisions of the partnership, as reflected in DOAG, remain largely relevant and fit for purpose, providing the EU’s clear response to underlying policy goals. However, the funding programme for the association, considering its sunset clause, needs to be presented again, including its financial envelope and implementation modalities.
In this regard, only an amendment of DOAG is proposed under the upcoming MFF (see Chapter 5). The amendment will focus on the funding programme and consider the analysis in Chapter 3 to address identified challenges.
5.Proposed Changes (Amendments)
Based on the analysis of the performance and the added value of the EU action (see Chapter 2), and taking due account of the lessons learned and identified challenges (see Chapter 3), a set of amendments (see Chapter 4) is proposed to further enhance DOAG’s strategic dimension and to ensure more impact while delivering on the objectives of the EU-OCT partnership.
The amendments concern the DOAG body text and Annex I. Annexes II, III, and IV were significantly updated during the 2021-2027 MFF negotiations and remain fit for purpose.
The proposed changes aim at:
·Integrating DOAG better into the strategic investment agenda under the Global Gateway.
·Reinforcing coherence within the broader EU financing architecture.
·Enhancing structure and strengthening strategic focus of the dialogue.
5.1Integrating DOAG better into the strategic investment agenda under the Global Gateway
To bring the EU-OCTs partnership more in line with the commitments under the Global Gateway, it is proposed to merge allocations for territorial (bilateral) and regional cooperation and present them as two different global envelopes to finance:
(I)the cooperation with the OCTs other than Greenland, and
(II)the cooperation with Greenland,
while providing for flexible implementation modalities.
These two pillars will be complemented by a ring-fenced allocation for studies and technical assistance a well as by an unallocated emerging challenges and priorities cushion (a non-allocated fund), to increase flexibility as well as the ability of the Union to respond to unforeseen needs, building on the experience of the current DOAG.
It is also recommended to bring joint initiatives between the OCTs (currently ‘regional cooperation) as well as between them and ACP/non-ACP states and territories, EU’s outermost regions and relevant regional bodies (currently ‘intra-regional cooperation) under a single ‘regional cooperation’ framework. It would offer more flexibility in establishing effective partnerships to promote sustainable development and mutual learning. A specific reference to ‘intra-regional cooperation’ would therefore be deleted as obsolete.
The proposed approach would allow for greater flexibility in structuring financial cooperation and help apply the right mix of tools, including under Global Gateway, in a more targeted and interconnected way (see Chapters 3.2 and 5.2). This would further unlock investment opportunities in the OCTs and promote their more effective integration into EU’s/global value and supply chains and related regional initiatives - enhancing financial (and political) leverage and impact.
5.2Reinforcing coherence within the broader EU financing architecture
The ‘external’ DOAG dimension specifying the eligibility and access of the OCTs to relevant Union programmes and external financing instruments should be maintained, explicitly recognised and further reinforced via relevant cross-references. The objective is to promote increased complementarities of actions under the Global Gateway and stronger integration of the OCTs into the EU’s competitiveness agenda, including its value and supply chains.
To this end, it is proposed that:
·The OCTs are eligible for relevant components of the Global Europe, including its strengthened Global Gateway toolbox.
·The OCTs are included in the geographical scope of the European Competitiveness Fund (ECF) and other relevant Union programmes.
ECF’s comprehensive architecture would allow it to accompany OCTs’ Global Gateway-related projects along the entire investment journey, from research, through scale-up, industrial deployment, to manufacturing, in addition to and/or in complementarity with DOAG. The Fund could also help leverage and de-risk private investment.
For the implementation of financial cooperation, DOAG’s should refer to Global Europe to ensure access to an updated Global Gateway toolbox, including budget support, also in combination with policy-based loans, budgetary guarantees (e.g., the successor to EFSD+), blending and technical assistance, that would allow to build comprehensive investment support packages in the OCTs. By referring to the proposed Performance Regulation (via Global Europe), it would also benefit from streamlined procedures for monitoring, reporting, evaluation and communication.
Necessary exceptions should be introduced in DOAG to allow for more financial flexibilities and simplified rules to be applied to the comitology procedure for action plans and measures with relatively little funding, and to the programming process, i.e., replacing multiannual indicative programmes by annual or multiannual action plans in situations where one single action is planned for the entire MFF.
5.3Enhancing structure and strengthening strategic focus of the dialogue
It is suggested to have the OCTs-EU Forum every two years (instead of current annual meetings) and three trilateral consultations per year (instead of four). Working parties’ meetings, acting in an advisory capacity and convened on an ad hoc basis, should continue to complement the Forum and trilateral consultations.
The proposed schedule for the Forum would help avoid ‘summit fatigue’ and the lack of tangible progress between the events, as well as encourage more high-level political participation and strategic policy discussions. It would also better align with the frequency of other international fora, for instance, the EU-LAC (Latin America and the Caribbean) Summit or the EU- AU (African Union) Summit, that take place every 2 years, or less.
Trilateral consultations have been held, in practice, 3 times a year for the last few years, which has proven sufficient. They could be complemented by working parties’ meetings bringing together civil society and private sector actors, policymakers and financial institutions to advance the partnership under the umbrella of the Global Gateway.
The dialogue would benefit from a functional, efficient and transparent OCTA. Therefore, the current technical assistance should continue depending on OCTA’s political legitimacy and the progress on the related reform efforts.