The EU is playing a leading role in helping to relieve the external debt burden on poor countries. In 1999, the EU and its African, Caribbean and Pacific partners decided that unallocated funds in the European development fund could be used to fund debt relief, primarily through the heavily indebted poor countries – HIPC – initiative, in an international response to the debt crisis. Approximately €1 billion from the EDF is being used for this purpose, of which €734 million constitutes the EU's contribution to the HIPC trust fund at the World Bank which finances the relief of debt owed to multilateral financial institutions. The remainder is being used to write off debt owed directly to the EU. This is the largest single donation to the HIPC trust fund and amounts to about one third of the total donor pledges received.
The HIV-AIDS crisis presents an unprecedented challenge to development, particularly in Africa where the disease now infects one in four of the adult population in some countries. The EU's commitment to tackling the impact of the HIV-AIDS pandemic is reflected in its contribution of over $1 billion to the global fund for AIDS, TB and malaria. This is the largest single contribution by any donor. The EU also adopted a comprehensive new policy on HIV-AIDS, malaria and TB in November 2000.
The EU has been working to ensure that the multilateral rules on intellectual property rights, the so-called TRIPs Agreement, do not restrict the access of developing countries to life-saving medicines at affordable prices. The EU strongly supported the adoption of a declaration on TRIPs and access to medicines at the WTO ministerial meeting in Doha in November 2001. I attended that meeting on behalf of the last Government. The Doha declaration recognises that developing countries can take exceptional measures, such as issuing compulsory licences for the domestic manufacture of patented medicines, in the case of public health emergencies. It also allows the least developed countries to defer application of pharmaceutical patents until at least 2016. This means that generic medicines can be imported by these countries without restrictions until then. However, the Doha declaration does not address the problem of countries that have little or no domestic manufacturing capacity and cannot, therefore, avail of compulsory licences. This week the EU tabled a proposal at the WTO in Geneva for a technical modification of the TRIPs agreement to help resolve this problem.
Additional informationThe EU has also proposed the establishment of a global tiered pricing system for life-saving medicines. Under such a system, medicines would be sold in developing countries at heavily discounted prices. The establishment of a tiered pricing system would require safeguard measures to ensure that the discounted medicines were not smuggled back into the markets of developed countries. The European Commission is discussing the technical details of a global tiered pricing system with the pharmaceutical industry and with other key markets, such as the US.
The food needs of developing countries are a major concern for the EU. The EU has responded rapidly to the emerging food crisis in southern Africa. On 30 May the development Council underlined its concern by adopting a declaration, proposed by Ireland, which called on major donors to respond urgently to the developing crisis. The EU has also provided emergency assistance to help alleviate the impact of the crisis. On 24 June the European Com mission allocated €6 million for victims of food shortages in Zimbabwe. The funds will mainly be used to distribute food to the poorest families in the most seriously affected districts of the country, to provide targeted nutritional support for children and to assist farm workers who have been affected by the land resettlement programme. This is in addition to a further €1.5 million which the Commission intends to allocate to the growing food crisis in Malawi. The Commission has also made a number of recommendations to improve the effectiveness of the EU's food aid and food security policy, a key element of the Union's reaction to famines and food crises. These recommendations should help make EU food aid more effective and responsive in meeting the needs of developing countries.
The EU is the world's largest donor of humanitarian aid and the fifth largest donor of development aid. If the contributions of the member states are included, the EU is by far the largest source of global ODA. The scale and scope of the EU's development assistance programme, which encompasses debt relief, support for the alleviation of the diseases of poverty, food security and humanitarian relief and assistance, underline the EU's solidarity with some of the poorest countries in the world.