Sector Budget Support
BS – new type of EU Assistance
As above mentioned, the European Neighbourhood Policy Instrument (ENPI) approved in 2007 provides general/sector budget support (and other aid instruments) in addition to technical assistance to ENP countries, whereas the TACIS programme only allowed for technical assistance.
The change in the approach of the EU, its member states and other donors to support the third counties was backed by two documents – the European Consensus on Development and the Paris Declaration on Aid Effectiveness.
Implementation of budget support as an ENPI instrument is specified by Article 15 Regulation (EC) No 1638/2006 of the European Parliament and of the Council of 24 October 2006 on laying down general provisions establishing a European Neighbourhood and Partnership Instrument, ‘Community assistance may also be used for sectoral or general budget support if the partner country’s management of public spending is sufficiently transparent, reliable and effective, and where it has put in place properly formulated sectoral or macroeconomic policies approved by its principal donors, including, where relevant, the international financial institutions’.