European Parliament: procurement policies and illicit flows vital to policy coherence for development

Added 02 Nov 2012

On 25 October the European Parliament voted through a resolution calling for better alignment of all EU policites to development objectives. The resolution, led by MEP Birgit Schnieber-Jastram (EPP, DE) was passed with the overwhelming support of 561 votes in favour and only 47 against and 51 abstentions. The European Parliament explicitly supports key demands of Eurodad and our members on tax and sustainable procurement, building pressure on EU institutions and governments to improve EU development cooperation and to increase developing countries' policy space to promote nationally owned development policies.

In a blow to the Commissions controversial Agenda for change policy paper, the parliament explicitly states that "the European Consensus on Development ... remains the doctrinal framework for the EU's development policy, and that any attempt to revise or replace it in the context of the ‘Agenda for Change’ should involve the institutions that permitted its creation." It adds that the whole concept “is not merely a technical issue, but primarily a political responsibility, and that Parliament …. has a key responsibility for translating the commitment into concrete policies.” 

Sustainable procurement

As public procurement accounts for 19% of world GDP, the resolution recognises the huge potential that public procurement has “to be a tool of implementing sustainable government policies both in the EU and in its ODA recipient countries.”

Procurement ranks highly thoughout the document, which includes some of the key asks of Eurodad and allies, including fair trade groups, regarding the revision of the public procurement directive. According to the resolution, “public procurement should be effectively used to achieve the overall EU objectives of sustainable development and, therefore, that the future of public procurement directives should enable sustainability criteria to be integrated throughout the process.”

Also in line with Eurodad demands, the resolution calls for giving “contracting authorities the policy space to make informed pro-development procurement choices.” This reference is timely, given the current discussion surrounding the reciprocity regulation put forward by the European Commission that promotes the liberalisation of  procurement markets in developing countries.

Tax and development

The resolution explicitly mentions the negative impact of illicit financial flows in mobilising domestic resources in developing countries and consequently in promoting sustainable development policies. At the same time, the resolution supports Eurodad's call for greater financial transparency, arguing that “it is essential for supporting revenue mobilisation and combating tax evasion.”

The resolution also demands that “the current reform of the EU Accounting and Transparency Directives should include a requirement for extractive and timber companies to disclose payments made governments on a project-by-project basis, with reporting thresholds that reflect the size of the payments from the perspective of poorer communities.” Although this not as ambitious as hoped for, and does not include the crucial need for the framework to be expanded to country by country reporting, it is important that the parliament explicitly recognises the relevance of fighting against capital flight in the light of policy coherence for development.