“The European Financial Architecture for Development: evolution or revolution?”, Mikaela Gavas

TEPSA has coordinated a briefing requested by DEVE Committee of the European Parliament. The briefing was authored by Mikaela Gavas, Co-Director and Senior Policy Fellow, Development Cooperation in Europe Programme, Centre for Global Development, United Kingdom, and Ilaria Giustacchini, Project Manager at the Trans European Policy Studies Association (TEPSA). The briefing is entitled “The European Financial Architecture for Development: evolution or revolution?”.

Thisbriefing looks at progress on the European Financial Architecture for Development (EFAD). It highlights challenges associated with the current European development finance ecosystem and the European Union’s (EU) positioning at the centre of this system through its development policy and financial instruments. In summarising attempts to streamline EFAD, whilst analysing the merits and pitfalls of the action plan – the so-called ‘Status Quo Plus’ – agreed by the European Council in 2021, three possible scenarios are discussed. These are: the establishment of a dedicated EU development bank; a formalised division of labour based on competitive advantage; as well as a more structured and harmonised system to be controlled by the European Commission. The briefing concludes that most plausible, effective and efficient scenario is for the European Commission to act as a more unifying central force, setting and enforcing policy guidelines, as well as ensuring a clear and coherent policy steer. It provides recommendations for enhanced European Parliament control and scrutiny of EU development policy and finance as well as further political guidance on the future and implementation of EFAD.

Download the full briefing here.