Commission Hosts Discussions on U.S. - EU Development

UNCLAS SECTION 01 OF 04 BRUSSELS 000916

SENSITIVE
SIPDIS

STATE FOR EUR/ERA KESSLER, WILLIAMS
STATE FOR EEB/IFD/ODF NUTTER, LAITINEN
STATE FOR EEB/TPP/ABT/ATP CLEMENTS
STATE FOR NSC GAYLE MURPHY
USDA for FAS/OSTA Froggett
USDA for FAS/OCRA Nenon
State Pass to USAID FOR NNICHOLSON, NOMEARA, JHILL
E.O. 12958: N/A
TAGS: EAID EIND ETRD SENV EUR ECON EAGR TPHY TSPL
SUBJECT: Commission Hosts Discussions on U.S. - EU Development
Coordination

BRUSSELS 00000916 001.2 OF 004



1. (SBU) SUMMARY: On June 15-16, the European Commission hosted a
Technical Meeting on Development in Brussels. The meeting was a
continuation of a series of discussions between the U.S. and EU
aimed at promoting a renewed trans-Atlantic dialogue on development.
Sessions were held on food security, regional economic integration
in Africa, and the development aspects of climate change, including
both adaptation and mitigation. USAID proposed several concrete
next steps, including joint missions at senior policy levels in
Africa focused on food security, EU-US meetings on the margins of
various multilateral meetings such as the upcoming African Union
Summit, an exchange of technical papers, and a more detailed
discussion on aid effectiveness. USG participants underscored the
importance of tangible outcomes in the field arising out of any
policy dialogue in order for it to hold interest for our senior
policy makers. END SUMMARY

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BACKGROUND
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2. (SBU) Building on a series of informal discussions beginning in
early 2009 in Brussels, Paris and Washington, U.S. and EU
development officials agreed to hold two-day technical discussions
on potential areas of cooperation and dialogue in Brussels in mid
June. The meetings, hosted by the Commission but also involving
broad member state participation, focused on food security, regional
integration, and the development aspects of climate change. At
various times, aid effectiveness and Millennium Development Goals
(MDGs) also figured in the discussions. U.S. participants included
State, USAID, and MCC, while the EU was represented by various
elements of the Commission as well as almost all member states. The
United Kingdom made only a very brief appearance during the
concluding session. Talks continued during an EC hosted dinner on
June 15 as well as in side conversations at the Commission on the
afternoon of June 16.

3. (SBU) In opening remarks, USG interlocutors updated EU
colleagues on current administration views on development. Norm
Nicholson, head of USAID's Bilateral and Multilateral Donor Division
within its Office of Development Partners (ODP),stressed the new
administration's commitment to engaging with multilateral actors.
He also noted President Obama's interest in doubling the size of
U.S. development assistance by 2015 and renewed commitment to the
MDGs. Richard Morford, Managing Director of Donor and Multilateral
Relations for the Millennium Challenge Corporation (MCC) described
the MCC's work in some of the poorest countries in the world and
said there is scope for greater cooperation. All USG speakers
reiterated that a policy dialogue for its own sake was not
sufficient, that broad inter-agency participation in a series of
discussions at many levels is essential, and that senior level USG
participation in more formal sessions would be predicated on a
demonstration that talks would lead quickly to tangible progress in
the field.


4. (SBU) In response, Director for EU Development Policy Maciej
Popowski agreed, emphasizing the need to continue in an operational
mode. He also highlighted the importance of a "whole of government"
approach as well as a field-level focus. Representatives from the
outgoing Czech presidency underlined the importance of continuing to
move toward a formal dialogue process and proposed further
discussions at the next U.S.-EU task force. Looking ahead to the
Swedish presidency, the Swedish representative affirmed that the
Swedish Presidency planned to invest "a lot of energy" in U.S.-EU
development coordination.

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FOOD SECURITY
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5. (SBU) The discussion of food security was energetic, broad in
scope, and viewed by many as the most fruitful aspect of the
meetings. After listening to presentations on EU and U.S.
initiatives, Popowski described both approaches as broadly similar.
He also suggested that the true challenge lies in an effective
field-level and country-led implementation of those strategies.
Potential areas of cooperation raised by various EU member states
included both field-level and policy issues: joint baseline studies
and needs assessments; charting the transition from emergency to
development; a focus on purchasing power; exchanging priority
countries to identify overlap; the importance of private sector

BRUSSELS 00000916 002.2 OF 004


investors; early warning systems; and nutrition programs for
pregnant and lactating mothers, infants, children and women.


6. (SBU) USAID and Commission counterparts had a lively exchange on
the role of social safety nets. USAID and MCC officials noted an
emphasis on social supports had distracted donors from focusing on
economic growth strategies. Economic growth produces revenues which
help to sustain public sector expenditures on safety nets over the
long run. Commission officials agreed, but added a sole focus on
production cannot be successful without supporting social mechanisms
in parallel. EC experts continued that access to food is a critical
element, not only increased production. Finland emphasized the
crucial role of economic growth in alleviating food insecurity and
highlighted the importance of coordination among all players
involved. The US emphasized in response that food security was
rooted in increased productivity and rising incomes, but agreed that
food security was a broader concept than productivity increases and
that these aspects were integral to the proposed U.S. approach.


7. (SBU) In response, USAID proposed joint U.S.-EU missions at the
senior policy level to selected countries in Africa to assess the
effectiveness of ongoing food security initiatives in the field and
look for ways to strengthen them. Importantly, both sides should
concentrate on areas where political will and technical ability are
present. A key outcome will be joint country visits to bring
political and technical focus to produce country level efforts that
work effectively and improve aid effectiveness.

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REGIONAL INTEGRATION
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8. (SBU) In contrast to the previous session, the regional
integration discussion mostly involved an exchange of information
without reaching conclusion on specific concrete plans aimed at
promoting greater cooperation. The Commission noted a desire for
closer ties with USAID on two of their recent assessments covering
energy and transport and water.


9. (SBU) USAID emphasized the need for greater capacity building in
the regional economic communities (RECs). Various interventions
cited a number of upcoming events that offer opportunities to engage
such as the next AU Summit and World Trade Organization Aid for
Trade meeting. Lastly, USAID suggested a regional economic
integration partnership, which would bring each side together to
identify important and concrete areas to engage RECs.


10. (SBU) Nicholson pointed out there is not "universal agreement"
in Washington that a development dialogue is needed and exhorted
attendees to craft a dialogue that would "make a significant
difference" in the field. He challenged the EU side to work with
the U.S. to find areas of cooperation and to identify strategic
issues "that are worthy of inclusion in the upcoming U.S.-EU
Summit". To that end, Nicholson offered to host meetings on the
margins of the upcoming African Union (AU) summit to discuss
regional integration in a practical context. As a starting point,
he suggested that the U.S. and EU could together pick one or two
regions where greater U.S.-EU cooperation would make a difference.


11. (SBU) In a separate side meeting afterwards, agreement was
reached to jointly support a roundtable or conference on regional
economic integration in Africa later in the year, possibly in
November 2009. Serious consideration will also be given to a donor
coordination meeting in West Africa organized around the corridor
development agenda and the related aid for trade agenda. Such a
meeting would require follow-up with ECOWAS to determine timing.
Commission counterparts requested that the dialogue be focused on an
exchange between head quarters for the time being. The Commission
also asked for an exchange of information on regional efforts and
opportunities for cooperation around pastoral issues, especially in
East Africa.

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WORKING DINNER
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12. (SBU) The Commission hosted a small working dinner on June 15,
resulting in some measure of progress and a general consensus that a

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renewed "development dialogue" could usefully engage a broad range
of development actors in both the U.S. and EU. The goal is to
improve cooperation and achieve concrete, field-level results. There
was broad agreement that such cooperation can benefit significantly
from better discussions at the policy level (and vice versa) and
that discussions need to involve all agencies involved in
development-related work. The necessity of rethinking the
Millennium Development Goals (and beginning to think of possible new
approaches after the 2015 MDG target date) was also discussed, with
Popowski underscoring the "need to go beyond ODA as we now know it."
Other topics of discussion included ways to engage with China in its
role as an emerging donor and current U.S.-EU discussions
anticipated in the lead up to several upcoming international
events.


13. (SBU) The link between the technical level dialogue and broader
political level policy discussions is not entirely clear either
within the EU or the U.S. Nor is it entirely evident that the broad
EU membership or the EU Presidency is necessarily the most
appropriate context for some policy issues. It was agreed that
further discussion would be needed to develop a policy agenda and to
discuss the value added of such a discussion within the
transatlantic dialogue.

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CLIMATE CHANGE
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14. (SBU) The second day of meetings opened with a session on
climate change. Commission officials suggested more focused
cooperation in four main areas: adaptation; disaster risk reduction;
reducing emissions for deforestation; and the integration of climate
change concerns into national development strategies, focused on EU
initiatives begun in the 2006-2007 timeframe. William Breed,
Director of the USAID Director Global Climate Change Team, stated
that he was "reassured" by Commission comments about leaving the
negotiations to the UNFCCC process and added that the U.S. also saw
additional opportunities to work together. He pointed to extenson
of the SERVIR Earth Observations Hub as a platform for adaptation
planning, greenhouse gas inventories, forest monitoring, and red
tides as one possible venue, as well as jointly developing guidance
manuals and tools for adaptation and several concrete opportunities
for cooperation on clean energy. Concerned that EU counterparts
were speaking in overly general terms focusing on dialog rather than
action on the ground, he requested a more detailed side conversation
later in the afternoon, after the formal meeting was adjourned.

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FINAL REMARKS
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15. (SBU) Ahead of final remarks, Jeff Hill, USAID's Senior Advisor
for Agriculture within the Africa Bureau, put forward several
concrete options for regional integration cooperation, including
work related to development corridors, trade capacity building,
value chains, scorecard methodologies and harmonization. In closing
for the U.S. side, Nicholson affirmed the usefulness of the
discussion, noting that he saw opportunities for "modest, doable,
concrete" areas of cooperation that could make a difference in the
field. He also suggested further talks around aid effectiveness,
social safety nets, and the need to discuss donor approaches beyond
the MDG target date of 2015. Popowski agreed while also suggesting
that the meetings "demonstrated a new spirit of cooperation" and he,
too, saw a stronger commitment to continue in an operational mode in
parallel with policy dialogue. Czech Perm Rep Petr Halaxa
underscored the opportunities for future cooperation and committed
the outgoing presidency to maintain support for the development
dialogue in its remaining weeks in office. As the meeting
concluded, Henrik Ceferin from the Swedish Ministry of Foreign
Affairs stressed the need for concrete results and affirmed that the
Swedish presidency will work to ensure that all member states are
aware of the initiative and support it.

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NEXT STEPS
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16. The U.S. as well as representatives from the Commission, Czech

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and Swedish presidencies and various member states committed to
continuing the development dialogue in the months ahead. Practical
next steps include efforts now underway to launch joint field visits
focused on food security issues in the fall. Ongoing efforts to
facilitate technical discussions with technical people in both
Washington and Brussels will also proceed, as indeed happened only a
few days after the Brussels meeting when the senior Commission
official responsible for health policy and programs briefed USAID
counterparts in Washington on EU approaches in this sector. While
not wishing to create new coordination structures, both sides will
also look for opportunities to meet on the fringes of other
international events involving senior development officials from
both the U.S. and the EU. Depending on interest, more focused side
meetings on specific development issues can also be arranged.
"European Development Days," scheduled to take place in Stockholm in
late October, provides another opportunity to engage. In this
regard, the Swedish presidency informally raised the possibility
that the new USAID Administrator, if confirmed by that time, might
want to participate in a high level discussion with European
development ministers that would likely take place on October 21 in
Stockholm.

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COMMENT
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17. (SBU) The Commission, with support from the Czech and Swedish
presidencies, has great interest in formalizing a high level
dialogue on development, a dialogue that may well be in USG
interests to support. That said, issues of "who speaks for Europe"
remain. Most member states attended the meetings but major donors
such as Germany and UK participated only briefly and contributed
little to the discussion. Also, the technical meetings at times
reflected a tendency to speak in broad generalities, discuss policy
concerns in ways that aren't rooted in field reality and focus on
noble aspirations rather than achievable results. Side discussions
revealed that Commission staff have little capacity or capability to
engage in new activities, citing understaffing. There may be some
near-term possibility to engage in workshops or to frame our
suggestions as fulfilling EC aspirations. Previous dialogue efforts
between the E.U. and the US in the late 1990s foundered due to
concerns that time spent talking only rarely resulted in concrete
proposals or made a practical difference in the field. Looking
forward, these elements remain vital and must be continually
emphasized if this renewed effort to promote a trans-Atlantic
dialogue on development is to succeed.


MURRAY