ANNEX II TO FINANCING AGREEMENT N°…
TECHNICAL AND ADMINISTRATIVE PROVISIONS
BENEFICIARY
COUNTRY / REGION
REQUESTING
AUTHORITY
BUDGET HEADING
TITLE
TOTAL COST
AID METHOD/
MANAGEMENT
MODE
DAC-CODE
2011
Caribbean Forum of the ACP States (CARIFORUM)
Regional Authorising Officer
10th EDF CRIP (A envelope)
CSME and Economic Integration Programme
€ 28,800,000
th
10 EDF: €27,500,000
CARICOM Secretariat: €1,300,000
Project approach
non-decentralised management:
CSME and Economic Integration programme: direct centralised
management through the signature of a grant contract with the
Caricom Secretariat and the NAOs of Haiti and Belize
Standby Facility: joint management through the signature of a
Contribution Agreement with the Caribbean Development Bank
33130
SECTOR
1
Regional Trade Agreements
TABLE OF CONTENT
1. DESCRIPTION
1.1 Objectives
1.2 Expected results
1.3 Activities and implementation timetable
2. LOCATION AND DURATION
2.1 Location
2.2 Duration
3 IMPLEMENTATION
3.1 Organisational set up and responsibilities
3.2 Reporting
3.3 Budget
4. MONITORING AND EVALUATION
4.1 Monitoring
4.2 Evaluation
5. INFORMATION AND VISIBILITY
6. APPENDICES
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1. DESCRIPTION
The CARICOM Single Market and Economy (CSME) is the guiding instrument that steers the
regional integration and cooperation activities. The Single Market involves the free movement of
goods, services, skilled people and capital among member countries, the right of establishment of
CARICOM nationals anywhere in the Community, a common external tariff (CET) and a
coordinated foreign trade policy. The Single Economy requires macroeconomic policy
coordination, harmonization of laws and regulations, and Community-wide sectoral policies on
agriculture, industry, services and transport. Monetary Union, which already exists for the
members of the Organization of Eastern Caribbean States (OECS), is a more distant integration
goal for the Community as a whole.
In general terms, the 10th EDF CSME and Regional Integration Programme is based on the
regional integration provisions enshrined in the Revised Treaty of Chaguaramas and is part of the
Caribbean Regional Economic Integration and Cooperation Roadmap. The priorities are based on:
1) CARICOM's preference for the priority use of 10th EDF regional resources based on the
Roadmap and following intense technical and political consultations at CARICOM and
CARIFORUM levels;
2) The Work Programme to complete the establishment of the CSME (2004): both the 9 th and the
10th EDF CSME programme are integral part of this overall CSME Work Programme
3) The CARICOM Regional Statistics Work Programme (RSWP) of 2005;
4) A recent appraisal of the state of the CARICOM Single Market mandated by the Conference of
Heads of Government of the Caribbean Community;
The main recommendations of this appraisal are as follows:
The first is that in the three years since the declaration by the Member States of readiness to
operate the CARICOM Single Market and the commitment to proceed to the Single Economy,
there has been a noticeable decline in the public exchange about the economic integration project.
There is a need for remobilization at the national level around important areas of the economy with
intra-CSME cross border commercial prospects and the promotion of investment and employment
creation in those areas.
Second, and at the same time, there is need to complement the installation of the legal and
supporting infrastructure to operate an effective CSM. It is not possible to reap the rewards of
economic integration without first completing the investment.
Third, there is not sufficient capacity in place to operate CSME in several member States as well
as capacity to fully utilize the inter-regional preferences. Governmental capacity to operate the
various agreements under the CSME needs strengthening.
Fourth, free movement of skilled people and services is at the heart of the integration project and
so a balance must be reached between Member States’ concerns regarding security, competition
within domestic labour markets and demand for publicly provided goods and services on the one
hand and the pursuit of the Community’s objective of full employment of the factors of production
on the other.
Fifth, the Right of Establishment is important and a fully harmonized regime is needed including
the primary laws governing establishment of commercial presence as well as collateral factors such
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as access to credit in the domestic markets of Member States, access to public services at the same
rate as nationals, the opening up of procurement markets to stimulate cross border activity and free
and open competition.
Arising from the establishment of the CSME is the need to harmonise statistics in the Region. The
RSWP was developed with the objectives to focus on the statistical needs to establish monitor and
evaluate the CSME; to make available statistical information for evidence-based decision-making;
and to keep pace with the socio-economic, environmental changes and technological advances
relative to the context for statistical development. The RSWP has been the basis of the activities
funded under the 9th EDF and will be as well for the 10th EDF proposed activities in the area of
statistics in support to the CSME programme.
A logical framework is attached. It may be updated or adapted without an amendment to the
financing agreement as long as these modifications do not change the objectives and expected
results of the project.
1.1. Objectives
The overall objective of the programme is to support the beneficial integration of the CARICOM
states into the global economy through the advancement of the CARICOM Single Market and
Economy.
The specific objectives of the programme are:
1: To further advance the CARICOM Single Market and Economy (CSME)
2: To advance regional and sectoral policies
The programme will address human rights, gender equality and environmental sustainability in
many ways.
Human rights of the peoples of the Caribbean were reaffirmed in 1997 through the adoption of the
Charter of Civil Society (including gender equality). A special gender advocacy programme has
recently been launched with special emphasis on violence against women. CARICOM has drafted
model legislation against domestic violence and developed action plans and core indicators to
guide member states. The CARCIOM Social and Development Crime Prevention Plan of Action
(proposed for support under the social sector programme of the CRIP) has also incorporated
violence against women.
The CSME programme is non-discriminatory in general and has no special focus on gender
equality, but one of the activities under result 1.1 will have a particular impact on women:
establishment of contingent rights. These rights concern access to social services in the host
country for dependents of the migrant worker (mostly women and children); it is therefore not so
much a gender equality issue but an activity that has a positive impact on spouses of migrant
workers, who happen to be mostly female.
In addition, the programme has a special focus on environment: results (1.7) and (2.3) specifically
target the integration of environmental concerns into regional and national policies.
1.2. Expected results
The expected results are as follows:
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1. CSME
1.1. Provisions of the Built-In Agenda of the Revised Treaty implemented
1.2. CSME regulatory and market regimes administration strengthened
1.3. Framework and regime for managing Integration of CSME Labour Markets improved
1.4. Monetary cooperation and fiscal policy coordination advanced
1.5. Belize and Haiti increasingly participate in the CSME
1.6. Ownership of the CSME by CARICOM nationals increased
1.7 Intra-regional statistical systems strengthened to produce and disseminate timely, high quality
and harmonised statistics for monitoring and establishing the CSME
2. Regional and Sectoral Policies
2.1. External Trade and Economic relations between CARICOM and DR deepened
2.2. Implementation of Strategic Plan for Regional Development (SPRD) advanced
2.3. Environmental concerns integrated into CARICOM regional policy
2.4. Amendments to the seven (7) policy areas of the Revised Treaty of Chaguaramas completed.
In addition, it is intended to increase the capacity at national level in order to implement projects or
activities from the elements of the CSME programme that need to be implemented at the national
level.
1.3. Activities and implementation timetable
The following expected results and associated main activities have been identified based on the
problem analysis presented in the Project Identification Fiche and on the priorities identified in the
appraisal report of the CSM. The proposed statistics activities are based on the RSWP.
1. CSME
1.1. Provisions of the Built-In Agenda of the Revised Treaty implemented
1.1.1. Create the Integrated CSME Procurement Market instruments and infrastructure
1.1.2 Enact legislation governing the Rights Contingent on movement of people and capital
1.1.3. Establish institutional and operational arrangements for CSME E-commerce regime
1.2. CSME regulatory and market regimes administration strengthened
1.2.1. Complete the Intra-CSME Right of Establishment regime
1.2.2. Strengthen enforcement and administrative competence on Restrictive Business Practices
1.2.3. Enhance Intra-CSME Cooperation and Coordination System to regulate and enforce
Consumer Protection Protocols
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1.3. Framework and regime for managing Integration of CSME Labour Markets improved
1.3.1. Establish Labour Market Information Systems for proper management of the regime for Free
Movement
1.3.2. Draft legislation for transferability of social security benefits and consumer protection
1.4. Monetary cooperation and fiscal policy coordination advanced
1.4.1. Hold consultations with Member States for adoption of a Monetary Cooperation Protocol
and Agreements for Currency Convertibility
1.4.2. Develop Models for a Regional Deposit Insurance facility and credit bureau mechanism to
assist in promoting financial stability in the Community
1.4.3. Provide technical assistance for the Regional Programme for fiscal policy coordination and
harmonization
1.4.4. Establish support for efficient administration of CARICOM Double Taxation Avoidance
Agreement
1.5. Belize and Haiti increasingly participate in the CSME
Particular attention to these two countries is needed as they are among the less advanced with the
implementation of the CSME. Haiti is the newest Member State to participate in the CSME and
has severe institutional constraints which have been further compounded by the earthquake. Belize
has been identified in a recent study as facing major challenges to its effective participation in the
CSME (such as fiscal adjustments, human resources constraints, etc..) which are further
complicated by its geographical location. The appraisal report of the CSM also identifies
Competition enforcement as a particular area which needs support in Belize.
1.5.1. 1.5.1. Belize implements CSME integration activities, in particular in the area of
competition policy and law
1.5.2 Haiti defines the articulation between his implication in the CSME process and the
post-earthquake development plan
1.5.2. Haiti completes its national development plan and legislative and administrative
measures for CSME
1.5.3. Haiti implements CSME integration activities
1.6. Ownership of the CSME by CARICOM nationals increased
1.6.1. Review and implement the Comprehensive CSME Communication Plan
1.6.2. Educate CARICOM nationals on CSME integration and cooperation policies and strategies
1.7. Intra-regional statistical systems strengthened to produce and disseminate timely, high quality
and harmonised statistics for monitoring the CSME
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1.7.1- Assist with the production, updating and harmonisation of economic statistics, of core social
and gender statistics, of core environment statistics and of ICT statistics through a set of capacity
building measures and technical assistance;
1.7.2. Design of a statistical monitoring system for the CSME and provision of training for its
implementation.
2. Regional and Sectoral Policies
2.1. External Trade and Economic relations between CARICOM and DR deepened
2.1.1.
Promote implementation of the CARICOM-DR FTA
2.1.2. Address outstanding commitments by the Parties under the Protocol implementing the
Agreement
2.1.3
Strengthening Political and Economic Relations between CARICOM and the
Dominican Republic
2.2. Implementation of Strategic Plan for Regional Development (SPRD) advanced
2.2.1. Consult Member States on the integration of regional policies into their national
development plans
2.2.2. Assist Member States in integrating the agreed regional policies into their national
development plans
2.2.3. Provide technical assistance to Member States for the implementation of the SPRD at the
national level
2.3. Environmental concerns integrated into CARICOM regional policy
2.3.1. Develop a common implementation strategy for the community environment and natural
resource policy framework
2.3.2. Develop a common environmental regulatory regime
2.3.3. Implement policy framework strategy and complementary support activities at the national
level
2.4. Amendments to the seven (7) policy areas of the Revised Treaty of Chaguaramas completed
2.4.1. Inter-Governmental Task Force (IGTF) meet on amendments to the Treaty
2.4.2. Drafting of instruments & protocols to amend the Revised Treaty
2.4.3. Hold national consultations to review draft amendments to the Revised Treaty
2.2.4. Approval of the proposed amendments to the Revised Treaty
2.2.5. Member States implement the Amendments to the Revised Treaty
An indicative implementation table is attached.
In addition, a CSME Stand-by Facility for Capacity-building of an estimated €3.45
million will be created with the purpose of ensuring that the CSME is also implemented at
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national level (lack of national administrative capacity being a major bottleneck as
identified by the CSME appraisal and the last ROM report). The Standby facility will
provide capacity-building support measures for CARICOM Member States directly linked
to national implementation of elements of the 9th and 10th EDF CSME Programme. In
view of the limited funds available, the scope of the facility will initially be limited to 9th
and 10th EDF intervention areas, but it could be extended to the CSME Work Programme
as a whole (if successful the fund could be increased at mid-term or with other
development partners's contributions).
Project applications will have to demonstrate the need for the requested support in relation
to implementation of a concrete (9th or 10th EDF) CSME activity, and the applicant will
have to report both on the use of the funds (specific capacity-building measures) and the
results on the implementation of the CSME activity in question. The CSME Focal points
in CARICOM Member States will also be able to access the facility in view of their
coordinating and monitoring role for CSME. The interventions will include areas such as
competition law, procurement, technical barriers to trade, Sanitary and Phyto-Sanitary
Measures, Labour Markets, Monetary cooperation, Fiscal policy etc. In view of the
variety of needs in the different Member States, the scope of the capacity-building
measures themselves is broadly defined: technical assistance, training, supplies, staff.
2. LOCATION AND DURATION
2.1. Location
The location of the operation is the Caribbean Forum of the ACP States. Most departments of the
CARICOM Secretariat involved in the implementation of the programme are located in Guyana,
except the CARICOM CSME Unit which is based in Barbados.
For the standby facility, the Caribbean Development is located in Barbados.
2.2. Duration
The execution period of the Agreement will be as specified in Article 5 of the Special Conditions.
3. IMPLEMENTATION
3.1 Organisational set-up and responsibilities
A Financing Agreement will be signed between the European Commission and the Regional
Authorising Officer of the Caribbean Forum of the ACP States (CARIFORUM), who will have the
overall responsibility for the Programme which will be implemented through a mixture of
direct centralised and joint management.
CSME and Regional Integration: Implementation by the European Commission
The method of implementation of the CSME and integration Programme will be direct centralised
management. A Grant contract will be directly awarded and signed between the EU delegation in
Guyana and the CARICOM Secretariat on the basis of paragraph 6.3.2 of the Practical Guide to
contract procedures for EU external actions. As the principal administrative organ of the
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Community, the CARICOM Secretariat has the de jure monopoly to support the CARICOM
Member States with the implementation and establishment of the CSME. Therefore a call for
proposal is not appropriate. The RAO will appoint the National Authorising Officer of
Belize and Haiti as Deputy RAO to implement the activities to be carried out in these
countries. Direct grant contracts will be signed between the Commission and the DRAOs
as they have the de jure monopoly to implement the CSME at national level.
CSME Standby Facility: Implementation by the Caribbean Development Bank
The method of implementation of the Standby Facility will be Joint Management through the
signature of a standard Contribution Agreement with the Caribbean Development Bank (CDB) in
accordance with Article 29 of the Regulation (EC) No 215/2008 on the financial regulation
applicable to the 10th European Development Fund. The international organisation complies with
the criteria provided for in the applicable Financial Regulation. The CDB has already experience in
managing a similar scheme funded by DFID, CARTFUND. The CDB will be responsible for
conducting due diligence and forwarding successful proposals to a Steering Committee, consisting
of representatives of the Commission and the CARICOM-Secretariat for approval. Following
approval, the CDB will proceed with contracting, disbursement of resources and monitoring and
evaluation of project activities. Applications should be channelled through the National Authoring
Officers of the CARICOM countries, which will be implementing partners, signalling that the
proposed national level actions are supported at Member State level. In order to ensure that
CARICOM Member States with a lesser capacity also access the Facility, the CDB will provide
technical assistance to improve proposals where needed.
In due consideration of the principle of ownership, the European Commission reserves its right to
change the organisation indicated above or the scope of the delegation, without this necessarily
requiring an amendment to the financing agreement. In that case, it shall consult the Beneficiary on
this change and notify to it the name of the new organisation and/or the scope of the task(s)
delegated to it.
The 10th EDF CSME Programme forms an integral part of the overall CSME Work Plan. It is for
this reason that it is difficult, if not impossible, to see the 10th EDF (or the 9th EDF) programme as
a self-standing project with a dedicated project management structure. The CSME Work Plan is
implemented by the CARICOM Secretariat as a whole, with contributions from all Directorates
and Units but principally from the Trade and Economic Integration Directorate (Single Market,
Single Economy, Customs, Sanitary and Phyto-sanitary Measures), the Human and Social
Development Unit (Environment, Labour, Consumer Protection), Foreign and Community
Relations Directorate (CARICOM/Dominican Republic Relations) and the Offices of the
Secretary-General (PIU, Audit); the Deputy Secretary-General (Finance, Administration,
Procurement, Human Resource Management, Strategic Planning, Monitoring and Evaluation,
Statistics) and the General Counsel (Treaty review; drafting legislation; other legal issues
including contracts). The CSME Work Plan spans a number of areas and disciplines which are
covered by the various Directorates; however, the Directorate of Trade and Economic Integration
is directly responsible for its implementation. This Directorate is headed by an Assistant
Secretary General supported by a CSME implementation Unit based in Barbados. The
management structure for the 10th EDF CSME Programme is therefore to a large extent the same
as for the overall CSME Work Plan. The 10th EDF CSME Programme will be an integrated part of
the day to day work of the Secretariat with regards to the overall CSME Work Plan.
The CARICOM Secretariat has a limited pool of resources to fully implement this CSME Work
Plan and as such it seeks to engage its development partners to assist with facilitating faster
implementation and execution of the work plan. Building upon the 9th EDF, the modality for
implementation under the 10th will require institutional support for the Secretariat in a number of
specialized areas; the specifics of these arrangements will be discussed prior to the signature of
the Agreement. The responsibility for project oversight will rest with the Deputy Secretary-
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General or his/her representative. Effective project management will be monitored and controlled
through a Project Coordinating Team (PCT) which will meet on a monthly basis. These
meetings, which will be chaired by the Deputy Secretary- General or his/her representative, will
require Programme/Project Managers to report on the progress of their activities and identify any
challenges which may impede progress. Decisions will be made on actions to be taken to ensure
smooth implementation of activities. A Programme Steering Committee (PSC) will be
established which comprises one representative of the Community Council (of Ministers of
CARICOM), one representative of Council for Trade and Economic Development (COTED) and
one representative of the Secretary-General of CARICOM and shall meet on an annual basis. The
Delegation of the European Union (Guyana) shall attend all Committee meetings as an observer.
The Programme Steering Committee will be required to:
 Give overall policy guidance and support to the programme.
 Review the performance of the programme, including all relevant reports and provide direction;
 Report to Community Council (of Ministers of CARICOM).
3.2 Reporting
The reporting requirements in the context of the Grant contract to be signed with the Caricom
Secretariat and the NAOs in Haiti and Belize will be those set out in the general conditions
applicable to European Union financed grant contracts for external actions. The reporting
requirements in the context of the Contribution Agreement to be signed with the Caribbean
Development Bank will be those set in the general conditions applicable to European Union
contribution agreements with International organisations. Additional reporting requirements may
be set out in the special conditions.
3.3 Budget
The total project cost is estimated at EUR 28,800,000 million, of which 27,500,000 million shall be
financed from the 10th EDF RIP in the framework of the revised ACP-EU Partnership Agreement,
€1,300,000 million by the CARICOM Secretariat.
Cost €
1. CSME and Regional and sectoral
and regional policies
23,050,000
3,450,000
2. Standby Facility for the CSME
Audit and
programme)
Evaluation
(of
this
Contingencies1
500,000
500,000
Total EU Contribution
27,500,000
CCS Contribution (staff positions)
1,300,000
TOTAL
1
28,800,000
The European Union's contribution to the "Contingencies" heading may be used only with prior agreement of the
Commission
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4. MONITORING AND EVALUATION
4.1 Monitoring
Performance monitoring of the 10th EDF Programme shall be integral part of the general
performance monitoring of the overall CSME Work Programme that is managed by the
Secretariat's M&E unit. The performance indicators that will be used shall be the same as those
for the relevant parts of the CSME Work Programme (as recommended by the last ROM report
and as already implemented under the 9th EDF CISP Programme). Progress reports shall report
on the CSME Work Plan as a whole – distinguishing between the regional and national level
(i.e. after the system for the latter has been designed and implemented– and highlight the areas
supported under the 10th EDF. The reporting modalities may be adjusted in view of donor
agreement on harmonised reporting.
The Commission may carry out Results Oriented Monitoring (ROM) via independent
consultants, starting from the sixth month of project activities, which will be finalised at the
latest 6 months before the end of the operational implementation phase.
4.2 Evaluation
a) The Commission will carry out external evaluations via independent consultants, as follows:

possibly, a mid-term evaluation mission;

a final evaluation, at the beginning of the closing phase;

possibly, an ex-post evaluation.
b) The Beneficiary and the Commission shall analyse the conclusions and recommendations of
the mid-term evaluation and jointly decide on the follow-up action to be taken and any
adjustments necessary, including, if indicated, the reorientation of the project. The reports
of the other evaluation and monitoring missions will be given to the Beneficiary, in order to
take into account any recommendations that may result from such missions.
c) The Commission shall inform the Beneficiary at least one month in advance of the dates
foreseen for the external missions. The Beneficiary shall collaborate efficiently and
effectively with the monitoring and/or evaluation experts, and inter alia provide them with
all necessary information and documentation, as well as access to the project premises and
activities.
5. COMMUNICATION AND VISIBILITY
The Programme shall implement a Public Relations and Communications Plan. The visibility
guidelines of the European Union with regard to EU funded programmes shall be respected.
6. APPENDICES
Appendix I – Logical Framework
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Appendix II – Budget
Appendix III – Indicative operational timetable
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