I move:
That Dáil Éireann approves the Internal Agreement amending the Internal Agreement on the Financing and Administration of Community Aid of 20 November, 1979.
Before going into the details of the agreement which is the subject of this motion, I would first like to briefly explain the overall context in which it is set.
The second ACP-EEC Convention of Lomé which was approved by the Dáil on 6 December 1979 came into force on 1 January this year. This convention governs relations in trade, aid and other areas of co-operation between the European Community and 60 African, Caribbean and Pacific States. Under the terms of the convention, a country whose economic structure and production are comparable to those of the ACP States may, with the approval of the ACP-EEC Council of Ministers, accede to the convention by concluding an agreement with the Community.
Zimbabwe applied for accession immediately on achieving independence in April 1980 and on 4 November an agreement on the accession of Zimbabwe to Lomé II, together with a parallel agreement on products within the province of the European Coal and Steel Community, were signed in Luxembourg. Under these accords Zimbabwe will be entitled to the same rights, and subject to the same obligations, as other ACP States signatory to the convention. These agreements are now in the process of ratification by member states and copies have been laid before the Dáil in accordance with Constitutional procedure.
At the same ceremony in Luxembourg, the Community and Zimbabwe also concluded an interim agreement which extended the trade provisions of the Lomé Convention to Zimbabwe as from 1 January 1981.
Under the terms of Article 186 of the convention, the accession of Zimbabwe will require the Community to increase the amount of financial and technical aid pledged to the ACP States — currently standing at 5,227 million European currency units (ECU) or IR£3,627 million. Of this figure 4,542 million ECU is to be distributed through the Fifth European Development Fund (EDF) while the remaining 685 million ECU will take the form of loans granted through the European Investment Bank (EIB).
The 5th EDF was established by the Internal Agreement on the Financing and Administration of Community Aid which was signed in Brussels by the member states of the Community on 20 November 1979 and approved by the Dáil at the same time as the Second Lomé Convention. In addition to comprising the funds allocated for the ACP States, the fund also has 94 million ECU set aside for distribution to the overseas countries and territories of Community member states, under special arrangements along the lines of those established for the ACP States under the Lomé Convention. The total volume of the 5th EDF at present, therefore, is 4,636 million ECU of which Ireland will contribute 0.6 per cent. That is 27.8 million ECU or IR£19.3 million.
The agreement before the Dáil today is an amendment to the Internal Financial Agreement of November 1979. This amending agreement was signed in Brussels on 16 December 1980 and it is intended that it should take effect on Zimbabwe's formal accession to the Lomé Convention. The result of this latest agreement will be to increase the size of the 5th EDF by 85 million ECU, IR£59 million, to 4,721 million ECU. On the basis of our 0.6 per cent contribution Ireland will be due to provide 28.3 million ECU, IR£19.7 million. This represents a net increase in our contribution of 510,000 ECU or IR£354,000. It is expected that this additional contribution will be called up over a period of seven to eight years.
The purpose of increasing the size of the fund by 85 million ECU is to ensure that other ACP States do not receive less assistance from the fund as a result of Zimbabwe's eligibility to EDF aid. The size of the increase was determined in accordance with the criteria used to allocate the existing resources of the 5th EDF among the various ACP States—that is, population and gross national product per capita. Attention was also given to the particular opportunity for regional development programmes on a supranational basis afforded by Zimbabwe's location in the heart of southern Africa.
I said earlier that an increase in the amount of aid which the Community makes available to the ACP States was a necessary condition for Zimbabwe's accession to the Lomé Convention. This is indeed the case but there is a more positive aspect. As Zimbabwe moves into its second year as an independent nation it needs financial assistance to help it realise the vast potential of its human and physical resources. Approval of the agreement before the Dáil today will represent a pledge, on behalf of the people of Ireland, to provide over IR£350,000 towards these needs.