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close this bookThe Courier N 130 Nov - Dec 1991 - Dossier: Oil - Reports: Kenya - The Comoros (EC Courier, 1991, 96 p.)
close this folderCountry reports
close this folderThe Comoros - In dire economic straits
View the document(introduction...)
View the documentAn interview with President Said Mohamed Djohar
View the documentAn interview with former Production and Industry Minister, Ali Mroudjae
View the documentComoros-EEC cooperation
View the documentExternal aid to The Comoros

Comoros-EEC cooperation

by Benoit AUBENAS

The Federal Islamic Republic of The Comoros celebrated its 15th anniversary of independence on 6 July this year, but cooperation with the Community goes further back than that, to the early days of the European unification process-in 1958. Between then and 25 July 1991, when the LomV indicative programme was signed, the Community has allocated more than ECU 73 million in programme aid, plus ECU 3.2 million risk capital from the European Investment Bank, ECU 18 million from Stabex, ECU 16 million-worth of food aid and ECU 3.5 million assistance for structural adjustment - a total of more than ECU 118 million.

These figures reveal that Community aid is, one, constant, two, provided through a number of different instruments and, three, intended to cater for the economic difficulties of an island country which is one of the least developed nations and has the world crisis to contend with.

This is summarised in the tables.

Community aid is constant

In 1958, in the early days of the construction of Europe, the Community helped the then Overseas Territory with a development programme - active involvement which was to continue and expand in the years which followed.

Under the first three EDFs (1958-75), assistance was given with basic infrastructure and social facilities (ports, roads, education and health), but, in 1975, Community aid began to take the form of programmes and this took off in a big way, with ECU 18 million in 1977-80, ECU 29 million in 1980-85 and ECU 35 million from 1985.

In the vagaries of the international economic situation, the EEC has maintained and even stepped up its aid to The Comoros, which despite very few donors, has a constantly active partner in Community assistance.

Table 1: Summary of aid, 1st-3rd EDFs, 1958-1975 (Mayotte included)

Table 2: Summary of aid, Lom, 4th EDF

Community aid is varied

The Comoros is in a difficult economic situation. It is particularly sensitive to changes in the international economy and, having a volcano and being prey to hurricanes, is the victim of weather too.

Table 3: Aid programme LomI, 5th EDF

It has taken considerable advantage of the various means of assistance provided by the Lomonvention.

Table 4: EEC - Comoros cooperation LomII

Table 5: Community programme aid under LomV (7th EDF)

Programme aid has been provided under the successive EDFs for:

- agricultural programmes:

· maize and other food crops to counter the consumption of imported rice;
· small livestock (poultry for the table to replace imported birds);
· artisanal fishing, with a view to making more of the coastal area;
· integrated project to develop part of Anjouan Island;

- infrastructure programmes:

· roads;
· Port of Moroni;
· power supplies and telecommunications;

- social programmes:

· water supplies for Moroni; Mutsamudu and Fomboni.

Stabex payments have been made over and above this to compensate for earnings lost on vanilla, cloves and essential oils. Food aid (rice, milk powder, sugar and vegetable oil) has gone some way to making up the food shortfall which is inevitable in a country where the farmers cannot hope to feed the constantly expanding (3.4% p.a.) population and emergency aid has provided immediate help for the victims of hurricanes and volcanic eruption.

In addition to the grants The Comoros gets from the Community, it derives benefit from the risk capital managed by the European Investment Bank, which provided an ECU 2 million line of credit to The Comoros Development Bank for the period of LomII (1985-90). In 1991, all loans were committed to the building and building materials sector and to food and agriculture.

ECU 3 million has also been provided for The Comoros Development Bank for 1990-95, this time for one-off schemes in such sectors as telecommunications as well.

Lastly, The Comoros belongs to various international organisations (the IOC, CICIBA etc) and therefore gets the benefit of projects which reduces its isolation and involve it more in international life. Ongoing discussions of financing to modernise the telecommunications network is also primed at helping in this respect.

This, then, is a country which will have made the most of the instruments of cooperation which the Lomonvention offers - and, of course, made its aid management more complex in the process.

Adapting Community aid

The Comoros has been discussing the rationalisation and modernisation of its economy with the Washington institutions for several years and President Dhojar made his priority signing a structural adjustment agreement with these bodies when he took office in March 1990. The procedure began in April 1990 and ended in mid-June 1991 with a favourable decision by the Boards of the World Bank and International Monetary Fund.

The structural adjustment programme should help with the (internal and external) public debt and the vital rationalisation of public finances.

The LomV indicative programme contains special arrangements for which The Comoros is eligible and ECU 3.5 million is to be allocated for the country to import essentials such as petrol, cement and fertiliser. The counterpart funds accruing from the sales of these goods could be used to cushion the negative effects of measures taken under the structural adjustment programme. Cooperation can provide an answer to problems of debt and State reform and the flexible nature of Community aid is very much appreciated by the Government.

In late 1989, the Commission of the European Communities decided to upgrade its representation in The Comoros to the status of Delegation, so it no longer depended on the Delegation in Mauritius - a response to the country’s oft-stated desire and to the extreme diversity of Community cooperation in the islands. In LomThe Comoros has the instruments it needs to help its development along and the recent signing of agreements with the Bretton Woods institutions will enable it both to boost this cooperation with the EEC and harmonise it better with aid received from other funders. This is an essential aspect of international cooperation and one which this country, with so few resources of its own, is making efficient use of in the field. B.A.