TR-EU Financial Co-operation

TÜRKİYE - EU FINANCIAL COOPERATION

The main goal of the EU financial assistance to Türkiye, is to enhance the institutional capacity, the quality of legislation, the quality of implementation of the legislation so as to make it possible to integrate easily to common policies (like social policies, development, rural policies) when she become a full member of EU.

After the full membership negotiations began in October 2005, there has been a substantial increase in TR-EU financial assistance budget.

Later on, with the 2007-2013 budget period, the mechanisms of financial assistance of EU to candidate and potential candidate countries are consolidated into a single instrument which is called Instrument for Pre-Accession Assistance (IPA).

Candidate countries and potential candidate countries are the beneficiaries of IPA mechanism. Although 4,8 Billion is allocated to Türkiye for 2007-2013, in comparison with the population, the fund allocated to Türkiye cannot be considered as sufficient but Türkiye is trying to utilize these funds with maximum effort. For 2007-2013, EU fund provided to Türkiye under IPA is €66 per capita which is €171 for Bosnia & Herzegovina and €378 for Montenegro.

The issues like the allocation of funds between candidate and potential candidate countries and the components of financial cooperation are determined solely by EU side but on the other hand, the methods of the allocation of funds between components within Türkiye, programming and implementation of the components, monitoring of the projects are determined through negotiations between Türkiye and EU by also taking the specific conditions of Türkiye into consideration.

Within the preparation process for the 2014-2020 period of the Türkiye-EU Financial Cooperation, efforts were made in order to be more pro-active in the decision making process.

In IPA-I period, main components of the financial assistance have been Transition Assistance and Institution Building, Cross Border Cooperation, Regional Development, Human Resources Development and Rural Development.

Table 1: IPA funds allocated to TR by components (Million Euro) 

IPA II PERIOD

The second period of the Instrument for Pre-Accession Assistance (IPA) covering 2014-2020 is implemented in the framework of Türkiye’s targets which are capacity development in terms of EU acquis alignment and economical and social cohesion.  

European Commission has introduced the sectoral approach in the new period for the effective utilization of funds. Within the framework of this sectoral approach, instead of the components based structure at the first period of IPA, some priority sectors to be financed and the responsible lead institutions to conduct the sectoral preparations have been identified.

Reference documents on the EU side which set the legal basis for IPA II Period:

- IPA II Regulation was published on 15 March 2014

- IPA II Implementing Regulation was published on 3 May 2014

The main document of this period indicating the financing priorities of assistance under IPA is the Indicative Strategy Paper for Türkiye (2014-2020), which was adopted by the Commission on 26 August 2014.

The Framework Agreement was signed between Our Country and the European Commission in order to carry out the financial cooperation in the IPA II period in accordance with the European Union Regulations, Following the signatures, the Framework Agreement, which transfers the implementation principles to domestic law, was published in the Official Gazette, and the entry into force date of the Agreement was determined as 22 June 2015.

The Prime Ministry Circular No. 2015/15 was published, aiming to determine the public administrations that ensure the funds provided by the European Union within the scope of the IPA are used within the framework of effective administrative and financial management principles in line with the agreements concluded with the EU, and to regulate the relations between these institutions. The Circular was updated within the scope of the new government system and the Presidential Circular No. 2019/20 entered into force by being published in the Official Gazette No. 30908 dated 4 October 2019.

The total allocation for Türkiye under IPA II for 7 years amounts to 4.453,9 MEUR, as stated in the Country Strategy Paper. The details of the allocated budget are given in the below table.

Table 2: Policy Areas and Sector Based Indicative Allocation

The priority sectors and the lead beneficiaries as identified for IPA II period:

• Democracy and Governance (Ministry for EU Affairs - Alignment with EU acquis, Union Programmes and Civil Society)
• Rule of Law and Fundamental Rights, (Ministry of Justice, Ministry of Interior and Ministry for EU Affairs)
• Environment, (Ministry of Environment and Urbanization)
• Transport, (Ministry of Transport, Maritime Affairs and Communications)
• Energy, (Ministry of Energy and Natural Resources)
• Competitiveness and Innovation (Ministry of Science, Industry and Technology)
• Employment, Human Resources Development and Social Policies, (Ministry of Labor and Social Security)
• Agriculture and Rural Development, (Ministry of Food, Agriculture and Livestock)
• Territorial Cooperation (Ministry for EU Affairs).

IPA III PERIOD

Just like previous Instrument for Pre-Accession (IPA) periods, IPA III, covering the years 2021 – 2027, will be carried out within the framework of the objectives of improving Türkiye's capacity for harmonization  and implementation of the EU acquis and building capacities for economic and social harmony. In the new period where there is no country specific allocation, a total of 14.2 billion Euros of funds were allocated for all beneficiary countries with fair share principle.

Actions in this context are grouped under thematic Windows:

(i) Rule of Law, Fundamental Rights and Democracy

(ii) Good Governance, Acquis Alignment, Strategic Communication and Good Neighbourly Relations

(iii) Green Agenda and Sustainable Connectivity

(iv) Competitiveness and Inclusive Growth

(v) Territorial and Cross-Border Cooperation

Reference documents on the EU side which set the legal basis for IPA III Period:

- IPA III Regulation No. 2021/1529 was published on 20 September 2021,

- The IPA III Implementing Regulation No. 2021/2236 was published on 16 December 2021.

The IPA III Programming Framework, which is the comprehensive European Commission strategic document on the use of IPA funds during the EU's IPA III period, and Türkiye’s Strategic Response Document, which explains the plan to use IPA III Financial Assistance to contribute to the general and specific targets defined in the IPA III Programming Framework were published at the end of the year 2021.

In order to carry out the IPA III period in accordance with the European Union Regulations, the Financial Framework Partnership Agreement, which transferred the principles regarding the implementation to domestic law, was signed on 17 October 2022 and approved by the Presidential Decree No. 6537 and published in the Official Gazette No. 32042 dated 13 December 2022. The entry into force date of the agreement is determined as 14 December 2022.

On the other hand, Presidential Circular No. 2023/11, which aims to re-organize the structure established by the Presidential Circular No. 2019/20 regarding the administration of European Union funds in Türkiye in line with the requirements of the 2021-2027 period financial assistance, was prepared and published in the Official Gazette No. 32231 dated 24 June 2023.

The structures and functions established in Türkiye in accordance with the Circular are as follows:

National IPA Coordinator (NIPAC): The Directorate for EU Affairs is responsible for the overall coordination of programming, monitoring, evaluation and reporting of implementation of IPA funds.

National Authorizing Officer (NAO): The Ministry of Treasury and Finance bears overall responsibility for the financial management of IPA funds and ensuring lagality and regularity of the transactions.

National Programming Compliance Coordinator: The Presidency of Strategy and Budget under the Turkish Presidency is responsible to ensure complience of the action/program documents within the scope of IPA III with national policies, plans, programmes and budgetary processes.

Managing Authority: Responsible for the overall management of relevant thematic priorities under the IPA thematic windows. The Managing Authority designates one or more “Intermediate Bodies for Financial Management” to carry out financial management tasks. Intermediate Bodies for Financial Management take all decisions regarding the execution of their duties independently. In addition, the Managing Authority may designate one or more “Intermediate Bodies for Policy Management” to carry out the management tasks of the thematic priority for which it is responsible.

Institutions Responsible for Sectors: Supports the Managing Authority in programming, tendering, implementation and monitoring processes within the scope of the relevant thematic priority.

Intermediate Body for Policy Management: Provides technical expertise in the programming, implementation, management and control of financial assistance in the thematic priorities to which it is assigned.

Intermediate Body for Financial Management: As the contracting authority, it carries out tendering, contract management, payment, accounting and financial reporting duties independently.

Anti-Fraud Coordination Service: The State Supervisory Council is responsible for conducting examinations, inquiries, and investigations regarding the use of the financial resources provided by the European Union, or have these functions conducted.

Audit Authority: The Board of Treasury Controllers is assigned to audit the functionality and efficiency of all management and control systems of IPA.

Programming Studies:

In terms of  2021 annual programming process, 208.5 million Euro package consisting of the priority areas of Civil Society, Environment, Energy, Transport, Education-Employment, Health, Competitiveness and Rural Development, within the framework of the above 5 thematic windows was prepared, submitted to the European Commission and ratified with Commission Decision. The Financing Agreement for the said programming year has been signed and the implementation process has been initiated.

In terms of  2022 annual programming process, 221 million Euro package consisting of the priority areas of Fundamental Rights, Good Governance, Environment, Transport, Education-Employment and Rural Development, within the framework of the above 5 thematic windows was prepared, submitted to the European Commission and ratified with Commission Decision. The Financing Agreement for the said programming year has been signed and the implementation process has been initiated.

In terms of  2023 annual programming process, similar to previous years, 244,6 million Euro package consisting of the priority areas of Fundamental Rights, Good Governance, Environment, Transport, Education-Employment and Rural Development, within the framework of the above 5 thematic windows was prepared, submitted to the European Commission and ratified with Commission Decision. It is expected that the Financing Agreement for the said programming year will be signed and the implementation process will be initiated.

In terms of  2024 annual programming process, negotiations with the European Commission is still ongoing within the framework of 5 thematic windows.

The preparation process for multi-annual programming exercises, which covers the years 2025-27, is still ongoing.

The action documents adopted by the Commission can be accessed via the link below:

https://neighbourhood-enlargement.ec.europa.eu/enlargement-policy/overview-instrument-pre-accession-assistance/turkiye-financial-assistance-under-ipa_en