EU budget support is a means to deliver effective assistance, including in situations of crises. It is again demonstrated by the central part that it plays in the support provided to Ukraine and neighbouring countries confronted with the Russian war of aggression. Previously it had been instrumental in tackling the negative impact of the COVID-19 pandemic in partner countries.

In all contexts, budget support contributes to strengthening country systems and budget processes, thereby fostering EU partners’ capacities to implement their policies, including for crisis response, and deliver on reforms and on results for their people. It helps foster progress towards the sustainable development goals (SDGs) even under adverse global circumstances.

Budget support offers a platform for policy dialoguewith authorities and promotes accountability for the use of public funds, while putting forward EU priorities. It constitutes a key modality for the Global Gateway alongside technical assistance and the European Fund for Sustainable Development (EFSD+), supporting fundamental values, a human-centric approach to investment and progress in economic governance. EU budget support is an asset for Team Europe.

In 2022, EU budget support continued to cover a large variety of sectors (basically all SDGs) and geographies (88 countries and overseas territories). In the past 3 years, EU budget support has helped countries by providing payments of EUR 6 billion overall – EUR 3 billion in 2020, EUR 1.2 billion in 2021 and EUR 1.8 billion in 2022.

This report depicts the EU budget support’s contribution to dialogue with partner countries, to fiscal needs and to policy results in different regions and countries, including to advance public administration reform. The report has three parts.

Part I presents the results achieved by partner countries in a selection of 33 examples highlighting the EU budget support’s contribution to their policies and to Global Gateway objectives. Some country cases still relate to the socioeconomic response to the pandemic, and others illustrate how the EU assisted countries in coping with the consequences of the Russian war of aggression against Ukraine.

Part II analyses the risks and mitigation measures associated with budget support. The protracted effects of the COVID-19 pandemic combined with the impact of the Russian war of aggression against Ukraine strongly influenced the breadth and depth of risks.

Part III describes the financial and geographical distribution. In 2022, the European neighbourhood became the largest recipient of budget support (38 %), followed by sub-Saharan Africa (24 %), Asia (18 %), the western Balkans (8 %), Latin America (6 %), the Caribbean (2 %), overseas countries/territories (2 %) and the Pacific region (2 %). By contract type, sector reform performance contracts (SRPCs) outweigh state- and resilience-building contracts (SRBCs) and SDG contracts (SDG-Cs), with 74 % of the portfolio in value compared to 24.5 % and 1.5 % respectively.