The European Union has launched a new platform that will provide a series of recommendations and guidelines for the use of blending formulas in the field of external cooperation. This initiative aims to increase the impact of European external aid by mobilizing additional public and private resources.

This new tool launched by the European Commission represents an important step in the improvement of the effectiveness of the assistance provided by the EU through blending mechanisms. “Blending” is financial tool which combines EU funding with other public ans private sector resources such as loans and equity in order to leverage additional funding resources not coming from grants.

The new European platform will serve as a forum to build on positive experiences that have already been carried out in this field and to analyse how it is possible to exploit the potential of blending formulas, taking into account the policy framework of the European Union in relation to its different partner countries. These policies include actions taken in areas such as development policy or the neighbourhood and enlargement EU policies.

The use of this kind of financial schemes as well as other innovative financial instruments are an exceptional means to make strategic use of the funds available within the European Union. The work plan agreed for 2013 provides for a review of the existing blending mechanisms and the development of a common framework to analyse the resulting impacts. Ion order to maximize the results of these mechanisms, a series of working groups have been put in place which count with the involvement of the Commission, the European Investment Bank, other European bilateral and multilateral institutions and other financial institutions involved in blending funding.

Since 2007 the European Commission has set up eight regional blending regional funding mechanisms with Member States. Up to €1.5 billion from the EU budget, the European Development Fund and Member States have funded over 320 actions through blending finance. More recently, the Agenda for Change put forward by the European Commission in 2011 to define the way of refocus its work on external development in order to be more effective, also established the Commission's plans related to blending.