European Union Policy and Action Toward Central Asia and the Caspian Sea Countries René Leray The EU policy toward the Newly Independent States(NIS) is mainly articulated around four complementary pillars: • EU partnership and cooperation agreements(PCA) with each of the Newly Independent States(NIS): These are comprehensive frameworks covering economic issues and political dialogue and democratic institution building. • EU TACIS programs(technical assistance programs), which constitute the world’s largest donor grant finance to the New Independent States. These first two pillars cover the whole spectrum of the necessary economic and political modernization of these countries • The European Energy Charter and its Treaty, which is legally binding and which will enter into force in November 1998. • INOGATE(Interstate Oil and Gas Transport to Europe), a specific technical assistance program. Both the Energy Charter and the INOGATE program are designed to create opportunities for these countries to exploit and export energy resources as a concrete basis for their economic development and their political independence. Since 1991 TACIS allocated more than 2.3 billion ECU for grants to the NIS of which a significant share went to the Caucasus and Central Asia countries. Energy – not including nuclear safety – represented more than 300 million ECU, the other important sectors of assistance being the reform of the public administration, the restructuring of state enterprise and private sector development, the modernization of agriculture as well as transport and telecommunication infrastructures. The Energy Charter is a multilateral framework initiated by the European Community as early as February 1991 which settles a full set of guidelines and principles for investment 58