The traditional objectives of Dutch foreign policy are maintaining good relations between the Netherlands and other countries, protecting the country against outside threats and promoting a just world where peace, security, welfare and human dignity are guaranteed. In 2003 the core objectives of Dutch international cooperation policies for the coming years were formulated as follows:

• an integrated policy (poverty reduction and classic foreign policy);
• a more pronounced regional approach;
• a sharper focus on Africa (especially the Great Lakes and the Horn);
• a bigger role for the private sector (companies and civil society);
• a greater degree of coherence between fields of policy.
  

Furthermore a greater emphasis is placed on the importance of institutions for development and the assessment of governance issues in partner countries (including the central issues of law, democracy and participation).

Since 1997 all expenditure related to foreign policy is organised in one budget, the so-called ‘Homogeneous Group International Cooperation’ (HGIS). This amounts to 1.1% of the Gross Domestic Product (GDP)¹. The budget for Official Development Assistance (ODA²) is part of the HGIS and is fixed at 0.8% of the GDP. The ODA budget is under the responsibility of the Minister for Development Cooperation and spent through DGIS.

The non-ODA part is 0,3%³ of the GDP, this is allocated for other foreign policy related expenses, such as support for Central and Eastern Europe, peace missions, expenditure in the context of the Clean Development Mechanism (CDM) and the Joint Implementation (JI) agreements, debt reduction issues (HIPC), export programmes, embassies, and policies for the promotion of intercultural understanding.

A central feature within this new approach is the decision to set up a so-called Stability Fund. The aim of the fund is to provide rapid and flexible support for activities that foster peace, security and development in countries and regions where violent conflicts are threatening to erupt or have already erupted. Special attention will be paid to conflict prevention and peace building, including Security Sector Reform. The fund will allow Dutch foreign policy instruments and resources to be deployed in a more coherent and integrated manner. The Stability Fund will dispose of resources from the development budget (ODA) as well as the general foreign policy budget (non-ODA). A number of existing funds will be brought under the Stability Fund, since they are of relevance to the Fund’s objectives: the anti personal mine clearance fund, the small arms fund, disarmament, resources for the demobilisation and reintegration of combatants, peace dialogues, peace building and the Peace Fund. The Peace Fund will cease to exist and will be largely transferred to the Foreign Policy Support Programme to finance activities that do not fall under the Stability Fund. Combining resources in this way will improve the effectiveness of Dutch foreign policy in the above-mentioned areas. Moreover, the fund will be integrated with other foreign policy instruments.

Some of these activities can be implemented in collaboration with European or other partners, as is now partially the case with the Peace Fund. Certain types of financial support can occur through multilateral channels. The fund will also draw on the knowledge and expertise gained by partners and civil society organisations active in the region concerned.

The Stability Fund will not finance the deployment of Dutch military troops in peace missions nor will the fund deal with good governance and other related policy fields. Thus the creation of the Stability Fund will not result in contamination of development cooperation. If certain activities do not meet the OECD/DAC requirements for Official Development Assistance (ODA), they will not be attributed to ODA. The financing will come from money that was reserved for Dutch foreign policy activities promoting stability and from additional resources.

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