On 7 November 2007 a Memorandum of Understanding was signed between the European Commission and the six countries, PALOP and East Timor (which formally joined the group). The Memorandum of Understanding signed by the National Authorities of the PALOP and East Timor and the European Commissioner Louis Michel, in the presence of the President of the European Commission, José Manuel Durão Barroso, defined the areas of cooperation under the 10^th EDF, focusing on good governance.

Together with the ‘Cooperation Guidance Document’, signed in Luanda in May 2008 during the 6^th Meeting of the PALOP and Timor-Leste National Authorising Officers with the EU, a ‘Governance Initiative’ was established with a total allocation of €33.1 million.

The partners have committed themselves to pursuing and strengthening their cooperation by focusing on democratic governance as a key factor for development and the fight against poverty.

Against this background, for the programming of the 10^th EDF the PALOP and Timor-Leste committed to financing the Programme by 4% from the respective National Indicative Programmes: Angola €7m; Cape Verde €1.1m; Guinea-Bissau €3m; Mozambique €19m; São Tomé and Príncipe €0.5m; and Timor-Leste €2.5m.

It was agreed to continue cooperation in the field of democratic governance, focusing on aspects related to:

• Political governance: democracy, human rights and the rule of law;
• Government effectiveness, namely the capacity to provide public services; and
• Economic governance.