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With discussions on the next Multiannual Financial Framework (MFF) under way and a Commission Communication to kick off formal negotiations due by early summer 2018, there is currently an opportunity to influence choices before the terms are officially set. Three fundamental questions need to be answered:

1. How much funding should go toward EU external action, which today falls mainly under Heading 4 (Global Europe) of the current MFF?
2. What should this money be spent on?
3. How should this money be managed through what type of instruments, with what regulations,and by whom?

This paper addresses these interrelated questions. It begins by analysing the external and internal context and priorities for the EU from a development lens; examines why the current MFF is not fit to respond to this context; and presents a series of recommendations for a well-resourced and redesigned Heading 4, with a focus on development. These recommendations address the size and architecture of Heading 4, and propose reforms to the ways in which EU development cooperation is managed.