The future of European aid is being hotly debated. This paper presents the results of a major evaluation of EUEuropean Union aid to Ethiopia over the period from 1976 to 1994. It concludes that the effectiveness of aid has varied. Some, perhaps most, 'worked', but some did not - for reasons partly internal to Ethiopia and partly internal to the EU. A seven-point action plan is proposed to enable the EUEuropean Union to achieve an objective-driven strategy.