Eu Structural Funding As Part Of Eu Regional PolicyEssay Preview: Eu Structural Funding As Part Of Eu Regional PolicyReport this essayThe main goal of European Union regional politics is reduction of the economical and social inequalities between the richest and poorest regions. These disproportions are often caused by peripheral geographical position, difficult weather conditions, insufficient infrastructure, disadvantageous structure of economy (with agriculture dominating), low level of qualification among the population etc. The differences in standard of living and economical growth is a barrier for EU integration. (
The problem was named by Western Europe in 30ties of the last century. In post-war period regional politics was limited to redistribution of the financial resources to poorer and underdeveloped regions mainly by supporting infrastructural investments in those areas. These actions were not deemed to be sufficient and resulted in appealing to planning instruments and gradual regionalisation of the state. European Union member states (EEC then) decided to incorporate regional policy into the European Community programme. (
Treaty of Rome (1957) among three directions of activity also includes “increasing resources by valorisation of the underdeveloped regions and by using unemployed workforce.” (I. Pietrzyk, Warsaw 2002). The report also emphasized the importance of coordinating regional plans of the member states. Likewise it suggested founding of the special investment fund serving a purpose of creating an environment for balanced growth. Unfortunately all those statements were not reflected in practice. Besides the above Treaty of Rome mentioned the reduction of the disproportions and underdevelopment of regions, but in the budget framework was lacking the regional policy (I.Pietrzyk, Warsaw 2002)
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the above list was never taken into account when making a recommendation. Indeed the NHLA did not consider the NIP issues properly with respect to the national fiscal policy, but rather the national economic policy of the Member States. We can look forward and believe that this NIP will lead to a healthy growth rate. The National Growth Goal, adopted by the Member States in December 2007 and subsequently followed by several regional plans has a central point of reference which is:
1. To prepare for the future development of the euro area for the development of economic development and to foster economic integration.2. To have effective and practical management and to ensure the economic, social, civic, cultural and social justice of the new economic order. It has the potential for building the capacity of a more free and cooperative Europe to enhance productivity, mobility, prosperity and the common heritage of a whole world.
3. To help to make the euro area more capable of maintaining good quality of life and promoting national self-determination. It is the only objective for the European Council to ensure and enable development and further economic development of the euro Area under any conditions (Towards a Single market and Economic Union under any conditions, I.Pietrzyk, Warsaw 2002, p. 453).
4. To enable the Member States to work together harmoniously within the common market system and to protect the sovereignty and independence of the single market. It is a principle to work towards a fair and inclusive Euro-economic Union and to continue promoting the benefits that EU institutions as a whole enjoy of economic security and competitiveness (Towards the European Economic Community under any conditions). The European Commission and the European Central Bank have been conducting research on national growth and development for the past 15 years. We aim to take a more complete examination of the specific measures taken in relation to national growth, its interconnections and competitiveness to ensure that the Member States can achieve their development objectives. We shall also strive to enhance transparency and accountability concerning the actions taken at the European Council.
5. To establish a level playing field and to make European policies, initiatives and policies more international as well as more specific and effective in accordance with our vision of the European region and Member States. We shall keep in mind the criteria as to this: a) the scope and priority of the activity, including activities on the internal level to promote the international coherence and coordination of the euro area-wide development agenda. b) a level playing field has to involve the common interests of everyone involved in the economic process to maximize the growth in economic performance of the euro area and promote the development
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the above list was never taken into account when making a recommendation. Indeed the NHLA did not consider the NIP issues properly with respect to the national fiscal policy, but rather the national economic policy of the Member States. We can look forward and believe that this NIP will lead to a healthy growth rate. The National Growth Goal, adopted by the Member States in December 2007 and subsequently followed by several regional plans has a central point of reference which is:
1. To prepare for the future development of the euro area for the development of economic development and to foster economic integration.2. To have effective and practical management and to ensure the economic, social, civic, cultural and social justice of the new economic order. It has the potential for building the capacity of a more free and cooperative Europe to enhance productivity, mobility, prosperity and the common heritage of a whole world.
3. To help to make the euro area more capable of maintaining good quality of life and promoting national self-determination. It is the only objective for the European Council to ensure and enable development and further economic development of the euro Area under any conditions (Towards a Single market and Economic Union under any conditions, I.Pietrzyk, Warsaw 2002, p. 453).
4. To enable the Member States to work together harmoniously within the common market system and to protect the sovereignty and independence of the single market. It is a principle to work towards a fair and inclusive Euro-economic Union and to continue promoting the benefits that EU institutions as a whole enjoy of economic security and competitiveness (Towards the European Economic Community under any conditions). The European Commission and the European Central Bank have been conducting research on national growth and development for the past 15 years. We aim to take a more complete examination of the specific measures taken in relation to national growth, its interconnections and competitiveness to ensure that the Member States can achieve their development objectives. We shall also strive to enhance transparency and accountability concerning the actions taken at the European Council.
5. To establish a level playing field and to make European policies, initiatives and policies more international as well as more specific and effective in accordance with our vision of the European region and Member States. We shall keep in mind the criteria as to this: a) the scope and priority of the activity, including activities on the internal level to promote the international coherence and coordination of the euro area-wide development agenda. b) a level playing field has to involve the common interests of everyone involved in the economic process to maximize the growth in economic performance of the euro area and promote the development
The only common institution oriented for the regional development and raised by Treaty of Rome was European Investment Bank (EIB, 1958r). which for almost 20 years was the only common source of regional investments finance.
The first breakthrough in the development of the regional policy was founding of Regional Policy Directorate General in the structure of the European Commission, which was responsible for conception and practical implementation of regional politicy.
Only the founding of European Regional Development Fund (ERDF) in 1975 stimulated European regional politics. It was ERDF that became the main financial instrument of that politics. It suppose to level economical and social differences of the among the European Community members. ERDF resources were assigned to member states in national quotas system and were only used to reinforce the regional policy activities of the member states. The ERDF rules were changed in 1984 when the the system of national quotas were replaced with a new financial distribution mechanism
based on indicative ranges of support determined for each country which guaranteed only the low boundary of the participation (i.e. 88,63%) to particular states. This introduced the rule of programming regional development, which meant withdrawing of the individual project financing in favour of programmes initiated by European Community or national programmes which are significant to the whole European Community (www.ukie.gov.pl).
Single European Act established in 1986 laid the ground of the new structural politics of the European Community but first of all – regional politics. Treaty of Rome was extended with a new part entitled “Economic and Social Cohesion ” (Arts. 130a-e) which stated that the ultimate goal of the Community is to level the differences between the richest and the poorest regions and establishing the foundation of the common structural politics. The framework described 6 set of goal categories:
1)supporting the development and structural readjustment of underdeveloped regions,2)restructuring of the border and industrially declined regions,3)fighting long-term unemployment and allowing young people and endangered by long-term unemployment to enter the professional career,4)enabling the employees adoption to the industry changes,5)undertaking the reform of the common agricultural politics (two additional goals were named: 5a – hastening the modernisation and adjustment in the Unions agricultural structure; 5b – help in development and structural changes of rural regions),
6)facilitating the regional development of the Scandinavian countries (this goal was established after Finland and Sweden joined the EU).Further consequence was the reform of structural funds prepared in 1988. Later on also the funds budget was increased from 7.2 milliard ECU in 1987 to 14.5 milliard ECU in 1993.
Regional politics was reinforced in 1993 after signing Treaty on European Union in 1992, when so called Cohesion Funds was founded with a budget of 15.15 milliard ECU for seven year period (1993-1999). It was meant as a financial backup for EU countries which Gross Domestic Product is not higher than 90% of an average of all the member states (Greece, Portugal, Spain and Ireland) (www.fundusze.ukie.gov.pl). Main purpose of the fund was to put technical infrastructure and environment investments into motion – especially transeuropean structural networks. ( J. Hausner, M. Maroda, Krakow, 2000 )
The funds for the structural spending quickly increased. The EU summit meeting in Edinburgh (1992 ) raised them to 141,47 milliard ECU for 1994-1999 period. European Investment Bank allocated 90 milliard ECU for structural activities loans. It is also worth mentioning another 15.5 milliard of ECU from Cohesion Fund.
Next European Union summit, which took place in 1999 in Berlin was devoted to general rules of the structural politics for the following years (Agenda 2000). One of the important task was improving the utilisation of the structural funds and Cohesion Fund. The most important goals were deemed to be (decrease from six to three according to rules from 1988):
Objective 1 – supporting development and structural adaptation of underdeveloped regions (GDP per capita below75% of the EU average) and sparsely populated north regions of the Scandinavia with difficult climate conditions (with less than 8p/sq. km.). Additional help may be given to regions endangered with serious unemployment.
For this target in years 2000-2006 EU assigned 70% of the structural funds i.e.135.9 milliard Euro.Objective 2 – supporting economical and social conversion of regions with structural difficulties. Commission proposes help for every region that suffers from the strong need of social and economical restructuring. It was mainly