EU Regional Policy
EU Regional Policy

EU Regional Policy

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  • Pages: 5 (2501 words)
  • Published: November 16, 2018
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Introduction

The EU regional policy is a critical instrument of financial solidarity and an extremely powerful force for economic cohesion and integrity. Through establishment of solidarity, tangible benefits are brought to citizens in regions that are not well-off. Cohesion underlies the crucial principle that everyone in the EU community should benefit from narrowing of income and wealth gaps between various regions.

Large differences in levels of prosperity exist both within and between EU countries. In terms of GDP per capita, the most prosperous regions are all urban – Brussels, London and Hamburg. Luxembourg, the wealthiest country, is seven times richer than Bulgaria and Roman, the newest and poorest EU members.

Membership to the EU comes with many dynamic and beneficial effects, especially when it is coupled with a properly planned and executed regional policy. For example, Ireland’s GDP was only 64% that of the EU average when it joined the EU in 1973. Today, the country has one of the highest GDP (the standard measure of well-being) in the EU. One of the key priorities of regional policy is to improve the living standards in all the countries which have joined the union since 2004 in order for them to attain the EU average within the shortest possible time.

The regional inequalities that exist in the EU are as a result of long-standing economic, social and cultural handicaps. These disadvantages are as a result of social deprivation, inadequate infrastructures and high level of joblessness. In some EU member states, the handicap is partly a legacy of their previously centrally-planned economic systems.

The EU regional

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policy mainly involves investing in people. The EU has been using the entry of new countries as an opportunity to reorganize and restructure systems of regional spending. Between 2007 and 2013, 36% of the EU budget goes into regional spending. In terms of cash, this represents an expenditure of 350 billion Euros. This effort is always focused on three main objectives: competitiveness, convergence and cooperation, which constitute what is now referred to as Cohesion Policy.

The aims of the EU regional policy

The EU, being much more than a common market, is based on policies and values that are agreed upon by its member states for its people’s benefit (Schout & Jordan 2007, 841). Attaining regional equity in distribution of income and wealth is one of the fundamental objectives laid down in the European Commission Treaty. This objective is being pursued through the achievement of economic and social cohesion, a measure that has been responsible for reduction of disparities between regions.

Forty three percent of EU’s economic output is generated in only 14% of its regions: Hamburg, London, Munich, Paris and Milan. These territories are home to about a third of the union’s population. The money that is set aside for the regional policy is always channeled through three the cohesion policy’s instruments: the Cohesion Fund, European Regional Development Fund, and the European Social Fund.

The EU cohesion policy’s added value is considerable. The cohesion policy is responsible for supporting the much-needed investments in human resources, infrastructure, human resources, diversification and modernization of regional economies. It als

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contributes to more jobs and growth in poor member states and regions. These states end up achieving above-average economic growth and employment performance. They also end up being better equipped in order to catch up faster with the average EU GDP level. It would be difficult for such a level to be achieved without the investments that are being pumped into the regional policy.

The Cohesion policy also facilitates the task of ‘levering in’ and safeguarding compliance with other policies of the EU- environment, state aid, the information society and support for innovation. Moreover, it improves and modernizes all public administrations while enhancing transparency. This fosters good governance within all member states and regions. In the past, the policy has been crucial for purposes of aiding poorer member states to develop beyond the EU’s average. In the years to come, the regional policy appears poised to continue generating more success stories from the economic development trends of new members of the union.

The regional policy is also an effective tool of turning emerging challenges into opportunities (Prange 2008, p. 46). The challenges of globalization, population ageing and climate change do not stop at institutional, national, and policy borders. Instead, they have direct impact on local and regional communities directly and to varying degrees. It is difficult for Europe’s competitiveness to be achieved through the policies of individual states and regions alone. Economic success is a crucial social process for which the element of close cooperation is necessary. The European Union’s regional policy is designed in a manner that ensures that people are involved in the process of designing and implementing various regional development strategies. This ensures that only viable local projects that are of significance to the region are funded the cohesion policy’s money for the benefit of Europe as a whole.

The priority focus for the regional policy is on East and Central European members plus all other regions of all the other EU states with special needs. Fifty one percent of the Union&rsquos regional spending between 2007 and 2013 will be shared among the 12 member states that have joined the EU since 2004. The fact that this represents only a quarter of the total EU’s population underscores the commitment by the policy’s implementers to ensure that the gap between the rich and poor EU member states is bridged.

The bulk of regional spending is always reserved for regions whose GDP is below 75% of the EU’s average (Orbie 2008, p. 87). This is aimed at helping improve their infrastructures as well as develop their human and economic potential. This category of funding concerns 17 out of the 27 EU member countries. Meanwhile, all the 27 countries qualify for funding in support of innovation and research, job training, and sustainable development. Each of the 27 countries points out its less developed areas and directs the funds here. A small amount of the regional policy fund is used in inter-regional and cross-border cooperation projects.

Creation of growth and jobs

There are many ways in which the EU regional policy promotes growth and jobs. One of these ways is through

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