1 Investing in Investing in Europe’s future Europe’s future The fifth Cohesion Report The fifth Cohesion Report presented by Lewis Dijkstra presented by Lewis Dijkstra And Elisa Roller
Mar 27, 2015
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Investing in Investing in
Europe’s futureEurope’s futureThe fifth Cohesion ReportThe fifth Cohesion Report
presented by Lewis Dijkstrapresented by Lewis Dijkstra
And Elisa Roller
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Main Points
1. Situation and trends in EU regions1. Competitiveness2. Well-being and social inclusion3. Environmental Sustainability
2. Impact of national policies3. Impact of other EU policies4. Impact of Cohesion Policy5. Conclusions: Options for the future
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Promoting competitiveness Promoting competitiveness
and convergenceand convergence
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Regional disparities in the world
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Large economic disparities remain…
• Regional disparities are smaller in the US, but bigger in NAFTA
• Brazil, Russia, India and China have bigger disparities
• Reducing disparities requires investing in– infrastructure– innovation– institutions
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
…but convergence is taking place
Real GDP per capita growth, 2000 - 2011
-6
-4
-2
0
2
4
6
8
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Ann
ual c
hang
e in
%
Less developed MS
Moderately developed MS
Highly developed MS
Forecast
Less developed countries are growing faster and are likely to recover faster from the crisis
Less developed regions in the EU are growing faster, reducing regional economic disparities
Real GDP per capita growth, 2000-2011
-6
-4
-2
0
2
4
6
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
An
nu
al a
vera
ge
%
Convergence
RCE
Transition
Forecast
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Areas by degree of urbanisation
• Densely populated– Min 50 000 inhab.– Contiguous LAU2 with
500 inhab. per sq km
• Intermediate– Min 50 000 inhab.– Contiguous LAU2 with
100 inhab. per sq km
• Thinly populated– Not intermediate or
densely populated
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
IT Infrastructure: Broadband Access
Infrastructure
Household without broadband, 2009
0
10
20
30
40
50
60
70
80
90
100
% o
f h
ou
seh
old
s n
ot
hav
ing
acc
ess
to b
road
ban
d
densely populated intermediate populated thinly populated
SE ITGRSKPTCYESCZLTLVPLHUFRIESIATEEBEMTDEUKLUDKFINL ROBGEU27
Bubble size is population without broadband in the area as a share of total population without broadband
Countries ranked by share of population without access to broadband
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Increasing broadband use
Infrastructure
Increase in broadband connections for households 2005-2009
0
10
20
30
40
50
60
70
Inc
rea
se
in h
ou
se
ho
lds
wit
h a
bro
ad
ba
nd
co
nn
ec
tio
n a
s %
of
tota
l p
op
ula
tio
n
densely populated intermediate populated thinly populated
BG
Bubble size is the additional households with broadband in the area, as % of total additional households with broadband
Countries ranked by increase in households with broadband connections as % ot total populationDensely populated France and Romania 2006/2009, Bulgaria 2007/2009; Intermediate populated Estonia, France and Romania 2007-2009, Slovenia 2005-2009Thinly populated France 2005-2009
PTITFRSKBERO PLDKEEELESNL ATUKSELV DEMTLT SICYHU LUCZ FIIEEU-
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Territorial cohesion reinforces:1. Access to services
• Broadband, health, education, banking…
2. Environmental sustainability• Climate change, renewable energy,
environmental protection
3. Functional geographies• Metropolitan, remote rural regions…
4. Territorial Analysis• At NUTS 3, LAU2 and grid level (ESPON,
Urban Audit, Urban Atlas …)
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Road network is incomplete• Dense network in EU-
15 little need for additional capacity. Focus should be demand side
• In Poland, Romania and Bulgaria, network is almost entirely missing.
• Investment in core network important in the East
Infrastructure
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Rail network and daily trains
• Intense use in the UK, Italy, Germany and the Netherlands
• Less frequent trains in most central and eastern countries
• Ireland, Sweden, Finland and Spain have many low frequency lines
Infrastructure
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
More tertiary educated and less early school leavers boosts innovation
Innovation
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Innovation potential & performance• Generators should
promote global cutting edge research
• Weak diffusers should invest in access to knowledge and technology
• Weak absorbers need to improve secondary and tertiary educations (both quality and quantity)
Innovation
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
E-government services
Institutions
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Competitive European RegionsThe focus should be
• In less developed regions:– Institutions– Quality of basic education– Basic infrastructure and – Health
• In highly developed regions:– Business sophistication– Technology and innovation
• In all regions– Higher education & training– Labour market efficiency– Equal opportunities – Access to markets
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
More competitiveness can increases employment and GDP
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Improving well-being and Improving well-being and
reducing exclusionreducing exclusion
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
People’s Well-being
Objective measures• Life expectancy• Mortality rates• Poverty• Crime• Income• Un-/employment• Education• Gender balance• Working hours
Subjective measures• Health perception• Access to services• Material deprivation• Safety and trust• Life satisfaction• Happiness• Capabilities• Equal opportunities• Work life balance
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Life expectancy lower in the East• Lifestyle, income and
diet• Infant mortality• Road fatalities• Cancer and heart
diseases• Access to health care• Quality of health care
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Life expectancy lower in the East
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Preventable mortality
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Mortality rates high less developed MS and regions
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Unemployment dropped in most regions until the crisis hit
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Equal opportunities: good news
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
… and some bad news
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Born outside the EU/US
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Lower employment rates for born outside EU
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Population change
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
East and West: opposite trends
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Rural regions: different trends
2001-2007Predominantly
UrbanIntermediate
Predominanlty Rural
Total
average annual change in ‰Total population change 0.4 -1.1 -3.3 -2.5Natural population change -1.8 -1.2 -1.8 -1.6Net migration 2.2 0.1 -1.6 -0.9
Total population change 5.9 5.6 3.6 5.3Natural population change 2.1 0.5 -0.5 1.0Net migration 3.8 5.1 4.2 4.2
EU-15
Population change, natural change and migration according to the urban-rural typology, 2001-2007
EU-12
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Primary health careDifficult access to primary health care by degree of urbanisation, 2007
0
5
10
15
20
25
30
35
40
45
50
po
pu
lati
on
wit
h d
iffi
cult
y ac
cess
ing
pri
mar
y h
ealt
has
% o
f to
tal p
op
ula
tio
n
densely populated intermediate populated thinly populated
FR ROMTLTSKPLPTBGEEELSIDKCZATESCYIEFIHUSEBELUNLUK LVITDEEU27
Bubble size is population with difficulty by area, as % of total population with difficulty Source: EU SILC
Countries ranked by share of population with difficult access
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Poverty and deprivation have a strong regional dimension
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Deprivation is mostly urbanSevere material Deprivation by degree of urbanisation, 2008
0
5
10
15
20
25
30
35
40
45
po
pu
lati
on
lack
ing
at
leas
t fo
ur
item
s in
th
e 'e
con
om
ic s
trai
n a
nd
du
rab
les'
d
imen
sio
nas
% o
f to
tal p
op
ula
tio
n
densely populated intermediate populated thinly populated
LU LVPL HUCY SK LTPTFR CZEE ITSIMT BEFI DEUK IE AT ELESDKSE NL BG ROEU27
Bubble size is population with severe material deprivation by area, as % of total population with severe material deprivation Source: EU SILC
Countries ranked by share of population with severe material deprivation
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
At-risk-of-poverty is mixedPopulation at-risk-of-poverty by degree of urbanisation, 2008
0
5
10
15
20
25
30
35
40
po
pu
lati
on
wit
h a
n in
com
e af
ter
taxe
s an
d t
ran
sfer
s b
elo
w 6
0% o
f th
e n
atio
nal
med
ian
eq
uiv
alis
ed
ho
use
ho
ld in
com
e as
% o
f to
tal p
op
ula
tio
n
densely populated intermediate populated thinly populated
CZ LVELITESEELTUKPTIEPLCYDEBEMTLUFRFIHUATDKSISESKNL ROBGEU27
Bubble size is population at-risk-of-poverty by area, as % of total population at-risk-of-poverty Source: EU SILC
Countries ranked by share of population at-risk-of-poverty
•
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Crime, violence and vandalismCrime, violence or vandalism by degree of urbanisation, 2008
0
5
10
15
20
25
30
35
40
po
pu
lati
on
wit
h p
rob
lem
s o
f cr
ime,
vio
len
ce o
r va
nd
alis
m a
s %
of
tota
l po
pu
lati
on
densely populated intermediate populated thinly populated
LT BGEEDKBEESFRNLITCZROHUFIDESEIEELPTATLUCYMTSKSIPL LVUKEU27
Bubble size is population with problems by area, as % of total population with problems Source: EU SILC
Countries ranked by share of population having problems with crime, violence or vandalism
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Environmental SustainabilityEnvironmental Sustainability
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Climate change adaptation
• More extreme weather events: storms, heat waves, heavy rains…
• More frequent floods
• More droughts
• Hotter summers leading to a less attractive tourism summer climate in the south
• Less snow in the mountains effecting water supply and winter tourism
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Renewable energy potential
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
… and Member States’ commitments
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
GHG EmissionsKyoto Protocol - Commitments and achievements, 2008
AT
IE
PT
NLBE
FI
DE
FR
CZ PL SKHU
BG ROLT EE
EU-15
LV
SEUK
EL
ITSI
DK
LU
ES
-60
-40
-20
0
20
40
60
Cha
nge
in G
HG
em
issi
ons
(in C
O2
equi
vale
nts)
, in
%
-60
-40
-20
0
20
40
60
dis
tan
ce to
the
targ
et i
n p
erc
en
tag
e p
oin
ts
% change relative to baseline year as agreed in Kyoto Protocol
% change - Baseline year to 2008
distance to Kyoto target (right axis)
Domestic emmission in 2008 below Kyoto target
Domestic emissions in 2008 above Kyoto target
Source: EEA, EUROSTATNote: A pos itive va lue for the dis tance to the target indicates a country for which emiss ions in 2008 were higher than the Kyoto target. This measurement does not take into account use of the Kyoto Mechanism or carbon s inks .
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Air quality low in several cities
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Environmental quality
• EU directive on waste water treatment still requires considerable investments in some Eastern MS
• Also in some regions in the EU-15 and the outermost regions compliance has not yet been achieved
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Chapter 2: Chapter 2:
National Policies and National Policies and
CohesionCohesionPublic investments and Public investments and
structural reformsstructural reforms
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Role of national governments
• EU plays a supporting role in promoting social, economic and environmental development
• National governments decide on:– Regional distribution of public investments– Investments in education and health care– Social welfare and income redistribution– Scope and speed of structural reforms– Macro-economic stability
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Public investment important source of convergence
• Many less developed regions have lower levels of physical infrastructure and need more public investment
• Public investment is higher in cohesion countries relative to GDP
• Public investments are important for growth
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Public investment and cohesion
Public investment targets:
Member State
Lagging regions Germany and France
non-lagging regions despite large internal disparities
Italy, Spain, Portugal
Peripheral or specific geographic regions
Sweden, Austria and UK
Capital region
Most central and eastern MS. Ex. Czech Republic, Slovakia and Hungary
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Structural Reforms
• Structural reforms in the areas of labour market, innovation, the business environment, competition and better regulation have been slow and uneven
• A better and faster implementation of structural reforms could enhance the growth in less developed regions and strengthen the impact of cohesion policy
• A continuing need for public investment, which should not be reduced due to fiscal consolidation
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Chapter 3:Chapter 3:
Other EU Policies and Other EU Policies and
CohesionCohesionImplicit and explicit territorial Implicit and explicit territorial dimensions and dimensions and
territorial impactsterritorial impacts
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Implicit territorial dimension
• Spatially blind policies, like the Framework Programme have a strong territorial dimension
• They tend to favour highly innovative regions and capital regions
• Less developed regions are less successful in obtaining FP funding
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Explicit territorial dimension
• Some EU policies target specific areas or change their approach according to the type of area– Several EU directives focus on urban areas
(air quality, waste water…)– Natura 2000 is protects specific areas– Common Agricultural Policy differentiates
support for less favoured areas– State aid rules have an exemption for
islands with less than 5 000 inhabitants
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Territorial impact assessments
• Directive 2002/3/EC indicates two thresholds:– ozone concentration of
8-hour daily mean of 120 μg/m3 or more
– agglomeration with 250 000 inhabitants or more or zones with a high population density selected by MS
• Territorial impact combines both
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Chapter 4:Chapter 4:
The Impact of Cohesion PolicyThe Impact of Cohesion Policy
Social, economic and Social, economic and environmental benefitsenvironmental benefits
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
The impact of Cohesion Policy
• Cohesion Policy improves not only economic, but also environmental and social development
• Objective 1 regions increased their long term productive potential and enhanced the level of GDP per capita
• Modelling suggests that the entire EU, not just supported regions, is better off with Cohesion Policy than without it
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Innovation and entrepreneurship
• Targets mostly small and medium sized enterprises and start-ups
• At least 1 million gross jobs were created in supported companies
• increased private investments and R&D activity in firms
• But support for large firms may not be necessary
• Bigger role of loans?
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Promoting employment, education and inclusion
• 40% of the unemployed trained have found a job
• Funded one third of Active Labour Market Policies expenditure
• targets specific vulnerable groups such as youth, women, minorities, low-skilled, long-term unemployed…
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Cohesion policy has improved connectivity
• 2,000 km of motorways built
• the construction of 4,000 km of rail, including high-speed
• Future focus should be on greener modes, urban public transport and inter-modal links and on motorways only outside the EU-15
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Improving access to clean water and treating urban waste water
• Faster implementation of environmental directives
• An additional 23 million inhabitants are served by waste water projects to EU standards, but more is needed
• An additional 20 million inhabitants have been served by water supply projects
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ConclusionsConclusions
The proposals for the future of The proposals for the future of
Cohesion PolicyCohesion Policy
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Cohesion Policy: key role to achieve EU 2020 goals
Europe 2020 Strategy – a new strategy for Europe
•Smart growth
•Growth for all
•Sustainable growth
EU Member States will propose national targets for 2011
Future Cohesion Policy must be aligned with Europe 2020
Funding will remain concentrated in less developed regions
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
IV. Options for the future Cohesion Policy
1. Enhancing European added
value
2. Strengthening governance
3. Streamlining delivery
4. Architecture of Cohesion Policy
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
1. Enhancing European added value
• Reinforcing strategic programming – translate EU 2020 objectives into investment priorities
• Focus resources on limited number of key priorities
• Introduce stronger incentives and conditionality
• Improving evaluation, performance and results
• Stronger emphasis on new financial instruments
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
2. Strengthening governance
• Reinforcing partnership (improve involvement of local and regional stakeholders, social partners, civil society)
• Introducing a new dimension: territorial cohesion
– Reinforcing territorial co-operation (more cooperation between regions within a country, macro-regional strategies…)
– Developing an ambitious urban agenda
– Addressing areas with specific geographical or demographic features
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
• Improving financial management
• Reducing the administrative burden
• Simplifying financial discipline
• Reviewing financial control
3. Streamlining Delivery …based on lessons learnt
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
• Full geographical coverage distinguishing between:– Less developed regions– More developed regions– Transition regions replaces current phasing-out and
phasing-in– Territorial cooperation with its 3 strands
• In line with the Budget Review:– How can the ESF be refocused on securing the 2020
targets?– How can the ESF achieve greater visibility and
predictable funding volumes?– How can the ESF better serve the European
employment strategy?
4. Architecture of the policy
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Timeline
• 19 October 2010: Budget Review (COM(2010)700)• 9 November 2010: Fifth Cohesion Report• 11 November 2010 – 31 January 2011: public consultation • 31 January/1 February 2011: Cohesion Forum
• Spring 2011: Proposal on future financial perspectives• Summer 2011: Legislative proposals • End 2012: Adoption of new legislative package and
expected agreement on new budget post 2013
• 2013: Finalisation of new programming documents• 2014: Entry into force
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European UnionRegional Policy – Employment, Social Affairs and Inclusion
Make your voice heard!
Public consultation open until 31 January 2011:
ec.europa.eu/regional_policy/cohesion_report
Thank you for your attention!