& Events

The right to stay in your local community

Apr 22, 2024 | News

The Cohesion Forum was held in Brussels on 11-12 April, to take stock of the progress of EU Cohesion Policy as extensively analysed in the 9th Cohesion Report unveiled on 21st April. The landmark event attended policymakers, researchers and policy analysts including AEIDL, was also the launchpad for the next Cohesion Policy 2028-2034 whose legislation will be tabled in Spring 2025. 

Perhaps the most remarkable contribution was that of Enrico Letta, whose Report on the Future of the EU Internal market, presented to EU leaders a week after, on 17 April, makes a strong call for the EU to enforce the principle of the “freedom to stay”, as to help many areas across Europe stop losing population and basic services. Quoting former EU Commission president Jacques Delors, he said that there cannot be a freedom to move across the EU if the EU cannot guarantee the freedom of those that choose to remain. 

Mr Letta is scoping an ambitious set of reforms to ensure that the main in which Cohesion policy has a key role, but not only. His report is advocating for a serious rethink on the availability of basic services (Services of General Interest) everywhere in the EU, the simplification and boosting of state aid and of procurement to promote social inclusion and SMEs (while harmonising enforcement EU wide) as well highlighting the urgency as tacking the issue of housing. He even hinted at possible “buy local” clauses in procurement that though are presently forbidden, are indeed possible in other trading blocks including the US. To coordinate all this next European Commission should appoint a Vice responsible for the ‘freedom to stay’ with a portfolio to include at least cohesion policy, Services of General Interest, and support for SMEs.

 All in all, the report has the potential to be a gamechanger – if taken up by the new EU leadership after the June elections. Either way, it has done an unprecedented service to EU Territorial Cohesion policies, as bringing the place-based dimension to debate of the future of the EU Single Market.

The 9th Cohesion Report also found that EU regions have achieved remarkable convergence, largely thanks to cohesion policy. In the Member States that joined since 2004, GDP per capita increased from 52 % of the EU average in 2002, while unemployment fell from 13 % to 4 %.

Another key issue much discussed in the report is that of the “development traps” that many territories are facing across the EU, where no less than 50 million Europeans live in regions that have not grown since the 2008 crisis.

Cohesion policy investments in the 2014-2020 and 2021-2027 programmes are expected to increase EU GDP by 0.9 % by 2030. The programmes have long lasting effects and 30 years after their start, each euro invested will have generated three additional euros of GDP. Despite progress, challenges persist. Demographic changes, including an aging population and a shrinking labour force, affect all regions. These challenges are more acute in rural and thinly populated areas as indeed it is the case of many mountain areas.

Rural, mountainous, island, and sparsely populated areas continue to face specific challenges that hinder economic growth and development, stemming from lower physical and digital connectivity or limited education and training opportunities. Average income in rural areas is 87.5 % of average income in urban areas. However, over the period 2001- 2021, non-urban regions (on average) experienced a significantly higher GDP per capita growth than urban regions: 1.5 % as opposed to 0.8 %. The trend is nonetheless different in Eastern Member States, where the growth is more prominently driven by large agglomerations and capital cities. However, these are also the areas facing the most severe brain drain one of the key elements of the so called geography of discontent.  

The public report on “The long-term vision for the EU’s rural areas: key achievements and ways forward” presented at the same time as the 9th Cohesion report, while noting that 24.6bn euro or 8% of the Rural Development pillar of the Common Agricultural Policy. At the same time is making investments in rural areas beyond farming sets the scene for a debate on the future of rural areas post 2027. This report also highlights the work carried out by the Rural Pact Support Office, and projects such as GRANULAR, and where AEIDL is involved.

The Cohesion Forum also made much emphasis of the challenges to achieve the digital and green transitions but was also very emphatic on the need to prepare for a future enlargement. A recent study showed that it would result a €60bn or 20% loss of present Cohesion Budget. It was also widely noted that the likely increase in defence expenditure due to the war in Ukraine cannot be done at the expense of EU Cohesion Policy which together with CAP amount to two thirds of the EU budget.

AEIDL will continue engaging on the debate of the future of EU policies to promote local development post 2027 that will take place ahead of the tabling of the new Regulations for post 2027 programmes in the Spring 2025.