1 investing in europes future the fifth cohesion report presented by lewis dijkstra and elisa roller

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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

3

Promoting competitiveness Promoting competitiveness

and convergenceand convergence

4


Regional disparities in the world

5


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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…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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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

8


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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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


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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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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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

12


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

13


More tertiary educated and less early school leavers boosts innovation

Innovation

14


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

15


E-government services

Institutions

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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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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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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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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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Life expectancy lower in the East

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Preventable mortality

23


Mortality rates high less developed MS and regions

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Unemployment dropped in most regions until the crisis hit

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Equal opportunities: good news

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… and some bad news

27


Born outside the EU/US

28


Lower employment rates for born outside EU

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Population change

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East and West: opposite trends

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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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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


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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Poverty and deprivation have a strong regional dimension

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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


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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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


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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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


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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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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Renewable energy potential

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… and Member States’ commitments

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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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Air quality low in several cities

43


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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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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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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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

48


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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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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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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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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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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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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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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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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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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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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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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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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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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• Improving financial management

• Reducing the administrative burden

• Simplifying financial discipline

• Reviewing financial control

3. Streamlining Delivery …based on lessons learnt

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• 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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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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Make your voice heard!

Public consultation open until 31 January 2011:

ec.europa.eu/regional_policy/cohesion_report

Thank you for your attention!

1 investing in europes future the fifth cohesion report presented by lewis dijkstra and elisa roller

Documents

social inclusion

social affairs

inclusion regional disparities

east slide

populated slide

convergence slide

future slide

world slide