THE REGIONS, THE CRISIS, GOVERNANCE AND THE FUTURE OF EUROPEAN POLICIES

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THE REGIONS, THE CRISIS, GOVERNANCEAND THE
FUTURE OF EUROPEAN POLICIES

• CPMR Policital Bureau, Odessa, June 12th 2009

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SUMMARY

• 1. Overview of global economic situation
• 2. Impact of the crisis on EU Regions
• Survey
• Policy Workshop and Manifesto
• 3. Regional policy
• Barca report
• Preparing Göteborg General Assembly

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1. OVERVIEW OF GLOBAL ECONOMIC SITUATION

• Based on forecasts from EU DG ECOFIN,
  International Monetary Fund, OECD, World Bank
• Based on main available indicators GDP,
  employment, wages, investments

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THE EU IN THE WORLD LOSING MOMENTUM
? GDP growth 2009 as a black year for most
advanced economies Russia and Brazil ? Asian
economies to continue growing even though at
lower speed
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THE EU IN THE WORLD LOSING MOMENTUM
? GDP/head horizon 2014 EU and Japan losing
track of the US, China accelerating convergence
during the crisis
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THE EU IN THE WORLD LOSING MOMENTUM
? Share of world GDP the US and EU losing
momentum, China and India catching up
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WITHIN THE EU VERY DIVERSE PICTURES

• Only 1 EU country with positive GDP growth in
  2009 (CY)
• 14 countries will remain in recession in 2010
  (grey zones)

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WITHIN THE EU VERY DIVERSE PICTURES

• Only 4 EU countries with a GDP/head higher in
  2010 than in 2008 (CY, PL, SK, EL)
• In LU and IE, each citizen will have 4.000 to
  5.000 US in his pocket

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WITHIN THE EU VERY DIVERSE PICTURES

• Unemployment raising in all EU countries
• Unemployment rate above 10 in 12 EU countries in
  2010, above 20 in Spain

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WITHIN THE EU VERY DIVERSE PICTURES

• The Lisbon strategy 70 employment target missed
  after having been achieved in 2006
• Back to the 2000 situation

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WITHIN THE EU VERY DIVERSE PICTURES

• Real wages growth slowing down in most EU
  countries
• Consecutive decrease in real wages in 2009/2010
  in 4 countries (LT, EE, IE, LV)

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UNCERTAIN OUTLOOK FOR 2010 AND BEYOND

• Worsening forecasts for 2010 (GDP, employment and
  investments)

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VARIOUS PERCEPTIONS OF THE SITUATION

• Citizens feeling concerned for mid-term
  perspectives (Source Eurobarometer jan/feb 09)

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VARIOUS PERCEPTIONS OF THE SITUATION

• Markets comforted by G20 decisions and national
  recovery plans (Eurostoxx 50)

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2. IMPACT OF THE CRISIS ON EU REGIONS

• CPMR Regions participating in the survey

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2. IMPACT OF THE CRISIS ON EU REGIONS

• Diverse regional profiles
• Difficulties to get quantitative data gt
  Qualitative answers

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2. IMPACT OF THE CRISIS ON EU REGIONS

• Most Regions medium or strongly impacted

• Some Regions expect the crisis to unfold only in
  the coming months
• Export-oriented and mono-sector Regions as well
  as declining industrial districts first and
  strongly hit
• Differenciated impacts within Regions according
  to economic specificities

No impact Low impact Medium generalized impact Medium-strong impact on few specific sectors Strong generalized impact
-Shetland Is. -Aberdeen --Ionia Nisia -Stockholm -Anatoliki Mak.- Thraki -Podlaskie -Itä-Uusimaa -Primorsko-goranska -Region Midtjylland -Principado de Asturias -Friuli V. Giulia -PACA -Basse Normandie -Österbotten -Päijät-Häme -Västra Götaland -Nordland -Blekinge County -Bretagne -Toscana -Puglia -Illes Balears -Castillia y León -Cornwall -Hampshire -Lisboa-Vale do Tejo -Somerset -Wales -East of England
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2. IMPACT OF THE CRISIS ON EU REGIONS
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2. IMPACT OF THE CRISIS ON EU REGIONS

• Few sectors left unaffected but a same economic
  sector can be very differently impacted according
  to the Region in which it is set

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2. IMPACT OF THE CRISIS ON EU REGIONS

• Unemployment to severely affect the majority of
  surveyed regions (17), however the social
  outwards signs of the crisis are numerous...

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2. IMPACT OF THE CRISIS ON EU REGIONS

• A broad range of regional responses raising the
  key question of governance

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2. IMPACT OF THE CRISIS ON EU REGIONS

• According to competences and budgets, /- formal
  measures packages (7 adopted a formal recovery
  plan) including

• Budgetary / Fiscal measures
• Support to public investment (short and long
  term)
• Support to businesses / SMEs (access to credit
  with guarantee funds or preferential loan
  schemes)
• Support to labour market (passive and active
  employment policies)
• Social interventions
• Regulatory measures
• Reduction of administrative burden for
  businesses
• Improve efficiency in public spending
• Advisory measures and services
• For the business community
• For citizens
• Governance measures
• Strengthening existing partnerships
• Creating new partnerships / ad hoc mechanisms

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2. IMPACT OF THE CRISIS ON EU REGIONS

• Different approaches towards the use of
  Strucutral Funds in sustaining recovery

Approach Reasoning Regions
Ops have not been changed 1. The SF are not counter-cyclical measures Österbotten Västra Götaland
Ops have not been changed 2. The measures contained in the operational programs are still valid Ionian Is. Puglia Asturias
Ops have not been changed 3 SF amount for a very small share of regional investments Päijät-Häme
Ops have not been changed 4. Only delivery on the ground is likely to be re-adapted East of England (ESF)
Ops have not been changed 5. OPs may be changed in the future should circumstances dictate Ionia Nisia East of England (ESF)
Ops needs to be partially revised 1 A certain re-prioritization of interventions along with speeding-up of project approvals and implementation is needed A. Mak-Thraki Podlaskie Toscana B. Normandie (ERDF)
Ops needs to be partially revised 2 Some shift in priorities have been made/will be made to readjust the Ops to the changed economic conditions Lisboa-Vale do Tejo Itä-Uusimaa (ESF)
Ops needs a radical readjustment The Structural Funds system should be made more flexible to make it easier for the private sector to access to fund. Cornwall
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2. IMPACT OF THE CRISIS ON EU REGIONS

• CPMR initiatives

• CPMR Policy Workshop, 16th July, Brussels
• Manifesto 10 signing Regions, 2 asking for
  amendments
• CPMR Seminar  Impact of the crisis on post 2013
  EU policies what the regions expect ,
  Marseille, 27th November 2009
• Going on surveying regional situations?

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3. IMPACT ON THE DEBATE ON REGIONAL POLICY POST
2013

• On the one hand

• Low Structural Funds consumption rates (7 in
  average) used as argument by opposants to
  Objective 2
• The crisis will have unpredictible impacts on GDP
  levels 2010/2011 which basis for regional policy
  envelopes calculation?
• The  Barca  report proposes DG Regio embarrased
  with the  Barca  report a CPMR Contribution?

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3. IMPACT ON THE DEBATE ON REGIONAL POLICY POST
2013

• DG Regio embarrased with the  Barca  report
  supporting a modernized cohesion policy for all
  EU Regions
• but still shows no clear vision / ideas for the
  future
• CPMR preparing its proposals for the Gothenburg
  AGM

• On the other hand