see also:

• European Union
• European Union - enlargement  
• European Regions and independence movements
• Development - economic development (folder with lots of files on development)
• course:  Forum-Nexus Introduction to the European Union

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Table of Contents:

Cohesion Policy - what?

• money transfers from rich to poor regions in the European Union
• cross-border transfers for economic development of poorer regions of Europe

Cohesion Policy - why?

To support the single market project:

• First - start with the concept of a "single market" for Europe.
• Second - add fear (that jobs will be lost as companies move production to cheaper-labor regions)
• Third - cohesion policy

For peace:

• "I believe one hundred percent in cross-border projects, this is the kind of policy that generates change. And we should particularly foster cross-border co-operation with regions outside the EU, because the EU is first and foremost a peace-building project," he argued.^[1]

Ranking Regions based on wealth:

see http://epp.eurostat.ec.europa.eu/statistics_explained/index.php/GDP_at_regional_level 

• "the differences between Member States are quite large but decreasing"
• Rich:  The regions with the highest per-inhabitant GDP are in southern Germany, in the south of the UK, in northern Italy and in Belgium, Luxembourg, the Netherlands, Austria, Ireland and Scandinavia. The capital regions Madrid, Paris and Praha also fall into this category.
• Poorer:  The weaker regions are concentrated at the southern, western and south-eastern periphery of the Union, in eastern Germany and the new Member States, Croatia, the former Yugoslav Republic of Macedonia and Turkey.
• Variation:  Within the EU, per-inhabitant GDP ranges from 26 % of the EU-27 average (6 400 PPS) in Severozapaden in Bulgaria to 334 % (83 200 PPS) in the capital region of Inner London in the UK.
• Ranking 2007^[2]
1. Luxembourg at 275 % (68 500 PPS)
2. Brussels at 221 % (55 000 PPS)
3. Hamburg at 192 % (47 800 PPS)
4. Praha (Prague) at 172 % - Prague (Czech Republic) thus remains (by an increasing margin) --  the region with the highest per inhabitant GDP in the

Of the city/regions of the new Member States;

• Prague is the richest (#4 total in EU)... followed by:
•  #12.   Bratislava - (Bratislavsky kraj) (Slovakia) follows with 160 % (39 900 PPS) in position 12 of the 271  statistical areas (known as NUTS 2 regions of the countries examined here
• #94.  Zahodna Slovenija (Slovenia) at 107 % (26 600 PPS)
• #111. Kozep-Magyarorszag (Hungary) at 103 % (25 600 PPS)
• #146.  Cyprus at 94 % (23 300 PPS)

With the exception of four other regions (Bucureşti–Ilfov in Romania, Mazowieckie in Poland, Malta and Středni Čechy in the Czech Republic), all the other regions of the new Member States have a per inhabitant GDP in PPS of less than 75 % of the EU-27 average. ^[3]

Official Report from the Commission (on cohesion policy)

Fifth Report on Economic, Social and Territorial Cohesion: "Investing in Europe’s future"

  (158 Mb)
The data behind the maps in the report can be found here.

*official video from EU

http://ec.europa.eu/regional_policy/sources/docoffic/official/reports/cohesion5/index_en.cfm 

Regional issues:

see also: 

• European Regions and independence movements

Budget - from the European Union

"the policy, which currently accounts for over a third of the overall EU budget"^[4]

Cohesion Funding - where the money comes from

In general - money flows from richer states to poorer ones.  North to South.  West to East.

Countries outside the EU:

• some money for EU cohesion policy actually comes from countries outside of the European Union  (but still in Europe)
• For example, "Norway, Iceland and Liechtenstein on Wednesday (28 July) agreed to donate €1.79 billion to the EU's poorer southern and eastern members in the coming five years for green projects, labour rights, research and human resources, a top-up of 22 percent compared to the previous period.   The funding scheme is part of the "European Economic Area (EEA)" agreement which ties the three countries to the EU, allowing them to participate in the internal market without actual membership of the bloc." .... read more from EUobserver.com here
• "Switzerland, also a non-EU member integrated in the internal market and the border-free zone of the EU, has a parallel funding scheme for the new member states. Brussels is now looking at ways to integrate Bern into the EEA agreement – to which Swiss voters said no in a referendum in 1992." ^[5]
• So, countries such as Norway (which want access to the EU market), pay money to help fund Cohesion in exchange for market access.

Where does the money go?

• Norway's money will go to:  "all eastern European countries plus Greece, Spain and– have been quarrelling over who gets what....Poland will continue to be the biggest recipient of the scheme, with €578.1 million, followed by Romania, for whom €306 million have been earmarked....The bulk of the money will be allocated to environment protection programmes, renewable energy and the development of "carbon capture and storage" technology aimed at reducing CO2 emissions." ^[6] .... in other words to the Environment, a high priority policy area for Norway. 

Issues -

1.  potential for corruption

"potentially indicating fraud in the use of EU regional aid, which has regularly seen the Court of Auditors raise red flags." ^[7]

2.  Potential for waste 

think of all the "bridges to nowhere" that could be built with this kind of money at stake