EU Regionalförderung: Reformen für die nächste Finanzperiode

Abstract

Abstract In their paper Peter Egger and Maximilian von Ehrlich summarize recent research on the effects of European regional policy. Results point to a positive effect of this policy on average. One Euro spent even tends to generate more than one Euro in return in terms of GDP. However, the response varies drastically across recipient regions. First of all, there is evidence of existence of an optimum funding ratio (funds allocated relative to recipient GDP) where one Euro invested generates one Euro of return. About 36 percent of the regions receive higher funding than that, where one Euro generates less than one Euro of return (and, eventually, no return at all). Second, there is evidence of a bigger return on investment in regions with higher absorptive capacity level - measured by human capital endowments and the quality of recipient institutions. Insufficient levels of absorptive capacity lead to a wash of the Union’s transfers. About 70 percent of the regions exhibit such an insufficient level of absorptive capacity. Friedrich Heinemann analyzes both, the reform needs and reform obstacles of EU cohesion spending. Although the empirical evidence is unable to substantiate an European added value, structural funds continue to absorb an increasing amount of resources. The analysis reveals several shortcomings of this policy: First, EU regional programs have neglected institutional constraints on the side of recipient countries and regions. Second, an inflation of policy objectives makes a clear performance measurement increasingly impossible. And third, through the inclusion of rich regions into its programs, cohesion spending has lost its focus. To tackle these shortcomings, a comprehensive reform package is recommended which includes new incentives on the financing side of the EU budget. Only increasing regional co-financing or other financing innovations can reduce disincentives from common pool-financing and overcome reform resistance. Without any such financing side reforms, merely some incremental reforms are consistent with political-economic constraints, he states. Werner Hoyer and Markus Brandt point out, that all in all, EU Cohesion policy has been a success. It has facilitated growth and jobs in less developed areas, contributing to their prosperity. However, convergence has slowed down significantly during the crisis. This puts even more pressure on safeguarding that cohesion policy generates optimal results to ensure lasting economic and social cohesion. Room for improvement has been identified. The delivery mechanisms can be improved; its territorial dimension strengthened; and its focus more firmly directed at supporting a resourceefficient economy, research, development and innovation. Even more important, the economic crisis in the EU has underscored the need for creating pan-European institutions, like the banking union, to complete the integration of financial markets. The recent substantial reforms of the EU’s economic architecture are aimed at creating an unprecedented level of integration that will allow private capital to flow more easily and more responsibly to the most productive and growth-enhancing investments in convergence regions. The unleashing of these market forces, combined with a reformed cohesion policy to efficiently address market failures where they exist, carries the potential to initiate a new success story in the convergence of living conditions in the EU. They emphasize that the EIB is committed to play an important role in this effort. It has already integrated the new smart and sustainable orientations of the Structural Funds and will strive to facilitate better alignment between its sector and regional objectives. Expanding and deepening the nature and scope of financial and non-financial instruments developed jointly with the European Commission will further improve the leverage effect of EU funding and help attract private investors.