The 9th Cohesion Report and the review of the Long-Term Vision for Rural Areas chart the future policies awaiting EU mountain regions

Apr 17, 2024

Author: Serafin Pazos-Vidal (AEIDL)

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, a MOVING partner, was also the launchpad for the next Cohesion Policy 2028-2034 whose legislation will be tabled in Spring 2025. Therefore, the end of MOVING and the policy roadmap that will be finalised at its final conference on 13-14 June in Brussels takes place at an optimal time for the project findings to be utilised to shape the next programmes for mountain areas.

The 9th Cohesion Report 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 %.

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. 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 is making investments in rural areas beyond farming sets the scene for a debate on the future of rural areas in the future.

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.

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, there cannot be a freedom to move across the EU if the EU cannot guarantee the freedom of those that choose to remain.

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.

Last but not least the €800bn Next Generation EU package set up in 2020 as a result of the COVID-19 crisis, was a significant shift in the way EU investments are done, and may result in some of this being also applied to EU cohesion policy to ensure that funding is spend faster and with less bureaucracy and oriented to tangible results. However the bottom-line is to ensure that Cohesion Policy remains a multilevel policy that covers the entirety of the EU and empower local areas.