Regions and Cities: €315bn EU Plan must reduce disparity
Local and regional leaders from across Europe presented today their proposals to improve the € 315bn EU Investment Plan launched by the European Commission. The European Committee of the Regions (CoR) adopted its position on the EU regulation of the European Fund for Strategic Investments (EFSI), established by the Plan. The opinion, drafted by the President of the Picardy Region, Claude Gewerc (FR/PES), warns against the risk of territorial concentration and calls for greater attention to be given to weaker regions. It pleads for coordination between the Investment Plan and EU structural funds, as well as for a stronger role for Europe's local and regional authorities in identifying and delivering strategic projects.
Regions and cities want EU investment to contribute to achieving economic, social and territorial cohesion in Europe. "Clear references to the territorial dimension of the Juncker Plan are needed. We must also consider how to reduce investment gaps and pay more attention to less developed and isolated regions" CoR President Markku Markkula stressed. "Through integrated investment and collaboration at EU level, regions and cities will be able to implement their smart specialisation strategies: these will be key drivers for economic growth, innovation and employment in the future." The CoR also called for clearer rules to ensure the fund complements the EU's existing growth strategy - notably structural and investment funds - without any crowding out or overlapping.
"Regions will play a key role in the successful implementation of the European Fund for Strategic Investments. I encourage them to get active and make use of the additional investment potential provided by EFSI" said the Vice-President of the European Commission, Jyrki Katainen. He added: "The Commission can provide the framework but the projects will come from the regions. Now there is an excellent opportunity to put forward different projects that originate from regional conditions and needs with a higher risk profile. I very much look forward to our cooperation with the aim to bring much needed private investments to Europe".
The CoR insists on the effectiveness of such a bottom-up approach and considers investment platforms - co-financing mechanisms established at regional, national, cross-border or sectorial level to finance a group of projects - to be the key to ensuring all of Europe's regions are involved. The EFSI regulation should provide a clear definition of platforms’ function and the participation of Member States, as well as of regional and local authorities, should be encouraged. The national co-financing of the Juncker Plan should not be curbed by the Growth and Stability Pact, and the CoR reiterates its call to extend this favourable treatment to the co-financing of all projects supported by EU structural and investment funds.
"For the Plan to succeed the Commission and co-legislators must avoid a top-down approach in shaping and implementing the EFSI", argued rapporteur Gewerc. "Regional and local authorities should be structurally involved notably in developing the project pipeline - where they can ensure regional scale projects and credit facilities for SMEs are considered - as well as provide advice and strategic support through the European Investment Advisory Hub". The new hub should also count on local and regional development experts to support regions and cities in promoting private investment for growth. Support should be offered free of charge for local and regional authorities.
To ensure local and regional authorities are better informed on the opportunities offered by the EFSI and by existing European Investment Bank (EIB) financing, the CoR and the EIB are intensifying their cooperation and will implement common activities so that regions and cities make the most efficient use of public spending.
With regards to the financing of the Plan, the Committee fears strategic tools - such as Horizon 2020 and the Connecting Europe Facility - could be weakened by diverting part of their allocations to fund the EFSI. All flexibility margins existing in the EU budget should be exploited before opting for reducing Horizon 2020 and CEF funds. The European Parliament should then progressively authorise such a reduction after assessing the real absence of alternatives.
The next step in the EFSI legislative procedure is the adoption of the European Parliament draft report at committee level. President Markkula will also provide input from regions and cities through cooperation with the Intergroup on Long Term Investment and Reindustrialisation which was launched at the CoR last Monday.