EU publishes its cohesion policy

The multiple speed Europe is not a new subject. The current state of affairs dissatisfies both policymakers and citizens. With the Greek crisis, and the fear of new “Brexits” is on the rise, European authorities decided to draft an action plan to tackle the issue. Last Tuesday (April 11), the Commission released a document entitled “Competitiveness in low-income and low-growth regions: The lagging regions report“.

With regards to low growth regions, the Commission lists many in Greece, Italy, Portugal and Spain. While low-income regions are mainly situated in Eastern Europe:  Bulgaria, Hungary, Poland, and Romania. Combined these regions total 83 million people, i.e., almost one-sixth of EU citizens.

The text is the result of a decision taken by Corina Creţu, the Commissioner for Regional Policy, back in June 2015. The report lists bottlenecks regarding economic development in these regions and proposes measures that shall help them to grow their economy.

According to the findings, these regions have been facing five different obstacles to their full development:

1) Macroeconomic policies have neglected these regions, especially after the crisis. Governments failed to implement structural reforms to boost growth. Among the reasons for such constraints are public and private debt combined to with reduced lending capacity;

2) The regions facing economic hardships have many things in common. They have issues with regards to productivity, education, and employment. This poor business environment highlights the need for reform;

3) This item derives from the second one. These regions have issues with productivity because they have been unable to use the latest technologies available in the marketplace. This situation results both from lack of funds and adequate human resources.

4) The lack of economic growth has pushed many young qualified professionals to seek employment in other regions.

5) Private investment fell dramatically in these regions. Most economic activities rely on commodities, real state, and manufacturing of low capital input.

European authorities detailed cohesion policies that will enable these regions to finally recover their dynamism, as follows:

1) Address the obstacles aforementioned by fostering partnerships between companies and universities, the so-called “smart specialization strategies”.

2) Invest in infrastructure and talent retention, these regions still find hard to move goods elsewhere;

3) Public administration should also reform to better serve the needs of their citizens: new digital tools should facilitate accountability and procurement, to name a few;

4) Adjust macroeconomic policies to create a better business environment for the regions in question.

These are the main principles that will guide public and private actors to recover economic growth. It should be noted that every region has its particularities, which makes clear that one size doesn’t fit all.


In the press release issued on April 11, Regional Policy Commissioner Creţu stated:

“For each obstacle to development, there is a Cohesion Policy answer. Tailor-made regional development strategies, combined with preconditions for successful investment, can make these regions attractive places for residents, workers, and businesses. This is what we do: we help regions identify their needs and their competitive assets and we provide them with the tools for better policy making.”


The EU is taking the lead to pass reforms that should have been locally implemented at the height of the crisis.

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