Cohesion policy must be revamped ‘to ensure Europe’s survival’, EU report finds

The EU’s cohesion policy must be urgently restructured to stem the rise of Eurosceptic parties that threaten the “survival” of the European project, according to an independent study set up by the European Commission.

The report on the bloc’s multibillion-euro investment initiative aimed at reducing the bloc’s regional inequalities – published on Tuesday (20 February) – called for a more “performance-based” approach to cohesion measures, also urging for red tape to be cut.

“We need to act, and we need to act now,” said London School of Economics professor Andrés Rodríguez-Pose, who authored the study, adding: “What is at stake is something that hasn’t been at stake for a very long time, which is the survival of the European Union itself.”

As many as 60 million European citizens currently live in regions where GDP per capita is lower than in 2000, the study found, while a further 75 million reside in places where annual GDP per capita growth has only been marginally above 0% since the turn of the century.

The study found that such “development traps” are predominantly located in rural or deindustrialised areas — the same places where anti-EU sentiment is “particularly pronounced”.

“Recognising and reducing economic inequality as well as addressing the developmental, social, and political challenges faced by various regions is crucial to countering the rising tide of Euroscepticism and reaffirming faith in the European project,” the report notes.

Improving integration

Among the report’s key policy recommendations were improving the “institutional quality” of underdeveloped regions; making cohesion policy more “performance-based”; and offering more technical support and reducing the bureaucratic burden for cohesion fund applicants.

The report also called for integrating cohesion policy more closely with other European initiatives, including the Common Agricultural Policy, to “ensure that all policies deliver on their goals”.

Philipp Lausberg, an analyst at the European Policy Centre, agreed that cohesion policy could be used as a “strategic” instrument to counter the rise of Euroscepticism.

“Cohesion policy can be a tool when it comes to disadvantaged or deindustrialised areas of Europe, [to] make sure that people are not left behind and that they don’t look for easy answers in right-wing populist parties,” he said.

Lausberg also agreed with the study’s proposal to integrate cohesion policy more closely with other EU initiatives but stressed the need for an “overarching” European investment framework to fulfil the bloc’s core strategic ambitions, including the digital and green transitions.

€1040 billion in cohesion funds have been invested since the EU’s modern cohesion policy was initiated in 1989. This includes €392 billion of the bloc’s Multiannual Financial Framework for 2021-2027, or roughly one-third of the current EU budget.

[Edited by Nathalie Weatherald]