The European Commission adopted a report today highlighting the contribution of Cohesion Policy in the European Economic Recovery Plan and its support for the real economy. The report details measures to accelerate ‘smart’ investment at national and regional level by simplifying access to grants, facilitating support to people hit by the crisis and increasing the availability of finance for small and medium sized enterprises (SMEs).
The Commission makes recommendations in the following areas:
Accelerating investment to create demand
Cohesion Policy is the Community’s largest source of investment in the real economy. With significant financial resources (€ 347 billion over the period 2007-13), this policy provides vital support and stable investment at local and regional level. The public sector has an essential role to play in restoring confidence; in some Member States, particularly in Central and Eastern Europe, the relative contribution of Cohesion Policy in total public investment amounts to over 50%.
Accelerating structural funds’ investment helps create demand in key sectors of the economy and front-loading resources provides an important financial stimulus in the short term. Innovative financing schemes can also facilitate access to secure finance. The Commission and the European Investment Fund (EIF) are encouraging Member States to take advantage of the JEREMIE scheme (Joint European Resources for Micro to Medium Enterprises), which makes it easier for SMEs to obtain loans. With the European Investment Bank Group, the Commission is also backing JASMINE (Joint Action to Support Micro-Finance Institutions in Europe), which helps non-bank micro-credit providers to improve their services and become sustainable.
Funding targeted at growth and jobs
Of the funding allocated under the Cohesion Policy, more than 65% (€230 billion) is earmarked for investment in the four priority areas of the Union’s growth and jobs strategy – people (employment), business, infrastructure and energy, research and innovation. This focus is crucial as these priorities will contribute to a quicker recovery, improve competitiveness and help the Union adapt to a low-carbon economy.
The report suggests that some Cohesion Policy programmes may need to be reviewed to increase focus on investments in areas of immediate growth potential or in the sectors most affected. Member States’ national strategic reports (due at the end of 2009) will be an opportunity to report on early results and plan for revised national and regional programmes. To help Europe weather the downturn, the Commission recommends that European Social Fund programmes are refocused to help the unemployed back into jobs, prevent long-term unemployment and to raise overall skill levels to better match with labour market needs. It also encourages Member States to invest more in energy efficiency, clean technologies, sustainable transport infrastructure, energy connections and broadband networks.
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