Cities and regions must play a lead role in shaping investment and economic reform plans  

Basb VAN DEN Barg, Rob Jonkman

The European Committee of the Regions' (CoR) commission for economic policy (ECON) adopted today by unanimity an opinion on the interlinkages between the European Semester and cohesion policy. ECON members stressed that local and regional authorities must play a lead role in shaping the development of country-specific recommendations on investment and economic reform plans. They also debated the challenges facing the socio-economic transitions of coal regions in Europe, the impact of Brexit, and how to move towards a sustainable Europe.

As a part of the efforts to improve the implementation of the European Semester - the EU's primary tool for coordinating its Member States' budgetary and economic policies - the European Commission aims to introduce greater coordination between the European Semester and cohesion programmes. Cohesion policy is the European Union's main investment policy and aims to narrow the persistent social and economic disparities between and within regions in Europe.

As of 2019, in the context of the European Semester, the Commission's country-specific recommendations (CSRs),  together with national reform programmes (NRPs), will form the basis for prioritising not only structural reforms, but also investment projects, including those to be supported with EU funding. Around 60% of all cohesion policy programmes currently fall under the purview of the CSRs, which highlights the explicit connection between the European Semester and cohesion policy at the local and regional level.

Rob Jonkman (NL/ECR), rapporteur of the CoR's opinion on the European Semester and Cohesion Policy and Member of the Executive Council of Opsterland, emphasised that “Cities and regions are formally recognised as partners in the delivery of EU investments through the rules governing the use of Cohesion Funds. However, in the European Semester process, during which the investment recommendations are formulated, local and regional authorities are sometimes excluded from the process entirely or only treated as one of many stakeholders. This needs to change".

The draft opinion adopted during the meeting recommends that local and regional authorities should have a formal, structured and permanent presence in the European Semester and recalls that the CoR had proposed to establish a code of conduct to this purpose. Side-lining local and regional authorities - the key implementing actors of CSRs - from the European Semester risks leading to a lack of ownership over programmes and policies, inevitably leading to poor delivery.

During the ECON meeting members also had a first exchange of views on the socioeconomic transformation of coal regions in Europe triggered by the EU's commitment to the long-term decarbonisation of its energy system. Lignite and coal are currently mined in 41 NUTS-2 regions with about 185 000 employees, and there are coal-fired power stations in 103 NUTS-2 regions employing 52 000 people. According to a study by the European Commission another 215 000 jobs are linked to the coal industry in various economic sectors and some 160 000 jobs could be lost by 2030 as a result of phasing out using coal for power generation.

This structural change leads to fierce challenges for so called coal regions as the coal industry plays a dominant role in their economy. It is above all local and regional authorities, who must find local responses to soften the impact on employment and value creation. The discussion will feed into the draft opinion prepared by Mark Speich (DE/EPP), Secretary of State for Federal, European and International Affairs from North Rhine Westphalia, who will present the first draft of local and regional solution during the ECON meeting on 9 July2019.

The local and regional politicians furthermore debated the European Commission's reflection paper for a sustainable Europe by 2030 and the local and regional implications of Brexit as well as renewed their cooperation with the European Investment Bank and Eurochambres with updated actions plans.

Contact:

Carmen Schmidle
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carmen.schmidle@cor.europa.eu