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ARLEM reports: Innovation urgently needed in Mediterranean economy  

Leader of Andalucía and the head of Morocco's association of mayors stress the urgency of innovation and sustainable development to cope with the effects of the pandemic.

The development of innovation ecosystems and the management of changes to the tourism industry will be critical to the long-term recovery of Mediterranean economies from the impact of the COVID-19 pandemic, according to local and regional politicians as well as representatives from the United Nations, the Union for the Mediterranean, and the European Union.

The consensus on the centrality of innovation and the need for change emerged at a meeting on 26 October of the sustainable-development commission of the Euro-Mediterranean Regional and Local Assembly (ARLEM), which brings together members of the European Committee of the Regions (CoR) and local and regional authorities from countries in EU's southern neighbourhood.

The debate will feed into two reports currently being drafted by the president of Andalucía, Juan Manuel Moreno Bonillaand by the president of the Moroccan Mayors' Association, Mohamed Boudra. Their recommendations, which are scheduled for adoption by ARLEM in 2022, will then be considered by the EU and the Union for the Mediterranean.

"The difficult economic situation caused by the COVID-19 pandemic and the measures taken to contain it highlight the limits of globalisation and the crucial importance of the local economy," said Antje Grotheer (DE/PES), Vice-President of Bremen State Parliament, who co-chaired the meeting. "More than ever, young local entrepreneurs need support to develop their activities that meet the needs of local authorities."

Mr Boudra, who is also president of UCLG (United Cities and Local Governments)said that, to cushion the shock of the crisis, there needs to be a diversification of skills in the tourism and travel sector "in order to transform it or to help reorient staff towards less affected economic areas, such as crafts, organic farming, energy-efficient industries and transport or green and sustainable mobility in particular". He recommended a particular focus on digital skills, which would help individuals and help "to make tourism part of a more sustainable and green transition".

Mr Boudra's draft report on "Service sector re-orientation: transferring skills from the tourism sector", which draws on a study commissioned by the CoR, took two countries particularly dependent on tourism – Tunisia and Morocco – as case studies. The co-chair of the meeting – Mina Bouhdoud, Mayor of Lagfifat in Morocco – noted that tourism contributed 12% to the country's GDP and 12.4% of jobs, while Slim Ttatli, former minister of employment and tourism, said that tourism – which accounted for 60%-70% of economic activity in some regions of Tunisia – had fallen by 70% in Tunisia.

Mr Ttatli predicted that the future of tourism in the Mediterranean would be "towards innovation and diversification", noting that in Tunisia, which had developed a flourishing health-tourism industry, there are "serious questions about sustainability", as it is a country poor in energy and water.

Addressing the meeting by video, Natalia Bayona of the World Tourism Organization (UNWTO) noted that tourism had fallen by 75% globally in 2020 and identified five major challenges facing the industry: innovation, education, investments, added valued jobs, and sustainability. "Every single company needs to have an innovative mindset," she said, and an employee needs to be a "lifelong learner".

In his draft opinion on "Innovative ecosystems and start-ups in the Mediterranean region as a means of recovery from the COVID-19 crisis", Juan Manuel Moreno Bonilla, president of Andalucía and member of the Association of European Border Regions (AEBR), includes recommendations in ten areas. These range from updating legislative frameworks, easing access to funding, and investing in entrepreneurial education to fostering collaboration between universities and business, improving evaluation and feedback mechanisms, and investing in infrastructure.

His report, which was presented by José Enrique Millo Rocher, Secretary-General of External Action of the Government of Andalucía, also cites examples of good practice that range widely geographically – from Greece, Morocco, Turkey, Tunisia, and Canada, as well as Spain – and in character. Examples include digital platforms and other forms of multi-disciplinary public-private collaboration, as well as programmes and projects to support smart cities, research and jobseekers. The report also draws attention to the support already provided by regional programmes funded by the EU.

A recurrent theme across the two debates were mismatches in education, skills and the labour market. Giuseppe Provenzano of the Union for the Mediterranean noted that unemployment among graduates is running at 25% in parts of the Mediterranean region, while Mr Boudra's report notes that, in Tunisia and Morocco, almost half of tourism-school graduates opt for jobs outside the industry, mostly due to low salaries. Cesare Onestini of the European Training Foundation, an EU agency, noted that, "despite the increase of education levels in the population, we see a growing skills gap", while Mikel Landabaso Álvarez of the European Commission's Joint Research Centre addressed the challenge of digitisation, noting that 40% of Europeans lack basic computer skills.

The two reports contribute to one of three priority areas for collaboration – sustainable economic development – identified by local and regional authorities on both sides of the Mediterranean. The other two are climate action and women's empowerment.

ARLEM's contribution to promoting sustainable economic development includes an annual award for youth entrepreneurship in the Mediterranean, given in recognition of start-ups that emerge from business ecosystems supported by local or regional authorities. Applications are currently open until 30 November. Applications are welcome from Albania, Algeria, Egypt, Israel, Jordan, Libya, Mauritania, Morocco, Palestine and Tunisia.

The ARLEM commission meeting was followed on 27 October by a workshop on cooperation between cities in the Mediterranean region, co-organised by ARLEM, the Union for the Mediterranean, United Nations Environment Programme / Mediterranean Action Plan, and MedCities.

The position of the CoR on the European Union's "Renewed partnership with the Southern Neighbourhood: A new Agenda for the Mediterranean" is articulated in an opinion adopted in July 2021. The rapporteur was Vincenzo Bianco (IT/PES), a member of ARLEM and of Catania Municipal Council.

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