Brussels, 01/08/2011 (Agence Europe) - On Monday 1st August, the European Commission adopted proposals to amend the current European Union co-funding system in the areas of structural, fisheries and rural development funds. This will benefit six countries experiencing difficulty: Greece, Ireland, Portugal, Romania, Latvia and Hungary. The aim of this sort of “Marshall Plan” is to relaunch the economy. It contains a total of € 2.88 billion in total. Under the proposal, these six countries would be asked to contribute less to projects that they currently co-finance with the European Union for boosting growth and competitiveness.
José Manuel Barroso, president of the European Commission, underlined that the proposed measures provide “an exceptional response to exceptional circumstances”. By accelerating the release of these funds, the Commission is demonstrating its determination to “boost prosperity and competitiveness in the countries mostly hit after the financial crisis”, explained the president of the Commission. He urged the European Parliament and the Council to approve the decision urgently “in order to get money on the ground by early next year”.
On Monday 1st August, during a press conference, Johannes Hahn, European Commissioner for Regional Policy, explained that the Commission thus wants to implement the recent conclusions of the European Council. The commissioner said that the Commission has taken effective measures to tackle the crisis and assist economic growth in the countries that have been hit hardest. The objective is to provide the six countries with an economic boost to help them create new jobs. He indicated that the six countries respected the required criteria for this emergency aid package. The Commission is proposing that the EU contribution be increased to a maximum of 95% during the period of the crisis plan, explained the commissioner. He also explained that they thought that this would help these countries put projects into place that made a difference to the economy. This is a temporary measure, which involves the following funds: European Regional Development Fund (ERDF), Cohesion Funds, the European Social Fund (ESF), the European Fisheries Fund (EFF) and the European Agricultural Fund for Rural Development (EAFRD).
The Commission is not proposing new financial aid but just allows an earlier reimbursement of funds already committed under EU cohesion, rural development and fisheries policy. The EU contribution would be increased to a maximum of 95% if requested by a member state concerned. This should be accompanied by a prioritisation of projects focusing on growth and employment, such as retraining workers, setting up business clusters or investing in transport infrastructure. In this way the level of execution can be raised, absorption capacity increased and extra money injected into the economy faster.
These measures concern member states that have been most affected by the crisis and have received financial support under a programme from the Balance of Payments mechanism for countries not in the euro area (Romania, Latvia and Hungary) or from the European Financial Stabilisation Mechanism for countries in the euro area (Greece, Ireland and Portugal).
The Commission will request that the Council and the European Parliament adopt the proposal in a fast-track legislative procedure by the end of 2011 to allow for the vital projects to get off the ground as soon as possible. The top-up is an exceptional temporary measure, which ends as soon as the member states stop receiving support under the financial assistance programmes.
To help with the absorption of the funds, the Commission is cooperating with the member states concerned to remove bottlenecks, strengthen their administrative capacity and accelerate implementation and spending on the ground. In the specific case of Greece, the Commission has established a task force that will help it to implement the measures foreseen in the economic adjustment programme and take all necessary steps to ensure a quicker take-up of EU funds.
The following is the maximum impact hoped for by introducing the measures proposed by the Commission aiming to cut the level of countries' co-funding for certain projects: - for the six member states, €2.884 billion: €879 million for Greece, €714 million for Rumania, €629 million for Portugal, €308 million for Hungary, €98 million for Ireland and €255 million for Latvia. (L.C./transl.fl)