The failure of Mezzogiorno. European Commissioner Mario Monti's reminder of the obligation placed on Member States to respect, even in electoral promises, budgetary discipline (see this section in yesterday's EUROPE) is accompanied by considerations on another fundamental aspect of European activity: regional policy and its effectiveness. Basing himself on the case of Italy's Mezzogiorno, he vigorously disputes the purely "quantitative" theses, stressing that other elements have greater importance tan the volume of money dished out. His observations and claims confirm what we wrote here two weeks ago["We tend to place too much emphasis on the amount of the aid, whereas money alone may be an element of distortion, encouraging organised crime in certain areas, leading to the support of dubious projects with the aim of not losing available funds, etc...Statistics show us that certain areas that have received very large subsidies have not taken off, whereas other have done so with less aid. Other factors than money are likely to have a greater impact." (A Look Behind the News, in our bulletin of 9 February)].
What is it that Professor Monti declared? To summarize, that the development of southern Italy has been a failure, as the gap in relation to the North has remained unchanged for 50 years, and that, in the 90s, Mezzogiorno was the only region of the EU where the gap (in terms of per capita GDP) in relation to the Community average widened. In the 1988-1996 period, the indicator for Ireland went from 64% to 97% of the EU average, Portugal from 61 to 70%, Greece from 58 to 68%, Spain from 62 to 66%. But for Mezzogiorno it dropped from 69 to 67%. This despite the impressive financial contribution of European aid and national interventions. Over and above these figures, we can only be struck by certain observations and analyses. Studies undertaken demonstrate that there is an inverse ratio between development and public intervention. Where subsidies are the highest, development is the lowest: it is concentrated in areas and companies that "have not been privileged by public support". The aid reducing motivation to make an effort. The "factors for development", on the other hand, that Professor Monti cites are:
- the tradition of crafts, where it has not been eroded by the location of subsidy-based installations;
- greater social cohesion and adequate basic education;
- less weight exercised by organised crime. The public authorities have not faced up to their institutional tasks (public order, security, basic infrastructure) whereas they have integrated themselves in the economic process by directly subsidising companies.
Europe's role. These observations lead Mario Monti to emphasise Europe's role. As Commissioner for competition, he logically places emphasis on all forms of State aid. But almost all Community policies could be cited. The reform of the rules relating to public procurement, already prepared by the European Commission, is fundamental, as everyone knows to what extent organised crime has made of this its favourite activty, due to the enormous inflow of cash it comprises. It is difficult to understand the reluctance of some Member States to accept the provision, provided for in the Commission's draft, tending to exclude from public procurement companies compromised in criminal activities. We shall wait to see how the European Parliament will conduct itself on this issue. The management of regional policy has also to take account of the studies and analyses cited by Mr. Monti. The Commissioner responsible for this policy, Michel Barnier, has already expressed his desire that the next period of surveillance planning of the use of resources be strengthened and that the "performance reserve" be increased, i.e., the link between money provided and results achieved.
Even aid to third countries… but these efforts will be useless in regions where organised crime has not been dismantled. As soon as large sums are available, the jackals are there. Should Mr. Monti's intervention lead Europe to grant greater importance to other factors than the sheer volume of aid, it will have proven its use. And this is also valid for certain aid to third countries, totally misappropriated from its objective by corruption and, increasingly, by organised crime.
(F.R.)