Agenda 2000: General framework

The structural interventions of the European Union (Structural Funds and Cohesion Fund) are going to be reviewed at the end of the current programme period (1994-1999), although the political priority of economic and social cohesion will be maintained.

Besides all this, on the year 2000 horizon, new events will take place, particularly in the sphere of the European Union (full entry into effect of the Monetary Union and the adhesion of the countries of the East).

Council regulation (EC) No 1260/1999
of 21 June 1999
laying down
general provisions on the Structural Funds

europa.eu.int/comm/agenda2000
europa.eu.int
www.revie.org

In this context of structural interventions, the BCAC and more concretely Gipuzkoa, has obtained during this current programme period (1994-1999) adequate access to community structural funds taking into account the impossibility of accessing financing associated with objective 1 given our GDP (92% of the Community average for BCAC and 94% of the Community average for Gipuzkoa).

The high participation, both in the sphere of the Spanish State and in the whole Union, in procuring resources for objective 2 as well as accessing funds for objectives 3, 4, 5a and 5b and, to a significantly lower degree, accessing Community Initiative and Cohesion Fund resources, has led to an important flow of financial resources into the BCAC as well as into Gipuzkoa.

The characterisation of Gipuzkoa in the context of European regions qualifies it as an area with a high unemployment rate, industrial specialisation and a per capita GDP slightly lower than the Community average. These variables define the structural characteristics of our economy and the central indicators for accessing, in the next programme period, 2000-2006, funding from the Structural Funds.

Table.6.1. The BCAC and Gipuzkoa in the European context

(million ptas.)

INDICATOR

POSITION (BCAC*)

BCAC
(EU RATE 15=100)

Gipuzkoa
(EU RATE 15=100)

Per capita GDP (1994)

110

92

94

Unemployment rate (1995)

197

215

222

Industrial employment (%) (1995)

24

125

145

Population (1994)

59

--

--

Youth unemployment (1995)

196

235

188

(*) Among the 204 European regions (NUTS II)
| euros |

Once the current programme 1994-1999 is finished, a new programme period, 2000-2006, starts. For this new programme there will be important refocusing of the Commission's structural intervention policies.

Agenda 2000 already poses basic guidelines foreseen for the Commission to act upon in said period, as can be seen in the following table.

Table 6.2. Scenario for the period 2000-2006 (Agenda 2000)

1. SLIGHT REDUCTION OF THE AMOUNT OF STRUCTURAL FUNDS
WITH RESPECT TO THE PRECEDING PERIOD

218,400 million Ecus (1999 prices) for the fifteen current member States.

Global transfers (Structural Funds and Cohesion Fund) must not surpass 4% of a member State's current or future GDP.

2. REDUCTION IN THE NUMBER OF OBJECTIVES

Three objectives (two regional and one horizontal destined to human resources) as opposed to the current seven.

3. REDUCTION OF THE PERCENTAGE OF THE POPULATION ELIGIBLE
FOR SUBSIDY FOR OBJECTIVES 1 AND 2 (NEW)

35-40% of the population as opposed to the preceding 51%.

4. THE PRIORITY OF OBJECTIVE 1 IS MAINTAINED

Around 2/3 of the total amount of the Structural Funds

Strict application of the threshold of 75% of the Community GDP. Additional support for regions with high unemployment rates.

5. A NEW OBJECTIVE NUMBER 2

Interventions will be regrouped to favour the other regions that are victims of structural difficulties.

It will include zones in the process of economic change, rural zones that are declining or that depend on fishing or even urban districts with problems.

A limited number of significant zones will be selected to drive an integral strategy of economic diversification, particularly sector-dependent regions.

Possible criteria for eligibility for subsidy: unemployment, industrial employment, agricultural and fishing employment, degree of social exclusion.

6. OBJECTIVE NUMBER 3: MODERNISATION OF THE LABOUR MARKET AND EMPLOYMENT PRIORITY (SYSTEMS OF EDUCATION, TRAINING AND EMPLOYMENT)

The development of human resources as a crucial element.

It will include regions not integrated in objectives 1 and 2.

Four action areas: adjustment to economic and social changes, systems of education and on-going training, active policies against unemployment and struggle against social exclusion.

7. REDUCTION OF COMMUNITY INITIATIVES

Limited to three spheres (as opposed to the current number): cross-border co-operation, rural development and human resources (struggle against inequali-ties in accessing the labour market).

The destined resources could be reduced to 5% of the Structural Funds (as op-posed to the current 9%).

Improvement of innovative actions and pilot projects: concentration on signifi-cant projects and simplified and transparent application (1% of the resources).

8. MAINTENANCE OF THE COHESION FUND

Member States with per capita GDPs lower than 90% of the EU average.

Projects in the sectors of environment and trans-European networks for transportation infrastructure.

Total budget of 3,000 million Ecus.

9. STRUCTURAL SUPPORT FOR NEW MEMBER STATES

Applicability, in principle, to all the countries that adhere.

Gradual increase of the annual aid up to the limit of 4% of the GDP.

Resources around 45,000 million Ecus.

10. IMPROVEMENT OF THE COST-EFFECTIVENESS RATIO

Mid-term view. Economic and social development strategies of an integrated nature.

Simplification of the instruments and improvement of assessment and control.

Source: Developed by Ikei

The basic objective of the Structural Funds has been to maintain economic and social cohesion and it will continue to be so after the adhesion of the new candidate countries, since the per capita income of those countries is only one third the European Union average. Its importance is reflected in the general programmes for underdeveloped regions (objectives 1 and 6), for areas in decline (objective 2), rural zones (objective 5b), the fishing sector (objective 5a). Great efforts are also being expended on employment and industrial reconversion (objectives 3 and 4). The Commission has decided that the efficiency and visibility of the Funds would increase if the seven objectives were reduced to three and proposes that the expenditure in objectives 1 and 2 (which will be redefined to cover areas that need economic and social restructuring) should concentrate on 35-40% of the European Union population in the year 2006 (as opposed to the current 51%).

It has been proposed to assign two thirds of the Structural Funds to objective 1 regions (regions with a per capita gross domestic product lower than 75% of the EU average). Moreover priority is given to programmes destined to improving competitiveness in objective 1 zones and to diversify the economy in objective 2 zones. A new objective 3 is introduced for regions that are not covered by objectives 1 and 2 and that need to adapt and modernise their systems of education, training and employment.

This scenario, in principle, does not look favourable for our territory. The maintenance of the priorities and resources toward objective 1, together with the integration of the new objective 2 of a diverse set of objectives all having to do with boosting economic diversification and the execution of integrated action strategies draw a picture of a reduction in the ability of industry-based, low-per-capita-income regions like BCAC and Gipuzkoa to access community funding.

Nevertheless, our community's high unemployment rate (aggravated by an activity rate which is lower than the Community average), together with productive specialisation in industrial activities with perspectives of low demand and the scarce presence of new companies provide undoubted margin for posing, at least, the stability of European Union structural aid to our territory in the coming pro-gramme period (2000-2006).