2. EU Cohesion Monitor: a 10-years review

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GEOMETR.IT     ecfr.eu

 

One important change is western EU states’ substantial loss of structural cohesion. Factors that drove cohesion in the east – such as large inflows of EU funding, progressive integration into the single market, and membership of mechanisms of deep integration such as Schengen area and the eurozone – underwent little change in the west.

The potential for them to strengthen cohesion in the west had been realised in earlier periods. The financial crisis damaged the integration process by lowering European countries’ resilience and hampering economic activity – which, in turn, reduced the number of investments that the EU could co-fund in these countries.

The largest declines in structural cohesion between 2007 and 2017 occurred in – in descending order – the Netherlands, Italy, Spain, the UK, Ireland, and Portugal. As there was also a decline in structural cohesion in France during the period, this means that four of the six largest EU member states experienced a trend directly opposed to that in eastern EU states. For example, Poland’s structural cohesion increased substantially during the period.

The other large-scale trend is a north-south divide in individual cohesion. This form of cohesion declined substantially in Europe’s south during the decade – most strongly in Greece and Italy, but also in France and Spain. The divide is particularly significant due to the fact that France, Italy, and Spain also experienced a decline in structural cohesion. Italy’s combined loss of structural and individual cohesion (-1.7 points) is the largest of any EU state. This is remarkable given that the country has traditionally been one of the most committed pro-integration actors in European policymaking.

However, the north-south divide is imperfect. The trend does not apply everywhere in the south, where the financial crisis arguably hit the hardest in heavily indebted countries that suffered from weak governance.

Like Ireland, Portugal incurred serious economic damage during the crisis but its level of individual cohesion has risen in the past decade.

For both countries, this rise related to successful management of the crisis. Individual cohesion rose by 0.1 point for both countries between 2007 and 2014, before increasing by 0.6 point for Ireland and 0.5 point for Portugal in the following three years.

Poland and Hungary also defied the broader trend. Both experienced a 0.4 point decline in individual cohesion during the decade – almost as much as France’s 0.5 point decline. This is in sharp contrast to the significant increase in Poland’s and Hungary’s levels of structural cohesion. In Hungary, the decline in individual cohesion came to a stop after 2014; in Poland, the decline has only been apparent since 2014.

Events of the past decade have broken the cluster the founding six EU member states formed in the cohesion matrix in 2007. At the time, only Luxembourg had far higher levels of structural and individual cohesion than the other founding members. Since then, Italy and France have drifted close to the lower left quadrant of the matrix, while Belgium and Luxembourg have experienced a less dramatic decline in both types of cohesion.

The Netherlands experienced a substantial loss of structural cohesion but, like Germany, an increase in individual cohesion. As a result, Italy’s position on the matrix is now much closer to that of the UK, while Belgium’s and the Netherlands’ positions have moved closer to that of Germany.

All of the seven affluent small member states – highly developed and prosperous countries – have experienced a rise in individual cohesion, with the largest change among them occurring in Sweden (+0.9 point) and the smallest in Denmark (+0.1 point).[5] Among the members of this group, only Sweden has seen an increase in structural cohesion, but all of them have moved up and away from the halfway mark for individual cohesion in the matrix.

In 2007-2017, the Visegrád countries – which in recent years have formed a coalition to veto some EU measures – largely experienced a significant rise in structural cohesion while their levels of individual cohesion stagnated.

However, Slovakia’s level of individual cohesion stagnated at a much higher level than those of the other three members of the group. Hungary, the political spearhead of the veto coalition, registered a larger increase in funding – as measured by the monitor’s indicators – than any other EU country since 2007 (+7.3 points). Financial incentives appear to have had little effect on Budapest’s willingness to cooperate with the wider EU.

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Austria

In the EU Cohesion Monitor matrix, Austria fell from 5th place to 13th place in structural cohesion and rose from 12th place to 10th place in individual cohesion between 2007 and 2017. Austrians’ approval of the European Union grew during this period, as did their experience with the rest of Europe and their support for eurosceptic parties. The largest changes in Austria’s indicators of structural cohesion occurred in Resilience and Economic Ties.

Belgium

Between 2007 and 2017, Belgium fell from 2nd place to 3rd place in individual cohesion and from 2nd place to 7th place in structural cohesion in the EU Cohesion Monitor matrix. It seems that neither the financial crisis nor the refugee crisis had a strong effect on the country’s cohesion. In indicators of structural cohesion, however, the country experienced a decline in Resilience, Security, and Economic Ties. In indicators of individual cohesion, the change was even more profound: Belgium’s Engagement, Experience, and Approval indicators increased, while its citizens’ attitudes towards European integration became more negative.

Bulgaria

Displaying weak structural and individual cohesion in 2007, Bulgaria had by 2017 experienced a major increase in its indicators of structural cohesion (rising from 16th place to 8th place in the EU Cohesion Monitor matrix), mostly because of a massive inflow of funding from EU sources. Yet, at the same time, the country’s economic ties with the rest of the European Union decreased significantly. Bulgaria retained a relatively low level of individual cohesion, moving from 21st place to 20th place in the matrix. Bulgarians’ experience with the rest of Europe remained among the lowest in the EU (comparable to that of Romanians and Hungarians). Bulgaria appears to have the greatest potential to improve its structural cohesion in Security, Economic Ties, and Policy Integration.

* The publication is not an editorial. It reflects solely the point of view and argumentation of the author. The publication is presented in the presentation. Start in the previous issue. The original is available at:    ecfr.eu

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8 Comments

  1. The financial assistance of the Cohesion Fund can be suspended by a Council decision (taken by qualified majority) if a Member State shows excessive public deficit and if it has not resolved the situation or has not taken the appropriate action to do so.

  2. While reducing these gaps will be the top priority for cohesion policy in the future, the whole of the Union will face challenges arising from a likely acceleration in economic restructuring as a result of globalisation, the
    effects of the technological revolution, the development of the knowledge economy and society, an aging population and a growth in immigration.

  3. First, the policy needs to become more concentrated. The major concentration of resources must remain on the poorest regions, with an emphasis on the new
    Member States. In addition, the programmes need to address strategic investments linked to the Lisbon and Göteborg objectives as well as, in the least developed regions, on institutional capacity building. Second, efficiency could be enhanced with improved incentives towards better performance.

  4. Sapala notes that the focus on growth will shift the past “fixation” with how much a region can spend towards strategic planning.

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