Cohesion policy seeks a new role to remain relevant after 2027
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“Is cohesion policy a policy of growth or redistribution?”. The Next Generation Eu has placed the Europe of the regions at a crossroads and Commissioner Elisa Ferreira, in charge of regional policies of the EU executive, has set up a group of experts who during this year will discuss the future of cohesion, looking beyond 2027.
The panel of twelve experts from the academic world, politics, institutions and civil society will look for a formula to make regions more resilient and modernize cohesion policy, one of the most important in the Union together with agriculture, which absorbs around third of the budget. The largest redistribution policy of the EU, which is characterized by its approach place-based, has in fact been questioned for months now by the so-called Pnrr method, which prefers centralized management of funds conditioned by the implementation of structural reforms. Among the experts who will present their conclusions and recommendations to the Commission at the end of the year are also two Italians: Riccardo Crescenzi, professor of geography at the London School of Economics, and Enrico Rossi, former president of the Tuscany Region.
The thrusts towards the polarization of inequalities
Climate change, green and digital transition, population ageing: faced with these and other challenges that lie ahead, the Europe of the regions appears split in two. On the one hand, the richest regions, generally the most urbanized and dynamic ones, which are already ready to take advantage of the industrial transformation and the creation of new professional figures deriving from the ecological transition. On the other, the poorest who, despite the important European aid they already receive, risk becoming even more marginalized. Climate change will transform entire sectors such as agriculture, while the ecological transition will lead to the abandonment of industries – such as coal – with a centuries-old tradition strongly rooted in the territory also at a cultural level. The demographic decline and the consequent aging of the population – as was underlined during the second of the nine planned meetings – will make access to essential services – such as health care and education – increasingly difficult in rural areas, and given that migrants tend to move to cities rather than rural areas, this phenomenon is not expected to be corrected by migration flows. The data illustrated in the first two meetings of the panel show that the poorest regions will suffer the most negative effects of these transformations. While the opportunities connected to these processes will be seized by regions already oriented towards innovation.
The future of cohesion policy after 2027
The task of combating inequalities and correcting market imbalances has hitherto belonged to cohesion. As for the Pnrr, one of the pillars of the 2021-2027 Partnership Agreement is the green transition, but the cohesion policy currently provides for only one specific instrument to mitigate the adverse effects of the ecological transition, the Just Transition Fund. This fund has both a limited endowment (19 billion in total, of which around one million euros goes to Italy for Sulcis and Taranto) and limited objectives: to compensate those areas where it is estimated that more jobs will be lost. However, as pointed out in the latest OECD report on the manufacturing transition, the negative externalities of the green transition do not only have direct effects, but risk damaging the economy of entire regions. Therefore it would be necessary to conceive the transition within regional development programs that identify new development opportunities for the territory and the training – even low skill – of the workforce. It must also be considered that it is probable that in the next few years we could see an acceleration of these processes, since, as reported by the European Climate Agency to the working group, if the European Union intends to respect the commitments set for 2030 and 2050 related to carbon emissions cuts, the pace will have to more than double the pace.
It is therefore a question of deciding which development model is most suitable for guaranteeing the stability of the regions that are not yet ready to face the transition processes. If up to now the approach has prevailed place based, now that model is called into question by the new tools available. During the first two meetings, various experts from the world of academia praised the method – linked to the achievement of targets and objectives – of the Recovery Fund, indicating it as more suitable for stimulating innovation and growth throughout the territory and safeguarding the social model European. According to Michael Storper – professor of economic sociology at the Sciences Po University – in order to be able to finance redistributive policies as well, and to help the most disadvantaged regions, the EU must focus on technological innovation in order to return to growth.
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