Parliament backs special funding measures for rural development in crisis-stricken states

The EU should pay up to 95% of the costs of rural development projects in Greece, Ireland, Portugal, Latvia and Romania to help spur economic recovery by speeding up investment and boosting competitiveness. These higher co-financing rates for states in financial difficulty would be applied on a temporary basis only, until the end of 2013.

MEPs supported this increase in co-financing rates under the European Agricultural Fund for Rural Development (EAFRD) to ensure that these countries, which are  facing cash-flow problems caused by the current, unprecedented, financial crisis that are hitting their growth prospects and drying up public funding, can continue to implement their projects on the ground.

The new rules will only apply until the end of 2013, and will be limited to the period for which the Member States in question are eligible for EU assistance under the European Financial Stabilisation Mechanism (for euro states) or the Balance of Payments Mechanism (for non-euro states).

The overall amount of EU money earmarked for rural development will not change and the temporary measures will not have any impact on the programming period after 2013.

The resolution was passed with 622 votes in favour, 60 against and 17 abstentions.

Next steps

The Council is expected to agree formally to the proposal in the coming days, paving the way for the regulation to be signed by the end of the current plenary session in Strasbourg. The new rules will enter into force as soon as they are published in the EU Official Journal.

Similar arrangements for regional development projects funded from EU structural funds were approved by Parliament on 1 December and are due to be discussed by the Council and signed into law this week.

Procedure: Co-decision (1st reading)