REPORT on the Commission report on the implementation of cross-border cooperation between the Community and countries of Central and Eastern Europe in 1994 (COM(95)0662 - C4-0142/96)

6 November 1996

Committee on Regional Policy
Rapporteur: Mr Jürgen Schröder

By letter of DT(d month yyyy)@DATE@8 February 1996, the Commission submitted to Parliament the report on the implementation of cross-border cooperation between the Community and countries of Central and Eastern Europe in 1994.
A MOTION FOR A RESOLUTION
B EXPLANATORY STATEMENT
OPINION

By letter of DT(d month yyyy)@DATE@8 February 1996, the Commission submitted to Parliament the report on the implementation of cross-border cooperation between the Community and countries of Central and Eastern Europe in 1994.

At the sitting of 11 March 1996 the President of Parliament announced that he had referred the report to the Committee on Regional Policy as the committee responsible and to the DT(d month yyyy)@DATE@Committee on Foreign Affairs, Security and Defence Policy, the Committee on External Economic Relations and the Committee on Budgetary Control for their opinions.

The Committee on Regional Policy appointed Mr Jürgen Schröder rapporteur at its meeting of DT(d month yyyy)@DATE@12 March 1996.

It considered the draft report at its meetings of 7 May, 24 September and 29 October 1996.

At the last meeting it adopted the motion for a resolution unanimously.

The following were present for the vote: Speciale, chairman; Campoy Zueco, vicechairman; Schröder, rapporteur; Azzolini, Berend, Bernardini, Cellai, Frutos Gama, Garosci (for Baggioni, pursuant to Rule 138(2)), Girão Pereira (for Collins), Hatzidakis, Izquierdo Collado (for Howitt), Klaß, Lage, Myller, Novo Belenguer, Podesta, Rack (for Caminson Asensio), Rapkay (for Botz), Rack (for Kellett-Bowman), Schiedermeier (for Langenhagen), Sornosa Martínez, Vallvé, Varela Suanes-Carpegna, Viola (for Rusanen), Walter and Wolf (for Schroedter, pursuant to Rule 138(2)).

The opinion of the COMIT1Committee on External Economic Relations is attachedCOMIT1. The Committee on Foreign Affairs, Security and Defence Policy and the Committee on Budgetary Control decided not to deliver opinions.

The report was tabled on 6 November 1996.

The deadline for tabling amendments will be indicated in the draft agenda for the relevant part-session.

A MOTION FOR A RESOLUTION

Resolution on the Commission report on the implementation of cross-border cooperation between the Community and countries of Central and Eastern Europe in 1994 (COM(95)0662 - C4-0142/96)

The European Parliament,

- having regard to the Commission report on the implementation of cross-border cooperation between the Community and countries of Central and Eastern Europe in 1994 (COM(95)0662 - C4-0142/96)TXTB2@B1@,

- having regard to its resolution of DT(d month yyyy)@DATE@17 April 1996 on the White Paper: 'Preparing the associated countries of Central and Eastern Europe for integration into the internal market of the Union[1],

- having regard to the report of the Committee on Regional Policy and the opinion of the Committee on External Economic Relations (A4-0359/96),

1. Draws attention to the fact that the purpose of the EU-CEEC cross-border cooperation programme is, within the general framework of the Phare programme, to finance structural cross-border cooperation measures intended to:

- further the process of integrating the CEECs;

- boost economic development in border areas, which includes overcoming the problems caused by the recession;

2. Notes that, according to the Commission report, the programme (to which ECU 150 million was allocated) was conducted successfully in 1994;

3. Notes that in 1994 most of the available appropriations were allocated to cross-border projects relating to transport infrastructure, environmental protection and energy supplies and that, during that year, the programme was extended to cover the Baltic States; notes, however, that this served mainly to improve links between existing economic centres, whereas the development plans of the Euro-regions themselves were still not adequately implemented;

4. Also considers that there should be an increase in budget resources for measures to promote interregional cooperation under INTERREG II, both between the regions of the countries of Central and Eastern Europe and between the regions of those countries and the European Union;

5. Notes that, in addition to specific projects involving border countries (Albania/Greece/Italy, Bulgaria/Greece, Poland/Germany, Denmark/Baltic States, etc.), the programme also covers sectoral projects with a crossborder impact (e.g. environmental projects) and multidisciplinary projects (technical assistance);

6. Wishes to see a strengthening of the measures designed to encourage cooperation as regards training, business development and the transfer of technology and marketing skills to small and medium-sized businesses;

7. Emphasizes the political, economic and social importance of EU-CEEC crossborder cooperation, which is a vital instrument of cohesion in the preaccession strategy for the CEECs;

8. Believes that cross-border and inter-regional cooperation measures provide an invaluable learning experience for the countries which have applied for EU membership;

9. Approves, therefore, the general report on the programme in 1994 submitted by the Commission and stresses the need for it to be pursued and strengthened;

10. Believes, nonetheless, that future implementation of the cross-border cooperation programme should be based on:

- a more varied spread of measures within the framework of the existing main subject areas;

- multiannual programming, so as to ensure that the various programmes are more consistent with one another (particularly Interreg and Phare) and to prevent any duplication, in view of the large number of projects involved;

- increased funding for the ECOS/Ouverture programme, which has proved a great success;

11. Calls on the Commission and the Member States to let the Euroregions also have the benefit of the technical assistance and so enable them to develop an effective cross-border management to implement the cross-border programmes;

12. Agrees that, to ensure effective cross-border and interregional cooperation, it is extremely important to achieve a gradual extension of the programmes implemented by the European Union to the countries of Central and Eastern Europe;

13. Stresses the need to coordinate the various programmes implemented by the EU, including the PHARE programme, in order to increase the impact and the effectiveness of the initiatives financed thereunder;

14. Considers it of fundamental importance to establish effective structures to coordinate, monitor and supervise the activities engaged in by way of crossborder cooperation in order to derive maximum benefit from the EU's resources and to prevent possible instances of fraud;

15. Hopes that the Commission will report to Parliament on the results of the various projects and on the way in which they are to be followed up in the future.

16. Calls on the Commission as of now to estimate, with a view to enlargement of the EU, the future cost of pursuing and strengthening the cross-border cooperation programme, and to develop further the existing means of cofinancing by the EIB, the EBRD and the private sector;

17. Considers that bringing the border regions of the CEEC closer to the EU should not result in unbalanced economic development and stresses that economic and social cohesion should be a central objective of the policies pursued by the CEECs and hopes that cross-border cooperation will not be restricted solely to the EU and the CEECs, but will also develop between CEECs, between CEECs and CIS States and, in general, between CEEC regions.

18. While regretting its late publication, approves the Commission report, and affirms its attachment to the pursuit and strengthening of the EU-CEEC cross-border cooperation programme, which is a vital instrument of the preaccession strategy and of economic and social development in Europe;

19. Instructs its President to forward this resolution to the Council and Commission, the parliaments of the Member States and the governments and parliaments of the Central and Eastern European countries.

[1] () OJ C 141, 13.5.1996.

B EXPLANATORY STATEMENT

The Commission has now submitted its report on implementation of the EU-CEEC cross-border cooperation programme in 1994.

The rapporteur will analyse the main features of the programme, the projects implemented, the action taken in 1994, and the manner in which the programme should be pursued and strengthened.

I. Cross-border cooperation: a vital instrument of the pre-accession strategy for the CEECs

1. Objectives

In 1994 an EU-CEEC cross-border cooperation programme worth ECU 150 m (budget heading B7-612) was established within the general framework of the Phare programme, with a view to funding structural measures in regions of Phare beneficiary countries sharing a common border with the EU.

The programme, which is coordinated with measures implemented under the Interreg II programme, has a dual aim:

- to further the integration of the CEECs by means of exchanges of information and experience between the border regions concerned, and by means of joint action;

- to boost economic development in border regions.

The specific objectives of the cross-border cooperation measures are:

- to help such border regions to overcome specific development problems stemming from their relative isolation in the national economy;

- to establish cross-border cooperation networks;

- to safeguard against a collapse in living standards and growth at the EU's external borders;

- gradually to bring the CEECs and the EU closer together.

2. Management of the programme

Pursuant to Regulation (EC) No 1628/94, the Commission administers the aid provided.

Joint programming and monitoring committees (JPMCs) have been established for each border region. These committees constitute the principal means of coordination, since their tasks include both the joint programming of cross-border cooperation activities and the coordination and monitoring of those activities.

The committees are made up of representatives from the Commission, the central authorities and the relevant ministries and agencies.

The following procedure is used:

- the authorities responsible for the programme are appointed by the CEEC governments;

- these authorities then contact those of the relevant EU Member States;

- recommendations are made by the committees and forwarded to the Commission by the CEEC central authorities;

- the Commission submits funding proposals for each border region to the Phare Management Committee, for approval;

- a memorandum of understanding is concluded between the Commission and the CEEC concerned.

Mention should also be made of the ECOS/Ouverture programme, the purpose of which is to promote inter-regional cooperation at both regional and local levels between CEECs and the EU. The programme covers economic and business development, democracy at urban and regional levels, urban service provision, and environmental issues. In 1994, ECU 2 million was allocated with a view to enabling the CEECs partners to participate fully in the programme.

3. Action taken in 1994

(a) Breakdown of expenditure

The overall cost of all the measures funded under the EU-CEEC cross-border cooperation programme was ECU 350 m. The EU's direct contribution stood at ECU 150 m, while the remaining funds were provided by individual EU Member States, CEECs and international financial institutions, and from private and public sources.

As was the case in 1993, infrastructure projects accounted for most of the expenditure (ECU 90 m), followed by environmental projects (ECU 35 m).

(b) General programmes

General cross-border cooperation programmes cover all of the CEECs. In 1994, the Baltic States were also involved in such programmes for the first time.

The Commission report provides a detailed account of all the cross-border cooperation programmes implemented in 1994 (Albania/Greece/Italy, Bulgaria/Greece, etc.).

These included:

- the 1994-1997 sectoral programme, worth ECU 3 m, covering 9 projects in the Baltic States, Poland and Bulgaria;

- the multi-disciplinary programme (ECU 2 m) to finance technical cooperation, training, and investment promotion operations;

- the inter-regional cooperation programme based on the ECOS and Ouverture measures (ECU 1.8 m).

II. Stepping up cross-border and inter-regional cooperation

1. Improving the effectiveness of the cross-border cooperation programme

(a) Appraisal of the report

The Commission states that the 1994 Phare cross-border cooperation programme was a success. Although 1994 was a transitional year, a number of major achievements were recorded. The ECU 150 m allocated by the EP was fully committed by November 1994. The supplementary funding made available for the ECOS/Ouverture programme was allocated to over one hundred inter-regional cooperation projects between regions and cities in the EU and the CEECs.

Lastly, during the year, the programme was extended to cover the Baltic States and Slovakia and Hungary (both of which share a common border with Austria).

It is nonetheless a matter for regret that the report itself, although well documented, was not published until April 1996.

(b) Diversification

Under the Interreg rules, a large number of broad measures may receive support, ranging from reducing administrative barriers to the free movement of goods, persons and services to promoting cooperation in the environmental and health fields and the development of cross-border media.

As was the case in previous years, most of the measures implemented in 1994 fell within the spheres of transport infrastructure (links between Greece and Albania, Bulgaria and Greece, Poland and Germany, etc.), the environment (in particular, clearing up pollution in the Baltic), and energy. Although such measures should remain a priority, they should in future be diversified, with particular attention being paid to economic and social considerations.

In future, cross-border cooperation is to be based on a joint long-term crossborder development strategy. The financing proposals submitted each year will thus be brought within the framework of indicative multiannual programmes.

Along the same lines, it will be necessary to coordinate even more closely not only Interreg and Phare but also, within Interreg itself, the specific programmes between countries sharing a common border and the sectoral and multi-disciplinary programmes, so as to avoid any overlapping and to achieve the highest possible degree of consistency.

Lastly, enlargement of the EU will raise the issue of the funding of cross-border cooperation measures, together with that of cofinancing by the EIB, the EBRD and the private sector.

2. Establishing an overall programme for cross-border and inter-regional cooperation between the EU and the CEECs

(a) A threat to economic and social cohesion

The CEECs have made remarkable efforts to modernize and reorganize their economies, which are now growing steadily, bolstered by an influx of foreign capital (the number of joint ventures tripled between 1991 and 1993). The EU takes in over half of all exports from the associated countries. Immigration from Central and Eastern Europe to EU regions has fallen off sharply since the early transitional years.

Despite this, they remain exposed to the risk of extremely uneven regional development arising from the introduction of a free-market system without, in some cases, adequate controls: regions once dominated by heavy industries which are no longer competitive are now threatened with abandonment; foreign capital tends to be channelled to a disproportionate degree into those countries or regions where there appears to be the least risk. Unless care is taken, there is a danger that major disparities in regional development (over-

concentration/desertification/pollution) will arise, making it even more difficult, in the run-up to the accession of the CEECs, to pursue the goal of economic and social cohesion in Europe.

With a view to guarding against such an eventuality, the CEECs must pursue economic policies geared towards preserving economic and social cohesion. Economic development policy must therefore be refocused. It would be dangerous to concentrate only on areas close to the borders between the EU and the CEECs.

(b) Implementing an overall programme for cross-border and inter-regional cooperation

Efforts will have to be made both during and after the pre-accession period to achieve greater economic and social cohesion throughout the CEECs.

For both the EU and the future applicant countries, economic and social cohesion is the essential precondition for successful economic integration, particularly as far as EMU and the single currency are concerned.

It will therefore be necessary to extend the scope of the cross-border cooperation programme to encompass cross-border cooperation between the CEECs themselves and between CEECs and CIS States, and inter-regional cooperation in general.

OPINION

(Rule 147 of the Rules of Procedure)

for the Committee on Regional Policy

on the report from the Commission on the implementation of cross-border cooperation between the Community and countries of Central and Eastern Europe in 1994 (COM(95) 0662 - C4-0142/96) (Schröder report)

Committee on External Economic Relations

Draftsman: Mrs Concepció Ferrer i Casals

At its meeting of 21 March 1996 the Committee on External Economic Relations appointed Mrs Ferrer i Casals draftsman.

At its meetings of 27 June 1996, 25 July 1996 and 9 October 1996 it considered the draft opinion.

At the last of these meetings it adopted the following conclusions unanimously.

The following were present for the vote: De Clercq, chairman; Sainjon, vicechairman; Ferrer, draftsman; Elchlepp, Imbeni, Kittelmann, E. Mann, Novo, Nussbaumer, Smith, van der Waal (for de Rose) and Wiersma (for Konecny).

I. Introduction

In the context of the pre-accession strategy relating to the countries of Central and Eastern Europe, Parliament considers that cross-border cooperation is a particularly useful way of:

- strengthening 'good neighbour' relations and increasing the degree of trust and the feeling of belonging to a common area,

- creating stable cooperation practices and communication structures as a way of familiarizing the countries of Central and Eastern Europe with the Union's operational methods and speeding up the process of adaptation prior to final accession,

- alleviating the possible isolation of border regions and the economic development problems which may have stemmed from such isolation, and

- encouraging, with due respect for the environment, the development of, inter alia, trans-European transport, telecommunications and energy networks.

With this in mind, Parliament asked for ECU 15 m from the PHARE programme budget to be earmarked for cross-border cooperation between the EU and the countries of Central and Eastern Europe and at least ECU 5 m for those countries themselves. Parliament's request was rewarded by Regulation (EC) No 1628/94 of 4 July 1994 concerning the implementation of a programme for cross-border cooperation between countries in Central and Eastern Europe and Member States of the Community, which is intended to finance structural measures under the INTERREG initiative with a view to stimulating cooperation between the border regions of the PHARE programme beneficiary countries which have a shared border with an EU Member State and between regions in Central and Eastern Europe.

II. The 1994 programme

1. Objectives:

- to prevent a fall in living standards and growth rates at the EU's external borders;

- to contribute to speeding up the transformation process in the countries of Central and Eastern Europe and to bringing those countries and the EU closer together;

- to encourage the creation and development of cooperation networks on either side of the borders and to establish links between those networks and EC networks.

2. Beneficiary areas

Those PHARE programme beneficiary countries which have a common border with the EU: Albania, Bulgaria, the Czech Republic, Estonia, Latvia, Lithuania, Poland and Slovakia (and, following the accession of Austria and Hungary).

3. Areas of activity

Based on the INTERREG guidelines, the measures eligible for funding are mainly designed to:

- remove the administrative and institutional obstacles to the free flow of persons, products or services across borders;

- improve infrastructure, in particular communication facilities and the provision of local water, gas and electricity supplies;

- protect the environment by means of waste management and pollution prevention, with particular reference to problems exacerbated by proximity to external borders;

- promote agricultural and rural development;

- encourage cooperation in health matters;

- promote the development of telecommunications and the establishment of facilities and resources to improve the flow of information between border regions, including radio, television and newspapers;

- promote tourism, trade cooperation, business development, financial cooperation and cooperation between institutions representing the business sector;

- provide investment aid and supporting services and facilities, in particular for technology transfer and marketing for small- and mediumsized businesses;

- trading and employment measures.

III. Implementation of the 1994 programme

1. In practice, given the differing levels of development on either side of the border, Commission activities in 1994 focussed in particular on transport and the environment and, to a lesser extent, on the energy, telecommunications and social sectors.

2. The Commission report on the implementation of cross-border cooperation between the Community and countries of Central and Eastern Europe in 1994 emphasizes the transitional nature of that year since the programme would have to be adapted during the 1995-1999 period to enable it to adopt the multiannual form decided upon at the Essen European Council and to make it more compatible with INTERREG II.

3. Lastly, attention should be drawn to the establishment of cooperation agreements between the associate countries with a view to introducing institutional structures to facilitate the planning and implementation of the activities to be carried out in connection with the programme.

IV. Conclusions

The Committee on External Economic Relations hopes that the Committee on Regional Policy will take the following conclusions into consideration:

1. Stresses the positive results of the PHARE programme for cross-border cooperation in 1994, which are an encouraging indication of the programme's ability to bring the EU and the associate countries of Central and Eastern Europe closer together in the context of a pre-accession strategy;

2. Notes the need to establish multi-annual programmes and to increase the geographical extent of the regions eligible for such programmes; stresses, therefore, that extra budgetary resources should be provided to ensure implementation of such programmes;

3. Also considers that there should be an increase in budget resources for measures to promote interregional cooperation under INTERREG II, both between the regions of the countries of Central and Eastern Europe and between the regions of those countries and the European Union;

4. Generally endorses the Commission's selection as regards the measures adopted under the 1994 programme for cross-border cooperation between the Community and the countries of Central and Eastern Europe;

5. Wishes to see a strengthening of the measures designed to encourage cooperation as regards training, business development and the transfer of technology and marketing skills to small and medium-sized businesses;

6. Agrees that, to ensure effective cross-border and interregional cooperation, it is extremely important to achieve a gradual extension of the programmes implemented by the European Union to the countries of Central and Eastern Europe;

7. Stresses the need to coordinate the various programmes implemented by the EU, including the PHARE programme, in order to increase the impact and the effectiveness of the initiatives financed thereunder;

8. Considers that, to encourage structured dialogue between the regions, there should be a possibility for institutional cooperation within the Committee of the Regions;

9. Considers it of fundamental importance to establish effective structures to coordinate, monitor and supervise the activities engaged in by way of cross-border cooperation in order to derive maximum benefit from the EU's resources and to prevent possible instances of fraud;

10. Hopes that the Commission will report to Parliament on the results of the various projects and on the way in which they are to be followed up in the future.

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