On 1 May, the European Union celebrated the 20th anniversary of the biggest enlargement since it was founded, when it welcomed Cyprus, Czechia, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia.
Among the rights and obligations that came with full membership, the A10 countries, as they came to be known, integrated the mechanisms of cohesion policy. The policy spurred economic and social progress, contributing to convergence between the new members and the rest of the bloc.
True to the mission statement enshrined in the 1957 Treaty of Rome, cohesion policy has been instrumental in reducing ‘differences existing between the various regions and the backwardness of the less favoured regions’.
This has been especially true for the 10 countries that joined the EU in 2004: their average GDP at the moment of accession was 60 % of the EU’s average, compared with 80 % today. Similar improvements were recorded in the unemployment rate, which fell from 14.4 % in 2004 to 3.6 % of 2023.
This remarkable catching up process was enabled by factors including direct support to investments from cohesion policy. It has been the key to successful integration into the Single Market.
European Commissioner for Cohesion and Reforms, Elisa Ferreira echoed these achievements on the occasion of the 9th Cohesion Report’s publication when she stated: ‘Over the last 20 years, cohesion policy has succeeded in its mission to promote economic, social and territorial cohesion among regions. For citizens of Member States from the 2004 enlargement, cohesion policy has meant new opportunities, new prosperity and a better quality of life.’
During the 2014-2020 period, annual financial support provided by cohesion policy amounted, on average for the EU-27, to 0.4 % of national GDP. For some beneficiaries, including countries that joined in 2004, it reached more than 2 % of GDP.
Reducing disparities
Cohesion policy, along with other EU financing instruments, is necessary for successful integration into the Single Market. It has reduced disparities, both at EU level and within Member States. Regional disparities in the EU decreased by around 3.5 % thanks to the 2014-2020 funding programmes, while disparities between countries decreased by 2 %.
The impact has been greatest in eastern European countries and less developed regions. In 2023, GDP in the less developed regions was 2.4 % higher than it would have been with no cohesion policy support. For Latvia and Lithuania, the corresponding figures were 4 % and 3 % respectively.
The true nature of upward convergence, as fostered by cohesion policy, emerges in the fact that it is not only regions lagging behind that benefit from EU funds. In fact, cohesion policy also benefits Member States who are net contributors to the policy. This is because investments stimulate demand for their goods and services in the short term. In the long term, the more developed countries benefit from increased imports from less developed regions. It was never aboutabout an ‘aesthetic redistribution of income’ but about the promotion of balanced growth and development, Commissioner Ferreira said at the 9th Cohesion Forum.
How does it look on the ground?
Cohesion policy has supported strong improvements to infrastructure and boosted public services, human capital, innovation and capacity building. These developments have increased the competitiveness and quality of life in the 10 Member States.
There are innumerable projects funded through cohesion policy, in fields ranging from health to transport and energy. Many of these EU-funded projects not only aim at long-lasting and stable growth in less-advantaged regions, but also foster a sustainable one. It is the case of Lithuania where over 5 600 solar-powered lighting systems were installed in households across the country. With around 45 megawatts in installed capacity, Lithuanians save around 27 000 tons of greenhouse gas emissions every year.
Another notable case is the Szeged geothermal system in Hungary. Thanks to cohesion policy, Hungary boasts Europe’s largest geothermal urban heating network. Consisting of 27 wells, 16 heating plants and 250 km of pipes that supply 27 000 households and over 400 public buildings, it eliminates 434 000 tons of greenhouse gas emissions per year.
But cohesion policy support is also crucial in ensuring that communities across Europe have access to efficient public service may they be cutting edge public transport systems - like the brand new Warsaw Metro Line 2, which EU funds supported in the purchase of 17 new trains - ; or health service, like the 41 million € that cohesion policy contributed in developing the Sir Anthony Mamo Oncology Centre in Malta, where patients can now access offers advanced diagnosis and treatment for cancer.
True to its commitment to fostering innovation, cohesion policy also supported Slovenia’s new Biotechnological Hub which provides state-of-the-art facilities for advanced scientific research in fields such as medical biotechnology and agriculture.
Another example of EU-funded project playing off member states’ strongest suit is cohesion policy’s support to e-Estonia. In Europes most digital democracy, this ICT infrastructure lets citizens and businesses have access to a host of digital solutions to access services including healthcare, pay their taxes and vote, an introvert’s dream.
Bringing border regions together with Interreg
Over the past 20 years, cohesion policy has contributed significantly to the elimination of disparities between border regions and their integration into the EU, through European territorial cooperation via the Interreg programme.
Hundreds of joint cooperation projects and partnerships have helped overcome the legacy of the past and build trust and solidarity across borders. This is evident in Interreg support for twin border cities such as Gorizia-Nova Gorica (Italy-Slovenia), Słubice-Frankfurt an der Oder (Poland-Germany) and Cieszyn-Český Těšín (Poland-Czechia). It can also be seen in the development of the European Green Belt along the route of the former Iron Curtain.
Countries acceding to the EU have benefited from transnational Interreg initiatives like the Baltic Sea, Central Europe or Danube Area programmes. These have helped improve socio-economic development and competitiveness by providing access to learning networks and partnerships.
In eastern Europe, productivity (measured as GDP per person employed) grew about three times as fast as the EU average over the past two decades. This is testament to the improved competitiveness and business environments in the eastern regions since they joined the EU.
Looking ahead
The progress made by the A10 countries in the last 20 years speaks volumes on the necessity for cohesion policy. Speaking at the release of the report by the high-level group on the future of cohesion policy, Commissioner Ferreira said Europe could not succeed in an increasingly competitive global economy on the strength of just a few regions. Nor could Europe realise its ambition to be the world’s first carbon-neutral continent if some places did not make the transition.
To remain effective, the policy had to adapt. It had already done so, as seen in the strategic shift from financing basic infrastructure to funding innovation, quality of institutions and green investments. It has enabled rapid response to mitigate the impact of crises such as Covid-19, the Russian invasion of Ukraine and the subsequent energy shortage.
Commissioner Ferreira reminded in multiple occasions that the policy has still room to grow, to modernise, to become simpler and faster, however, in celebrating the 20 years since the last big enlargement, the achievements of cohesion policy are legion and as Ferreira said eloquently in her address at the opening of the 9th Cohesion forum, “Cohesion policy turned hope into action” likely continuing to do so with future enlargements.
