Regional aid and CAP shake-up on 18 March agenda

20 February 1998

Regional aid and CAP shake-up on 18 March agenda

THE European Commission is due to unveil a far-reaching review of regional
aid in the European Union (EU) along with a planned shake-up of the Common
Agricultural Policy (CAP) on 18 March.

Deprived areas face a reduction in funding as the Commission discloses a seven-year budget to prepare the EU for enlargement. Regional aid accounts for one third of the Ecu91 billion (£60bn) EU budget.

The Commission wants to freeze spending on regional aid in real terms between 2000 and 2006 at 0.46% of EU gross domestic product (GDP). This amounts to Ecu230bn for existing EU states, with Ecu45bn set aside for new members.

Germany, which contributes the greatest share of monies to the EU budget, says its sick and tired of playing paymaster to the Mediterranean countries.

Monnika Wulf-Mathies, former German trade-union leader turned Brussels commissioner for regional affairs, says its time to wean regions still clamouring for aid. She would like to cut back on various programmes – such as road- and bridge-building and business advice for local companies – and direct funds towards areas of high unemployment.

  • Financial Times 20/02/98 page 2

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