29. PROTOCOL ON ECONOMIC, SOCIAL AND TERRITORIAL COHESION

THE HIGH CONTRACTING PARTIES,

RECALLING that Article I-3 of the Constitution includes the objective of promoting economic, social and territorial cohesion and solidarity between Member States and that the said cohesion figures among the areas of shared competence of the Union listed in Article I-14(2)(c) of the Constitution;

RECALLING that the provisions of Section 3 of Chapter III of Title III of Part III of the Constitution, on economic, social and territorial cohesion as a whole provide the legal basis for consolidating and further developing the Union's action in this field, including the creation of a fund;

RECALLING that Article III-223 of the Constitution envisages setting up a Cohesion Fund;

NOTING that the European Investment Bank is lending large and increasing amounts for the benefit of the poorer regions;

NOTING the desire for greater flexibility in the arrangements for allocations from the Structural Funds;

NOTING the desire for modulation of the levels of Union participation in programmes and projects in certain Member States;

NOTING the proposal to take greater account of the relative prosperity of Member States in the system of own resources,

HAVE AGREED upon the following provisions, which shall be annexed to the Treaty establishing a Constitution for Europe:

Sole article

1. The Member States reaffirm that the promotion of economic, social and territorial cohesion is vital to the full development and enduring success of the Union.

2. The Member States reaffirm their conviction that the Structural Funds should continue to play a considerable part in the achievement of Union objectives in the field of cohesion.

3. The Member States reaffirm their conviction that the European Investment Bank should continue to devote the majority of its resources to the promotion of economic, social and territorial cohesion, and declare their willingness to review the capital needs of the European Investment Bank as soon as this is necessary for that purpose.

4. The Member States agree that the Cohesion Fund shall provide Union financial contributions to projects in the fields of environment and trans-European networks in Member States with a per capita GNP of less than 90 % of the Union average which have a programme leading to the fulfilment of the conditions of economic convergence as set out in Article III-184 of the Constitution.

5. The Member States declare their intention of allowing a greater margin of flexibility in allocating financing from the Structural Funds to specific needs not covered under the present Structural Funds regulations.

6. The Member States declare their willingness to modulate the levels of Union participation in the context of programmes and projects of the Structural Funds, with a view to avoiding excessive increases in budgetary expenditure in the less prosperous Member States.

7. The Member States recognise the need to monitor regularly the progress made towards achieving economic, social and territorial cohesion, and state their willingness to study all necessary measures in this respect.

8. The Member States declare their intention of taking greater account of the contributive capacity of individual Member States in the system of own resources, and of examining means of correcting, for the less prosperous Member States, regressive elements existing in the present own resources system.

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