COMMISSION OF THE EUROPEAN COMMUNITIES 
C0M(91) 400 final 
Brussels, 4 December 1991 
•ém, 
m ANNUAL REPORT 
ON THE IMPLEMENTATION OF THE REFORM 
OF THE STRUCTURAL FUNDS 
1990 
El 
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Executive Summary 
This report is presented pursuant to Article 16 of Regulation (EEC) 
No 2052/88 of 24 June 1988 on the reform of the structural Funds and is 
concerned with implementation of the reform in 1990. 
It is the second of its kind and covers the progress of the measures 
set in train by the Commission and the Member States in 1989 to give 
tangible expression to the political commitments made in the Community 
Support Frameworks. 
In practical terms, the combined efforts have produced a stronger 
partnership, both at the programme preparation stage and during the 
negotiation of their contents with the Commission. 
The year 1990 was decisive for the effective implementation of the 
reform by all the partners as it involved the approval of most of the 
measures provided for in the CSFs. This approval corresponds to the 
legal and financial commitment by the Community, the CSFs themselves 
having been simply a statement of intent. 
As the new rules place emphasis on the need for assessment of 
structural measures, the Commission also launched a series of 
assessment studies in the course of the year. 
International events placed new demands on the Community's structural 
policy. On a proposal by the Commission, the Council admitted the new 
German regions to the overall scheme of structural assistance. 
The purpose of this report is therefore to provide a detailed review of 
the implementation of the CSFs and of coordination between the various 
structural instruments and the other financial instruments, and to 
summarize the first results of the assessment exercises undertaken, 
Additional information will be given in the mid-term review of the 
reform. 
In spite of certain difficulties, the general impression that emerges 
up to now from implementation and the assessment findings is 
encouraging, as regards both the foreseeable impact of the measures and 
the effectiveness of the programming procedures. 
General characteristics of implementation in 1990 
Towards the end of 1989 or, in most cases, in the course of 1990 the 
Member States presented for the Commission's approval draft operational 
programmes or other forms of assistance for new measures on the basis 
of the joint financial commitments and priorities defined by the 
various partners in the CSFs. 
This second phase of the programming process mobilized the regional, 
national and Community partners for many months. 
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In comparison with earlier methods, the new approach to Community 
assistance has significantly reduced the number of dossiers to be 
managed at Community level. This is in line with the principle of 
subsidiarity. On the other hand it has required a change of attitude 
on the part of the authorities responsible for structural policies in 
the Member States with regard to the choice of measures to be 
submitted. These must comply, in terms of their objectives, with the 
priorities laid down in the CSFs. 
When negotiating the content of the programmes the Commission 
maintained its intention to seek greater synergy between the three 
structural Funds. This principle was already reflected in the CSFs, 
which contained priorities common to two or more Funds, and it 
continued to be applied at the decisive stage of programme approval. 
By the end of 1990, thanks to the efforts of all the partners, the 
situation as regards programme approval decisions was satisfactory. 
For the purposes of monitoring the CSFs and the forms of assistance, 
monitoring committees were set up in all the Member States and regions 
concerned in the course of 1990 or early 1991. 
As agreed, the Commission is giving support - particularly by financing 
technical assistance - to Member States' efforts to set up systems for 
monitoring the CSFs and Community funding. 
Some implementing difficulties arose, especially with regard to the 
financial provisions. The Commission has therefore begun to try to 
improve and simplify procedures and in December 1990 it adopted a first 
batch of measures with this end in view. 
In 1990 budget implementation was largely satisfactory. The take-up of 
appropriations for the Objective 1 regions was lower than forecast, but 
in 1989 these regions had enjoyed an implementation rate above the 
forecast level. In any case, the appropriations approved for these 
regions will be carried forward so that commitments made in the CSFs 
are maintained over the five-year period. 
Progress of individual objectives 
Objective 1 concerns seven countries. In all cases except France it Is 
covered by a single CSF. 
Implementation involves a fairly large number of programmes. More than 
300 programmes or other forms of assistance have been approved since 
the start of the reform. 
To date Commission decisions have been taken on almost all the 
measures. 
A lot of work was accomplished in the partnership framework to improve 
programming tools, especially criteria for the selection of projects 
and the quantification of objectives. 
The priorities negotiated at the CSF stage were upheld at the programme 
approval stage. Regional programmes occupy an important place in the 
implementation of Objective 1. But in many cases measures common to 
several regions of a Member State continue to predominate and are 
manaaed at national IAVAI. 
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In 1990 there were no substantial amendments to the CSFs. But it was 
decided to review the initial programming for certain Member States, 
particularly in order to take account of certain investment 
opportunities which had not been foreseen at the negotiation phase, but 
also to improve on original programming. 
information on implementation at operational level in 1989 and 1990 
shows a substantial rate of progress. 
For Objective 2 the year was marked by approval of all the programmes 
required for operational implementation, except for a few RENAVAL and 
RESIDER measures which had not yet been adopted at the end of 1990. 
As the CSFs for Objective 2 are regional, the programmes were presented 
at regional level. 
In most cases programme preparation coincided with preparation of the 
CSFs. The content of the latter was inevitably more detailed than that 
of the Objective 1 CSFs, which gave them a more readily operational 
character. 
As in the case of Objective 1, the partnership initiated at the CSF 
preparation stage continued into the programme planning and monitoring 
phases. 
Objectives 3 and 4 are being implemented through about one hundred 
operational programmes. 
It should be noted that for these objectives 1990 constitutes the first 
year of the application of the reform. 
At the end of 1990 most of the appropriations allocated in the CSFs had 
been approved by Commission decision. 
In terms of content, the forms of assistance correspond fairly closely 
to the priorities and financial breakdowns contained in the CSFs. 
However, the preliminary findings of the monitoring committees indicate 
the need for some changes to the initial programming. 
Available data indicate that take-up of the appropriations for 1990 is 
sat isfactory. 
Under Objective 5(a) a start was made in 1990 with the implementation 
of Regulations 866/90 and 867/90. This will become fully effective in 
1991. 
Implementation of the other horizontal measures under Objective 5a 
(notably Regulation (EEC) 797/85) has continued on the basis of 
legislation revised at the end of 1989 following the reform of the 
Funds. 
Assistance for farm investment as well as compensation payments to 
farmers in upland areas and other less favoured regions remain the most 
important measures. 
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Certain agricultural restructuring measures place particular importance 
on productivity. Following the reform, they have been substantially 
modified in order to achieve a better balance between the priorities 
which the Commission intends to assign to the adaptation agricultural 
structures within the context of the reform of the Common Agricultural 
Policy, namely, improvements in agricultural productivity, adaptation 
of productive potential to market demand, and environmental protection. 
For fisheries, the Commission negotiated and approved specific CSFs 
under Regulation 4042/89. For the Objective 1 countries the original 
CSFs were amended by the inclusion of annexes. 
For Objective 5(b) the Member States presented their operational 
programmes after the approval of the CSFs in June 1990. Some were 
approved before the end of the year, but most of them will have been 
appraised and decided on in the course of 1991. 
Finally, the Commission began application of Council Regulation (EEC) 
No 3575/90 of 4 December 1990 concerning the activities of the 
structural Funds in the new German regions. After submission of the 
development plans in December 1990 and negotiations with the German 
government and the Lender, the Commission approved the CSFs on 13 March 
1991. 
In addition to the measures part-financed under the CSFs, Community 
support for regional development and greater cohesion to help the less-
favoured regions is provided through Community initiatives. 
Implementation of these began with the submission of projects under the 
initiatives approved in 1989 (RECHAR, ENVI REG, STRIDE, INTERREG and 
REGIS). 
In 1990 the Commission introduced a new series of initiatives which are 
based on three priorities: 
strengthening of human resources (EUR0F0RM, HORIZON, NOW); 
integration of rural areas (LEADER); 
extension of certain basic infrastructure (PRISMA, REGEN, 
TELEMATIQUE). 
But very few programmes had been formally adopted before the end of 
1990. Most of the decisions will be taken in the course of the 
fol lowing year. 
Initial assessment of implementation 
Certain lessons may be learnt from the first two full years of 
implementation. 
At the operational level, the Commission and the Member States have 
managed to translate into practical form the commitments made in the 
course of CSF negotiations in 1989. 
In this respect 1990 was a year of significant progress. Almost all 
the forms of assistance were approved and the corresponding financial 
commitments made. 
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From the point of view of monitoring, several Member States amended 
their domestic legislation to provide a statutory basis for the 
monitoring committees. 
Regular monitoring of the CSFs and the programmes gives the Commission 
and the Member States data with which to identify and correct any 
programming mistakes which could impede proper implementation. 
In addition the mixing of loans and grants began to take practical 
effect. The availability of loans under the CSFs was taken up by 
numerous Member States. The EIB is now helping to finance measures 
implemented under the CSFs and this is undoubtedly a step forward. 
This is especially true in the Objective 1 regions. However, the 
coordination of measures is hampered by the difficulty of joint 
programming of the two types of instrument. 
The first findings concerning the impact of the structural measures all 
indicate that although the contribution of the structural Funds to the 
Community's GDP remains small, it is proportionately greater in the 
least prosperous regions which receive the bulk of the assistance. 
There is every reason to believe that the macroeconomic impact in these 
regions will be significant in terms of growth and job creation. 
Evaluation also includes qualitative analysis of the basic principles 
of the reform. 
All the findings suggest that multiannual programming is now generally 
accepted as a method of choice for managing structural assistance. In 
this respect the CSFs represent a major advance on the past. 
Furthermore, the role of the regions has been increased at field level, 
even in cases where their involvement at the CSF preparation phase was 
regarded as inadequate. Thus, partnership in practice has been 
established. 
These achievements no longer seem in question. 
But, alongside the positive aspects, there are some less encouraging 
points to note. 
Verification of the additionality of Community assistance is 
continuing, but things are not entirely satisfactory in this respect. 
The Community has stepped up its dialogue with the Member States in 
order to ensure that they comply with the obligations placed on them by 
the framework legislation. 
As regards procedures, criticisms have been voiced by several partners. 
Within the framework of the present rules, the Commission has taken 
certain steps to try and improve procedures. 
Further simplification is under consideration. 

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CONTENTS 
INTRODUCTION 
CHAPTER 1 : Main Features of Implementation 
.1. Approval of the forms of assistance 
.1.1. Approval of the forms of assistance for CSFs decided on in 
1989 and 1990 
.1.2. The number of forms of assistance approved 
.1.3. Approval of the forms of assistance required to implement 
Community initiatives 
.1.4. Synergy between Funds 
2.1. Assessment of the implementation of the basic principles of 
the Reform 
2.1.1. Concentration 
2.1.2. Programming of assistance 
2.1.3. Partnership 
2.1.4. Verification of additionality 
3.1. Monitoring of the CSF's and forms of assistance 
3.1.1. The Monitoring Committees 
3.1.2. The preparation of systems for monitoring forms of assistance 
4.1. The need for greater simplification of procedures 
4.1.1. Greater flexibility 
4.1.2. Improved financial provisions and channels 
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CHAPTER 2 : IMPLEMENTATION OF OBJECTIVE 1 
1.1. General overview 
1.1.1. Difficulties encountered 
1.1.2. Multifund approach under Objective 1 
1.1.3. Analysis of the forms of assistance by Member State 
1.1.4. The results of implementation as regards appropriations 
approved 
1.2. Implementation of the CSFs by Member State 
1.2.1. General analysis 
1.2.2. Measurement of the overall socio-conomic impact of structural 
assistance 
1.2.3. Greece 
1.2.4. Spain 
1.2.5. France 
1.2.6. Ireland 
1.2.7. Italy 
1.2.8. Portugal 
1.2.9. United Kingdom 
CHAPTER 3 : IMPLEMENTATION OF THE OTHER OBJECTIVES 
1. Object ive 2 
1.1. General overview 
1.1.1. Difficulties encountered by the Member States 
1.1.2. The multifund approach 
1.1.3. Results of implementation in terms of appropriations mobilized 
1.2. Implementation of the priorities 
1.2.1. General 
1.2.2. Changes noted at the monitoring stage 
1.3. Assessment of the Community Support Frameworks 
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2. Objectives 3 and 4 outside the Objective 1 regions 
2.1. General overview 
2.1.1. Forms of assistance 
2.1.2. Monitoring Committees 
2.2. Implementation in terms of appropriations mobilized 
2.3. Main types of measure 
2.4. Initial results of assessment of the CSFs 
3. Object ive 5a 
3.1. Adaptation of structures for the production and marketing of 
agricultural and forest products. 
3.1.1. Preparation of the sectoral plans and the CSFs on marketing 
and processing structures 
3.1.2. Implementation of the Regulations 
3.1.3. Utilization of the measures 
3.2. Implementation of the Regulation on improving the marketing 
and processing of fishery products. 
3.2.1. Partnership 
3.2.2. Preparation of financing plans and breakdown of appropriations 
among Member States 
4. Object ive 5b 
4.1. The priorities laid down in the CSFs 
4.1.1. General Guidelines 
4.1.2. The role of each Fund in the priorities 
4.2. Progress 
4.2.1. The forms of assistance submitted 
4.2.2. Approval of the forms of assistance 
4.3. First results of assessment 
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CHAPTER 4 : COMMUNITY INITIATIVES AND INNOVATIVE MEASURES 
1. Community initiatives 
1.1. New initiatives approved in 1990 
1.2. Implementation of the Community initiatives 
2. Innovative measures and pilot projects 
2.1. Measures to promote Community regional development (Article 10 
of Regulation (EEC) N' 4254/88 on the ERDF) 
2.2. Pilot schemes for rural development (Article 8 of Regulation 
(EEC) N'4256/88) 
2.3. Innovative schemes for the development of employment (Article 
1(2) of Regulation (EEC) N'4255/88 
CHAPTER 5 : INTEGRATION OF GERMAN REGIONS AFTER UNIFICATION 
CHAPTER 6 : THE CONTRIBUTION OF THE LOAN INSTRUMENTS 
1. Principles 
2. Practice 
3. Assessment and outlook 
2.1. The ElBs contribution 
2.1.1. Concentration 
2.1.2. Links to the CSFs 
2.1.3. Project characteristics 
2.1.4. Complementary and Joint action 
2.1.5. Constraints on the absorption of EIB loans 
2.1.6. Programming and evaluation 
2.2. ECSC lending 
2.2.1. Programming 
2.2.2. Trends in lending 
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CHAPTER 7 : BUDGET IMPLEMENTATION IN 1990 
7.1. Concentration of ERDF resources 
7.2. Budget implementation in 1990 
7.2.1. Budget implementation by objective 
7.2.2. Allocation of budget appropriations and outturn in 1990 (by 
Fund) 
ANNEXES 

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INTRODUCTION 
During 1990 considerable progress was made in implementing the reform 
of the structural Funds. 
The Commission approved a large number of programmes in order to give 
concrete financial expression to the political undertakings enshrined 
in the Community Support Frameworks (CSFs). 
in the cases of Objectives 1, 2, 3 and 4, for which the CSFs were 
approved in 1989 (see first Annual Report), the process entailed 
implementing the general guidelines laid down in the CSFs by approving 
the forms of assistance referred to in Article 5 of the framework 
Regulation. This created the legal basis for commitment of the 
appropriations provided for in the CSFs. 
In the case of Objective 5(b), for which 44 CSFs were approved in June 
1990, implementation during the year was limited. Most of the 
programmes were expected to be approved in the first half of 1991. 
An important innovation in the case of Objective 5(a) was the 
obligation on Member States to submit sectoral plans under Regulations 
Nos 866/90, 867/90 and 4042/89 (improving the processing and marketing 
conditions for agricultural, forestry and fisheries products). 
The Commission continued its work on the promotion of new Community 
initiatives in order to deal with the most sensitive development 
problems. 
The Community gave support to German unification by extending the 
structural Funds to the five new Lender. It had the task of 
implementing Council Regulation (EEC) No 3575/90 of 17 December 1990 
concerning the activities of the structural Funds in the territory of 
the former German Democratic Republic. 
The Commission made a decisive start on assessing structural policies 
by launching a first series of studies for which it was itself 
responsible. The systematic assessment of the Objective 1 CSFs, of a 
representative sample of those for Objectives 2 and 5(b) and of those 
for Objectives 3 and 4 also began in 1990. In addition, evaluation 
studies of Objective 5a measures have been undertaken in order to 
assess their impact on Community agricultural structures, as well as a 
study of the implementation of assistance to young farmers in the 
various Member States. These studies will continue in 1991. 
During the two years of its implementation, the Commission has 
reaffirmed its continuing confidence in the validity of the principles 
underlying the 1988 reform and the relevance of their continued 
applicat ion. 
The following chapters review the concrete achievements of 1990 and 
offer an initial assessment of the progress made. 
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CHAPTER 1 MAIN FEATURES OF IMPLEMENTATION 
During 1990 the Commission concentrated on the following four fields: 
approval of the forms of assistance; 
ex-ante assessment pursuant to Article 26 of the coordinating 
Régulât ion; 
monitoring of the CSFs and approved programmes; 
simplification of procedures. 
1*1 Approva. I of forms, gtJUSialftasa. 
1-1.1 Approval of forms of assistance for _Ç$F§_ dsc]dejipn. J.n JLSS9. and 
As stated in Article 10 of Regulation (EEC) No 4253/88 (the 
coordinating Regulation), the CSFs are a declaration of intent. They 
are contracts negotiated between the Commission and the Member State in 
partnership, and are not enough in themselves to allow commitment of 
the Community appropriations obtained following the doubling of the 
Funds. 
The main priority in 1990 was for the Member States to submit and the 
Commission to approve the applications for assistance which provide a 
basis for the operational implementation of the general guidelines laid 
down in the CSFs. 
These new measures were additional to those existing before the reform, 
some of which have been incorporated in the CSFs. 
1 • 1 •2 The number of forms of assistance aj)pxgy!©d 
Over the two years of implementation of the reform, the Commission has 
approved as new measures 545 forms of assistance (303 unrier Objective 
1, 138 under Objective 2, 99 under Objectives 3 and 4 and five under 
Objective 5(b))<1). 
In the first place, it should be noted that the change from a system of 
project-based assistance to operational programmes has meant in 
practice that substantially fewer dossiers have to be monitored than 
before. 
Secondly, Objective 2 is being implemented through a fairly iirge 
number of programmes, mainly as a result of its regionalized nature (54 
CSFs approved). 
In the case of Objective 5(b), the figures are not representative 
because roost of the measures will be approved in 1991. 
In accordance with the rules, operational programmes are the 
predominant form of assistance. 
Before the reform, the programme technique was not widely used so the 
systematic programming of assistance represented a change for the 
Member States and for the Commission. 
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The Member States have made little use of the global grant technique. 
The problems surrounding its use referred to in the previous report 
continued in 1990 but the Commission is continuing to express interest 
in this form of assistance and more encouragement for its use should be 
given in the future. 
Naturally, with some exceptions, projects continue to be covered by 
separate commitment decisions. But, whereas this form of assistance 
accounted for 80% of ERDF commitments before the reform, in 1990 it 
accounted for only 13%. 
Aid schemes are normally included in operational programmes. In 
addition to the new measures described above, the Commission approved 
23 ERDF programmes under the old rules, mainly Community programmes 
under RESIDER and RENAVAL. Most of these concern areas eligible under 
Object ive 2. 
The bulk of assistance for the agricultural aspects of the CSFs is 
provided through operational programmes. 
Of the 83 OPs to which the EAGGF was expected to contribute under 
Objective 1, three were approved in 1989 and a total of 72 had been 
approved by the end of 1990. Those approved cover all agricultural 
assistance under the CSFs for Greece, Ireland, Northern Ireland and 
France. Some operational programmes in Spain(7), and in Portugal(2) 
and the regional section in Italy had still to be approved in 1991. 
Details of the forms of assistance for Objective 5(b) will be given 
subsequent I y. 
The ESF had approved 341 forms of assistance by 31 December 1990 of 
which 173 were for Objective 1 and 99 for Objectives 3 and 4. 
The approved OPs cover almost all the ESF assistance provided for in 
the Objective 1 CSFs and in those relating to Objectives 2, 3 and 4. 
As noted above, implementation of Objective 5(b) is continuing in 1991. 
1.1.3 Approval of the forms of assistance required to Implement 
Community initiatives 
Since the first decisions were not finalized until 1990 and 1991, most 
of the operational programmes required to implement these initiatives 
were submitted in 1991. 
Accordingly, only one RECHAR programme, for a French Objective 2 area, 
could be approved in 1990. 
All the remaining 25 RECHAR programmes and the applications under other 
Community initiatives approved in 1989 (7 ENVIREG programmes, 12 STRIDE 
programmes, 3 REGIS programmes and 1 INTERREG programme) were under 
consideration at the end of 1990. 
The decisions concerning the Community initiatives on human resources 
(HORIZON, NOW and EUROFORM) and rural development (LEADER) came at too 
late a date for the Member States to submit any applications in 1990. 
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1.1.4. Synarqy between Funds 
One of the basic principles of the reform which was sought during 
negotiations over the CSFs was synergy between the Funds in order to 
make the assistance more effective. 
Naturally, the success of this approach, as negotiated in 1989 and 
reflected in the CSF priorities, will be measured as and when the forms 
of assistance are implemented. 
During negotiations with the Member States on the content of the OPs, 
the Commission sought, in accordance with Article 14 of the 
coordinating Regulation, to promote multifund OPs wherever these were 
acceptable to the partners. Such programmes represent one of the ways 
of implementing the integrated approach negotiated in the CSFs. 
A total of 76 multifund programmes were approved by the Commission up 
to the end of 1990 in order to implement Objectives 1, 2 and 5(b). 
(i) In the case of Objective 1, the multifund approach covers a number 
of programmes with total assistance granted amounting to around 
ECU 9.5 biI I ion. 
In some countries, the Commission had negotiated the assistance 
to be implemented through the integrated approach when the CSF 
was prepared. Elsewhere the forms of assistance were selected 
after definition of the CSF through negotiations which were in 
some cases quite long and difficult. 
(ii) In the case of Objective 2, the integrated approach was used 
for around 9% of the programmes approved with total assistance 
amounting to about ECU 690 million. 
Since the Objective 2 CSFs cover limited areas and include ERDF 
and ESF measures for the same development priorities, priority 
in implementation should be given to integration between 
training and other measures. 
(iii) An integrated approach is used in the Objective 5(b) areas and 
it is expected that up to 90% of the assistance adopted under 
this Objective will be in the form of multifund programmes. 
The integrated approach is the logical consequence of the rural 
development policy objective. 
Use of the integrated approach made considerable demands on the 
Commission, whose staff had to reconcile the need to commit 
appropriations as soon as possible with the longer appraisal times 
inherent in this approach. 
In general, the integrated approach has enabled the Funds to act in a 
more coordinated and mutually beneficial manner. However, development 
of the desired synergy between the Funds may be hindered by 
administrative structures and allocations of responsibility at national 
and Community level which are designed for a purely sectoral approach. 
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Efforts to develop the multifund approach must therefore continue. The 
Commission has already stated that it will use it more systematically 
in the second phase of Objective 2 (1992-93), which will involve 
preparation of new CSFs and approval of the corresponding forms of 
assistance. Furthermore, it is continuing its efforts to increase the 
synergy between measures in certain programmes which have already been 
approved, mainly through the assessment procedure, which may result in 
some adjustments in the course of implementation (1989-93). The 
monitoring arrangements (chiefly the Monitoring Committees) also 
provide an opportunity for achieving greater synergies. 
2.1 Assessment of the Implementation of the basic principles of the 
Reform 
In accordance with the spirit of the Regulations, assessment must take 
its place alongside the main principles of the reform as an important 
aspect of Community structural assistance to the Member States. In 
particular, ex-ante and ex-post evaluation permit the impact of 
Community action to be measured in terms of the priorities of the 
reform and give expression to the principle of transparency which 
should underlie all Community assistance to the Member States. 
Under the heading of technical assistance the Commission has provided 
the Member States with resources to extend their assessment capacity 
and it has added to its own expertise by calling on the services of 
independent assessors. 
Assessment involves a wide variety of tasks at various stages of 
implementation, ranging from evaluation of the CSFs and certain forms 
of assistance or Community initiatives to thematic or horizontal 
assessments which, at Community level, provide an overview of the 
degree of convergence of the policies achieved in a given sector and, 
at national level, facilitate the adjustment of the strategic 
objectives of the Member States in the sector in question. 
This report presents only the findings of the assessment of the CSFs, 
since the remainder of the work is less advanced. The assessment 
studies were designed and launched by the Commission and now cover all 
the CSFs for Objectives 1 (seven countries), 3 and 4 (nine countries), 
15 of the Objective 2 areas and 11 of those eligible under Objective 
5(b). 
The assessments of the CSFs have two aims. The first, more 
conventional, aim is to evaluate the socio-economic impact of the CSF 
on the specific objective(s) for which it was introduced. The second 
relates to the mechanisms of implementation of the CSFs and seeks to 
measure the efficiency introduced by the reform and its main underlying 
pr inciples. 
Assessment of the socio-economic impact is forward-looking and seeks to 
measure the expected impact of correct implementation of the CSFs. It 
will be undertaken when the problems specific to each Objective are 
covered. As regards the assessment of the basic principles, the 
approach relies primarily on interviews, opinion surveys and inquiries 
in the areas concerned. It is seeking to concentrate on an initial 
assessment of the practical implementation of the major principles of 
the reform. 
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Despite the wide variety of national and regional situations, one 
initial conclusion seems to be that there is a generally favourable 
view of Implementation, irrespective of the Objective being considered. 
The reform of the structural Funds is widely regarded as representing 
definite progress over the methods of assistance used in the past. 
Multiannual programming, concentration, partnership and additionality 
constitute, in the views of those involved and of observers, important 
gains which should be preserved and consolidated. 
Certain Member States have required some time to become accustomed to 
the novelty of the approach, a process which the Commission has 
endeavoured to assist. More generally, impiementation of the reform 
has led to requests for the simplification of procedures. The 
Commission began to introduce these at the end of 1990. 
On the basis of both the assessment reports and the lessons learned 
from a year of actually implementing the reform, the sections below 
will look in turn at each of the major principles. Since the CSFs for 
Objectives 3, 4 and 5(b) were adopted later, which has delayed 
assessment somewhat, the examples given relate principally to the CSFs 
for Objectives 1 and 2. 
2.1.1 Concentration 
The principle of concentrating Community assistance on the countries 
and regions with the greatest development and conversion problems and 
on certain priority sectors of the economy may be regarded as one of 
the determining factors for economic and social cohesion. It is an 
established principle. 
Application of the principle in the field involved the selection of 
geographical areas according to objective Community criteria. Broadly 
speaking, this produced a geographical division acceptable to ali the 
parties involved. 
There appear to be two key factors in determining an appropriate 
definition of Objective 2 areas: 
implementation of the CSF is more effective where the area 
corresponds to an existing administrative unit; 
an economically homogeneous area ensures that local problems are 
effectively taken into account in the operational programmes. 
The experience of assessment tends to suggest that a lack of 
balance between these two factors is a source of potential problems 
and inefficient implementation of the reform. 
The concentration of available financial resources in the selected 
areas is the second aspect of this principle. Naturally, whatever the 
objectives, the funds always fall short of the needs expressed, so the 
amounts set out in the plans submitted by the authorities are often 
reduced. This approach has sometimes been regarded as undermining the 
programming effort, which had resulted in a carefully balanced estimate 
of the resources required for the various priorities. 
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The third aspect of the principle was concentration on a limited range 
of priorities. The Community Support Frameworks prepared by the 
Commission and discussed with the Member States represent a clear 
departure from the approach previously adopted. For example, the 
amount of assistance for infrastructure in the Objective 2 area is 
considerably lower, so permitting greater concentration on measures to 
create or retain Jobs. 
2.1.2 Programming Qf assistance. 
There is no doubt that the programming approach is one of the major 
achievements of the reform. 
Widely regarded as an excellent formula, the programming exercise was 
somewhat thwarted by the very short time available for the drawing-up 
of regional development plans or strategies, by the lack of experience 
of certain Member States in seeking coherence, by the lack or paucity 
of economic and statistical indicators on which to base forward 
analyses and by the fact that little use was made of the techniques of 
ex-ante evaluation, whose methodology was rarely mastered effectively. 
Despite these problems, programming was seen as a significant 
improvement on the practical side of Community assistance and induced 
an effort of strategic thinking on the questions of development, 
conversion and employment. 
However, assessment has revealed certain factors which affect the 
quality of programming: 
the first is undoubtedly the need to base the strategic development 
of a region on discussions with all those involved in its economy. 
This approach ensures both that the strategy is soundly based and 
that it is implemented successfully-, 
the second concerns estimating the time required for this strategic 
approach based on consensus to be put into practice. It is clear 
that when the reform was first implemented only those regions with 
experience of programming were able to draw up measures based on a 
development strategy acceptable to local agents. 
However, although pre-existing programming in certain Member States is 
undoubtedly an advantage, it can also restrict the scope for Community 
assistance to the extent that the measures have already been defined 
between the regions and the central government, without the 
Commission's intervention. 
Similarly, the programming process benefited considerably where 
regional administrations had had experience of integrated programming 
before the reform (IMP, I DO, non-quota, NPCI, etc.). This confirms the 
impression that the results of "learning by doing" are of value in 
later stages of development. 
The three-year programming period for Objective 2 was generally 
regarded as incompatible with implementation of a real industrial 
conversion programme. By its decision in 1991 to extend unchanged for 
1992 and 1993 the list of areas eligible under this Objective, the 
Commission has already responded in part to this point. 
- 8 -
Finally, particularly in the case of certain Objective 1 countries, the 
Community adjustments made to the plans submitted by the Member States 
and then translated into the CSFs are not always reflected in the 
overall picture of supplementary national public investment. 
2.1.3. Partnership 
Like multiannual programming, partnership is unanimously regarded as 
one of the strengths of the reform. The hopes raised by this principle 
have, however, been tempered by its application in practice since its 
definition and implementation have, for institutional reasons in 
particular, varied depending on the Member State, especially where the 
preparation of CSFs is concerned. 
The weight of the three partners (Commission, national government and 
the regions) often seems out of proportion to that of local partners, 
who are nevertheless involved both in part-financing and management. 
This may be a cause of inefficiency if it impedes the mobilization of 
national resources to match Community funds. 
On-the-spot observation reveals considerable differences between 
partnership in programming and partnership in the management of 
implementation. The two forms of partnership often bring together 
different partners, each with its own motivation, expertise and working 
methods. The results are of higher quality when partners are involved 
in both funct ions. 
All the national authorities set up a consultation process for 
preparing the plans and this was of course easier where working 
relations existed already. An obstacle arose in certain countries 
where the central government predominantly exercises authority and can 
impose its view of development strategy on the regions. 
Partnership is now in operation virtually everywhere in the monitoring 
committees for the CSF and OPs. On the basis of this recent 
experience, reactions are generally positive and expectations of 
improvement all concern a redefinition of the role of the regions, 
ranging from the programming process to the management of the measures 
themselves. Many partners have said they would appreciate the 
availability of qualified expert assistance and support structures. 
2.1.4. Verification of add ItionalIty 
Under the principle of additionality, Member States which receive 
transfers from the structural Funds to achieve the objectives of the 
reform are required not to reduce their own expenditure for that 
purpose. The principle is established in Article 9 of the framework 
Regulation and its verification at regular intervals during 
implementation of the CSFs is the responsibility of the Commission. 
Accordingly, compliance with this principle has been assessed during 
the course of 1990. In August the Commission requested the Member 
States to provide the information required (using a standard 
explanatory format) before 30 November 1990. This deadline was not 
generally respected. Most of the Member States asked for more time 
and/or questioned the validity of the Commission's request, invoking 
technical problems relating to the difficulty of providing a breakdown 
of statistical and budgetary data. In view of the difficulties 
- 9 -
encountered by the Member States, the Commission decided to send 
letters to each of them asking for a reply by 15 May 1991 and proposing 
bilateral meetings to look at specific problems. These have been held 
with certain Member States, sometimes coinciding with meetings of the 
Monitoring Committees. As a result of the meetings, several Member 
States have supplied or are in the process of supplying the desired 
informat ion. 
The Commission is now assessing addit ional ity on the basis of this 
information. This initial assessment is regarded as ex-ante because 
the figures concern expenditure planned or anticipated for the period 
of the CSF (in total or at least for 1991, 1992 and 1993). However, 
some Member States have also provided details of expenditure actually 
carried out in 1989 and 1990 as well as in the base year of 1988 and 
this will permit on-going verification that the principle of 
additionality has been respected. Obviously, checks on compliance with 
this principle have to be carried out regularly, as stated in the 
standard clauses of the CSFs, and will be completed after the CSF has 
been fully implemented. 
So far, the figures received by the Commission and contacts with the 
Member States through the partnership suggest that additionality is 
being respected in Ireland, Portugal and Greece (Objective 1) and 
Germany and Belgium (Objective 2). Spain has presented a study on the 
verification of additionality for the period 1988-90 using a 
methodology different from that laid down by the Commission; the 
Spanish authorities consider that Spain has complied with the 
additionality requirements. in other cases no conclusions can be 
drawn, mainly because of the lack of information from the Member 
States. The situation varies depending on both the Member State and 
the Objective. As regards the United Kingdom, it is difficult to 
determine additionality at the regional level on the basis of the 
present system of public expenditure allocation. Bilateral contacts on 
this are continuing. Italy is currently preparing data for the base 
year of 1988. 
This situation cannot be regarded as satisfactory. While it is true 
that the practical verification of additionality may encounter 
technical difficulties concerning availability of the statistics 
needed, in general the Member States have been dilatory in giving this 
matter the importance it deserves and which the Regulations require. 
Sometimes, the technical difficulties adduced by the Member States are 
difficult to understand, particularly in the case of regions with a 
tradition of receiving assistance, such as the Mezzogiorno. It should 
also be noted that the Commission has always been prepared to assist 
the Member States to overcome difficulties of this type. 
The Commission hopes that the situation will improve in the near future 
so that the terms of Article 9 of Regulation (EEC) n* 4253/88 (the co­
ordinating Regulation) are respected. 
- 10 -
3.1 Monitoring of the CSFs and forms of assistance 
The decentralized management of the structural Funds which is now a 
consequence of the programme approach means that monitoring must be 
strengthened. 
This has two main aspects: 
setting up of the Monitoring Committees provided for in Article 25 
of the coordinating Regulation; 
establishment of monitoring systems in the Member States to provide 
effective monitoring of implementation of the reform. 
3.1.1 The Monitoring Committees 
3.1.1.1 Setting UP of the Monitoring Committees 
During 1990 the Commission set up the Monitoring Committees in liaison 
with each Member State and region concerned. The duties of these 
Committees are defined by the Commission in agreement with the Member 
State. The Commission is automatically a member and the EIB is an 
associate member. 
In the case of Objective 1, there Is a single CSF for each of the 
countries concerned apart from France, where the CSFs were prepared on 
a regional basis. In most countries Monitoring Committees at regional 
level, as well as a national Monitoring Committee, have also been 
required. 
All the Objective 1 Monitoring Committees were set up in 1990, although 
in some Member States the delays in establishing them prevented them 
from doing detailed work. It should be noted that the main usefulness 
of a Monitoring Committee is directly dependent on the existence of 
approved forms of assistance. Since in some countries programmes were 
not decided until the end of 1990, the Member States did not consider 
it necessary to convene meetings of the Committees. 
The regionalized nature of the Objective 2 CSFs meant that virtually 
all the Monitoring Committees were established at regional level. This 
process took place satisfactorily and quite rapidly, facilitated by the 
more operational nature of the CSFs for this Objective. 
Although there is only one CSF per Member State for Objectives 3 and 4, 
monitoring is carried out both nationally and, in some countries, at 
regional level. 
Because of the late approval of the CSFs for Objective 5(b), very few 
monitoring committees met in 1990. There will be one committee per CSF 
(44 in all), plus eight regional committees for Spain. 
To sum up: 
in the cases of the most advanced Objectives, the majority of CSF 
Monitoring Committees were established and met for the first time 
in 1990 or at the beginning of 1991; 
- 11 -
programming of the CSF Committees for the current year is clearly 
laid down. An indicative schedule of meetings in 1991 has been 
drawn up on the assumption that the CSF Committees will normally be 
preceded by various committees meeting at operational programme 
level. The CSF Monitoring Committees will make the adjustments 
required by any developments that have occurred att the operational 
level. In the particular case of Objective 2, the meetings in 1991 
will also have to handle the operational transition from the CSFs 
for the first phase (1989-91) to those for the second one-, 
the process of approving the rules of procedure for these 
Committees has either been completed or is in progress. The 
novelty of the procedure for the administrations concerned is 
undoubtedly the reason why this has taken longer than expected. 
Without going into details of the meetings, the following general 
comments may be made: 
In most cases, the CSF implementation reports permitted a thorough 
and individual analysis of each form of assistance. Since the 
meetings took place at an early stage, they rarely resulted in 
formal changes to the CSFs in 1990 but a large number of changes 
have been scheduled for 1991. 
The regional Monitoring Committees have provided an excellent forum 
for a genuine tripartite partnership (Commission, national 
government, region). They have also permitted emergence of a 
certain transparency in the operational decisions which underlie 
Community assistance and they provide an opportunity for all the 
partners to keep each other informed. The attitude of the regions 
in these committees is very open. 
While representation of the regional authorities on the Committees 
is satisfactory, the socio-professional organizations and 
employers' and workers' organizations do not always receive 
adequate information. These bodies have participated more 
frequently with regard to training or employment measures financed 
by the ESF. The Commission will continue to encourage the 
committees to keep them informed, where appropriate outside their 
formal meetings. This technique met a positive response in the 
context of the IMPs. 
Most of the CSF Monitoring Committees have concentrated their 
efforts on financial matters. Many of them have agreed on the use 
of standard tables to present the requisite indicators. On the 
other hand, despite some limited attempts, the physical indicators 
have proved far more difficult to identify and manipulate 
(difficulty of obtaining composite data). Some Committees have 
proposed concentrating their efforts on monitoring physical 
indicators at operational level (i.e. at programme level). 
- 12 -
Establishment of computerized monitoring systems has also been 
discussed. Although the vast majority of national partners are 
willing to compile financial monitoring tables fairly rapidly, it 
will take some time to make the system truly operational. Linking 
up directly with the Commission departments also raises a number of 
problems and a pilot-project approach appears to be the only 
feasible one at the moment. 
Most of the Committees also discussed the use of technical 
assistance. Although some Member States undoubtedly appreciate the 
advantage of having monitoring and assessment work financed in this 
way, it is not certain that all the possibilities have been 
explored or that sufficiently flexible models have been laid down. 
The determining factor will be the speed with which the authorities 
responsible for implementation can respond to obstacles by finding 
acceptable solutions or immediately preparing alternative projects 
or measures pursuing the same specific objective. 
In some cases, the allocation of responsibilities between the 
Monitoring Committees and the supervisory authorities has proved 
more delicate. The CSF Monitoring Committees must have adequate 
decision-making powers to be able to make the changes required by 
the varying pace of the different forms of assistance. 
Accordingly, during 1991 the Commission reviewed the rules 
governing amendments to the CSFs and OPs. 
A detailed summary of the meetings of the Committees in 1990 and 
forecasts for 1991 are in Annexes 1 and 2. 
3.1.1.2 The role of management and labour in monitoring work 
The Commission wishes to encourage the participation of management and 
labour in achieving the objectives of the reform through sustained 
dialogue and efforts to find suitable consultation procedures. 
Accordingly, it launched a programme of meetings with the social 
partners and national and regional administrations to discuss the 
principles of the reform, the objectives and the priorities selected in 
the Community support frameworks and their application in the regions 
and areas eligible under Objectives 1 and 2. In all, 16 meetings have 
been held, covering virtually all the regions concerned. 
A series of training and information seminars were held alongside these 
meetings to familiarize regional trade union leaders with the new 
structural policies arising from the reform. 
Overall, this experiment was regarded as successful both by the social 
partners and by the Commission. 
These bodies have submitted comments and suggestions which may help the 
Commission when it considers future guidelines for its structural 
policies. 
- 13 -
The constructive dialogue between the parties concerned has induced 
some Member States to seek ways of keeping management and labour 
regularly informed or associating them with the Monitoring Committees. 
The Commission intends to encourage this process further. 
However, the regulations concerning the Structural Funds do not impose 
any obligation to involve the social partners organizations in 
monitor ing work. 
It is for the Member States to decide which partners (regional, 
Ioca I/or social) should be associated with these committees. 
It is noticeable that the involvement of the social partners is more 
frequently foreseen in the fields covered by Objectives 3 and 4, where 
the Member States already have institutionalized dialogue with such 
bodies. The social partners participate in the monitoring committees 
in 9 Member States (Spain, Greece, Ireland, France, Germany, 
Luxembourg, Belgium, the Netherlands and Denmark). 
In 3 Member States (Italy, United Kingdom and Portugal), in which the 
constitution of the monitoring committees does not enable participation 
of management and labour, the national administrations have given 
assurances that they will be kept informed. 
3.1.2 The preparation of systems for monitoring forms of assistance 
The introduction of monitoring systems in each Member State is 
essential if the Committees are to work effectively and provide the 
necessary guarantees as regards the implementation of Community 
commitments, allowing adjustments where necessary to the original 
programming laid down in the Community Support Frameworks. 
The Commission is currently tackling the problem on two fronts, by the 
preparation of data handling systems (software) and by the provision of 
equipment (hardware). Technical assistance appropriations have been 
used for this purpose in most countries. 
Preparation of systems (software) 
Software prototypes are being prepared for all the Objective 1 
CSFs, either by administrations acting as national coordinators 
(IRL, GR, Northern Ireland, ES) or by consultancy companies (P). 
In France and Italy the IMP system has been adapted so that it can 
be used for new measures 
In some cases (GR, IRL), these prototypes have been tested to check 
that they are adequate and that they comply with the monitoring 
requirements as laid down in the rules and decisions. 
In the case of Objective 2, with a few exceptions (D, UK, ES), the 
volume of appropriations involved in the various CSFs and 
operational assistance is inadequate to justify the preparation of 
dedicated systems. Here, for small programmes, the approach 
involves simple compilation of financial and other implementation 
data and appropriate presentation of these data to the Monitoring 
Committees. 
- 14 -
The Commission has prepared a standardized system of forms and 
computer programs for measures part-financed by the ESF so that all 
forms of assistance can be monitored from approval to final closure 
of the dossier. 
These programs are available to all the Member States so that they 
can monitor each type of assistance from the point at which the 
basic data are entered (application for assistance) to submission 
of applications for payment of the balance. 
This system should permit analysis of the basic financial and 
physical data relating to measures. 
Computer equipment (hardware) 
Two comments are particularly pertinent at present. The first is 
that the situation varies from one country to another, depending 
particularly on the level analysed (national or regional), and the 
second is that steps have been taken to make up for the deficit in 
equipment. 
At national level, the situation as regards computer equipment may 
be considered satisfactory although leaving room for improvement in 
certain countries (P, GR, F), while elsewhere (IRL and Northern 
Ireland) installation is in progress. In Spain and Italy, needs 
are currently being assessed. 
At regional level, in regions other than those covered by IMPs, 
less progress has been made. However, steps have been taken to 
acquire the equipment required in all the Objective 1 regions. 
In the case of measures part financed by the ESF, the Commission 
has provided, at central level in all the Member States, the 
computer equipment needed for transmission between the Member 
States and the Commission. 
Data provision and operation 
At present, operations are monitored on the basis of manual or 
semi-automatic collection and processing of data. In most 
countries (I, GR, P, F, IRL), the Monitoring Committees have 
already produced reports on financial implementation. 
The Monitoring Committees also base themselves heavily on the 
tables prepared by the Commission. 
The organization of work in the various countries suggests that the 
financial aspects of computerized monitoring systems could be 
operational before the end of 1991. But the regular input of data, 
particularly data on physical implementation, will be a difficult 
task which should not be underestimated. 
- 15 -
Training and information for staff responsible for operating the 
system have begun and will have to be stepped up once the various 
systems have been approved by the parties concerned. 
Technical assistance to the Member States is one of the ways in 
which the Commission can help them to set up these monitoring 
systems. 
Provision of data on training and employment measures part-financed 
by the ESF has been tested centrally in each Member State by the 
national authorities. This should permit each form of assistance 
to be monitored on the basis of financial and physical information. 
4.1 The nee<J for greater Simpl If jçftt Ipn Qf Procedure? 
In December 1990 the Commission made some procedural improvements to 
remove certain obstacles to satisfactory implementation. 
These concentrated on certain priorities: 
greater flex ibiIity; 
speedy approval of forms of assistance (improved internal 
Commission procedures); 
improved financial provisions and channels. 
New decisions extended these initial provisions in June 1991. 
4.1.1 Greater flexibility 
The reform of the structural Funds establishes principles common to all 
the Objectives. The experience of 1990 shows that of the 118 CSFs 
approved, 65 (40 for Objective 2 and 24 for Objective 5(b)) involve 
assistance totalling less than ECU 50 million each. In contrast, the 
estimated amount of assistance for 12 CSFs exceeds ECU 500 million (see 
table in Annex 3). 
Because of the difficulties encountered, the Commission decided that, 
while respecting the rules in force, it would differentiate between 
mechanisms on the basis of the amount of the resources programmed and 
the type of assistance. This new flexibility has two aspects: 
simplification of programming procedures for the CSFs and forms of 
assistance for the second phase of Objective 2 (1992-93); 
simplification of procedures for amending the CSFs and the forms of 
assistance by increasing the powers of the Monitoring Committees. 
In practice, the Commission rules authorizing the Monitoring Committees 
to make changes to the forms of assistance under certain circumstances 
have proved too uniform in the face of the diversity of situations to 
which they apply. They do not permit sufficient flexibility of 
implementatIon. 
- 16 -
In the light of the work of the Monitoring Committees in 1990 and 
requests submitted by the Member States, the Commission has decided to 
increase their powers enabling them to make necessary changes in the 
financing plans for the CSFs and the forms of assistance. This has 
introduced a differentiation according to the Objective (Commission 
Decision of 29 May 1991). 
Naturally, substantial changes to the CSF can still be made only on the 
basis of a Commission decision taken in agreement with the Member 
State. 
4.1.2. Improved financial provisions and channels 
The reform of the Funds clearly established the principle of part-
financing instead of reimbursement, which, with some exceptions 
(existing measures and some Objective 5(a) horizontal measures), is no 
longer used. 
Application of this principle depends on the capacity of the national 
authorities and the Community to submit, examine and approve forms of 
assistance and on an improvement in the rate of commitments. 
On 20 December 1989 the Commission adopted financial provisions common 
to all the forms of assistance. 
Implementation of these provisions encountered a number of obstacles, 
in the case of multiannual programmes very often related to the problem 
of reconciling the rules governing commitments and the payment of 
public expenditure in certain Member States with those governing the 
commitment and payment of Community assistance, particularly if the 
principle of part-financing is to be observed. 
In December 1990 the Commission amended the financial provisions 
governing forms of assistance. Under Article 21 of the coordinating 
Regulation, appropriations are implemented in the form of annual 
instalments and an adequate level of utilization of earlier instalments 
is a condition for subsequent commitments. 
It was decided that an annual instalment of Community assistance would 
be committed once the Member State had certified to the Commission that 
actual expenditure amounted to at least 40% (instead of 60%) of 
eligible costs under the preceding instalment and at least 80 % 
(instead of 100%) of eligible costs relating to the instalment before 
last), and that the programme was progressing in line with its 
objectives. To prevent any slackness in budgetary management, it was 
specified that, although the next commitment could be made, the 
corresponding payment could not be implemented until 60% of the total 
cost of the measure had been incurred. 
The purpose of these changes was to speed up the commitment of 
appropriations for multiannual measures in those Member States which 
desired it. In a number of Member States the budgetary and financial 
procedures governing commitments and payment of public expenditure for 
programmes part-financed by the Community required confirmation of the 
budgetary commitment of Community assistance. 
- 17 -
The Commission has also continued its study of the financing channels 
used in each Member State to see what accounting improvements could be 
considered to speed up the payment of Community funds to final 
benef iciar ies. 
Within its own departments the Commission has improved the procedures 
governing the booking of its financial commitments in an attempt to 
reduce delays in paying Community assistance from the structural Funds. 
- 18 -
CHAPTER 2 IMPLEMENTATION OF OBJECTIVE 1 
1-1 General overview 
1.1.1 Difficulties encountered 
For many Member States the deadlines for submission of the draft 
operational programmes were long enough. Indeed, some countries 
(Ireland, Portugal) submitted programmes during the course of 1989, 
either Just before approval of the CSFs or shortly afterwards so that 
the Commission could approve them as early as 1989. But the number of 
such cases was relatively small. For most countries the programmes were 
submitted during 1990 and some programmes had still not been submitted 
at the end of 1990. 
The case of major projects is somewhat different in that many of them 
were included in dossiers already well advanced in the Member States, 
which were able to submit them officially for approval in 1989 (e.g. in 
Italy and, to a lesser extent, Spain). 
In addition to the difficulties experienced by Member States in 
defining the contents of the measures, there was the time required for 
the Commission to appraise the programmes. In many cases the main need 
for clarification related to aid schemes included in the OPs and to 
verification of the environmental impact of the planned measures. 
These two considerations, relating to compliance with other Community 
policies, were the main causes for delay in the approval of the 
operational programmes. 
The CSFs of some countries did not contain sufficient information on 
the forms of assistance envisaged for the implementation of the CSF 
priorities. This was requested during the negotiation stage but could 
not be provided. This imprecision as reflected in the CSF* also 
resulted in further delay in submission of the forms of assistance. It 
also shows that the CSF programming exercise was not necessarily b^ssd 
on a clear vision of implementation. 
In the case of the ESF, Article 9 of Council Regulation (EEC) 
No 4255/88 stipulates that applications in respect of measures to be 
implemented in 1990 had to be submitted by 31 August 1989. In fact the 
CSFs were approved later and this led to considerable amendment of the 
applications initially lodged by the Member States. 
In the case of the EAGGF, the major change of approach due to the 
transition from the traditional notions of direct and indirect measures 
to the operational programme approach created additional difficulties 
for the Member States which indirectly affected the speed with which 
programmes were submitted and examined. 
On the whole a considerable amount of work had to be done in 
partnership to improve the contents of the programmes, in particular 
the financing plans, the project selection criteria, quantification of 
the objectives and definition of the physical and financial indicators 
to be used for monitoring purposes. 
- 19 -
1.1.2 Multifund approach under Oblectlve 1 
As already mentioned, the Commission tried to promote the multifund 
approach for ail the Objectives to which it could be applied. 
In the case of Objective 1, a considerable number of multifund 
operational programmes were adopted. This form of assistance was 
already planned for some countries and the CSFs were implemented in 
accordance with the plans. For other countries the multifund approach 
was agreed on in the course of the negotiations. The integrated 
approach has been more widely used in the three countries fully covered 
by Objective 1. The priority "upgrading of basic infrastructure", for 
which ECU 10 656 million was provided for in the CSFs of the seven 
countries involved, was implemented mainly in the form of major 
projects. This is especially true in the countries where the priority 
is of special importance (Greece, Spain, Ireland, Portugal and Italy). 
In some cases major projects were included in the operational 
programmes. 
Thus, the greatest scope for applying the multifund approach is offered 
by the priorities relating to the improvement of business 
competitiveness (ECU 5 466 million provided for in the CSFs), support 
infrastructure for economic activities and the development of 
indigenous potential1, as well as for measures aimed at training 
infrastructure. 
For the seven countries, these three priorities accounted for 
ECU 14 022 million in the CSFs. The appropriations committed in the 
form of multifund operational programmes for these priorities totalled 
ECU 9 519 mi I I ion. 
1.1.3 Analysis of the forms of assistance by Member State 
Although the implementation of Objective 1 has so far necessitated 303 
forms of assistance, the situation varies from Member State to Member 
State. 
In the less regionalized countries (Ireland), the number of forms of 
assistance is smaller. The Irish CSF is being implemented by means of 
12 monofund and multifund operational programmes. In the countries with 
highly regionalized CSFs (Spain, Greece, Italy and Portugal), the 
number of forms of assistance submitted by the Member State and 
approved by the Commission is large (some 50 programmes for Portugal). 
Preparation of the programmes therefore entailed a considerable volume 
of work for the various partners. 
The distribution of responsibility peculiar to each Member State is 
also reflected in implementation. Thus, in the case of measures 
relating to human resource development, for which responsibility is 
regionalized in many Member States, implementation involves a large 
number of forms of assistance (Greece, Portugal, Spain). The situation 
is similar in the case of agricultural measures, for which certain 
countries have long applied a regionalized approach (Spain, France and 
Italy) whereas others have maintained centralized control (Greece, 
Ireland). 
Nomenclature published in the First Annual Report 1989 - Annexes 
IV-2 ff. 
1.1.4 - 20 -
The results of Implementation as regards appropriations approved 
1990 was a very busy year in terms of submission, negotiation and 
approval of the forms of assistance. In spite of some difficulties, the 
combined efforts of the Member States and the Commission made it 
possible to achieve a satisfactory level of commitment of the 
appropriations provided for in the CSFs. 
At 31 December 1990 assistance approved for measures provided for in 
the CSFs of Objective 1 countries, taking into account ongoing measures 
approved before 1 January 1989, was as follows: 
COMMUNITY ASSISTANCE APPROVED TO 31.12.1990 
MemberState ERDF ESF (ECU million, 1989 prices) 
EAGGF AMOUNT AMOUNT 
APPROV. IN CSF 
Greece 
Spain 
France 
Ireland 
Italy 
Portugal 
United Kingdom 3 220.0 
4 756.0 
389.0 
1 642.0 
4 091.0 
3 711.0 
347.0 449.0 
337.0 
324.0 
357.0 
463.0 
017.0 
312.4 277.0 
186.7 
159.4 
654.0 
665.1 
147.2 
130.0 5 946.0 
8 279.7 
872.4 
3 653.0 
6 219.1 
6 875.2 
789.4 667 
779 
888 
672 
443 
958 
793 
TOTAL 18 156.0 9 259.4 5 219.4 32634.8 36200 
Note: When reviewing implementation in terms of aid granted, it must 
always be borne in mind that the CSF allocations are in 1989 
prices whereas implementation is normally assessed at the prices 
obtaining in the year of approval of the operational programmes. 
In order to be able to compare the various prices, the amounts of 
assistance decided on have been converted to 1989 prices. 
The whole of the Objective 5(a) portion of Objective 
included in the ECU 5 219 million for the EAGGF. 
1-2 Implementation of the CSFs by Member State 1 is 
1.2.1 General analysis 
The purpose of this section is to take an overall look at the forms of 
assistance and more particularly the main measures included in the 
operational programmes. 
A detailed list of the forms of assistance approved will be published 
by the Commission separately (Statistical Bulletin). In addition the 
reports provided for in Article 25 of the coordinating Regulation will 
complement this Annual Report. 
- 21 -
In making an overall analysis the intention is to identify the broad 
lines of structural intervention as implemented through the forms of 
assistance approved. 
These main thrusts have already been examined within each CSF and 
examined further in the 1989 Annual Report. 
The purpose here is to draw some conclusions from the actual 
implementation which has resulted from the operational programmes 
approved in relation to new measures. 
A first conclusion is that the programmes' contents appropriately 
reflect the main action priorities which were jointly negotiated during 
the preparations of CSFs, whether in terms of sectors assisted or in 
terms of the distribution of actions between the multi-regional and 
regional levels. 
In this last respect, it is notable that, at the end of 1990, 
(approximately) 94 regional operational programmes had been approved, 
representing a level of funding of ECU 8100 millions, excluding 
Objectives 3 and 4. The bulk of these programmes are multi-fund, 
drawing on all three funds and covering practically all of the CSF 
pr ior it ies. 
Within regional programmes, most of the Community funding is allocated 
to transport infrastructure. However, more than half of these actions 
fall within the CSF for Spain. 
Other important action priorities in the regions are assistance to 
businesses for productive investment and measures supporting human 
resources. 
Water-related infrastructure intended to meet local or regional needs 
also has an important place in regional programmes. 
Regional actions are complemented by actions of a multi-regional type. 
Multi-regional programmes decided in 1989 and 1990 have attracted more 
than ECU 10 million in Community funding. Objectives 3, 4 and 5a are 
not included in this amount. 
As in regional programmes, transport Infrastructure occupies a major 
place. Programmes aiming to reduce the effects of peripherality and to 
improve transport have been approved in four Objective 1 countries 
(Portugal, Ireland, Greece, and the United Kingdom) as well as in Spain 
where significant investments are planned for the Madrid-Seville TGV. 
A second priority for multi-regional programmes relates to aid towards 
productive investment in industry and services augmented by aid towards 
investment in directly related infrastructure. At the end of 1990, 
programmes concerning this priority area had been approved in all the 
countries in question except Spain-, Further programmes of this type 
will be added in 1991 particularly in Greece and Italy. 
- 22 -
Finally, the third most important priority in multi-regional programmes 
relates to human resources, which includes a new approach to skill-
training as well as the improvement of education and training 
facilities. In this last respect, Community assistance is concentrated 
primarily in Greece, Ireland and Portugal. 
With regard to agriculture and rural development, the implementation of 
this priority is distributed more or less evenly between the regional 
and multi-regional headings. As noted earlier, some countries have for 
a long time adopted a regionalised approach to the implementation 
action if favour of agriculture (Spain, France, Italy), whilst other 
member states maintain central control of operations. 
1.2.2 Measurement of the overall socio-economic Impact of structural 
assistance 
The 1988 decisions to double the resources of the structural Funds and 
concentrate their efforts on Objective 1, as laid down in Article 12 of 
the framework Regulation, were intended to ensure that Community 
assistance achieves a greater macroeconomic impact. 
The potential impact of the reform of the structural Funds should have 
its most far-reaching macroeconomic impact in the three countries 
entirely covered by Objective 1 (Greece, Ireland and Portugal). This is 
borne out by the large amounts of public expenditure (national and 
Community) entered in the CSFs for these countries, which, as a 
percentage of GDP, represented in 1989 an average of 6.4% for Portugal, 
5.2% for Greece and 3.7% for Ireland. The macroeconomic effects should 
also be considerable in the Spanish Objective 1 regions and the 
Mezzogiorno, where eligible public expenditure accounts for between 1% 
and 2% of GDP. 
In addition to a substantial increase in the financial resources 
available for the economies of these countries, the CSFs also entail an 
improvement in human capital and an increase in the rate of investment. 
The latter two are the most important factors for determining the rate 
of increase of an economy in the medium to long term. 
Given the general direction of the Objective 1 CSFs, aimed at 
reinforcing the productive structure of the regions concerned, major 
economic effects can be expected on both the supply and demand sides. 
On the demand side, the effects are short term and result from the 
direct, indirect or induced increase in demand due to implementation of 
the CSF. On the supply side, effects are both more important and long-
term and represent the most decisive factor for structural improvement 
of the regions. The supply-side effects result from the creation of new 
productive capacity, Improved skills in the workforce, the setting up 
of a network of infrastructures to open up the region receiving aid, 
the dissemination of technological progress and an improvement in 
production technology. 
- 23 -
in the medium term the effects of the CSF on supply will enable the 
less-developed regions to achieve higher levels of productivity and 
competitiveness, thereby bringing about levels of development similar 
to those elsewhere in the Community. But it should be borne in mind 
that strengthening economic convergence, which is the basic objective 
of Community assistance, also depends on economic policy. The 
interplay between Community assistance and national economic policies 
will, as stressed in the Single European Act, be decisive for ensuring 
that the anticipated effects of the CSF are achieved in full. In 
particular, lasting growth can be achieved only within the context of 
macroeconomic stability, which all the Community is striving to bring 
about through Economic and Monetary Union. 
Any attempt at this stage to quantify the impact of the concentration 
of Community assistance on the least developed regions runs up against 
problems of a methodological and statistical nature. 
The Commission has responded to these problems in two ways. Firstly, 
an analysis was undertaken using harmonized Eurostat sources and a 
common methodology, to assess the general economic impact on selected 
macroeconomic indicators in a way which permits effects in the 
different Member States to be compared. The special features of the 
French Objective 1 areas meant that France had to be excluded from this 
assessment. 
In the second approach, independent national assessors were called in 
to use existing models in each Member State; this method had the 
advantage of being more powerful than the first. Since the conceptual 
basis of the models were different from one country to the other, 
comparison of the results is more difficult. 
The first, more homogeneous, results are given below. The second 
results are included in the country-by-country analysis. 
The main questions to which an answer comparable across the beneficiary 
Member States was sought may be summarized as follows-. 
- How much of the economic growth expected in the period from 1989 to 
1993 can be attributed to the CSFs in general and to Community 
grants in particular? 
- How will the CSF and the Community grants influence the economic 
aggregates and the structure of the beneficiary economies? In 
particular what part of the Community grants will be transformed 
into demand and production in the target region and what proportion 
will leak away via increased demand for imports? 
- How can we assess the employment effect of the implementation of the 
priorities agreed in the CSF, i.e. how many Jobs depend upon 
implementation of the measures in the CSFs, and more particularly 
upon the planned financial transfers from the Community? 
- 24 -
The main element of this impact analysis is a system of harmonized 
input-output tables for the Community established by Eurostat for 1985 
and projected for 1989 to 1993. All projections are based on 
harmonized National Accounts, on the official economic forecasts 1991-
92 and on the corresponding medium-term projections 1991-95 produced by 
the Directorate-General for Economic and Financial Affairs in October 
1990 (see models J and K in Annex 4). 
CSFs and growth of GDP from 1989 - 1993 
- average annual growth rate -
Portugal 
Ireland 
Spain(ObJ.I) 
Italy(ObJ.I) 
UK (Obj.1) 
Greece Expected growth 
rate including 
the CSF 
4.1 
4.0 
3.4 
2.6 
2.3 
1.7 Growth excluding 
Community grants 
3.4 
3.7 
3.2 
2.4 
2.1 
1.2 Growth excluding 
the CSF 
2.4 
3.3 
3.0 
2.3 
1.9 
0.5 
In interpreting these results one must keep in mind that the analysis 
is based on the officially approved and published CSFs and that it also 
reflects the differing rates of overall Community grants negotiated in 
the CSFs, as described in the annual report for 1989. The columns 
representing the average annual growth rate "excluding Community 
grants" and "excluding the CSF" have been calculated by subtracting 
from the GDP levels attained in 1993 that part of GDP which is 
estimated to be due to the CSFs and to Community grants in particular, 
assuming that all other things remain unchanged. 
The efforts made by the Community through its structural policy will be 
successful if growth in the target regions exceeds the Community 
average and if they change their economic structure towards innovative 
and competitive sectors. All CSF regions except Northern Ireland and 
Greece are expected to grow above the European average estimated in 
October 1990 at an annual average rate of 2.7% for the five years up to 
1993. According to these estimates the biggest contribution to 
anticipated average annual growth, namely 0.7% and 0.5%, can be 
assigned to Community grants for Portugal and for Greece. Due to 
Community transfers Portuguese GDP is expected in 1993 to be some 4.0 % 
above the level that would have been reached without the transfer of 
Community funds. Whereas Greek GDP is expected to be 2.6 % higher than 
it would have been otherwise. The comparably small compound effect of 
the Funds' transfers in this Member State is due to the weak expected 
overall performance of the economy which is going through a difficult 
adjustment process. In Ireland 0.3 %, in Spain (ObJ.1), Italy (Obj.1) 
and in Northern Ireland 0.2 % each of average annual expected growth is 
explained in the five years to 1993 by Community grants. 
- 25 -
These findings demonstrate the significant effect of Community support 
in the weakest Objective 1 regions. To illustrate the relative 
importance of Community funds for the regions covered by Objective 1, 
the effects on the economy were estimated on the assumption that the 
transfers in 1993 were abruptly withdrawn, all other things remaining 
constant. The estimates indicate that some economies would suffer from 
a severe demand shock if the co-operative efforts for promoting social 
and economic adjustment in the regions lagging behind were not 
continued beyond 1993. 
Economic growth and Community grants 
- % change in GDP 1993/1992 -
Expected growth Growth if Commu-
rate including nity grants were 
the CSF not available 
in 1993 
Portugal 3.9 0.9 
Ireland 3.5 2.0 
Spain(ObJ.I) 3.4 2.4 
Italy(ObJ.I) 2.6 1.8 
UK (ObJ.1) 1.9 1.1 
Greece 1.6 -0.5 
Though the results presented here account only for the demand effects 
of the CSF, by the extent to which capital formation (GFCF) will be 
induced, they allow, however, for a rough assessment of the relative 
influence of the CSFs on the supply potential of the economies 
concerned. Over the five years of the CSFs' lifetime the potential 
output of the beneficiary economies has been linked to the increase in 
the capital stock expected as a consequence of the realization of the 
investment projects under the CSFs and Community grants in particular. 
The respective results are consistent with the estimates presented here 
and confirm in particular the relatively smaller importance of 
Community support for regions in Member States not entirely covered by 
Object ive 1. 
- 26 -
CSFs and Gross Fixed Capital Formation 
Portugal 
Ireland 
Spain(ObJ.I) 
Italy(ObJ.I) 
UK (Obj.1) 
Greece Expected growth 
rate of GFCF 
including the 
CSF 
- average annual 
growth rate 
1989 - 1993 -
7.9 
8.4 
8.4 
4.1 
3.2 
5.0 X Of GFCF 
depending on 
the CSF 
- 1993 -
23.2 
17.7 
6.9 
6.3 
12.5 
25.3 X Of GFCF 
depending on 
Community grants 
- 1993 -
8.3 
7.5 
3.5 
2.8 
4.8 
11.5 
These figures clearly illustrate, through the contribution to the 
increase in the capital stock, the crucial importance of a steady 
implementation of the CSF for the potential growth of the economies of 
above all Greece, Ireland, Portugal, but also Northern Ireland. 
The selection of the priorities of all CSFs contributes to a structural 
change of the backward economies in an appropriate direction. Selected 
industries will emerge as growth poles and the marketable service 
sector will benefit considerably from the CSFs. 
The beneficiary Objective 1 regions can be classified as small open 
economies with a narrow industrial base, where many capital products or 
parts of such goods which are vital for the implementation of the 
priorities of the CSFs are not produced at home but have to be imported 
from the industrialized EC-economies or from third countries. As a 
consequence Community grants are only partially transformed into GDP of 
the regions concerned. An attempt to estimate the leakage effects 
suggests, however, that production losses due to increased imports are 
not a significant problem, possibly as a consequence of the 
concentration of assistance in the construction sector. 
Given the importance of the CSFs and of Community grants substantial 
employment effects are to be expected from the realization of the 
operations under the CSFs. By 1993 approximately 840,000 Jobs or 3.8% 
of the work force in the Objective 1 regions are estimated to be 
affected by the implementation of all of actions foreseen under the 
CSFs, of which some 350,000 may be accounted for by Community grants. 
In order to avoid possible misunderstandings in this respect, the 
employment impact as indicated here does not represent new Jobs nor a 
contribution of the Community to reduce un- and/or under- employment in 
the assisted regions. It only indicates how many jobs in 1993 will 
depend on Community grants in implementing the CSF. 
- 27 -
Estimated work force dependent on Community grants 
- year 1993 only -
Absolute (thousand) % of total occupied 
populat ion 
Portugal 116.7 3.1 
Ireland 17.0 1.5 
Spain(ObJ.I) 54.2 0.7 
Italy(ObJ.I) 47.1 0.9 
UK (ObJ.1) 4.1 0.7 
Greece 117.7 3.2 
It should be emphasized that the above summary of the short term demand 
impacts of CSFs in general and of the Community grants in particular 
elaborated on the basis of a common methodology, which has been made 
comparable as far as present circumstances allow, depicts the 
contribution of the CSFs to estimated economic growth. This is only one 
possible impact analysis amongst many other competing assessment 
methods. 
The results set out in the country-by-country analysis below are based 
on studies carried out at the Commission's request by independent 
external assessors, using a variety of macroeconomic models. The 
methods used are described briefly in Annex 4. 
They show that, in overall terms, the potential impact of the 
Structural Funds could raise the GDP of these countries and regions in 
1993 by 1.5% to 2.5%. 
For these countries, therefore, the CSFs will increase 
their ability to catch up with the rest of the Twelve. considerably 
Clearly, the 
the level of actual impact of the measures in the CSFs will depend on 
implementation of expenditure in the Member States. 
In addition, as already explained, the effect estimated at the end of 
five years does not reflect the greatest benefits accruing from the 
CSFs. These will become apparent over a longer period in the form of an 
enhanced potential for sustained growth, a reduction in perceived 
remoteness and therefore greater participation in the dynamic effects 
of integration. 
- 28 -
1.2.3. Qreeçe 
1.2.3.1. Implementation of the CSF 
The CSF for Greece was approved in March 1990. In spite of the delay 
compared with other Member States, for which the CSFs were approved in 
October 1989, implementation in terms of forms of assistance approved 
is proceeding satisfactorily and in accordance with the programming in 
the CSF. Four dossiers covering a total of ECU 590 million still have 
to be approved, including the Athens underground, a multifund OP on 
improving business competitiveness submitted in July 1991 and a 
multifund OP for tourism. 
For implementation of the measures great emphasis was placed on 
regionalization. Thirteen regional multifund operational programmes 
were approved in 1990. 
This made it possible for representatives of the Greek regions to play 
a major role under the responsibilities devolved upon them by the 
decentralization law. 
By contrast major projects are managed at national level since they are 
of great importance for the economic development of the country (e.g. 
Athens underground, natural gas infrastructure, motorway system). 
There are some difficulties as regards the launching (in the case of 
the underground) or Implementation (natural gas and roads) of these 
projects. The Commission is monitoring their implementation carefully. 
The initial monitoring results show that the rate of implementation of 
major projects has been satisfactory but there have been delays as 
regards main roads. For all the measures approved by the Commission, 
the Greek authorities have set up Monitoring Committees. Most of them 
met in 1990. 
As regards content, implementation of the priority "upgrading of basic 
infrastructure" will be mainly through major investments in 
infrastructure. 
The priority "development of agricultural resources" is being 
implemented at both national and regional level. At national level the 
measures relate to structural aspects (water engineering measures) and 
schemes to encourage early retirement. In addition there are some 
sectoral measures approved prior to the CSF and included in it 
(phylloxera control, apricot programme). 
At regional level multifund OPs are being implemented for the following 
priorities: conservation and improvement of the environment, 
conservation and utilization of natural resources and agricultural 
divers ification. 
Implementation of the priority "development of human resources" has 
been satisfactory, in 1990 39 forms of assistance were adopted, for a 
total commitment of ECU 1 159 million out of the 1 438 million planned 
for the period 1990-93. 
- 29 -
The measures are fairly well regionalized, especially those concerning 
basic training, employment aid and secondary education. Implementation 
of the CSF has permitted the regional i zat ion of Objective 3 and 4 
measures to begin. 
The multifund approach is mainly used for the regional section of the 
CSF, the majority of the other priorities being implemented in the form 
of monofund OPs. 
As regards the take-up of the tranches for 1989 and 1990, the figures 
provided by the most recent CSF Monitoring Committee were as follows: 
- for the national section: 85% in 1989 and 80% in 1990; 
- for the regional section excluding the I MPs: 60% in 1989 and 60% in 
1990; 
- for the IMPs: 75.5% in 1989 and 75.7% in 1990. 
The Greek authorities plan to increase expenditure in the regional 
section in 1991, which started late. 
In the Commission's view it might be best to reprogramme the measures 
to achieve optimum utilization of resources. 
1•2.3.2. Socio-economic impact of assistance provided for in the CSF 
The economic impact of the Greek CSF was assessed using a Keynesian 
macroeconomic model. Given the short-term nature of the model, only 
demand effects could be taken into consideration (see model A in Annex 
4). 
In order to assess the effects of the CSF on growth and on the main 
macroeconomic variables of the country, two scenarios were considered: 
the first without the structural Funds and without a renewal of the 
previous Community structural policies and the second with Community 
assistance. 
The results cover the period 1989-93. They show that the Structural 
Funds have brought an average acceleration in the growth of the Greek 
economy of a little less than 0.5% per annum. As a result of the CSF, 
Greek GDP will be 2.3% higher in 1993 compared with a scenario without 
a CSF. 
However, as a result of slow growth In Greece during the period 
concerned, the effect on employment will be rather small: as against a 
scenario without a CSF, in 1993 the total increase in employment will 
be only Just over 45 000. Consequently, the contribution which the CSF 
will be able to make in the fight against unemployment in the short-to-
medium term will be rather limited. Only if the supply-side effects 
(more skilled workforce, reduced transport costs, easier access, etc) 
begin to make themselves felt will there be any hope of an appreciable 
Increase in employment in Greece. 
- 30 -
The impact of the structural policies will be considerable on the 
construction and tourism sectors but, as a result of the restructuring 
of the Greek economy currently under way, rather less on the exporting 
sectors. The impact on agriculture is also expected to be 
considerable, with an increase in Investment exceeding 20% per year 
between 1989 and 1993. 
1.2.4. Spain 
1.2.4.1. Implementation of the CSF 
The structure of the CSF for Spain, and the large number of national, 
regional and local authorities involved in its implementation, have 
produced a very large number of forms of assistance. These were 
prepared in close liaison with the various authorities concerned. The 
partnership with the regional authorities can be considered to have 
functioned properly but links between the Commission and the local 
authorities have been no more than sporadic, given the large number 
concerned. 
This internal complexity of the Spanish CSF was overcome in 1990 and 
almost all the scheduled forms of assistance were approved by 
31 December 1990. Once a decision has been taken on the nine remaining 
forms of assistance, implementation will have been completed. 
Altogether, implementation will involve more than 130 forms of 
assistance, some of which were approved before the reform and are 
continuing into the period 1989-93. 
This means that assistance is widely dispersed over a number of small 
programmes. This is true of the implementation of the infrastructures 
and development of agriculture priorities and of the priority for 
Object ives 3 and 4. 
The majority of new measures provided for in the CSFs under the ERDF 
were decided upon during the second half of 1990. 
In terms of content, the share occupied by major infrastructure 
projects and productive investment continues to be high. In addition 
to 32 new major projects, 16 operational programmes involving ERDF 
participation have been approved. 
As regards measures to make optimal use of agricultural resources, 
three major priorities feature in the programmes: improvement of the 
natural and structural conditions of production, protection of the 
environment and conservation of natural resources and conversion and 
diversification of production. Of the 32 OPs submitted, 25 were 
decided upon during 1990. 
As regards human resources, almost all the appropriations have now been 
mobilized. The number of forms of assistance for this priority is also 
high (45, plus three programmes already approved for the IDOs). 
The speedy implementation of the CSF should also be noted. 
- 31 -
According to the data emerging from the last Monitoring Committee 
(2 July 1991), almost 75% of the funds committed for 1989 and 1990 have 
been spent. 
1.2.4.2. Socio-economic Impact of assistance provided for in the CSF 
The economic impact of the Spanish Objective 1 CSF was assessed ex-ante 
using a macroeconomic model (see model B in Annex 4). 
This is an annual demand model using two scenarios in order to assess 
the effects of structural policies: the first incorporates the effects 
generated by Community expenditure and national part-financing, the 
second excludes these investments and analyses the development of the 
Spanish economy in the absence of structural assistance. 
The estimates were made on a model covering all the country, whereas 
assistance under Objective 1 covers only a part - albeit large - of the 
Spanish territory and economy. Therefore, the calculated macroeconomic 
impact will be lower than that calculated for the other Objective 1 
countries. 
The results show that, over the period 1989-93, as compared with the 
scenario without a CSF, there will be an annual acceleration in growth 
of about 0.3%. The cumulative effect over five years will mean that in 
1993 GDP In Spain will be 1.5% higher than it would have been without 
the CSF. The rate of investment will increase from 25.7% in 1988 to 
31% in 1993. 
The model also shows that the effects of the CSF investment programme, 
coupled with the current expansion of the Spanish economy, will produce 
a considerable improvement in the trade balance. 
The anticipated acceleration in growth should mean an increase in 
employment of approximately 117 000 posts over five years, representing 
an appreciable increase in the number of persons employed even though 
the impact on the Spanish unemployment rate will remain very limited. 
Furthermore, the model predicts that, without the CSF, Spain would have 
2.6 million unemployed in 1993 whereas in the same year, as a result of 
the CSF, the number of unemployed should be about 160 000 less. 
In sectoral terms and taking the economy of Andalucia as an example, 
the major boost should be to services, particularly business services 
to and public services such as education and construction. There 
should also be a significant impact on energy and agriculture. 
- 32 -
1.2.5. France 
1.2.5.1. Implementation of the CSF 
Individual CSFs were approved for each of the five regions covered by 
Objective 1. They are therefore being implemented at regional level 
only. Of these five regions, three are using the multifund approach. 
In the case of Réunion, the pre-reform IDO has been merged with the new 
multifund operational programme. It was not possible to do the same 
for Corsica, which is covered by an IMP as well as a new operational 
programme. 
The regional level of the CSFs meant that the regional partners were 
able to participate fully in the programme preparation and negotiation 
phase. This participation is continuing in the monitoring of measures, 
which is carried out at local level. 
In the regions where the multifund approach is used, all the CSF 
priorities except those relating to Objectives 3, 4 and 5(b) are being 
implemented through a single programme (Corsica, Guiana and Réunion). 
For the other two regions several programmes are required for 
implementation. Because of uncertainty over the choice of forms of 
assistance and the difficulties encountered by the authorities 
responsible for drawing up programme proposals there were delays in 
approval (end of 1990). 
The programmes for each region intended to achieve the priorities 
selected for the CSFs are designed to improve the provision of 
infrastructure to support economic activities, particularly to offset 
the considerable isolation of the overseas departments, and to 
strengthen the Job-creating productive sectors, mainly through 
investment aid and business services. The programmes for the overseas 
departments also include measures to promote cooperation with countries 
in the same geographical region. 
The priorities selected for the development of agricultural resources 
and the specific characteristics of each area explain the diversity of 
content of the measures in the various regions. 
On the whole they reflect a dual concern: to improve the 
self-sufficiency of the regions and the production of regional 
specialities, and to diversify agriculture in order to reduce reliance 
on traditional products. 
As a result of synergistic effects between the Funds, rural development 
will also benefit from the implementation of measures to diversify 
economic activity in general and to protect the environment. The 
modernization of holdings continues to be a priority. 
All the appropriations for agricultural measures provided for in the 
CSF have been mobilized. 
- 33 -
Human resource development is being implemented by means of ten 
operational programmes (three of them multifund). The programmes 
distinguish between activities falling under national responsibility 
and those falling under regional responsibility. In the case of 
measures relating to the population categories eligible under 
Objectives 3 and 4 national measures continue to predominate, whereas 
the regional authorities, except in Guadeloupe, preferred to 
concentrate their appropriations on vocational training and employment 
assistance measures to support regional development. 
The first CSF monitoring committee meetings were held in each of the 
regions and information meetings for employers and workers were 
organized in Réunion and Martinique in October and November 1990. 
1.2.5.2. Socio-economic Impact of assistance provided for in the CSFs 
The economic impact of the structural Funds in the French regions 
covered by Objective 1 has been quantified by applying a very simple 
Keynesian macroeconomic model. Principally, this has made it possible 
to calculate approximately the demand effects on GDP, imports and 
employment by the increase in investments generated by the CSFs as 
compared with a scenario without Community aid and without renewal of 
previous Community structural assistance (see model C in Annex 4). 
The estimates of the impact of the structural Funds on demand indicate 
a low investment multiplier factor for GDP (varying from 0.9% in 
Réunion to 0.3% in French Guyana), mainly as a result of the importance 
of transfers and the preponderance of the non-merchant services sector. 
By contrast the effects of the CSFs on imports are very substantial and 
significantly higher than on GDP (the impact of the CSF on imports as a 
percentage of GDP varies from 4.8% for Guyana to 1.8% for Martinique). 
The high elasticity of imports in relation to income reflects the 
particular economic structure of these regions. Although their wage 
costs are below the Community average, they are very high compared with 
adjacent, competing countries. The extreme narrowness of the markets 
and the remoteness of these regions from the main centres of activity 
of Europe all contribute to severe distortion of goods and factor 
prices, with very negative repercussions on economic and social 
development. 
While they can help offset the main obstacles which these regions 
encounter and encourage emergence of a competitive productive sector, 
the structural Funds can have a significant impact on the productive 
structure, employment and incomes only in the medium-term. 
Furthermore, the impact of the structural Funds cannot be separated 
from that of other Community policies and rules and the implementation 
of POSE I DOM. 
The impact on employment will be relatively significant with some 8 500 
new Jobs created thanks to the Community Funds. However, this will 
have only a limited impact on unemployment because of the large numbers 
out of work and the demographic trends in these regions. From a 
sectoral point of view, tourism, services and construction will should 
the most. 
- 34 -
1.2.6. Ireland 
1.2.6.1. Implementation of the CSF 
Approved in October 1989, the CSF for Ireland is being implemented by 
means of nine operational programmes for the regional development 
priorities and three operational programmes for Objectives 3 and 4. 
The OPs include major projects and aid schemes. Integrated programmes 
were adopted for the main measures relating to agriculture and rural 
development (tourism, rural development), the improvement of 
competitiveness of industry (one large multifund OP for industry and 
services) and for human resource development (multifund OP for training 
infrastructures). The measures to improve road infrastructure are 
being implemented by a large programme entirely funded by the ERDF. 
In view of the size of the OPs, special work had to be done on 
quantifying the objectives and physical indicators. External technical 
assistance was required in certain cases to make recommendations to the 
national authorities. 
Measures relating to improving agricultural resources (agriculture, 
fisheries, forestry, rural development) focus on three main aspects: 
protection and conservation of the rural environment, promotion of 
forestry (reafforestation, forest roads, support for commercial 
forestry) and rural development (agricultural diversification, farm 
tourism, farmer services, fishing ports, assistance to small 
businesses, road infrastructures in rural areas, which are part-
financed by the ERDF and vocational training). 
As regards human resources, most of the measures are targeted at 
supporting economic development. Ireland has not mobilized many 
appropriations for measures under Objectives 3 and 4 (ECU 342 million). 
Some emphasis has been placed on measures to promote secondary 
educat ion. 
Ail the planned forms of assistance in the CSF have been approved. 
Monitoring committees have been set up for each operational programme. 
Employers and workers are represented on OP monitoring committees. The 
findings of the committees indicate that the measures are being 
implemented satisfactorily. Estimated expenditure for 1990 was in the 
main respected. The take-up rates were 95.6% for ERDF measures, 99.3% 
for ESF measures and 104.8% for measures part-financed by the EAGGF. 
1.2.6.2. Socio-economic impact of assistance provided for in the CSF 
The economic impact of the structural Funds on the Irish economy has 
been quantified in very complex studies based on a series of 
microeconomic and sectoral studies linked with a macroeconomic model 
capable of integrating the main results of these studies in the overall 
impact assessment (see model D in Annex 4). 
- 35 -
The projections cover the period up to the year 2000. In order to 
assess the net contribution of the CSF to Irish growth, two scenarios 
were used: the first assumes that the flow of EEC structural Fund aid 
to Ireland will continue in real terms between 1988 and 2000 at the 
same level as in 1988. The second, by contrast, takes into account the 
increase in structural assistance between 1989 and 1993 and then 
assumes that between 1994 and 2000 the flow of funds will level off in 
real terms at the 1993 level. This exercise therefore measures the 
expansion effects of the structural policy due to the CSF as compared 
with the previous Community structural policies and not as compared 
with a situation without a CSF. 
The results show that between now and 2000 the cumulative effects of 
the CSF should generate a growth in GDP of 2.7%. On the other hand, 
the effect on per capita GDP should be much weaker, given the sustained 
growth in the Irish population and the fact that the improvement in the 
economic situation and the rosier employment prospects generated by the 
CSF should reduce the phenomenon of emigration. As a result, per 
capita GDP will increase by only 0.8% over the same period. 
The greatest contribution to growth (combined effects of supply and 
demand) will be due to the effects of investment in human resources. 
This alone will account for 50% of total growth (although it accounts 
for only 42% of total expenditure). This is followed in order of 
importance by investments in infrastructure (27% of expenditure, 22% of 
the total contribution), aid to firms, investments in agriculture and 
farm income support. 
The effects on employment should be appreciable and cumulative. From 
1989 to 1993 an estimated 19 000 stable new jobs should be created plus 
a further 12 000 between 1994 and 2000 bringing the total increase in 
net employment due to the CSF to 2.6%. On the other hand, the effects 
on unemployment will be less encouraging, since, as we have seen above, 
there should be a fall in emigration. In 1993 the number of unemployed 
will fall by approximately 16 000 units (1.3% of the labour force). 
At sectoral level, the impact of the structural policies on both 
traditional and high-technology industries will probably be fairly 
limited in the short-term. Experience suggests that effects of this 
type require a considerable period of time before they induce lasting 
changes. On the other hand, the impact on marketed services will be 
considerably more substantial and quicker. There will probably be only 
very low growth in the agricultural sector. 
1.2.7. Italy 
1.2.7.1 Implementation of the CSF 
The single CSF for Italy comprises a national section and a regional 
section. The latter is very large since more than 50% of the measures 
are managed by the regions. 
- 36 -
The pattern of forms of assistance in Italy is similar to Spain in that 
the measures falling under national responsibility are generally 
implemented in the form of monofund programmes whereas the integrated 
approach has been adopted for the implementation of the regional 
sect ion. 
Implementation of the various priorities of the CSF varies according to 
the difficulties encountered in drawing up the programmes. The 
progress of decisions is satisfactory for the priority "upgrading of 
basic infrastructure", which essentially involves major projects at 
national level. Several major projects were approved from 1989 onwards 
(natural gas supplies, water resources, telecommunications and 
industrial areas). By contrast there was a certain delay in 
multiregional measures relating to tourism and research, which were not 
approved until the end of 1990. Two large programmes, one concerning 
aid for the industrial and service sectors and the other aid to Apulia, 
still had to be approved. The total amount involved is 
ECU 612 mi I I ion. 
The mult i regional section of the CSF on agriculture lays down the 
priorities clearly: development of new crops, improvement and 
strengthening of traditional crop enterprises and development of 
advisory services. 
The regional section of the CSF centres mainly on rural development 
measures, together with support for infrastructure and environmental 
measures. 
As regards human resources, the forms of assistance mobilize the 
greater part of the funds provided for in the CSFs (ECU 1 463 million 
out of a total of ECU 1 700 million). 
Of the 27 operational programmes approved, 18 cover regional 
development and nine the implementation of Objectives 3 and 4. In 
terms of the amount of financing, the measures relating to these 
Objectives continue to dominate. 
Initial information on the implementation of these measures indicates 
that there have been some difficulties. Of course, the situation 
varies greatly from one region to the next. Of the 5 major projects, 
there has been a certain delay in implementing the natural gas project. 
As regards the ESF the content of the measures planned at regional 
level is not entirely appropriate to the basic training needs of young 
people aged 18 to 25. Some reprogramming should therefore be envisaged 
to amend the CSF. 
The first meeting of the CSF Monitoring Committee was held on 12 
December 1990 and the Italian government adopted special provisions on 
the constitution and composition of this Committee (decree of 
21 November 1990). 
- 37 -
1.2.7.2. Socioeconomic Impact of the assistance provided for In the CSF 
An input-output model and a general equilibrium model were used to 
assess the economic impact of the structural Funds for the Mezzogiorno, 
making it possible to separate the effect of the Funds on the 
Mezzogiorno from those induced in the Centre-North of Italy. Two 
successive scenarios were tested: the first without a CSF and without 
renewal of the structural measures of 1988, and the second 
incorporating the CSF (see models E and F in Annex 4). 
Thanks to structural Fund assistance, the Mezzogiorno should see a 
long-term cumulative increase in its GDP of 2%. The impact on 
employment should also be considerable: 135 000 new stable jobs could 
be created In Italy through the Funds, 85 000 of which would be in the 
Mezzogiorno. 
The estimates show that the Centre-North of Italy should also benefit 
greatly from Community structural assistance: in the implementation 
phase, when the effects on demand will predominate, impact on the 
growth of the GDP in the Centre-North in absolute terms should be the 
same as for the Mezzogiorno. The reason for this is that a large part 
of the demand for capital and consumer goods generated by the 
implementation of the structural policies in the Mezzogiorno will be 
supplied by the Centre-North and the whole of Italy will therefore 
benefit from the Community's assistance. 
In the longer term, the effects on supply in the Mezzogiorno should be 
greater than in the Centre-North of Italy (estimates indicate that 60% 
of overall effects on supply are likely to be concentrated in the 
Mezzogiorno and 40% in the Centre-North). 
At sectoral level, estimates suggest that there should be a substantial 
impact on output in the Mezzogiorno, particularly in the tourism, the 
metalworking and mechanical engineering sectors, the food sector and 
public administration. 
Consequently, if the expected synergy were to materialize, the 
development of an independent production capacity in southern Italy 
should have a lasting impact. The Mezzogiorno could then revive its 
process of catching up with Europe and the Centre-North of Italy, which 
it was unable to do during half of the 1970s. 
1.2.8. Portugal 
1.2.8.1. Implementation of the CSF 
Portugal has one CSF with a fairly large regional section. 
Implementation has been satisfactory, 49 of the 51 forms of assistance 
provided for having been approved. Appropriations for the agricultural 
section have been mobilized in full, as have those for the section on 
training. A few operational programmes, covering a total of 
ECU 111 million, still have to be approved. 
- 38 -
The multifund approach was agreed with the Portuguese authorities for a 
large number of dossiers. Some of the large national programmes based 
on a sectoral approach (PEDIP, PRODEP) use ERDF and ESF appropriations. 
At regional level the multifund approach is used almost exclusively to 
implement the priority "development of indigenous potential". 
It is also used for the nine industrial conversion and restructuring 
measures (Priority 5) in the Setubai Peninsula and the Vale do Ave 
(PROAVE). 
As regards the development of agricultural resources, the PEDAP is of 
particular importance and the majority of EAGGF appropriations are 
being used to implement it. 
Agricultural measures in Portugal are being implemented almost 
exclusively at national level. Although a few regional multifund 
operational programmes provide for EAGGF participation, it is on a 
smalI scale. 
As regards human resources, only one technical assistance programme 
still had to be approved on 31 December 1990. Forms of assistance 
covering ECU 1 678 were approved in 1990 (34 OPs have been approved, of 
which 21 were multifund, three IDOs and one PEDIP). If the ECU 339 
million for 1989 ESF commitments is included in the amounts for these 
forms of assistance, almost all the funds in the CSFs have been 
approved. Under these programmes the ESF will contribute to measures 
to raise skill levels as required for the CIENCIA programme, and also 
to major measures to raise the general level of education. There is 
also a third priority of importance to Portugal, the improvement of 
training structures. The ESF provides assistance for training to 
accompany the development of productive investment through PEDIP, a 
programme approved before 1 January 1989 but to be implemented in the 
period 1989-93. 
The CSF and the forms of assistance are monitored by various 
Committees. One Committee has been set up for each of the programmes 
approved. This structure, completely new in Portugal, was introduced 
by Decree-Law on 12 April 1990. 
Thus, by the end of the first two years of implementation, most of the 
forms of assistance have been approved. 
As regards the execution of the 1990 instalment the note of expenditure 
stands at 64%. 
1.2.8.2. Socio-economic impact of the assistance provided for in the 
CSF 
An initial estimate of the socioeconomic impact of the Portuguese CSF 
has been made using input-output analysis techniques (see model H in 
Annex 4). 
- 39 -
The first results suggest that, if Community transfers had stayed at 
the same level as in 1988, Portuguese GDP in 1993 would be at least 2% 
lower than the figure which will be achieved following the reform of 
the structural Funds. This result is all the more positive in that for 
the past few years Portugal has had a relatively high rate of GDP 
increase. 
The impact of the CSF on the overall economic situation is likely to be 
minor: there will be a boost in imports (about +4% per year) and some 
inflationary pressure is likely, but if the Portuguese economy 
continues to become more dynamic and international, these imbalances 
should not pose serious difficulties. 
The impact on employment should be considerable. During the five year 
period of the CSF about 70 000 new jobs should be created. 
Unemployment should fall from 5.6% to 5.2% - very low in comparison 
with the Community average. 
A second estimate of the impact of the Portuguese CSF has been made 
using a general equilibrium model in which the supply effects generated 
by the CSF can be integrated. The scenarios analyse the development of 
the Portuguese economy with and without Community assistance (see model 
G in Annex 4). 
The results indicate that the acceleration in growth should be around 
0.4% per annum in the '90s resulting in accummulated additional growth 
between 1989 and 2000 of 4.9%. In the long term, as a result of the 
full attainment of the supply effects, the acceleration in growth 
should increase further and rise to 0.6% of GDP. Community assistance 
will have a positive effect on the investment rate, which towards 2000 
should be 3.5 points higher than the scenario without a CSF (28.5% as 
against 25%). 
Finally, the structural Funds should have a major multiplier effect, 
not only on national investment but also on foreign investors, with an 
increase in foreign financing in relation to the GDP. 
At sectoral level, besides the likely changes in agricultural and 
industrial processing, where foreign investment provides a good 
indicator, the CSF appears to be establishing a context in which new 
capacity will be created in the fisheries, public works, tourism and 
advanced sectors, particularly those concerned with new information 
technologies. 
1.2.9. United Kingdom 
1.2.9.1. Implementation of the CSF 
Northern Ireland has one CSF, approved in October 1989. It Is being 
implemented by means of seven operational programmes for the 
Objective 1 priorities and two programmes for the Objective 3 and 4 
measures. 
- 40 -
In spite of some difficulties in submitting the programmes, all the 
appropriations provided for in the CSF have now been approved. 
With the exception of measures to promote tourism and industrial 
development, which are being financed by both the ERDF and the ESF, all 
the priorities are being implemented by monofund programmes. 
Joint measures are being implemented by Northern Ireland and the 
Republic of Ireland in order to reduce the effects of their 
peripherality. Thus, the transport programme approved in 
Northern Ireland is linked explicitly to the corresponding programme 
being implemented in Ireland. A further example of cooperation is 
tourism, where Joint tourism promotion initiatives have been 
undertaken. 
The agricultural measures already taken under Regulation No 1942/811 
are continuing. The new OP extends the field of application of the 
specific programme launched in 1981 to the whole of Northern Ireland 
and the negotiations on content led to an extension of the range of 
assistance. 
As regards human resources, six forms of assistance, four of which are 
operational programmes, have mobilized all the appropriations provided 
for in the CSF. There is an ESF contribution towards measures to 
promote industrial development and tourism. However, its main 
contribution continues to be towards measures to combat longterm 
unemployment and to encourage the vocational integration of young 
people (Objectives 3 and 4). 
Monitoring of the CSF and the operational programmes is under way. All 
the Committees were set up in 1990 or early 1991. 
The findings of the Committees make It possible to assess the progress 
of actual implementation. The implementation rate of expenditure from 
the tranches for 1989 and 1990 accounts for 75.8% of programmed 
expenditure. 
1.2.9.2. Socio-economic impact of the assistance provided for in the 
£S_E 
For the moment it is not possible to quantify the economic impact of 
the structural Funds in Northern Ireland. It has, however, proved 
possible to arrive at a qualitative analysis of Community structural 
policies by analysing the productive structure of the region. 
This has shown that the productive structure is heavily influenced by 
the extent of public subsidies, which account for approximately 65% of 
income in Northern Ireland. The industrial structure in particular is 
weak, often undynamic and uncompetitive and tends to specialize in the 
most traditional and least innovative sectors. 
1 0J No L 197, 20.7.1981. 
- 41 -
As a result, Community assistance can make a major contribution towards 
modernization of the industrial structure, training of a skilled and 
productive labour force and reduction of transport costs. Its 
contribution could be far greater if, through a multiplier effect, it 
succeeded in stimulating a competitive and job-creating private sector. 
However, for the moment this effect on private investment appears to be 
very Iimited. 
It is important to remember that Community part-financing represents 
only a small proportion of public expenditure in Northern Ireland. In 
addition, some development opportunities, such as tourism or inward 
investment, may be sensitive to a negative perception of the region's 
political situation. Furthermore, the region is small and its economy 
is open, which makes it all the more difficult for the Community to 
contribute significantly to its development. 
- 42 -
CHAPTER 3 - IMPLEMENTATION OF THE OTHER OBJECTIVES 
1• Objective 2 
It should be noted that Objective 2 concerns nine Member States, as the 
whole of Greece, Ireland and Portugal are eligible under Objective 1. 
With some exceptions (Spain), 54 CSFs were approved in December 1989 
and cover the three-year period 1989 to 1991; by the end of 1991, new 
programmes will have to be drawn up for the second phase, 1992-93. 
1.1. General overview 
The fact that the CSFs for Objective 2 had to be implemented within 
three years meant that all the partners had to work on submitting 
operational programmes as quickly as possible. 
1.1.1 Difficulties encountered by the Member States 
For a variety of reasons, including programming experience, a CSF 
structure defined from the outset at the regional level, and the fact 
that conversion strategies were already under way in the Member States 
concerned, most of the areas eligible under Objective 2, unlike the 
Objective 1 regions, succeeded in submitting operational programmes 
quickly. Some countries submitted draft OPs at the same time as the 
CSF, sometimes even before the CSF had been formally approved. The 
Spanish OPs, exceptionally, were submitted after approval of the CSF, 
on 14 March 1990. 
A particularly significant problem arose with regard to the content of 
the measures and their consistency with competition policy. As a 
result of the regional policy guidelines adopted and implemented in the 
course of negotiation of the CSFs, more stress has been placed on 
improving the competitiveness of firms than on large-scale basic 
infrastructures. Putting these guidelines into practice in terms of 
the content of measures led to the submission of a large number of 
regional aid schemes. 
In several countries (Germany, Spain, France and Italy) the aid schemes 
submitted were new or had not yet been notified in advance to the 
Commission. Examination and approval of these aid schemes delayed the 
approval of the operational programmes concerned. In a limited number 
of cases, the Commission preferred temporarily to suspend the measure 
rather than hold up the approval of the programmes themselves. 
1.1.2. The multifund approach 
When the CSFs were prepared, ways of generating synergy between 
different forms of assistance were sought. CSF priorities involving 
both the ERDF and ESF incorporated assistance from both Funds and 
measures existing before the reform were often implemented as IMPs 
(France) or IDOs (France, Germany, Netherlands, Belgium, United 
Kingdom), which already combined the two Funds. 
Most of the forms of assistance approved were of the monofund type (see 
Part One) and the multifund approach to implementing the CSFs was 
adopted only rarely, although some countries used it in part (3 MOPs in 
Germany, 1 in France, 7 in the United Kingdom and 2 in Denmark). 
- 43 -
The Commission clearly expressed its wish to see this approach 
developed where appropriate during negotiations for the second phase of 
Objective 2 in order to extend the existing synergies at CSF level. 
The predominant form of assistance is the operational programme. In 
general, major projects above the threshold laid down in the rules were 
approved i nd i v i dua11 y. 
It should also be noted that, even where the forms of assistance are 
not combined, a single integrated Monitoring Committee under the CSF is 
responsible for coordinating measures under the ERDF and the ESF. 
Implementation is at regional level, including in Spain where a single 
CSF is implemented through a series of regional operational programmes. 
1.1.3. Results of implementation In terms of appropriations mobilized 
This section is concerned with implementation of measures anticipated 
in the CSFs. As in the case of Objective 1, ESF commitments for 1989, 
amounting to ECU 238.6 million, were decided during that year. 
Apart from some forms of assistance, all the operational programmes 
required to implement Objective 2 were approved from the beginning of 
the reform. 
Taking new and ongoing measures together, assistance granted under the 
CSFs at 31 December 1990 was as follows: 
(ECU million, 1989 prices) 
MEMBER STATE 
BELGIUM 
DENMARK 
GERMANY 
SPAIN 
FRANCE 
ITALY 
LUXEMBOURG 
NETHERLANDS 
UNITED KINGDOM 
TOTAL ERDF 
Amount 
est imated 
145.0 
22.4 
249.0 
576.0 
515.0 
179.0 
15.0 
57.0 
1 159.0 
2 917.4 Amount 
approved 
145.0 
22.4 
250.0 
558.0 
501.0 
161.0 
3.0 
49.0 
1 119.0 
2 808.4 ESF 
Amount 
est imated 
50.0 
7.6 
105.6 
159.0 
185.5 
86.0 
38.2 
351.4 
983.3 Amount 
approved 
(inci.1989) 
44.91 
7.26 
105.60 
158.00 
179.00 
86.00 
38.20 
342.00 
960.97 
- 44 -
As can be seen from this table, implementation in terms of approval of 
the forms of assistance for Objective 2 has been completed for the bulk 
of the appropriations in the CSFs. Appropriations for new measures 
total ECU 2 306 mi I I ion1 
Some forms of ERDF assistance are still being finalized. These 
comprise one RESIDER OP for Spain, one RENAVAL OP for France, three 
RENAVAL OPs and three RESIDER OPs for Italy and a number of RENAVAL OPs 
for the United Kingdom. 
A RESIDER OP for Luxembourg will be approved in 1991 but the Member 
State has not yet submitted any operational programmes. One form of 
assistance in the Netherlands has still to be approved. 
1.2. Implementation of the priorities 
1.2.1. General 
This section gives a summary of the contents of the forms of assistance 
for a better appreciation of the main trends emerging at the 
implementation stage. 
In 1989 and 1990 approval was given to 109 operational programmes, 11 
major projects and three global grants in implementation of the 
priorities laid down in the CSFs. The aggregate Community contribution 
to these measures is ECU 2 297 million. This corresponds solely to new 
measures decided after 1 January 1989. 
In the Objective 2 regions the Commission sought to concentrate the 
limited funds available on measures to create employment in place of 
Jobs lost as a result of industrial decline. The funds were channelled 
primarily into measures to provide training in new skills for workers 
made redundant and measures directly associated with job-creating 
productive activities. 
Almost 26% of Community assistance in 1989-91 was spent on training 
measures. Most of the appropriations were allocated to monofund 
programmes covering priorities defined in the CSFs. 
Support for measures directly associated with productive activities 
represents 21% of all the assistance. Support took the form of 
investment subsidies in the industrial and service sectors and measures 
to promote business services. These types of measure account for a 
large part of all the Objective 2 programmes, especially in countries 
such as Germany and Denmark, where they use more than 40% of the 
appropriations. In Belgium the corresponding percentage is 50%. 
Support for infrastructure essential to the growth of new economic 
act ivies also occupies an important place in the programmes. In most 
cases the operations entail financing of fully serviced new sites for 
industry or the rehabilitation of old sites. According to the figures 
in the programmes, Community assistance should represent 
ECU 460 million, or 20% of all new measures and 27% of ERDF 
appropr iat ions. 
1 Cf. Annex I.4 of first Annual Report. 
- 45 -
Operations of this type, already financed by the Community before the 
reform, represented less than 20% of available appropriations. The 
present figures show the distinct trend towards this type of 
investment. 
Measures contained in OPs concerned with environmental protection can 
also be included in this category, as they are concerned with 
rehabilitation of industrial wasteland, although not always for the 
purposes of industrial re-use. Environmental protection measures, 
which come in for 9% of Community aid, include aid for the recycling of 
industrial waste and measures to control pollution. 
Subsidies granted for transport infrastructure continue to enjoy a 
fairly important place in the OPs for Objective 2, accounting for 
almost 14% of all the appropriations (ECU 316 million). But this aid 
is mainly concentrated in Spain and the United Kingdom, where measures 
of this type use up 30% and 21% of Community aid respectively. In 
overall terms, the share of aid channelled into transport 
infrastructure has dropped considerably in relation to the pre-reform 
situât ion. 
Support for tourism-related measures takes ECU 170 million of Community 
assistance, or 8% of the available total. This priority features 
prominently in the Netherlands and United Kingdom (15% of the 
appropriations). In global terms, the situation is not very different 
from the situation before the reform. 
The remainder of the appopriations (4%) is allocated mainly to 
investments in training infrastructure in France and Spain. Under the 
French programmes 8% of all the appropriations is used for this 
purpose. 
The general conclusion to be drawn from the figures is that, for 
Objective 2, Community assistance is being focused on a smaller range 
of types of investment compared with the situation prior to the reform. 
1.2.2. Changes noted at the monitoring stage 
During implementation and monitoring of implementation, some changes 
were made to the original programming of the CSFs. 
In Germany the changes brought about by unification necessitated 
substantial amendment of the CSF and OP for the City of Berlin. 
Following submission of the changes to the Monitoring Committee and the 
opinion of the Advisory Committee on the Development and Conversion of 
Regions given on 28 November 1990, the Commission the approved 
amendment of the Berlin CSF on 20 December 1990. This introduces a 
revised breakdown of ERDF resources among the various priorities for 
assistance in order to make Berlin more attractive and the introduction 
of a new priority to encourage the restoration of physical links 
between the two parts of the city. This Involves no extra Community 
contribution nor extension of eligibility, since only western Berlin is 
eligible under Objective 2 while eastern Berlin is covered by the CSF 
approved for the new Lander. 
- 46 -
In Spain the changes made during implementation have led to 
considerable ERDF budget transfers between the priorities of the 
multiregional sub-framework. These entail increased assistance for the 
establishment and development of productive activities (Priority 1) at 
the expense of, in particular, support for measures to promote research 
and development and training facilities. 
Implementation has also involved an increase, as compared with the 
original breakdown, in the share of part-financing of assistance borne 
by local authorities. 
In Italy under the CSF for Piedmont, the lack of local submissions of 
schemes under the CSF priority "business support structures" will 
result in a transfer of ESF funds to the priority "innovation in 
technology, research and development". This change has already been 
incorporated in the OPs with the agreement of the Monitoring Committee 
concerned. 
There have been no significant changes in implementation of the CSFs 
for the other countries concerned. 
1.3. Assessment of the Community Support Frameworks 
Work to assess the potential economic impact of Community assistance 
has begun in a representative sample of 15 of the sixty areas eligible 
under Objective 2. These were selected from the nine Member States 
involved on the basis of a set of criteria designed to encompass a wide 
variety of situations. Besides the amount of Community aid, the 
criteria were designed to select areas particularly hit by the size of 
declining sectors and old industries, the high level of job losses in 
industry and the impact of a particular geographical location (frontier 
areas). 
Although the impact analyses were carried out by different groups of 
independent experts, they led to similar conclusions: 
The concentration of Community assistance on geographically small areas 
(NUTS level III or smaller), often with no reliable statistical 
indicators, and the marginal level of Community grants as compared with 
national public expenditure in those areas makes attempts to measure 
potential macroeconomic impact at regional level impossible. 
Furthermore, most of the operational programmes studied have rather 
imprecise objectives to be achieved, which restricts the Judgments 
which can be made about the effects expected from Community assistance. 
However, quantification of the role of Community grants will be 
possible ex post by using a series of microeconomic indicators showing 
the extent of physical implementation of the objectives laid down, the 
financial resources committed and, where possible, the degree of 
satisfaction in value terms attached to achievement of those objectives 
by firms and consumers. It is nevertheless clear that, while many of 
these indicators are laid down by the Monitoring Committees throughout 
the period of implementation of the measures selected, the most 
relevant can be measured only some time after the measures in progress 
have been completed. 
- 47 -
A comparison of the costs incurred and the objectives achieved will 
permit appropriate cost/benefit analyses to be undertaken ex post. 
There is only limited scope for a quantitative ex ante assessment even 
though it is possible in some cases to evaluate the leverage effect of 
Community assistance. But a more qualitative approach can yield some 
conclusions as to whether the measures adopted are appropriate to the 
objectives sought. 
By assessing the content of programmes in the light of local 
development strategy, local needs, resources and potential, it is 
possible to evaluate their possible contribution towards the creation 
of competitive advantages specific to the target area and likely to 
enhance its development capacity. 
This approach involves consideration of the effectiveness and 
efficiency of the programming chain from the development plans prepared 
by the national authorities to the CSFs and operational programmes as 
f inalI y approved. 
In terms of economic effectiveness, stress on the creation of specific 
areas of strength (physical and.human capital) which provide the area 
with lasting competitive advantages should guarantee it sustained 
growth provided the choice of measures results in beneficial 
externalities, that is significant incidental benefits. 
For example, considerable beneficial externalities are expected from 
measures intended to correct problems in the way the local labour 
market works, to improve human resources and to develop the linkages 
within production chains, synergies between sectors and economies of 
scale. 
The overall efficiency to be expected from Community regional 
assistance will be greater the more the expected externalities are 
concentrated in the region. 
The assessment of efficiency should concentrate on whether the measures 
are appropriate to the special features of the area. This implies a 
precise analysis of its specific regional assets and the quality of 
implementation, something which relies on the active support of those 
involved local I y. 
The absence of a detailed analysis of the competitive advantages of the 
Objective 2 areas has restricted systematic application of this 
approach, but a number of examples have been worked up. For instance, 
it has been estimated that in the Nord/Pas-de-Calais region more than 
half the Community aid under the ERDF operational programme has been 
allocated to measures which meet recognized efficiency criteria for 
regional development and that a further third has been allocated to 
projects of general interest providing as much benefit to the rest of 
the country as to the region itself. As for the remainder (about 10%), 
there are grounds for believing that, taking account of anticipated 
profits, the proposed projects might in any case have been undertaken 
at the initiative of the private sector. 
- 48 
Using the same approach, analysis of the ERDF programme in Tuscany has 
demonstrated that measures offering services to firms and those 
concerning infrastructures and the improvement of sites introduce 
significant externalities by creating conditions for more balanced 
economic development. It also shows that improved coordination between 
certain actions increases the efficiency which may be expected from 
these measures. 
Similarly in the case of ESF programmes, vocational training can 
readily be seen to give rise to positive externalities which justify 
public financing. However, the incidental benefits for a region would 
be even greater if the training programmes selected were designed to 
towards sectors corresponding to the specific local point trainees towards sectors corresp 
advantages which it is hoped to develop. 
By contrast, the benefits to be derived from financing university 
schemes, for example, may spread far beyond the boundaries of an area 
if the courses developed do not correspond to the area's specific 
needs. They therefore give rise to a general externality without 
making a targeted contribution to regional development. Such measures 
should rather be included in a national development programme. 
Furthermore, measuring the externalities expected from certain measures 
permits evaluation of the return from Community assistance. Thus a 
comparison of investment aid in the European Development Pole (an area 
including French, Belgian and Luxembourg territory) demonstrated that, 
given the present value of the externalities related to Job-creation 
and the amount of the grants paid per job created, the profitable 
application of public funds appeared assured in both France and 
Luxembourg, while the rate of assistance in France could even be 
increased without risk. In Belgium, on the other hand, the return on 
public assistance appeared less certain in more than 80% of cases. 
The limited nature of these examples means that no general conclusion 
should be drawn from them. However, they are worth citing since they 
help to direct the discussion in a field notable for its methodological 
complexity and lack of information. This line of research, though much 
elaboration remains to be done, provides a framework within which a 
tool could be found for carrying out more systematic ex ante 
assessments, without losing sight of the fact that the main objective 
is to contribute to decision-making. 
2. Objectives 3 and 4 outside the Objective 1 regions 
These two Objectives cover the whole of the Community. Where the 
countries and regions are eligible under Objective 1, the measures 
approved for Objectives 3 and 4 are included in the CSF for 
Objective 1. As regards the other countries, the Commission approved 
CSFs for these two Objectives in December 1989 (eight countries) and in 
March 1990 for Spain. The nine CSFs cover the entire territory of each 
country with the exception of those parts eligible under Objective 1 
(Spain, France, Italy, United Kingdom). 
- 49 -
The planned Community contribution for the two Objectives is ECU 
4 128 000 for 1990-92, plus the share of measures under Objective 1 
(ECU 3 972 000 - see First Annual Report on the Implementation of the 
Reform). 
Details of implementation of the nine CSFs are given below. 
2.1. General 
2.1.1. Forms of assistance 
As for the other Objectives under the ESF, the forms of assistance were 
formally submitted in August 1989. Following approval of the CSFs, 
they had to be amended by the Member States, especially in order to 
match the priorities for assistance and the financial envelopes 
contained therein. 
Virtually all the forms of assistance are operational programmes. 
Global grants have been used only rarely, mainly in Germany and for 
innovative measures in Italy. 
43% of the measures relate to Objective 3 and 57% to Objective 4; this 
corresponds broadly to the forecasts in the CSF financing plans. 
By 31 December 1990, 99 forms of assistance had been approved. Two 
countries, France and the Netherlands, submitted two operational 
programmes each, one for each Objective. The other countries submitted 
and had approved a number of operational programmes (Belgium, 12; 
Germany, 27; Spain, 26; Italy, 16; United Kingdom, 8) (See Annex 5). 
Generally the Member States have preferred to submit one programme for 
each CSF pr ior ity. 
The structure chosen by the Member States was determined in the first 
place by the priorities laid down in the CSFs (e.g. United Kingdom and 
Luxembourg). 
In other countries, the large number of operational programmes is a 
consequence of the allocation of responsibilities within the Member 
State (e.g. Germany, where vocational training is partly the 
responsibility of the Lander, and Spain). 
Similarly in Belgium, the forms of assistance were structured to take 
account of the fact that six authorities are responsible for vocational 
training, with seven operational programmes submitted by the Flemish 
Community, three for Objective 3, three for Objective 4 and one Joint 
programme for Objectives 3 and 4. 
One operational programme was submitted by the Ministry of Employment 
and Labour, one by the Brussels Region, one by WaI Ionia (still being 
examined in 1990), two by the German-speaking Community and one jointly 
by the Francophone Community and the regions of Brussels and WalIonia. 
- 50 -
In other cases, the structure used was determined both by the Community 
Support Framework and by internal structures. For example in Italy: 
the number of forms of assistance reflects the number of regions 
involved in the implementation of those Objectives (13 OPs for 
Italian regions other than those eligible under Objective 1, three 
operational programmes implemented nationally, one by the Foreign 
Ministry, for migrant workers, and two by the Ministry of 
Employment. 
the presentation of the regional operational programmes is 
standardized, that is, it includes basic training for young people 
from 15 to 18 years of age, second-level training for young people 
from 18 to 25 years of age and common measures for Objective 3 and 
4, the long-term unemployed, disadvantaged groups and work-place 
training. 
Naturally, the stress placed on each of the measures in any particular 
region of Italy depends on the local demographic situation and labour 
market. 
Spain submitted a large number of forms of assistance. The structure 
of the operational programmes is uniform, comprising basic training 
qualifications, training in the new technologies, training for 
disadvantaged groups and recruitment aid. 
2.1.2. Monitoring Committees 
A Monitoring Committee was set up for each CSF, usually with 
responsibilities extending to cover the forms of assistance. In 
certain cases, besides overall monitoring there is separate monitoring 
for the forms of assistance (e.g. Belgium, where three Monitoring 
Committees for operational programmes were set up). In some cases, 
there are also monitoring subcommittees at regional level. 
Most Committees could not hold their first meetings until the end of 
1990 or the beginning of 1991. 
2.2 Implementation in terms of appropriations mobilized 
At 31 December 1990, the forms of assistance approved for each country 
were as fol lows: 
- 51 -
(ECU million, at 1989 prices) 
Amount estimated Amount approved 
MEMBER STATE in the CSFs 
Belgium 174.0 160.8 
Denmark 99.0 95.0 
Germany 573.0 553.4 
Spain 563.0 551.3 
France 872.0 871.85 
Italy 585.0 563.0 
Luxembourg 7.0 6.5 
Netherlands 230.0 229.96 
United Kingdom 1 025.0 1 013.10 
Total 4 128.0 4 045.0 
The amounts approved mean that virtually all 
can be used. Some programmes have still 
concerning technical assistance measures. the resources in 
to be approved the CSFs 
in 1991 
To the best of the Commission's knowledge, implementation rates vary 
from 77% to 90%, although these figures cannot be confirmed until it 
has considered the applications from the Member States for balances of 
the 1990 instalment, implementation will require the reprogramming of 
measures, as certain Member States (Belgium, Germany, Spain and Italy) 
have already requested. 
2.3 Main types of measure 
The forms of assistance approved correspond fairly 
priorities and financing plans laid down in the CSFs. closely to the 
For Germany 47% of the approved budgets relate to Objective 3 and the 
remainder to Objective 4. Measures to assist categories experiencing 
difficulties on the employment market (migrants, disabled persons and 
severely underprivileged young Jobseekers) are receiving 75% of the 
assistance earmarked for Objective 4. 
In Be I g i urn the operational programmes approved for the various 
administrative authorities include basic training and further training 
schemes, technological skill training, special schemes for 
disadvantaged groups and employment subsidies. 
- 52 -
A transfer is planned from the programmes for young people in risk 
groups to basic training. 
For Denmark three priorities have been identified for Objectives 3 and 
4: the first covers measures to raise the skill levels of those who 
are inadequately trained (ECU 23 million for the long-term unemployed 
and ECU 24 million for the young out-of-work), the second covers 
employment subsidies and the third groups measures for categories with 
special difficulties on the employment market (ECU 20 million for 
Objective 3 and ECU 20 million for Objective 4). 
In Spain, apart from the programmes devoted to basic vocational 
training, efforts have been focused on training in new management and 
organizational skills, with emphasis on the needs of SMEs. Assistance 
will also be granted for training of the underprivileged categories. 
For Luxembourg, of the five forms of assistance approved for the two 
objectives, one concerns new technologies (for women entering the 
employment market, under Objective 3, and for new technologies, under 
Objective 4), another concerns handicapped persons (for vocational 
training, employment subsidies, under Objectives 3 and 4), a third 
operational programme concerns direct employment subsidies, a fourth 
transnational schemes and one technical assistance. 
For the Netherlands two operational programmes have been approved, one 
for each Objective. They cover the following: 
1) basic and further training 
2) new technologies 
3) measures to help women and categories with special difficulties 
(migrants, the disabled). 
4) recruitment subsidies 
5) transnational projects. 
France has submitted only one operational programme per objective, with 
one subprogramme grouping measures to be managed by the central 
administration and another grouping initiatives by decentralized and 
regional authorities. 
For Italy, the bulk of the funding is directed towards second level 
training and training directly related to jobs in the workplace, 
particularly in order to facilitate the development and structuring of 
the sectors most advanced in national training systems. Support is 
also being provided for new forms of basic training. Finally, 
substantial aid has been approved for the most disadvantaged 
categor ies. 
In the United Kingdom, approved assistance is based on the priorities 
laid down in the CSFs: three programmes relate to Objective 3 (the 
first for basic training, the second for employment subsidies and the 
third for categories with special problems on the labour market), and 
three relate to Objective 4 (basic training, specialized training and 
vulnerable categories); finally, assistance is to be given for 
measures under Article 1(2) of Regulation (EEC) No 4255/88. 
- 53 -
As a general rule, the forms of assistance for all the countries 
correspond closely to the CSFs. Whether under Objective 3 or Objective 
4, they focus on the priorities of basic and further training, second-
level training and new technologies, and, finally, training for the 
vulnerable categories on the employment market (women, the disabled and 
migrant workers). 
2.4 Initial results of assessment of the CSFs 
The following preliminary comments may be made on the basis of the 
assessment of the CSFs: 
- The potential impact of Community aid on the problems involved in 
finding Jobs for young people and combating long-term unemployment 
depends on the relative contribution of Community funding towards the 
national employment policy effort. Although difficult to quantify, it 
is estimated that it represents between 3% and 11% of total funding for 
training and employment support outside the Objective 1 regions. 
In cases where the Community contribution represents only a small 
percentage of the Member State expenditure, the impact of the ESF can 
only be modest, given the available means of assistance encountered; in 
all these Member states, the ESF amounts essentially to a complement to 
public programmes and it can bring a substantial qualitative 
improvement to assistance provided for certain target groups. 
Where only a small share of national employment policies is part-
financed, it is impossible to require national or regional 
administrations to make a major effort of specific and differentiated 
planning. 
By contrast, in other regions, especially those which should, in line 
with the Reform regulations, be the main beneficiaries of Community 
structural action, i.e. Objective 1 regions, the ESF constitutes the 
engine of the development of vocational training. 
- Objectives 3 and 4 are clear but so large, and the problems so 
important, that it has sometimes been difficult to target the measures 
at specific categories or measures. 
- It is not always easy to distinguish, in the areas selected under 
Objectives 1, 2 and 5(b), the training and employment measures directed 
towards local development from those which are covered by Objectives 3 
and 4 (combating long-term unemployment and helping young people find 
work). 
- In short, therefore, it is difficult to evaluate the impact of 
training and employment programmes assessment methodologies are 
fairly complex, little standardised and depend on access to detailed 
data which is not always available. 
Nevertheless, a number of positive points still arise from the first 
assessments: 
- 54 -
- The ESF brings about a Community "added value" In its main field of 
activity: vocational training. By facilitating exchanges of experience 
and the spread into certain Member States of policies which have proved 
useful elsewhere, it constitutes a tool for promoting consistent 
policies of vocational training in the Member States of the Community. 
The radical change introduced by the reform is the transition from a 
project-based approach to a multiannual programming approach. The 
national and regional partners regard this as a step forward, even 
though the lack of experience of some of the parties has necessitated a 
running-in period. 
- The partnership has developed both in the context of the national 
monitoring committees and in the course of informal meetings. The 
number of bodies involved in implementation of the reform has grown, 
and the participants are adjusting to their new roles and new 
responsibilities. In most of the countries, the regional and local 
authorities are taking more part in the decision-making. 
An increasing decentralisation of the Fund: Commission services have 
given priority to regional actions considered to be better adapted to 
local needs than national provision. In some cases, ther has been a 
significant increase, compared to earlier years, of the Fund's 
assistance to vocational training measures carried out by regional 
bodies. 
The wish to establish a link between qualifications and employment has 
led to supporting certain types of measures, for example, those that 
combine alternating classroom training and enterprise-based experience. 
As a complement, and on the basis of the first results of assessment 
exercises, the Commission and the Member States are directing their 
assessment work as follows: 
1. As regards the overall impact of the assisted measures, activities 
are centered on the improvement of the qualitative aspects of 
monitoring, the preparation of ex-post assessments and the 
development of methods to estimate both direct and indirect effects 
of assistance (not just placement rates or numbers of jobs 
created). 
2. In addition to the overall assessment of CSFs, thematic evaluations 
are being carried out in relation to specific and important aspects 
of training and employment policies to identify the role and impact 
of assisted measures. This concerns, for example, certain types of 
action: recruitment incentives, vocational training promotion of 
local employment initiatives. 
Other studies seek to analyse the impact of measures on special 
groups: women, disabled people, long term unemployed people. 
Others, again, seek to clarify the methods used to improve the 
management of labour market policies e.g. systems for regional 
planning, management and assessment of training measures. 
- 55 -
In this context, technical assistance must play a major role in the 
implementation of systems to monitor and assess. This is 
particularly important in view of teh observed relationship 
between, on the one hand, the quality of measures and level of 
funding and, on the other hand, the availability of instruments at 
regional and/or local level with which to improve the diagnoses and 
the measures undertaken. 
3. Objective 5(a) 
This Objective is intended to adapt the structures of production, 
processing and marketing of agricultural and fisheries products. 
During 1990 Regulations (EEC) Nos 866/90 and 867/90 were implemented, 
as was Regulation (EEC) No 4042/89 on fisheries. 
Commitments continued to be made in the usual way for the other 
horizontal measures under Objective 5(a). 
These relate essentially to Regulation (EEC) 797/85, the revision of 
which was described in last year's annual report. The principal 
measures are intended to support investment in agriculture, the 
establishment of young farmers and, under the regime for compensatory 
payments, agriculture in the less-favoured areas. Measures relating to 
the environment, forestry and set-aside, have been applied more widely. 
As regards extensifIcation measures, however, these have only been 
applied to a limited degree up to now. 
3.1 Adaptation of structures for the production and marketing of 
agricultural and forest products 
3.1.1 Preparation of the sectoral plans and the CSFs on marketing and 
processing structures 
Regulations (EEC) Nos 866/90 and 867/90 on improving the processing and 
marketing conditions for agricultural and forest products define the 
new procedure as follows: the Member States submit to the Commission 
sectoral plans (instead of the specific sectoral programmes under the 
old aid scheme) for each product or group of products. These describe 
the situation in the sector and the investment needs of processing and 
marketing firms. On the basis of these sectoral plans the Commission 
negotiates with the Member State through the partnership mechanism the 
sectoral CSFs which set out the priorities and the available financial 
resources. 
The CSFs adopted by the Commission through the management committee 
procedure (Committee on Agricultural Structures and Rural Development -
STAR) are essential for approval of the applications for assistance in 
the form of operational programmes or global grants which the Member 
States then submit to the Commission. The OPs may be regional in scope 
and cover a number of sectors. They comprise a series of specific 
multiannual projects for which more detailed information may be 
requested regarding the investments, the origin of the supplies and any 
increases in capacity. Financial assistance from the Community remains 
subject to part-financing by the national authorities. Several OPs may 
be submitted in the course of a year. 
- 56 -
Under Regulation (EEC) No 867/90 (forest products) two sectoral plans 
were submitted by France and Greece in 1990. Under Regulation (EEC) No 
866/90, four plans were submitted (organic farming, Netherlands; wine, 
Luxembourg; crop and livestock products, United Kingdom). 
In 1990, however, the OPs were dealt with under a mixed procedure since 
Regulation (EEC) No 355/77 continued to apply to the financing of 
individual projects until the end of the year and the three OPs 
submitted, for Portugal and Greece, were adopted under the new rules. 
Two of them were multisectoral. 
During 1990 21 OPs were submitted but not adopted: 3 by Germany, 6 by 
Belgium, 7 by the Netherlands and one each by Luxembourg, France, 
Italy, the United Kingdom and Greece. 
The criteria for selecting investments in the marketing and processing 
of agricultural and forest products are laid down In a Commission 
decision and must be applied by the Member States. The conditions of 
eligibility for applications for assistance financed under the OPs are 
also laid down1. The conditions of priority eligibility and 
ineligibility are specified for all sectors and for certain specific 
ones. 
3.1.2 Implementation of the Regulations 
3.1.2.1. Structures of production 
The Commission considered and approved the national provisions 
amplifying and specifying in accordance with regional requirements the 
general criteria laid down by Community rules for the granting of 
structural aid to farmers.2 
3.1.2.2. Protection of the environment and forestry measures 
Implementation of measures to protect the environment3 is restricted 
to areas which are sensitive from the point of view of protection of 
the environment and natural resources. These areas are designated by 
the Member States and take account of maintenance of the countryside 
and the landscape. 
Farmers in such areas receive aid in return for using more 
environmentally-friendly methods of cultivation. Depending on the type 
of area to be protected, there is a wide range of cultivation practices 
such as the retention of trees and hedgerows to preserve the landscape 
and late mowing of grasslands to protect birds nesting there. Some of 
these measures involve reductions in the quantities of fertilizers and 
pesticides (or plant health products) used and limits on the number of 
head of cattle per hectare. 
Decision 90/342/EEC of 7 June 1990 on the selection criteria to be 
adopted for investments for improving the processing and marketing 
conditions for agricultural and forestry products and Regulation 
(EEC) No 1935/90 of 3 July 1990 on applications in the form of 
operational programmes for aid from the Guidance Section of the 
EAGGF. 
Regulation (EEC) No 797/85 (0J No L 93, 30.3.1985), as last amended 
by Regulation (EEC) No 3808/89 (OJ No L 371, 20.12.1989). 
Regulation (EEC) No 1609/89 (OJ No L 165, 18.6.1989) 
- 57 -
By the end of 1990 areas of this type had been defined in Germany 
(1 731 000 ha), Denmark, France, Italy, the Netherlands (47 000 ha) and 
the United Kingdom (544 000 ha). In some cases the areas are quite 
large. 
In order to extend the scope of Community legislation on the 
environment, in mid-1990 the Commission sent the Council a proposal for 
a Regulation on the introduction and the maintenance of agricultural 
production methods compatible with the requirements of the protection 
of the environment and the maintenance of the countryside. This is 
designed to: 
encourage methods of production which are less polluting than those 
current I y used; 
encourage extensive cropfarming methods; 
preserve the countryside and the landscape and prevent soi I 
deterioration and erosion-, 
prevent depopulation due to the abandonment of agricultural and 
forest land; 
encourage the training of farmers able to apply alternative 
production methods. 
The measures contained in this proposal are no longer restricted to 
certain areas but are now available to all farmers. Areas threatened 
by natural hazards or fire are, however, specifically identified. 
This proposal is still before the Council. 
Of the horizontal forestry measures, Article 20 of Regulation (EEC) 
797/85 on farmland afforestation was applied in Denmark, Germany, 
Greece, Ireland and the United Kingdom during 1990. Article 20a 
(annual premium following afforestation) was applied in Ireland and the 
United Kingdom. France, Greece and Portugal have expressed an interest 
in implementing these two measures. 
3.1.2.3. Extensif icat ion 
The Community scheme for the extensification of production is 
implemented under Objective 5(a)1. The Community grants aid to 
farmers who give an undertaking to reduce production in sectors in 
surplus. 
Extensification may be achieved either by reducing production by at 
least 20% in a sector in surplus over five years ("quantitative 
method"), or by adopting less Intensive production methods ("production 
techniques" method). It applies to beef and veal, sheepmeat and 
goatmeat, cereals, rape, sunflower seed, soya, peas, beans, tobacco, 
cotton, vegetables, wine, olive oil and certain fruits. 
Regulation (EEC) No 797/85, as last amended by Regulation (EEC) 
No 1094/88 (0J No L 106, 27.4.1988, p.28) and Regulation (EEC) 
No 4115/88 (OJ No L 361. 29.12.1988, p.13). 
- 58 -
This scheme should have come into force on 1 January 1990, at least on 
an experimental basis in the form of pilot schemes for the products 
eligible. Application by the Member States has remained fairly 
limited, being restricted to Germany, Italy, the United Kingdom, 
Belgium and France. The quantitative method has applied principally to 
cattle (about 180 000 head in all) while the qualitative method 
(production techniques) affects about 50 000 ha given over to annual 
crops in Germany. The current extensification scheme could be 
readjusted when aids for environmental protection are revised. 
3.1.2.4. Set-aside 
The aim of the scheme for the withdrawal of arable land was to restrict 
the supply of surplus products by reducing the area cultivated and 
helping farmers to adjust to the realities of the agricultural markets. 
Half the money for it comes from the EAGGF Guarantee Section and half 
from the Guidance Section. To encourage more take-up of the scheme the 
rates of part-financing were raised in 1990 to 60% for aid up to 
ECU 300 per ha and 25% for aid in the range ECU 300 to ECU 600 
per ha).1 During 1990 the scheme was implemented everywhere except 
Portugal, which is exempt until 1994. Between 1988 and 1990, some 
800 000 ha were withdrawn from production, of which Italy accounted 
for 45% and Germany for 28%. 
Following bilateral discussions with certain Member States, premiums 
were increased from the 1990/91 marketing year to make the scheme more 
attractive (United Kingdom, Belgium, France, Ireland, Spain, Greece, 
Italy). 
From 1990 special arrangements for the use of arable land for purposes 
other than growing food was introduced under this scheme. 
3.1.3 Take-up of the measures 
To the extent that the Member States have not yet submitted all 
relevant plans to the Commission, measures to improve the structure of 
the processing and marketing of agricultural and forest products are 
only in their infancy. This means that assessment has not yet become 
operat ional. 
However, on the basis of the interim report of a study on rural change 
carried out by the Arkleton Trust,2 the Commission has drawn some 
preliminary conclusions on how farmers are making use of horizontal 
measures. 
Utilization is highest in the case of compensation schemes, the most 
successful of which is the compensatory allowance, followed by the aid 
scheme for improving the marketing and processing of agricultural 
products, and investment aid at farm level. Start-up aid for young 
farmers has a particular impact in countries where national aid makes 
a significant extra contribution or where the aid is substantial in 
relation to average Incomes. 
Council Regulation No 752/90 (0J No L 83, 30.3.1990) 
Commission Regulation No 1941/90 (0J No L 174, 7.7.1990). 
Arkleton Reseach (1989) "Rural change in Europe" - First Report to 
the Commission. 
- 59 -
On the other hand, measures concerning diversification and the 
environment, which should appeal more readily to part-time farmers in 
less-favoured areas, have had practically no impact. The measure on 
environmentally sensitive areas however, came into force only 
recently. 
Under the other regulations concerning Objective 5(a) (Regulations 
(EEC) Nos 797/85 and 1096/88) the Commission examines and approves 
national implementing provisions through a specific procedure (STAR 
Committee) which, except in the case of the Objective 1 regions, does 
not involve a CSF. 
There is a special monitoring procedure for the measures via the 
Committee on Agricultural Structures and Rural Development entailing ex 
ante assessment, on the basis of implementing provisions through a 
twin-track procedure for reviewing national provisions, and continuous 
assessment on the basis of data supplied annually by the Member States 
in accordance with their obligations under the regulations or in 
response to specific requests from the Commission. 
These assessments demonstrate the success of the use of the mesasures 
in viable applications and by young farmers, as well as the benefits 
derived by countries which have applied them for some time, such as 
Portugal and Spain in order to modernise their agriculture. They also 
underline the limiting factors resulting from legislation, which is 
sometimes restrictive, and from the peripheral situation of certain 
areas. 
3.2 Implementation of the Regulation on improving the marketing and 
processing of fishery products 
Council Regulation (EEC) No 4042/89 on the improvement of the 
conditions under which fishery and aquaculture products are processed 
and marketed has replaced, as far as that sector is concerned, Council 
Regulation (EEC) No 355/77 which applies to agricultural and fishery 
products. 
Besides incorporating the common measure into the reform of the 
structural Funds, the main Community objectives are to: 
achieve a significant and lasting improvement in the economic 
competitiveness of the sector in preparation for completion of the 
Single Market and to meet greater competition from non-member 
countrles; 
help improve the basic production situation and guarantee to 
producers an appropriate and lasting share in the resulting 
economic benefits; 
take account of changes in supplies of raw materials due to the 
increasing scarcity of certain resources in Community waters and 
uncertainties surrounding access to certain fishing areas in 
international waters; 
- 60 -
contribute to market stability; 
prevent the build-up or help to reduce excess production capacity; 
encourage compliance with new Community rules on hygiene and public 
health and greater respect for the environment. 
To implement this Regulation, between March and July 1990 the Member 
States submitted sectoral plans at national level covering all problems 
in the sector. 
3.2.1. Partnership 
Bilateral negotiations as part of the partnership mechanism were held 
in October and November 1990. In three cases (Germany, Portugal and 
the United Kingdom), representatives of the regional authorities were 
directly involved in the discussions with the Commission. 
In all cases agreement was reached on the text. Two priorities were 
selected: processing and marketing. This breakdown was decided in 
order to simplify future management given that any reallocation of 
funds between priorities as compared with the original estimates in the 
indicative financing plans is subject to certain constraints. Each 
priority sets out the various measures to be taken to improve 
structures, competitiveness and marketing conditions. 
In most cases, agreement was also reached on the indicative financing 
plan. 
Some Member States stressed the dangers of unduly increasing capacity 
in the industries concerned and the overriding need not to distort 
compet it ion. 
The negotiations led to the following conclusions: 
although in general the Member States sought to secure the largest 
possible range of financial assistance in order to develop their 
industries and marketing networks, priorities concentrated on: 
compliance with future Community standards of hygiene and 
public health in the workplace and at infrastructural level; 
restructuring and modernization of poorly adapted sectors of 
the industry while avoiding the risk of creating surplus 
production capacity; 
the promotion of technological innovation and greater added 
va Iue; 
improving the returns on aquaculture products; 
those Member States with more developed infrastructures (Belgium, 
Denmark, Germany, Netherlands, United Kingdom) are able to 
concentrate on processing rather than marketing and so direct the 
bulk of the financial resources to direct support for their 
industries, which gives them an advantage over their competitors in 
other Member States, where infrastructures inevitably require 
improvement. 
- 61 -
3.2.2. Preparation of financing plans and breakdown of appropriations 
among the Member States 
The indicative financing plans were drawn up on the basis of the 
fol lowing data: 
in the case of two Member States (Greece and Portugal), the 
Objective 1 Community Support Frameworks contain explicit financial 
envelopes to be allocated to the common measure for the processing 
and marketing of fishery and aquaculture products under 
Objective 5(a) during the period 1989-93;1 
three of the integrated Mediterranean programmes (IMPs), those for 
Greece, France and Italy, include investments under the common 
measure for the processing and marketing of fishery and aquaculture 
products. Under the programme contracts, until December 1992, 
these investments must be financed by the fisheries section of the 
EAGGF, i.e. from the financial envelope laid down in the CSFs. 
This situation is due partly to delays in implementing some IMPs 
and in some cases reduces the scope for assistance to new priority 
measures. 
The indicative financing plans for the Member States partially covered 
by Objective 1 (Spain, France, Italy and the United Kingdom) are in two 
separate parts, one for the Objective 1 regions, which have to be 
linked with the Objective 1 CSFs, and one for the other areas. 
In general, the Member States have expressed a preference for 
assistance in the form of operational programmes although Portugal has 
stated that it will ask for some assistance in the form of global 
grants. 
For the other Member States concerned, the Objective 1 Community 
Support Framework includes an overall amount for EAGGF 
Objective 5(a) without specifying a figure for the processing and 
marketing of fishery and aauaculture products. 
- 62 -
The CSFs and addenda set out the planned financial envelopes for 
Community assistance in 1991-93 as follows: 
(ECU mi 11 ion, 1991 prices) 
COUNTRY AMOUNT OBJECT IVE 
1 REGIONS 
B 2.3 
DK 9.7 
D* 10.4 
E 33.6 28.4 
F 22.0 1.5 
GR 9.2 9.2 
IRL 10.0 10.0 
I 20.3 12.4 
NL 5.2 
P 14.1 14.1 
UK 19.5 2.0 
TOTAL 156.3 77.6 
* Excluding the five new Lander. 
The layout of the CSFs varied depending on the country concerned. In 
the case of the Objective 1 countries with a single CSF covering all 
forms of assistance, it was decided to conclude addenda to the CSFs 
decided on in October 1989 (seven addenda). Provisional amounts for 
such measures were entered in the CSFs, so no additional appropriations 
were required for the Objective 1 countries. 
Specific CSFs were approved for the other countries or parts of 
countries not covered by Objective 1 (eight in all). After consulting 
the Standing Committee on the Fishing Industry and, in the case of the 
Objective 1 regions, the Committee on the Development and Conversion of 
Regions, the Commission took a decision on all the CSFs and addenda 
on 11 March 19911. 
It is still too soon to draw conclusions about the operational phase of 
implementation although all the Member States have availed themselves 
of the procedures provided for in Regulation (EEC) No 4042/89, thereby 
dispensing with the transitional provisions which enabled them to 
continue using the old procedure under Regulation (EEC) No 355/77. 
Implementation of the reform of the structural Funds requires the 
Member States to undertake more programming than hitherto. Management 
of the common measure by the Commission will therefore have to 
concentrate on the smallest possible number of applications for 
financial assistance, with the Member States submitting no more than 
two operational programmes (one per priority). 
M/-N I QQ 1Q A 1QQ1 
- 63 -
4 Objective 5(b) 
On 6 and 27 June 1990 the Commission approved 44 CSFs for rural areas 
eligible under this Objective. 
The first Annual Report listed the general problems, and it is not 
necessary to repeat these here. The financial aspects relating to the 
allocation of appropriations under the Objective among the nine Member 
States concerned may be found in Annex I.6 to that Report. 
The following aspects of this Objective will be considered here: 
the main priorities defined in the CSFs*, 
progress in the forms of assistance. 
4.1 The priorities laid down in the CSFs 
4.1.1 General gui de Iines 
In order that the limited financial resources available for 
Objective 5(b) could have real impact in the regions, assistance was 
concentrated on priorities which could make a significant contribution 
towards the realisation of indigenous potential. The CSFs for the nine 
5(b) countries have in general focused on the following main 
pr ior i t ies: 
1) diversification and conversion in the agriculture and forestry 
sectors; 
2) development of other economic sectors, in particular investment in 
small and medium-sized enterprises and supporting infrastructure; 
3) development of tourism including innovation, promotion, market 
surveys, the development of tourist facilities, accommodation and 
act ivit ies; 
4) conservation and development of the natural environment; 
5) development of human resources, particularly vocational and 
management training in support of the activities implemented under 
the above priorities. 
Community support under Objective 5(b) is complementary to intervention 
under the horizontal Objectives, i.e. Objectives 3, 4 and 5(a). The 
priorities elaborated in the CSFs take into account the operation of 
these horizontal measures and have been defined in such a way as to 
promote synergy in the application of the various structural schemes. 
In the case of the EAGGF, the Commission clarified the difference 
between measures to be funded under Objective 5(a) and those for 
support under 5(b) so as to ensure a coordinated application of both 
series of measures in Objective 5(b) regions. The emphasis under 
Objective 5(b) is on the promotion of a collective approach to rural 
development and the installation and development of all aspects of 
locally based production. 
64 -
In the light of the need to adapt agricultural production to market 
conditions, a significant aim of the Objective 5(b) policies is to 
promote the diversification, conversion and reorientation of rural 
economies. In the negotiations on the CSFs the Commission consequently 
stressed the importance of prioritizing measures directed at the 
diversification and conversion of agricultural production towards non-
surplus products, including also the development of the forestry sector 
as a source of alternative income for farmers. Forestry development in 
general represents an important resource in a number of regions and its 
on-farm and regional potential as well as its environmental 
significance are reflected in the measures contained in the CSFs. 
The priorities for the development of other economic sectors, under the 
regional fund (ERDF), focus on the development of endogenous economic 
potential through, in particular, support for the development of small 
and medium-sized businesses, tourism, and infrastructure linked to the 
realisation of these and other development priorities. A premise 
underlying these measures is that rural development schemes should be 
designed to ensure a dynamic balance between the agricultural and non-
agricultural sectors. 
Tourism is identified in many of the plans as a major priority and will 
be funded as appropriate under both the ERDF and EAGGF. The types of 
measures allowed for in the plans are typically the development of farm 
or other accommodation for tourists and the provision of ancillary 
infrastructure. 
The need to reinforce Community policy on the environment in the 
implementation of all measures was stressed in the negotiations. Many 
countries' CSFs include separate priorities for the environment, in 
particular those for France, Germany, Italy and Spain. Other countries 
have integrated various environmental concerns into the design of 
economic activities under other priorities. In general close attention 
has been paid, in the preparation of the CSFs and the operational 
programmes, to the requirements concerning the environment. 
Intervention under the European Social Fund will be directed towards 
the elaboration of training programmes, in terms of both vocational and 
management training schemes underpinning the activities being 
implemented under the other priorities. 
A rough estimate of the allocation of funds per priority, on the basis 
of a horizontal classification of priorities for all CSFs, shows that 
agricultural development and diversification has been allocated the 
largest public expenditure, followed by development of human resources, 
development of other economic sectors, the environment and tourism. 
4-1.2 The role of each Fund in the priorities 
The allocation of resources among the three Funds for the period 1989-
1993 is as fol lows: 
ECU 1 103.00 million to the ERDF 
ECU 435.87 million to the ESF 
ECU 1 068.09 million to the EAGGF. 
65 -
The first point to note is that during the negotiations on the CSFs the 
Member States concentrated on measures under the ERDF, mainly because 
the regions eligible under Objective 5(b) already had considerable 
existing commitments which had been entered into before 1 January 1989 
and which would continue during the period 1989-93. Furthermore, the 
ERDF provides the bulk of the funds for tourism (ECU 150 million out of 
total planned assistance of ECU 192 million) and measures to encourage 
the development of other economic sectors, which are required to 
support investments in small and medium-sized businesses and to develop 
certain infrastructures. Appropriations for measures of this type 
total ECU 294 million, of which the ERDF will contribute ECU 292 
m i11i on. 
This allocation of appropriations between instruments reflects the fact 
that the specific concerns of rural development, particularly the 
efforts to achieve greater diversity of economic activities in rural 
communities, are comparatively new. 
The ESF is called on to support training and aid to employment in the 
development priorities selected for the ERDF and the EAGGF. Secondly, 
the synergies between the Funds have not been formally laid down at the 
level of the priorities, as was done for Objective 1, but are to be 
found rather in the implementation and content of the measures 
selected. 
4.2 Progress 
4.2.1 The forms of assistance submitted 
Following approval of the CSFs, the Commission has endeavoured to 
assist the Member States to prepare programmes through a "Guide to the 
preparation of operational programmes", which was submitted to the 
Committee on Agricultural Structures and Rural Development (STAR). 
On 31 December 1990 about 70% of the forms of assistance had been 
submitted by the Member States and 74 operational programmes were 
expected to be approved to implement this Objective. 
This result was obtained through extremely close cooperation with the 
Member States. Informal partnership meetings were held with the 
regions concerned in order to finalize the OPs rapidly. 
There are two main reasons why the number of programmes is greater 
than the number of CSFs. Since some CSFs cover several rural areas, 
the measures to be taken in each area must be distinguished and so the 
Commission has approved an OP for each area concerned. Second I y, some 
Member States have presented monofund operational programmes. 
However, the multifund approach is the one most widely used for 
Objective 5(b) and will be used by 52 of the planned 74 OPs. 
- 66 -
4.2.2 Approval of the forms of assistance 
In view of the delay in approving the areas eligible and the consequent 
late adoption of the CSFs, a special effort had to be made to begin 
implementation of this Objective. 
By 31 December 1990 five operational programmes had been approved for 
1990 (two each for Germany and France and the OP for Denmark). That 
position does not reflect the recent progress achieved in 
implementation since by 10 October 1991, 63 operational programmes had 
been approved and 9 approval decisions were in the course of 
préparât ion. 
4.3 First results of assessment 
The results available for this Objective are still too general and are 
based on a methodological study ordered by the Commission and on 
preliminary reports of CSF evaluation studies (ex ante) undertaken in 
eleven Objective 5(b) regions. 
The studies show that, in general, the CSFs and OPs correspond to the 
requirements expressed by the bodies concerned, most of them being 
included in the development plans submitted by the Member States and 
providing a basis for the CSFs. The programmes could not cover all the 
requests for assistance, given that funds are limited. A balance was 
sought between aid for the provision or modernization of infrastructure 
(regional only) and aid for investment in production and services. 
The diversity of the Objective 5(b) areas suggests that in some cases 
their entirely rural character is open to doubt, while others are 
severely disadvantaged. Some areas which might well have been eligible 
are not included at all. 
The priorities have been grouped on the basis of the measures they 
cover but frequently priorities with the same title have different 
contents. It has also been found that, while human resources and the 
environment have been given prominence, the development of services and 
the expansion of new technologies and information media are often 
neglected. Non-agricultural activities absorb the bulk of the funds 
for the private sector (36%) followed by agricultural development and 
diversification (23%) (see Annex 6). 
There appears to be no conflict between the various priorities of the 
CSFs, or at least none is evident. The side-effects of certain 
measures, particularly those concerned with the environment and 
especially the effects of the development of tourism, have not been 
invest igated. 
Participation at regional level (by public authorities rather than the 
private sector) is heavily underlined. The effect has been beneficial, 
ensuring that genuine needs, sometimes overlooked by the central 
authorities, receive attention. Such participation leads to choices 
which correspond to the needs of the local economy, and ensures better 
living conditions for the inhabitants, better use of local resources 
and less risk of a drift towards urban areas. 
- 67 -
The studies underline the need to encourage the programme coordinating 
agency to play a more determinant role and advocate the use of simpler 
and more direct instruments to achieve more effective implementation. 
- 68 -
CHAPTER 4 COMMUNITY INITIATIVES AND INNOVATIVE MEASURES 
1. Community initiatives 
1.1 New Initiatives approved in 1990 
Community initiatives are launched in the form of Commission guidelines 
inviting Member States to apply for aid for measures of special 
interest both for regional development and the Community as a whole. 
The Member States then draw up, on the basis of the guidelines, 
operational programmes tailored to the situation in the regions 
concerned. 
An initial series of initiatives was adopted by the Commission in 1989 
for ECU 2.1 billion (RECHAR, ENVIREG, STRIDE, INTERREG and REGIS). 
In 1990 the Commission approved a second series. The principle was 
decided on in the course of the year and the formal decisions were 
taken at the end of 1990 after consultation with the Advisory 
Committees referred to in Articles 27, 28 and 29 of the Coordinating 
Regulation, the Parliament and the Economic and Social Committee. The 
total amount of appropriations earmarked for these new initiatives is 
ECU 1.7 billion^1), with an extra ECU 100 million for INTERREG. 
REGEN. for which ECU 300 million has been allocated, is intended to 
promote the development of networks to supply natural gas to outlying 
regions which do not yet have the infrastructure, and to accelerate the 
linking up of gas and electricity networks in the outlying regions with 
those of the rest of the Community. This will help achieve the 
Community's energy objectives for 1995, since the introduction of gas 
will help the regions concerned to diversify their sources of energy 
while reducing their dependence on oil. 
PRISMA, to which ECU 100 million has been allocated, is to help firms 
in the least-favoured areas of the Community to make the most of the 
opportunities offered by the single market. 
Through PRISMA, the Commission intends: 
(a) to support the development of certification and testing 
infrastructures and services in the field of calibration and metrology 
in order to help firms develop a quality policy for their products; 
(b) to prepare small businesses for greater competition in the field 
of public contracts, as well as firms which used to enjoy protection 
under Article 115 of the EEC Treaty. The measures involve technical 
assistance, in particular in matters of public contracts, production 
management, quality policy and distribution methods. 
(1) See Annual Report for 1989. 
- 69 -
TELEMATIQUE, for which ECU 200 million has been allocated, will promote 
the use of advanced telecommunications services in the least-favoured 
regions (Objective 1), particularly through better access to the 
advanced services available elsewhere in the European Community. 
To this end, TELEMATIQUE steps up the efforts begun under the STAR 
programme to encourage the use of advanced telecommunications services 
by small and medium-sized firms. It is also intended to help small 
firms in Objective 1 regions to create or develop such services 
themselves. 
Emphasis will be given to the development of public telecommunications 
services able to contribute to regional development. 
Funding will focus on services rather than investment in 
infrastructure, except where this is directly linked to the promotion 
of services to which the initiative relates. 
Most Member States submitted their OPs during the sixth month. By the 
end of 1990 examination of the RECHAR programmes had been practically 
completed and the first programmes had been approved. The ENVI REG 
programmes received in November were being examined. The Commission 
estimates that decisions should have been taken on all the OPs under 
the Community initiatives by the end of 1991. 
On 18 December 1990 the Commission approved three initiatives to lend 
support to employment policies in the Member States. 
EUROFORM relates to the new qualifications, new skills and new 
employment opportunities which the single market should create 
(indicative amount available from the Community budget 
ECU 300 mi I I ion). 
NOW aims at promoting equal opportunities and vocational integration 
for women in the field of employment and vocational training 
(indicative Community contribution: ECU 120 million). 
HORIZON is aimed at improving the access of the disabled and certain 
disadvantaged groups to the labour market (indicative Community 
appropriation ECU 180 million). 
These three initiatives have certain features in common: 
In their respective fields, they should give Community added value 
to ongoing vocational training and job promotion measures by setting up 
or developing Community networks linking Objective 1 areas to the other 
regions of the Community in order to promote, in the various fields of 
- 70 -
vocational training and employment, transfers of experience to the 
least-developed regions. 
- They contribute towards the attainment of greater economic and 
social cohesion. They should strengthen economic cohesion because 
efforts will be directed mainly towards the Objective 1 regions, 
helping to reduce regional disparities. They should also reinforce 
social cohesion by encouraging the occupational integration of the more 
vulnerable categories of the workforce. 
In addition, they dovetail with several ongoing Community 
programmes: 
* EUROFORM reinforces the action taken under the FORCE and 
EUROTECHET programmes, and under the LEDA and ERGO programmes. It 
can use the networks set up under these programmes to implement and 
develop measures coordinated by them and enhance their transnational 
dimension; 
* for the NOW initiative, which covers the same area as the third 
programme for equal opportunities adopted at the end of 1990, it is 
planned to use the existing networks (IRIS, ILE) and the experience 
obtained in analysis, assessment and management; 
* HORIZON is based on HANDYNET (computerized database on the 
handicapped in various fields) and reinforces the HELIOS programme, 
part-financing pilot training and occupational retraining schemes 
not covered by that programme. In addition, as part of the fight 
against social exclusion, and in conjunction with the Pauvreté 
programme, the objective of Horizon will be to increase the scope 
for local action and set up an experience exchange network at 
Community level. 
Lastly, the purpose of the LEADER initiative, for which ECU 400 million 
has been allocated, is to introduce innovative solutions which will 
serve as a model for all rural areas through support for integrated 
initiatives submitted at local level. A further special feature of this 
initiative is the method adopted for its implementation, i.e. the use 
of a network of local action groups for rural development which may 
apply for global grants rather than having to work through operational 
programmes managed by the national authorities. 
1.2. Implementation of the Community initiatives 
Under the Community initiatives the Member States must draw up concrete 
programmes and submit them within six months of publication of the 
decision on the Community initiative in the Official Journal. 
On the whole, the Member States submitted their programmes during the 
sixth month, i.e. in July 1990 for RECHAR and in October-November for 
ENVI REG. 
- 71 -
Since decisions on the other initiatives had been taken during the 
second half of 1990, the programmes were submitted during the first 
half of 1991. 
In 1990 only one operational programme submitted by France under RECHAR 
(Objective 2) was formally approved. All the forms of assistance should 
be approved in 1991. It is therefore too early to assess the 
complementarity of action under the Community initiatives with the 
measures provided for in the CSFs. This will be done in the next Annual 
Report. 
2. Innovative measures and pilot projects 
2.1 Measures to promote Community regional development (Article 10 of 
Regulation (EEC) No 4254/88 on the ERDF) 
Implementation of the measures under Article 10 continued in 1990, 
taking into account, among other things, the discussion at the first 
informal meeting of the Ministers responsible for regional policy 
(24 November 1989). 
1990 was marked by the final ization and approval by the Commission of 
the "Europe 2000" document1, which was submitted in November 1990 to 
the Advisory Committee set up by Article 27. 
With the aid of a forward analysis of the trends of use of the 
Community land area the Commission wants to provide a reference 
framework to help the national, regional and local authorities and 
business leaders in their long-term planning choices. 
The document has opened up a debate on European regional policy, 
involving the Parliament, the Economic and Social Committee and 
regional and local authorities. The results of the consultations will 
be incorporated into the final document to be published at the end of 
1991. 
Measures to promote interregional cooperation, which began in 1989, 
cont inued. 
In 1990 there were 70 exchanges of experience under the arrangements 
launched in December 1989 in cooperation with the AER (Assembly of 
European Regions), CEMR (Council of European Municipalities and 
Regions) and IULA (International Union of Local Authorities). Special 
emphasis was placed on the participation of Objective 1 regions in this 
process. 
Furthermore, the Commission set up the scheme of regional networks to 
help the regions and urban centres to take advantage of the 
opportunities offered by the single market and to develop cooperation 
between the public and private sectors. Twelve networks were launched 
in 1990 on the initiative of the Commission. 
Ten innovative urban pilot projects have been launched covering various 
aspects of the operation of towns and cities. These pilot projects 
provide demonstration models for other regions in the Community and can 
yield 
1 COM(90) 540 final of 16 November 1990 
- 72 -
valuable inputs into future policies adopted by the Member States and 
at Community level. 
In 1990 transfrontier cooperation measures under Article 10 received 
fresh impetus from two sources: 
- the setting up of the monitoring system for transfrontier 
cooperation (Commission Decision of 27 July 1990); 
- the new Community initiative INTERREG: Article 10 of the ERDF will 
be used to support action in favour of transfrontier regions which are 
not eligible for INTERREG funds under Objectives 1, 2 and 5(b). 
2.2 Pilot schemes for rural development (Article8 of Regulation 
(EEC) No 4256/88) 
Under Article 8 of Regulation (EEC) No 4256/88, the EAGGF can finance 
pilot development or demonstration projects involving new production 
technology up to a maximum of 1% of its annual budget. 
In 1990 a total of ECU 1.5 million was committed to such schemes, 
generating an overall volume of ECU 4 million. The projects funded are 
mainly concerned with environmental protection (reduction of nitrates 
reaching the soil), dissemination of farming techniques (protein 
plants, integrated pest control) and training schemes. It is planned in 
future to expand these activities to include integrated rural 
development projects as a stimulus to new development strategies. 
2.3 Innovative schemes for the development of employment 
(Article 1(2) of Regulation (EEC) No 4255/88) 
Innovative schemes can be financed by the ESF under Article 1(2) of 
Regulation (EEC) No 4255/88. To be eligible for financing, such schemes 
must offer new approaches to vocational training interms of content, 
organization or methodology. They are meant to help prepare the ground 
for later ESF activities in a number of Member States. More generally, 
innovative schemes should be capable of supporting any initiatives for 
developing employment. 
The rules allow the ESF to allocate up to 5% of its annual budget to 
innovative schemes as well as to technical assistance, schemes 
involving both sides of industry and programmes to aid and counsel the 
long-term unemployed in seeking employment. 
This section is concerned with innovative projects only. Under various 
CSFs a number of programmes (or gloabi grants) have already been 
approved covering innovative schemes that involve teaching methods, 
career development, technology (e.g. in the field of robotics) and 
management techniques for small and medium-sized businesses. 
- 73 -
In addition, the Commission has been financing innovative projects in 
sunrise industries. These projects involve new occupations and trades, 
management skills, marketing, financial services and import-export 
operations, giving preference to the transfer of know-how to the less 
developed regions of the Community (organization of training courses, 
training of trainers, seminars to promote sharing of experience). 
- 74 -
CHAPTER 5 INTEGRATION OF THE GERMAN REGIONS AFTER UNIFICATION 
The unification of Germany was one of the most important political 
developments for the Community in 1990. It did not require lengthy 
accession negotiations because the Treaty of Rome had anticipated such 
an event and made it possible to integrate the five new Lander and east 
Berlin without amendment of the Treaty and with only very minor changes 
to the 'acquis communautaire'. 
In order to help the new Lander to reform their economies, the Council 
adopted Regulation (EEC) No 3575/901 on 4 December 1990 to demonstrate 
the Community's solidarity in a practical way. Under this Regulation, 
the Community is supporting the economic adjustment process in the 
areas concerned through the structural policy machinery and the three 
structural Funds. This Community assistance is additional to the 
appropriations approved in the context of the reform of the structural 
Funds (Article 12 of Regulation (EEC) No 2052/88). 
Since Community legislation relating to the structural Funds is now 
applicable to the new Lander, Germany submitted a development plan for 
these territories covering 1991-93 to the Commission on 19 December 
1990. 
After effective and constructive negotiations between the German 
Government and the Commission, and with the approval of the committees 
referred to in Articles 27 to 29 of the coordinating Regulation, the 
CSF was approved formally by the Commission on 13 March 1991. 
In all, ECU 3 billion (1991 prices) has been put at the disposal of the 
Community structural Funds as a contribution towards structural 
improvement in the new Lander in the period from 1991 to 1993, of which 
ECU 1.5 billion comes from the ERDF, 900 million from the ESF and 
600 million from the EAGGF Guidance Section. 
The Community's contributions are designed to facilitate the transition 
from a planned to a market economy, and one which also faces 
competition from a highly efficient economy in the western Lander that 
is likely to attract migrants from the eastern territories. This means 
not only adjusting the economic, social and agricultural structures in 
the new regions but also ensuring that general living conditions there 
provide encouraging prospects for the future. 
The following priorities have been chosen in order to concentrate 
Community support on primary needs. 
Priority 1 
Promoting business-related infrastructure 
Since infrastructures are a basic prerequisite for industrial 
development, the aim is to modernize or create appropriate 
infrastructure in the 
1 OJ No L 353, 17.12.1990, p.19. 
- 75 -
following sectors: industrial and tourist areas, local transport 
networks, energy and water supply. 
Pr ior ity 2 
Aid towards Investment in production 
The needed overhaul of the system of production in industry, the 
service sector and tourism will involve the modernization, 
reorganization and expansion of existing businesses and the creation of 
new businesses - particularly SMEs, which are the foundation stones of 
a market economy. The stress will be on creating highly skilled jobs 
and the transfer of new technologies. 
This approach will go hand-in-hand with a reinforcement of training 
schemes appropriate to the new technologies. 
Pr ior i ty 3 
Development of human resources 
The development of human resources and promotion of employment will be 
key factors in increasing productivity and incomes. This means applying 
a range of measures to improve vocational training policy. These 
measures Include course at training centres (off-firm training), the 
creation of educational establishments, the introduction of 
apprenticeship schemes, aid towards recruitment costs, training for 
vocational training teachers and aid towards the creation of self-
employed activities. 
Pr ior i ty 4 
Combatting long-term unemployment 
There is likely to be an increase in the numbers of the long-term 
unemployed. Provision therefore has to be made for aid to finance 
various measures such as new types of training, training for the self-
employed and schemes for persons have special difficulty in finding a 
place on the labour market. 
Pr ior i ty 5 
Providing Jobs for young people 
It is likely that the closure of firms will put young people out of 
work, who will then not be able to complete an apprenticeship. 
Provision is being made for some of them to continue their training by 
granting aid to create traineeships in SMEs or in vocational training 
establishments. 
Pr ior ity 6 
Development of agriculture, forestry and fisheries and restructuring of 
the food industry 
Measures to develop agriculture, forestry and fisheries and restructure 
the food industry (Objective 5(a)) are planned. The Community's aid 
will be concentrated on three goals: 
- 76 -
- a return to family-based holdings and redirection of agricultural 
output to different products; 
- granting of compensatory allowances; 
- aid towards investment in processing and marketing facilities. 
Pr ior ity 7 
Improvement of working and living conditions in agricultural areas 
Measures will be needed to achieve better working and living conditions 
in rural areas. These schemes will be an essential supplement to the 
action under Objective 5(a) to bring about a return to family-based 
farms and are the basis for diversifying agricultural activities 
including farm holidays and rural tourism. 
Pr ior ity 8 
Agriculture and the environment 
This priority covers measures to protect the environment in the 
agricultural sector. Speedy changes need to be made to farming methods 
to help re-establish an ecological balance and improve the quality of 
groundwater. The improvement of woodland and new plantings of trees 
will contribute to safeguarding the environment and enhancing landscape 
amenity. 
- 77 -
in order to ensure flexible management of funds, the allocations to 
priorities 6 and 7 wi11 be administered together. 
ECU mi I I ion 
Priorities ERDF ESF EAGGF Total 
1. Infrastructure to 
support economic 
activities 590 95 - 685 
2. Productive investment 640 35 15 690 
3. Human resources 110 360 - 470 
4. Combatting long-term 
unemployment - 90 - 90 
5. Combatting unemployment 
among young people 
(under 25 years) - 225 - 225 
6/7 Structural development 
in agriculture and 
fisheries - - 354 354 
8. Rural development, 
environment, forestry 115 50 231 396 
Technical assistance 45 45 - * 90 
Total 1 500 900 600 3 000 
* Up to 2.5% for this item is included under the priorities. 
78 
In allocating the funds among the new Lander, total population has 
served as a base as regards priorities 3, 4 and 5, while for 
priorities 1 and 2 there has been an adjustment for the size of the 
gainfully active population (industry and services) and the size of 
total population. In the case of priorities 6, 7 and 8 the distribution 
of funds has been based on agricultural area (except for woodland). The 
distribution among the new Lander is given below. 
ECU mi I I ion 
Lender ERDF ESF EAGGF Total 
Mecklenburg-Western Pomerania 177.3 80.1 151.8 409.2 
Brandenburg 239.9 103.7 132.2 475.8 
Saxony-Anhalt 268.2 114.9 122.3 505.4 
Saxony 444.0 182.8 105.9 732.7 
Thuringia 244.4 102.3 86.0 432.7 
Eastern BerI in 116.2 46.2 1.8 164.2 
Non-regional 10.0 270.0 - 280.0 
Total 1 500.0 900.0 600.0 3 000.0 
In addition to these general allocations the EIB envisages granting 
loans worth ECU 1.5 billion and the ECSC ECU 1.1 billion, and the 
provision of these loans seems to have been well-received by the 
recipients in the new Lender. It is also planned to provide aid for 
retraining workers in the coal and steel sectors (ECU 110 million are 
included in the CSF). 
- 79 -
On 26 March 1991, two weeks after the adoption of the CSF, the 
Commission approved six monofund programmes and one technical 
assistance programme under the ERDF to help create between 50 000 and 
60 000 permanent new jobs. 
The main objectives of these six programmes are the improvement of 
background infrastructure of direct relevance to businesses, support 
for investment in production and upgrading of human resources. 
The ERDF will also be supporting measures to improve working and living 
conditions in rural areas as well as the environment. To thois end, a 
series of measures are included in the programmes which are directed 
mainly towards providing incentives for private initiatives in the 
economic sector and reinforcing competitiveness and economic 
performance among SMEs. 
The remainder of the proposed measures involve efforts to widen and 
develop the middle range of firms and make them more efficient, as well 
as to improve the business environment at local authority level, with 
the emphasis on overcoming communications problems and modernizing 
hous i ng. 
On 17 May 1991, the Commission approved six monofund programmes, one 
for each of the new Lender plus one for the eastern part of Berlin, and 
a horizontal programme at federal level (Bundesanstalt fiir Arbeit, 
Bundesministerium fdr Arbeit und Sozialordnung), grouping all the ESF 
projects. These programmes are designed to improve skill levels and 
help retrain workers and to provide recruitment subsidies in connection 
with the restructuring of the labour market. Priority is being given to 
those with employment difficulties, that is women, immigrants and the 
handicapped. Over the period of implementation, some 50 000 persons 
will benefit under the various projects. 
More specifically, the measures include schemes to integrate workers 
with outdated skills, above all where their past training can be 
upgraded in the process of the changeover from present conditions to 
the new market economy. In this connection, the idea will be to provide 
supplementary training in organizing office automation and 
telecommunications. Provision is also made for schemes to prepare 
people for self-employed occupations. 
On 21 June 1991, six monofund programmes were approved for measures 
under the EAGGF covering rural development, environmental improvement 
and forestry measures. 
More particularly, these programmes aim to stem the foreseeable drift 
from the land by creating a structure within agriculture which is well-
balanced and efficient, while at the same time improving working 
conditions, housing and transport in rural areas. 
Efforts will also be made to safeguard Jobs by developing new types of 
employment and supplementary sources of income for the farming 
populat ion. 
- 80 -
The measures in this field are principally the diversification of 
agriculture, the inclusion in farming activities of farmhouse tourism 
and, lastly, the promotion of investment that will create jobs in SMEs. 
Finally, a major programme will be necessary to help improve the 
processing and marketing of agricultural, forest and fishery products. 
This key sector is of prime importance for ensuring outlets for local 
products, so that the farming sector in the new Lander can be sustained 
and developed. 
Together these programmes should lead to greater benefits from farming, 
reduced environmental pollution and an adjustment of agriculture to the 
goals of the common agricultural policy. 
- 81 -
CHAPTER 6 : THE CONTRIBUTION OF THE LOAN INSTRUMENTS 
1. PRINCIPLES 
Article 5 of the Framework Regulation (2052/88) outlines the 
principle that assistance from the Structural Funds should be 
combined with that of the EIB and the other Community lending 
instruments (in practice the ECSC) in order to maximise the stimulus 
provided by the budgetary resources. Article 3 of Regulation 4253/88 
goes on to call for coordination and consistency between assistance 
from the Funds and support from the loan instruments. It provides for 
joint financing of individual investments by the loan and grant 
instruments. This Regulation also calls for the EIB to be involved in 
the preparation of the CSFs, and for the indicative financing plans 
of each CSF to specify allocations from the EIB and the other loan 
instruments (Article 8). 
The framework for integrated action was further defined by the 
Commission in a Communication*) calling in a regional context for a 
new emphasis by the loan instruments on concentration, programming 
and efficiency. Concentration was to involve a reinforcement of the 
priority given to regional development, and within that a new 
emphasis on Objective 1, 2 and 5b regions. Programming was to be 
reflected in the integration of the loan instruments into CSF 
financial plans-, Efficiency would mean greater emphasis on follow-up 
and ex-post evaluation. 
2. THE EXPERIENCE OF THE FIRST TWO YEARS 
The experience of the first two years enables some preliminary 
Judgments to be made about the translation of these principles into 
practice. The EIB and ECSC are each considered separately. 
2.1. The ElB's Contribution 
2.1.1. Concentrât ion 
During the two first years of the implementation of the Reform total 
EIB lending to assisted areas1) amounted to 14.5 milliard ECU. This 
was equivalent to nearly 63 % of total EIB lending activity. 
Table 1 shows that some 85 % of lending to assisted areas went to the 
regions eligible for Structural Fund assistance (Objectives 1, 2 and 
5b), a further 4 % to regions otherwise supported by the Community 
(IMPs, IDOs, etc.), 3 % to nationally assisted areas and the 
remainder to projects which cannot be allocated to individual 
intervention areas. Objective 1 regions accounted for 47 % of the 
Bank's total regional lending-, Objective 2 and 5b regions for 38 %. 
*) COM(88) 244 final of 23.12.1988 
1) i.e. Lending under Article 130 a of the EEC Treaty covering 
Objective 1, 2 and 5b regions, regions eligible for other 
Corrrrunity assistance (IMPs etc.) and those covered by national 
82 -
In 1990 there was a slight fall in the share of lending to Objective 
1 regions, which hardly grew in absolute terms, and a rise in the 
share of lending to Objective 2 and 5b regions. This followed a 
similar trend in the previous two years, which may have been 
accentuated by the recession. Figures for the first half of 1991 
suggest that the trend is now being reversed, but Objective 2 and 5b 
regions will remain in relative terms substantially more important in 
the Bank's portfolio of loans than in the portfolio of activity of 
the ERDF: 
TABLE 1 
CIB: Direct Loans end Allocations fro« Global Loans 
(HECU) 
T_ot a I 
^ejj i on a I Dt vt I opment 
Zones 1/2/5b 
1 
2/5b 
Spec. Cty. Actions/IHP (1) 
national Aid Zones (2) 
Hon - a t t ribut able 1986-88 
2J_ IS? 
12 405.9 
10 877.5 
7 239.6 
3 637.9 
600.9 
295.3 
650.2 100 
59 100 
88 
59 
29 1989-90 
23 093.3 
14 510.5 
12 330.9 
6 822.5 
5 508.A 
613.4 
A79. 3 
1 086.9 100 
63 100 
85 
47 
38 
Total 
Rcj^onal Development 
Zones 1 /2/5 b 
1 
2/5b 
Spec. Cty. Actions/IHP (1) 
National Aid Zones (2) 
Non-attributable 1989 
10 919.1 
7 071.0 
6 052.3 
3 392 
2 659 
317.7 
222.9 
478. 1 100 
65 100 
86 1990 
12 174.2 
7 439.5 
6 278.6 
3 429.9 
2 848.7 
295.7 
256.4 
608.8 100 
61 100 
84 
46 
38 
(1) Zones covered by "Specific Community Actions' 
(2) Zones covered by national aid regimes. IMPs 
- 83 -
2.1.2. Links to Community Support Frameworks 
In the case of Objective 1 regions the CSF financing plans 
included estimates of possible EIB lending, broken down in some 
cases by priority axes. In the case of Objective 2 and 5b 
regions, where global loans were expected to be the main 
mechanism of EIB finance linked to the CSFs, no quantitative 
estimates were made and a pro memoria entry alone was provided. 
Even where quantitative estimates were included it was made clear 
that the actual volume of loans would depend on the projects 
submitted by promoters with the agreement of the competent 
national authorities and approved by the EIB and the Commission. 
The CSFs for Objective 1 regions estimated lending over 5 years 
of 8.1 milliard ECU (1989 prices) linked to the CSFs. Almost all 
of this represented EIB lending. 
The figures for 1989 and 1990 show cumulative EIB loan signatures 
of already some 5.9 milliard ECU (current prices)1^ to projects 
in Objective 1 regions assessed by the EIB to be linked to the 
axes of the CSFs. In addition, some 2,021 MECU of loans linked to 
CSFs were signed in Objective 2 and 5b regions (Table I at 
Annex). These figures cover both Joint financing operations with 
the Structural Funds and lending to projects within priority axes 
which are not in receipt of Structural Fund finance. 
On this global measure the offers of loans included in the CSFs 
appear from these figures to be meeting with a satisfactory 
response. 
The picture is more variable, however, if the performance 
relative to CSF estimates is examined country by country: 
(a) the total lending figures are dominated by Italy (2.6 
milliard ECU or 45 % of total Objective 1 loan signatures). 
Absorption in the framework of the Italian CSFs has 
proceeded at a much faster rate than estimated when the 
CSFs were established; 
(b) the pace of absorption relative to CSF estimates ranges in 
the other Member States from 70 % in Spain, 58 % in 
Ireland, 48 % in Portugal to 28 % in Greece. 
In absolute terms moreover some of the figures are particularly low. 
The volume of EIB loans in Ireland is actually below that of Greece 
which is only 29 % of that of Portugal. Lending to Portugal, on the 
other hand, is significantly higher than that to Spain. The reasons 
for these absolute and relative differences are considered below. 
1) 4.6 milliard in direct loans, 1.3 milliard global loan 
-84-
2.1.3. Project Characteristics 
The largest volume of EIB lending linked to the CSFs has been in the 
form of direct loans to infrastructure projects. Support for industry 
has come largely through the provision of global loans to SMEs. The 
infrastructure loans have been focussed on four main kinds of 
project, mostly revenue-earning: telecommunications, transport, water 
and sewerage, and energy. This can be seen most clearly in the case 
of the three countries which have total Objective 1 status, Greece, 
Ireland and Portugal. 
Some of the specific projects involved are listed in the box below. Many of 
these projects have also qualified for grant aid from ERDF. 
EIB-Supported Projects in Objective 1 Countries - examples 
Greece PPC Transmission Lines and 
Electricity Distribution 
Greek Towns Sewerage 
Thessalonika Roads, Korint 
Tr ipoli Road 
Athens-Katerini Motorway 
Megalopolis Power Station 
& Lignite Mine 
Ireland Athlone By-Pass 
Irish Telecommunications 
Dundalk Water Supply 
Portugal : Lisboa Norte-Sul Highway, 
Brisa Motorway (I Il + IV) 
CTT Telecommunications 
Electricity Transmission 
Financing of Glass and 
Chemical Industries MECU 
Total cost 
56.97 
205.60 
218.75 
302.20 
1182.86 
51.40 
196.40 
32.83 
432.00 
848.00 
86.70 EIB Loans 
28.3 
22.8 
4.4 
19.7 
82.8 
4.6 
45.6 
6.2 
87.9 
82.8 
33.9 
Source : EIB Annual Report 1990 
* Loan tranches signed in 1989+1990. In most cases there will be 
further tranches in subsequent years. 
In relative terms global loans have been more important in Objective 
2 and 5b regions than in Objective 1 regions. In these regions a 
significant share of global loans has been allocated to 
infrastructure rather than industrial projects. (Tables 2 and 3). 
TABLE 2 
GLOBAL LOANS - ALLOCATION BY SECTORS 
(kCCU) 
1989 ft 1990 GLOBAL LOANS ALLOCATION 
REGIONS 
Objective 1 
Objective 2. 5b 
Total INFRASTRUCTURE 
1989/1990 1990 
145.6 81.0 
402.3 220.1 
547.9 301.1 INDUSTRIAL 
AGRICULTURAL 
SERVICES 
1989/1990 1990 
1.147.4 543.5 
1.083.7 524.9 
2.231.1 1.068.4 TOTAL 
1989/1990 1990 
1.293.0 624.5 
1.486.0 745.0 
2.779.0 1.369.5 I inked to CSF 
1989/1990 1990 
1.293.0 624.5 
1.083.7 524.9 
2.376.7 1.149.4 
I I 
oo 
I 
TABLE 3 
EIB: Direct loons and allocations from Global Loans 
(l^€CU) 
Dlrect 
Loans 
AIlocat. 
from 
G. Loans 
TOTAL Regional Development 
1989/90 1990 
11 174.0 5 733.5 
3 336.7 1 706.1 
14 510.7 7 439.6 Objective 1/2/5b zones 
1989/90 1990 
9 552.1 4 909.3 
2 779.0 1 369.5 
12 331.1 6 278.8 Objective 1 zones 
1989/90 1990 
5 529.6 2 805.6 
1 293.0 624.5 
6 822.6 3 430.1 Objective 2/5b zones 
1989/90 1990 
4 022.5 2 103.7 
1 486.0 745.0 
5 508.5 2 B48.7 oo 
a-
i 
- 87 -
2.1.4. Complementary and Joint Action 
Tables Il-V (Annex) look in more detail at EIB lending in the form of 
direct loans, distinguishing between total direct loans to the 
regions covered by the Reform, loans linked to CSFs and loans 
involving specifically joint financing with ERDF. It should be noted 
that these figures cannot be precise, depending as these do on 
Judgments about the allocation of particular projects to CSF 
priorities (see general note to tables). But they give a clear enough 
picture of the trends, notably: 
- In most countries there is a very heavy concentration of EIB 
regional activity in Objective 1, 2 and 5b regions. Only in three 
countries (Denmark, Germany and France) does lending to nationally 
assisted areas remain of significance. In France and Germany in 
particular this reflects the relative importance of such areas in 
terms of size and population. It should be noted, however, that the 
share of lending to Community regions in these three countries may 
be somewhat understated because of the practical difficulties in 
making precise estimates of the regional breakdown of global loan 
commitments, notably where small regions are concerned. 
- In the three countries that are wholly eligible for Objective 1 
assistance (Greece, Ireland, Portugal) there is a high level of 
correspondence between total EIB lending and lending linked to CSF 
priorities (this is a little less clear-cut in the case of Ireland 
than that of the other two). This is also true of Spain, where some 
91 % of total lending in Objective 1, 2 and 5b regions is assessed 
to be linked to the CSF priorities. This is all the more striking 
in view of the fact that one-third of this lending is in Objective 
2 and 5b regions. 
This correspondence is much weaker in the case of Italy and 
strikingly less so in the case of the United Kingdom (24 %) and 
France (1 %), where Objective 2 and 5b regions predominate. This is 
explained in part by the general absence of grant aid for 
infrastructural investment in Objective 2 and 5b CSFs, while, as 
noted earlier, an important share of global loans from EIB in these 
regions have been allocated to infrastructure. In this sense the 
EIB loans to Objective 2 regions can be seen as complementary to 
the CSF priorities, while in Objective 1 regions the level of joint 
operations is much higher. 
- This is suggested also by the figures on joint financing (projects 
which receive both EIB loans and ERDF grants). For the three 
Objective 1 countries, a relatively high level of lending has gone 
to CSF projects In receipt of ERDF grant (63 % of CSF-I inked 
projects in Greece, 70 % in Portugal, 56 % in Ireland). In the 
United Kingdom by contrast the figure is low and in France for the 
moment zero. One surprising feature is the low level of Joint 
financing operations in Spain both in absolute terms and in 
relation to total lending linked to CSFs (6 %) However, a number of 
loans approved by the Bank are only now in the implementation phase 
and are not included in the figures for 1989 and 1990. 
- 88 -
Analysis of the trends for 1989 and 1990 suggests that Joint 
financing operations are increasing in the three Objective 1 
countries. 
2.1.5. Constraints on the Absorption of EIB Loans 
There are some encouraging trends from the analysis presented above, 
notably with respect to the Objective 1 countries where a significant 
ex post level of joint operations can be identified. There are 
continuing grounds for concern, however, about the low absolute level 
of loan absorption in some Objective 1 regions and signs of some 
deteroriation in the situation between 1989 and 1990 (notably in 
Greece and Spain). 
Four interlinked factors have played a rôle in limiting the 
absorption of EIB loans: 
a) Constraints on indebtedness at the regional or national level. 
In Ireland and Greece increased external indebtedness has been 
discouraged for balance-of-payments reasons. In Spain regional 
authorities have been constrained by central government in 
their recourse to loan finance. Even in Italy the growth of EIB 
operations has been affected in some regions by ceilings on 
indebtedness. 
b) Some countries have relatively easy access nationally to other 
sources of long-term loan finance for regional development 
purposes and do not need necessarily to resort to Community 
loans. This is particularly true of Objective 2 regions where 
there are often we I I-developed indigenous sources of finance. 
It is less true for Portugal, Greece and even Spain, where the 
indigenous banking system is less experienced in the provision 
of long-term lending than other forms of finance and where the 
EIB is in consequence in a favourable position. 
. c) Where other sources of loan finance are available the EIB is 
not necessarily a more competitive alternative. There are 
several factors involved here. 
As a general point, the Bank is now operating in an 
increasingly complex commercial environment framed by the 
Single European Market, progress towards Economic and Monetary 
Union and increasing liberalisation and competition in 
financial services. Measures such as exchange risk cover 
schemes from which the Bank has traditionally benefited have 
been withdrawn in one Member State after another and now exist 
only in parts of Italy, Portugal, Greece and, for certain 
public sector investments, United Kingdom. 
A second factor is that in some countries (France is an 
example) schemes for subsidized loans from national financial 
institutions for regional purposes have rendered EIB 
unattractive on certain markets. 
- 89 -
Thirdly, governments have become less willing to offer their 
security for projects financed by the Bank and there has been 
increasing recourse to private sector guarantees, adding fees 
which can increase significantly the real interest rate. 
Finally, the EIB has not always been able to offer financing 
packages geared to the exploitation of important market niches: 
one examples is the provision of finance for SMEs where so far 
the Bank has only been able to offer traditional low-risk or 
risk-free loan facilities and where the recourse to a financial 
intermediary under global loan arrangements inevitably leads to 
an increase in the cost of credit as a result of the 
intermediary's management costs to SMEs, compared with that 
available to larger enterprises. 
d) In some cases the EIB involvement so far has been limited as a 
result of the degree of realisation of projects included within 
the CSFs. This is particularly true for some large 
infrastructure projects which can take several years from 
drawing-board to completion. The EIB figures given earlier 
represent tranches of finance that have been assigned and paid 
over to projects under way. In most cases there will be further 
tranches of loans to the same projects as they move towards 
completion. But the figures do not include amounts already 
authorised by the EIB Board of Directors for projects that are 
not yet off the ground. In the case of some countries there is 
a significant stock of approved projects on which loan 
contracts have not yet been completed since the projects 
themselves have taken longer than expected to come to maturity. 
This is a major factor explaining the low level of absorption 
in Greece. 
2.1.6. Programming and Evaluation 
Whereas, with some qualifications, a high degree of complementarity 
and Joint action between ERDF and the EIB has in practice been 
achieved in some countries despite these constraints, the coordinated 
ex ante Joint programming and evaluation of investment has been 
relatively limited. It has been the most successful in relation to 
some individual large projects such as Megalopolis in Greece where 
the Bank and the ERDF have been able to work closely together in the 
preparation of financing packages. But ex ante Joint programming of 
other measures has proved more elusive. 
This situation reflects some important differences in philosophy and 
decision-making procedures. The Bank remains primarily project-
orientated rather than programme-orientated and indeed the Treaty and 
its own Statutes speak for the moment only of project financing. Thus 
the Bank is unable normally to lend except to specific identifiable 
projects which can be appraised from a financial and economic point 
of view, even if the borrower can provide all the necessary 
- 90 -
guarantees1^. The exception is the signature of so-called "framework 
loans" with some public authorities for the financing of groups of 
similar projects (e.g. local roads programmes) where the individual 
projects are not known fully in advance. These operations, which were 
introduced initially before the reform of the Funds, have been small 
in number. There are, however, examples of such loans in Ireland and 
Greece (under negotiation), which are linked to CSF measures. 
2.2. ECSC Lending 
There are two main categories of ECSC lending: 
- Conversion loans (under Article 56(2)(a) of the ECSC Treaty) which 
are designed to help revitalise the areas affected by the reduction 
in activity and employment in the coal and steel industries. These 
loans normally carry interest-rebates (up to 3 percentage points) 
calculated by reference to estimated employment creation. Most of 
these loans are made through financial intermediaries in the form 
of global loans. Demand for these loans has been rising - from 304 
MECU in 1987, 452 MECU in 1988, 458 MECU in 1989 and 585 MECU in 
1990. 
- Loans under Article 54 to enterprises in the coal and steel 
industries or to investments using Community coal and steel. 
2.2.1. Programming 
While the ECSC loan instruments are sectoral rather than regional 
policy instruments the major eligibility criterion for loans under 
Article 56 is the regional location of the project within an ECSC 
designated area. The texts of the Reform of the Funds envisaged 
increased collaboration between the ECSC instruments (notably Article 
56 loans) and the Structural Funds. In order to give effect to 
improved coordination new guidelines and operational rules for 
Article 56 loans were published by the Commission in July 19902^. 
These broadened the eligibility criteria for ECSC loans in respect of 
investments carried out within specific programmes involving the 
Structural Funds. Whereas loans to individual projects wouJd be 
restricted, as in the past, to investments in the productive sector, 
eligibility for loans carried out within programmes was extended in 
addition to cover certain kinds of infrastructure projects 
(redevelopment of derelict industrial sites, large transport 
schemes), technology transfer and participation in the capital of 
innovative SMEs. Such projects would fall within Objective 1, 2 and 
5b areas. 
It was further provided that conversion loans to the latter 
categories of investment might benefit from interest rebates provided 
out of ERDF funds up to a maximum of 3 percentage points a year over 
5 years. This rebate system was to be implemented on the basis of 
partnership between the Commission, the Member State and the 
competent national authorities. The guide amounts of rebates were to 
be laid down in the corresponding Community support frameworks. 
1) In the case of global loans the Bank devolves the responsibility 
to the intermediary. 
2) OJ C 188/9 of 28.7 Idem 
- 91 -
The CSFs were negotiated before the adoption of these new guidelines. 
It has not therefore proved possible yet to explore with member 
States and regions their application, notably in Objective 2 regions, 
where the bulk of ECSC zones lie. in the CSF financing plans, ECSC 
loans were normally mentioned pro memoria only, though some 
operational programmes have subsequently included quantitative 
estimates. In its proposals on RECHAR the Commission has provided for 
a certain volume of ECSC interest-rebates on ECSC loans linked to 
RECHAR programmes to be proposed by Member States. Efforts are 
currently under way to integrate satisfactorily these projections 
into the annual procedures of the ECSC budget. 
Up to now ECSC conversion loans have continued therefore to be 
allocated outside the Community regional programmes and the 
corresponding partnership arrangements. The main choice of projects 
has been initiated by the intermediary banks handling global loans. 
Direct loans under Article 56 have also continued to be processed 
outside programming and partnership arrangements although member 
States present the individual loan applications to the Commission and 
give their support. 
2.2.2. Trends in Lending 
Tables VI - VI I I (Annex) show ECSC lending under both Articles 54 and 
56 during the first two years of the Reform. Out of total lending of 
1.66 milliard ECU, conversion loans accounted for 1.04 milliard or 
62 %. Four-fifths of Article 56 loans were located in the regions 
covered by Structural Fund interventions, all of them (except in 
Spain) in Objective 2 regions. In the case of France and of the 
United Kingdom, which alone accounts for 53 % of total ECSC Article 
56 loans, nearly 80 % of lending went to Objective 2 regions. In 
Germany the percentage was somewhat lower (63 %). 
Similarly 77 % of Article 54 loans have been allocated in the regions 
designated by the Reform of the Funds, with Italy, Spain and Portugal 
accounting together for 55 % of total allocations. 
All the Article 56 loans so far have been to the productive sector 
alone, involving a wide range of industries, commerce and services in 
the regions. None as yet has been programmed with specific CSF 
measures. 
The Article 54 loans are a mixture of investments in the steel 
industries and some major projects consuming Community steel 
(including parts of the HST network). Though falling to a large 
extent within Objective 1 and Objective 2 regions and justified on 
the basis of their contribution to other Community objectives the 
investments concerned do not necessarily fall within the 
corresponding CSFs. They can serve to support projects of European 
interest and can be seen as part of the transeuropean transport 
networks policy. 
- 92 -
CHAPTER 7 BUDGET IMPLEMENTATION IN 1990 
7.1 Concentration of ERDF resources 
Under Article 12 of Regulation (EEC) No 2052/88, the ERDF can allocate 
roughly 80% of its resources to the areas covered by Objective 1. 
In 1989 an analysis of commitments showed a substantial increase in 
allocations to regions lagging behind in their development (see Annual 
Report for 1989). 
In 1990 this share was 75.8% of resources, excluding transitional and 
innovative measures, compared with 80.6% in the previous year, calculated 
on the same basis. 
This is explained by the fact that Objective 2 (mainly) and Objective 5(b) 
(to a lesser extent) saw their share of appropriations increase because 
implementation of the CSFs gathered pace. 
The Commission still takes the view that the concentration of resources in 
Objective 1 regions should be evaluated over a five-year period, it 
currently estimates that a very noticeable increase is likely in the last 
two years of implementation. The implementing of Community initiatives in 
Objective 1 regions should make it possible to improve the concentration 
level further. 
Lastly, it should be pointed out that the actual distribution of 
appropriations between the Funds is very largely the outcome of the 
partnership discussions and that it reflects the specific needs in each 
country. 
7.2 Budget Implementation In 1990 
Following on from the 1988 and 1989 budgets, the appropriations in the 1990 
budget represented the third concrete stage towards the aim of doubling 
the commitment appropriations of the structural Funds by 1993 compared with 
1987. It must also be remembered that 1990, while being the second year of 
the reform, was in fact the first full year of implementation subsequent to 
the adoption of the majority of the Community support frameworks. 
The budget presentation of the appropriations for the structurai Funds was 
largely identical to that of 1989; a heading for combatting fraud was added 
as a "token entry" to the individual headings covering the appropriation 
for each Fund. 
- 93 -
7.2.1 Budget Implementation In 1990 bv Objective 
The general budget of the Community for 1990 included in the "remarks" 
section, as in 1989, an indicative breakdown by Objective of the 
appropriations for all the structural Funds. The table below compares this 
breakdown with the outturn in 1990. 
(ECU mi II ion) 
Indicative 
breakdown 
1990 budget Outturn 
'90 
TOTAL EAGGF 
(Guidance) ERDF ESF 
Objective 1 
Objective 2 
Objective 3-4 
Objective 5(a) 
Objective 5(b) 
Transitional and 
i nnovatIve measures 7 175.0 
1 334.0 
1 351.0 
598.0 
311.0 
414.0 6 606.2 
1 378.1 
1 368.8 
765.7 
202.4 
385.2 1 107.5 
765.7 
43.1 
57.6 3 737.9 
1 039.8 
153.1 
296.8 1 760.8 
338.3 
1 368.8 
6.2 
30.8 
TOTAL 11 183.0 10 706.4 1 973.9(1) 5 227.6 3 504.9 
Note that appropriations for Objective 1 are to double by 1992 compared 
with 1987 (Article 12(3) of Regulation (EEC) No 2052/88), and rise linearly 
from 1988 to 1992. The forecast amounts for Objective 1 regions are 
therefore as follows (in million ecu, at 1988 prices): 
1987 1988 1989 1990 1991 1992 
4 084 4 900.8 5 717.6 6 534.4 7 400 8 168 
The figure which should have been devoted to Objective 1 regions in 1990 
(at 1990 prices) was therefore ECU 7 108 million instead of the actual 
ECU 6 606 million. However, it has to be remembered that budget 
implementation in 1989 in the Objective 1 regions was greater than 
forecast, and that the 1990 under-spend was not due to redistribution 
towards other Objectives but to a general under-ut11ization of 
appropriations available in 1990. 
As a result, the funds made available for Objective 1 regions can be 
carried over or transferred so as to maintain the volume required to double 
the appropriations allocated to them and keep up the increments needed to 
attain that goal. 
(1) Figure includes schemes in the fisheries sector. 
- 94 -
7.2.2 Allocation of budget appropriations and outturn In 1990 (bv Fund) 
The commitment appropriations available and their implementation were as 
fo11ows: 
(ECU mi I I ion) 
EAGGF 
Gu i dance 
Section 
1. Appropriations 
entered in budget 
2. Appropriations 
carrled over 
3. Appropriations made 
avaiI able again 
4. Transfers 
5. Total appropriations 
avaiI able 
6. Implementation 
7. Appropriations 
not used 2.0 
2.5 ERDF 
1 700.0 5 408.0 
44.2 
61.4 10.9 
213.0 -121.0 
1 976.4 5 342.2 
1 973.9 5 227.6 
114.6 Soc i a I 
Fund 
26.0 
91.0 
-92.0 
4 100.0 
3 504.9 
595.1 TOTAL 
4 075.0 11 183.0 
72.2 
163.3 
11 418.6 
10 706.4 
712.2 
The appropriations made available again under Article 7(6) of the Financial 
Regulation (line three in the table) include ECU 71.4 million released in 
1989 from commitments made in 1987 and previous years. Strictly speaking, 
therefore, they do not form part of the doubling of the volume of the 
structural Funds between 1988 and 1993. However, the remaining balance was 
released from commitments made from 1 January 1988 onwards and counts 
towards the doubling. 
In working out how the implementation of all the appropriations was 
distributed between the three Funds, account has to be taken of the 
transfer - shown in line four of the table - of ECU 213 million to the 
Guidance Section of the EAGGF from both the ERDF (ECU 121 million) and the 
ESF (ECU 92 million) as the result of a re-evaluation during the year of 
the needs of the different Funds in the light of progress in implementing 
projects and budget forecasts. 
The rate of utilization of EAGGF Guidance Section and ERDF appropriations 
was generally satisfactory (the non-impiementat ion of ECU 114.6 million in 
ERDF funds being mainly due to delays in starting programmes under 
Community initiatives which were only adopted in principle in the course of 
the year). The under-utiIization of ESF funds totalling ECU 595 million can 
be explained by reference to the following factors: 
- 95 -
in the case of most of the CSFs, the partnership discussions have 
revealed greater preference among the Member States for operations 
financed by the EAGGF Guidance Section and the ERDF than originally 
thought when the 1990 budget was being drawn up. The result has been 
ECU 160 million more than the requirement worked out from the 
financing schedules for CSFs and Community initiatives. Of this 
amount, ECU 92 million was transferred over during the budget year; 
at the same time, ECU 68 million remained unused because of the over­
estimate of ESF appropriations. 
A total of ECU 195 million had been earmarked for implementation by 
the ESF of various programmes under Community initiatives. Decisions 
in principle on the latter were only taken during the year so the 
implementing programmes could not be submitted by the Member States 
in time for aid to be approved before 1991. 
A sum of ECU 40 million is accounted for by the fact that Member 
States were not able to send in all their operational programmes 
under the Objective 5(b) CSFs (adopted in July 1990) in time for 
approval in 1990. 
A further ECU 292 million was tied up with submissions still under 
examination at 31 December. Of this amount, ECU 20 million is 
accounted for by transitional measures (IDOs and IMPs) and ECU 10 
million by innovative measures. 
For the three funds together out of the ECU 712.2 million still unused at 
the end of the budget year, ECU 217.8 millionwas carried over under 
Article 7(2) of the Financial Regulation and has already been implemented, 
while another ECU 494.4 million has lapsed. However, the latter sum can be 
put at the disposal of the Funds again, as can any monies released from 
commitments entered since 1 January 1988. Consequently, the Commission has 
decided to propose to the budget authority that the above amount be 
transferred to the 1992 and 1993 budget years under Articles 10 and 11 of 
the Interinstitutional Agreement. 
- 96 -
The situation as regards payment appropriations is as follows: 
(ECU million) 
EAGGF 
Gu i dance 
Section ERDF Soc i a I TOTAL 
Fund 
1. Payment appropri­
ations avaiI able 
2. implementation 
3. Appropriations 
not used 1 849.5 
1 826.3 
23.2 4 564.2 3 233.9 9 647.6 
4 554.0 3 212.0 9 592.3 
10.2 21.9 55.3 
The take-up of payment commitments, for the three funds together, rose from 
96.8 % in 1989 to 99.4 % in 1990, which can be attributed in particular to 
the improvement in execution of the ESF (from 91.7 % in 1989 to 99.3 % in 
1990). 
Commitments remaining to be taken up totalled: 
(ECU mi I I ion) 
31 December 
1989 31 December 1988 
EAGGF Guidance Section 
ERDF 
Social Fund 
TOTAL 1 266.7 
7 529.0 
2 261.6 
11 057.3 1 337.2 
8 071.6 
2 539.5 
11 948.3 
It is worth pointing out that the increase in commitments remaining to be 
taken up (8%) is directly due to the doubling of commitment appropriations 
and not to a slowdown in payments. 
ANNUAL REPORT ON THE 
REFORM OF THE STRUCTURAL FUNDS 
1990 
ANNEXES 
ANNEX 1 
Meetings of monitoring committees 
for CSFs under Objective 1 
COUNTRY 
Spain 
France 
(overseas 
depts and 
Corsica) 
Greece 
Ireland 
Italy 
Portugal 
UK 
(Northern 
Ireland) NUMBER 
OF CSFs 
1 + 10 
5 
1 
1 
1 + 8 
1 
1 1990 
1 multiregional 
10 régional 
5 regional 
2 
2 
1 multiregional 
2 
2 regional 1991 
(proposed) 
2 mult iregional 
10 regional 
10 regional 
2 
2 
2 mult iregional 
May/June-Nov./Dec. 
18 regional 
March/Apr.-Sept./Oct. 
2 
2 regional 
ANNEX 2 
Meetings of monitoring committees 
for ç$Fs, under vPlectjye Z 
COUNTRY 
Be 1 g i urn 
Denmark 
Germany 
Spain 
France 
Italy 
Luxembourg 
Neth'lands 
U. Kingdom NUMBER 
OF CSFs 
5 
2 
7 
1 
17 
9 
1 
3 
9 1990 
4 regional (1) 
1 multiregional 
2: 1 coordination 
1 multiregional 
20 regional 
9 regional 
1 
3 regional 
8 regional 1991 
(proposed) 
10 regional 
2 mult iregional 
2 
2 mult iregional 
4 regional 
34 regional 
18 regional 
1 before end-June(2) 
6 regional 
(at least) 
1 on 29.1.91 plus 
18 regional 
(1) No meeting for Limburg. 
(2) Operational programme not yet received 
COMMUNITY ASSISTANCE BY CSF 
ANNEX 3 
mi I I ion ECU 
OBJECTIVE 
1 
2 
3-4 
5(b) 
TOTAL UNDER 50 
40 
1 
24 
65 50/100 
1 
4 
1 
13 
19 100/500 
4 
9 
2 
7 
22 500/1000 
1 
1 
4 
6 1000/5000 
1 
1 
2 5000 
4 
4 11 
54 
9 
44 
118 
Annex 4 
Chapter 2 
Socioeconomic impact of assistance under CSFs 
Models used 
Model A: Macroeconometric demand model for the Greek economy, 
Keynesian approach. This is a relatively small model (24 
equations, 45 variables), aggregated throughout, based on a 
purely macroeconomic approach. All the variables are 
defined in real terms and the monetary sector is 
essentially missing. Output reasonably reliable. 
Model B: Wharton-UAM macroeconometric demand model for the economy 
of Spain. This is a large-scale demand model (558 
equations, 743 variables), with a block of equations 
dealing with value-added by sector. Integrates into the 
calculations both the monetary side of the Spanish economy 
and the economy in real terms. Output is reliable. 
Model C: Simplified economic demand models for the French overseas 
departments and Corsica. These are not econometric models 
but models of the economy without a monetary section. The 
parameters are pre-set by consultants using available data, 
into which the CSF data are injected. Formal structure very 
simplified (7 equations, 12 variables). Output somewhat 
approximate. 
Model D: Macroeconometric model, HERMES-1 re I and. This is one of a 
family of models created by DG XII to study the medium-to-
long term development of the Community countries on the 
basis of microeconomic analyses. The model is designed to 
estimate both demand effects and some supply effects. To 
enable the latter to be integrated better into the analysis 
of the impact of the structural Funds, seven microeconomic 
studies have been carried out (industrial competitiveness, 
transport costs, industrial market structure, labour 
market, agriculture and food industry, services, industrial 
sector). The model is a disaggregated one with six sectors. 
Its features allow it to analyse the feedback mechanisms 
and dynamic properties (monetary and real) of an economy 
over the long run. The HERMES-ire I and model is made up of 
about 650 equations and 850 variables. Output is very 
reliable. 
Model E: General equilibrium model for two regions (Mezzogiorno and 
Centre-North region of Italy). This is a model to study 
economic interdependence between two Italian macro-regions. 
The monetary block is not developed. The model consists of 
57 equations and can estimate the demand effects and some 
supply effects created by Community structural policies. 
Output fairly reliable. 
Model F: Input-output model for two regions (Mezzogiorno and Centre-
North region of Italy). This is a comparative static model 
with nine equations (matrix design) which can be used to 
evaluate macroeconomic Impacts on the demand side and 
sectoral effects. It does not include monetary variables in 
the economy. In analysing the potential effects of 
structural policy implementation, the model can also take 
some supply effects into account. Output fairly reliable. 
Model G: General dynamic equilibrium model with endogenous growth. 
This is a long-run growth model for evaluating the impact 
of the structural policies on the Portuguese economy on 
both demand side and supply side by analysing optimal 
accumulation of public and private capital. The model 
consists of nine equations and, because of its complexity, 
is not resolved analytically but by being parameterized and 
resolved numerically. 
Model H: Macroeconomic and sectoral model for Portugal employing 
input-output tables. This model takes macroeconomic 
forecasts made by the Commission and the Portuguese 
authorities to try to isolate the impact of the structural 
Funds on the Portuguese economy. Output fairly reliable. 
Model J: Input-output models. These take macroeconomic and sectoral 
forecasts by DG II and try to isolate the impact of the 
structural policies on the main economic variables using an 
input-output analysis. At the moment the results are not 
cumulative. Sectoral analyses are possible. Output is 
reliable. 
Model K: Macroeconomic 
DG I I . and sectoral forecasting models used by 
ANNEX 5 
Forms of assistance approved in connection with Objectives 3 et 4 
in countries other than those covered by Objective 1 
(at 31 December 1990) 
Member 
State 
Belg i urn 
Denmark 
Germany 
Spa in 
France 
Italy 
Luxembourg 
Nether Iands 
U.Kingdom 
Total Object ive 
3 
4 
10 
10 
1 
1 
3 
29 Object ive 
4 
4 
10 
10 
1 
1 
1 
3 
30 Forms of 
assistance 
common to 
both Obj. 
4 
3 
7 
6 
16 
3 
1 
40 Total 
12 
3 
27 
26 
2 
16 
4 
2 
7 
99 
ANNEX 6 
Distribution of public and private expenditure by 
priority axis : Objective 5b 
TOT.PUBLIC PRIVATE 
Agricul. development and diversification 25.7 23.1 
Development of human resources 16.1 5.1 
Development of non-agricult.,non-forestry activ. 14.4 36.1 
Environment 11.9 4.0 
Tourism 8.9 14.2 
Agriculture and forestry 5.5 5.3 
Economic development (general) 4.2 1.5 
Forestry development 3.1 3.0 
Development of SMEs and business 2.5 1.6 
Agricultural and fisheries development 2.3 2.7 
Development of tourism and environment 1.7 2.2 
Minimising problems of peripherality 0.8 0.05 
Agricultural and horticultural development 0.7 0.2 
Implementation and monitoring 0.6 0.1 
Development of infrastructure 0.6 
Management of rural areas 0.4 0.6 
Miscellaneous 0.3 0.1 
Improvement of economic life 0.1 0.05 
ANNEX 7 
Commitments of EAGGF by Country and Objective in 1990 
(ECU mi I I ion) 
Member 
State 
B 
DK 
D 
GR 
E 
FR 
IRL 
I 
L 
NL 
P 
UK 
TOTAL Total 
23.1 
18.6 
185.9 
270.6 
311.6 
388.6 
130.9 
278.9 
5 
11 
249.2 
100.5 
1 973.9 Obj. 1 
270.6 
249.9 
32.4 
130.9 
147.6 
249.2 
26.9 
1 107.5 Obj.5(a) 
23 
18.6 
182.8 
35.4 
324.2 
94.8 
5 
11 
70.9 
765.7 Obj.5(b) 
3 
7.7 
21.7 
8 
2.7 
43.1 Transit, 
measures 
0.1 
0.1 
18.6 
10.3 
28.5 
57.6 
ANNEX TO CHAPTER 6: THE CONTRIBUTION OF THE LOAN INSTRUMENTS 
METHODOLOGICAL NOTES ON THE TABLES 
1. In connection with ECSC lending, the fact that the borders of ECSC 
employment areas do not always coincide with the areas defined for 
the structural Funds, especially Objective 2 areas, can lead to 
minor discrepancies in the figures. 
2. In connection with EIB lending, the following should be noted: 
2.1 The figures giving all the financing granted in 1989 in the 
Community and granted in 1989 for regional development (Tables 1 
and 5) diverge slightly from the figures published in the ElB's 
Annual Report for 1989. These differences are due to reallocations 
of some global loans. 
2.2 The allocation of EIB loans among areas covered by the structural 
Funds (Objectives 1, 2 and 5(b)) and monitoring of their conformity 
with the priorities set out in the CSFs are the responsibility of 
the Bank's staff. However, the Commission's staff has carried out 
its own analysis, particularly with regard to Objective 1, and the 
conclusions very largely agree with those of the Bank. 
2.3 The figures given here take into account both individual loans and 
lending in the form of global loans. Since global loans cover a 
broad range of sectors and objectives and no precise geographical 
locations can be given when they are signed, no analysis can be 
made until the monies have been allocated to projects. 
Individual loans considered to fit the schemes set out in the CSFs 
are not necessarily included explicitly in operational programmes. 
There are several possible variants: 
(a) A loan pertains to a NUTS III area which is closely defined. 
(b) A loan may be for a grid or network or part of a network 
involving several geographical areas (telecommunications, 
railways, roads, etc.). The loans are then split up over the 
areas concerned in proportion to population or in line with 
other indications in the background documentation. This 
splitting can lead to the total of the loan as signed not being 
reached. 
ANNEX 9 
Commitments of ESF by Country and Objective in 1990 
(ECU mi I I ion) 
Member 
State 
B 
DK 
D 
GR 
E 
FR 
IRL 
I 
L 
NL 
P 
UK 
Comm­
ission 
TOTAL Total 
65 
39.67 
211.42 
339.23 
722.241 
400.262 
307.19 
508.840 
2.164 
86.22 
284.126 
537.846 
0.698 
(1) 
3 504.9 Obj. 1 
337.78 
443.98 
40.38 
304.90 . 
284.434 
284.126 
65.157 
1 760.8 Obj. 2 
14.297 
0.979 
40.411 
62.384 
60.304 
31.286 
13.634 
115.054 
338.3 Obj. 
3/4 
48.963 
35.807 
169.336 
215.876 
283.659 
183.481 
2.164 
72.585 
356.947 
1 368.8 Obj.5(b) 
0.4 
1.673 
4.093 
6.2 Innovât. 
measures 
1.744 
2.479 
1.443 
11.823 
2.29 
9.637 
0.686 
0.698 
30.80 
(1) Amount not subdivided by country 
TABLE I 
Estimates of lending in the CSFs and 
actual signed EIB loans corresponding to CSFs 
CSF estimates for 1989- 1993 
(1989 prices, MECU) Actual 1989 & 1990 
Cumulative signed loans total 
(current MECU) (MECU) 
Member 
State 1 Object ives 
2 & 5b Objectives 
2 and 5b 1,2,5b 
Be I g i urn 
Denmark 
Germany 
Greece 1402.0 
Spa in 1811.0 
France 121.0 
Ireland 500.0 
Italy 1475.0 
Luxembourg 
Netherlands 
Portugal 2805.0 
United Kingdom 
TOTAL 8114.0 p.m, 
p.m 
p.m, 
p.m 
p.m, 
p.m, 
p.m, 
p.m 
p.m, 
p.m 
p.m 
p.m, 
p.m 394.0 
1279.0 
6.0 
292.0 
2630.0 
1347.0 
5948.0 63.0 
29.0 
90.0 
692.0 
391.0 
395.7 
16.0 
345.0 
2021.7 63.0 
29.0 
90.0 
394.0 
1971.0 
397.0 
292.0 
3025.7 
16.0 
1347.0 
345.0 
7969.7 
-2-
(c) A loan may relate to ah operation which cannot be imputed to a 
given region (the purchase of aircraft, for instance). These 
are included in "Other", except where the whole of a country is 
eligible under Objective 1. 
As regards the allocation of global loans, all CSFs refer to aid 
for investment in industrial and craft-industry enterprises and to 
supporting SMEs. Allocations to a productive sector (industry, 
agriculture, services) have been counted as matching the 
requirements of the CSFs. By contrast, allocations to 
infrastructure projects or energy schemes have in most cases not 
been included. 
TABLE III 
EIB DIRECT LOANS 1989 & 1990 
current MECU 
:MBER STATE 
1GIUM 
:NMARK 
RMANY 
EECE 
AIN 
ANCE 
ELAND 
ALY 
XEMBOURG 
THERLANDS 
RTUGAL 
ITED KINGDOM 
TAL - — 
1 
Reg i ona1 
Deve1 op. 
611.5 
243.8 
318.2 
1721.2 
1346.7 
378.5 
3683.7 
11.8 
74.1 
1246.4 
1538.1 
11174.0 2 
Obj. 1 
318.2 
928.3 
378.5 
2656.7 
1246.4 
1.5 
5529.6 
1 3 
2:1 
X 
100.0 
53.9 
100.0 
72.1 
100.0 
0.1 
49.5 1 
4 
Corresp. 
to CSF 
measures 
293.5 
928.1 
281.4 
2107.7 
1044.0 
4654.7 5 
4:2 
X 
92.2 
100.0 
74.3 
79.3 
83.8 
0.0 
84.2 I 
6 
projects 
received 
ERDF 
183.8 
45.3 
159.6 
370.5 
728.4 
1487.6 7 
6:4 
X 
62.6 
4.9 
56.7 
17.6 
69.8 
31.9 8 
Obj.245b 
282.8 
145.0 
761.0 
898.5 
554.9 
11.8 
74.1 
1294.4 
4022.5 9 
8:1 
X 
46.2 
59.5 
44.2 
66.7 
15.1 
100.0 
100.0 
84.2 
36.0 10 
Corresp. 
to CSF 
measures 
616.2 
10.0 
311.8 
938.0 11 
10:8 
X 
81.0 
1.1 
24.1 
23.3 r • • — 
12 
projects 
received 
ERDF 
46.3 
25.8 
72.1 1 "_ 
13 
12:8 
X 
7.5 
8.3 
7.7 
TABLE II 
EIB DIRECT LOANS 1989 & 1990 
(current MECU) 
Member State 
Be 1gI urn 
Denmark 
Germany 
Greece 
Spain 
France 
I re 1 and 
Italy 
Luxembourg 
Netherlands 
Portugal 
United Kingdom 
TOTAL 1 
Reg IonaI 
Development 
MECU 
611.5 
243.8 
318.2 
1,721.2 
1,346.7 
378.5 
3,683.7 
11.8 
74.1 
1.246.4 
1,538.1 
11.174.0 2 
Obj. 1. 2 * 
5b Regions 
MECU 
282.8 
145 
318.2 
1,689.3 
898.5 
378.5 
3.211.6 
11.8 
74.1 
1,246.4 
1.295.9 
9.552.1 3 
2 : 1 
X 
46 
60 
100 
98 
67 
100 
87 
100 
100 
100 
84 
85 4 
Corresponding 
to CSF 
Measures 
293.5 
1,544.3 
10 
282.4 
2.107.7 
1,044.0 
311.8 
5,592.7 5 
4 : 2 
X 
92 
91 
1 
74 
66 
84 
24 
59 6 
To Projects 
receiving 
ERDF grants 
MECU 
183.8 
91.6 
159.6 
370.5 
728.4 
25.8 
1,559.7 7 
6 : 4 
X 
63 
6 
56 
18 
70 
8 
28 
Source : Calculated from EIB data. 
TABLE V 
EIB DIRECT LOANS 1990 
current MECU 
*BER STATE 
-GIUM 
*AARK 
&4ANY 
:ECE 
UN 
kNCE 
:LAND 
U.Y 
(EMBOURG 
rHERLANDS 
mjGAL 
[TED KINGDOM 
fAL 1 
Reg i onaI 
DeveI op. 
254.6 
132.3 
110.4 
843.9 
709.2 
191.7 
1844.6 
11.8 
18.3 
671.3 
945.4 
5733.5 
» 2 
Obj. 1 
110.4 
415.1 
191.7 
1417.1 
671.3 
2805.6 3 
2:1 
X 
100.0 
49.2 
100.0 
76.8 
100.0 
48.9 4 
Corresp. 
to CSF 
measures 
110.4 
415.1 
148.7 
1184.3 
666.3 
2524.8 
i 5 
4:2 
% 
100.0 
100.0 
77.6 
83.6 
99.3 
90.0 
1 6 
projects 
received 
ERDF 
45.8 
110.6 
353.9 
433.9 
944.2 
i 7 
6:4 
% 
41.5 
74.0 
29.9 
65.1 
37.4 
I 8 
Obj.2*5b 
111.5 
93.5 
396.9 
493.5 
205.4 
11.8 
18.3 
772.8 
2103.7 9 
8:1 
% 
43.8 
70.7 
47.0 
69.6 
11.1 
100.0 
100.0 
81.7 
36.7 
i 10 
Corresp. 
to CSF 
measures 
285.8 
162.0 
447.8 
• 11 
10:8 
X 
72.0 
21.0 
21.3 12 
projects 
received 
ERDF 
18.5 
18.5 13 
12:8 
% 
11.4 
4.1 
TABLE IV 
EIB DIRECT LOANS 1990 
(current MECU) 
Member State 
Belgium 
Denmark 
Germany 
Greece 
Spain 
France 
Ireland 
Italy 
Luxembourg 
Netherlands 
Portugal 
United Kingdom 
TOTAL 1 
Reg I ona I 
Development 
MECU 
254.6 
132.3 
110.4 
843.9 
709.2 
191.7 
1.844.6 
11.8 
18.3 
671.3 
945.4 
5,733.5 2 
Obj. 1, 2ft 
5b Regions 
MECU 
111.5 
93.5 
110.4 
812.0 
493.5 
191.7 
1,622.5 
11.8 
18.3 
671.3 
772.8 
4,909.3 3 
2 : 1 
X 
44 
71 
100 
96 
70 
100 
88 
100 
100 
100 
82 
86 4 
Corresponding 
to CSF 
Measures 
110.4 
700.9 
148.7 
1,184.3 
666.3 
162.0 
2,972.6 5 
4 : 2 
X 
100 
86 
78 
73 
99 
21 
60 6 
To Projects 
receiving 
ERDF grants 
MECU 
45.8 
110.6 
353.9 
433.9 
18.5 
962.7 7 
6 : 4 
X 
44 
74 
30 
65 
11 
33 
• — • -
Source : Calculated from EIB data. 
Table VII 
ECSC LENDING IN 1990 
current MECU 
MBER STATE LOANS UNDER ART. 54 OF THE ECSC LOANS UNDER ART. 56 OF THE ECSC 
GLOBAL DIRECT TOTAL ECSC LENDING (ART. 54 ft 56) 
-GIUM 
WARK 
*MANY 
UN 
KNCE 
KLY 
KEMBOYRG 
rHERLANDS 
*TU6AL 
ITED KINGDOM 
rAL 6.1 
3.0 
114.9 
107.9 
76.2 
67.3 
22.9 
398.3 OF WHICH IN REGIONS OF OF WHICH IN REGIONS OF 
OBJ. 1 
68.9 
67.3 
136.2 OBJ. 2 OBJ. 1 
3.0 
45.9 
82.7 
71.7 
22.9 15.9 
186.3 
12.6 
39.1 
55.0 
2.4 
247.1 2.1 
1.5 
25.5 
226.2 558.4 27.0 2.1 OBJ. 2 
15.8 
136.3 
10.5 
31.1 
47.8 
228.2 15.9 
6.1 
189.3 
127.5 
148.5 
131.2 
2.4 
67.3 
295.5 
469.7 983.7 OF WHICH IN REGIONS OF 
OBJ. 1 
71.0 
67.3 
138.3 OBJ. 2 
15.8 
139.3 
56.4 
113.8 
119.5 
251.1 
695.9 
:e : Commission services 
TABLE VI 
ECSC LENDING IN 1989 
current MECU 
MBER STATE LOANS UNDER ART. 54 OF THE ECSC LOANS UNDER ART. 56 OF THE ECSC 
GLOBAL DIRECT 1 TOTAL ECSC LENDING (ART. 54 ft 56) 
LGIUM 
NMARK 
RMANY 
UN 
MCE 
KVt 
XEMBOURG 
rHERLANDS 
*TUGAL 
ITED KINGDOM 
fAL 1.0 
2.8 
10.7 
67.2 
70.6 
40.7 
32.7 
225.7 OF WHICH IN REGIONS OF OF WHICH IN REGIONS OF 
OBJ. 1 
40.7 
40.7 OBJ. 2 OBJ. 1 
7.2 
51.5 
21.8 12.9 
146.7 
9.3 
35.7 
40.0 
1.2 
1.8 
154.5 2.2 
7.6 
46.5 7.6 
80.5 402.1 56.3 7.6 OBJ. 2 
12.9 
74.5 
1.7 
43.3 
33.1 
192.6 12.9 
1.0 
151.7 
9.3 
54.0 
107.2 
1.2 
72.4 
40.7 
233.7 
358.1 684.1 OF WHICH IN REGIONS OF 
OBJ. 1 
7.6 
40.7 
48.3 OBJ. 2 
12.9 
74.5 
1.7 
50.5 
84.6 
214.4 
438.6 
ce : Commission services 
GLOSSARY 
Cl. 
C.P. 
CSF 
EAGGF 
ECSC 
ECU 
EIB 
ENVI REG 
ESF 
ERDF 
ERGO 
EUROFORM 
EUROTECNET 
FORCE 
GDP 
GNP 
HORIZON 
HELIOS 
I DO 
IMP 
INTERREG 
IRIS 
LEADER Community Initiative 
Community Programme 
Community Support Framework 
European Agricultural Guidance and Guarantee Fund 
European Coal and Steel Community 
European Currency Unit 
European Investment Bank 
Commission initiative on the regional environment (C.I.) 
European Social Fund 
European Regional Development Fund 
Community programme aimed at the long-term unemployed 
Initiative for the development of new skills and new 
employment opportunities (C.I.) 
Community programme of pilot training projects in the 
field of new technologies 
Community action programme for the development of 
continuing training 
Gross domestic product 
Gross national product 
Community initiative for handicapped persons and 
certain other disadvantaged groups (C.I.) 
Community action programme aimed at the handicapped 
Integrated Development Operation 
Integrated Mediterranean Programme 
Community initiative for border areas (C.I.) 
European network of training programmes for women (1989-
1992) 
Links between activities for the development of the rural 
economy (C.I.) 
LEDA Programme for local employment development 
Table VIII 
ECSC LENDING IN 1989-1990 
current MECU 
MBER STATE LOANS UNDER ART. 54 OF THE ECSC LOANS UNDER ART. 56 OF THE ECSC 
GLOBAL DIRECT TOTAL ECSC LENDING (ART. 54 ft 56) 
LGIUM 
NMARK 
RMANY 
AIN 
ANCE 
ALY 
NEMBOYRG 
THERLANDS 
RTUGAL 
ITED KINGDOM 
TAL 7.1 
5.8 
114.9 
118.6 
143.4 
70.6 
108.0 
55.6 
624.0 OF WHICH IN REGIONS OF 
OBJ. 1 
68.9 
108.0 
176.9 OBJ. 2 OF WHICH IN REGIONS OF 
OBJ. 1 I OBJ. 2 
3.0 
45.9 
89.9 
123.2 
44.7 28.8 
333.0 
21.9 
74.8 
95.0 
3.6 
1.8 
401.6 2.2 
9.1 
72.0 9.7 
306.7 960.5 83.3 9.7 28.7 
210.8 
12.2 
74.4 
80.9 
420.8 28.8 
7.1 
341.0 
136.8 
202.5 
238.4 
3.6 
72.4 
108.0 
529.2 
827.8 1.667.8 OF WHICH IN REGIONS OF 
OBJ. 1 
78.6 
108.0 
186.6 OBJ. 2 
28.7 
213.8 
58.1 
164.3 
204.1 
465.5 
1.134.5 
ce : Commission services 
GLOSSARY 
C.I. 
C.P. 
CSF 
EAGGF 
ECSC 
ECU 
EIB 
ENVI REG 
ESF 
ERDF 
ERGO 
EUROFORM 
EUROTECNET 
FORCE 
GDP 
GNP 
HORIZON 
HELIOS 
I DO 
IMP 
INTERREG 
IRIS 
LEADER Community Initiative 
Community Programme 
Community Support Framework 
European Agricultural Guidance and Guarantee Fund 
European Coal and Steel Community 
European Currency Unit 
European Investment Bank 
Commission initiative on the regional environment (C.I.) 
European Social Fund 
European Regional Development Fund 
Community programme aimed at the long-term unemployed 
Initiative for the development of new skills and new 
employment opportunities (C.I.) 
Community programme of pilot training projects in the 
field of new technologies 
Community action programme for the development of 
continuing training 
Gross domestic product 
Gross national product 
Community initiative for handicapped persons and 
certain other disadvantaged groups (C.I.) 
Community action programme aimed at the handicapped 
Integrated Development Operation 
Integrated Mediterranean Programme 
Community initiative for border areas (C.I.) 
European network of training programmes for women (1989-
1992) 
Links between activities for the development of the rural 
economy (C.I.) 
LEDA Programme for local employment development 
MOP 
NOW 
NPCI 
NUTS 
N.Q. Multi-fund operational programme 
Community initiative to promote equal opportunities for 
women in the field of employment and vocational 
training (C.I.) 
National Programme of Community Interest 
Nomenclature of Territorial Statistical Units 
Non-Quota Community programmes (C.P.) 
OP Operational programme 
PEDAP 
PEDIP 
POSE I DOM 
PR ISMA 
RDP 
RECHAR 
REGEN 
REGIS 
RENAVAL 
RESIDER 
SMEs 
STAR 
STRIDE 
TELEMATIQUE 
VALOREN Specific programme for the development of Portuguese 
agr iculture 
Specific programme for the development of Portuguese 
industry 
Programme of specific options aimed at remote and 
isolated departments 
Preparation of firms for the Single Market (C.I.) 
Regional development plan 
Community initiative for the economic conversion of 
coalmining areas (C.I.) 
Community initiative concerning energy supply 
networks (C.I.) 
Community initiative for the remoter regions (C.I.) 
Conversion of shipbuilding areas (C.P.) 
Conversion of steel areas (C.P.) 
Small and medium-sized enterprises 
Community programme: Special Telecommunications Action 
for Regional Development (C.P./C.I.) 
Community initiative: Science and Technology for Regional 
Innovation and Development in Europe(C.I-) 
To promote the use of advanced telecommunications services 
in regions whose development is lagging behind, including 
improved access to advanced services located elsewhere in 
the E.C. (C.I.) 
Community programme for exploiting endogenous energy 
potential (C.P.) 
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