4. 7. 88 Official Journal of the European Communities No C 175/17 
7.7. The Committee stresses the need for a simple 
and acceptable procedure by which those concerned, 
notably the competent authorities designated by Mem­
ber States, and the Commission, can find quick sol­
utions in emergency situations. 
7.8. Accordingly, the Commission should act as the 
central recipient of information on dangerous products 
urgently notified to it by both national and local autho­
rities who have concluded that swift action is necessary. 
These authorities would also inform the Commission 
about voluntary withdrawals carried out by producers. 
Under appropriate circumstances, the Commission 
would also take into account information relayed to it 
by other reputable sources in view of the need to have 
access to a wide range of respondents. 
7.9. If the original action turns out to be justified, 
Done at Brussels, 27 April 1988. 
1. Introduction 
1.1. The twelfth annual report of the European 
Regional Development Fund, for 1986, was published 
by the Commission on 1 December 1987. The Commit­
tee welcomes the report which indicates that in the the Commission should have the task of requiring all 
Member States to take equivalent action. 
7.10. In a sudden emergency involving the health 
and safety of a substantial number of people, immediate 
action is needed. Member States can themselves decide 
to respond instantly, but in addition the Commission 
should be in a position to ensure that binding emergency 
measures are adopted in the Member States in accord­
ance with uniform criteria. There is therefore a need 
for an effective Community legal instrument (see para­
graph 1.3) with a clear set of rules, to make intervention 
in emergency cases possible. This intervention would 
involve the immediate suspension, seizure or even 
destruction of dangerous goods. 
The Chairman 
of the Economic and Social Committee 
Alfons MARGOT 
year under review the range and scale of the Fund's 
activities continued to increase. The Committee also 
notes with approval the progressive development of the 
analytical procedures which the Fund is bringing to 
bear on the identification of priority issues and the 
examination of proposals for the alleviation of regional 
problems. Opinion on the twelfth report of the European Regional Development Fund 
(88/C 175/08) 
On 21 December 1987, the Commission decided to consult the Economic and Social Commit­
tee, under Article 198 of the Treaty establishing the European Economic Community, on the 
twelfth report of the European Regional Development Fund (ERDF). 
The Section for Regional Development, and Town and Country Planning, which was 
responsible for preparing the Committee's work on the subject, adopted its Opinion on 
19 April 1988, in the light of the report by Mr Black. 
At its 255th plenary session (meeting of 27 April 1988), the Economic and Social Committee 
adopted the following Opinion unanimously with one abstention. 
No C 175/18 Official Journal of the European Communities 4. 7. 88 
1.2. The report is under review at the same time 
as the European Community is facing the stimulating 
challenges of the creation of a large barrier-free internal 
market by 1992. This should bring economic and social 
benefits to the Community as a whole and it is a vital 
common concern that the process should be 
accompanied by a reduction in regional economic dis­
parities and the encouragement of growth in less 
developed areas. The lessons learnt from recent devel­
opments of Community regional policy and from the 
evolution of the ERDF offer important pointers for 
future policy and for the procedures and priorities of 
the enlarged ERDF. 
1.3. In 1986 the latest enlargement of the Community 
affected the ERDF as the first commitments were made 
in favour of regions in Spain and Portugal. Reflecting 
this enlargement, the funds available through the ERDF 
increased significantly in 1986. Commitments accepted 
amounted to 3 186 million ECU, an increase of 28 % 
on the preceding year. This increase, amounting to 
691 million ECU, was more than offset by the level of 
commitments for applications from Spain and Portugal 
which amounted to 1 021 million ECU. Because of the 
combined effects of an inadequate increase in the Fund's 
resources and reallocation to meet the needs of Spain 
and Portugal, commitments for the other ten Member 
States fell by over 12 %. 
1.4. Payments made from the ERDF also increased; 
payments of 2 394 million ECU were over 50 % higher 
than in 1985 but, excluding the effect of the first pay­
ments to Spain and Portugal, payments to the Member 
States rose by 19 %. As is now customary, commitments 
accepted continued to exceed payments because of the 
time lag between the different stages and also because 
some applications, after approval, lapse when schemes 
do not proceed as anticipated. At the end of 1986 
outstanding commitments reached 5 724 million ECU. 
This is nearly 2,4 times the annual spending in 1986, 
but, for comparison, this ratio was significantly higher 
a year earlier, at 3,2. 
1.5. The ERDF is, of course, not the only Com­
munity instrument which provides assistance to the 
regions. The Social Fund and the European Agricultural 
Guidance and Guarantee Fund (EAGGF), Guidance 
Section, are administered in coordination with the 
ERDF and these are reinforced by lending from the 
European Investment Bank (EIB) and under the New 
Community Instrument (NCI). The contribution of the­
se instruments to regional development is mentioned 
briefly in section 5.4 of the report. Some more detailed 
information on the combined disbursements from these 
sources and a summary of the incidence of the expendi­
ture and its impact on problem regions would have 
been valuable. 2. The socio-economic background 
2.1. Information on the evolution of regional dispar­
ities was improved by the publication of the third 
periodic report in May 1987. The evidence that dispar­
ities in unemployment rates have widened and dispar­
ities in gross domestic product (GDP) have not nar­
rowed reinforces the Committee's often expressed view 
that regional policy must be strengthened. In the slow 
economic growth of the 1980s a deterioration in the 
relative position of some regions was almost inevitable. 
For the future, the suggestion (section 1.2) that dispar­
ities may widen further in the next ten years is an 
unwelcome (even if realistic) forecast. 
2.2. In an assessment of the dimensions of regional 
disparities the relative importance of differences 
between Member States and within Member States is 
important. Given that one half of regional disparities 
can be attributed to the former, it follows that conver­
gence between Member States could be, inter alia, a 
major contribution to regional convergence. To achieve 
this convergence will require a vigorous and coordi­
nated use of all the instruments of economic policy. 
Improved regional policies, per se, can contribute to 
improved outcomes but cannot, in themselves, do more 
than make a partial contribution to the process of 
reducing regional disparities. Regional development is 
not a result of specific regional policies only. In this 
context the EC should act as a model for Member 
States and could then urge, with greater force, that 
Member States should also develop this approach in 
the national context. 
2.3. The report presents some worrying indications 
of how demographic and economic changes may 
adversely affect the less prosperous regions. The Com­
mittee welcomes the frank acknowledgement of these 
adverse trends, which include: 
— demographic changes which would mean that the 
growth of GDP in the less prosperous countries 
would need to be two percentage points higher than 
in the other countries to maintain any progress 
towards convergence, 
— a forecast that benefits arising from the completion 
of the internal market in the Community, by 1992, 
will probably be spread unevenly among the 
regions. 
2.4. There are, of course, larger and wider gains in 
prospect from the completion of the internal market 
linked to the increased strength of the whole Com­
munity; but any potentially adverse trends provide a 
compelling reason for giving a very high priority to 
regional policy during the next five years and emphasize 
the need for a close monitoring of the developing situ­
ation to ensure that the increased funds which will be 
available for regional policy are used effectively. 
4. 7. 88 Official Journal of the European Communities No C 175/19 
2.5. The principle of coordination, linking industrial 
and agricultural policies to a consideration of their 
regional impact, is now accepted. The Committee notes 
the work which has been undertaken to make further 
assessments of the regional impact of Community poli­
cies and urges that this work should be given a high 
priority. The Committee welcomes the evidence of an 
increased concern for the regional implications of poli­
cies relating to agriculture but it is not satisfied that 
the Commission has adequately developed this analysis. 
For many of the poorest regions the reform of the 
common agricultural policy (CAP) has major impli­
cations. 
2.6. The report (section 1.2.7) makes an analytical 
comment on the relationship of salary costs to pro­
ductivity and their influence on regional convergence. 
The Committee notes the report's view that unit wage 
costs are thought to be relatively high in a number of 
problem regions. The Committee has already drawn 
attention to the complexity of this issue in its Opinion 
on the third periodic report (doc. CES No 1164/87) and 
reiterates its opinion that much further work is needed 
before any reliable conclusions can be drawn on this 
subject. 
3. The impact of Regulation (EEC) No 1787/84 
3.1. The report confirms that, in its second full year 
of operation, Regulation (EEC) No 1787/84 for the 
ERDF is now functioning in a generally satisfactory 
way. The change from relatively fixed national quotas 
for the main disbursements to a system based on upper 
and lower percentage limits and the increasing emphasis 
on programmes of Community interest, as opposed to 
individual projects, has increased the ability of the 
Commission to identify priorities and channel funds 
appropriately. 
3.2. Reference is made to the capacity of the Com­
mission to use discretion on budgetary resources avail­
able after the minimum, or lower, limits of allocations 
have been reached (section 2.2.12). The Committee 
would have been interested to have further analysis 
on how this 'margin' was allocated between Member 
States. 
3.3. The new Regulation does not change one of 
what should be the most important characteristics of 
the ERDF. If the Fund is to have impact, it must be 
additional to the existing national and regional 
resources. The Commission already has the support of 
the Economic and Social Committee in its endeavours 
to demonstrate 'additionality' and the Committee wel­
comes the clear outline of the forms which, in practical 
terms, it may take. However, whilst the Committee 
has noted with great interest the procedures used by 
Member States, this information serves to confirm its 
view that for industrial projects Member States tend to 
add the ERDF allocations to their total funds but not to individual projects. In other words, ERDF funds are 
used to offset part of the national commitment to 
individual projects. However, the principles of addition­
ality are now widely acknowledged and applied less 
controversially in support of approved programmes and 
infrastructure projects. These principles will become 
more significant in the functioning of the reformed, 
and enlarged, Fund when resources are allocated in a 
selective manner to priority regions within approved 
programmes. The Committee hopes that the import­
ance of the concept of 'additionality' will be further 
clarified in the regulations relating to the reformed 
funds. 
4. ERDF-operations 
4.1. Whilst in 1986 the ERDF was used mainly to 
fund projects submitted as applications by Member 
States, the emphasis on programme financing was the 
most important development with long term impli­
cations. In the Opinion expressed by the Economic and 
Social Committee on the eleventh report of the ERDF 
the shift to programme financing was welcomed and it 
is now clear that we have moved from a past era of 
'projects' to a more modern era of 'programmes'. The 
hope was expressed that this change would reinforce 
the concept of additionality and help to provide a better 
directed and coordinated use of the ERDF (!). 
4.2. The twelfth report suggests that the target for 
20% of the Fund to be allocated to co-financing of 
programmes should be reached in 1987. The Committee 
would congratulate the Commission on the achieve­
ments in 1986 and welcomes this undertaking concern­
ing the 1987 operations. 
a) Community programmes 
4.3. In 1986 two Community programmes with spec­
ific regional emphasis were finally approved. The STAR 
programme provides funds to improve advanced tele­
communications services. The VALOREN programme 
relates to measures to exploit endogenous energy poten­
tial. Both programmes have already been subjected to 
detailed scrutiny. In the context of the ERDF activities 
the Committee regards these programmes as a signifi­
cant development and hopes that Member States will 
cooperate in ensuring their effective exploitation. In the 
ERDF report on 1987 the Committee would hope to 
be given some information on the application of these 
Community programmes to the qualifying regions. 
4.4. The Committee also notes that preparatory 
studies on two further possible Community pro­
grammes for technological research and environmental 
policy have been undertaken and hopes that these 
studies will be followed, expenditiously, by appropriate 
draft Regulations. 
(!) OJ No C 180, 8. 7. 1987, p. 48. 
No C 175/20 Official Journal of the European Communities 4. 7. 88 
b) National programmes of Community interest 
4.5. During 1986, 47 applications seeking assistance 
of 682 million ECU were submitted from all the Mem­
ber States except Germany, Spain and Portugal. After 
vetting these, and some applications from 1985, 14 
applications were approved for commitments of 
416 million ECU in the period to 1992. This compares 
with three such approvals in 1986 with commitments 
of 260 million ECU. 
4.6. This evidence confirms that the concept of 
national programmes of Community interest has 
attracted interest and the details of the successful appli­
cations indicate the way in which these programmes 
can reflect particular regional neds. Of particular rel­
evance are the three trans-frontier development schemes 
coordinated with respect to adjoining areas in France, 
Luxembourg and Belgium. These will provide an 
interesting testing ground for the development of 
regional policy in the context of the single market. 
4.7. Two further features of this section of the 
report are identified so that there can be a clearer 
understanding of the scope expected, and acceptable, in 
national programmes. First, the number of applications 
not accepted is high as a proportion of the total, but 
no analysis of the reasons for this is offered. Second, 
the fact that Spain and Portugal were not in a position 
to submit applications is understandable, but it may be 
more significant that no applications were received 
from Germany, and, further, no applications from Italy 
and Ireland have yet been successful. The Commission 
is asked to provide as much help as possible to those 
Member States who may have difficulty in the prep­
aration of programmes. 
c) Projects 
4.8. A very high proportion of ERDF assistance goes 
to infrastructure projects. In 1986 these were allocated 
87% of the assistance available; this compares with 
82% in 1985, 85% in 1984. These figures are well 
above the informal target accepted by the Commission 
to limit these applications to a desirable maximum of 
70 % of the available resources. The Committee notes 
with regret that applications submitted for industry 
services and craft projects were substantially below the 
levels recorded in 1985. This occurred in spite of the fact 
that cost per job criteria were eased and the threshold of 
a minimum of 10 jobs was removed in order to encour­
age micro-projects. 
4.9. The problems of attracting industry, service and 
craft applications seem to be Community wide. How­
ever, the Committee recognizes that different Member 
States have produced differing responses and that Ger­
many has managed to exceed the 30 % target, reaching 65 %; the next highest figures are as low as 23 % from 
Italy and 19% from Belgium. 
4.10. The number of jobs, created or maintained, in 
industry, services and crafts is estimated to have been 
68 062. This is nearly 20% higher than the comparable 
1985 result and is a reflection of the large increase in 
the number of projects defined as small: an investment 
of less than 15 million ECU. This is a development 
which is welcomed. The Committee is aware that esti­
mates of the number of jobs created or maintained are 
necessarily tentative and urges that there should be 
retrospective investigations on the reliability of the esti­
mates. 
4.11. The service sector in most economies is an 
expanding one. The Committee is therefore interested 
in the role of the ERDF in the development of appropri­
ate services. Specific 'projects' in the service sector 
received a slightly smaller share of aid from the ERDF 
in 1986. In part this is compensated by unreported 
contributions to this sector within the wider pro­
grammes which have been approved. Some analysis of 
the assistance to service sector employment which has 
been aided in both projects and programmes would be 
welcome. 
d) Development of regions' endogenous potential 
4.12. The search for self-help is a major motivating 
force in many less prosperous regions. The Commission 
recognized the importance of these internally generated 
processes when it identified the need for measures to 
develop endogenous potential. However, whilst the 
Committee welcomes the modest proposals to link busi­
nesses with information on technology and help with 
access to capital markets, these have not, as the report 
confirms, made a significant impact. 
4.13. The Committee proposes that the Commission 
should seek further methods of providing resources 
directly through existing local enterprise agencies who 
function at a viable level and who provide matching 
funds from their own resources. In this way the Com­
mission and the ERDF could have a higher profile in 
many of the larger regional centres. 
e) Studies 
4.14. Special studies form, in many cases, an essential 
early component of the evolution of appropriate 
regional measures. For Community programmes, cross-
national studies are likely to be needed. The Committee 
is disappointed that the Commission has not maintai­
ned the practice, as in the eleventh report, of providing 
a brief statement on studies launched and completed. 
It is also surprising that so few of the Member States 
have submitted proposals for studies which gained 
Commission support. 
4. 7. 88 Official Journal of the European Communities No C 175/21 
5. Integrated development operations 
5.1. As the Commission has refined its ideas on 
how it can contribute to the dynamic of economic 
development in less prosperous areas, a continuing aim 
has been to integrate, or coordinate, the various funds 
and Community policies to create a consistent approach 
which maximizes the potential benefits. 
5.2. Integrated operations proposals (IOs) have evol­
ved and been approved for Naples and Belfast. Inte­
grated development programmes (IDPs) were the 
instrument devised with reference to three areas where 
agricultural and non-agricultural activities were under 
review in what are mainly agricultural regions. In 
southern Europe the mechanism is the integrated medi­
terranean programme (IMP) and thirty-one pro­
grammes have been submitted from France, Greece and 
Italy. More recently, a special development programme 
for Portuguese industry has been submitted for 
approval. 
5.3. The significance of these several 'integrated' 
mechanisms is that they provide a rationale for recourse 
both to the ERDF, as appropriate, and to the other 
funds, such as the European Social Fund and the Euro­
pean Investment Bank, and can claim priority treat­
ment. 
5.4. The Committee acknowledges the various 
reasons for differences in emphasis in these differing 
programmes. Nevertheless, as an aid to greater under­
standing of the benefits of these operations, it would 
be helpful to the Committee if it is given information 
on the level of payments made under each scheme in 
the year under review together with a simplified analysis 
of those payments which qualified under the ERDF. It 
is not clear from the report how active each of the 
projects has been in 1986. 
6. Location of ERDF assistance 
6.1. In 1986, the most obvious change in the allo­
cation of ERDF assistance was the inclusion of the 
regions of Spain and Portugal. The entry of these two 
new Member States increased the relevance of the Com­
munity's regional policies and supports the claim for 
an increase in the size of the structural funds, including 
the ERDF. Including the regions of Spain and Portugal 
within the group of priority regions means that 73 % 
of the Fund's payments were made on behalf of these 
regions. In 1985, without Spain and Portugal, this pro­
portion was 60 %. 
Done at Brussels, 27 April 1988. 6.2. The report identifies the ten regions which 
received most assistance from the Fund. This ranking 
is in absolute terms and is not the same as that in 
assistance per capita. Of the regions which received 
most assistance per capita four were in Portugal, two 
in Greece, two in Italy and one in Spain. The remaining 
region was Guyane, France. 
6.3. As in previous years, the expanded report on 
the way in which assistance was used in the regions of 
each Member State is an essential element in under­
standing the wide ranging significance of the Fund. 
7. Conclusions 
7.1. This report is of particular interest because it 
provides an account of the operations and experience 
of the ERDF which will serve as a pointer to the 
development of the new regional policy in the run­
up to the single internal market in 1992. The report 
emphasizes the fact that the single market can add to 
the problems of the poorer regions; disparities will 
increase if the rates of growth in the peripheral regions 
are not reinforced. There is a need for close monitoring 
of the regional impact of the move to a single market 
in 1992. 
7.2. The Economic and Social Committee has a 
major role to play in this continuous monitoring pro­
cess. If it is to play that role effectively, then the flow 
of information from the structural funds will have to 
be improved by being more up to date and complete. 
7.3. The Fund faces the challenge of radical changes 
in its working methods as its increased resources are 
brought to bear on the developing problems of the 
regions. It is essential that its activities are continuously 
tested against the target of reducing regional disparities. 
In this context there is a continuing need for the evalu­
ation of the regional incidence of all expenditures made 
by Community instruments. The EC can, in this respect, 
play a major role in providing a model for the Member 
States. Such procedures would further facilitate a deep­
ening partnership between Community, national, 
regional and local authorities in which each contributes 
to the development of regional policy. 
The Chairman 
of the Economic and Social Committee 
Alfons MARGOT