COMMISSION OF THE EUROPEAN COMMUNITIES 
COM(95) 1 final 
Brussels, 17.01.1995 
ANNUAL REPORT 
COHESION FINANCIAL INSTRUMENT 
1993/1994 
2 
ANNUAL REPORT 
COHESION FINANCIAL INSTRUMENT 
SUMMARY 
Preliminary note 
Introduction 
Chapter 1 - The legislative and administrative background 
1.1. The Treaty of Maastricht and the protocol 
1.2. The Edinburgh European Council 
1.3. The cohesion financial instrument 
1.4. The standard decision 
1.5. Application form 
1.6. Monitoring arrangements 
1.7. The regulation establishing the Cohesion Fund 
1.8. The Commission regulation on irregularities 
Chapter 2 - Financial assistance committed and paid bv the Fund 
2.1. The budget available 
2.2. Breakdown by Member State 
2.3. Implementation of the budget under the cohesion financial instrument 
2.3.1. Spain (a) Environment 
(b) Transport 
2.3.2. Portugal (a) Environment 
(b) Transport 
2.3.3. Greece (a) Environment 
(b) Transport 
2.3.4. Ireland (a) Environment 
(b) Transport 
3 
2.4. Assistance for studies and technical support measures 
2.4.1. General 
2.4.2. On the Commission's initiative 
(a) Indication of interest 
(b) Types of measures selected 
2.4.3. At the request of the Member States 
(a) Spain 
(b) Portugal 
(c) Greece 
(d) Ireland 
2.5 Payments made in 1993/94 for projects approved under the cohesion financial 
instrument, by Member State 
(a) Spain Advances/interim payments/balances 
(b) Portugal Advances/interim payments/balances 
(c) Greece Advances/interim payments/balances 
(d) Ireland Advances/interim payments/balances 
Chapter 3 - Convergence and conditionality 
3.1. General 
3.2. Convergence programmes 
(a) Greece 
(b) Spain 
(c) Portugal 
(d) Ireland 
Chapter 4 - Assessment of proiects and measures adopted under the cohesion 
financial instrument 
4.1. General 
4.1.1. Project assessment 
4.1.2. Revenue-generating projects 
4.2. Contribution to the reinforcement of trans-European transport networks 
4.3. Contribution to the implementation of environment policy 
y 
4.4. Appropriate balance between projects in the transport and environment sectors 
4.5. Assessment of compatibility with other policies 
4.5.1. Protection of the environment 
4.5.2. Common transport policy 
4.5.3. Competition policy 
4.5.4. Public procurement 
4.6. Socio-economic impact of the cohesion instrument 
4.7. Coordination and consistency with the other instruments 
4.7.1. Structural Funds 
4.7.2. DG VII budget line 
4.7.3. The Life programme 
4.7.4. The European Investment Bank 
4.8. The role of the European Investment Bank in assessing projects 
4.8.1. The principle 
4.8.2. Implementation 
4.9. Coordination with the Christophersen Group 
Chapter 5 - Monitoring and supervision 
5.1. Monitoring Committee: Spain 
5.2. Monitoring Committee: Portugal 
5.3. Monitoring Committee: Greece 
Ad hoc Committee 
5.4. Monitoring Committee: Ireland 
5.5. Commission inspections of the financial management of the projects approved 
5.6. Role of the EIB 
5.7. Fraud 
5.8. Legal proceedings in progress 
Chapter 6 - Information and publicity 
6.1. Annual report 
r 
6.2. Information to the Member States 
6.3. Information to the social partners 
6.4. Information to intereted parties 
6.5. Seminars on financial management 
6.6. Publicity measures taken by the Commission 
(a) Publication of decisions 
(b) Brochure 
(c) Posters 
(d) Audio-visual 
(e) Films 
(f) Videos 
(g) Miscellaneous 
6.7. Measures taken by the Member States 
(a) General 
(b) Forms of publicity 
Tecnical annexes are available by the European Commission, Secretariat General, Direction 
H-Cohesion Fund 
Avenue des Nerviens 9, B-1049 Brussels, Off. 7/8, Tel. 295.40.23 
€ 
PRELIMINARY NOTE 
This Report concerns decisions taken by the Commission on the basis of the cohesion 
financial instrument, which was replaced on 26 May 1994 by the Regulation 
establishing the Cohesion Fund. 
This means that the Report covers only decisions taken before that date. 
However, it does also deal with the monitoring, inspection and financial management 
of those decisions up to 1 November 1994. 
9-
INTOODUCnON 
The establishment and operation of the Cohesion Fund encountered a number of 
difficulties. 
The greatest of these arose from the delays in ratifying the Maastricht Treaty, which 
meant mat the Cohesion Fund could not be set up by 31 December 1993, as the 
second paragraph pf Article 130d EC required. 
However, the decisions taken by the Heads of State and Government at the Edinburgh 
Summit in December 1992, and specifically their decision to anticipate the effects of 
the Maastricht Treaty by establishing a cohesion financial instrument, enabled the 
impact of the delay to be minimized. Active and intense cooperation among the 
institutions, the Commission, the Economic and Social Committee, Parliament and the 
Council of Ministers itself, enabled this instrument to come into force on 1 April 
1993. 
The subsequent implementation of the financial instrument then suffered a further 
delay because the projects submitted by the four cohesion countries, Spain, Greece, 
Portugal and Ireland, were sent late and, in very many cases, in an incomplete form. 
Despite these problems, the Commission, which was responsible for management of 
the financial instrument, succeeded - in cooperation with those countries - in utilizing 
virtually all the commitment appropriations of ECU 1 565 million contained in the 
1993 budget. Substantial financial transfers amounting to about ECU 730 million were 
also made as advances in 1993. In order to do this, the Commission had to adopt over 
100 financing decisions in 1993. 
This effort was sustained in 1994 to the extent that projects had already been sent to 
the Commission for commitment from the 1994 budget. However, not all these 
difficulties could be overcome totally because the cohesion countries decided not to 
forward the bulk of applications until after the cohesion financial instrument had 
expired on 26 May 1994. This meant that most projects for 1994 could not be adopted 
under the instrument, which is the subject of this Report, but had to be dealt with 
under the Regulation establishing the Cohesion Fund, which replaced the instrument 
when it expired. 
As far as transport infrastructure projects are concerned, the Commission has ensured 
that all projects without exception concern trans-European transport networks or access 
to such networks, which in some cases meant anticipatory Commission proposals for 
those networks, as permitted by the financial instrument. This meant that all the 
finance could be concentrated on making the networks operational. 
In the case of the environment, the Commission introduced from the beginning a 
number of priorities in order to reinforce the implementation of key directives in this 
sector. Here it was guided by the Fifth Directive on the Environment and Sustainable 
Development adopted in 1992. 
£ 
The priority sectors are the supply of drinking water and the treatment of waste water 
and solid waste, including urban waste. Further environmental projects were also 
adopted to achieve the other objectives of the Fifth Programme, but the bulk of 
finance was concentrated on the implementation of the directives in the sectors 
mentioned. 
In this way, an appropriate balance could be achieved between the environment and 
the transport sector, even though in 1993 an excessive emphasis on the transport sector 
was noted in Spain. This will have to be corrected in 1994 if possible. This situation, 
which is understandable in the year in which a new instrument is launched, can be 
explained by the considerable increase in the financial resources available at Union 
level for the environment although the preparation of projects in this sector requires 
preparatory studies which, in most cases, cannot be completed so quickly. 
The Commission concluded a cooperation agreement with the European Investment 
Bank which provided extra project assessment capacity in the majority of cases. 
The close cooperation built up between various Commission departments also meant 
that the projects submitted could be examined more effectively and their compatibility 
with Community law, particularly in the areas of the environment and public 
procurement, checked. This led to over 5 000 inter-departmental discussions and all 
the decisions adopted by the Commission were based on inter-departmental agreement. 
A number of projects submitted were not adopted following appraisal by the 
Commission. The cohesion countries were informed of the reasons for these refusals 
and, in the vast majority of cases, withdrew the projects from the Cohesion Fund. 
Monitoring Committees were set up for monitoring and inspection purposes and have 
now looked at the implementation of all the projects selected. Overall, project 
implementation may be regarded as satisfactory, despite certain delays affecting 
environment projects in Spain, Portugal and Ireland. Only transport infrastructure 
projects in Greece give real cause for concern, as a result of problems in applying the 
rules on public procurement. The Commission has contacted the Greek authorities to 
seek a solution to this problem. 
A number of inspections have already been undertaken in each of the four countries 
and so far no cases of irregularity or fraud have been detected. 
The Commission has also supervised implementation of a number of information and 
publicity measures designed to raise awareness among the citizens of the Union and 
those closely involved in the work of the Cohesion Fund. 
~S 
The experience acquired during 1993 and the early months of 1994 has already been 
turned to good account in the form of a number of amendments to Community 
legislation. Comments by the Economic and Social Committee and the Committee of 
the Regions have also contributed to improving the legislative framework. Following 
Parliament's assent, a number of amendments by Parliament and the Council of 
Ministers were included in the Regulation establishing the Cohesion Fund, which 
came into force on 26 May 1994. 
The Commission has been pleased with the cooperation it has received not only from 
the other institutions of the Union but also the governments of the four cohesion 
countries and the European Investment Bank. The many contacts with the social 
partners, the circles concerned by projects and the bodies responsible for the 
implementation of projects have been of the utmost value. This support has enabled 
the Commission to inaugurate the Cohesion Fund in record time so that it can help 
give concrete reality to the goal of European solidarity which it symbolises. 
Through a number of already completed projects and a larger number of active 
construction sites, the European public is already seeing tangible evidence of the work 
of economic and social cohesion being undertaken by the Union's Cohesion Fund. 
•lo 
CHAPTER 1 The legislative and administrative background 
1.1. The Treaty of Maastricht and the protocol on economic and social cohesion 
The establishment of the Cohesion Fund by Article 130d of the EC Treaty, as amended by 
the Treaty of Maastricht, constitutes the most important of the changes made by the latter 
in the field of economic and social cohesion. 
While the Cohesion Fund represents a further stage in the policy of solidarity initiated 
mainly through the Structural Funds, this innovation makes its own specific and 
complementary contribution since it is grounded principally in the new requirements 
stemming from the prospect of economic and monetary union, which is already starting to 
become a reality. 
From the beginning, the Cohesion Fund has created its own identity on the basis of three 
major principles. 
The first is its limited field of implementation: the protocol on economic and social 
cohesion states that the Cohesion Fund "will provide Community financial contributions to 
... Member States with a per capita GNP of less than 90% of the Community average." 
This means that aid is directed at the least prosperous Member States, rather than, as in 
the case of the Structural Funds, designated regions located throughout the Union. 
Secondly, assistance is restricted to the part-financing of projects in the fields of the 
environment and trans-European transport networks. 
Thirdly, as a result of its links with the implementation of economic and monetary union, 
the Cohesion Fund assists Member States which have drawn up a programme complying 
with the conditions on excessive public deficits laid down in Article 104c. 
1.2. The Edinburgh European Council 
After the principle of the Cohesion Fund had been incorporated into the Treaty and criteria 
for eligibility set out in the Protocol, the European Council, meeting in Edinburgh on 11 
and 12 December 1992, adopted the general principles governing its operation on the basis 
of the proposal for a Regulation presented by the Commission in July 1992. 
That European Council also adopted the financial allocation to the Cohesion Fund, which, 
for the period 1993-99, will amount to ECU 15 150 million at 1992 prices. 
It also decided to establish a provisional instrument to provide Community financial 
support to the beneficiary Member States from 1993 while awaiting the entry into force of 
<"M 
the Mastricht Treaty, which would in turn permit establishment of the Cohesion Fund 
itself. The European Council asked the Commission to propose a Regulation to this effect. 
1.3. The cohesion financial instrument 
The Commission adopted the proposal for a Regulation establishing the cohesion financial 
instrument based on Article 235 of the Treaty on 23 December 1992"and decided to send 
it to the Council and, for consultation, to the European Parliament and the Economic and 
Social Committee. 
Parliament considered the draft Regulation and proposed a series of amendments. It gave 
its opinion on 11 March 1993. This opinion was considered by the Council and the 
Commission stated its views on Parliament's amendments as permitted by Article 149(3) of 
the Treaty. Parliament's main wishes, an assurance to the beneficiary Member States that 
they would be specifically named in the legislation, the need to ensure that a substantial 
proportion of the appropriations would be allocated to the environment by insisting on an 
appropriate balance between the environment and transport, the need for an adequate 
monitoring system to be established and an obligation to provide a wide range of 
information about Community financing, were incorporated into the final Regulation. 
The Council adopted the Regulation on 30 March 1993 and it came into force for a 
limited period of one year on 1 April 1993. It was subsequently extended until the end of 
1994. 
This meant that the Member States were able to submit their projects for 1993 and the 
Commission could commit all the budget appropriations for that year as soon as it had 
considered those proposals. 
1.4. The standard decision 
So that it could implement the provisions of the Regulation concerning the grant of 
assistance from the cohesion financial instrument and the Cohesion Fund in a uniform 
fashion, the Commission drew up a standard decision (see Annex ...) including an annex to 
the enacting terms which contains a description of the project adopted and standard 
annexes for all the projects which set out the provisions governing financing and 
monitoring, compliance with Community policies and conditions concerning information 
and publicity. 
This decision document was subsequently modified to take into account the changes 
introduced by the Regulation establishing the Cohesion Fund. 
This standardization offered legal certainty for decision making without preventing account 
being taken of the individual features of the projects since, depending on the nature of the 
operations financed, the decision adopted could include specific clauses and conditions. 
1 < 
1.5. Application form 
Before the entry into force of the cohesion financial instrument, the Commission drew up 
an application form for assistance which it sent to the Member States. 
This covers key information on the projects submitted (responsible authority, description, 
location, costs, grant requested, compatibility with Community policies, etc.) as required 
by the cohesion instrument Regulation. The form presents this information in a concise 
manner so as to facilitate the process of consultation within the Commission and generally 
provide a systematic basis for the handling of applications and the assessment of projects. 
Once the Regulation establishing the Cohesion Fund was approved, the application form 
was modified to take account of the strengthened provisions of the new Regulation as well 
as of experience acquired during application of the cohesion financial instrument. 
1.6. Monitoring arrangements 
Once the Commission had taken the first decisions approving projects they had submitted, 
the beneficiary Member States, acting in accordance with Article 9(9) of the Regulation 
establishing the cohesion financial instrument, set up Monitoring Committees. The early 
meetings of these Committees demonstrated that the most pressing need was better 
identification of the type of work carried out on each project. 
For that purpose, a form (see Annex VI) providing details of the implementation of 
projects was devised to collect the information required. This means that meetings of the 
Monitoring Committees can be better prepared with a clearer picture of the progress made 
and any problems encountered, particularly in terms of physical and financial indicators. 
The new monitoring form was sent to the cohesion countries once the Regulation 
establishing the Cohesion Fund had come into force. 
1.7. The Regulation establishing the Cohesion Fund 
Following the entry into force on 1 November 1993 of the Treaty of Maastricht, on 21 
December the Commission approved two proposals for Regulations, one establishing the 
Cohesion Fund and the other laying down implementing provisions. 
Pursuant to Article 130d of the Treaty, the Cohesion Fund was established by unanimous 
decision of the Council. A procedural innovation was that this was not done until the 
assent of Parliament and the advisory opinions of the Economic and Social Committee and 
the Committee of the Regions (newly established by Article 198a of the Treaty) had been 
received. 
-)3 
Article 130d as amended increases Parliament's powers over structural measures since its 
assent is now required before the Council adopts the Regulation. 
Establishment of the Cohesion Fund was Parliament's first opportunity to exercise its new 
powers over internal policy. Parliament adopted a large number of amendments, some of 
which did no more than reiterate the concerns it had expressed in its opinion on the 
cohesion financial instrument, from which the Cohesion Fund differed in a number of 
important respects. The first of these changes concerned the role of the regional and local 
authorities in monitoring projects part-financed by the Cohesion Fund. They could now be 
represented on the Monitoring Committees if they were responsible for the implementation 
of a project or, where appropriate, if they were directly concerned by a project. The 
second major change was that Parliament requested and secured the right to give its assent 
to the provisions for implementing the Cohesion Fund, which are annexed to the 
Regulation. Parliament has demonstrated flexibility, since it has accepted that these 
management provisions may be altered by the Council, acting by a qualified majority on a 
proposal from the Commission after receiving Parliament's opinion. 
The Council approved the Regulation establishing the Cohesion Fund on 16 May 1994 and 
it came into force on 26 May, replacing the cohesion financial instrument and providing 
the legal basis for assistance from the Fund. 
In response to Parliament's request, Annex II to the Regulation contains the implementing 
provisions which, in the Commission's original proposal, formed a separate Regulation. 
1.8. The Commission Regulation on irregularities 
To complement the Council Regulation, and as provided for in Article 12 thereof, the 
Commission adopted Regulation (EC) No 1831/94 of 26 July 1994, which completes the 
legislative provisions governing the work of the Cohesion Fund. 
This Regulation concerning irregularities and the recovery of sums wrongly paid in 
connection with the financing of the Cohesion Fund provides the Commission with a solid 
legal basis to combat fraud and the resources to establish an information system on 
irregularities. This is being established and will receive quarterly reports from the Member 
States. 
4 y 
FINANCIAL ASSISTANCE COMMITTED AND PAID BY THE FUND 
2.1 The budget available 
At the Edinburgh European Council in December 1992, the heads of state and 
government decided to grant the four beneficiary Member States ECU 15 150 million 
at 1992 prices for the period 1993-99. The annual breakdown of appropriations is as 
follows: 
Year 
Amount 1993 
1 500 1994 
1 750 1995 
2 000 1996 
2 250 1997 
2 500 1998 
2 550 1999 
2 600 TOTAL 
15 150 
Commitment appropriations for 1993 therefore totalled ECU 1 565 million and those 
for 1994 ECU 1 853 million. Payment appropriations amounted to ECU I 000 million 
and ECU 1 679 million respectively. 
The budget forecast for 1995 was accordingly set at ECU 2 152 million in 
commitment appropriations and ECU 1 750 million in payment appropriations. 
2.2 Breakdown by Member State 
An indicative allocation of these amounts was made as provided for in Annex I to the 
regulation establishing the cohesion financial instrument. This states that Spain will 
receive 52% to 58% of the total, Greece and Portugal 16% to 20% each and Ireland 
7% to 10%. 
AS 
These indicative brackets give the following figures: 
(ECU million) 
Member 
State 
1993 
1994 
1995 
1996 
1997 
1998 
1999 
TOTAL 
93/99 SPAIN 
52% 
780 
910 
1 040 
1 170 
1 300 
1 326 
1 352 
6 174 55% 
825 
962.5 
1 100 
1 237.5 
1 375 
1 402.5 
1 430 
8 332.5 58% 
870 
I 015 
1 160 
1 305 
1 450 
1 479 
1 508 
8 787 GREECE-PORTUGAL 
16% 
240 
280 
320 
360 
400 
408 
416 
2 424 18% 
270 
315 
360 
405 
450 
459 
468 
2 727 20% 
300 
350 
400 
450 
500 
510 
520 
3 030 IRELAND 
7% 
105 
122.5 
140 
157.5 
175 
178.5 
282 
I 060.5 9% 
135 
157.5 
180 
202.5 
225 
229.5 
234 
1 363.5 10% 
150 
175 
200 
225 
250 
255 
260 
1 515 
2.3. Implementation of the budget under the cohesion financial instrument 
Commitments undertaken by 31 December 1993 amounted to ECU 1 564.6 million, or 
99.9% of the appropriations available for that year. 
Table 1 shows the breakdown of commitments under the instrument by Member State 
and by field. 
-7 G 
Table 1 - APPROPRIATIONS FOR COMMITMENTS FOR 1993: ECU 1 565 million 
MS. 
GR 
ES 
IRL 
PO 
TOTAL 
Technical 
A ssistance 
TOTAL ENVIRONMENT 
175 222 400 
252 083 242 
55 917 250 
122 794 100 
606 016 992 
606 016 992 % 
62 
29 
39 
43 
38.7 
38.7 TRANSPORT 
105 141 600 
606 367 461 
85 969 850 
160 774 600 
958 253 511 
958 253 511 % 
38 
71 
61 
57 
61.3 
61.3 TOTAL 
280 364 000 
858 450 703 
141 887 100 
283 568 700 
1 564 270 503 
374 125 
1 564 644 628 BREAKDOWN 
% 
17.9 
54.9 
9.1 
18.1 
100 
0.02 
100 
The payment appropriations of ECU 1 000 million contained in the 1993 budget were reduced to 
ECU 800 million following a transfer of ECU 200 million. Of these appropriations, ECU 730.6 
million (91.7%) was utilized, leaving a balance of ECU 64.4 million (8.7%). 
Table 2 shows the transfers made to the recipient Member States. 
Table 2 - APPROPRIATIONS FOR PAYMENTS FOR 1993: ECU 800 million1 
MS. 
GR 
ES 
IRL 
PO 
TOTAL 
Technical 
A s si stance 
TOTAL ENVIRONMENT 
99 067 294 
119 120 124 
28 845 009 
31 513 629 
278 546 056 
278 546 056 - % 
66.9 
28.3 
42.6 
33.5 
38.1 
38.1 TRANSPORT 
49 048 861 
301 660 389 
38 828 602 
62 496 918 
452 034 770 
452 034 770 % 
33.1 
71.7 
57.4 
66.5 
61.9 
61.9 TOTAL 
148 116 155 
420 780 513 
67 673 611 
. 94 010 547 
730 580 826 
7 500 
730 588 326 BREAK 
DOWN 
% 
20.3 
57.6 
9.3 
12.9 
100 
100 
BALANCE OF PAYMENT APPROPRIATIONS: (800 000 000 - 730 588 326) = 64 411 674 (8.7%) 
For 1994, appropriations committed during the lifetime of the instrument (up to 26 May), 
including a carryover of ECU 136 300 from the previous year, amounted to ECU 311.8 million 
(16.8%) (Table 3). That brings to ECU 1 876.4 million the commitments under the cohesion 
financial instrument undertaken in 1993 and part of 1994. 
Table 3 - COMMITMENTS 1994 (partial) 
MS 
ES 
GR 
IRL 
PO 
TECHNICAL 
ASST 
TOTAL ENVIRONMENT 
18 946 395 
106 623 150 
18 571 650 
6 104 700 
150 245 895 TRANSPORT 
5 559 979 
12 403 200 
23 770 775 
119 523 660 
161 257 614 TOTAL 1 
24 506 374 
119 026 350 
42 342 425 
125 628 360 
136 300 
311 639 809 
The original budget was ECU 1 000 million; ECU 200 million was 
transferred under the Notenboom procedure. 
Of this amount, ECU 510 425 (ECU 374 125 committed in 1993 and ECU 136 000 
committed in 1994) was used for technical assistance measures. This represents 0.16% of 
total commitments and so is less than the ceiling of 0.5% laid down by the regulation. 
Of the ECU 1 679 million in payment appropriations plus ECU 64.4 million carried over 
from 1993, ECU 343.2 million (20.9%) was implemented. This comprised ECU 188.4 million 
(54.9%) of the commitments awaiting settlement at 31 December 1993, which totalled ECU 
834 million, and ECU 154.8 million (45.1%) as a first advance on 1994 commitments. Table 
4 gives a complete picture of the two years. 
TABLE 4 - BUDGET IMPLEMENTATION 1993/94 
M.S. 
Spain 
Greece 
Ireland 
Portugal 
Technical 
asst. 
TOTAL 
Allocation 
Carryover 
from 1993 1993 
Commitment 
854 450 703 
280 364 000 
141 887 100 
283 568 700 
374 125 
1 564 644 628 
1 565 000 000 % 
54,9 
17.9 
9.1 
18.1 
0.02 
100 1994 
Commitment 
24 506 374 
119 026 350 
42 342 425 
125 628 360 
136 300 
311 770 339 
1 853 000 000 
136 300 % 
7.8 
38.2 
13.6 
40.4 
100 Total 1 
878 957 077 
399 390 350 
184 229 525 
409 434 188 
510 425 
1 876 414 967 
3 418 136 300 % 
46.8 
21.2 
10 
21.8 
100 1993 
Payment 
420 780 513 
148 116 155 
67 673 611 
94 010 547 
7 500 
730 588 326 
800 000 000 % 
57.6 
20.3 
9.3 
12.9 
100 1994 
Payment 
33 440 810» 
62 299 852 
13 532 229 
133 939 020 
45 846 
343 257 757 
679 000 000 
64 411 000 % 
39 
18 
4 
39 
100 Total 2 
554 221 323 
210 416 007 
81 205 840 
227 949 567 
53 346 
1 073 846 083 
2 543 411 000 % 
52 
20 
7 
21 
100 Balance to pay 
(Tl - T2) 
324 735 754 
188 974343 
103 023 685 
181 484 621 
457 079 
802 568 884 % 
37 
47 
56 
44 
89 
* Including ECU 70.6 million from allocation 11 (1994 budget) and ECU 62.8 million from allocation 31 (carryovers) 
1 Still to be paid at 31 December 1993: (1 564 644 628 - 730 588 326) = 834 056 326 
2 The payment appropriations for 1993 were reduced by ECU 200 million from ECU 1 000 million to ECU 800 million. 
3 The payment appropriations for 1994 were reduced by ECU 350 million from ECU 1 679 million to ECU 1 349 million. 
4 The carryovers in 1994 amount to ECU 136 300 in commitment appropriations and ECU 64 411 000 in payment appropriations. 
V9 
2o 
2.3.1 SPAIN 
(a) Commitments in 1993/94: environment 
The Spanish authorities submitted a variety of projects in 1993 for financing under the 
cohesion financial instrument, covering such areas as water supply and waste treatment 
infrastructure, water quality control, erosion control, beach restoration, riverside 
management, nature conservation and industrial pollution control measures. Compared 
with the other cohesion countries, the applications thus ranged over a wider field of 
activities reflecting the particular circumstances and priorities of Spain. Because of the 
small-scale nature of many of the projects, these were frequently grouped for the purpose 
of granting assistance according to type and/or geographical location. 
Between April 1993 and May 1994 the Commission adopted 23 decisions relating to 65 
environment projects in Spain involving total eligible costs of ECU 318.8 million and 
assistance of ECU 270.99 million. 
Environment projects thus account for around 30.7% of the total amount of assistance 
granted to projects in Spain under the cohesion financial instrument up to the end May 
1994. 
The table below gives a breakdown of the projects approved by broad category, while the 
following paragraphs give more details, highlighting the most important projects within 
each category. All of the projects approved respond to the priorities outlined in the 
Community's Fifth Action Programme on the Environment and Sustainable Development 
and the objectives of Article 13Or of the Treaty. 
*1 
Spain - Environment projects approved April 1993 - May 1994 
Category 
Water supply 
Water quality control 
Sewage collection and 
treatment 
Erosion control and 
reafforestation 
Nature conservation 
Control of industrial 
pollution 
Other 
Total No of projects 
11 
9 
7 
20 
10 
6 
2 
65 Total 
eligible 
costs 
ECU million 
114 529 
37 843 
11 214 
105 994 
25 727 
22 170 
1 323 
318 801 CFI 
contribution 
ECU million 
97 350 
32 167 
9 532 
90 095 
21 868 
18 845 
1 134 
270 990 % 
35.9 
11.9 
3.5 
33.2 
8.1 
7.0 
0.4 
100.0 
Water supply 
This includes a number of projects aimed at improving or securing the supply of good 
quality water to areas suffering from the effects of drought and consequent water 
shortages. A number of the projects were initiated under the Spanish Government's 
emergency procedures because of the acute nature of the problems confronting the 
communities concerned, which include the cities of Madrid, Malaga, Seville, Oviedo 
and Ciudad Real, as well as certain important coastal areas. The projects primarily 
concern the installation of infrastructure for the transfer of drinking water from sources 
of supply to the communities which require it (pumping stations, pipelines, tunnels, 
purification plants, etc.). 
The most important projects in the group relate to securing the supply of water to 
Madrid by permitting the transfer of water from the Picadas reservoir to the Valmayor 
reservoir via a 32V4 km pipeline. Assistance from the cohesion financial instrument for 
this project, which was due to be completed at the end of 1993, amounted to ECU 
44.1 million. 
2£ 
Erosion control and reafforestation 
These projects consist of a series of measures throughout Spain aimed at tackling one 
of its most serious environmental problems: more than 40% of Spanish territory is 
affected by intense erosion processes, while it is estimated that around 18% of the 
territory requires urgent assistance. 
Two sets of projects were approved for assistance under the cohesion financial 
instrument. The first set is being undertaken by the National Institute for the 
Conservation of Nature (ICONA) and involves a series of measures in all the major 
Spanish river basins aimed at controlling erosion in seriously degraded areas, including 
reafforestation, improvement of existing vegetation and the stabilization of torrential 
channels. A total of ECU 50-88 million of assistance has been approved for this group 
of projects. 
The second set, granted a total of ECU 28.10 million of assistance, is being 
undertaken under the responsibility of the Ministry of Public Works and Environment 
(MOPTMA) and concerns a number of measures to control erosion of the watersheds 
of publicly-owned reservoirs. 
Water quality control 
A network of automatic early-warning stations (SAICA) aimed at monitoring water 
quality in all the major Spanish river basins is being financed by the cohesion 
financial instrument for a total of ECU 32.17 million. The projects, being undertaken 
under the responsibility of the General Directorate for Water Quality, will involve the 
design and installation of 14 of these stations in order to transmit key data on water 
quality changes in major river sections by satellite using the VSAT system. This is an 
important project aimed at improving information flows and enabling more rapid 
action to be taken to tackle pollution discharges. 
Nature conservation 
A series of measures has been financed under this heading in the Spanish National 
Parks in order to meet public demand and minimize the harmful effects of the flow of 
visitors on habitats and species. These projects accounted for ECU 16.45 million of 
assistance from the cohesion financial instrument. An additional series of measures has 
been financed in the National Parks, to a total of ECU 5.4 million, to redress the 
damage done to ecosystems by human activity, to eliminate alien species and to 
prevent the destruction of ecosystems as a result of fire, 
Sewage collection and treatment 
A number of projects have been financed under this heading to provide the 
infrastructure for the collection and treatment of waste water. In total the projects 
accounted for ECU 9.5 million of assistance. 
Industrial pollution control 
Under this heading the cohesion financial instrument financed part of the Spanish 
Government's important programme to help industry introduce new technology aimed 
at reducing the production of waste and polluting materials or liquids (Programa 
Industrial para la Tecnologia Medioambiental-PITMA). A total of ECU 18.85 million 
of assistance was granted for a series of small projects undertaken in 1993 concerning 
the following main areas: 
- reduction and purification of waste water spillages, 
- elimination of waste liquid in olive presses; 
- management of industrial waste; 
- management of used oils; 
- collection and disposal of marine oils; 
- restoration of soil; 
(b) TRANSPORT 
The Commission adopted 25 decisions approving 31 transport infrastructure projects in 
Spain to be financed from the cohesion financial instrument. 
The eligible costs of the investment totalled ECU 716 070 514 at the time the 
decisions were adopted. Assistance from the cohesion financial instrument amounted 
to ECU 604 124 151, 84.37%'of the eligible costs. 
The breakdown by mode of transport was: 
- . roads 71.9% 
railways 14.7% 
airtransport 12.1% 
sea transport 1.3%. 
The total commitment from the cohesion financial instrument was ECU 598 564 172 
the 1993 budget and ECU 5 559 979 from the 1994 budget. 
(i) Roads 
The road projects approved form part of the general plan for roads in Spain and the 
trans-European road network, and access thereto. All projects concerned either the 
network or access to it. 
The projects as a whole will improve communications between the peripheral regions 
of Spain and France or Portugal; some of them will improve the continuity of the 
network close to urban centres. 
Three projects will help complete the northern and western sections of the Madrid 
bypass (M-40) providing a continuous route and linkage between the various approach 
routes to the capital. 
A motorway project and three technical studies on motorway projects concern the 
radial roads to Madrid: 
Madrid-Valencia: construction of a section of expressway between 
Requena and Chivas and the first phase between Atalaya del Canavete 
and Caudete de las Fuentes; 
the Rias Bajas expressway will link Galicia and northern Portugal to the 
centre of the peninsula and to the route from Bordeaux to the 
Portuguese frontier via Valladolid; 
the Madrid-Valencia expressway will link Madrid to one of the largest 
urban centres on the peninsula; 
the Bailén-Granada expressway will provide eastern Andalusia with 
access to the main routes and provide a missing link in the main north-
south route. 
Eight road projects concern the east-west or peripheral routes and will provide 
connecting links in the Spanish network: 
the Adra bypass and a section of the Trinidad-Montgat motorway on the 
Mediterranean spine; 
the Gilet-Soneja section of the Sagunto-Zaragoza-Somport route; 
the new road between Las Duenas and Novellana on the northern route 
between Asturias and the Basque Country; the eastern ring road around 
Valladolid on the Bordeaux-Valladolid-Salamanca route; access to 
Santiago on the western route in Galicia, the new Lardero spur on the 
Barcelona-Zaragoza-Burgos route. 
(ii) Railways 
The rail projects approved are all intended to improve the quality of the network 
linking the five largest cities in Spain, Madrid, Barcelona, Valencia, Zaragoza and 
Seville. With the exception of the line from Madrid to Seville, long-distance routes 
have top speeds below current needs and are often single track. 
The first four of these cities are located on the Madrid-Valencia-Barcelona triangle. 
The projects approved have the following aims: 
modernization, adaptation and doubling of the existing lines between Madrid 
and Valencia and Valencia and Tarragona to allow speeds of 220 kph; 
study for a high-speed train route on two sections of the Madrid-Zaragoza-
Valencia line. 
A project in Seville concerns linking the international-gauge high-speed network with 
the wide-gauge national network, so permitting traditional trains (e.g. Talgo) to operate 
on both. This project is now completed and operating. 
(ii) Airports 
Air traffic between the island regions of Spain is constantly growing. The growth of 
tourism and improved access to the islands justifies finance for airport infrastructure. 
The projects approved concern various works at the two airports on the Canary Islands 
(Hierro and Tenerife) and a terminal at Palma de Mallorca airport in the Balearics. 
?6 
These projects will increase capacity and the quality of services in the remoter and 
most remote regions. 
(iii) Sea transport (Vessel Traffic System) 
Five large ports of strategic importance for sea transport off the Spanish coast have 
been selected for the installation of systems to monitor traffic at sea and fight 
pollution. The areas concerned are the Bay of Biscay, the northern Atlantic, the Strait 
of Gibraltar, the northern Mediterranean and the Canary Islands in the south Atlantic. 
Since these projects will help improve the environment, half the cost of the investment 
involved has been charged to the environment sector and half to transport 
infrastructure. 
2.3.2. PORTUGAL 
(a) Environment 
Portugal's environmental priorities coincide with the priorities selected by the 
Commission for assistance from the cohesion financial instrument, i.e. provision of the 
infrastructure required to implement Community directives on the supply of drinking 
water and the treatment of waste water and other waste. 
The Portuguese authorities decided to submit for assistance from the cohesion 
financial instrument projects in the water and waste sectors located almost exclusively 
in the three regions with the largest urban concentrations, Lisbon, Oporto and the 
Algarve. The projects cover a number of municipalities, which contribute to their 
design and management. 
The exceptions to this geographical criterion are projects intended to solve particularly 
serious environmental problems, the urgency of which requires rapid and sometimes 
large-scale assistance. 
The geographical concentration of assistance has meant that these projects have a 
significant impact even though each individual measure is small. This approach has 
allowed rationalization of the submission of applications and there now exist coherent 
groups of projects defined in geographical terms by area and objective. This makes 
Community assistance more effective, as required by the rules. 
1.1 Provision of drinking water 
In 1990 only 77% of the population of Portugal had access to mains drinking water, a 
figure still below the Community average of 95%. A considerable part of the existing 
systems did not offer water of the quality required by the Community directives. 
The aim of the assistance requested form the cohesion financial instrument is to help 
reduce this gap in the period up to 1999 through a set of eight projects. 
Virtually all these projects concern the expansion and improvement of systems for 
utilizing water from the Tagus by means of the Castelo de Bode reservoir, which 
supplies water to the 2.5 million inhabitants of Lisbon. 
The works in progress will increase the capacity of the Asseiceira treatment station 
and of the main supply pipe. They will also improve security of supply. 
In the Algarve, the cohesion financial instrument is helping finance a watei; supply 
system which will link the Odelouca dam to the treatment station and networks 
supplying municipalities. 
These measures form part of a large-scale project intended to increase supplies of 
drinking water to the western coastal area of the Algarvé (the Barlavento). Future 
stages of this project will also receive finance from the Cohesion Fund. 
The only project which does not form part of the major systems described above 
concerns finance for the Enxoé dam. This is intended to supply two municipalities in 
the Alentejo, a region which suffers from serious shortages of drinking water because 
of continuing droughts in recent years and the poor quality of the resources available. 
1.2 Waste water treatment 
The situation as regards the treatment of waste water in Portugal in terms of 
compliance with Community legislation means that substantial investment must be 
undertaken within a relatively short space of time. 
In 1990 55% of the population of Portugal was connected to mains drainage and only 
21% had collection and treatment systems. The Community averages were 86% and 
78% respectively. 
The aim of assistance from the instrument is to help reduce this gap and implement 
the Community directives within the periods laid down. 
Altogether, 11 projects have been submitted, some in the urban areas of Lisbon and 
Oporto and others in areas where pollution levels require urgent assistance on an 
integrated basis. 
In Lisbon and Oporto, the work in' progress is designed to clean up coastal areas and 
forms part of integrated systems including collection, treatment and under-sea disposal. 
These systems, which will be introduced in stages, ensure coherent assistance and 
should ensure that resources are effective in terms of objectives. 
A second group of projects is concerned with cleaning rivers (the Ave, Aviela and 
Trancao) where pollution levels are very high as a result of discharges of untreated 
<?f 
waste urban and industrial water. These are fairly large-scale measures which will both 
reduce pollution in the rivers and, as a consequence of the level of treatment to be 
installed, the reuse of water and so more efficient management of water resources. 
A third group of projects concerns the treatment of waste water from towns in the 
Algarve in the Ria Formosa area, a nature park classed as a wetland of international 
importance and area enjoying special protection under Directive 79/409/EEC on the 
conservation of wild birds. 
These projects also form part of a broader range of assistance, further stages of which 
will be submitted to the Cohesion Fund in the years to come. 
1.3 Waste 
Portugal produces less urban waste than the Community average and, although 
disposal systems cover only 42% of the population, needs are less urgent than is the 
case for water. This is the reason why only four projects, two of which are studies, 
have been submitted in this area. 
In the Oporto region, the cohesion financial instrument is financing the initial stages 
of installing a large-scale incineration plant and in the Baixo Mondego area it is 
providing support for a controlled discharge system which will form part of a more 
complex integrated system to be completed in a number of stages. 
Proiects approved 
During the lifetime of the cohesion financial instrument, 22 projects were adopted in 
Portugal, including four studies, and assistance totalled ECU 128 899 000. 
The breakdown by type of project is as follows: 
Type of project 
Drinking water 
Waste water 
Waste 
TOTAL No 
7 
11 
4 
22 % 
32 
50 
18 
100 Cohesion 
instrument 
assistance 
53.1 
65.4 
10.4 
128.9 % 
41 
51 
8 
100 
(b) TRANSPORT 
The main concern raised by the strategy which Portugal is following is to ensure that 
assistance from the cohesion financial instrument is able to assist appropriate linkage 
to trans-European transport networks. This is particularly important since the country's 
location on the edge of the Community makes an effective transport system a matter 
of urgency. 
Roads 
The very high rate of growth in trade with the rest of the Community since accession, 
particularly using road transport, has drawn attention to the need to continue the work 
of constructing and modernizing road and rail links with the rest of Europe. This is the 
only way to reduce operating costs, reduce journey time and improve traffic safety. 
From the main routes which make up Portugal's basic road networks, which is fully 
integrated into the trans-European network, three have been selected as major priorities 
in order to concentrate assistance from the instrument to some degree. These are 
completion of the Valença-Vila Real de S. Antonio towards the north as far as the 
Spanish border, rapid opening of the Portuguese section of the Lisbon-Madrid route 
and faster construction of the road from Lisbon to Valladolid, which appears on the 
list of Category I infrastructure projects drawn up by the Corfu European Council. 
In addition to constructing new infrastructure, attention is also being paid to the need 
to increase traffic capacity on certain sections by providing finance to widen 
motorways. This has removed major bottlenecks on the Valença-Vila Real de S. 
Antonio road, thereby improving traffic flow and road safety. 
High priority has also been given to reducing congestion in urban areas by financing 
bypasses, whose main function is to promote links between different forms of 
transport away from town centres. 
Lisbon's inner and outer ring roads, CRIL and CREL, are helping remove serious 
bottlenecks hampering traffic in the Lisbon metropolitan area by improving operation 
of urban road links and offering certain environmental advantages; 
3D 
Rail 
The main strategic objective of rail infrastructure is to inject fresh dynamism into the 
main links between Portugal and the centre of Europe while helping ensure that this 
mode of transport can offer a real alternative to roads through its greater effectiveness 
in moving people and goods. 
Two lines, the northern and the Beira Alta, both of which form an integral part of the 
trans-European network and are of strategic importance to Portugal. The amount of 
investment required is such that the ERDF is providing assistance alongside the 
instrument. 
The general projects to modernize these lines comprise principally electrification, 
increasing the number of tracks, signalling and the replacement or strengthening of 
bridges and tunnels to increase maximum speeds and so achieve substantial reduction 
in journey times in both cases. 
Sea transport 
Portugal's geographical position and the comparative scarcity of land links with 
Europe provides adequate justification for the promotion of sea transport which will 
enable this mode to recover the important role which it traditionally played in 
Portugal's foreign trade. 
The aim is to improve the operation of Portugal's ports while ensuring that they are 
integrated into the trans-European networks through appropriate multimodal links. 
The instrument has provided assistance for investments likely to improve access and 
links between different modes of transport and improve the quality and range of port 
services. 
However, in view of the highly competitive nature of the sea transport sector at 
present, efforts should be concentrated on those ports which are most likely to become 
competitive. 
A study on the ports on the Atlantic coast should be carried out as soon as possible to 
guide measures financed by the instrument in this area and avoid the creation of 
surplus capacity. 
Proiects approved 
In 1993, 10 projects were adopted in Portugal and received assistance from the 
instrument amounting to ECU 159 125 000 and four studies received ECU 1 649 000. 
The breakdown by mode of transport of the total contribution from the instrument for 
1993 is as follows: 
Type of 
Project/Study 
Roads 
Railways 
Ports 
Total /NO; 
6 
2 
6 
14 Cohesion 
instrument 
assistance 
(ECU million) 
115.6 
39.4 
5.7 
160.7 % 
72 
24.5 
3.5 
100 
Between the beginning of 1994 and 26 May, six projects and two studies were 
approved; the assistance granted amounted to ECU 119 247 000 and ECU 277 000 
respectively. 
The breakdown of the total contribution from the instrument in 1994 by mode of 
transport is as follows: 
Type of 
Project/Study 
Roads 
Railways 
Ports 
Total No 
2 
1 
5 
8 Cohesion 
instrument 
assistance 
(ECU million) 
101.6 
5.1 
12.8 
119.5 % 
85 
4.3 
10.7 
100 
2.3.3. GREECE 
(a) ENVIRONMENT 
The state of the environment in Greece may be regarded as satisfactory. It is varied in 
nature, rich in biotopes and offers a remarkable degree of diversity. In places, there 
are certain local problems, such as atmospheric pollution in the major cities. 
However, throughout the country there is a considerable lack of infrastructure for the 
supply and distribution of water, the treatment of waste water and the management of 
waste. 
In line with the Cohesion Fund's objective of promoting economic and social 
cohesion, it has contributed to the improvement of infrastructure and the completion of 
missing links and to the protection of nature and historical remains. 
Assistance from the Fund to environmental measures in Greece in 1993-94 accounted 
for 70% of Community assistance to that country. 
The breakdown of assistance by objective is as follows: 
water supply 46% 
waste water treatment 17% 
waste management 1% 
nature protection 4% 
historic sites 2% 
Assistance in the field of the environment is in line with the aims of the Fifth 
Programme. 
The first objective concerns the management of water resources. It is essential to 
ensure adequate supplies of water^ sound management of water resources, good quality 
drinking water and a balance between the supply of and demand for drinking water. 
The second aim is to provide Greece with infrastructure for the purification and 
treatment of waste water and help it meet its obligations under the Community 
directives. 
The third objective concerns the management of waste in line with the Community 
strategy for 2000. 
The fourth objective is to contribute to combating forest fires, which devastate many 
areas of Greece every year. The Cohesion Fund is also aware of the need to protect 
nature and the historical sites in cities and towns and to create green areas. 
Water supply 
Cohesion Fund assistance for drinking water has been concerned primarily with 
resolving problems of quality and quantity. It also includes a project to clean up 
ground water. 
These projects include one major project concerning water supplies to Athens from the 
river Evinos. The Community has contributed ECU 166 million to this and a number 
of small projects throughout the country including Crete (Rethymnon), the 
Peleponnese (Nafplion, Tripolis, Argos, Patras), western Greece (Lamia, Livadia, 
Chalkida, Larissa, Volos, Trikala) and Macedonia (Veria, Katerini, Yiannitsa). 
In assisting the project to supply water to Athens, the Cohesion Fund has paid 
attention to the sound management of water resources and improving water supplies to 
the capital. This project is urgent because of the drought which has afflicted Greece in 
recent years. 
Projects to supply water to other towns have concentrated on tourist centres, parks and 
industrial centres. 
The project to clean up ground water concerns desalination in the Argos plain. 
Purification of waste water 
A large number of projects concerning the treatment of waste water and mainly urban 
effluent have been part-financed in several large and medium-sized regional centres. 
This part-financing is directed at the first stages of projects which will be continued 
by the Cohesion Fund. The large number of projects offers Greece an important 
advantage in this field. 
Specific clauses provide the Cohesion Fund with assurance that the distribution and 
treatment of water will be considered as an operational whole. 
Some twenty projects have been part-financed in Macedonia and Thrace. The largest 
are those in Thessaloniki (second phase of biological treatment), Kavala, 
Alexandroupolis, Katerini and Veria. 
There are some projects in Epirus, some in central Greece (Chalkida, Lamia), about 
ten in the Peleponnese (Corinth, Argos, Patras, Kalamata), the same number in Crete 
(Heraklion and Chalkis) and some in the islands (Lesbos and Chios). 
Waste management 
Waste management has not received the attention which the Commission hoped for; 
the projects submitted to the Cohesion Fund are few in number and concern mainly 
the creation or improvement of discharges at Shisto, Liossia, Zante, Thessaloniki and 
Patras. 
Acting in cooperation with the Greek authorities, the Cohesion Fund hopes to extend 
and diversify its work in this field in line with the Community strategy. 
Nature protection 
During this period, the Fund has concentrated assistance on combating forest fires 
through fire-fighting and reafforestation measures. Forest fires are a major problem in 
Greece. 
Protection of the heritage, historic sites and the creation of green areas 
The Cohesion Fund provides assistance in two ways. The first concerns the old 
commercial centre of Athens and the creation of green areas. The second deals with 
the restoration of archaeological monuments, principally in Athens and Elefsis, relating 
them to economic activity and linking them with green areas. 
3J-
(b) TRANSPORT 
Introduction 
Under the cohesion financial instrument, 18 decisions concerning projects or stages of 
projects dealing with all forms of transport were adopted. Their total cost is ECU 138 
million and assistance from the Fund totals ECU 117 million. This means that the 
contribution from the fund in all cases is 85% of the total cost. 
Of these decisions, 15 concern the initial stages of projects. Normally, the Cohesion 
Fund will provide finance for future stages of these projects. 
The breakdown of assistance by type of transport is as follows: 
Road - Motorways 
RaiIways 
Airports - Air Traffic 
Control 
Ports Number 
of 
projects 
12 
2 
3 
1 
18 ECU 
(Mi liions) 
85 
14 
15 
3 
117 % 
of total 
transport 
72,5 
12 
13 
2,5 
100 
Roads and motorways 
Finance for motorways is by far the largest of the projects approved, accounting for 
72.5% of the total. 
The bulk of this finance is going to two major routes: Pathe (Patras-Athens-
Thessaloniki-Bulgarian frontier) and the Via Egnatia (from the Port of Igoumenitsa to 
the Turkish frontier). 
The breakdown of assistance by section of road is as follows: 
Total assistance % of 
(ECU million) total for motorways 
(a) PATHE 
Patras bypass 4.151 
Yliki-Agios Konstantinos 22.355 
Raches-Pelasgia 8.942 
Skotina-Katerini 6.387 
Thessaloniki-Serres-Promachon 3.513 
TOTAL PATHE 45.350 53% 
(b) EGNATIA 
Igoumenitsa-Psylorachi 5.655 
Psylorachi-Pedini 4.418 
Poly milos-Veria 4.790 
Rentina-Strymonas 12.775 
Kavala bypass 7.984 
TOTAL EGNATIA 35.602 42% 
(c) OTHER (access to Pathe and Egnatia) 
Kardia-Kalikratia 959 
Korinthos-Tripoli-Kalamata 3.194 5% 
TOTAL OTHER 4.153 
Total motorways 85.105 * 100% 
Rail 
Finance for rail projects will contribute to completion of the double track between 
Athens and Thessaloniki and the modernization of existing lines. The projects 
approved were: 
Assistance (ECU) 
Double track 
Evagelismos-Leptokarya 9 690 
Extension of line 
Paleofarsalos-Kalabaka 4 271 
Total for railways 13 961 
Airports and air traffic control 
These projects concern completion of a new terminal at Corfu airport, modernization 
of an alternative landing runway at Athens airport and the purchase and installation of 
two radars at Thessaloniki and Rhodes airports. The allocation of funds is as follows: 
Amount (ECU'000) 
Corfu airport 2 565 
Athens airport 1 282 
Modernization of air traffic 
control facilities at Thessaloniki 
and Rhodes 11 478 
Total for airports 15 325 
Ports 
Finance for the first stage of construction of a quay in the port of Igoumenitsa has 
been approved. This port is the western end of the Via Egnatia and could offer the 
main sea transport link for traffic between Greece and the rest of the European Union. 
The assistance approved amounts to ECU 3 million. 
2.3.4 Ireland; overview 
Between April 1993 and May 1994, the Commission approved 55 decisions granting a 
total of ECU 182.9 million in assistance to Ireland of which ECU 108.4 million, or 
59.3% of the total, was for transport projects and ECU 74.5 million, or 40.7%, was for 
environmental projects. 
The table below gives a breakdown of projects by category: 
COMMITMENT OF AID TO PROJECTS IN IRELAND: 
APRIL 1993 - MAY 1994 
Transport 
1. Roads 
2. Rail 
3. Ports 
4. Airports 
Total Number of 
projects 
11 
7 
4 
1 
: :: I" -:'23;:,: .:,,;;; Assistance 
granted 
(ECU million) 
71.4 
20.1 
13.6 
3.3 
|yV:":k JW^:-V;-". % of total 
39.0 
11.0 
7.4 
1.8 
593 
Environment 
1. Water treatment 
2. Water supply 
3. Solid waste 
4. Habitat 
Total Number of 
projects 
23 
6 
2 
1 
:-^^: 32 Assistance 
granted 
(ECU million) 
44.6 
21.5 
7.6 
0.8 
—-v.Y 74.5 :''•.",:.; % of total 
24.4 
11.8 
4.2 
0.4 
40.7 
" —~ : 1 
GRAND TOTAL 55 182.9 100 
(a) ENVIRONMENT 
Ireland's natural environment is already of high quality. Nevertheless, the standards for 
drinking water and the treatment of urban waste set by Community law are not fully 
met in all areas. In 1993 the Irish Government therefore submitted for part-financing 
under the cohesion financial instrument 41 projects in the field of the environment 
covering mainly the areas of waste treatment and water supply infrastructure, nature 
conservation and solid waste management projects. Because of the situation in Ireland, 
many of the projects have been of small size but have had and will continue to have 
in Irish terms a significant impact on the water quality situation in that country. 
Between July 1993 and May 1994, 32 environmental projects were approved for 
Ireland, committing ECU 74.5 million from the budgets for 1993 and 1994. 
Of this amount, 62% went to sewage scheme projects, 27% to water supply schemes, 
10% to solid waste management projects and 1% to a heritage project. The 
contributions and locations in question are shown in the tables below. 
Waste water treatment 
In all, 23 projects were approved and received 44.6% of the total aid granted. These 
projects took 60% of the total commitment of environmental projects in Ireland, which 
indicates the priority biven by the Irish Government to efforts in this field. 
The target of the Irish environmental action programme is the elimination of all 
pollution of inland waters by sewage discharges by 2000. The cost of these 
investments has been estimated at about IRL 230 million (ECU 184 million). A further 
IRL 400 million will be required to upgrade treatment facilities for coastal areas and 
towns. The attached chart shows the locations of the coastal schemes and inland 
sewerage schemes funded by the cohesion financial instrument. The most important 
scheme has been the provision of secondary treatment for the Dublin area. 
Beyond.this project planning and parly initial construction phases of sewage tretment 
schemes in Cork, Drogheda, Dundalk, Waterford, Wexford and other costal tretment 
schemes have been funded. Moreover inland treatment plants at Athy, Clonmel, 
Limerick, Robertstown and other locations have been also co-financed by 85% to 
reach the ambitious target. 
The projects which received Cohesion Fund assistance were the following: 
Project 
Number 
93/07/61/003 
93/07/61/007 
93/07/61/009 
93/07/61/013 
93/07/61/014 
93/07/61/016 
93/07/61/017 
93/07/61/018 
93/07/61/020 
93/07/61/021 
93/07/61/022 
93/07/61/023 
93/07/61/024 
93/07/61/025 
93/07/61/026 
93/07/61/027 
93/07/61/028 
93/07/61/031 
93/07/61/032 
93/07/61/033 
93/07/61/034 
93/07/61/035 
93/07/61/037 
TOTAL Project Name 
Robertstown Sewerage Scheme 
Dublin Howth Sewerage Treatment 
Tramore Sewerage Scheme 
Dublin Ringsend and Dublin North Sludge 
Treatment 
Dublin (Ringsend) Sewerage Treatment 
Westport Sewerage Scheme 
Cork City Main Drainage 
Drogheda Main Drainage 
Dundalk Sewerage Scheme 
Waterford Main Drainage 
Muinebheag Sewerage Scheme 
Clonmel Sewerage Scheme 
Mitchelstown Sewerage 
Wicklow Town Sewerage 
Athy SeweFage Scheme 
Ballinrobe Sewerage Scheme 
Ennis Main Drainage 
Wexford Main Drainage 
Enniscorthy Main Drainage 
Dun Laoghaire Main Drainage 
Galway Main Drainage Scheme 
Limerick City Main Draihage 
Bray Sewerage Scheme Project/Stage 
Project 
Stage I 
Stage I 
Stage I 
Stage 1 
Stage I and II 
Stage I 
Stage I 
Stage I 
Stage I 
Project 
Stage I and II 
Stage I 
Stage I 
Stage I and II 
Stage I and II 
Project 
Stage I 
Stage I 
Stage I 
Stage I 
Stage I 
Stage II Aid granted 
(Mecu) 
1.3 
1.6 
0.6 
1.6 
2.4 
2.3 
2.6 
2.1 
1.3 
18 
2.8 
2.5 
1.5 
0.4 
2.5 
4.2 
1.2 
4.5 
1.6 
1.3 
2.3 
0.8 
1.4 
44.6 
Water supply 
The estimated commitment to the further investment to reach standards for drinking water 
of Mio IR 300 has been supported by the contribution of the Cohesion financial 
instrument to six projects improving the water distribution facilities all over Ireland (see 
attached chart). 
21.46 % Mecu equivalent to 29 % of the environmental share has been contributed by the 
Community to improve or secure the supply of good quality water to areas requiring a 
higher volume of drinking water or suffering from effects of pollution. The projects will 
involve treatment facilities for using water sources and connection systems to existing 
water supply networks. Probably the most important project is the Ballymore Eustace 
project to develop this major water source for the Dublin area. 
The projects assisted were the following: 
Project 
Number 
93/07/61/012 
93/07/61/015 
93/07/61/029 
93/07/61/036 
93/07/61/038 
93/07/61/041 
TOTAL Project Name 
Dublin (Ballymore Eustace) Water Supply 
Dublin Water Distribution 
Tuam Regional Water Supply 
Limerick City Water Supply 
Lough Mask Regional Water Supply 
Ballyjamesduff Regional Water Supply 
Scheme Project/Stage 
Stage I 
Stage I 
Stage I 
Stage I 
Stage I 
Stage I 
;• Aid granted 
(Mecu) 
5.3 
9.4 
2.8 
1.2 
1.7 
1.1 
21.5 
Il 
Solid Waste 
The remaining three projects taking 8.44 Mecu Cohesion Fund contribution equivalent to 11% 
of the environmental share concerned two landfill projects with attached modem waste 
management facilities and one project to preserve an exceptional raised bog area at Clara. 
The projects were the following: 
Project 
Number 
93/07/61/011 
93/07/61/039 
93/07/61/040 
TOTAL Project Name 
Clara and Raheenmore Bogs 
Ballymount Waste Facility 
Tralee Landfill Site Project/Stage 
Stage I 
Project 
Project Aid granted 
(Mecu) 
0.8 
6.6 
1.0 
8.4 
M3 
| COHESION FUND Ireland 1993/94: Environmental Projects 'm 
Solid Waste Schemes 
10% 
Water Supply Schemes fj|^^^^^^^^^^^^^^ 
29% 19L^L^L^L^Ir^ 
Sewage Schemes 
44,587,600 Water Supply Schemes 
21,459,100 Heritage Projects 
1% 
Solid Waste Schemes 
7,618,550 y 60% 
Heritage Projects 
823,650 TOTAL 
74,488,900 
Amounts in ECU ANREP-1.XLS 
*H 
COHESION FUND IRELAND 
Sewage Scheme Projects 
Dublin (Howth) 
Dublin Ringssnd 
Dun Laoghaire 
vgnnitcorthy 
Wexford 
M*r-
COHESION FUND IRELAND 
Water Supply Projects 
OUBLIN 
COHESION FUND IRELAND 
Solid Waste Management Projects 
Vf 
(B) IRELAND : TRANSPORT SECTOR 
Roads 
Between April 1993 and May'1994, 11 road projects were approved, the total cost of 
which was ECU 84 million. Total aid granted was ECU 71.4 million, or 85 % of the cost 
in each case since none of the projects was considered to be revenue generating. 
All of the road projects approved, with one exception (see below), are on the main 
corridors of the trans-European Road Network. The four main corridors are: 
North - South: Belfast - Dublin - Rosslare - Cork 
South - West: Dublin - Limerick and Cork 
East - West: Dublin - Galway and Sligo 
Western: Rosslare - Waterford - Limerick - Galway - Sligo 
Concentration on the major corridors is a long-established policy intended to make a significant 
difference to travel times on the most heavily used sections of the road network. 
The projects which received Cohesion Fund assistance were the following: 
Route 
Nl Dublin - Belfast 
Dublin Ring Road 
Nl 1 Dublin - Rosslare 
N25 Rosslare - Cork 
N8 Rosslare/Dublin - Cork 
N4 Dublin - Sligo 
TOTAL Project Name 
Balbriggan By-pass 
Drogheda By-pass 
Dunleer - Dundalk road 
Northern Cross 
Killarney Road interchange 
Enniscorthy - Wexford 
Killongford - Dungarvan 
River Lee Tunnel 
Longford By-pass Projector 
stage of 
project 
stage 
stage 
stage 
stage 
project 
project 
project 
stage 
project Aid granted 
(ECU million 
1.6 
1.6 
2.7 
16.0 
3.6 
5.4 
2.5 
2.7 
7.1 
43.2 
In addition, a group of twelve similar road improvement projects, called the integrated road 
network improvement scheme, received ECU 25.5 million of assistance. These projects involve 
road widening and strengthening of sections of the main corridors. This type of investment is 
intended to be a cost-efficient method of increasing road capacity and safety and allow for 
higher average speeds on parts of the network where the traffic density does not justify the 
' construction of new roads on new alignments. 
The one exception to the concentration on projects on the major road corridors was the approval 
of a new access road from the N25 Cork-Rosslare route to the new container terminal at 
Belview, downstream from the port of Waterford, for which assistance worth ECU 2.8 million 
was granted. This replaces the previous substandard access road and complements Community 
investment already undertaken in the port. 
Rail 
The projects assisted between April 1993 and May 1994 were the following: 
Name Type of project Assistance 
granted 
I 1 I (ECU million) | 
Dublin - Cork Mainly track and signalling replacement 17.0 
Dublin - Belfast with associated infrastructure works e.g. 
Limerick Junction - Limerick bridge strengthening and fencing 
Dublin - Galway 
Dublin - Waterford 
Track Renewal Equipment Purchase of rail-laying equipment 2.4 
Belview Rail Access Bridge and level crossing access to port 0.6 
TOTAL 20.1 
The rail projects focus on the main routes radiating from Dublin and include thé Cork-Dublin-
Northern Ireland border section of the network, which forms part of one of the priority projects 
identified by the Christophersen Group. The projects mostly involve the up-grading of the basic 
rail infrastructure by the replacement of jointed rails on wooden sleepers with continuous 
welded rail on concrete sleepers together with the up-grading of the signalling system and 
associated infrastructure works to allow for significantly faster journey times on the main inter-
urban routes. 
The seventh project listed above will improve access to the new container terminal at Belview 
and is intended to optimise previous Community investment in the port. 
The rate of assistance from the cohesion instrument to the seven rail projects was 85 % in all 
cases. 
y x 
Porte 
Four port projects received Cohesion Fund assistance between April 1993 and May 1994. All 
four projects, together with the two road and rail access improvements for the port of Belview 
mentioned earlier, are intended to improve the infrastructure of the four largest ports, which are 
the two general ports of Dublin and Cork, the roll-on/roll-off port of Rosslare and the container 
port of Waterford, including the new terminal at Belview. The concentration of investment in 
a small number of strategic ports is intended to increase traffic volumes at these ports with the 
aim of reducing unit costs and improving the frequency of services. 
The projects approved were the following: 
Port 
Dublin 
Rosslare 
Cork 
Total Project Name 
New roll-on/roll-off terminal 
Port infrastructure works 
Dredging of approach channel 
Expansion of ferry terminal Projector 
stage 
stage 
stage 
project 
stage Assistance 
granted 
(ECU million) 
3.1 
5.1 
2.1 
3.3 
13.6 
The aid rates for the projects vary from 85 % for the general harbour improvement works at 
Rosslare and Cork down to approximately two-thirds of the cost for thé Dublin Ro-Ro and Cork 
ferry terminals to take account of the additional revenue which will be generated by the projects 
when completed. 
Airports 
A single airport project was submitted by the Irish authorities and was approved by the 
Commission. The project concerns the expansion of the existing air freight terminal at Dublin 
airport and associated works, including an expansion of the apron space to cater for more and 
larger freight aircraft. This project is intended to meet a growing requirement in Ireland for air 
freight capacity, particularly for high value/low volume products. 
The Cohesion Fund contribution to the project is ECU 3.3 million, which is equivalent to half 
of the total cost. The aid rate was less than the maximum possible since account was taken of 
the increased revenue to the airport authority which will be generated by the expanded terminal. 
V3 
2.4. Assistance for studies and technical support measures - Technical assistance 
2.4.1. General 
Article 9(8) of Regulation (EEC) No 792/93 establishing a cohesion financial instrument states 
that in order to ensure the effectiveness of Community assistance, the Commission shall carry 
out a systematic assessment of projects, the way in which it is carried out and the potential and 
actual impact of its implementation. The detailed rules for monitoring and assessment are laid 
down in the decisions approving projects. 
To this end, the Commission has concluded specific contracts to secure assistance from experts 
whose skills are not available among its own staff. Details of these contracts are given in 
Annex XII. 
2.4.2. On the Commission's initiative 
The Cohesion Fund has invited consultants wishing to take part in its multiannual programme 
of studies and technical assistance to indicate their interest. It published a call for expressions 
of interest in the Official Journal of the European Communities No C 183/93 of 6 July 1993 
(see annex XIII). 
Since the projects submitted by the Member States concern the environment and transport 
infrastructure, the programme covered these two general sectors, divided respectively into 13 
and 9 sub-sectors. 
The call for expressions of interest is valid for three years from the date of its publication. 
A very large number of applications, about 1 400, has been received. The information supplied 
has permitted construction of a data base of consultants so that selection may be made by 
subject, depending on the nature of the projects submitted. Analysis and management of the 
data contained in these files was completed by early in 1994 and the base continues to be 
regularly updated. 
In the light of the needs of the Cohesion Fund,, restricted invitations to tender have been 
published to provide assistance for projects being financed. The topics include: 
rail and combined transport 
the environment 
water supply and dams 
geology. 
The consultants were chosen on the basis of the applications received, with emphasis placed 
on appropriate experience and professional qualifications. Framework contracts defining the 
tasks those providing services are to undertake were signed. These tasks include analysis, 
studies, monitoring and technical assistance. 
£*• <o 
In addition to the usual financial controls, because of the amounts involved the first two 
invitations to tender were submitted to the Consultative Committee on Purchases and Contracts, 
which issued favourable opinions in both cases. 
(b) Types of measures selected 
The technical assistance measures financed at the initiative of the Commission are intended to: 
develop capacity to undertake the technical and economic assessment of projects 
submitted by the Member States; 
permit comparisons of the cost/benefit analyses submitted by the Member States. 
The Commission has also concluded service contracts with firms which specialize in rail and 
combined transport and in the environment for work relating to assessment, the monitoring of 
projects, analysis of their coherence and the definition of the measures required to facilitate 
efficient implementation. 
si 
2.4.3. At the request of the Member States 
(a) Spain 
The Commission approved the only application for finance from the cohesion financial 
instrument submitted by the Spanish authorities. The purpose of the study was to assess the 
benefits in terms of energy and the environment which would accrue from the construction of 
bypasses around the main urban centres. The study must be capable of being applied to the 
M-40 (Madrid bypass), three sections of which are being part-financed by the cohesion financial 
instrument. 
(b) Portugal 
In the transport sector, the total funds from the cohesion financial instrument allocated to 
studies was almost ECU 1 649 million. All six studies concerned improving the operation of 
ports in Portugal. 
Two studies concerning the port of Leixôes have been approved. One is an analysis of problems 
in preparation for a general plan for the improvement and development of the port, the other 
is a study and technical projects concerning the possible improvement of a 8 ha surface and the 
construction of a further 500 m of quays for berthing. 
A study part financed by the cohesion financial instrument on the Duoro will analyse the work 
required to create a navigable channel at the mouth of the river to meet the safety requirements 
of river and sea traffic. 
The study adopted on the port of Setubal comprised an analysis of economic viability and 
environmental impact while the technical implementing projects concerned construction of the 
container terminal and multimodal interchange point. When these become operational, they 
should compensate for the lack of specialist infrastructure for container traffic by creating 
adequate supply capacity. 
The ports of Setùbal and Sesimbra have received assistance from the cohesion financial 
instrument for a study on preparation of an emergency plan for these two ports to guarantee a 
high level of safety in sea transport. 
Aid for a study providing a financial and economic assessment and technical projects to extend 
the multimode terminal at the port of Sines was also decided on during the lifetime of the 
cohesion financial instrument. 
Finance totalling ECU 2 395 000 was provided from the instrument for four studies in the field 
of the environment. 
Two of these were on a broad scale, covering the whole territory of continental Portugal. 
^ 
The study on assessment of water collection capacity and the vulnerability of the coastal area 
was intended to create a set of instruments to support the management of natural resources and 
the utilization of Portugal's coastal strip. 
The aim of the other study was to analyse and provide specific technical content for a set of 
institutional, financial, regulatory and public awareness instruments to ensure sustainable 
development of basic drainage. 
A study was also approved on the assessment of responses to the call for tenders issued for 
the construction of a new solid waste treatment plant in the Oporto area. 
The fourth study to be part-financed sought a viable solution to the problem of treating and 
disposing of solid waste in the Baixo Mondego area. 
(c) Greece 
No requests for assistance for studies or technical assistance measures were received in the 
period covered by the financial instrument. 
(d) Ireland 
No requests for assistance for studies or technical assistance measures were received in the 
period covered by the financial instrument. 
S3 
2.5. Payments made in 1993/94 for projects approved under the cohesion financial 
instrument bv Member State (up to 1 November 1994): 
(ECU) 
MS. 
ES 
GR 
IRL 
PO 
Technical 
assistance 
TOTAL PAYMENTS 
ADVANCES 
439 560 286 
204 135 405 
79 270 099 
169 899 244 
53 346 
892 918 380 INTERIM 
114 596 242 
6 280 602 
1 935 741 
58 050 323 
-
180 862 908 BALANCE 
64 795 
-
-
-
-
64 795 TOTAL 
554 221 323 
210 416 007 
81 205 840 
227 949 567 
53 346 
1 073 846 083 % 
52 
20 
7 
21 
100 
As the table of payments shows, the breakdown by type of payment shows that advances 
granted accounts for a large percentage (83%) of the total. 
This is in line with the letter and the spirit of the regulation and is in no way surprising since 
the aim is to make part of the assistance from the cohesion financial instrument available 
immediately to give the financial boost required for work on the projects to begin. That is also 
the reason for the transfer of advances amounting to 2/3 of the first yearly instalment of 
assistance for projects submitted before 1 September 1993. 
Following a discussion with the beneficiary Member States about the conditions to be met for 
interim payments, with particular reference to physical indicators of progress, consideration of 
applications for payment has resulted in a transfer amounting to 17% of the total paid. 
The only application to the Fund for payment of the balance due was accepted following a 
targeted check on documentation, on the project on the spot and on publicity hoardings. 
^I<rs 
CHAPTER 3 - CONVERGENCE AND CONDITIONALITY 
3.1. General 
The Protocol on economic and social cohesion (No 15) annexed to the Treaty on 
European Union states that the Cohesion Fund will provide assistance to Member 
States: 
with a per capita GNP of less than 90% of the Community average, and 
which have a programme leading to the fulfilment of the conditions of 
economic convergence as set out in Article 104c. 
These two conditions for Member States to be eligible for assistance from the 
Cohesion Fund were supplemented by the conclusions of the Edinburgh European 
Council.. If the Council finds that an excessive public deficit, as referred to in Article 
104 C (6) of the Treaty, exists, the Cohesion Fund may finance no new project or, in 
the case of large projects in a number of stages, no new stage of a project in that 
Member State. 
That European Council also stated that suspension of financing could not take effect 
until two years after the Treaty of Maastricht came into force, i.e. from 1 November 
1995. 
The European Council also stated that, once the Council had decided that an excessive 
deficit existed, that suspension would not take effect immediately but either: 
after one year, or 
after such other period as might be specified for correction of the deficit in 
accordance with a recommendation pursuant to Article 104c(7). 
It also stated that, in exceptional cases affecting more than one Member State, the 
Council might decide to delay suspension. 
All the provisions concerning convergence and conditionality were incorporated into 
Council Regulation (EC) No 1164/94 establishing a Cohesion Fund although 
conditionality did not apply to the Cohesion financial instrument. 
se 
3.2. Convergence programmes 
GREECE 
1. In February 1993 Greece presented a convergence programme which was 
discussed by the Ecofin Council on 15 March 1993. The objective of the 
convergence programme for 1993-98 was that by 1996 the Greek economy 
would have satisfied all the criteria for convergence set out in the Treaty on 
European Union. Underlying this expectation were a sustained policy of fiscal 
consolidation, measures to further structural reforms, a restrictive monetary 
policy, defined in terms of the drachma's participation in the ERM, and the 
freeing of international capital transactions and the liberalization of the 
domestic financial and capital markets. 
2. Owing to a significant overrun in the fiscal targets for 1993, the result of a 
much worse-than-expected economic environment, the programme became 
outdated. In accordance with the Council agreements of July 1993 and 
February 1994 and as evidence of the importance attached by Greece to 
convergence, in June 1994 the Greek Government presented a revised 
convergence programme for 1994-99 which was discussed at the Ecofin 
Council of 19 September. The objective of the revised programme is that by 
1998 the Greek economy will satisfy all the nominal convergence criteria set in 
the Union Treaty, ensuring the full participation of the country in the third 
stage of EMU from 1999. Inflation is targeted to decelerate, from 10.8% in 
1994 to 3.3% in 1999, the net borrowing of general government is projected to 
fall from 13.2% of GDP to 7.6% in 1996 and to 0.9% in 1999 and the debt 
ratio, after stabilization in 1996 at 115% of GDP, is to be reduced by around 
12 percentage points of GDP by 1999. Underlying these expectations are the 
correction of fiscal imbalances through the improvement of revenue 
performance and the rationalization of expenditure, a restrictive monetary and 
exchange rate policy in the framework of the capital movement liberalization 
on 16 May 1994 and an economic development policy based on the 
improvement of economic infrastructure and of the institutional framework of 
economic operators. Economic growth, in particular in the initial part of the 
programme, will result from public investment activity, mainly financed 
through the Community support framework which will create favourable 
conditions for private investment in the medium-term. 
3. Following the procedures laid down in Article 104c of the Treaty, the Council 
decided in September 1994 that an excessive deficit exists in Greece; in 
November the same year, the Council agreed on a recommendation to be 
addressed to Greece with a view to bringing to an end the situation of 
excessive deficit. 
SPAIN 
1. The original Spanish convergence programme was approved by the Spanish 
government in May 1992 and discussed by the Ecofin Council on June of that 
year. The programme covered the period 1992-96 and aimed at achieving 
progress in both nominal and real convergence with the EU countries. This was 
to be done through a balanced policy mix relying on a tough budgetary policy 
and structural reforms particularly in the services sector and in the labour 
market. The programme included ambitious targets as regards the general 
government deficit, which was to be reduced from 4.4% of GDP in 1991 to 1% 
in 1996 while inflation was forecast to decline from 6.3% in 1991 to 3% in 
1996. 
However, implementation of the programme went off track, in particular due to 
the unexpected severe recession in 1992-93 (in this period, cumulated growth 
was negative (- 0.2%) against an expected increase of 6.4% in the programme). 
The general government deficit turned out to be 7.5% of GDP in 1993. Some 
progress was achieved as regards the implementation of structural reform, in 
particular as regards the labour market, where a wide-ranging package of 
reforms was approved by Parliament in May 1994. The first results appear quite 
encouraging as demonstrated by the high number of new contracts, mainly 
regarding part-time jobs and apprentice contracts. 
2. The Spanish authorities remained, however, committed to pursuing 
convergence. In July 1994 the Spanish government approved the revised 
convergence programme for the period 1995-97. This was done in accordance 
with the procedures agreed by the Ecofin Council in July 1993 and February 
1994, as the macro-economic scenario and the targets of the original 
programme had become outdated. The revised programme retains the same 
broad guidelines as the former one: to progress on both real and nominal 
convergence through a furthering of fiscal consolidation and structural reforms. 
The revised programme is based on the assumption of a firm economic 
recovery which will lead to growth in Spanish GDP of 3.9% per year in 1996-
97. This would be compatible with a decline in inflation and with a reduction 
of the external deficit. On structural matters, the programme envisages further 
reforms in a wide number of economic areas (e.g. in the services sector, the 
education system, housing supply). Regarding public finance, the revised 
programme aims at reducing the general government deficit from 7.5% of GDP 
in 1993 to 3% in 1997 while the government gross debt ratio is targeted to start 
declining in 1997 standing at 67.2% of GDP in that year. The programme 
provides a wide set of measures to curb the structural deficit of central 
government, which should also increase the efficiency of Spanish economy as a 
whole. Another positive aspect is the authorities' commitment in the programme 
to bringing forward additional measures in the event of a higher than expected 
deficit. 
J" Y 
3. Following the procedures laid down in Article 104c of the Treaty, the Council 
decided in September 1994 that an excessive deficit exists in Spain; in 
November the same year, the Council agreed on a recommendation to be 
addressed to the Kingdom of Spain with a view to bringing to an end the 
situation of excessive deficit. 
5 
PORTUGAL 
1. The original convergence programme was approved by the Portuguese 
government in November 1991 and was discussed by the Ecofin Council on 16 
December of that year. The programme covered the period 1992-95 and its 
main objective was the achievement of nominal convergence with the best 
performing Member States, while maintaining a positive real growth 
differential. Inflation was expected to decline to 4%-6% in 1993-95, while the 
general government deficit was to be reduced to 3% of GDP on average during 
the same period. The disinflation strategy was based on a non-accommodating 
exchange rate policy (stability of the escudo vis-à-vis ERM currencies) 
accompanied by a tight budgetary policy. The fiscal adjustment effort was also 
intended to achieve compliance by 1995 with the public finance criteria set as a 
prerequisite for participation in EMU. In 1992 the targets of the programme 
were by and large achieved : inflation continued to decelerate while the general 
government deficit declined to 3.3% of GDP. However, the unforeseen 
recession, together with the surfacing of some structural problems in public 
finances, led to a substantial increase in the general government deficit in 1993 
to 7.1% of GDP. This did not, however, deter the Portuguese authorities from 
continuing their efforts towards convergence. Thus, following the invitation in 
July 1993 by the Ecofin to the Member States to submit new or revised 
programmes, the Portuguese authorities approved a revised convergence 
programme on 25 November 1993. 
2. The revised convergence programme was discussed by the Ecofin Council in 
February 1994. The main lines of the revised programme are quite close to the 
original one, and it can be described as an up-date of the latter, but covering 
the period till 1997. The overall objective is reaffirmed: a reduction of the 
inflation differential relative to the best performing countries while returning to 
a positive real growth differential with the Community average. The programme 
is thus consistent with the strategy of economic and social development 
embodied in the Piano de Desenvolvimento Regional for 1994-99. Exchange 
rate stability remains a central instrument to achieve disinflation. Budgetary 
adjustment is primarily based on current expenditure restraint, helped by lower 
interest payments resulting from the projected reduction in interest rates 
associated with the decline in inflation. The tax burden is not expected to 
increase markedly, although measures are intended to increase the effectiveness 
of tax collection and widen the tax base in some areas. As a result, the general 
government deficit would be put on a clear downward trend such that it could 
reach 3% in 1997 while the public debt to GDP ratio would peak in 1994 at 
71% and decline thereafter. Structural reforms aimed at increasing the 
flexibility of the economy and reinforcing market mechanisms are another 
major component of the programme. In particular, the conclusion of the 
privatization process remains one of the priorities of the national authorities. In 
1994 progress was again registered as far as inflation is concerned. Fast 
increasing fiscal revenues improved the financial situation of the general 
government and the corresponding deficit was lowered to 6.3%. The budget for 
6o 
1995 presented in mid-October is targeted to achieve a deficit of 5.8% of GDP. 
Within the framework of the budget, the Portuguese authorities announced that, 
while keeping the final target of a deficit of 3% of GDP in 1997, the annual 
path had been adjusted. 
3. Following the procedures laid down in Article 104c of the Treaty, the Council 
decided in September 1994 that an excessive deficit exists in Portugal; in 
November the same year, the Council agreed on a recommendation to be 
addressed to the Portuguese Republic with a view to bringing to an end the 
situation of excessive deficit. 
IRELAND 
1. Ireland's first convergence programme, covering the period from 1991 to. 1993, 
was presented to the Commission on 30 October 1991 and considered by the 
Ecofin Council on 10 February 1992. In it, the Irish authorities undertook to 
continue the existing stabilization policies, based on a firm consensus with the 
social partners on wage developments and broad macroeconomic objectives, 
which had already restored price and budgetary stability in the preceding years. 
Over the three-year period, inflation remained at below 3% per year, falling to 
only 1,6 % in 1993. Similarly, general government net borrowinjg remained 
virtually unchanged in the range of 2-2%% of GDP, less than half the 
Community average. This nominal stability facilitated a continued strong 
growth performance with annual average GDP growth over the period of 3'/4%. 
Given that price and budgetary stability had already been established, the main 
focus of the programmé was concentrated on the reduction of the public debt 
and improved real convergence. In this respect the results were mixed. While 
the target of a reduction in the debt ratio to below 100% of GNP by 1993 was 
already broadly met by 1992, there was subsequently a substantial rise in 1993. 
However, this was due to the valuation effects on the foreign debt from the 
devaluation of the Irish pound in January 1993 rather than a slippage in fiscal 
policy. Hence, the fundamental conditions necessary to ensure a continued fall 
in the debt ratio remain intact. Similarly, while there was a significant rise in 
per capita GDP over the period of the programme, there was a parallel very 
sharp rise in unemployment of almost four percentage points to 18.4% of the 
civilian labour force. This deterioration occurred notwithstanding continued 
employment growth, which was more than offset by a sharp rise in the labour 
force. 
2. On the expiry of the previous programme, the Irish government submitted a 
new convergence programme for the period 1994-96. It aims at annual average 
growth of 4% of GDP between 1994 and 1996, consistent with inflation of not 
more than 2V£% and a budget deficit of less than 3% of GDP each year. 
However, the major objective of the programme is an improvement in 
employment performance, which is projected to grow by 44 000 over the period 
1994 to 1996, or just over half the corresponding figure for expected labour 
force growth of about l3/4%. However, if emigration resumes in response to the 
international recovery, unemployment should actually fall. 
It is envisaged that the programme targets will be achieved through a 
continuation of the stability-oriented policies of recent years. These policies 
have widespread support, reflected in a further agreement with the social 
partners which reaffirms the commitment to continued price and budgetary 
stability. This will be facilitated by wage increases of only 8.2% over three 
years - in line with inflation but substantially below expected productivity 
growth. The programme also places a major emphasis on structural measures. 
In particular, the authorities are committed to on-going reform of the taxation 
GL 
system, where current distortions are widely viewed as a serious impediment to 
increased employment. Additional measures to increase competition and 
eliminate anti-competitive practices are also proposed. 
The principal objective of these measures is the strengthening of the growth 
potential of the indigenous sector of the economy, where the potential for 
employment growth is best. As a complement to the proposed structural 
measures, the competitive disadvantages arising from Ireland's relative under­
development will be tackled through a major investment programme. This will 
be assisted through the Community Structural Funds and the Cohesion Fund 
and a projected substantial increase in public and private investment. This 
investment will improve growth potential through a major up-grading of 
physical infrastructure, the development of indigenous industry, natural 
resources, tourism and the improvement of training and employment skills. 
63J6i/ 
CHAPTER 4 -ASSESSMENT OF PROJECTS AND MEASURES ADOPTED 
UNDER THE COHESION FINANCIAL INSTRUMENT 
4.1.General 
The department responsible for the Cohesion Fund and the Directorates-General for 
Transport, the Environment and Regional Policies undertake coordination and 
dialogue through: 
interdepartmental meetings to discuss the most appropriate strategy for 
assistance to each country and the projects likely to be adopted; 
mandatory consultation with those Directorates-General during the consideration 
of applications. Departments have not disagreed on any of the decisions under 
the cohesion financial instrument; 
where appropriate, joint meetings with the authorities of the Member States. 
There is no danger of the same expenditure being part-financed,by the cohesion 
financial instrument and the Structural Funds. The procedures in force are designed 
to avoid this risk and permit easy checks on whether an investment project has 
already been submitted to another financial instrument. 
In this connection, it should be noted that: 
the provisions on combination (Article 7(1)) are not intended to prevent the 
Structural Funds and the Cohesion Fund from financing different stages of the 
same project; 
Article 7(2) of the Regulation permits assistance from the cohesion financial 
instrument to be combined with that from the financial instruments set up under 
the transport and environment policies provided that Community grants do not 
exceed 90% of total expenditure. 
4.1.1. Project assessment 
The Commission has always appraised files to assesses whether the medium-term 
socio-economic benefits are in keeping with the resources deployed. 
This appraisal is based on: 
(a) analyses of costs and advantages submitted by the Member States, normally in 
the form of cost/benefit analyses in the cases of transport infrastructure projects 
and the larger environmental projects. In other cases they may include more 
qualitative elements; 
(b) assessment factors supplied by the European Investment Bank, either following 
its own consideration of the same project or the system or segment of which it 
forms part or in response to a request by the Commission for its opinion; 
(c) other factors for assessment available to the Commission. 
Assessment is therefore the result of a process which involves several parties and 
integrates information from a number of sources. 
However, the Commission believes that the Member States could make a still greater 
effort to improve techniques of economic analysis, particularly with regard to the 
environment. Both the Commission and the Member States have taken steps to this 
end. 
During negotiations on the Cohesion Fund regulation, the Council and the 
Commission recognized this situation and agreed that, in the case of environmental 
projects and depending on the nature of the projects submitted, other methods of 
assessment, normally quantified methods such as multi-criteria analyses, should be 
submitted in cases where cost/benefit analyses did not yield conclusive results so that 
an view could be reached on the extent to which the project was likely to achieve the 
objectives sought. 
As stated above, in assessing the projects the Commission takes account of the 
information provided by the Member States. This helps it to assess the viability of 
the projects but does not necessarily imply endorsement of their content by the 
Commission. 
4.1.2. Revenue-generating projects 
In the Commission's view, the term "revenue-generating projects" includes: 
infrastructure whose use will entail direct user charges and yield substantial net 
revenue for the promoters; 
productive investment. 
If support is granted to a revenue-generating project, the Commission, in consultation 
with the Member State, deducts the revenue from the eligible costs of the project 
where such revenue arises directly from the investment financed and where it 
constitutes a substantial net flow to the promoter. 
The practice followed in the management of the cohesion financial instrument is 
consistent with these principles. Hence, revenue which is not substantial or does not 
arise directly from the investment is ignored. 
60, 
4.2. Contribution to the reinforcement of trans-European transport networks. 
The trans-European networks have been accorded a central place in the Treaty (Title 
XII) and in the Commission's White Paper on Growth, Competitiveness and 
Employment as a means of improving the working of the single market, reinforcing 
economic and social cohesion and contributing to economic growth. Recent European 
Councils have placed considerable emphasis on the importance of the networks and 
have given further political impetus to their completion. 
Against this background, the cohesion financial instrument has played an important 
role in furthering the development of the networks by contributing to key transport 
projects in the four Cohesion countries. Under the cohesion instrument regulation 
(Regulation (EC) No 792/93) eligible projects include transport infrastructure projects 
of common interest which promote the inter-connection and inter-operability of 
national networks and access to such networks and "in particular the projects which 
are provided for in trans-European network schemes which have been adopted by the 
Council or proposed by the Commission in accordance with Title IV of Part Two of 
the Treaty". 
In practice, because of the demands made on the resources of the cohesion 
instrument, priority has been given to the financing of projects within the networks as 
defined in the approved or proposed guidelines or giving access to these networks. 
Only in exceptional circumstances have projects been approved which fall outside 
these guidelines: examples include projects relating to transport modes not at the time 
included in Commission proposals (such as vessel traffic system and air traffic 
systems). 
It has to be recalled that network guidelines had been approved by the Council only 
for the high-speed trains (HST) before the cohesion instrument came into operation; 
guidelines for roads, internal waterways and combined transport were adopted by the 
Council in October 1993, while in March 1994 the Commission submitted a proposal 
for a Council and Parliament decision covering all transport modes (COM(94) 106). 
Over the period April 1993 to May 1994, a total of 94 transport infrastructure 
projects were approved under the cohesion financial instrument involving total 
assistance of ECU 1 118.17 million. These all relate to the trans-European transport 
networks, or give access to such networks. A breakdown of the figures by country 
and by type is given in the following tables : 
Transport network projects approved for assistance 
( 1 April 1993 - 25 May 1994) 
Table 1 : by Member State 
Member State 
Spain 
Portugal 
Greece 
Ireland 
TOTAL No of projects 
• 31 
22 
18 
23 
94 Cohesion instrument 
contribution 
(ECU million) 
611.93 
280.30 
117.54 
108.40 
1 118.17 % of total 
54.7 
25.1 
10.5 
9.7 
100.0 
Table 2: by type 
Mode 
Roads 
Rail HST 
Conventional Rail 
Airports 
Maritime 
VTS 
Other 
TOTAL No of projects 
46 
2 
16 
9 
10 
5 
94 Cohesion instrument 
contribution 
808.19 
11.22 
158.6 
91.75 
32.80 
15.60 
1 118.17 % of total 
72.2 
1.0 
14.2 
8.2 
2.9 
1.4 
100.0 
In each of the four cohesion countries, the Commission has worked closely with the 
authorities concerned in order to identify priorities for financing under the cohesion 
instrument. In accordance with the objectives of the Treaty and the White Paper, and 
bearing in mind the need to maximize the use of limited resources, the strategy 
adopted has been to concentrate assistance along the main road, rail or maritime 
corridors linking these countries with the rest of Europe. In Greece, for example, this 
has meant financing projects primarily on the Patras-Athens-Thessaloniki-Bulgarian 
border corridor and on the Via Egnatia (Igoumenitsa-Thessaloniki-Kavala-Turkish 
border); in Portugal assistance has been provided for various links to Spain, and 
thence the rest of Europe, in the north of the country (Oporto-Braga-Valença), in the 
centre (Lisbon-Castelo Branco-Vilar Formoso-Valladolid), and in the south (Lisbon-
Évora-Badajoz-Madrid). In Ireland the majority of the road projects financed lie on 
the main east dorsal linking Cork, Dublin and the border with Northern Ireland with 
connections to Belfast and Larne. In Spain cohesion instrument assistance has 
financed three sections of the Madrid ring road (M-40), thus helping to alleviate a 
serious congestion point within the Spanish network, as well as several sections of 
the country's most important road corridors such as the Mediterranean corridor, the 
north-south corridor and the Galician corridor. 
Important investments in the conventional railways sector receiving cohesion 
instrument assistance include the modernization of the northern and Beira Alta lines 
in Portugal and the upgrading of the Cork-Dublin and Dublin-Belfast lines in Ireland 
and the Madrid-Valencia and Valencia-Tarragona lines in Spain. 
In the case of ports, a number of projects have been financed in Ireland and Portugal 
relating to the extension and improvement of facilities or to studying the feasibility 
of further development. Reference should also be made to an important investment in 
Spain relating to the construction of stations to operate a vessel traffic management 
system which will provide surveillance of maritime traffic in Spanish coastal waters, 
thus contributing to safety at sea and to controlling the risk of pollution 
In the case of airports, assistance has been approved for expansion projects located 
on certain islands because of their dependence on air links. 
4.3. Contribution to the implementation of environment policy 
In the field of the environment, assistance from the cohesion financial instrument is 
intended to ensure the implementation of projects which: 
(i) contribute to achievement of the objectives of Article 13Or of the Treaty, viz: 
preserving and improving the quality of the environment; 
protecting human health; 
prudent and rational utilization of natural resources. 
Projects eligible for finance are principally those which come under the 
priorities for environmental policy as set out in the Fifth Programme in relation 
to the Environment and Sustainable Development; 
(ii) arise frpm the implementation of measures adopted pursuant to Article 13 Or of 
the Treaty. These are projects to implement Community directives, principally: 
Directive 80/768/EEC relating to the quality of water intended for human 
consumption; 
the directives concerning urban waste-water treatment, and in particular 
Directive 91/271/EEC; 
Directive 75/442/EEC on waste. 
Projects are also selected on the basis of: 
their preventative action; 
their concentration on stopping problems at their origin; 
the principle that the polluter should pay. 
In order to take account of the general objective of economic and social cohesion, 
stress should be laid on environmental projects which have the greatest economic and 
social impact, and hence on those which yield the greatest economic and social 
benefits in relation to the cost of the investment. The Member States have therefore 
been asked to develop methodologies for the analysis and quantification of the socio­
economic impact of investments in the environment. The development of these 
methodologies has not yet reached the stage which might have been wished. 
In practice, the projects adopted cover the supply of drinking water and the treatment 
of waste waster and sewage and, to a lesser extent, nature conservation, combating 
erosion and preservation of the cultural heritage. 
9o 
The breakdown of projects approved by category is as follows: 
COHESION FINANCIAL INSTRUMENT 
ENVIRONMENT Assistance allocated % of total 
(ECU million) . 
Water supply 352.72 46.2 
Water quality 80.26 10.5 
Drainage 149.81 19.6 
Waste management 18.78 2.5 
Erosion control 98.14 12.8 
Heritage preservation 7.42 1 
Industrial pollution 18.08 2.4 
Nature conservation 29.87 3.9 
Other 8.94 1.2 
Total environment 764.02 100 
4.4. APPROPRIATE BALANCE BETWEEN PROJECTS IN THE TRANSPORT 
AND ENVIRONMENT SECTORS 
In 1993, projects approved in the environment sector totalled ECU 606 016 000 
while those in the transport sector totalled ECU 958 253 000. This means that about 
40% of funds went to environment projects and 60% to transport projects. 
The Commission regards this balance as satisfactory since, under this temporary 
instrument, national authorities have only a limited number of environment projects 
at an advanced stage of preparation. 
9 -7 
In 1993 these resources were allocated to the four beneficiary Member States as 
follows: 
Member 
State 
Spain 
Portugal 
Greece 
Ireland Total 
858 450 703 
(54.8%) 
283 568 700 
(18.2%) 
280 364 000 
(17.9%) 
141 887 100 
(9.1%) Environment 
252 083 242 
(29%) 
122 794 100 
(43%) 
175 222 400 
(62%) 
55 917 250 
(39%) Transport 
606 367 461 
(71%) 
160 772 600 
(57%) 
105 141 600 
(38%) 
85 969 850 
(61%) 
4.5. ASSESSMENT OF COMPATIBILITY WITH OTHER POLICIES 
4.5.1. Protection of the environment 
Article 6 of Council Regulation (EEC) No 792/93 of 30 March 1993 establishing a 
cohesion financial instrument requires projects to be in conformity with Community 
policies, including those concerning environmental protection. 
The objectives of the Community's environment policy are set out in Article 13Or 
EC. They comprise three main elements: (a) preserving and improving the quality of 
the environment, (b) protecting human health and (c) rational utilization of natural 
resources. The Community's programme of policy and action in relation to the 
environment and sustainable development as set out in the Council Resolution of 1 
February 19931 refines the policy objectives of Article 130r by focusing on changing 
current patterns of consumption and behaviour with a view to achieving more 
sustainable management of natural resources, prevention of waste, etc. The question 
of compatibility with environmental policy therefore involves more than simply 
checking legislation. 
One important aspect of achieving the environmental objectives is the requirement 
that environmental protection must be integrated into the definition and 
implementation of other Community policies, including transport policy. This aspect 
widens the scope of compatibility to raise the question of whether the transport 
infrastructure projects are aiming at a more environmentally friendly transport system. 
In practice, before a decision on a Cohesion Fund project can be taken, the 
application has to state (i) to which environmental objectives the project relates, (ii) 
how the project is linked to the implementation of Community environmental 
legislation and (iii) whether the project is consistent with a plan and programme 
associated with the implementation of Community policy or legislation. Furthermore, 
in the specific case of transport projects, an environmental impact assessment is also 
required. This information is used to check compliance with Community 
environmental policy and if necessary conditions are attached tot he decision. Most 
of the cases where this has been done concern compliance with the directives on 
urban waste water treatment (91/271/EEC), environmental impact assessments 
(85/337/EEC) or water quality. 
Compatibility does not cease to be an issue after the decision has been taken. 
Monitoring Committees are required to ensure compliance with environmental policy. 
If the conditions of the decision or environment policy are not respected, assistance 
can be reduced or even cancelled. 
OJNo C 138, 17.5.1993, p.l. 
4.5.2. Common transport policy 
The new perspectives for the common transport policy are included in the 
Commission communication "The future development of the common transport 
policy" (COM(92) 494). The key factors on which it is based include the new policy 
on trans-European networks as established by Title XII of the Treaty and the need to 
incorporate the environmental dimension into the approach to transport. 
The common transport policy also takes account of the increasing operational 
demands on the transport sector in a Community without borders. This pressure 
stems both from the fact that a large part of the existing transport networks, mainly 
in the centre of the Community, suffer from heavy congestion and from the lack of 
infrastructure in the periphery and its connections with the central regions of the 
Community. 
The development of trans-European transport networks provides a number of answers 
to these questions and has close links with the common transport policy. The 
Community is expected to contribute to the trans-European networks by establishing 
guidelines which are intended to give a real boost to the two fundamental goals: the 
single market and economic and social cohesion. The networks must pay particular 
attention to linking isolated, island and peripheral regions of the Community to the 
central regions. The guidelines must contain objectives, priorities and broad lines of 
measures and identify projects of common interest. 
This is reflected in the Commission Proposal for a European Parliament and Council 
Decision on Community guidelines for the development of the trans-European 
transport network (COM (94) 106), which sees a multimodal approach as one of the 
answers which the Community can offer to environmental constraints on the transport 
system. The different modes of transport and their corresponding projects are 
therefore included in the guidelines as a starting point for complementarity and 
gradual integration. The multimodal aspects of the projects as so identified constitute 
one important criterion for defining priorities. 
The guidelines identify the different elements of the trans-European transport 
networks 
(a) The trans-European road network (TEN), with its major long-distance 
thoroughfares and cross-connections, forms the basis for surface transport. It is 
to cover a total of 58 000 km, of which 15 000 km are to be constructed within 
the next ten years, in order to complete the road network. Some 40% of the 
work is to be carried out in the peripheral regions. 
(b) The trans-European mU network (TERN) when completed will comprise 70 000 
km, including 23 000 km largely devoted to combined transport. 
While the main aim in the central regions of the Community is to 
overcome bottlenecks by increasing capacity (e.g. modernization of 
signals, construction of by-pass lines), the emphasis in the peripheral 
regions will be above all on improving overall standards (e.g. replacing 
equipment, electrification, construction of new access lines). 
(c) Sea ports have a crucial function as the point of intersection between land and 
maritime transport, which accounts for 90% of traffic between the Community 
and the rest of the world and some 35% of the traffic between the Member 
States. Ports have a crucial function in all peripheral states. 
(d) Directly related to maritime transport is the establishment of a European 
management system for monitoring, organizing and directing maritime transport 
in European waters (Vessel Traffic Management and Information Systems -
VTMIS). The VTMIS is designed to increase the safety and efficiency of 
maritime transport and protect the environment in ecologically sensitive areas. 
The southern periphery countries such as Greece, Spain and Portugal are 
directly involved in the planned development. 
(e) The trans-European airports network comprises some 250 airports, chosen on 
the basis of quantitative criteria and of their function as links between the 
Union and the rest of the world, within the Union itself, and with its remoter 
regions. To enable the network to fulfil these functions, the proposed guidelines 
earmark the following areas as priorities: 
optimization and extension of airport capacity; 
improving environmental sustainability; 
improving access to airports and links with other networks. 
Airports are particularly import for access purposes, especially in the 
peripheral regions. 
(f) Air traffic congestion is caused not least by poor utilization of airspace and 
capacity bottlenecks in air traffic management (ATM). The gradual 
establishment of an air traffic management network comprising a flight 
navigation plan, traffic management and air traffic control facilities should 
make air transport safer and more efficient in the future. 
The lack of this type of infrastructure constitutes a missing link in some 
peripheral areas. 
The Treaty provides for these projects the possibility of Community assistance in the 
form of contributions to the funding of projects financed by Member States. These 
contributions are provided principally through the Cohesion Fund which, in the four 
countries concerned, assists transport projects identified in the networks as being of 
common interest. 
The Cohesion Fund is therefore contributing in a very significant way to transport 
projects in all modes, helping to reduce the infrastructure gap that has been identified 
Î3 
as one factor effectively hindering the free movement of persons and goods to and 
from the periphery. Through its efforts to contribute to projects in different transport 
mode, the Cohesion Fund has become a?key Community tool in developing the trans-
European networks and their aim of achieving sustainable mobility in line with 
Community environmental policy. 
4.5.3. Competition policy 
All Community measures must be compatible with the other Community policies. 
The recital to Council Regulation (EEC) No 792/93 establishing a cohesion financial 
instrument specifically states that assistance should be compatible with competition 
policy. The method of providing such assistance must be compatible with the rules 
on aid granted by the national, regional and local authorities.in the Member States. 
Compliance with the competition rules may also contribute to some extent to 
achievement of the objective of the Cohesion Fund. 
The Commission bases its assessment of State aids on Article 92 of the Treaty and, 
in the case of transport, on the specific provisions of Articles 77 and 80. These rules 
apply irrespective of whether the beneficiary firm is privately-owned, public or 
mixed. Distortions of competition arising from the granting of State aids may be 
permitted provided they do not exceed what is required to ensure public service 
obligations or the achievement of Community objectives, in particular those relating 
to economic and social cohesion and the protection of the environment and the 
objectives listed in Title XII on trans-European networks inserted by the Treaty on 
European Union. 
Checks on the compatibility of assistance from the Cohesion Fund with the 
Community competition rules are carried out at two levels. The competition aspects 
are considered when applications for assistance from the Fund are examined. 
Furthermore, the Member States are required by Article 93(3) EC to notify the 
Commission of the national counterpart financing for projects receiving assistance 
from the Fund where this could constitute a State aid. 
Similarly, the Commission's rules on State aids take considerable account of the 
cohesion objective. Hence, the bulk of the territory of Spain and the whole of the 
other three cohesion countries may benefit from high levels of aid under the 
derogation from Article 92(3 )(a) EC on aids for régional purposes. 
By imposing strict limits on State aids in the most prosperous regions of the 
Community, the Commission is seeking to ensure that the large budgets available in 
such regions do not reduce the effectiveness of Community instruments such as the 
Cohesion Fund, which are intended to help the least-favoured regions, most of which 
are located in the cohesion countries, to catch up. 
In the case of transport, the action taken by the Commission to enforce the 
competition rules is also intended to open up infrastructure to all operators who meet 
the technical and legal conditions required to offer public transport services. This 
should promote the economic viability of infrastructure projects, a factor of which the 
Fund takes account in selecting projects. 
4.5.4. Public procurement 
1. Compliance with Community law on public procurement in the context of 
projects receiving Community finance is of the utmost importance for the 
opening up of the internal market and the correct implementation of the policy 
on economic and social cohesion since it is of benefit to all the Member States. 
It benefits the Member State receiving the finance, since correct 
application of the rules on the award of public contracts will achieve the 
best value for money. 
It benefits the other Member States, both because it makes the best 
possible use of Community finance and because compliance with these 
rules protects the rights of economic operators in the various Member 
States which are contributing to this finance to take part in the 
implementation of the projects. 
2. The Commission therefore attaches the greatest possible importance to the 
compatibility of the measures financed with Community policy on public 
procurement and therefore undertakes a systematic consideration of compliance 
with the rules on public contracts during the various phases of approval and 
implementation of projects financed by the Cohesion Fund. The main purpose 
of these checks is to help beneficiaries to respect the rules by advising them of 
appropriate procedures or irregularities which can still be corrected. If the 
responsible Commission departments detect a clear and blatant infringement in 
the award of a contract, they refuse their approval of the finance for that 
contract so that the Member State may either revise the file or use the finance 
for another contract. 
3. Accordingly, between April 1993 and October 1994, 590 applications for 
finance relating to individual projects or groups of projects were considered 
from the point of view of their compliance with the rules on public 
procurement. Of these, 385 related to the environment and 205 to transport. It 
should be noted that a project may result in the award of a number of contracts 
over a period of time, so that a series of checks may be required until the 
balance is paid. This check concentrates on compliance with requirements for 
publicizing contracts, the compliance with the directives of the requirements set 
out in the invitations to tender and on the records concerning the award of 
contracts (where this is required by the directives). 
The checks result in one of the following positions: 
approval without reservation, where it has been found that the file 
complies with all the rules on public procurement; 
approval in principle, subject to ex post checks wherever the contracts are 
awarded after finance has been granted; 
=?? 
suspension of the decision to grant finance pending clarification of 
doubtful points by the national authorities; 
refusal of finance because of failure to comply with the rules on public 
procurement. 
In addition to looking at individual cases, the checks have revealed general 
trends arising from the inadequate adaptation of national legislation to 
Community law. Concerted action by the Commission departments responsible 
for public procurement and management of the Cohesion Fund has resulted in 
substantial changes, some of which are still being introduced, in the national 
legislation of two of the cohesion countries. 
4.6. Socio-economic impact of the cohesion instrument 
It is clearly too early to give a definitive statement at this point on the economic and 
social impact of projects financed by the cohesion financial instrument. This is not 
only because of the short period over which the instrument has been in operation but 
also because the nature of the investments themselves means that their full effects 
will not be evident until a considerable period of time has elapsed. Infrastructure 
projects, especially those in the transport sector, take a long time to design, develop 
and implement. Even in the environment sector, where projects are generally on a 
smaller scale, the development and construction period often spans a longer time than 
the 18 months or so since the cohesion instrument came into force. 
The majority of projects financed so far have thus not yet been completed, so that 
their operational impact has still to be felt. Moreover, much of the assistance in the 
first year of the instrument related to first stages of projects rather than to complete 
projects. It is unrealistic to expect significant socio-economic impacts from the 
financing of, say, a 5 km section of a much larger road corridor. 
Nevertheless, the need to demonstrate positive socio-economic impacts from projects 
financed under the cohesion instrument has been seriously considered by the 
Commission. With respect to anticipated impacts, it is possible to say on the basis of 
the economic analyses undertaken by the Member States that the projects financed 
should produce significant positive socio-economic returns and thereby contribute to 
national and Community employment, competitiveness and growth. Quantified 
cost/benefit analyses have been undertaken in the vast majority of cases considered 
under the cohesion instrument, the main exceptions being in the environmental fields 
where methods of economic assessment are not well advanced. 
Despite the efforts made, the Commission recognizes the importance of improving 
methods for the prior appraisal, ongoing and ex post assessment of the impact of 
projects to which the Cohesion Fund has contributed. With this in view, work is 
currently under way with the help of outside specialist advisers to improve 
approaches used and to provide guidelines for Member States when submitting 
projects for assistance. 
It should be noted that the London School of Economics and Political Science has 
undertaken a feasibility study for the Cohesion Fund looking into the possibility of 
developing an econometric model to be used to assess the economic impact of 
assisted projects. There are considerable methodological and data problems involved 
in this field but, given the importance of the Cohesion Fund and the requirements of 
the Regulation, it has been decided to follow-up the LSE work by launching a full-
scale study. A notice to this effect was published in the Official Journal of 5 
November 1994. 
4.7. Coordination and consistency with the other instruments 
The need to coordinate the various Community instruments operating in the fields of 
the environment and the trans-European transport networks was clearly stated by the 
Council when it introduced the cohesion financial instrument. 
A number of provisions and procedures have been introduced to ensure correct 
compliance with this obligation. 
4.7.1. Structural Funds 
The Structural Funds, particularly the ERDF and to a lesser extent the EAGGF 
Guidance Section, may be asked to finance projects of the same type as those 
submitted to the cohesion financial instrument. 
Steps have therefore to be taken to avoid the risk of double financing. 
The need for coordination in this respect is covered by the Council regulation 
establishing the cohesion financial instrument, Article 7 (Combination and 
overlapping) of which states that no item of expenditure may benefit both from the 
financial instrument and from aid from the Structural Funds. This provision does not 
prohibit a combination of different instruments making separate contributions to a 
project but ensures that expenditure relating to a single stage of a project does not 
receive financial support from more than one instrument, which would make the 
monitoring and control of Community expenditure impossible. 
A number of measures have been taken with regard to the procedures to implement 
coordination. 
First of all, it is the Commission's job to ensure overall coordination during 
preparation of the Community support frameworks (CSFs) for the Objective 1 regions 
since the whole territory of three of the four countries eligible under the Cohesion 
Fund is also eligible under Objective 1. Spain is in a different position because only 
part of the country is eligible under the Structural Funds. The CSFs approved by the 
Commission for these four countries make explicit reference to assistance from the 
Cohesion Fund, which is included for information in the overall financing plan of the 
CSFs. Preparation of the texts of the CSFs entails coordination of the work of the 
various Commission departments concerned, particularly the Cohesion Fund, in order 
to identify the various strategies for assistance to followed in each of the countries in 
question.. 
Coordination at the level of the measures requires still greater attention in that the 
Structural Funds operate primarily through operational programmes while the 
cohesion financial instrument and the Cohesion Fund finance only individual projects, 
stages of projects or groups of projects. New coordination procedures were 
introduced when the cohesion financial instrument came into force in order to ensure 
that projects or stages of projects submitted to that instrument had not already been 
included in the forms of assistance approved by the Commission in the CSFs for 
1989-93. 
This required mandatory consultation of the departments managing the Structural 
Funds before the Commission took any decision to grant assistance from the cohesion 
financial instrument or the Cohesion Fund. These procedures have worked well since 
there has been no disagreement between the departments managing the Structural 
Funds and that managing the Cohesion Fund. On the contrary, those departments 
have introduced checks to ensure that no item of expenditure can be financed 
simultaneously by the two Funds. 
Thirdly, in order to implement the legislation referred to above on combination and 
overlapping, the Commission has clarified the concept in the regulation. 
These procedures have ensured that no case of double financing has arisen. It has 
happened that Member States have submitted different stages of the same project to 
two different instruments. This is quite in accordance with the rules, which state that 
total Community assistance may not exceed 90% of total expenditure. This reflects 
the Council's decision to concentrate Community assistance on certain projects of 
particular concern to the Union. 
4.7.2. D.G. VII Budget line 
The annual budget line managed by DG VII commits assistance in the form of grants 
to transport projects submitted by the Member States. Since these projects may be of 
a similar type to those assisted by the cohesion financial instrument, there is a 
requirement imposed by Article 6(2) of the cohesion instrument regulation to ensure 
coordination and coherence between projects "undertaken in pursuance of the 
regulation ... and the other financial instruments of the Community". Apart from the 
general desirability of coordination of Community assistance to projects within the 
transport sector, there are also conditions governing the financing of projects by 
different instruments. Unlike the case of the Structural Funds (see preceding section), 
it is possible to assist a project or a stage of a project simultaneously by means of a 
grant from the cohesion financial instrument and a grant from DG VII's budget line 
provided a specific condition is met. Article 7(2) of the cohesion instrument 
regulation allows for "combined support from the financial instrument and other 
Community grants" provided these do not exceed 90 % of total expenditure. 
The Cohesion Fund and DG VII have maintained close contact since the 
establishment of the cohesion financial instrument, both to maintain a coherent policy 
approach to transport infrastructure projects and to ensure that the requirements of 
the regulation are adhered to. 
To this end, in addition to regular discussions, the Cohesion Fund circulates all 
applications for assistance to transport projects to DG VII for comment, including the 
detailed financial information included in the project documents. DG VII (and other 
Commission departments concerned) are consulted both when the initial project 
proposal is received from the Member State and then when a draft Commission 
decision approving assistance to the project has been prepared. In turn, DG VII 
circulates the programme of projects proposed by the Member States for assistance 
from their budget line each year to all Commission departments concerned for 
comment. The Cohesion Fund also participates in all meetings of the Transport 
Infrastructure Committee, which is the forum for discussion and agreement with the 
Member States of the annual programme of projects to be assisted by DG VII each 
year. 
su 
4.7.3. The Life programme 
In addition to general coordination with the Commission departments responsible for 
environment policy, which have to be consulted before any decision is taken to grant 
assistance from the cohesion financial instrument or the Cohesion Fund, care has also 
to be taken that projects submitted by the Member States under Life do not receive 
double financing. 
The nature of Life projects and the rules for the management of this instrument 
(clearly identified individual projects) ensure very close coordination between the two 
instruments. 
This is achieved through systematic examination by the department responsible for 
the Cohesion Fund of projects submitted to the Life Management Committee and its 
representation on that Committee. 
So far the Commission has identified no projects submitted under both instruments 
apart from the SAICA project (Automatic water quality information system), for 
which the Spanish authorities sought and obtained assistance from Life for the part 
concerning studies and finance from the cohesion financial instrument for the 
investment-related work. 
4.7.4. The European Investment Bank 
Since the EIB sometimes makes substantial contributions in the cohesion countries, 
particularly Spain and Portugal, to finance projects in areas similar to those covered 
by the cohesion financial instrument, there was a need to establish a specific system 
to exchange information between the Commission and the Bank on applications for 
assistance submitted by the Member States. 
In the context of cooperation with the EIB, the Commission decided to send it 
regular lists of all the projects it received and, in cases where part-firtancing from the 
Bank was planned, the whole file was sent. In addition, regular meetings were held 
to identify problems which might arise in specific projects. 
In accordance with the current procedures, the EIB consults the Commission when it 
receives a loan application. 
These regular exchanges of information ensure that the ceilings on EIB loans are not 
exceeded and guarantee that part-financed projects receive the correct mixture of 
grants and loans. 
4.8. The role of the European Investment Bank in assessing projects 
4.8.1. The principle 
The conclusions of the Edinburgh European Council gave the EIB a specific role by 
stating that, at the request of the Commission, it could contribute to the assessment 
of projects submitted under the cohesion financial instrument and the Cohesion Fund. 
This basic principle was given legal form in Article 9(8) of the Council Regulation 
establishing a cohesion financial instrument, which states that "In order to ensure the 
effectiveness of Community assistance, the Commission and the beneficiary Member 
States concerned shall, in cooperation with the European Investment Bank where 
appropriate, carry out a systematic assessment of projects." The role of the EIB in the 
assessment process has been strengthened by the regulation establishing the Cohesion 
Fund. 
4.8.2. Implementation 
Provisions adopted by the Commission and the EIB 
So that the EIB could play an effective role in the assessment of projects, a 
framework agreement between the Commission and the Bank was drawn up to define 
the practical details of cooperation. This was signed on 23 September 1993. 
The main objective, in addition to the requirements regarding coordination and 
mutual information described in Part 7 of the Report, is to make available to the 
Commission the EIB's expertise in the assessment of transport infrastructure projects 
and environment projects, sectors in which the Bank has made substantial loans. The 
EIB's assistance in appraising certain projects submitted under the cohesion financial 
instrument has in no way infringed the responsibilities of each institution since the 
Commission must ensure compliance with Community policies and retains the final 
decision on whether to grant assistance. 
The Bank's expertise is required either to appraise projects where no loan from the 
Bank has been made or in cases where the project is part-financed jointly by a grant 
from the cohesion financial instrument and a Bank loan. 
To deal with the first case, a two-stage assessment procedure has been introduced 
comprising examination of the file, an initial reaction, and, if necessary and only if 
requested by the Commission, an in-depth appraisal entailing on-the-spot missions by 
the EIB acting as the Commission's expert vis-à-vis promoters. Adoption by the Bank 
of this role is one of the most innovative features of the framework agreement as 
compared with the usual degree of cooperation under the Structural Funds. 
7?G 
The results of cooperation 
This close cooperation on assessment means that the Bank's expertise on the 
economic and financial aspects of projects may be sought, particularly to assess their 
socio-economic benefits, the level of costs proposed as compared with the usual costs 
of similar projects, calculation of the revenue to be generated by the investment, the 
reliability of the project promoter and the relevance of the assessment methodologies 
proposed, by the Member States. 
Although this assessment work does not necessarily call into question the economic 
justification of a project, it permits identification of certain weak points in the file 
submitted and may, in certain cases and following discussions with the Member 
State, result in the project being redesigned. 
The expertise of the EIB is required for a large number of files in both transport, 
particularly ports, airports, railways, roads and motorways, and the environment, 
where the Bank has been called on principally to assess dams, waste-water treatment 
systems and waste treatment. 
In addition to the assessments which it has requested, the Commission has benefited 
from the Bank's experience in cases where finance was to be provided by both a loan 
and a Community grant. 
Between September 1993 and September 1994 the system for cooperation between 
the Commission and the Bank resulted in the Bank providing detailed information 
and assessments on 43 projects or groups of projects. In addition, the Commission 
made specific requests for assessments of 40 projects. In response, the Bank provided 
37 initial reactions and three in-depth appraisals. 
s^. 
4.9. Coordination with the Christophersen Group 
The Cohesion Fund has closely followed the work of the "Christophersen Group", 
which was set up following the Brussels European Council in December 1993 to 
accelerate the implementation of trans-European networks in the fields of transport 
and energy (subsequently including the environment as well). The group of personal 
representatives of Heads of State and Government has met regularly since January 
1994 in order to help the Commission lead and coordinate work in this area. On the 
basis of agreed criteria it has identified a list of priority projects which are of key 
importance to the completion of the trans-European networks, and has been 
instrumental in giving political impetus to these projects and in identifying obstacles 
in the way of their completion. 
In the transport sector the Christophersen Group has identified 11 such projects as 
having the highest priority. Of these, four are located in the cohesion countries: the 
high speed train South (Madrid-Barcelona-Perpignan and Madrid-Vitoria-Dax), the 
Patras-Athens-Thessaloniki-Bulgarian border and Via Egnatia motorways, the 
Lisbon-Valladolid road corridor and the Cork-Dublin-Belfast-Larne rail link. Some 
ECU 176 million of assistance has been approved for these projects, under the 
cohesion instrument, with additional requests at present being considered by the 
Commission. 
The Cohesion Fund has participated in the meetings of the Christophersen Group and 
has been given responsibility for organizing workshops on two of the priority 
projects. The purpose of these workshops is to bring the various parties responsible 
for the projects together, to exchange views on the existing situation regarding 
progress and to explore ideas for the acceleration of the projects, including the 
prospects for private sector finance. 
S Z/Z3 
CHAPTER 5 - MONITORING AND SUPERVISION 
5.1. Monitoring Committee: Spain 
The first meeting of the Monitoring Committee was held in Madrid on 18 May 1994. 
It was concerned with operating procedures (composition of the Committee and 
frequency of meetings). It also dealt with technical matters concerning the amendment 
of the financing plans for projects, Commission decisions approving projects and 
matters relating to interim payments. 
Reports on progress on each project at 31 December 1993 were submitted. In many 
cases, the initial plans for projects had been amended as a result of the difficulties 
which had arisen in the first year of operation of the new financial instrument. 
Overall, progress on projects was considered satisfactory, particularly in view of the 
fact that many projects had been approved late in 1993. Some delays were, however, 
noted in environmental projects. 
5.2. Monitoring Committee: Portugal 
Following a preparatory meeting on 24 March 1994, the Monitoring Committee for 
Portugal held its inaugural meeting on 28 April. 
The first meeting covered a variety of topics. 
The Committee's rules of procedure were discussed and a number of amendments 
made, principally concerning the setting up of sub-committees and the possible 
participation in them of regional and local authorities. 
Progress on projects was also considered. However, since progress reports for 1993 
were not available for all projects, particularly those concerned with the environment, 
it was agreed to postpone decisions on amendments to projects until a later meeting of 
the Committee. 
Following a report on applications being considered by the Commission, the 
Committee discussed the medium-term strategy for Portugal in relation to the strategy 
for the new Cohesion Fund. 
The second meeting of the Committee was held on 30 June and approved the rules of 
procedure and the draft minutes of the previous meeting. 
Implementation of the projects was discussed thoroughly on the basis of 
documentation already sent to the Commission so that the Committee could reach a 
position on the reprogramming of a number of projects. Delays in a number of 
environmental projects were noted. 
The Committee also considered matters relating to payments, applications being 
considered and projects to be submitted in future. 
5.3. Monitoring Committee: Greece 
The Monitoring Committee for Cohesion Fund projects was established and held its 
preparatory meeting on 28 March 1994 and its first official meeting on 13 July. 
The Committee, chaired by the Secretary-General of the Ministry of Economic Affairs, 
comprises the Secretaries-General of the other seven ministries concerned with 
Cohesion Fund assistance, Commission representatives from the Directorates-General 
concerned and representatives of the EIB and the Greek ministries. 
The Committee considered summary tables for each decision and each project and 
reports on each project. 
An ad hoc Monitoring Committee for the major project to improve water supplies to 
Athens was established and met on 13 June and 19 October. 
This Committee is chaired by the Secretary-General of the Ministry of Public Works 
and includes representatives of other ministries, of the Commission Directorates-
General concerned and of the EIB. 
Progress achieved and reported to the Monitoring Committee on 13 July was as 
follows: 
improving water supplies to Athens (Evinos major project): 60% of the 
appropriations for the project; 
all other environmental projects: 49% of the appropriations for the projects 
comprising: 
water supply and waste-water treatment: 61% of the appropriations 
allocated 
nature conservation: 61% of the appropriations allocated 
others: 5%. 
Most of these projects and first stages of projects will be completed by 31 December 
1994. 
While the overall rate of implementation of environmental projects may be considered 
satisfactory, there is reason for concern in the transport sector where implementation 
has been very slow, mainly as a result of difficulties concerning public procurement. 
The Commission has begun discussions with the Greek authorities on this point. 
5.4. Monitoring Committee: Ireland 
A preliminary meeting of the monitoring committee took place in Dublin on 2 
February 1993. 
The Commission was represented by the Cohesion Fund Directorate of the Secretariat 
General. The chairman was an Assistant Secretary from the Department of Finance 
and the following Departments of the Irish Civil Service were represented: Department 
of Environment, Department of Transport, Energy and Communications, Department 
of the Marine and the Office of Public Works. 
There had been contacts for some time before the meeting between the Commission 
and the Department of Finance to establish the rules of procedure for the Committee. 
These were formally adopted at the meeting. 
No documents were provided for the Committee but there were oral reports from each 
of the Departments about the progress of projects for which they are responsible. The 
agencies responsible for project implementation believed that progress to date had 
been satisfactory. 
The remainder of the meeting concentrated largely on information requirements, 
especially the documentation which would be routinely required for future meetings of 
the Committee, and procedural issues, in particular the procedures for the modification 
of projects previously approved. 
It was agreed that the Irish authorities would prepare financial tables and reports about 
the progress of projects, covering expenditure to the end of 1993, as soon as possible 
and that this documentation would form the basis for the first full meeting of the 
Committee, which took place on 21 June. 
The Irish Government was represented by the same Departments as on 2 February. 
The Commission was represented by the Secretariat-General, DG VII and DG XI. The 
EIB had been invited to attend all meetings of the Monitoring Committee but did not 
do so on this occasion. 
Reports were provided for the Committee but these did not contain all of the 
information which was required for monitoring purposes, particularly physical 
indicators to demonstrate the progress of projects. It was agreed that the Commission 
and the Department of Finance would meet shortly after the meeting to draw up a 
definitive set of documents to be used for all future meetings of the Committee. 
The Committee heard reports from all Departments on the progress of projects. It 
appeared that progress was generally satisfactory although it was evident that 
amendments to the financing plans of a large number of projects would be required, 
largely because projects had started later in 1993 than originally anticipated. No date 
was set for the next meeting since this would depend on approval of standardized 
monitoring tables. 
'5.5. Commission inspections of the financial management of the proiects approved 
Pursuant to Article 9(3) and (9) of Council Regulation (EEC) No 792/93, the 
Commission undertook a series of measures to check the accuracy of the declarations 
submitted by the Member States to support their applications for assistance and the 
existence of administrative and accounting documents concerning projects which had 
received financial assistance from the cohesion financial instrument. 
Because a degree of priority had been given to rapid implementation of the regulation 
through the adoption of decisions to grant assistance to projects submitted by the 
beneficiary Member States, the first missions to carry out checks could not be 
organized until early in 1994. 
The missions carried out by the Commission to monitor the management and sound 
implementation of the projects approved were as follows: 
(a) Missions undertaken by Directorate SG-H and projects inspected: 
Mission to Spain from 16 to 19 May 1994 to inspect projects: 93/11/65/010, 
93/11/65/020, 
Mission to Portugal from 18 to 20 July 1994 to inspect projects: 93/10/65/006, 
93/10/61/006, 93/10/61/014, 93/10/61/015, 93/10/61/018, 93/10/61/019, 
Mission to Ireland on 20 and 21 July 1994 to inspect projects: 93/07/65/007, 
93/07/65/008, 93/07/61/031, 93/07/61/038, 
Missions to Greece: 
from 18 to 21 April 1994 to inspect projects: 93/09/65/001, 93/09/65/009, 
from 13 to 16 June 1994 to inspect projects: 93/09/61/001, 93/09/61/002, 
93/09/61/003, 93/09/61/004, 93/09/61/005, 93/09/61/006, 93/09/61/007, 
93/07/61/008, 93/09/61/012, 93/09/61/013, 93/09/61/014. 
(b) Technical verification missions carried out with the assistance of scientific 
consultants 
Specific missions for the technical assessment of projects and/or progress of work may 
also be undertaken by consultants selected for that purpose through technical 
assistance (see para. 2.4. and Annex XII). The Commission has not yet availed itself 
of this possibility. 
D 3 
5.6. Role of the EIB 
The Council Regulation explicitly gives the EIB a role in monitoring projects under 
the cohesion financial instrument and the Cohesion Fund by providing for it to be 
represented on the Monitoring Committees established in each beneficiary Member 
State. 
The EIB has taken part in the work of these Committees. 
The Bank is also invited to send representatives to the ad hoc Monitoring Committees 
established or to be established to monitor major projects. Such representation is 
particularly important in the case of major projects to which the Bank is making a 
loan. 
In addition to this cooperation procedure laid down by the Regulation, the EIB, which 
has its own procedures for monitoring the projects which it finances, provides the 
Commission with technical support with regard to projects for which it has already 
financed part of the expenditure and for which the Member State has requested a grant 
from the cohesion financial instrument or the Cohesion Fund in addition to the loan. 
5.7. Fraud 
The Commission has received no reports of fraud or irregularity in connection with 
projects approved under Council Regulation (EEC) No 792/93. 
5.8. Legal proceedings in progress 
The Commission is not aware of any legal proceedings in progress in connection with 
projects approved under Council Regulation (EEC) No 792/93. 
See Annex XII 
List of studies and technical support measures 1993/94 (CFI) 
9 y/su-
CHAPTER 6 - INFORMATION AND PUBLICITY 
6.1. Annual report 
This annual report is the main regular source of information. It seeks to cover as 
comprehensively as possible the operation of the financial instrument and the projects 
assisted. 
As required by the Regulation, its main objective is to provide information to the 
Community institutions. 
In addition,the Commission believes that the report should be distributed widely so 
that it can be used by all the partners in the Member States, regional and local 
authorities and those socio-economic operators who are directly or indirectly involved 
in the implementation of projects on the spot. 
6.2. Information to the Member States 
Article 10(2) of Council Regulation (EEC) No 792/93 of 30 March 1993 establishing 
a cohesion financial instrument requires the Commission to submit an annual report. 
As a result of its political commitment, the Commission organizes information 
meetings with the Member States every six months. 
To this end, the Cohesion Fund has so far organized three meetings, on 22 October 
1993, and 6 May and 14 November 1994, to provide the Member States with factual 
information for this purpose. 
6.3. Information to the social partners 
So far, three meetings have been organized for the social partners( the CES , the 
ECPE and UNICE ) , to update them on the work of the Cohesion Fund, the projects 
selected and the breakdown between transport and the environment.These meetings 
were held on 11 October 1993, on 4 February and 16 September 1994. 
6.4. Information to interested parties 
The measures taken are of two types: those organized at the initiative of the Cohesion 
Fund with the assistance of Commission delegations and press and information offices 
and those organized at the initiative of other bodies. In both cases, the type of 
organization is broadly similar: a two-hour presentation and explanation using various 
audio-visual resources followed or preceded by a press conference. Documentation on 
the Cohesion Fund, the reasons for its establishment, the way it operates and the 
projects financed is provided. The meetings are listed below in chronological order. 
Lisbon, 26 October 1993 Information meeting on the Cohesion Fund organized with 
assistance from the Commission press and information office in Lisbon and the 
Ministry of Territorial Planning. Attendance: about 200 people. 
Paris, 15 December 1993 Information meeting on the Cohesion Fund organized with 
assistance from the Commission press and information office in Paris, Sources 
d'Europe and the French foreign trade centre for some 300 managers in French 
companies seeking information on the possibilities offered by the Fund. 
London, 22 April 1994 Conference presented by the Cohesion Fund in the 
Commission press and information office on the opportunities for direct and indirect 
investment created by the Fund and attended by an invited audience of some forty 
people from industry, consultancies, banks, the diplomatic corps, universities and 
ministries. 
Madrid, 17 May 1994 Information seminar on the Cohesion Fund organized by the 
Spanish confederation of employers' organizations (CEOE). The public invited 
included members of regional, provincial and sectoral organizations and of employers' 
groups and .associate members of the confederation. The seminar was particularly 
intended for those active in the banking, transport infrastructure and environment 
sectors, especially employers active in the electricity and construction sectors. Some 
80 people attended. 
Bonn, 24 June 1994 Information seminar on the Cohesion Fund organized by the 
Deutscher Industrie- und Handelstag (DIHT) in cooperation with the Commission 
press and information office in Bonn. The seminar, which was directed at German 
firms and attended by Mr Schmidhuber, stressed the opportunities for firms throughout 
the Community to respond to calls for tenders in the public procurement sector and 
participate in implementation of the Fund in the beneficiary Member States. Almost 90 
people attended. 
Copenhagen and Aarhus, 29 and 30 August 1994 Information seminar on the work of 
the Cohesion Fund organized by the Danish Foreign Ministry as part of a series of 
conferences to provide information to Danish firms. The aim of the seminar was to 
inform them of the opportunities for investment in projects part-financed by the 
Cohesion Fund. These conferences, which were attended by a total of 170 people, 
stressed the importance of the assistance being granted to the beneficiary Member 
States and the indirect impact of this assistance in the other Community countries. 
London, 13 September 1994 This information seminar for the business community in 
England was organized by the London School of Economics with assistance from the 
Department of Trade and Industry. Media coverage comprised an interview in the 
Financial Times and television coverage beforehand as well as a contribution to a 
radio broadcast on the morning of the seminar. The seminar was attended by 125 
people. 
°>> 
Brussels, 22 September 1994 An information seminar for Belgian firms on the 
Cohesion Fund organized by the Belgian foreign trade office. The Commission was 
invited to attend to explain the principles underlying the Cohesion Fund and its 
method of operation. On this occasion, the foreign trade prize was presented for 
university work by students on the new market opportunities created by the 
establishment of this new Community instrument. 
Dublin, 13 October 1994 Alongside a visit by Mr Schmidhuber, an information 
meeting was organized with assistance from the Dublin press and information office 
and attended by those concerned with projects currently being part-financed by the 
Cohesion Fund. The meeting was attended by some 40 people representing the 
Departments of the Environment and Finance and other administrative departments, 
the Bank of Ireland and farmers' organizations. 
6.5. Seminars on financial management 
As part of its information work, the Commission organized training, first in Greece 
and later in Portugal, to make those managing national and regional files aware of and 
more familiar with the implementation of the cohesion financial instrument Regulation 
both in terms of the documentation to be submitted with applications for assistance 
and payment and the financial management of the assistance granted (advances, 
interim payments, physical indicators, calculations and certifications). 
The large number of participants reflects the interest in training and demonstrates the 
need for it. The results expected were quickly seen in an improvement of the quality 
of applications submitted. 
6.6, Publicity measures taken bv the Commission 
(a) Publication of decisions 
In accordance with the Regulation, all decisions adopted are published in the Official 
Journal, Publication references are annexed to this Report. 
(b) Brochure 
A brochure for the general public explaining the origins and scope of the Cohesion 
Fund and using photographs to describe projects financed by it is being prepared in 
the nine Community languages. It is intended to publish the first language versions in 
December 1994. 
"5? 
(c) Posters 
A poster on the part-financing of transport and environment projects in the Member 
States benefiting from the Cohesion Fund which stresses the idea of solidarity among 
the countries of Europe has been printed in the nine Community languages. It is 
distributed in the beneficiary Member States by the Commission's press and 
information offices and by the ministries responsible for the Fund. In the other 
Member States, it is distributed by the offices and delegations. It is also distributed by 
DG X and the Directorate responsible for the Cohesion Fund. 
(d) Audio-visual 
A similar general presentation of the Cohesion Fund using illustrations and statistics 
on projects being part-financed is available for use on PC in six language versions. 
This presentation, which uses a portable PC and a back-projector, is used to present 
the Cohesion Fund at information seminars. 
(e) Films 
Financial Times TV has made a five-minute film on the Cohesion Fund, its work and 
its scope in the four beneficiary Member States using interviews with those 
responsible for the Fund. This film also exists in- a 20-minute version. The film, which 
will shortly be available in French, is used principally to provide documentary back-up 
at information meetings on the Fund. Considerable interest has been shown in the 
film, which enables various groups to see specific measures receiving part-finance 
from the Fund while also providing further information on Community assistance in 
general. 
A one hour video with pictures, sound and interviews with those responsible for 
management of the Cohesion Fund in the four beneficiary Member States has been 
made in cooperation with DG X for use in television and by journalists. This "image 
data bank" is used by television editors for various news and other programmes. The 
pictures are also being used for other documentaries dealing more specifically with 
each beneficiary Member State which are now being made by the Cohesion Fund and 
DGX. 
(f) Videos 
A number of video cassettes made by the Member States receiving assistance from the 
Fund to illustrate the projects it is part-financing are presented at information 
meetings. A stock of documentaries relating to the Cohesion Fund is being compiled 
so as to constitute a visual archive of its work and development. 
(g) Miscellaneous 
In addition to the points described above and in accordance with the policy of 
transparency adopted at the Edinburgh summit in 1992, the press releases announcing 
the grant of assistance from the Cohesion Fund, background articles and interviews 
with those responsible appear regularly both within the Commission and elsewhere, 
thereby contributing as far as possible to the multiplier effect being sought. Every 
possible effort is also being made to constitute a written record of this work. 
6.7. Measures taken bv the Member States 
(a) General 
The rules on publicity laid down by Article 10(1) of the Regulation establishing a 
cohesion financial instrument require the Member States to ensure adequate publicity 
with a view to making the general public aware of the role played by the Community 
in relation to projects. 
Measures are taken to publicize, in various ways, the different stages of the projects. 
When an application for finance for a project is made, the Member State specifies the 
publicity it will receive. During implementation, this is a matter for the Monitoring 
Committee in the Member State. 
(b) Forms of publicity 
The main form of publicity used is the hoarding. All the beneficiary countries have 
employed it and consulted the Fund in advance on format and presentation. 
Hoardings erected during work at entrances to sites provide information of various 
types, including a description of the project being financed, a reference to the 
Cohesion Fund as investor, the symbol of the European Communities, the total cost of 
the project and the amount of assistance granted. 
Other measures 
Portugal and Spain have already reported on detailed publicity measures taken in those 
countries including: 
by the Portuguese authorities: 
articles in a quarterly information bulletin widely distributed in the civil 
service, regional associations, universities, trade unions, firms and 
banks; 
-/ÛQ 
a general information meeting on the Cohesion Fund for potential 
investors, representatives of trade union and employers' confederations, 
engineers and representatives of local authorities and environmental 
protection associations; 
a conference for the authorities responsible for projects being part-
financed by the Fund; 
by the Spanish authorities; 
to supplement the publicity provided by some thirty hoardings, 
information seminars have been organized, mainly in universities but 
also by provincial authorities. 
Ireland and Greece will report shortly on the publicity measures taken in those 
countries. 
The requirements concerning information and publicity are essential to ensure the 
transparency of assistance form the Fund and raise the awareness of citizens of the 
Union in this regard. 
The attention to be paid to these measures has also been increased by the regulation, 
mainly at the request of Parliament during negotiations on the establishment of the 
Cohesion Fund. 
Ao<n ISSN 0254-1475 
COM(95) 001 final 
DOCUMENTS 
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