• ;ï%%ÏV&$ïfe< 
COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 23.06.1997 
COM(97) 302 final 
ANNUAL REPORT 
ON THE COHESION FUND 
1996 
(presented by the Commission) 

PREFACE 
The present annual report on the activities of the Cohesion Fund covers the calendar year 1996. 
It has. however, been necessary to include some remarks on activities in earlier years as well as 
comments on planned measures for the future in order to give the reader the full picture of the 
current affairs of the Fund. 
The reporting format is largely unchanged from previous reports and reflects the detailed 
requirements of the Annex to Annex II to the Cohesion Fund Regulation. Nevertheless, 
comments made by the European Parliament, the Economic and Social Committee and the 
Committee of the Regions on earlier reports have been duly taken into account and adjustments 
made in the presentation. In particular attention has been given to a detailed explanation of how 
the conditionality principle has been implemented and to the Commission Decision on 
information and publicity measures. The specific requests for a section on ultra-peripheral 
regions and for a developed section on evaluation have also been met. 
The report fulfils the legal requirements of the Cohesion Fund Regulation. It is hoped that it 
will also serve" as a useful reference for all who are interested in the promotion and furtherance 
of the economic and social cohesion of the Union. 
Annual report of ihe Cohesion l-'und 1°*% 
EXECUTIVE SUMMARY 
Economie and Social Cohesion is one of the main objectives of the Treaty on European Union. 
During 1906 the Cohesion Fund continued and reinforced its contribution to the achievement of 
this objective. 
lc>% was in many ways a key year for the Cohesion Fund: the teething troubles of a new 
instrument for cohesion had been dealt with and the Fund was fully operational: experience 
gained since the first operations in 109? formed the backbone of current management practices 
and the first ex post evaluations, i.e. the assessment of the effects of completed projects, could 
be undertaken. 
The importance of this last point can hardly be overstated: the weight of the Cohesion Fund as 
an instrument to favour economic and social cohesion depends on its ability to demonstrate 
the usefulness of the completed projects, be it in terms of better transport facilities, shorter 
travel distances, savings in transport time, more efficient goods handling, reduced air pollution 
and better environment in the towns and cities concerned, improved fresh water management 
ranging from catchment, supply and distribution of drinking water for human consumption to 
proper treatment of used water and sewage and environmentally friendly handling of solid 
waste, to mention but a few examples. In the coming years, more and more Cohesion Fund 
projects will be completed, thus providing the basis for an overall evaluation of the efforts of 
the Union and the Member States. 
1906 was also the mid-point year between 1993. the.year of the first project decisions, and 
1009. the last year covered by the present Fund Regulation. Appropriately, therefore, a mid­
term review of Member State eligibility with respect to the GNP criterion was carried out in 
1006. All four Member States continue to be eligible. 
Furthermore. 1006 was the first year in which the Commission undertook an examination of 
Member States" compliance with their economic convergence programmes in tjie field of 
public deficits: the conditionality principle was applied by Commission decisions in June and 
No\ ember concerning Spain. Portugal and Greece. On each occasion, all three Member States 
were considered to have a budgetary performance within the targets recommended b\ the 
Council. 
The financing strategy of the Fund was further consolidated in 1996 in line with the provision^ 
of the Cohesion fund Regulation. The balance between the two areas of assistance - transport 
infrastructure and environment - reached an almost perfect 50/50 distribution. This reflects the 
determination of the Commission, which is fully supported by the European Parliament, the 
Economic and Social Committee and the Committee of the Regions, to achieve an equal level 
of fmaneini: for the two areas of Cohesion Fund financing for the whole period. The result in 
100^ brings tins objective clearly within reach. 
In line with remarks made by the European Parliament in its opinion on the 1 0<-M Cohesion 
fund Annual .Report and reiterated concerning 1005 and by the Committee of the Regions and 
the Economic and Social Committee, the efforts to allocate a higher proportion of finance 
within the transport sector to rail transport facilities continued. 
<v ( 'ohesici; l;u 
Furthermore the projects financed in the most remote regions received special attention in 
1996: a separate section of this annual report gives more details (see point 2.3.5). 
The Fund finances transport infrastructure projects only where they are either part of the 
trans-European Transport Network (TEN - transport) or feed the network directlv. This 
represents the strategy for setting priorities for the Cohesion Fund in the field of transport 
infrastructure, a strategy which has already shown its usefulness in relation to completing 
missing parts of the TEN. 
The directives concerning the supply of drinking water, waste-water treatment and the 
treatment of sewage continue to set the priorities for assistance in the field of environment. 
Other emironment measures, which may be seen as improving environmental levels, mav also 
be eligible and may receive part-financing from the Fund. Some examples concern projects 
relating to coastal protection, reafforestation and desertification, habitat protection and nature 
conservation. 
The polluter-pays principle is applied whenever a project is part-financed by the Cohesion 
Fund. Through a procedure of double consultation of the responsible departments in the 
Commission, every project is submitted to detailed examination and verification of compliance 
with Community legislation. This procedure also aims at assuring that the best evaluation 
practices available are applied. 
The Commission stated in the 1995 report on the Cohesion Fund that there is room for 
improvement of analytical methods and their practical application. In line with this statement 
the Commission has carried out a study with external consultants on the Application of the 
Polluter-Pays-Principle in Cohesion Fund Countries to gain further insight into the practical 
and theoretical issues involved. The main results of this study are presented in Chapter 2. 
The combating of unemployment and the creation of new job opportunities is a high priority for 
the Commission. The 1995 annual report on the Cohesion Fund presented some first estimates 
of the short and long term employment effects of funded projects. The present report develops 
these estimates further and also outlines some key findings from the study carried out for the 
Commission by the London School of Economics into the overall socio-economic effects of 
projects. The section on employment is also a direct response to the requests from the European 
Parliament, the Economic and social Committee and the Committee of the Regions for more 
information on the job-creation generated by the Cohesion Fund. 
The European Investment Bank continues, under the agreement with the Commission, t^ be 
consulted for its financial and technical expertise on major projects presented by the Member 
States. This increases the quality of assessment of the proposals beyond what the Commission 
itself can provide and therefore gives added value. 
Budgetary implementation for the year was, once again, close to 100% - an impressive figure 
considering that each individual project must be fully scrutinised before commitments and 
payments can be made and that continuous monitoring and checks on physical indicators are 
made prior to any further release of funding. 
The monitoring and follow-up of projects has continued on a high level throughout the year. 
The Monitorimi Committees have held regular meetings and have included representatives 
Annual report of the Cohesion Fund 1906 
from local and regional bodies as well as national level. It is important to underline that no 
cases of fraud have been reported on Cohesion Fund projects; the responsible authorities of the 
Member States and the Union have carried out numerous inspections and checks in this respect, 
as described in Chapter 5.4. Some cases of irregularities have been detected and the necessary 
corrective measures taken. 
In June 1996 the Commission adopted, after having received the observations of the European 
Parliament, a Decision on information and publicity measures. The Decision includes details 
on the use of bill-boards, brochures, audio-visual presentations, TV and other media. Each 
project part-financed by the Cohesion Fund must be given appropriate information and 
publicity. These measures may be included in the request for Fund financing, which will make 
modern and efficient publicity attractive for fhe promoter of a project. 
Annual report of the Cohesion Fund 1006 
CONTENTS 
PREFACE 
EXECUTIVE SUMMARY 
CHAPTER l - IMPLEMENTATION OF COHESION FUND PRINCIPLES 8 
1.1 Background * 8 
1.2 CoiKditiorjality 8 
1.3 Mid-term review 10 
1.4 Information and publicity measures 10 
1.5 First Cohesion Report 12 
CHAPTER 2- FINANCIAL ASSISTANCE COMMITTED AND PAID BY THE FUND 14 
2.1 Budget available 14 
2.2 Breakdown by Member State 14 
2.3 Budget implementation 15 
2.3.1 Spain 16 
2.3.2 Portugal 34 
2.3.3 Greece 52 
2.3.4 Ireland 61 
2.3.5 Most remote regions 70 
2.4 Assistance for studies and technical support measures 75 
2.4.1 General 75 
2.4.2 At the initiative of the Commission 76 
2.4.3 At the initiative of the Member States 77 
2.5 Payments by Member State: payments in 1996 77 
2.6 Projects closed 78 
CHAPTER 3- CONVERGENCE AND CONDITIONAIJTY 94 
3.1 Background 94 
3.2 Convergence programmes 94 
3.2.1 Spain 94 
3.2.2 Portugal 95 
3.2.3 Greece 95 
3.2.4 Ireland 96 
CHAPTER 4 - ASSESSMENT OF THE PROJECTS AND MEASURES ADOPTED 98 
4.1 General 98 
4.1.1 Assessment of projects 98 
Annual report of the Cohesion Fund 1996 
4.1.2 mœme-gOTeraring projects 100 
4.2 Trans-European transport networks 101 
4.2.1 General strategy 101 
4.2.2 Reinforcement of the transport network in 1996 102 
4.2.3 Essen priority projects 105 
4.2.4 Group of Commissioners (TENs)/Kinnock high level group 107 
4.3 Trarisport/ejivironment balance 108 
4.4 Assessment of compatibility with the other policies 108 
4.4.1 Environmental protection 108 
4.4.2 Common transport policy 110 
4.4.3 Public procurement 111 
4.4.4 Competition 112 
4.5 Socio-economic impact of the Cohesion Fund 113 
4.5.1 Introduction 113 
4.5.2 Economic appraisal of projects 113 
4.5.3 Overall socio-economic impact 115 
4.5.4 Employment 119 
4.6 Co-ordination and consistency with other financial instruments 120 
4.6.1 Structural funds 121 
4.6.2 TENs transport budget line 122 
4.6.3 Life programme 123 
4.6.4 European Investment Bank 123 
4.6.5 EEA financial mechanism 124 
4.7 The role of the EE3 in evaluating projects 125 
4.7.1 On-going institutional cooperation 125 
4.7.2 The results of cooperation in 19% 125 
CHAPTER 5 - MONITORING AND CHECKS 126 
5.1 Monitoring Committees 126 
5.1.1 Spain 126 
5.1.2 Portugal 128 
5.1.3 Greece 129 
5.1.4 Ireland 131 
5.2 Inspection missions 131 
5.2.1 Spain 132 
5.2.2 Portugal 133 
5.2.3 Greece 133 
5.2.4 Ireland 134 
5.3 Role of the EIB 135 
5.4 Fraud and irregularities 135 
5.5 Legal proceedings in progress 136 
5.6 Sound and Efficient Management (S EM) 13 6 
CHAPTER 6 - INTERINSTITUTIONAL DIALOGUE, INFORMATION AND PUBLICITY 137 
6.1 Annual report to the European Parliament, the Council the Economic and 
Annual report of the Cohesion Fund 1996 
Social Committee and the Committee of the Regions 137 
6.1.1 The European Parliament 137 
6.1.2 Economic and Social Committee and the Committee 
of the Regions 138 
6.2. Information to the Member States 138 
6.3 Information to the social partners 139 
6.4 Other information events 139 
6.5 Commission publicity and information measures 140 
The maps included in this Annual Report are for illustration purposes only and do not 
legally engage the Commission. 
Annual report of the Cohesion Fund 1^96 
CHAPTER 1 - Implementation of Cohesion Fund principles 
CHAPTER 1 
IMPLEMENTATION OF COHESION FUND PRINCIPLES 
1.1 BACKGROUND 
The Cohesion Fund is subject to a number of general rules which are specific to the Fund and 
which are laid down in its Regulation. This chapter gives details *on the three main areas: 
conditionality. the mid-term review of the GNP figures of the Member States and the 
Commission decision concerning information and publicity measures. 
1.2 CONDITIONALITY 
1996 was the first year in which the principle of conditionality applied. To prepare for the 
implementation of the principle, the Commission had already decided - on 20 December 1995 
as reported in the 1995 Annual Report - on the practical application of conditionality. 
Eligible Member States must have a programme leading to the fulfilment of the conditions of 
economic convergence as set out in Article 104c of the Treaty, which relates to government 
deficits. Article 6 of the Cohesion Fund Regulation 1 requires the Commission to suspend 
financing for new projects or - in the case of projects divided into different stages - new stages 
of projects, if the Member State concerned is found to have an excessive deficit. 
The Commission has decided to examine conditionality twice a year: in spring and in autumn. 
This allows for the possibility of reacting to new economic data as soon as they are known and 
verified. The procedure is as follows: 
in spring the deficit for the previous year is examined on the basis of the notification 
from the Member States and the Commission's spring economic forecasts: 
in autumn, normally in November, the deficit for the current year is assessed based on 
the notifications from the Member States of budgetary implementation by end-
September and the Commission's autumn forecasts. 
Member State government deficits must be in line with the annual recommended targets set by 
the Council. Comparisons are made with the Council recommendations for the relevant years: 
if the target is met then financing of new projects or new stages of projects can continue or be 
resumed, as the case may be. If the target is exceeded then financing of new projects or new 
stages of projects is suspended, provided that the deficit is significantly off the mark for 
reasons other than exceptional circumstances outside the control of the Member State. Projects 
already approved are not affected. 
Regulation (EC) No 1 164/94 of 16 Mav 1994. 
Annual report of the Cohesion fund 1996 
CHAPTER 1 - Implementation of Cohesion Fund principles 
The Commission takes all the necessary steps to verify the data to ensure that the information is 
correct. A high degree of certainty is necessary, not least if the decision reverses previous 
decisions, i.e. when suspending or resuming financing. 
In 1996 the spring examination took place in May/June and concerned the deficit performance 
in 1995. 
For that year the targets recommended by the Council for the government deficits relative to 
Gross Domestic Product and the deficit performance were then estimated as follows: 
recommended target 1995 deficit performance (*) 
for 1995 
Greece 10.7% 9.2% 
Portugal 5.8% 5.4% 
Spain ^9% 5.8% 
(*) Commission spring 1996 Economic Forecasts 
In each case the Commission therefore concluded that the government deficits were inside the 
recommended target and that approval of new projects and stages of projects could continue in 
the three Member States. 
Following an internal audit of government accounts, the Spanish Government revised the 
deficit for 1995 by adding 0.8% to the previous figure of 5.8%. Consequently a revised deficit 
figure of 6.6% of GDP was reported officially to the Commission on 1 September 1996 under 
the excessive deficit regulation-. 
A deficit of 6.6% is clearly outside the recommended target of 5.9% for 1995. Mad the 
Commission been in possession of the revised figures at the spring examination, suspension 
would have been introduced in June 1996. However that suspension would have been lifted in 
autumn 1996 because the deficit performance for 1996 was forecast at 4.4%. which coincides 
with the recommended target for 1996. In these circumstances the Commission decided not to 
suspend financing from the Cohesion Fund provided that the Spanish commitment to limit the 
government deficit to 4.4% could be verified. The Spanish authorities will provide all the 
necessary data and information necessary for the monitoring of the target. 
The autumn examination in 1996 was carried out in October/November and concerned, in 
accordance with the procedure, the deficit performance forecast for 1996. 
For Greece. Portugal and Spain the targets and forecast deficits were then estimated as follows: 
recommended target forecast 1996 deficit (*) 
for 1996 
Greece 1_6% 7.9% 
Portugal 4.3% U)% 
Spain 4.4% 4.4% 
) Commission autumn 1996 Economic Forecasts 
2 Regulation ( EC) No 3605 '93. 
Annual report ol the Cohesion Fund 1996 
CHAPTER I - Implementation of Cohesion Fund principles 
On this basis the Commission concluded that the Portuguese deficit was inside the 
recommended target. A Greek deficit of 7.9% would be outside the target, but verification of 
the reliability of the data did not give sufficient reason to believe that the final outcome would 
indeed exceed the target value. In neither case, therefore, did the Commission find it necessary 
to suspend financing of new projects. However, the Commission did write a letter to the Greek 
authorities to urge them to take all necessary steps to avoid exceeding the target for 1996 and to 
inform them of the consequences of non-compliance with the recommended target. 
1.3 MID-TERM REVIEW 
The Cohesion Fund provides financial contributions to projects in Member States with a per 
capita gross national product (GNP), measured in purchasing power parities, of less than 90% 
of the Community average. 
Article 2(3) of the Cohesion Fund regulation stipulates with regard to the GNP criterion that the 
Member States "... shall continue to be eligible for assistance from the Fund provided that, after 
a mid-term review in 1996, their GNP remains below 90% of the Community average. Any 
eligible Member State whose GNP exceeds the 90% threshold at that time shall lose its 
entitlement to assistance from the Fund for new projects or, in the case of important projects 
split into several technically and financially separate stages, for new stages of a project." 
The Commission undertook the mid-term review on 12 June 1996. The most up-to-date figures 
available were those for 1995, which were as follows: 
Per capita GNP in 1995 (in PPS), EUR 15=100 
Greece 65.8 
Ireland 78.9 
Portugal 72.3 
Spain 75.7 
All four Member States therefore continue to meet the GNP eligibility criterion and therefore 
also continue to be eligible for Cohesion Fund financing. 
It should be noted that Article 2(2) of the Cohesion Fund Regulation provides that until 1999 
only these four Member States may be eligible, and that consequently no other Member State 
may be put on the list at the present time. 
1.4 INFORMATION AND PUBLICITY MEASURES 
Article 14(3) of the Cohesion Fund Regulation requires the Commission to adopt detailed rules 
on information and publicity, inform the European Parliament thereof and publish them in the 
Annual report of the Cohesion Fund 1996 
CHAPTER 1 - Implementation of Cohesion Fund principles 
Official Journal. The Decision was adopted on 25 June 1996 and published in the Official 
Journal on 27 July0. 
The thrust of the Decision is that each and every project carried out with the assistance of the 
Cohesion Fund is to be promoted by appropriate, timely and comprehensive information and 
publicity measures. The authorities responsible for implementing the projects, whether 
national, local or regional, are also responsible for publicity and information. The measures 
must be carried out in collaboration with the Commission. The Decision concerns the media, 
information material, information events and the use of all modern forms of communication, 
including audio-visual presentations and videos. 
Every project must as a minimum include on-the-spot information and publicity measures, and 
information material explaining its content and the Community contribution must be made 
available at local and regional level. To this minimum requirement are added other elements of 
publicity and information; the bigger the project, the more comprehensive and widely 
distributed the information and publicity. These extra elements comprise regular news 
conferences, bill-boards and permanent commemorative plaques, brochures of general interest, 
professional video-clips and presentations intended for national radio and TV channels. It 
should be noted that the competent authorities may include the cost of information and 
publicity in the eligible expenditure for a project; these costs may therefore be part-financed at 
the same rate as Cohesion Fund projects in general, i.e. at 80% to 85%. 
The Commission must also be active in this field and in particular organise regular news 
conferences in the Member States concerned, not least in cases where major investments 
(exceeding ECU 20 million) are concerned. 
It is important to note that the Monitoring Committees have a key role in overseeing the 
measures and making sure that relevant information is made available to the public. It should 
be recalled that should a Member State fail to respect its obligations on information and 
publicity, the Commission reserves the right to suspend, reduce or even cancel assistance from 
the Cohesion Fund for the projects. 
The European Parliament, which was consulted on the draft proposal before the Commission 
adopted its Decision, approved the general measures proposed but set out a number of 
particular concerns relating to their implementation. Parliament pointed out that the notion of 
information is wider and more comprehensive than publicity and criticised the proposal for 
focusing only on the latter. It also stressed the need to guarantee the dissemination of 
information, involving the national, regional and local authorities, and encompassing all 
structural measures supported by the Union through the Cohesion Fund and the Structural 
Funds, in particular in the fields of transport infrastructure and the environment. 
In the final Decision, the Commission responded positively to the concerns of the Parliament 
by specifying that the measures are additional to those other arrangements for information and 
publicity undertaken for regional and cohesion policies by the Member States or by the 
Commission Decision of 25 -lune 1996 concerning information and publicity measures to be carried 
out by the Member States and the Commission concerning the activities of the Cohesion Fund under 
Council Regulation (EC) No I 164 94 (96/455 EC) - OJ No L188, 27.7.1996. p 47. 
Animai report of the Cohesion Fund 1 0C)6 
CHAPTER 1 - Implementation of Cohesion Fund principles 12 
Commission. A specific reference was made in this context to the decision on publicity and 
information on the Structural Funds and the Financial Instrument for Fisheries Guidance^. 
1.5 FIRST COHESION REPORT 
Presentation of the first Report on Economic and Social Cohesion in the European Union, 
adopted by the Commission on 6 November 1996, stems from the Treaty of Maastricht, which 
introduced the requirement for a three-yearly report on progress towards achieving cohesion in 
the Union by reducing disparities between living standards and the opportunities for economic 
development in the Member States, regions and social groups. 
The main message of the report is clear: progress has been made. In scarcely ten years, the four 
poorest countries in the Union have raised per capita income from 66% to 74% of the 
Community average, largely thanks to the Union's structural policies. Nevertheless, 
unemployment remains a constant problem whose impact on certain regions and social groups 
is particularly serious. 
Over the last ten years, economic growth in the Union has averaged just over 2% per year while 
employment has increased by 0.5% per year. This means that some 7 million net jobs per year 
have been created since 1983. 
Over that period, differences in per capita incomes between the Member States have fallen 
sharply, largely thanks to progress by the beneficiaries of the Cohesion Fund (Spain, Portugal, 
Greece and Ireland), where per capita income rose from 66% to 74% of the Community 
average. The most remarkable results were recorded in Ireland, with annual growth rate of 
4.5% between 1983 and 1995, followed by Spain (3.0%) and Portugal (2.6%). 
In terms of employment, the results are less clear-cut. In Ireland, where economic growth was 
highest, employment increased by only 0.2% per year between 1983 and 1993, despite a recent 
upturn. The situation is similar in many other Member States, while the deep recession in 
Finland and Sweden has resulted in a fall in the actual number of jobs in those countries. In the 
Netherlands. Germany. Greece and Spain, the rate of job-creation has been above average. 
In Portugal. Belgium, western Germany, the Netherlands and the United Kingdom, the rate of 
job-creation, although variable, has been high enough to reduce the rate of unemployment. In 
most other countries, by contrast, unemployment has risen, most dramatically in Finland and 
Sweden but also in two of the four countries eligible under the Cohesion Fund, Spain and 
Greece, where unemployment has increased sharply. In Spain, more than one potential worker 
in five is now unemployed. 
Within the Union, disparities in unemployment have increased. Unemployment is a problem 
which affects the whole of European society but its impact on different social groups varies: 
unemployment among those aged under 25 is almost twice as high (21% in the first half of 
1996) than the overall rate. Unemployment amongst women is also high: 12.5% in the first half 
as against 9.5% for men. Furthermore, those with only a basic level of training are harder hit 
than those with further qualifications (an unemployment rate of 13% as against 9% in 1994). 
OJNo L 152, 18.6.1994, p. 39. 
Annual report of the Cohesion Fund 1996 
CHAPTER 1 - Implementation of Cohesion Fund principles 13 
Long-term unemployment is very worrying: in 1995, 49% of those unemployed had been 
without a job for over a year and 25% for over two years. These figures confirm that 
unemployment is a serious structural problem in Europe which excludes certain social groups 
from the labour market. 
The impact of unemployment on poverty cannot be denied. Statistics seem to show that poverty 
is increasing throughout the Union, particularly in a number of northern Member States. 
Annual report of the Cohesion Fund 1' 
CHAPTER 2 - Financial assistance committed and paid by the Fund 14 
CHAPTER 2 
FINANCIAL ASSISTANCE COMMITTED AND PAID BY THE FUND 
2.1 BUDGET AVAILABLE 
At the Edinburgh European Council in December 1992. the Heads of State and Government 
decided to grant ECU 15 150 million (at 1992 prices) to the four beneficiary Member States for 
the period 1993-99. The year-by-year breakdown of the appropriations'is as follows: 
ECU million (1992 prices) 
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 
Subsequenth. adjustments for inflation meant that, after indexation, commitment 
appropriations for 1993, 1994. 1995. 1996 were set at ECU 1 565 million, ECU 1 853 million. 
ECU 2 152 million and ECU 2 444 million respectively. 
Payment appropriations for those years totalled ECU 1 000 million, ECU 1 679 million, ECU 
1 750 million and ECU 1919 million. 
As in 1995. the budgetary authority (the European Parliament and the Council of the European 
Union) decided, in 1996. to transfer ECU 300 000 to the budget line managed by UCLAF (the 
Anti-Fraud Coordination Unit) to provide it with both commitment and payment appropriations 
to combat fraud connected with the Cohesion Fund. This transfer increased the commitment 
appropriations available to the Cohesion Fund in 1996 to ECU 2 443.7 million and the payment 
appropriations to ECU 1919 million. 
In view of the above, the 1997 budget was set at ECU 2 748.7 million in commitment 
appropriations and ECU 2 325.7 million in payment appropriations. 
2.2 BREAKDOWN BY MEMBER STATE 
An indicative breakdown of these amounts was then carried out pursuant to Annex I to the 
Regulation, which lays down brackets of 52% to 58% for Spain. 16% to 20% for Greece and 
Portugal and 7% to 10% for Ireland. 
The table of indicative brackets was therefore as follows: 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 15 
Member 
State 
1993 
1994 
1995 
1996 
1997 
1998 
1999 
TOTAL 
93/99 SPAIN 
52% 
780 
910 
1040 
1 170 
1300 
1326 
1352 
7 878 55% 
825 
962.5 
1 100 
1 237.5 
1 375 
1 402.5 
1430 
S 332 J 58% 
870 
1 015 
1 160 
1 305 
1 450 
1479 
1508 
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 ECU million (1992 prices) 
IRELAND 
7% 
105 
122.5 
140 
157.5 
175 
178.5 
282 
1 I6Ô.5 9% 
135 
157.5 
180 
202.5 
225 
229.5 
234 
I 363.5 10% 
150 
175 
200 
225 
250 
255 
260 
1515 
2.3 BUDGET IMPLEMENTATION 
Commitments for 1996 at 31 December totalled ECU 2 443.64 million, 99.99% of the 
appropriations available. The table below shows the breakdown of Cohesion Fund commitments 
bv Member State and bv sector. 
Commitment appropriations -
•M.S. 
£ 
GR 
IRL 
P 
TOTAL 
Tech. Ass. 
TOTAL Environment 
663 549 515 
235 865 092 
99 920 131 
217 966 578 
1217 301316 
-
1217 301316 1996: ECU 2 443.7 million 
% 
49.44 
53.81 
45.07 
49.59 
49.86 
-
49.89 Transport 
678 383 056 
202 441 610 
121 770 026 
221 526 518 
1 224 121 210 
-
1 224 121 210 % 
50.66 
46.19 
54.93 
50.41 
50.14 
-
50.11 ECU mil 
Total 
1341 932 571 
438 306 702 
221 690 157 
439 493 096 
2 441422 526 
2 212 643 
2443 635 169 lion 
Allocation 
54.91 
17.94 
9.07 
17.99 
99.91 
0.09 
100.0 
The unused balance of commitment appropriations was: (2 443 700 000 - 2 443 635 169) = + ECU 64. 831 
Air • xal report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 16 
Payment appropriations -1996: ECU 1 919 million 
ECU million 
M.S. 
E 
GR 
IRL 
P 
TOTAL 
Tech. Ass. 
TOTAL Brviroriment 
295 940 565 
127 062 978 
80 315 065 
124 133 591 
627 452 199 
-
627 452 199 % 
26.61 
51.91 
42.46 
38.2 
33.54 
-
33,52 Transport 
816 116 839 
117 689 309 
108 805 171 
200 762 086 
1 243 373 405 
-
1 243 373 405 % 
73.38 
48.08 
57.53 
61.79 
66.46 
-
66.46 Total 
1 112 057 404 
244 752 287 
189 120 236 
324 895 677 
1 870 825 604 
1 156 625 
1871982 229 Allocation 
59.4 
13.07 
10.10 
17.36 
99.94 
0.06 
100 
Balance of payment appropriations: (1 919 000 000 - 1 871 982 229) = 47 017 771 (2.25%). 
Implementation of appropriations for payments for 1996 amounted to 97.75%. 
Appropriations to combat fraud (see also Chapter 2.1 of this Report) 
Appropriations made available: ECU 300 000 used by UCLAF from budget heading 3010. 
2.3.1 SPAIN 
Environment 
The projects submitted by Spain in 1996 confirmed the national priorities for the environment: 
principally the provision of infrastructure to supply water for domestic use and to treat waste 
water, the management of urban, toxic and dangerous waste, afforestation, the planning and 
restoration of the coastline and the urban environment. 
All these measures apply throughout the country. This year, particular attention was paid to 
providing increased finance for measures on the Canary Islands as one of the most remote 
regions. These include desalination plants, coastal improvements and the widening of road GC1 
at Tenerife. 
The strategy for the submission of projects is based on national or sectoral plans, or on legislation 
adopted by the Autonomous Communities, in order to ensure a significant impact in the sector 
concerned. 
Spain submitted the following groups of projects: 
0 groups of operationally related projects, dealing with the supply of drinking water, undertaken 
bv the national administration; 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 17 
0 groups of projects concerning drainage and water treatment, undertaken by local authorities 
under the national sectoral plan: 
0 groups of projects concerning the treatment of urban waste adopted at regional level and 
carried out by a number of municipalities under the Plan on waste management being 
approved or legislation. 
As in 1995. priority was given to drainage and water treatment projects submitted by 
municipalities and intended to implement Directive 91/271/EEC on waste water in order to 
achieve the objectives laid down for 1998 and 2000. Further finance was also provided for 
projects submitted by the Autonomous Communities during the previous year and adopted in 
annual instalments. 
A greater number of large-scale projects for the supply of drinking water was submitted: these 
included the Casrama system in Madrid and the desalination plants at Ceuta and in the Balearic 
and Canary Islands. 
In the other sectors of the environment, the continuing high level of applications for assistance 
made by the Spanish authorities in 1996 reflects the persistent difficulty in proposing large-
scale projects in the various sectors eligible for assistance. This aspect is also linked to the 
strategy of decentralising implementation to a number of bodies, such as the central 
administration and the regional and local authorities. 
In 1996. the Spanish authorities submitted 48 applications for Cohesion Fund finance in the 
sector of the environment; total assistance amounted to ECU 795.5 million. 
The Commission adopted 69 new decisions concerning some 589 projects and measures in the 
field of the environment in Spain. During 1996, assistance totalling ECU 663.6 million was 
provided towards eligible costs of ECU 1 001 million. This represented 49.5% of the total 
assistance allocated to Spain from the Cohesion Fund. The decisions adopted in this field in 
1995 resulted in a financier commitment of ECU 31.6 million in 1996. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
Projects approved broken down by sector 
Sectors 
Supply and quality control of 
water 
Waste 
Drainage and water treatment 
Urban environment 
Afforestation 
Coasts 
TOTAL Environment 
Budget 1996 Total cost 
ECU 
270 510 625 
97 509 139 
482 056 374 
79 681 467 
42 758 247 
28 893 322 
1 001 409 174 Assistance 
ECU 
229 579 585 
78 007 307 
388 866 478 
63 745 170 
33 313 468 
24 559 324 
818071 332 Commitments 
1996 
ECU 
151 703 799 
89 644 443 
300 593 456 
63 745 170 
33 313 468 
24 559 324 
663 559 660 % 
23% 
14% 
45% 
10% 
5% 
4% 
100% Number o 
decisions 
10 
19 
24 
12 
3 
1 
69 Number of 
projects 
41 
49 
85 
14 
386 
14 
589 
More details highlighting the most important projects are given below. The projects approved 
also comply with the priorities set out in the Fifth Community Action Programme on the 
Environment and Sustainable Development, the objectives of Article 130r of the Treaty and the 
requirements for implementing the Community Directives on the environment. 
• Water supply 
Before approving the national water plan. Spain decided to draw up a White Paper setting out 
the objectives and priorities for measures in this area. 
In 1996 the Cohesion Fund's contribution to this sector represented 23% of the resources 
available for environmental projects, or about ECU 152 million for 41 projects grouped in 10 
decisions. 
The decisions adopted in this sector had three main objectives: 
0 to increase the population served by infrastructure to distribute drinking water, facilitate the 
sustainable development of the area in question and improve the quality of water to the 
levels laid down by Community Directives. These include the Casrama system in Madrid 
and other measures to continue projects already approved in the inter-municipal body 
linking Algodor and Almoguera-Mondejar: 
0 to ensure supplies of drinking water to those affected by drought by improving health 
conditions and quality of life of the people concerned. To this end. the Cohesion Fond 
financed desalination plants in Palma de Majorca. Calvia. Ceuta and Tenerife, since it 
considered this"solution to be the best way of achieving the water quality laid down by the 
Communitv Directives and overcomiim obstacles created bv the lack of water: 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
0 stepping up the introduction of water information systems by installing such a system on the 
Tagus and extending measures to improve water systems and the environment already 
financed by the Cohesion Fund in 1994. 
The infrastructure financed will also help preserve aquifers, reduce the over-exploitation of 
ground water and check erosion and desertification in accordance with the Fifth Communitv 
Action Programme on the Environment and Sustainable Development. 
• Treatment of waste water 
On the basis of the guidelines laid down in the national plan for the drainage and treatment of 
waste water adopted in February 1995. Spain continued during 1996 its investments in this 
sector in order to meet its obligations under Directive 91/271 /EEC by the deadline. 
The Cohesion Fund continued to make a substantial contribution to this work: 45% of part-
financing for Spain in the environment sector concerned projects for the drainage and treatment 
of urban waste water. Of the ECU 300 million committed. ECU 31 million was accounted for 
by annual instalments of decisions adopted in 1995 while the remainder was committed to 
cover 24 new decisions comprising a total of 85 projects. 
Because of the decentralisation of responsibility in this sector in Spain. 20 of these new 
decisions concerned applications for aid from municipalities responsible firstly for the 
implementation of the projects and then for the operation and maintenance of plant. 
When considering these aid applications, the Commission paid particular attention to ensuring 
that the infrastructure complied with the environmental requirements imposed by Community 
legislation, and in particular Directive 91/271 /EEC. Similarly, in order to ensure that the 
projects financed form part of a complete drainage system, any grant for a waste-water 
collector is dependent on its being linked to a treatment plant. 
The infrastructure financed combines measures to improve the environment by reducing the 
burden of pollution in the effluent discharged and by helping improve the quality of surface and 
bathing water and preventative measures to protect ecosystems and public health. Some 
projects include programmes for reusing water, so facilitating more rational utilisation of water 
in the areas worst affected by drought. 
• Waste management 
The amount corresponding to commitments in the 1996 budget for the waste sector was 
considerably higher than in 1995. However, of the 16 new aid decisions covering a total of 49 
projects. 12 corresponded to aid applications submitted in 1995 but still under consideration at 
the beginning of 1996. 
This is the sector whose management is most decentralised: ten decisions concern applications 
submitted by municipalities and the other six applications from Autonomous Communities. Of 
these applications, which were adopted in February 1995 and comply with the Community 
priorities and criteria laid down, particularly by Directive 91/689/EEC laying down parameters 
for hazardous waste, three form part of the national strategy on hazardous waste for 1995-2000 
and the restoration of contaminated soil for 1995-2005. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 20 
The other decisions concern projects to improve the management and treatment of urban waste 
and follow the guidelines laid down in the regional plans on waste and the agreements between 
those responsible for the environment at national level and the local authorities. They concern 
plant to facilitate the selective collection of waste at the point of sorting, the most efficient 
form of transport and the establishment of transfer centres, exploitation through recycling and 
composting and the filling in and sealing of old tips of the restoration of certain existing tips. 
All these measures are in line with the relevant Community policy, particularly Directive 
91 !\56 EEC. 
• Afforestation 
In 1996. the Spanish authorities submitted the applications for aid for afforestation projects 
under the afforestation Plan drawn up for 1995-99, which includes measures for afforestation, 
combating erosion and desertification which form part of the national Plan for the restoration of 
water and forestry resources drawn up for each water system. 
As in 1995. the projects were submitted by the national administration and the Autonomous 
Communities grouped by water system. 
In this field, three decisions concerning applications for aid submitted in 1995 were adopted: 
they include 366 measures to restore plant cover through afforestation, the treatment of forests 
to improve existing vegetation, work on the maintenance of seasonal water-courses, the 
consolidation and strengthening of banks and their stabilisation against land-slips by means of 
dykes and breakwaters. Other complementary measures were planned, including improvements 
to water systems which have deteriorated. 
The applications for aid made in 1996 were subjected to a multicriteria analysis which will 
determine the projects likely to be financed by the Cohesion Fund in 1997. 
• Improvement and restoration of the coastline 
The coastline of Spain is 7 880 km long, of which 4 900 km is accounted for by continental 
Spain and 2 890 km by the islands. This part of the territory, which accounts for 7.2% of total 
surface area, is home to 35% of the country's population and receives almost all (85%) 
seasonal visitors. This pressure, which has resulted in the degradation of the coastline, has led 
the Spanish Government to undertake measures to protect and restore the coast. In 1983 an 
action plan for the coasts was introduced and a law on the coasts was published in 1988. This 
integrated planning for coastal protection underlies the measures in this area submitted for 
financing. 
As in previous years, a large number of the projects concerning the coasts divided into three 
categories were submitted by the central administration. 
They concern the restoration and renewal of beaches to reverse the process of erosion, the 
planning of the coast to restore its advantages and nature as it is present on the seashore and the 
restoration of the coastal environment to protect, conserve and restore the natural features of 
areas of considerable ecological value. 
In coordination with those responsible for the projects, targeting of the assistance to be 
provided has been improved and 14 projects were approved through a decision covering the 
An. .tial report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
three categories mentioned. Four projects are in the remote region of the Canary Islands and the 
remainder on the Atlantic and Cantabrian coasts. 
• Urban environment 
As in previous years, projects concerning the urban environment were submitted on the basis of 
the objectives of the Fifth Community Action Programme on the Environment and Sustainable 
Development. 
The Commission adopted 14 projects through 12 decisions which accounted for 10% of the 
1996 budget allocated to the environment in Spain, or ECU 63 745 170. 
The projects, which were submitted by the municipalities, are in Madrid. Catalonia and 
Aragon. 
They are intended to improve the quality of life in urban areas where environmental problems 
weigh most heavily on those living there. To that end, finance has been provided to restore a 
historic area of Madrid through integrated planning measures and the creation of green areas, 
monitoring of atmospheric pollution in Madrid, the reduction of noise levels on the first 
Barcelona ring road and the restoration of run-down parks and green areas. 
Other measures financed in this sector include the restoration of natural areas, improvements to 
river banks and the creation of green areas and parks in urban area to protect rivers and 
improve water quality. 
It is interesting to note that most of the projects concerning the urban environment approved in 
1996 will provide benefits in a number of ways: the creation of green areas, the removal of 
contaminated soil and improving water quality in rivers. 
This will increase the impact of the Cohesion Fund on development in the area of the 
environment in Spain. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund -n 
Solid Waste 
Treatment funded by the 
Cohesion Fund 
SPAIN 
% Barcelona 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 23 
Dam and reservoir 
River training works 
funded by the 
Cohesion Fund 
SPAIN 
Barcelona 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 24 
Water Source 
Water Supply 
Water 
Treatment 
Projects funded 
by the 
Cohesion Fund 
SPAIN 
Barcelona 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 25 
Sewerage Wastewater 
Treatment funded by the 
Cohesion Fund 
SPAIN 
* 
* 
Air ial report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 26 
Transport 
In 1996 the Cohesion Fund continued to make an important contribution to the financing of 
Spanish transport infrastructure projects, principally road and rail, in line with the objectives of 
the "Plan Director de Infraestructuras 1993-2007" and the Community's guidelines for the 
development of the trans-European transport network. A total of ECU 678.38 million of 
assistance from the Fund was committed to transport projects in 1996, representing 50.5% of 
the total allocation for Spain. This includes commitments for new projects, or stages of 
projects, as well as commitments relating to the 1996 annual instalments of projects approved 
in previous years. One amendment to an earlier decision was also approved during the year. 
As shown in the following table, commitments relating to road projects in 1996 accounted for 
ECU 567.37 million (83.6% of the transport total) and to rail projects ECU 111.02 million 
(16.4%). 
Transport projects in Spain: 1996 commitments 
SECTOR 
ROADS & MOTOR II A YS 
RAILWAYS 
TOTAL TRANSPORT TOTAL COST 
(ECU MILLION) 
i 
1 783.068 
314.028 
2 097.096 GRANT 
APPROVED 
(ECU MILLION) 
1 506.529 
266.924 
1 773.453 COMMITMENTS 
1996 
(ECU MILLION) 
567.367 
111.016 
678.383 % 
83.6 
16.4 
100.0 NO OF 
DECISIONS 
16 
2 
18 
Note: includes projects approved in previous years 
• Roads 
A major part of Cohesion Fund assistance was devoted to road projects in 1996. as in previous 
vears. reflecting the need to complete and upgrade the extensive trunk road system in Spain in 
response to the continued growth of traffic. All assisted projects relate to the trans-European 
road netw orks and are intended to achieve the objectives of the TENs and of the general plan 
for roads in Spain. These include the completion of sections of the most heavily used motorway 
corridors: the connection of outlying regions with the major centres of economic activity: the 
offsetting of the excessively radial structure of the Spanish road network: the relief of urban 
congestion: and the integration of the Spanish road network with that of its immediate EU 
neighbours. 
In line with these objectives, the Cohesion Fund has since 1993 concentrated assistance on the 
following main corridors and sections of the Spanish motorway and express road system: 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
Corridor/section Length* Grant 
Kms 1993 - 1996# 
(ECU million) 
Rias Bajas motorway 
(Galicia-Madrid-N.Spain-France) 276 718.75 
Madrid ring road M40 35 272.99 
Madrid-Granada 
(Bailén-Granada) ]16 270.10 
Zaragoza-Huesca-Somport-France 
(incl. Somport tunnel) 70 187.58 
Mad rid-Valencia 57 123.50 
Costa Cantâbrica 
(Galicia-Irùn) 38 102.07 
Trans-Catalonia highway 
(Lérida-Gerona) 36 58.62 
* length of section constructed or improved with Cohesion Fund assistance 
# total grant approved under the interim financial instrument and the Cohesion. F.und to end 1996 
all figures have been rounded 
In 1996 nine decisions relating to new projects, or new sections of existing projects, were 
approved involving a total Cohesion Fund grant of ECU 590.97 million, of which ECU 329.29 
million was committed from the 1996 budget. In addition, commitments amounting to ECU 
213.14 million were made relating to the 1996 instalments of six projects approved in previous 
years, and a commitment of ECU 24.95 million was made in the form of an amendment to an 
earlier decision. In total, commitments in favour of road projects amounted to ECU 567.37 
million in 1996. bringing the overall total committed from the Cohesion Fund to roads and 
motorways in Spain since 1993 to ECU 1 786.11 million. 
The following are the main motorways and trunk roads for which decisions were approved in 
1996: 
• Rias-Bajas motorway 
The main purpose of this motorway, which covers a total of 300 km. is to connect Galicia with 
the main Spanish road network and corridors to France. It will also provide an important 
alternative outlet for traffic from North Portugal to Northern Spain and the rest of Europe. The 
section from Porrino. at the western extremity of the corridor, to Orense was approved for 
assistance in 1995 (Cohesion Fund grant ECU 212.84 million). 
In 1996 approval was given for two additional sections of the route as follows: 
Annual repon of the Cohesion Fund 19% 
CHAPTER 2 - Financial assistance committed and paid by the Fund 28 
Section 
Camarzana de Tera-Rio Mentes 
Rio Mentes-Fumaces Length 
182.6 km 
14.5 km Project Cost 
ECU million 
512.64 
59.12 CF grant 
ECU million 
435.74 
50.25 1996 
commitment 
ECU million 
212.47 
20.19 
In addition, a commitment of ECU 51.09 million was made in respect of the 1996 instalment 
for the Orense-Porrino section referred to above. Total assistance approved for this project so 
far under the Cohesion Fund and the earlier financial instrument, which financed the initial 
feasibility studies, amounts to ECU 718.75 million. A request for assistance relating to the final 
section of the motorway. Benavente-Camarzana de Tera. was received at the end of November 
1996. The projects as a whole is expected to be completed by end 1999. 
• Trans-Catalonia highway 
A new section of this road corridor - Artés to Sta. Maria de 016 - was approved for assistance 
from the Fund in 1996 with a total grant of ECU 15.49 million. Including another section which 
was approved for assistance in 1994. total assistance from the Cohesion Fund towards this 
project amounts to ECU 58.62 million. 
This road axis, which will ultimateh' connect Lérida with Gerona, is intended to avoid the 
congested area around Barcelona and open up a direct route from central Spain to the North 
Eastern coastal area and routes to France. The road axis will provide a link between three major 
trans-European network corridors: the A7 motorway at Gerona, the E9 motorway at Manresa 
and the A2 at Lérida. 
Related projects approved for finance by the Cohesion Fund in 1995 include the Lérida by-pass 
(ECU 80.34 million) and the Baix Llobregat motorway (ECU 129.91 million). 
• Express roads in the Basque Country7 and Navarra 
Four projects were approved in 1996: 
0 N 121-Puerto de Velate 
This project, for which total assistance from the Fund of ECU 24.15 million was committed, 
involves the construction of two tunnels and associated access roads which are aimed at 
reducing the height of the Velate pass, thus improving traffic speed and road safety. The overall 
objective of the project, which is located on the Pamplona-Behobia route, is to improve 
communications between the Ebro valley and south west France. 
0 Motorwav connection NI with A8 
This project consists of a new section of motorway connecting the NI highway at the Lasarte-
Oria interchange with the A8 motorway in the vicinity of Aritzeta, with associated access 
sections (totalling 4.42 km). Its principal objective is to provide a better connection between 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 29 
the two major road corridors while avoiding'existing congestion around San Sebastian. 
Assistance from the Fund of ECU 16 million was approved for the project. 
0 NI motorwav Salvatierra-Navarre 
A new 1 1 km section of motorway is involved in this project on the Nl which connects Vitoria 
with Pamplona (Navarre) and with San Sebastian and the French border crossing at I run. The 
overall objective is to improve north-south connections and communications between the 
Basque country and its neighbouring communities. Assistance committed to the project from 
the 1996 budget totalled ECU 9.28 million. 
0 Motorwav Guipi'izcoa-Navarre 
This project, for which ECU 8.45 million of assistance was committed in 1996, concerns work 
on two sections of the new A15 motorway and the associated tunnels. The motorway links 
Guipi'izcoa (San-Sebastiân/Irùn) with Navarre (Pamplona) and is intended to improve national 
connections as well as international communications between the Ebro valley, the Autonomous 
Communities of eastern Spain and south west France. 
• Seville-Granada-Almeria motorway 
This project consists of work on the by-passes of Guadix and Alcudia de Guadix involving a 13 
km section of motorway for which a total grant from the Fund of ECU 16.06 million was 
approved, with ECU 7.71 million committed from the 1996 budget. The project will contribute 
towards the completion of the important motorway route between Seville, Granada and 
Almeria. 
• GC1 motorway, Gran Canaria 
Assistance of ECU 15.54 million was approved for this project which is aimed at improving the 
heavily used GCI motorway, the major route on the island. 
The following table summarises the situation regarding 1996 budgetary commitments made in 
favour of roads and motorway projects in Spain including the new decisions approved during 
the year as well as annual instalments for projects approved in earlier years: 
Annual report of the C hesion Fund 
CHAPTER 2 - Financial assistance committed and paid by the Fund 30 
Road/Motorway Type of commitment 1996 commitments 
ECU million 
Rias Bajas Motorway 
Camarzana de Tera-Rio Mente new section 212.465 
Rio Mente-Fumaces new section 20.188 
Orense-Porrino '96 instalment 51.085 
Trans-Catalonia highway 
Artés-Sta. Maria de 016 new section 15.493 
Lérida by^sass '96 instalment ' 13.067 
Bailén-Granada motorway 
Bailén-AIboîote '96 instalment 24.421 
Somport tunnel (stage II) '96 instalment 21.456 
Baix Llobregat motorway '96 instalment 54.014 
Zaragoza-Huesca motorway '96 instalment 49.091 
Villanoeva de Gàllego-Huesca 
NÎ21 Puerto de Velate new section 24.154 
Connection N1-A8 motorway new section 16 002 
(Gorpûzcoa) 
NI motorway Salvatierra-Navarra new section 9.279 
A15 motorway Guipôzcoa-Navarra new section 8.452 
SeviDe^jianada-Almeria motorway 
Guadix by-pass new section 7.712 
GC1 motorway Gran Canaria new section 15.535 
N234 Gilet-Soneja modification 24.951 
Total 1996 commitments 567.367 
All these projects form part of and continue the established overall approach of the Cohesion 
Fund, i.e. to contribute to the completion of the high priority road sections of the Spanish 
transport corridors. 
• Railways 
The infrastructure master plan 1993-2007 includes a number of programmes for the rail 
infrastructure network, including high-speed lines, structural measures, secondary lines, the rail 
network, safety, conservation and maintenance. 
\nnual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 3 ] 
In 1996. the Cohesion Fund continued to provide assistance in accordance with the two 
guidelines for the railways adopted during 1995 and which form part of the various measures 
forming part of the programme of structural measures in that Plan and the trans-European 
Transport Network, including major and secondary access, the modernisation of railway track 
and adjustments to speeds: 
0 third stage of adaptation of the "Mediterranean Corridor" conventional line: the aim of this 
project is to raise speeds to 200/220 km/h on a section which forms part of a priority 
corridor whose two earlier stages were financed in 1993 and 1994. The commitment to be 
met from the 1996 budget amounted to ECU 81 702 278: 
0 modernisation of the conventional rail network: this project includes a number of measures 
throughout the network. The commitment to be met from the 1996 budget amounted to ECU 
29 313 774. 
The strategic objective is a high-quality rail network. The measures are intended to introduce 
high running speeds on the main railway lines. 
As regards the high-speed lines, the Catalayud-Riola and Zaragoza-LIeida sections of the 
TGV-south Madrid-Barcelona line have been submitted for finance from the Cohesion Fund. 
Their adoption will take account of completion of the whole of the line. The Spanish authorities 
have been asked to provide details of cost and of the economic and environmental impacts. 
However, no reply was received in 1996. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by (he Fund 
Trans European 
Rail Network 
Cohesion Fund 
SPAIN 
Barcelona 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
Trans-European 
Road network 
Cohesion Fund 
SPAIN 
Barcelona 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 34 
2.3.2 PORTUGAL 
Environment 
The projects adopted by the Cohesion Fund in 1996 continue the strategy of assistance 
followed since 1993 which seeks to provide infrastructure for the supply of drinking water, the 
treatment of waste and run-off water and the management of solid urban waste. 
The projects chosen are those of the greatest significance in these fields which will provide 
systems for the most densely populated parts-of the country. 
A large number of the projects submitted or approved in 1996 continue operations financed in 
the past, either by the cohesion financial instrument or the Cohesion Fund. Examples include 
the systems to supply drinking water to the region of greater Oporto south and the continuing 
construction of water supply systems in the Algarve. 
The following points should be noted: 
0 the considerable effort made by Portugal in these three areas. This effort, part-financed by 
Cohesion Fund assistance, is intended to bring about very substantial changes in these 
sectors. The Cohesion Fund assistance, which is concentrated on a limited number of 
systems whose implementation is regarded as a priority and whose economic and 
environmental impact is greatest, will make a decisive contribution to achieving these 
results; 
0 the establishment of inter-municipal bodies to manage the largest projects concerning both 
drinking water and waste. In most cases, a central body takes a holding in these inter-
municipal bodies and has a supervisory role. This solution should both enable those 
concerned to participate in the management and implementation of the systems and ensure 
the coordination and maintenance of technical and organisational skills. There will usually 
be economies of scale and more efficient implementation and management of the systems 
may be expected. 
In 1996, the Portuguese authorities submitted for Cohesion Fund finance 23 new applications 
for aid in the field of the environment totalling ECU 508.0 million towards a total investment 
of ECU 597.9 million. 
The Commission adopted 21 environmental projects in Portugal (10 of which had been 
submitted in 1995). Total eligible investment was ECU 620.6 million and assistance amounted 
to ECU 527.7 million, of which ECU 166 million would come from the 1996 budget. 
In 1996, after a fairly long running-in period, investment in the environment began to absorb a 
very large proportion (about 50%) of the resources of the Cohesion Fund. This trend should 
increase in the vears to come. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund J:> 
Breakdown by sector of decisions to grant assistance adopted in 1996 
Sectors 
Waste water 
Supply of drinking 
water 
Waste 
Total Number of 
projects 
11 
4 
6 
21 Assistance 
(ECU m) 
117.6 
214.8 
195.5 
527.7 % 
22.3 
40.7 
37.0 
100 Commitment 
1996 budget 
(ECU m) 
65.5 
25.3 
75.3 
166 % 
31.5% 
15.1% 
45.4% 
100% 
In addition to the ECU 166 million committed as a result of decisions adopted in 1996, ECU 
43.3 million was committed in 1996 to finance projects adopted in previous years and ECU 8.7 
million to provide further assistance for nine projects adopted earlier. 
This means that 49.6% of the Cohesion Fund budget allocated to Portugal for 1996 was used 
for projects in the field of the environment. 
Commitments in 1996 were broken down as follows: 
Breakdown of appropriations by sector in 1996 
Sectors Commitments 1996 % 
(ECU m) 
Waste water 72L8 33.4% 
Supply of drinking water 6ÏÏ2 28.1% 
Waste 753 34.5% 
~Ôthï? 8^ 4B 
"Total 2Î8 100% 
Supply of drinking water 
5 Further funding for nine projects. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
The Cohesion Fund assistance requested in 1996 was intended to increase the percentage of the 
population of Portugal supplied with mains drinking water and ensure the levels of service and 
quality laid down by Community directives. In 1990, the percentage of the population of 
Portugal supplied with mains drinking water (77%) was still below the Community average 
(95%). Considerable progress has been made since then, mainly thanks to infrastructure 
provided by means of Cohesion Fund assistance. 
In 1996. the Cohesion Fund's contribution to this sector represented 28.1% of the resources 
available for environmental projects, about ECUO 61.2 million. 
The projects adopted in 1996 concerned mainly the implementation or improvement of large 
regional-scale systems serving large metropolitan areas and a substantial percentage of the 
population. 
0 There are water supply systems in the region of Oporto (north and south) which serve 
virtually all the municipalities around Oporto and the city itself. These systems are managed 
as concessions by specialist companies, which makes for more efficient management and 
means that the municipalities in question, which have a capital holding in the management 
company, are involved. 
The systems financed include those for the catchment and treatment of water and for 
supplying drinking water up to the reservoirs of each municipality. They increase the 
economies of scale at the level of the treatment and production of water. 
Finance for a number of municipalities making up the greater Oporto south system (the Vale 
de Cambra sector, improvements in Vila Nova de Gaia and the Valongo sub-system) was 
approved in 1996. The second stage of the system to supply greater Oporto north was also 
approved. The Fund will contribute ECU 166 million (of which ECU 18.4 million was 
committed from the 1996 budget) to these projects. 
0 The Cohesion Fund approved a project for the Lisbon metropolitan area covering a system 
to supply water to Lisbon and the Tagus Valley. The project financed forms part of a larger 
programme of assistance to which the Cohesion Fund has already contributed about ECU 60 
million and which should increase the capacity of the distribution network for Lisbon and 
the Tagus Valley from the Castelo de Bode dam and the Asseiceira treatment station. It will 
serve some 15 000 people whose water at present comes from underground sources which 
are inadequate as regards both quality and quantity. ECU 4 million was granted to this 
project. 
0 In the south, the Cohesion Fund made a substantial contribution in the Algarve for large 
projects to capture and distribute water in all the municipalities in the region: the water 
supply system for the western part (Barlavento) was approved in 1996 and will receive 
assistance totalling ECU 43 million (of which ECU 2.1 million was committed from the 
1996 budget). 
Finance from the Fund will be used to construct a system with two treatment stations, two 
regulating reservoirs, two supply pipes and an automatic management system to serve a 
population put at 1 50 000 permanent residents but rising to 350 000 in the high season. 
• Treatment of waste water 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 37 
During 1996 Portugal made significant progress in implementing the Community Directives on 
waste water, particularly Directive 91/271/EEC. 
Nevertheless, the introduction of treatment systems in this sector is still lagging well behind the 
deadlines laid down in the Directive so the efforts made must be maintained and even stepped 
up. 
In 1996 commitments by the Cohesion Fund for this sector accounted for 33.4% of resources 
allocated to environmental projects. 
As far as assistance granted as a result of new decisions is concerned, the sector received 40.7% 
of the appropriations allocated to the environment. 
0 In 1996. in the densely populated area of Oporto the Cohesion Fund granted assistance 
worth ECU 10.6 million for a project to clean up the basin of the river Leça (Greater-
Oporto South, Matosinhos-Leça area). The project should clean up the Leça and other 
smaller water courses and ensure a marked improvement in the quality of water at the coast. 
The project will help implement Directive 91/271/EEC and the level of treatment of the 
final effluent should, in particular, take account of the sensitivity of the area of reception. 
Taken as a whole, the assistance provided in the Leça basin will benefit some 76 000 
people. 
In the same area, the Cohesion Fund financed one stage of a project concerned with the 
treatment of water fi-om the municipalities of Vila do Conde and Povoa do Varzim 
(assistance totalling ECU 3.5 million). 
0 Another large project concerns cleaning up the Sesimbra basin. It includes the interceptor 
system, the collectors, pumping stations, discharges and a treatment station for waste water. 
The geographical location of the Sesimbra basin, the rugged topography of the area and the 
fact that part of the area is in the Arrâbida natural park require complex solutions which are 
expensive. The project should put an end to the discharge into the sea of urban effluent by 
providing complete treatment and final disposal by means of submarine pipes to meet the 
quality standards laid down in Directive 91/271/EEC for the treatment of waste urban water 
(assistance granted: ECU 6.6 million). 
0 The Cohesion Fund granted finance for the first stage of a project for the dredging and 
cleaning up of the ria de Aveiro (assistance: ECU 4 million). This is an area of the greatest 
environmental importance comprising a lagoon classified as a special protection area for 
birdlife under Directive 79/409/EEC on the conservation of wild birds. The project is also 
intended to improve the hydrodynamics of the Ria de Aveiro, check coastal erosion. 
strengthen the barrier of dunes and reverse the process which is threatening to make the 
lagoon disappear. This project is linked to other projects financed in the past in the same 
area, such as the system to treat liquid effluent in the Ria de Aveiro. 
0 In the Algarve, the main work of the Fund in 1996 involved the second stage of the project 
concerning the collection of waste wafer and the Portimâo treatment station, the first stage 
of which was also financed by the Fund. The project forms part of the general project for 
the complete upgrading of the Barlavento Algarvio which has been designed to provide the 
requisite integrated solutions and economies of scale. Total investment is planned to reach 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 38 
about ECU 80 million. En 1996 the Cohesion Fund granted assistance worth ECU 7.7 
million. The general objective of the Barlavento Algarvio network, in a region which 
includes protected areas and is of great environmental value, is to ensure the protection of 
an environment which is subject to growing pressure from the growth of towns and tourism. 
In the same region, the Cohesion Fund also financed the waste-water treatment system in 
Aljezur (ECU 1.3 million). 
0 During 1996 the Cohesion Fund provided assistance in the region of Sotavento Algarvio for 
the system for the treatment of waste water in Louie. 
• The Cohesion Fund financed four projects in the Lisbon metropolitan area which form part 
of an overall strategy to improve water quality in the estuaries of the Tagus and on the coast. 
The Fund granted assistance for a new stage of the project to clean up the Estoril coast 
which will complete the system for that coastline, so providing full coverage for the 
municipalities of Oeiras and Cascais and improving a bathing area where pollution is very 
severe. The system will meet the needs of the population of 600 000, which could grow to 
1.5 million over the life of the project. 
In the Chelas area, the Cohesion Fund financed the extension to the network of collectors 
and the work to enable the treatment station to meet the parameters laid down in Directive 
91/271/EEC. More intensive treatment should mean that the effluent can be used for 
irrigation and to clean urban areas. The project is to receive assistance worth ECU 21.8 
million, of which ECU 3.7 million was committed in 1996. 
The Fund also contributed ECU 25.8 million to finance work on regulating the flow of the 
river Trancào. and removing and treating polluted mud. The river is in a very urban area 
which has benefited from a series of measures which began at the end of the eighties, some 
of which (two treatment stations in particular) have already received assistance from the 
Cohesion Fund. The removal of polluted mud and the régularisation of the course of the 
river should mean that lasting benefit can be derived from this work. The project should also 
continue to restore biotypes (vegetation and habitat) in the Tagus estuary. 
On the same river, the Cohesion Fund provided ECU 1.3 million of assistance for the 
system to treatment waste water from Povo de Galega, which is located further upstream 
and is a key factor in eliminating pollution from the basin. 
• Waste 
In 1996 Portugal adopted a Strategic plan for solid urban waste, part-financed by the Cohesion 
Fund, which lays down priorities and defines the projects to be carried so that waste can be 
treated n Portugal in accordance with Community Directives. 
The investment submitted to the Cohesion Fund forms part of this plan. To carry out the 
measures planned, inter-municipal bodies, with the participation of a national body, have been 
set up to implement and manage the main projects. This solution should facilitate participation 
by the administrations concerned and provide the technical capacity required for the effective 
implementation of the projects. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 39 
Cohesion Fund commitments in this sector in J996 accounted for 34.5% of the resources 
available for environmental projects. Six decisions to grant assistance totalling ECU 195.5 
million were adopted; of this amount ECU 75.3 million was committed in 1996. 
0 In the Lisbon region, completion of the Inter-municipal network for the treatment of solid 
urban waste from the metropolitan area of Lisbon (Valorsul) is intended to provide an 
integrated solution to the problem of managing and using urban waste generated in northern 
greater Lisbon. Valorsul covers four municipalities - Amadora, Loures, Lisbon and Vila 
Franca de Xira - which have a total population of about 1 330 000 and each year generate 
over 550 000 tonnes of waste, 19% of the national total. In the circumstances, the 
construction of an incinerator to generate energy from the waste was the only 
environmentally correct solution. The incinerator has three lines, each of which can treat 28 
tonnes per hour. 
Valorsul also intends to organise the selective collection of waste - paper, cardboard, glass, 
scrap metal and plastic - as part of the integrated management of solid urban waste and to 
examine whether plants can be built to recycle glass and sort waste. The total investment 
planned amounts to ECU 193.9 million, of which the Cohesion Fund has financed ECU 96.9 
million. 
0 In the north, a project concerning a. factory to incinerate solid waste from greater Oporto 
(LIPOR) was financed. The plant will treat solid urban waste from seven municipalities 
associated with LIPOR and the waste from an existing composting unit. The seven 
municipalities taking part in LIPOR - Espinho, Gondomar, Maia, Oporto, Valongo, 
Matosinhos e Vila do Conde - have a population of one million and produced 390 000 
tonnes of solid waste in 1994. 
Existing treatment capacity is virtually exhausted so LIPOR has to find new means of 
securing a permanent and integrated solution to the problem of managing waste and turning 
the residue to good account. 
At the same time, LIPOR will launch selective collections and use recycling to reduce the 
volume of waste to be treated. The incinerator, to be managed and installed by the 
concessionaire for the lifetime of the investment, will be built under concession. The 
Cohesion Fund will contribute ECU 72.18 million to the investment of ECU 127.5 million. 
0 Also in 1996, the Cohesion Fund financed a project relating to the treatment network for 
solid urban waste on the south bank of the Tagus (LIMARSUL). The project forms part of 
the network for the treatment of solid urban waste on the south bank of the Tagus in the 
Lisbon area and includes eight municipalities. The LIMARSUL association comprises five 
of them: Alcochete, Barreiro, Moita, Montijo and Palmela. The project is intended to 
provide a rapid solution for the treatment and appropriate disposal of solid urban waste 
generated by almost 300 000 people. It should also permit the two existing tips to be closed 
under good conditions. Assistance granted totalled ECU 9.1 million. 
0 In southern Portugal, a series of studies and projects on the regional network for the 
selective collection, sorting and treatment of solid urban waste has been launched. The 
purpose of the series of studies is to prepare for the establishment of a network for the 
treatment of solid urban waste from the Algarve comprising the sub-networks of Barlavento 
and Sotavento. It will include facilities for selective collection and sorting as well as tipping. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 40 
The network for treatment of solid urban waste from Cascais, Sintra and Oeiras is another 
large project for the treatment of solid urban waste. The project should facilitate the 
selective collection and treatment of solid urban waste and forms part of an integrated plan 
for collection, treatment and final disposal. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 41 
PORTUGAL 
Solid Waste Management 
funded by the Cohesion Fund 
Porto 
Coimbra 
Lisboa 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 42 
PORTUGAL 
Dam and reservoir 
River training works 
funded by the . 
Cohesion Fund 
Porto 
Coimbra 
Lisboa 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
PORTUGAL 43 
Water Source 
Water Supply 
Water Treatment Projects 
funded by the Cohesion 
Fund 
Porto 
Coimbra 
Lisboa 
Annual repon of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 44 
PORTUGAL 
Sewerage Wastewater 
Treatment Projects funded by 
the Cohesion Fund 
Porto 
Coimbra 
Lisboa 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 45 
Transport 
During 1996, Cohesion Fund assistance for transport in Portugal continued to follow the 
guidelines defined earlier. 
However, there was a significant development in the Portuguese strategy concerning project No 
8 on list I adopted by the Essen European Council (Lisbon/Valladolid road route), the scope of 
which was extended. 
Following an initiative taken by the Portuguese authorities and the efforts made by the 
Portuguese and Spanish Governments, the Dublin European Council of 13 and 14 December 
endorsed the proposal that this project should become a multi-modal link between Portugal and 
Spain and the rest of Europe. 
This priority project should therefore be regarded as a multi-modal route capable of imposing a 
coherent and integrated structure on the various forms of transport used throughout the north­
west of the Iberian Peninsula, which is the only way of achieving a significant improvement in 
the overall efficiency of the system. 
This project includes two of the major corridors on the Peninsula - Portugal/Galicia and 
Portugal/Irun - and should provide rapid alternative links between Portugal two main areas of 
economic activity and the centre of the Union. Inside Portugal, this multi-modal link comprises 
a number of sub-projects concerning rail, road, sea and air transport. 
The rail aspect includes the Minho and North lines and the Beira Alta and Sud lines while the 
road section includes the main routes from Valença to Vila Real de S. Antonio (IP1), Torres 
Novas to Gardete (IP6), Gardete to Guarda (IP2) and Aveiro to Vilar Formoso (IP5). 
Sea transport will also be upgraded, mainly by improving land and sea access to the ports of 
Leixôes, Lisbon. Setubal and Sines, which constitute gateways for the road routes referred to 
above. 
The air component should integrate air links between the main urban centres into the system 
through works at the airports of Oporto and Faro and the construction of a new airport at 
Lisbon. 
The priorities selected by the Portuguese authorities are in line with the strategy pursued 
hitherto by the Cohesion Fund since they broadly follow with the strategic priorities and main 
guidelines for action followed by the Fund in previous years. 
Projects and commitments 
In 1996, the Portuguese authorities submitted for finance from the Cohesion Fund seven new 
applications for aid in the field of transport, involving assistance totalling ECU 461.9 million 
towards total investment of ECU 600.1 million. 
Annual report of the C lesion Fund 19vt 
CHAPTER 2 - Financial assistance committed and paid by the Fund 46 
The Commission adopted six transport projects in Portugal (four of which had been submitted 
in previous years). Total eligible investment was ECU 346.6 million and assistance totalled 
ECU 248.1 million, of which ECU 10.6 million would be met from the 1996 budget. 
Breakdown of new projects by sector 
Type of project 
Read 
Rail 
Ports 
Total Number 
2 
1 
3 
6 Assistance 
(ECU m) 
128.8 
104.9 
14.6 
248.1 % 
51.9% 
42.3% 
5.8% 
100% 
To this amount should be added the 1996 annual instalments for three projects adopted in 
previous years, which increases total commitments to ECU 221.5 million. The Tagus Bridge 
project alone accounts for 46.6% of the amounts committed this year for transport. 
Of the Cohesion Fund resources allocated to Portugal in 1996, 50.4% went to finance projects 
in the field of transport. 
Breakdown by sector of appropriations for 1996 
Type of project 
Road 
Rail 
Ports 
Total Commitments 1996 
(ECU m) 
167.1 
39.9 
14.5 
221.5 Number of projects 
5 
2 
10 % 
75.4% 
18% 
6.6% 
100% 
• Road network 
Efforts to speed up completion of main roads in Portugal forming part of the trans-European 
networks continued during 1996. 
In the case of the Valença/Vila Real de S. Antonio route, the Cohesion Fund adopted in 1996 
the project for the Braga Oeste/Ponte de Lima section for which the application for assistance 
was submitted right at the beginning of the year. Completion of this road route to the north, 
towards the Spanish frontier, which was planned for the end of 1998, now requires only 
construction of the Ponte de Lima/Valença section (the Portuguese authorities have undertaken 
to submit this for Cohesion Fund financing in 1997). 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 47 
Similarly, work on the Montemor/Estremoz section began in 1996, although the Commission 
has not yet received an application for finance. However, this section extends the 
Palmela/Marateca project (already completed and open to traffic) and the Marateca/Montemor 
project, both of which form part of the Lisbon-Madrid corridor. 
Apart from the two sections approved earlier between Alcanena and Abrantes with a total 
length of 41.7 km, no further Fund assistance is planned for the Torres Novas/Gardete (IP6) 
main road. The project adopted in 1993 (Alcanena/Atalaia) has now been completed and the 
file on it closed. The final report on the second section part-financed by the Fund 
(Atalaia/Abrantes), where work was completed in 1996, is awaited. 
The IP6 is one of the sections of the Lisbon/Valladolid road corridor and now includes the 
Portugal/Spain-Europe multimodal link. 
Of the sections where finance was granted to increase traffic capacity, the expansion of the 
sections of motorway between Alverca, Vila de Xira and Carregado and between Oporto and 
Aguas Santas, accounting for a total of 18.4 km of the Valença/Vila Real de S. Antonio route, 
was completed and the files closed. 
High priority continued to be given to relieving congestion in urban areas and so, after an 
increase in the assistance granted in 1995 to the CRIL, it was decided to provide more funding 
for the CREL, which will enable the Fund to contribute to all the works comprising the Lisbon 
outer ring road. 
Work on the new Tagus crossing in Lisbon continued at a steady pace in 1996. Problems which 
arose in connection with the implementation of measures to reduce the impact on the 
environment, for which provision was made in the decision granting assistance, resulted in the 
signature of a memorandum of understanding between the Commission and the Portuguese 
Government which included extension of the area of the Tagus estuary receiving special 
protection and improved national measures for monitoring the environmental impact of the 
project. 
• Rail 
During 1996 the work of the Cohesion Fund in this area continued to be guided by the priority 
strategic objective of renovating the main rail links with the rest of Europe. 
The strategic importance of the North and Beira Alta railway lines, which is demonstrated by 
the fact that the Portuguese authorities regard them as one of the key parts of the priority 
project to provide a multi-modal link between Portugal-Spain and the rest of Europe, fully 
justifies the Fund assistance approved in the past for projects forming part of the general 
programmes to modernise these two lines. 
From 1996, assistance from the Fund should be concentrated on projects on the North line to 
support the major effort to invest in infrastructure (almost ECU 865 million) which Portugal 
will make on this route between now and 2000. • 
An application for assistance submitted at the beginning of 1996 was approved at the end of 
last year and applications for complementary finance for that line should be forthcoming. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 48 
• Sea transport 
Ports play a fundamental role in the economy of Portugal. This role could be further increased 
by ensuring that they are interoperable with other modes of transport. The shifting onto the sea 
of some of the traffic currently travelling by land should have a beneficial effect on the 
environment. 
Cohesion Fund assistance has gone to investments likely to promote accessibility and links 
between the ports and other modes of transport and improve port services and infrastructure. 
While avoiding the creation of over-capacity in ports, it is important to concentrate efforts on 
those ports which have the best potential for this type of traffic and programme investment in a 
way which takes account of likely changes in demand. 
In 1995 the Commission undertook a study which analysed the investment, whether proposed 
or being prepared, in the four main ports of Portugal. As a result of that study, technical 
discussions were held on the various possible scenarios for those ports and the problems of 
competition and coordination between them. The projects adopted in 1996 concern the ports of 
Leixôes, Lisbon and Setûbal. 
0 In the Port of Leixôes, the Cohesion Fund financed the second stage of work on 
restructuring and modernisation. 
Leixôes. which is the main port for northerp Portugal and so handles a large part of the 
traffic generated by economic activities in the Oporto area, operates with a degree of 
efficiency but its container terminals need to be expanded to avoid congestion. 
The decision adopted in 1996 (total cost of the project ECU 17.2 million, Cohesion Fund 
assistance ECU 7.0 million) relates to investment for a number of purposes: completion of 
two container terminals and measures to increase safety in the port and protect the 
environment, mainly through the purchase of equipment to combat oil pollution. 
0 The Cohesion Fund also provided ECU 6.5 million to finance work on the restructuring of 
the Roche de Conde de Obidos and Alcântara-Norte quays in the port de Lisbon. This 
restructuring is intended to solve problems caused by erosion and provide new 
infrastructure. The main aim of the project is to construct a mooring to meet the present 
requirements of the passenger terminal and so deal better with the growth in cruise traffic. 
Other planning projects to make operations in the port of Lisbon more efficient are currently 
being considered. 
0 A decision on the system to control and manage sea traffic (VTS) in the port of Setûbal was 
approved in 1996. It involves the construction of a tower and the purchase of equipment to 
provide services to sea traffic in this port. The project is an integral part of investment under 
the programme for the modernisation and expansion of the port of Setûbal to which the 
Structural Funds have already provided some ECU 21.3 million in assistance. 
The port of Setûbal has very considerable medium and long-term potential, particularly 
when the new Tagus Bridge comes into service in 1998. This development should be 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 49 
regarded as closely connected with the developments planned in Lisbon since the two ports 
serve the same economic area. 
A study has shown that, if all the projects submitted by Portugal were approved, they would 
result in overcapacity so a choice had to be made. Supplementary projects for 
Lisbon/Setubal can be approved only as part of an overall solution. Discussions on this point 
are continuing. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 50 
PORTUGAL 
Trans-European 
Road network 
Cohesion Fund Porto 
Coimbra 
Lisboa 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 51 
PORTUGAL 
Trans-European 
Rail Network 
Cohesion Fund 
Porto 
Coimbra 
Lisboa 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 52 
2.3.3 GREECE 
Total assistance granted to projects approved for Greece in 1996 amounted to ECU 438 295 
646. Financial commitments for environmental projects totalled ECU 235 854 036, or 53.8% of 
the assistance granted to projects in Greece in 1996. Financial commitments for projects in the 
transport sector totalled ECU 204 441 610, or 46.2% of the total assistance granted to Greece. 
The table below gives the breakdown by field and sector of assistance: 
TABLE OF COMMITMENTS OF ASSISTANCE FOR PROJECTS IN GREECE (1996) 
Environment Assistance (ECU) % of total 
T Water supply 70 839 413 30Ô 
2. Waste water and treatment " 164 004 093 ~ 69.5 
3. Protection of the 1010 530 0.5 
environment 
Total 1 235 854 036 53^8 
Transport Assistance (ECU) % of total 
T Roads 124 070 006 6ÏÏ3 
__ __ 62 720 007 3LÔ 
__ Ajrports 15 651 597 ! 7?7 
Total 2 202 441 610 46^2 
Totalis 438255*46 18Ô 
Environment 
Since the aim of the Cohesion Fund is to promote economic and social cohesion, it has 
provided assistance to improve infrastructure, provide infrastructure which is missing and 
protect nature. 
Work on the environment has been in line with the objectives of the Fifth Programme on the 
Environment and Sustainable Development and forms part of a general and coherent strategy 
on the environment. 
The first objective concerns the management of water resources. It is vital to ensure that 
enough water is available, that water resources are well managed, that drinking water is of 
adequate quality and that supplies of drinking water match demand. 
The second objective is to provide the country with infrastructure for the treatment of waste 
water and to help it comply with its obligations under the relevant Directives. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 53 
The third aim is manage waste in accordance with the Community strategy for 2000. 
The greatest lack is in the infrastructure for dealing with waste. 
The Cohesion Fund has provided assistance for waste water in all regions of Greece on the 
basis of the following principles: 
0 the adoption of projects which are as complete as possible, operational and form part of a 
coherent overall integrated strategy adapted to the economic and social development of each 
region; 
0 the protection of the environment, since the projects adopted as a priority are principally 
those where the beneficiary town is near to a sensitive area or has a population equivalent to 
over 15 000 people. The Community calendar also imposes certain immediate priorities 
(1998-2000). 
The Cohesion Fund is concerned that the resources of drinking water available should be well 
managed. 
In addition to the shortage of infrastructure, the mechanism for monitoring and checking the 
application of environmental policy needs to be improved. 
As has been noted. Cohesion Fund assistance to Greece for the environment accounted in 1996 
for 53.8% of Community assistance to Greece. The breakdown of assistance by objective is as 
follows: 
- water supply: financial commitments totalling ECU 70 839 413, or 30%;6 
- treatment of waste water: financial commitments totalling ECU 164 004 093, or 69.5%; 
- nature protection: financial commitments totalling ECU 1010 530, or 0.5%. 
Two major projects were approved in 1995 on a multi-annual basis. The first concerns water 
supplies to Thessaloniki from the River Aliakmon, the other the second stage of the biological 
treatment of water in Thessaloniki. 
In 1996, a number of medium-sized and small projects were approved, also on a multi-annual 
basis. They included the disposal of waste water and a biological treatment station at Volos; the 
water and drainage system in Alexandroupolis; water supply and waste-water disposal at 
Larissa; the waste-water drainage system at Rhodes; completion of the drainage grid in Larissa 
and completion of the treatment station at Markopoulo and of the waste-water drainage systems 
at Kalyvia. Kouvara and Markopoulo. 
The projects approved include work on the construction of networks, water supply, the disposal 
of waste water and the biological treatment station in each region selected. 
Projects for the disposal of waste water were adopted on condition that biological treatment 
stations already existed, or, if they were being built, finance was guaranteed. Biological 
treatment stations were financed provided that systems for the disposal of waste water existed 
and so contributed to the proper operation of the stations financed by Community funds. 
6 This percentage includes a small part of the funding for water supplies in Thessaloniki corresponding 
to forecast implementation in 1996. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 54 
The prospects for the creation of jobs, both during implementation of the project and during its 
operation, was a factor taken into account when they were adopted. 
• Water supply 
Cohesion Fund assistance for drinking water was mainly concerned with solving problems of 
quality and quantity. 
This category of projects includes one major project, the one to supply water to Thessaloniki 
from the River Aliakmon, further work on the Evinos major project to supply water to Athens 
and improvements to the Momos aqueduct which goes with the Evinos major project. 
In the case of the project to supply water to Athens, the Cohesion Fund has paid attention to the 
sound management of water resources and improvements to the pipes supplying water to the 
capital. The Evinos/Mornos tunnel has been used to supply water to Athens since summer 
1995. The Cohesion Fund has also approved studies and measures to stabilise earth 
movements. 
In the case of the major project to supply waster to Thessaloniki, the Fund was concerned to 
ensure sound management of water resources, monitoring of existing facilities and an 
obligation to complete the networks required. 
It is also monitoring closely the project to establish a bank of hydrological and meteorological 
data which help meet requirements relating to the sound management of the country's water 
resources. 
The Cohesion Fund has continued its integrated approach to water supply to other Greek cities 
by financing projects intended to solve the problems of water supply and disposal, particularly 
in Rethymno, Naoussa, Larissa, "Nafplion, Chalkida, Fiorina, Lamia and Katerini. 
* Treatment of waste water 
A large number of projects concerned with the treatment of waste water and the treatment of 
effluent, mainly from urban areas, were part-financed in a number of large and medium-sized 
regional towns. 
These projects include the second stage of the major project for the biological treatment of 
waste water in Thessaloniki. This project is of the utmost importance for water quality in the 
Gulf of Thessaloniki and will serve the second largest city in Greece. With regard to water 
quality in the Gulf of Thessaloniki, the Cohesion Fund approved a project for the biological 
treatment of waste water in the tourist area of Thessaloniki, whose treated effluent is also 
discharged into the Gulf. This work, together with the Kalochori drainage project, constitutes a 
series of measures to improve the environment in the region. 
The Cohesion Fund also helped part-finance the second stages of two-stage projects. Those for 
which part-financing is now in place include: 
* Kalamata. Argos. Pylos, Nafplion and Sparti in the Péloponnèse; 
* Rethymno and Chania in Crete; 
* Chios and Mythilini in the Aegean Sea; 
* Komotini. Orestiada and Alexandroupolis in Thrace; 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 55 
* Ioannina and Arta in Ipiros; 
* Chalkida on the island of Evia; 
* Volos, Larissa, Kalambaka-Meteora and Trikala in Thessalia; 
* Katerini, Kolyndros, Serres, Fiorina, Kria Vrissi in Macedonia, and 
* Villia, Lavrio. Markopoulo, Kalivia and Kouvara in Attica. 
The Cohesion Fund continued to monitor projects approved in 1995, including the construction 
of biological treatment stations in certain large cities: Agrinio, Yiannitsa, Pyrgos, Thiva and 
Naoussa. 
All finance was based on complete applications and a thorough study was carried out on each 
project. The projects were subjected to prior appraisal and on-going assessments. 
* Waste management 
Waste management has not aroused the interest the Commission hoped. The projects submitted 
to the Cohesion Fund by the Greek authorities are few in number and involve mainly cleaning 
up and the provision of tips at Schisto, Liossia, Zante, Thessaloniki and Patras. The Cohesion 
Fund cannot approve the projects in Thessaloniki, Schisto and Liossia until the competent 
authorities incorporate the results of the expert studies carried out by the Fund into their 
specifications, the environmental impact procedure is completed and a plan for waste in the 
regions concerned is officially notified to the Commission. 
The Cohesion Fund, in cooperation with the Greek authorities, hopes to extend and diversify 
measures in this field in accordance with the Community strategy so that it can become eligible 
for Fund finance. 
A study on a pilot project on an integrated solution for the islands of Santorini and Thirassia 
began in 1996. 
A study on a pilot project on the disposal of solid urban waste on the islands of Egine, 
Mykonos and Tinos has recently been completed. It advocates the use of modern technology, 
thermolysis. Discussions with the Greek authorities to decide what should be done next have 
begun. 
* Nature protection 
During this period, the Cohesion Fund supplemented its assistance through research and 
information on the environment. This included approval of supplementary work on cleaning up 
the river and its banks and protection of the site at Krya Livadia. 
A number of projects to combat forest fires and water pollution were also continued. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 56 
GREECE 
Big Projects ——• 
^ Wastewater Proj ects 
financed by the 
Cohesion Fund 
Water Supply Projects 
Corfu 
hios 
Rhodos 
Kriti 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 57 
Transport 
The transport strategy for Greece followed by the Cohesion Fund comprises: 
0 completion of the country's two main road routes, the Via Egnatia and the Pathe (Patras-
Athens-Thessaloniki-Evzoni) motorway; 
0 completion of the rail network: 
* by constructing the railway station complex at Thriassio where a group of converging 
sidings will be built to shunt trucks and a line built to connect the complex with existing 
track. There will be provision for a future link with the Port of Piraeus; 
* by constructing a line to link Thriassio station to the city of Corinth; 
0 construction of a major international airport for Athens at Spata and modernisation of air 
traffic: 
0 continuing development of the combined transport strategy through investment in three 
major Greek ports, Igoumenitsa, Iraklion and Pireaus, together with the Thriassio rail 
complex. 
The success of this strategy depends on the mobilisation of funds from the private sector, which 
will benefit from the future revenue generated by these investments. 
The calculation of assistance to the major rail projects and the project to build the new Athens 
airport at Spata. 
The projects and the corresponding amount of assistance committed in 1996 are shown in the 
table below. The breakdown of assistance by sector is as follows: 
0 roads: financial commitments for ECU 124 070 006, or 61.3%, 
0 airports: financial commitments for ECU 15 651 597, or 7.7%, 
0 rail: financial commitments for ECU 62 720 007, or 31%. 
• Roads 
The strategy followed by the Cohesion Fund defined the following priorities for 1996: 
0 the Pathe motorway: 
Construction work on the Pathe motorway is progressing and ten projects costing a total of 
ECU 270 million were adopted by the Commission at the end of the year in a single 
commitment. 
The Project Managers for the Pathe motorway have been appointed, Mott McDonald - Louis 
Berger for the northern part and Sogelerg - Lamayer for the southern part. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 58 
The problem of the large discounts has been overcome by intensive work on the reform of 
public contracts and the decision of the Cohesion Fund to adjust financing for the projects in 
line with the prices agreed. 
The problem of the increase in the initial cost has also been overcome as a result of the drafting 
by the Greek authorities of a circular permitting rigorous management of the cost of each 
contract. 
0 The agency for Egnatia began to operate this year and has rented offices in Thessaloniki and 
organised the three regional departments, at Ioannina, Kozani and Komotini. It has hired a 
staff of almost 120, 30 for the Project Manager and 90 for the Agency itself. The Project 
Manager's staff form part of the Agency's organisation chart and have received delegated 
authority, in accordance with Annex VII to the decisions in question, following repeated 
requests from the Cohesion Fund. The international competition has been completed and 
three "Construction Managers" have been appointed. They will begin work in the new year. 
However, no projects were submitted in 1996. 
• Railways 
The multi-annual projects adopted in 1996 are: 
0 the Thriassio railway station, where a group of converging sidings will built to shunt trucks 
and a line built to connect the complex with existing track, so making provision for 
combined transport; 
0 construction of the line linking Thriassio station to the city of Corinth. 
• Airports 
In the airport sector, the largest transport infrastructure project in Greece, the New Athens 
International Airport at Spata, was adopted in 1996. This airport is an example of how a major 
project can be financed from a number of sources, both public and private. It was financed by a 
grant from the Cohesion Fund, an EIB loan and public and private capital. The total cost of the 
airport is ECU 2 150 million. The Community will contribute ECU 250 million from the 
Cohesion Fund and the EIB will provide over ECU 1 000 million. The commitment for 1996 is 
ECU 15.6 million. This project, which forms part of the trans-European networks, will have a 
major impact on air transport within Europe, within Greece and with non-member countries. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 59 
GREECE 
Trans-European 
Road network 
Cohesion Fund 
Igoumenitsa 
Patra Alexan­
droupolis 
AthEna 
Annual ;nort of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 60 
GREECE 
Trans-European 
Rail network 
Cohesion Fund 
i Igoumenitsa Alexan­
droupolis 
Athina 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 61 
2.3.4 IRELAND 
In 1996, the Cohesion Fund granted ECU 221.7 million in assistance to Ireland, of which ECU 
1 19.8 million (54% of the total budget) was for transport projects and ECU 101.9 million (46% 
of the total) was for environment projects. 
The table below gives a breakdown by category of the projects assisted : 
COMMITMENTS OF AID TO PROJECTS IN IRELAND (1996) 
Environment Assistance granted % of total 
(ECU million) 
1. Water treatment 52.7 23.8 
2. Water supply 45.9 20.7 
3. Habitat 1.3 0.6 
4. Vessel Traffic System (half) 2.0 0.9 
Totall 101.9 46 
Transport Assistance granted % of total 
(ECU million) 
1. Roads 100.9 45.5 
2. Rail 8.4 3.8 
3. Ports 8.5 3.8 
4. Vessel Traffic System (half) 2.0 0.9 
Total 2 119.8 54 
Total 1+2 221.7 100 
General Strategy 
The priorities for assistance in 1996 remained the same as in the previous years. In transport, the 
largest part of the budget continued to go to road projects forming part of the trans-European 
network with two important major projects, the Kildare Bypass on the Dublin-Cork/Limerick 
route and the Dunleer-Dundalk section of the Dublin-Belfast route, being added to the list of 
major projects being assisted by means of annual instalments of aid. 
In the rail sector, it was decided to assist the most economically advantageous parts of a number 
of railway lines on the trans-European Network. These are the Dublin-Galway, Dublin-Sligo, 
Dublin-Waterford and Mallow-Tralee lines. (Major investment in the Dublin-Cork and Dublin-
Belfast lines had been committed in earlier years). The extension of the DART electrified outer 
suburban line in Dublin was also approved. 
As before, assistance to ports remained in line with the policy of concentrating on the four largest 
ports of Dublin, Cork, Rosslare and Waterford. A maritime control system for these four ports 
Annual report of the C aesion Fund 
CHAPTER 2 - Financial assistance committed and paid by the Fund 62 
plus the Shannon estuary was also approved. The aid granted to these latter projects is shown in 
the table above, divided between the transport and environment sectors to reflect the importance 
of improved maritime safety for protecting vulnerable coasts and estuaries from possible pollution 
caused by maritime accidents. 
Within the environment sector, the main priorities continued to be waste water treatment and 
upgrading drinking water supplies. Waste water treatment projects within the largest urban areas 
and in environmentally sensitive areas which are required by Community Directives to be 
completed not later than the end of the decade were once again the priorities for assistance. The 
Commission continued to target for assistance groups of related water treatment projects in lake 
and river catchments with the aim of maximising the impact of the aid granted on the 
environmental protection of these areas. The projects assisted are in the Lough Derg and Lough 
Ree lake areas and the River Suir and River Liffey basins. Assistance to water supply projects 
continued to be concentrated on large urban areas and areas where drinking water quality is 
particularly poor. One important innovation in 1996, arising from consideration of studies by 
consultants, was the emphasis on water conservation which, in Irish conditions, is frequently more 
cost-effective than the construction of new primary infrastructure. This emphasis on making better 
use of existing water sources and distribution systems will be a key feature of policy in 1997 and 
later years. 
Environment 
• Waste-water treatment 
A total of eight new projects were approved in 1996. Together with amounts committed to modify 
projects already approved in earlier years, a total of ECU 52.7 million was committed to this 
sector. The projects assisted were the following : 
Project Name New project or stage or modification of existing Aid granted 
project (in 1996 
ECU million) 
Clonmel (Stage 11) Annual instalment to new project 5.9 
Killarney New project 7.1 
Wexford Annual instalment to continuing project 0.1 
Dublin (Stage 11) Annual instalment to continuing project 6.3 
Dundalk Annual instalment to new project 0.5 
Drogheda Annual instalment to new project 6.5 
Limerick New project 7.2 
Lough Ree Annual instalment to new group of projects 1.9 
River Liffey New group of projects: planning stage 3.0 
River Suir Annual instalment to new group of projects 6.3 
Lough Derg Modification of existing group of projects 7.8 
TOTAL 52.7 
Annual report of the Cohesion Fund 19% 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
• Water supply projects 
The following projects received ECU 45.9 million in assistance: 
Project name New project or stage or modification of existing Aid granted in 
project 1996 
^^^^^^^^^^^^^^ (ECU million) 
Lough Mask (Stage II) Annual instalment to continuing project 4.8 
Tuam (Stage II) New second stage with annual instalments 18.7 
Lough Gill (Sligo and environs) New project 12.0 
Roscrea/Nenagh New project 7.8 
Dublin Water Conservation New project with annual instalments of aid 2.7 
TOTAL 46.00 
• Habitat protection 
An additional ECU 1.3 million was granted to continue preservation and monitoring work 
intended to conserve the best remaining example of the Raised Bog wetland habitat in the 
midlands of Ireland. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 64 
IRELAND 
Water Treatment Projects 
Rosslare 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 65 
IRELAND 
Water Supply Projects 
Rosslare 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 66 
Transport 
• Roads 
In 1996, ECU 100.9 million was committed to new road projects or to modifications of projects 
approved in previous years. All of the projects approved or modified received 85% of the total 
cost in aid. 
The table below shows the projects to which aid was committed in 1996. The word "project" 
refers to a new project where all of the aid was committed from the 1996 budget. "Annual 
instalment" identifies large projects where aid is committed each year in annual amounts while 
"modification" indicates the addition of funds from the 1996 budget to projects previously 
approved by the Commission. 
ROADS 
NI Dublin-Belfast 
Dublin Ring Road 
Nl I Dublin-Rosslare 
N7 Dublin-
Cork/Limerick 
N4 Dublin - Sligo 
N18 Limerick - Galway 
N25 Rosslare-Cork 
TOTAL PROJECT NAME 
Balbriggan By-pass 
Cloghran-Lissenhall 
Dublin Port Access Road 
Dunleer-Dundalk 
South-East Motorway 
Southern Cross 
Kilmacanogue-GIen of Downs 
Arklow By-pass 
Kildare By-pass 
Portlaoise By-pass 
Rathcoole interchange 
Curlews By-pass 
Collooney-Sligo 
Limerick Inner Relief Road 
Newmarket By-pass 
Dunkettle Bypass 
Barntown-New Ross PROJECT OR 
STAGE 
Annual instalment 
Modification 
Modification 
Annual instalment 
Modification 
Annual instalment 
Annual instalment 
Annual instalment 
Annual instalment 
Annual instalment 
Project 
Annual instalment 
Annual instalment 
Project 
Modification 
Project 
Project AID GRANTED 
FROM 1996 
BUDGET (ECU 
million) 
4.5 
1.4 
2.7 
4.3 
1.8 
5.1 
1.7 
3.6 
1.1 
9.1 
9.8 
7.0 
6.5 
11.1 
0.2 
23.2 
7.9 
100.9 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 67 
Rail 
The projects assisted in 1996 were the following: 
NAME TYPE OF PROJECT ASSISTANCE 
GRANTED 
(ECU Million) 
Dublin - Galway First annual instalment for track and 5.2 
Dublin -Waterford signalling upgrading on parts of the TEN 
Dublin-Sligo rail network 
Mallow-Tralee 
Network Signalling 
DART extensions Extension of Dublin outer suburban 3.2 
electrified line 
TOTAL 8.4 
Ports 
The following projects were assisted in 1996: 
PORT 
Dublin 
Waterford 
Cork 
VTS 
TOTAL TYPE OF PROJECT 
Dredging at Lo-Lo 
container terminal and 
additional equipment 
New berth at Belview 
Dredging of approach 
channel 
Improvement of Lo-Lo 
container terminal 
Vessel traffic control 
system at Dublin, Cork, 
Rosslare and Waterford 
ports and Shannon 
estuary PROJECT OR STAGE 
Project 
Project 
Modification to 
complete project 
Project 
Group of projects ASSISTANCE 
GRANTED 
(ECU million) 
1.7 
3.4 
0.1 
3.3 
4.0 
12.5 
Annual report of the Cohesion \7U\K\ 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 68 
IRELAND 
Trans-European 
Road network 
Cohesion 
Rosslare 
Annual report of ihc Cohesion VuuA !°<>o 
CHAPTER 2 - Financial assistance committed and paid by the Fund 69 
IRELAND 
Trans-European 
Rail network 
Cohesion Fund 
Rosslare 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 70 
2.3.5 MOST REMOTE REGIONS 
The Cohesion Fund attached particular importance to financing projects in the regions of the 
Cohesion countries regarded as most remote. In the case of Spain, these are the Canary Islands 
and in that of Portugal Madeira and the Azores. 
Portugal applied for Cohesion Fund finance only for projects on Madeira, where the Fund has 
already contributed substantially and will do so to a still greater extent in the future. In the 
Azores, projects are financed by other instruments. 
The Cohesion Fund is very active in financing projects in these regions and pays particular 
attention to the environment. In the field of transport, the objective of better access to the 
remotest regions from the central regions was expressly mentioned in Article 2(2)(g) of the 
Community guidelines for the development of the trans-European networks of 23 July 1996. 
Canary Islands 
• Environment 
Nature on the Canary Islands is extremely rich, including some unique and very fragile habitats 
and over 600 vascular plants in a limited area which is home to some 1 500 000 people. They 
also receive some 10 million tourists per year. The impact of socio-economic development has 
caused damage to some habitats and very fragile species and a number of sites. 
The Canary Islands contain four National Parks: the Canal Reserve, Los Tiles on the island of 
Las Palmas and the island of Lanzarote (both of which have been declared Biosphere reserves) 
and the Garajonay National Park, which has been declared Heritage of Humanity. 
Against this background, the region of the Canary Islands devised an environmental Plan for 
1994-99 to define its priorities and action to be taken. The Plan includes the following 
programmes: territorial planning, quality of the environment, planning of natural areas, 
environmental education and information and a supporting legislative programme. 
The projects comprising the Plan have been financed mainly by the cohesion financial 
instrument and the Cohesion Fund since 1993. The sectors principally involved are water 
supply, waste management, the restoration of the coast line and afforestation. 
0 Water supply 
- 96/11/61/004: Water supply works: desalination plants in the Canary Islands. Assistance: 
ECU 27 266 911. 
This a group of four projects, three of which are concerned with the construction and extension 
of plants for the desalination of sea water: at Santa Cruz de Tenerife; Arrecife ("Lanzarote 111"' 
third line) and "Lanzarote Ilf fourth line, while the fourth concerns construction of a head 
reservoir to supply Santa Cruz de Tenerife. The main aims are to secure supplies of drinking 
water (30 000 mVday) to 325 000 people who are suffering from drought and its effects; to 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 71 
construct a reliable water supply system comprising 5 552 m of piping, a number of pumping 
stations, reservoirs and auxiliary plant; to improve urban supplies; to improve water quality; to 
improve sanitary conditions and the quality of life of the people concerned; to increase the 
amount of water available through savings in use and to improve the management and use of 
water. 
- 94/11/61/014: Stations for the'production of drinking water 
* Tenerife: Adeje-Arona. Assistance ECU 5 892 000. The project includes provision of a plant 
for the desalination of sea water using the reverse osmosis process at Granadilla de Aborna. 
* Gran Canaria: 
. Las Palmas. Assistance ECU 6 982 926. The project involves construction of a reservoir 
with a capacity of 250 000 m near the desalination plant. 
. Galda-Agaete. Assistance ECU 3 824 520. The project provides for the installation of two 
lines, each capable of desalinating 1 500 m of water. 
The main aims of the project are to supply high-quality drinking water to a population of 
865 000; to construct infrastructure which will ensure water supplies and the durable growth of 
the region; to improve water quality, sanitary conditions and the quality of life of the people 
concerned; to preserve underground water supplies by reducing the over-exploitation of ground 
water; to promote the sustainable development of the regions concerned, particularly in 
tourism, and to increase the amount of water available through measures to save water and 
coordinate its use. 
0 Coastal improvements 
- 96/11/61/015-017: Coastal improvements 1996. 
* Beach at Monis-Icad de Los Vinos (Tenerife). Assistance: ECU 2 316 748. 
* Beach at Los Pocillos and Matagorda-Tias, (Lanzarote). Assistance: ECU 5 854 024. 
* Improvements to the sea-shore between El Fraile and Las Arenas at Buenavista del Norte-
(Tenerife). Assistance: ECU 1 256 831. 
A group of 14 broken down into three categories: 
- Reclamation and regeneration of beaches: three measures to counter the erosion of beaches 
caused by the greenhouse effect, the consequent increase in sea level and the change in the 
direction of currents. 
- Coastal improvements: ten measures to restore the natural beauty of the area by reducing 
human pressure on the coastline and improving the environment. 
- Environmental reclamation of the coastline: a measure to protect and conserve areas of great 
environmental value and natural beauty, returning them to their original natural state. 
-95/11/61/003: Coastal improvements 1995. 
Beach at Las Canteras - Las Palmas de Gran Canaria. Assistance: ECU 10 472 946. 
The main aims of the projects are: 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 72 
* to facilitate pedestrian use of 4.9 km of seafront; 
* rational utilisation of the beach through construction of 1 677 deterrent parking places and 
8.705 m of walkways; 
* restoration of 1.9 km of beach; 
* to improve access to beaches to protect sensitive areas; 
* to improve the coastal environment by planting indigenous vegetation. 
- 94/11/61/028: Coastal recovery project. Charco de Los Clicos. Restoration of run-down areas 
of the Spanish coastline. Assistance: ECU 460 438. 
Restoration of the Clicos-Yaiza lake (Lanzarote). 
Measures planned to restore the coast and lagoon complex: tipping of sand along 30 m of 
beach; closure of the tombolo area by a rock break-water to avoid the beach being submerged; 
construction of a 55 m underwater dyke in the tombolo area; construction of a partly 
submerged dyke to act as a breakwater. 
0 Afforestation 
- 95/11/61/010-2: Afforestation and combating erosion. Assistance: ECU 4 213 000 
The project comprises two categories of measures in woodlands: 
The first is intended to halt erosion and desertification, which is directly affecting the natural 
environment of the water system of the Canary Islands by damaging three of its basic 
resources: vegetation, soil and water. 
The individual measures to be taken to this end are: 
* biological action to improve plant cover in order to protect the soil: 
=> reafforestation with species suited to the environment; 
=> forestry operations to preserve and improve existing stands in order to maintain the balance 
between soil protection and the progression of vegetation; 
* corrective infrastructures: stabilisation of slopes and river beds in order to prevent recurrent 
Hooding, by means of small-scale one-off hydro-technical operations. 
The second category concerns the regeneration of woodlands damaged by fire. It includes 
biological action designed to encourage natural regeneration and establish protective plant 
cover: 
* intensifying reafforestation and regeneration of woodland; 
* stepping up forestry operations in existing stands to prevent forest fires. 
* creating firebreaks and safety strips in high-risk areas or where plant cover is particularly 
dense 
- 93/11/61/012-023: including erosion control in badly affected areas of the Canary Islands and 
protection of natural resources, which are essential for the environment. Assistance: ECU 
827 270. 
Annual report of (he Cohesion l'niul 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 73 
0 Improvements to national parks 
The main aims of the following group of projects are: to meet demand for public use of the 
National Parks and minimise the negative impact of visitors. The projects include a number of 
improvements to infrastructure in the service areas and access to the parks. 
- 93/11/61/031-039: Caldera de Taburiente Natural Park. Assistance: ECU 1 441 800 
Garajonay Natural Park. Assistance: ECU 514 500 
Teide Natural Park. Assistance: ECU 1 189 900 
Timanfaya Natural Park. Assistance: ECU 1 045 200 
0 Waste 
- 95/11/61/042: Facilities to treat special waste, ECU 11 379 780. 
El Hierro, La Palma, La Gomera, Tenerife, Gran Canaria, Fuerteventura and Lanzarote. 
The construction of selective collection centres will facilitate the removal from the normal flow 
of solid urban waste for disposal of special, toxic and dangerous waste from urban areas and 
small industries. This measure will also permit the recovery and recycling of materials hitherto 
disposed of with other urban waste and eliminate small-scale fly-tipping. 
Each collection centre will have a covered hangar to store refrigerators, batteries and other 
waste which has to be kept indoors, a series of large containers (30 to 34 mJ) for metal, wood, 
paper, cardboard and building rubble and smaller containers for glass, batteries, oil and tins. 
The plan under this project is to establish three types of collection centres differing in size and 
structure depending on the number of users. 
0 Treatment station 
- 94/11/61/015: Treatment stations for waste water at Adeje-Arona (Tenerife). Assistance: ECU 
13 780 563 
The main aim of this project is to upgrade the drainage system to reduce the level of pollution 
in the waste water from the municipalities of Adeje and Arona (population concerned: 95 000) 
and permit reuse of the treated water, amounting to 1 1 680 000 irfVyear. After treatment, the 
levels of contaminants will meet the requirements of Directive 91/271/EEC. The works to be 
carried out include the installation of collectors and outlet facilities, the construction of 
pumping stations, the provision of a channel to the underwater discharge and the installation of 
systems to treat the run-off water. 
0 Environmental restoration 
- 94/11/61/025 : Installation of a radar on Gran Canaria 
Climate monitoring, detection of variations in climate and their impact in the environment. 
Annual report of the Cohesion \\\n(\ 1906 
CHAPTER 2 - Financial assistance committed and paid by the Fund 74 
The project has two objectives: 
* the collection, treatment and storage of data on the climate system; 
* the use of these data in studies on the meteorological phenomena underlying natural 
catastrophes, variations and changes in climate, climate modelling and the consequences for 
human activities and natural resources. 
• Transport 
- 93/11/65/031: The Hierro airport 
The project concerns construction of a new roadway parallel to the existing roadways to 
provide access to the apron nearest to pier 16 and a car park at the entrance to the airport, near 
to the power plant. 
The aim of the project is to improve air communications between the Spanish islands and the 
centre of the Community. 
- 93/11/65/032: The Tenerife Norte airport. 
Resurfacing of the aprons at piers 12 and 20, the holding areas and the runway. 
About 100 m" of the concrete surface of the runways is cracked and has to be removed and 
replaced. 
The cracked parts of the waiting areas also have to be dug out and repaired. Puddles form along 
1 100 m of the centre of the runway because it is too uneven. It needs to be levelled and 
recovered by an extra layer of hot-rolled asphalt across the whole width. 
The main aims of the project are to improve the runway to increase safety during landing, take­
off and taxiing. 
- 96/11/65/001: Road: Gran Canaria - Olla de La Plata. Assistance: ECU 15 535 089. 
The project is designed to provide a route to solve the problems on GC1 - the busiest road on 
the island - while taking account of the development of the beach at Laja and urban 
development in the south of Las Palmas. A 4 km long section of the CGI will be widened to 
two three-lane carriageways each 3.5 m wide with inside shoulders of 1 m and outside 
shoulders of 2.5 m. 
The secondary objectives of the project are to improve traffic flow; reduce dangers to vehicle 
and pedestrian users; improve the appearance of the entry to the town and apply the general 
system governing urban planning in the area. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 75 
Madeira 
In addition to the water supply project for Madeira already approved, the national and regional 
authorities have begun in-depth discussions with the Cohesion Fund on other possible works: in 
the transport field, with particular reference to the extension over the sea of runway of Funchal 
airport, which has already received finance under Regis; and in that of the environment, where 
the Cohesion Fund could contribute to a general project to rationalise the waste treatment 
system, based on a new incinerator for urban waste. 
• Environment 
0 Water supply 
- 94/10/61/014 - Group of stages of projects to connect the main sources of drinking water on 
Madeira. Assistance: ECU 18 215 502. 
The main features of this project are the construction of pumping and treatment stations and the 
laying of pipes to connect them, to make the management of water resources more efficient. 
The project will have a favourable impact on the environment since it will permit the 
development of under-used water resources and improve water management. 
2.4 ASSISTANCE FOR STUDIES AND TECHNICAL SUPPORT MEASURES 
2.4.1 GENERAL 
To carry out its management duties successfully and make the assistance granted more 
effective, the Cohesion Fund Directorate seeks the assistance of a number of experts and 
consultants in the various sectors to which it provides assistance. 
Consultants play a very important role in assessing, analysing and monitoring the projects 
submitted for part-financing in the various sectors to which the Fund provides assistance. 
Experts supplement the Commission's technical expertise with their practical and up-to-date 
knowledge of a variety of subjects and so help it meet its obligations better. 
As in previous years, contacts with the EIB continued during 1996, principally with regard to 
evaluation of the largest projects. More details on the Bank's important role may be found in 
Chapter 4.8 of this Report. 
A number of studies were undertaken to guide the selection of the projects to be financed by 
the Fund: studies on the availability of water in the international River Guadiana 
(Spain/Portugal) and the estuaries prior to a decision on possible finance for a dam on this 
river; an feasibility study on a thermolysis plant to solve the problems of waste on the Greek 
islands (Mykonos. Aegina, Tinos); a study on the feasibility and location of a number of multi-
Annual report of the Cohesion \\md 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 76 
modal <Toods centres in Greece and a study on coordinated environmental measures on a Greek 
island (Santorini). 
The study by the London School of Economics on the socio-economic impact of the Cohesion 
Fund on the regions was completed during 1996 with the construction of three models, which 
were tested with quite interesting results, on the effect of the Fund's investment on local 
economies. Following these positive results, the Fund enlisted the help of the London School of 
Economics in applying more systematically developed models to projects in progress or to be 
financed in the future. 
2.4.2 AT THE INITIATIVE OF THE COMMISSION 
Invitations to tender 
During 1996, the Cohesion Fund issued a number of invitations to tender relating to studies and 
technical assistance. Both the invitations and the award of contracts complied with the rules on 
public procurement. The various consultants selected came from a number of Member States, 
most of them from countries other than those eligible under the Cohesion Fund. 
The share of the total budget allocated to technical assistance and studies undertaken at the 
initiative of the Commission was greater than in 1995, but is still comparatively small. The 
total amount committed for this purpose was ECU 2.2 million, less than 0.1% of the resources 
committed by the Fund. 
Since a number of contracts with outside consultants expired in 1996, the Fund Directorate 
decided to issue two major invitations for multiple framework contracts for technical 
assistance; these'were published in the Official Journal. One of these general framework 
contracts, which will run for three years, covers the environment and the other transport 
infrastructure. 
The consultants selected are among the best in Europe. Their qualifications and independence 
guarantee the quality of the analyses, verification or evaluation which they will be asked to 
carry out from time to time and on a case-by-case basis. 
Types of measures chosen 
The Commission has financed three types of measures: 
* general studies including the conclusions of the study analysing the hydrological situation of 
the Iberian Peninsula, which helped define a frame of reference to assess the projects for the 
supply of drinking water submitted by Spain and Portugal. The Cohesion Fund also financed 
a study on the availability of water in the Guadiana basin to define the conditions required 
for carrying out the major water supply projects which are being prepared there and a study 
on application of the polluter-pays principle, of which more details are given below; 
* economic or technical analyses of individual projects submitted to the Cohesion Fund 
relating to ports, waste, water supply systems and measures to check erosion; 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 77 
technical audits of projects already approved by the Fund to ensure that the conditions of 
their implementation comply with the objectives laid down. 
Study of the application of the polluter-pays principle 
During 1996 a study was undertaken for the Cohesion Fund by ECOTEC Research and 
Consulting into the application of the polluter-pays principle in the environmental sectors in 
which the Fund primarily intervenes, namely: water supply, waste-water management and 
urban solid waste disposal. The study established a methodological framework for assessing the 
tariff setting process and application of the polluter-pays principle; examined the costs of 
service provision for different end users and the extent of cost recovery in the services 
concerned; and provided an assessment of the potential economic, social and environmental 
impact of moves towards greater cost recovery. The study looked primarily at the situation in 
the Cohesion countries but also drew parallels with experience elsewhere in the EU 
(specifically in Denmark, Germany, France and the UK). 
The final report on the study, which was submitted in December 1996, contains profiles on 
each of the Cohesion countries, giving an account of the legal and institutional background to 
cost recovery for environmental services and provides regional case study profiles. 
2.4.3 AT THE INITIATIVE OF THE MEMBER STATES 
In July 1996 the Spanish authorities submitted a request for assistance from the Cohesion Fund 
towards the financing of technical feasibility and design studies relating to the Salamanca -
Fuentes de Onoro section of the Castilla motorway. This section, some 103.5 km in length, 
links Salamanca to the Spanish/Portuguese border at Fuentes de Oiioro and forms part of the 
Lisbon -Valladolid road corridor which is one of the high priority TENs projects agreed at the 
Essen European Council in December 1994. The project will provide an important link between 
Portugal, Spain and the rest of the EU. In view of the priority nature of this corridor, the 
Cohesion Fund will be financing these technical studies, exceptionally, at 100%. Total 
assistance for the project, which is expected to be formally adopted early in 1997, amounts to 
ECU 4.9 million. 
2.5 PAYMENTS BY MEMBER STATE: PAYMENTS IN 1996 
ECU 
Member State 
ES 
GR 
IRL 
PO 
Tech.Ass. 
TOTAL Advances 
202 849 266 
50 332 579 
38 388 872 
83 925 480 
-
375 496 197 Interim 
payments 
821 347 508 
157967 181 ' 
134 769 559 
219 500 435 
I 333 584 683 Balances 
87 860 630 
36 452 527 
15 961 805 
21 469 762 
161 744 724 Total 
1 112 057 404 
244 752 287 
189 120 236 
324 895 677 
1 156 625 
1 871 982 229 % 
59.4 
13.07 
10.1 
17.36 
0.02 
100 
Annual report of the Cohe on Fund \(K\ 
CHAPTER 2 - Financial assistance committed and paid by the Fund 78 
As the table of payments shows, the distribution by type of payment shows a relatively 
high percentage (18.64%) of advances, in order to make available immediately part of 
the assistance from the Cohesion Fund and so provide the financial boost required for 
the studies needed and the start of work. 
2.6 PROJECTS CLOSED 
All the projects part-financed by the cohesion financial instrument or the Cohesion Fund 
undergo an ex post evaluation. 
The projects closed at the end of 1996 are: 
• SPAIN 
0 ENVIRONMENT 
Project No 93/11/61/012-023 : Decision C(93) 3814 final of 16.12.1993 
Erosion control and reconstitution of vegetation cover. 
Work included: reafforestation of areas with insufficient vegetation cover, improvement of 
the quality and quantity of natural stands and regulation of torrential water courses in the 
twelve water systems. 
Assistance granted: ECU 50 882 418 
Project No 93/11/61/041 : Decision C(93) 2797/2 of 6.10.1993 
LINDE (1st stage) 
Study to identify on-the-spot, analyse and classify the sections of water courses which 
should be incorporated into the sphere of public water supplies. 
Assistance granted: ECU 1 071 960 
Project No 93/11/61/042-050 : Decision C(94) 2683/final of 13.10.1994 
Work to improve the beds, banks and shores of water courses in nine catchment areas. 
The works involve consolidation and strengthening of banks and shores, providing access to 
watercourses; restoring run-down areas and overhauling water equipment in nine catchment 
areas. 
Assistance eranted: ECU 10 878 674 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 79 
Project No 93/11/61/052-053.055.057-059 : Decision C(94) 3014 of 16.11.1994 
Restoration of beaches in Spain. 
Work to restore six seriously eroded beaches by adding sand and constructing breakwater 
dykes. 
Assistance granted: ECU 23 643 186 
Project No 93/11/61/056 : Decision C(94) 3094/final of 18.11.1994 
Reconstruction of the Orillamar seaside walk around the tower of Hercules in La Coruna. 
Work to improve the area around the Tower of Hercules and Saint Amaro bay by creating a 
46 ha open space, so facilitating restoration of the natural environment, work to enlarge the 
pedestrian area and creation of an archaeological park. 
Assistance granted: ECU 3 616 599 
Project No 93/11/61/063 : Decision C(93) 3979/4 of 16.12.1993 
Canalisation of the waters in the retaining lake from Picadas to the Valdemayor lake to 
supply Madrid. 
The project will guarantee water supplies to the population of Madrid and ensure the supply 
of 100 million mJ of water per year via a pipe 32.5 km long. 
Assistance granted: ECU 44 096 571 
Project No 93/11/61/064-068. 076 : Decision C(93) 3979/5 of 16.12.1993 
Improved management of water resources in four Autonomous Communities. 
Work to increase the capacity of the water supply system in the Autonomous Communities 
of Madrid, Andalusia, Castille and Navarre. The work includes canalisation, connections 
with reservoirs, sampling and a station to treat the water to be supplied. 
Assistance granted: ECU 26 233 568 
Project No 93/11/61/071. 074 : Decision C(94) 3284 of 30.11.1994. 
Canalisation of the Miraflores at Seville and protection of parts of the Nalôn in Asturias. 
(a) Canalisation of 3 295 m of the River Miraflores and improvement of 300 m of the bed by 
rock fil lin» at source. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 80 
(b) Dredging the bed of the Nalôn and protection of banks by means of a rock dyke and 
concrete walls. 
(c) Alterations to 562 m of road and construction of a pedestrian overpass. 
Assistance granted: ECU 2 119 550. 
Project No 93/11/61/079-080 : Decision C(93) 3979/6 of 16.12.1993. 
Water supply to Seville. 
The aim of the project was to increase the water resources available to Seville by connecting 
the Viar to its supply system, the other part of which could be linked to the connector to the 
Pintado retaining dam via pumping stations and canals. 
Assistance granted: ECU 15 433 800 
Project No 95/1 l/61/043-7a : Decision C(96) 586 of 4.3.1996. 
Construction of an advanced recycling centre in the Basque Country. 
The centre comprises three units for waste used oil, solvents and drilling lubricants, and a 
laboratory to analyse waste used oil from the Autonomous Community of the Basque 
Country. 
Assistance granted: ECU 3 716 048. 
Studies 
94/11/61/007 Decision C(94) 2127 of 27.7.1994 
Preparatory study on technical assistance to prepare strategic frameworks for groups of 
projects relating to the coast and water courses. 
Assistance granted: ECU 39 658 
94/11/61/008 Decision C(94) 2686/final of 13.10.1994 
Group of preparatory studies on technical assistance for the evaluation and cost-benefit 
analysis of assisted environmental projects. 
Assistance manted: ECU 363 497 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund ,81 
94/11/61/009 Decision C(94) 2678/final of 13.10.1994 
Preparatory study on technical assistance for the macro-economic evaluation of projects 
assisted by the Cohesion Fund. 
Assistance granted: ECU 30 000 
0 TRANSPORT 
Project No 93/11/65/001 Decision (93) 2799/1 of 6.10.1993 
Madrid-Valencia motorway (1st stage) 
Technical feasibility and design studies relating to a high capacity motorway linking 
Valencia to the Levante motorway and, hence, Madrid. 
Assistance granted: ECU 4 960 494 
Project No 93/11/65/002 Decision C(93) 2799/2 of 6.10.1993 
Rias Bajas motorway (1st stage) 
Technical feasibility and design studies relating to a high capacity motorway which will link 
Galicia and Northern Portugal with the trans-European network 
Assistance granted: ECU 19 920 769 
Project No 93/11/65/003 Decision C(93) 2799/3 of 6.10.1993 
Bailén-Granada motorway (1st stage) 
Technical feasibility and design studies relating to the construction of a motorway between 
Bailén and Granada which will improve communications between Eastern Andalusia and 
the Madrid-Seville corridor 
Assistance granted: ECU 6 731 372 
Project No 93/11/65/006 Decision C(93) 3746 of 13.12.1993 
N-340 Adra by-pass 
Dualling of a 10.02 km section of the Adra by-pass which lies on the N-340 highway 
between Malaga and Ahneria 
Assistance manted: ECU I I 086 953 
Annual report of the Cohesion fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 82 
Project No 93/11/65/011 Decision C(93) 2378/2 of 2.9.1993 
M40 Madrid ring road - Northern distributor, section 3 
New section 7.715 km in length of the M40 Madrid ring road, including the construction of 
49 structures and 8 under-passes 
Assistance granted: ECU 63 045 000 
Project No 93/11/65/012 Decision C(93) 3258/1 of 15.11.1993 
Valladolid ring road-East 
Construction of new section of some 7 kms in length of the Valladolid ring road between the 
Northern ring and the N601 highway linking Valladolid and Toledo 
Assistance granted: ECU 22 041 228 
Project No 93/11/65/013 Decision C(93) 3258/2 of 15.11.1993 
Access to Santiago de Compostela 
New dual carriageway road of some 1.9 kms which will relieve Santiago of through traffic 
originating in Northern Galicia and Orense province 
Assistance granted: ECU 6 165 706 
Project No 93/11/65/014 Decision C(94) 1179 of 17.5.1994 
Lardero by-pass 
Construction of the Lardero by-pass of some 4.62 kms in length on the Nl 19 highway from 
Medinaceli to Pamplona and San Sebastian 
Assistance granted: ECU 6 842 028 
Project No 93/11/65/018 Decision C(93) 2799/5 of 6.10.1993 
Trinidad-Montgat motorway 
Consisting of a 4.4 km section between Comeria and Montgat. this project forms part of the 
second Barcelona ring road and develops the second section of the Barcclona-Montgat 
motorwav 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 83 
Assistance granted: ECU 31 605 733 
Project No 93/11/65/020 Decision C(93) 2244/3 of 29.7.1993 
TGV Madrid-Seville: Majarabique interchange 
Railway gauge interchanger at Majarabique (Seville), including links with the lines to 
Huelva and Cadiz so as to allow rolling stock using an international gauge to change over to 
the Renfe gauge and continue to those cities 
Assistance granted: ECU 3 152 353 
Project No 93/11/65/022 Decision C(93) 2244/5 of 29.7.1993 
Madrid-Barcelona HST (first stage) 
Technical studies relating to the Zaragoza-Lérida and Calatayud-Ricia sections of the 
proposed high-speed line between Madrid and Barcelona 
Assistance granted: ECU 7 696 017 
Project No 93/11/65/023 Decision C(93) 3258/4 of 15.11.1993 
N-632: duplication of section from Las Duefias toNovellana 
Construction of a section of 6.389 kms to provide an alternative to the N632 between 
kilometre points 124.7 and 133.6. 
Assistance granted: ECU 16 531 743 
Project No 93/11/65/025 Decision C(93) 3592/2 
Valencia-Tarragona railway 
Widening of existing bed to permit the doubling of the line and raise the design speeds to 
200/220 km/lir. over a 37 km section between Alcanar and Camarles. 
Assistance granted: ECU 24 387 730 
Project No 93/11/65/031 Decision C(93) 3592/4 of 10.12.1993 
Hierro airport 
Construction of new road link providing access to the apron and car parking area at the 
airport of Hierro (Canary Islands). 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 84 
Assistance granted: ECU 363 796 
Project No 93/11/65/032 Decision C(93) 3592/5 of 10.12.1993 
Tenerife North airport 
Repairs to road surface at piers 12 and 20, and to the runway and holding areas at Tenerife 
North airport (Canary Islands). 
Assistance granted: ECU 323 977 
Project No 93/11/65/033-034 Decision C(93) 3592/6 of 10.12.1993 
Palma de Mallorca airport 
Extension of the apron and construction of a passageway under the taxi way to provide 
access to a planned industrial zone. 
Assistance granted: ECU 4 300 489 
Project No 93/11/65/009 Decision C(93)3680 of 14.12.1993 
Madrid-Valencia motorway-Requena-Chiva 
Upgrading to motorway of Nl 1 1 between Requena and Chiva, a total length of 29.3 kms. 
Assistance granted: ECU 83 783 968 
Project No 93/11/65/017 Decision C(93) 2770 of 8.10.1993 
M40 Madrid ring road-Northern distributor, section 2 
New section of the northern loop of the M40 Madrid ring road of 7.1 kms in length between 
the NVI and the Via Borde de Hortaleza. 
Assistance granted: ECU 79 169 761 
Project No 94/11/65/011 Decision C(94) 3757/8 of 21.12.1994 
Highway N632. Novellana-Cadavedo 
Construction of an alternative to the N632 highway of 12.8 kms. between Novellana and 
Cadavedo. 
Annual report of the Cohesion fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 85 
Assistance granted: ECU 28 343 275 
Project No 94/11/65/004 Decision C(94) 3757/3 of 21.12.1994 
Lérida by-pass 
Construction of the Lérida by-pass on the Nl 1 from Madrid to France via Barcelona. 
Assistance granted: ' ECU 80 341 241 
Project No 95/11/65/009 Decision C(95) 3647 of 12.1.1996 
Motorway connection Guipuzcoa-Navarra 
Construction of new motorway A15 linking Guipuzcoa and Navarra including works related 
to sections 11(a) and 11(b) and equipment for tunnels on the section in Guipuzcoa (San 
Lorenzo and Belabieta). 
Assistance granted: ECU 8 452 365. 
• PORTUGAL 
0 ENVIRONMENT 
Project No 93/10/61/001 : Decision C(93) 3287/4 of 22.11.1993 
Decision C(96) 339 of 9.2.1996 
Water distribution system for Lisbon 
Extension of the distribution system for Lisbon by 15 km to cope with the growth of the 
city. Replacement and overhaul of 50 km of pipes, branches and other parts of the system. 
Assistance granted : ECU 7 817 600 
Assistance paid: ECU 7 817 600 
Project No 93/10/61/011 : Decision C(93) 3287/5 of 22.1 1.1993 
Overhaul of Vila Franca de Xira-airport supply pipe 
The project includes a range of work: overhaul of the Trancào crossing, stabilisation of the 
banks at Bom Retiro. Sao Joào dos Montes and Bairro da Mata and overhaul of the supply 
pipe in the Tunnel d'Alhandra area. They will be carried out at various points along the Vila 
Franca de Xira-airport supply pipe. 
Assistance uranted: ECU I 029 350 
Annual renort of the Cohesion fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 86 
Assistance paid ECU 933 257 
Project No 93/10/61/012 : Decision C(93) 3287/6 of 22.11.1993 
Increasing the capacity of the Castelo de Bode supply pipe 
This is the first stage of the increase in the capacity of the intermediate section of the 
Castelo de Bode supply pipe, which involves doubling three sections over 9.2 km. This first 
stage also includes the studies and technical plans required to carry out the whole project. 
Assistance granted: ECU 10 471 151 
Assistance paid: ECU 9 663 772 
Project No 93/10/61/017: Decision C(93) 3347/4 of 7.12.1993 
System for the treatment of solid waste from the greater Oporto area: study on the 
assessment of submissions in response to the invitation to tender. 
An international public invitation to tender was issued for the construction of the station to 
treat solid waste from the greater Oporto area; this study is a preliminary step in selecting 
the future contractor. 
Assistance granted: ECU 272 000 
Assistance paid: ECU 234 709 
0 TRANSPORT 
Project No 93/10/65/003 : Decision C(93) 2931/1 of 21.10.1993 
Decision C(95) 2918 of 24.11.1995 
IP3 Figueira da Foz-Santa Eulélia 
Construction of a 12.3 km section of road forming part of the IP3 main road. This section 
includes 11 structures (1 viaduct, 5 over-passes and 5 under-passes). 
Assistance granted: ECU 13 127 400 
Assistance paid: ECU 12 282 965 
Project No 93/10/65/004: Decision C(93) 2931/2 of 21.10.1993 
Decision C(95) 2918 of 24.11.1995 
IP6 Alcanena-Atalaia 
Construction of a 17.5 km section of road forming part of the IP6 main road. This section 
includes 3 I structures (2 bridges, 1 viaduct, 25 over-passes and 3 under-passes). 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 87 
Assistance granted: 
Assistance paid: ECU 23 821 250 
ECU 23 821 250 
Project No 93/10/65/005: 
A2 Palmela-Marateca Decision C(93) 3287/1 of 22.11.1993 
Construction of a 19.3 km section of motorway forming part of the A2 - Lisbon/Algarve 
motorway. This section includes 34 structures (1 viaduct, 14 over-passes and 14 under­
passes). 
Assistance granted: 
Assistance paid: ECU 13 217 500 
ECU 12 217 500 
Project No 93/10/65/008 : 
Al Alverca-Vila Franca de Xira Decision C(93) 2245/5 of 29.7.1993 
Decision C(94) 3726/1 of 21.12.1994 
Decision C(95) 2918 of 24.11.1995 
Widening of a 9.1 km section of the Nord motorway between Alverez and Vila Franca de 
Xira (from 2x2 lanes to 2x3 lanes). 
Assistance granted: 
Assistance paid: ECU 32 327 800 
ECU 32 327 800 
Project No 93/10/65/009 : 
AI Vila Franca de Xira-Carresado Decision C(93) 2245/6 of 29.7.1993 
Decision C(94) 3726/1 of 21.12.1994 
Decision C(95) 2918 of 24.11.1995 
Widening of a 6.2 km section of the Nord motorway between Vila Franca de Xira and 
Corregado (from 2x2 lanes to 2x3 lanes). 
Assistance granted: 
Assistance paid: ECU 6 296 800 
ECU 6 296 800 
Project No 93/10/65/012: Decision C(93) 3813 of 16.12.1993 
Eastern road for the port of Sines and link to terminals in the western part 
Construction of a road to link the terminals in the eastern part of the port to the national 
network and link with the terminals in the western area plus related landscaping. 
Assistance «ranted: ECU 1 998 096 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 88 
Assistance paid: ECU I 998 096 
Project No 93/10/65/024 : Decision C(93) 3287/3 of 22.11.1993 
Decision C(94) 3073/2 of 18.11.1994 
System to prevent accidents involving dangerous substances - Sines 
Modernisation and installation of systems and equipment to monitor operations in the port 
of Sines involving dangerous substances, including the prevention of accidents. 
Assistance granted: ECU 2 095 672 
Assistance paid: ECU 2 095 672 
Project No 93/10/65/026 : Decision C(94) 952/2 of 28.4.1994 
Decision C(95) 2918 of 24.11.1995 
Rail access to the general loading terminal in the port of Sines 
Extension of the track from the multi-modal terminal to the general loading terminal, 
construction of the auxiliary park for that terminal, including a shunting yard and covered 
warehouse, and purchase of equipment for vertical and horizontal handling. 
Assistance granted: ECU 3 169 227 
Assistance paid: ECU 3 169 227 
Project No 93/10/65/030: Decision C(94) 952/3 of 28.4.1994 
Decision C(95) 2918 of 24.11.1995 
Studies and plans to extend the multipurpose terminal in the port of Sines 
Economic and tlnancial assessment and technical plans to extend the multipurpose terminal 
in the port of Sines by extending the quays to provide an extra berth. 
Assistance granted: ECU 152 639 
Assistance paid: ECU 152 639 
Project No 94/10/65/003 : Decision C(94) 2128/1 of27.7.!994 
Environmental impact study concerning construction of the Lisbon inner (CRIL) and outer 
(CREL) ring roads 
Study to identify and evaluate the positive impact of this infrastructure on the environment. 
Assistance granted: ECU 53 890 
Assistance paid: ECU 53 890 
Annual report of the Cohesion FIIIKI 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 89 
• GREECE 
0 ENVIRONMENT 
Project No 93.09.61.012 Decision C(94) 3674 of 20.12.1994 
93.09.61.013 
93.09.61.014 
- Soil protection 
- Reafforestation 
- Forest protection-fire protection 
The work carried out comprises: 
(a) technical and forestry work to protect mountain soil against erosion; 
(b) afforestation, the construction of firebreaks, reservoirs and water points; 
(c) the prevention of forest fires (roads, firebreaks, fire points, observation posts, supplies 
and equipment, reservoirs) 
Assistance granted (85%) ECU 12 081 631 
Project No 93/09/61/019 Decision C(96) 553 of 1.3.1996 amending 
Decision C(93) 3512/2 • 
Disposal of waste water at Fili 
The work comprises provision of 630 m of conduits for waste water and 19 well units 
Assistance granted (85%) ECU 1 408 939 
Project No 93/09/61/037 (A'stage) 
Disposal of waste water at Xanthi 
Assistance mauled (85%) Decision C(96) 553 of 1.3.1996 amending 
Decision C(93) 3512/2 
ECU 2 794 459 
Project No 94/09/61/037-2 (B'stage) Decision C(95)3 141 /10 of 14.12.1995 
Disposal of waste water at Xanthi 
Assistance granted (85%) ECU I 694 352 
The work contributes to completing the network for disposing of waste water from the town. 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 90 
Project No 93/09/61/055-1 Decision C(94) 672/3 of 12.4.1994 amended 
by Decision C(95) 1719 
Biological treatment station at Veria 
Assistance granted (80%) ECU 5 405 904 
The work contributes to completing construction of the biological treatment station 
to serve a population equivalent to 70 000. 
Project No 94/09/61/011 Decision (94) 3560/2 final of 16.12.1994 
Study on the management of the Evinos catchment area and hydrological study of the 
Evinos karstik system. 
Assistance granted: ECU 93 500 
0 FRANSPORT 
Project No 93/09/65/002: Decision C(93) 3682 of 14.12.1993 
Improvement of runway - A at Athens airport. 
Changes to the geometry (longitudinal and latitudinal) of runway - A; improvement of the 
non-slip surface coating, asphalting and improvement of electronic facilities. 
Assistance granted: ECU 1 038 370 
• IRELAND 
0 ENVIRONMENT 
Project No 93/07/61/042 Amended Decision C(95) 3008 final/1 of 
6.12.1995 
Industrial contributions to waste water treatment 
The project comprises a study commissioned by the Irish authorities in order to develop an 
approach to financial contributions from the industrial sector to waste water management. 
Assistance «granted: ECU 24 029 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
0 TRANSPORT 
Project No 93/07/65/001 Amended decision C(95) 1874 final/3 of 
25.7.1995 
N4 Longford Town by-pass" 
The project involves construction of 5.4 km of single carriageway to by-pass Longford, so 
relieving the town of considerable traffic, particularly heavy commercial vehicles, and 
reducing pollution, visual intrusion and noise. 
Assistance sranted: ECU 7 803 850 
Project No 93/07/65/002 Amended Decision C(95) 2978 final/5 of 
4.12.1995 
KiHarney Road Interchange 
The provision of the Killarney interchange (together with other improvements on the Nl 1 
route) will provide for economic development by improving the major Dublin - Rosslare 
road and remove a major accident hazard on the route. 
Assistance granted: ECU 4 684 350 
Project No 93/07/65/006 Amended Decision C(95) 2978/5 of 
4.12.1995 
Road network improvement 
This is a group of 12 related projects, all on TEN roads, intended to improve the standard of 
the carriageway by providing new pavement, improving existing drainage, widening the 
carriageway and improving safety measures. 
Assistance granted: ECU 31 332 700 
Project No 93/07/65/008 Amended Decision C(95) 3008 final/6 of 
6.12.1995 
N I Balbriggan by-pass 
The project provides 11.5 km of dual two-lane motorway by-pass. This will reduce travel 
times and will improve travel between Dublin and Belfast and access to sub-regions, so 
enhancing their attractiveness as locations for investment and economic development. 
Assistance granted : ECU 2 706 400 
Annual report of the Cohesion Vund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 92 
Project No 93/07/65/009 Amended decision C(95) 3008 final/6 of 
6.12.1995 
Nl Dunleer/Dundalk Road 
The project provides 15.6 km of dual two lane motorway from Dunleer by-pass to south of 
Dundalk. This will reduce travel times and will improve travel between Dublin and Belfast 
and access to sub-regions, so enhancing their attractiveness as locations for investment and 
economic development. 
Assistance granted: ECU 3 081 250 
Project No 93/07/65/010 Amended Decision C(95) 3250 final/1 of 
18.12.1995 
N8 Downstream crossing of River Lee 
The provision of a new downstream crossing of the river will significantly reduce the level 
of congestion in the city centre area, facilitate traffic flow and relieve the existing pressures 
on the urban communities, so improving the environment. 
Assistance granted: ECU 6 094 500 
Project No 93/07/65/022 Amended Decision C(95) 3008 final/7 of 
6.12.1995 
Dublin - Galway Rail Link Upgrade 
The project involves upgrading the basic infrastructure of the Dublin - Galway railway line 
to achieve safer and more efficient passenger and freight services and enhance the 
competitive position of the rail route relative to the road link. 
Assistance granted: ECU 1 694 370 
Project No 94/07/65/001 Amended Decision C(96) 2113 final/14 of 
29.7.1996 
Waterford Port Dredging 
The dredging of the port to achieve 6 metres minimum depth of water and to provide a 
turning basin will improve access to the Belview Port, reduce delays caused by tidal 
conditions, allow larger vessels to use the port and improve safety. 
Assistance granted: ECU 1 330 250 
Annual report of the Cohesion Fund 1996 
CHAPTER 2 - Financial assistance committed and paid by the Fund 
Project No 94/07/65/011 Amended decision C(95)1874 final/3 of 
25.07.1995 
Main Road Corridor Improvement Programme 1994 
The project covers seven similar road improvement projects on major road corridors . This 
is intended to raise the standard of the carriageway by providing new pavement, improving 
existing drainage and widening the carriageway. 
Assistance granted: ECU 11 416 350 
Annual report of the Cohesion Fund 1°°' 
CHAPTER 3 - Convergence and conditionality 94 
CHAPTER 3 
CONVERGENCE AND CONDITIONALITY 
3.1 BACKGROUND 
Cohesion Fund assistance is conditional upon the Member States meeting certain criteria 
related to the excessive deficit procedure of the Treaty. Article 6(3) of the Cohesion Fund 
Regulation provides that suspension of finance shall not take effect less than two years after the 
entry into force of the Maastricht Treaty, i.e. on 1 November 1995. The principle of 
conditionality therefore applied throughout 1996, as described in Chapter 1. The convergence 
programmes of the Member States are described below. 
In this Chapter, the figures given as estimates are those which appeared in the Commission's 
autumn 1996 Economic Forecasts, although certain later developments have also been 
included. 
3.2 CONVERGENCE PROGRAMMES 
3.2.1 SPAIN 
In 1996 Spain's economic policy continued to be guided by the convergence programme 
approved in July 1994, as revised for 1995-97. This is intended to help Spain progress towards 
real and nominal convergence and, in particular, to meet the criteria for the third stage of EMU. 
Economic activity increased substantially at the beginning of 1996 and the situation improved 
still further during the second half of the year. GDP is estimated to have grown by 2.1%> in 
1996, above the EU average of 1.6%. Spain has also been successful recently in creating jobs, 
reducing unemployment from 22.9% to 21.9%) between the first and third quarter of 1996, a 
reduction which would have been still greater if the labour force had not also grown 
substantially. 
During 1996. the Government adopted new structural reforms including an increased supply of 
urban land, the opening up of the telephone service to competition, access by third parties to 
the basic telecommunications network and the launch of a large-scale privatisation programme. 
Complete liberalisation of the telecommunications sector is planned for 1998. These measures 
will permit the more efficient allocation of resources on a permanent basis. 
Inflation fell sharply in 1996: as an annual average, from 4.7% in 1995 to 3.6% in 1996 and 
from 4.3% in December 1995 to 3.2% in December 1996. Interest rates also dropped steeply in 
1996. The yield on ten-year government bonds dropped from 9.9%) in December 1995 to 6.9% 
at the end of 1996 and the gap compared with German bonds fell to an historic low (about 100 
basis points) at the end of 1996, as compared with 350 basis points at the beginning of the year. 
Annual report of the Cohesion Fund 1996 
CHAPTER 3 - Convergence and conditionality 95 
The total deficit of the public administrations was 6.6% of GDP in 1995, as compared with a 
target of 5.9%) in the revised convergence programme. This was due to the discovery of a items 
of expenditure which had not been recorded before. Under the Cohesion Fund procedure, the 
Spanish authorities gave a firm commitment to comply strictly with the target deficit in the 
1996 convergence programme. The data available suggest that this target of a deficit of 4.4% of 
GDP in 1996 has been achieved. The 1997 budget seeks to reduce the public deficit to 3%> of 
GDP in 1997, as required by the convergence programme. 
Spain is considered by the Council to be a country whose deficit has been excessive within the 
meaning of Article 104c(6) of the Treaty since 1994. Under that Article, the Council has made 
annual recommendations to Spain that it should put an end to that situation. 
3.2.2 PORTUGAL 
The revised Portuguese convergence programme, which covers the period 1994-97, was 
approved by the national authorities in November 1995. It aims at ensuring the full 
participation of Portugal in the third stage of EMU, in particular via a reduction of both fiscal 
imbalances and the inflation differential vis-à-vis the best performing countries in the Union. 
Another objective is the gradual convergence of Portuguese per capita income with the 
European average. 
After the deep recession in 1993, the Portuguese economy resumed growth by mid-94, driven 
by exports. However, against the background of continued weakness of private internal demand 
only in 1996 did real GDP increase at a faster pace than for the EU as whole, at a still moderate 
rate of 2.5%. Despite the sluggish recovery, the objectives of the revised convergence 
programme could be met in 1996, and the targetted decline in the general government deficit 
was even surpassed. 
Portuguese public finances have recorded a substantial and continued improvement since 1993. 
Benefiting in particular from noticeable gains in the efficiency of the tax collection process and 
the reduction of domestic interest rates, the public deficit fell from 6.9% of GDP in 1993 to 
5.1%) in 1995 and 4.0% in 1996. As regards public debt, the increase in the debt/GDP ratio 
slowed down considerably in 1994 and 1995, before returning to a downwards path in 1996, 
when it amounted to some 71%). This favourable development was a result not only of the 
declining primary deficit but also of the reduction in interest rates on public debt. Portugal 
remains, however, a country where the public deficit is considered to be excessive, within the 
meaning of Article 104c of the Treaty. 
A restrictive stance on both monetary and exchange rate policies, coupled with the weakness of 
internal demand, allowed for a marked slowdown of inflation, from 6.8% in 1993 to 4.2% in 
1995 and 3.1%> in 1996. The favourable trend of inflation, combined with the progressive 
increase in the credibility of the policy mix, led to successive reductions in interest rates and, 
above all, in the interest differential vis-à-vis other EU member countries. Particularly 
impressive has been the decline in the long-term differential vis-à-vis the German mark, which 
at the end of 1996 was below 1 percentage point. 
3.2.3 GREECE 
Annual report of the Cohesion Fund 1996 
CHAPTER 3 - Convergence and conditionality 96 
Greece's revised convergence programme was examined by the Ecofm Council on 19 
September 1994. The programme's key objective is to prepare Greece's full participation in 
stage III of EMU in 1999. The programme proposes to achieve this by addressing the 
fundamental challenges confronting the economy: inflation, fiscal imbalances and slow growth. 
The adjustment strategy consists of measures aimed at reducing the budget deficit, reducing 
inflation through a restrictive monetary and exchange rate policy and supporting economic 
growth through, inter alia, rational gse of structural funding. 
When judged against the objectives of the convergence programme, developments since 1994 
have been mixed. On the one hand, Greece's inflation, while declining, has breached the 
programme's objective; on the other hand, progress in redressing budgetary disequilibrium has 
been consistent with the programme's targets. 
The reductions in the deficit, inflation and interest rates have provided the conditions for a 
recovery of economic growth. Growth since 1995 has been stronger than predicted in the 
convergence programme, rising to 2% in 1995 and to an estimated 2.4% in 1996. Factors 
contributing to this have been a recovery in investment, followed by growth in private 
consumption and in exports. Strengthening household spending has been partly associated with 
positive real incomes growth, declines in real interest rates and diminishing tax uncertainty. 
The acceleration of growth, together with rapid liquidity growth related to large net capital 
inflows, has prevented inflation from falling at the rate predicted in the convergence 
programme. In 1995 consumer price inflation averaged 9.3%, and in 1996 8.5%. While 
imported inflation has been reduced to insignificance, reflecting the successful exchange rate 
policy pursued, inflation in the sheltered sectors of the economy has been persistently high. 
In the three years 1994-96 the budgetary targets of the convergence programme were fulfilled. 
Contributing to this have been measures to widen the tax base and modernise tax 
administration. In 1995, steps to improve transparency revealed unaccounted for surpluses in 
the social security system which resulted in a reduction of the general government deficit to 
9.1% of GDP, some 1.6 points below the convergence programme target. In 1996, the general 
government deficit, estimated at 7.6% of GDP, was identical to the convergence programme 
target. Underlying this development, however, was an overshooting of the central government 
deficit by 1 percentage point of GDP, reflecting revenue shortfalls and expenditure overruns 
partly offset by reductions in capital spending. The general government debt ratio declined by 
1.2 points to 1 10.6% of GDP in 1996; the convergence programme had projected no change 
between 1995 and 1996. 
Greece was found to have an excessive deficit in 1994, within the meaning of Article 104c(6) 
of the Union Treaty. Since then, the Council has made annual recommendations to Greece that 
it should put an end to this situation. 
3.2.4 IRELAND 
The most recent programme for Ireland, covered the period 1994 to 1996, and was examined 
by the Ecofin Council on 19 September 1994. The programme was largely successful in 
continuing the stability-oriented policies of the earlier programme. A successor programme is 
still awaited, although the recent agreement between the social partners covering the period 
1997 to 2001 could provide a basis for such a programme. 
Annual report of the Cohesion Fund 1996 
CFIAPTER 3 - Convergence and conditionality 97 
The programme for 1994 to 1996 envisaged a relatively modest annual growth rate for GDP of 
4.0%). Inflation was expected to remain relatively subdued at about 2.5%) per annum, helped by 
the wage moderation inherent in the agreements between the social partners. Fiscal policy was 
aimed at maintaining the budget deficit within 3% of GDP, which was consistent with a 
planned reduction in the debt ratio by 3 to 4 percentage points each year. 
The performance of the economy during 1996 was comfortably within the targets set in the 
programme. GDP growth is expected to have been 7.8%, easily surpassing the quite modest 
target of 4.0%>. The budgetary targets have also been achieved with a comfortable margin. The 
recent period of strong growth has had a favourable impact on the public finances, resulting in 
net borrowing falling to an estimated \% of GDP in 1996 while the debt ratio is estimated to 
have declined by 6.5 percentage points to 75.1% of GDP. Annual inflation in 1996 amounted 
to 2.0% ensuring that the average for the three years 1994-96 was within the 2.5%) target set out 
in the programme. 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 98 p^ 
CHAPTER 4 
ASSESSMENT OF THE PROJECTS AND MEASURES ADOPTED 
4.1 GENERAL 
4.1.1 ASSESSMENT OF PROJECTS 
When the projects submitted by the Member States are considered, particular attention is paid to 
demonstrating that the resources deployed are commensurate with the economic benefits 
expected. 
This prior appraisal is based on a cost/benefit analysis by the Member States and submitted for 
each project or group of projects. In the case of certain environmental projects, the difficulty of 
quantifying the expected benefits has led the Member States to use other, more qualitative, 
methods. 
Using the information provided by the Member States, the Commission has assessed the socio­
economic justification for the projects, where necessary using additional analyses. 
In some cases, on the basis of those analyses, the Cohesion Fund asked the Member States to 
redefine the projects concerned and even refused to finance certain projects. In Greece, for 
example, the projects concerning the ports of Alexandroupoli, Volos and Mykonos were refused. 
Another example is the Enxoe dam in Portugal, which was rescaled before approval, to prevent 
water being used for agricultural irrigation. The project to supply drinking water to greater Oporto 
south was also rescaled. 
Ex post evaluation programme 
In 1996 the Cohesion Fund has been operating for four years, the first projects financed by the 
Fund have been completed and a number of projects are close to completion, with the final 
reports and accounts awaited by the Commission. From now on the number of completed 
projects will steadily increase. 
It is therefore appropriate for the Commission to set up a programme of ex post evaluation. The 
Cohesion Fund management has started a discussion on the design of a possible programme for 
the ex post evaluation of assisted projects. 
The objectives of the mandate for ex post evaluation of projects are defined in Article 13(4) of 
the Cohesion Fund Regulation which stipulates that "during the implementation of projects and 
after their completion, the Commission and the beneficiary Member States shall evaluate the 
manner in which they have been carried out and the potential and actual impact of their 
implementation in order to assess whether the original objectives can be, or have been, 
achieved." 
In addition, the existing Community rules require ex post evaluation to consider the 
environmental impact. 
Annual report of the Cohesion \:\\nd 1996 
Chapter 4 - Assessment of the projects and measures adopted 100 
4.1.2 INCOME-GENERATING PROJECTS 
Where projects generate income, the Cohesion Fund assistance must take this into account. The 
approach adopted is that the assistance granted will be equal to 80/85%> of the part of the 
investment not supported by income. This reduction in assistance has been applied wherever 
investment financed by the Cohesion Fund was found to give rise to substantial net income. 
Income-generating projects include: 
• In Spain : 
Environment Reafforestation and erosion control in the Norte river basins. Decision 
C(96) 2788 of 10.10.1996. Grant approved: ECU 12 847 306. 
Reafforestation and erosion control in the Ebro river basin. Decision No 
C(96) 595 of 7.3.1996. Grant approved: ECU 15 352 436. 
Reafforestation and erosion control in the Duero river basin. Decision No 
C(96) 617 of 7.3.1996. Grant approved: ECU 5 113 726. 
A method for establishing the potential profitability of reforestation 
projects has been developed in co-operation with the Spanish authorities 
and was applied to projects submitted for assistance in 1996. The method 
takes account of the revenue-generating potential of particular species of 
tree and of the ground conditions on which planting is to take place. 
• In Portugal : 
O 
Environment LIPOR II incinerator for solid waste 
Treatment of solid urban waste in Lisbon-north Valorsul 
Transport A3 motorw ay Braga Oeste/Ponte de Lima 
In Greece 
Transport New international airport for Athens at Spata 
Rail complex at Thriassio Pedio 
Athens-Corinth railway line 
Port of Piraeus, Ikonion Quay II 
In Ireland 
Transport Improvements to the container terminal in the port of Cork 
Quay extension in the Port of Waterford 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 
4.2 TRANS-EUROPEAN TRANSPORT NETWORKS 
4.2.1 GENERAL STRATEGY 
In the transport sector the Cohesion Fund finances only infrastructure projects of common interest 
identified under the guidelines referred to in Article 129c of the Treaty. During 1996 the multi­
modal guidelines for the transport TENs were finally adopted by the European Parliament and the 
Council'. These guidelines thus provide the basis for the selection of projects to be assisted by the 
Fund. They define the objectives of the TENs, identify the networks, and set out the criteria and 
specifications for identifying projects of common interest. 
Given its specific objectives and the significant resources at its disposal, the Cohesion Fund has a 
key role to play in the development of the trans-European networks within the four beneficiary 
Member States: approximately half the Fund's ECU 16 billion budget for the period 1993-99 is 
to be allocated to transport projects. 
Nevertheless, it is clear that the size of the task involved in fully implementing the TENs means 
that careful targeting of resources and co-ordination with the Community's other financial 
instruments are essential if the benefits of Community support are to be maximised. The Cohesion 
Fund has therefore worked closely with the Member States concerned to determine priorities for 
action, and co-ordinates its assistance with that of the EIB, the ERDF and the TENs budget to 
ensure that resources are deployed as effectively as possible. 
Within the planned transport networks, priority has generally been given to key road, rail and 
maritime routes which provide or upgrade the main links between the Cohesion Member States 
and the rest of the EU. Other assisted projects are intended to improve communications and trade 
between peripheral regions and the main centres of economic activity within the countries 
concerned, and to improve the continuity of the networks close to urban centres. The many town 
and city by-passes or ring roads financed by the Cohesion Fund serve the dual function of 
improving network links and mitigating the adverse environmental effects of traffic in towns and 
city centres. 
The Cohesion Fund has given particular emphasis to the implementation of the high priority 
projects which were endorsed by the Essen European Council in December 1994 (listed in Annex 
III of the approved TENs guidelines). Of the fourteen priority projects identified, five lie wholly 
or partly within the territories of the Cohesion Member States: high speed train South; the Greek 
motorways (Pathe and Via Egnatia); the Lisbon-Valladolid road corridor; Cork-Dublin-Belfast 
rail link: and the Ireland-UK-Benelux road link. Further details on progress are given in Section 
4.2.3 below. 
With the aim of maximising the impact of Cohesion Fund resources, the following are three main 
areas in which it is considered that assistance can be deployed to best advantage: 
0 financing technical, economic and financial feasibility studies which pave the way for public 
or mixed projects: such studies are costly and risky, given the uncertainty about whether or not 
the full project will go ahead, so that grant assistance serves the useful function of reducing 
risk; 
Decision 1692,96/EC of 23 July 1996. 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 102 
0 assisting the completion of key sections of transport corridors which may in themselves be 
unprofitable, but which ensure the completion of such corridors and thus guarantee or sustain 
their overall economic or financial viability: cross-frontier sections through sparsely populated 
areas are classic examples of this type of support; 
0 financing sections of a route-which lead to "captured traffic" on which the private sector 
then capitalise: access roads to bridges or tunnels on which user tolls may be charged 
examples here. can 
are 
4.2.2 REINFORCEMENT OF THE TRANSPORT NETWORK IN 1996 
In 1996 the Cohesion Fund committed a total of ECU 1 222.1 million to transport projects. This 
includes commitments to new projects, or new stages of existing projects, as well as additional 
commitments to projects approved in previous years (new annual instalments or amendments to 
earlier decisions). This means that total assistance committed since 1993 to transport TENs 
projects by the Cohesion Fund, and its predecessor, the financial instrument, amounts to ECU 4 
219 million, representing a very significant contribution to the further development of the TENs 
within the four Cohesion countries. 
Road and motorway projects have continued to account for the major share of assistance - ECU 
959.5 million, or 78.4% in 1996 - as shown in the table below. This share varies from 61.3% in 
Greece to 83.6% in Spain. Railway projects were the next most important recipients, with a total 
of ECU 222 million of assistance committed, representing 18.1% of the total. Other modes of 
transport took somewhat smaller shares of assistance than in previous years, although the situation 
varies from country to country depending on the specific opportunities presented. 
Commitments to TENs projects by transport sector 
Sector 
Roads 
Railways 
Ports 
A irports 
VTS* 
Total Commitments 1993-95 
ECU million 
2 124.7 
619.1 
114.6 
1 15.5 
21.1 
2 995.0 % of total 
70.9 
20.7 
3.8 
3.9 
0.7 
100.0 Commitments 1996 
ECU million 
959.5 
222.0 
23.0 
15.6 
4.0 
1 224.1 % of total 
78.4 
18.1 
1.9 
1.3 
0.3 
100.0 Total Commitments 1993-96 
ECU million 
3 084.3 
841.1 
137.5 
131.1 
25.1 
4 219.1 % of total 
73.1 
19.9 
3.1 
0.6 
100.0 i 
*VTS - vessel traffic systems for maritime surveillance 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 
Commitments to TENs transport projects 
by Member State and sector 
Member 
State 
Spain 
Portugal 
Greece 
Ireland Transport 
Sector 
roads 
railways 
ports 
airports 
VTS* 
Total 
roads 
railways 
ports 
airports 
Total 
roads 
railways 
ports 
airports 
Total 
roads 
railways 
ports 
airports 
VTS* 
Total Commitments 
1993-95 
ECU - % 
million 
1218.7 71.0 
402.4 23.5 
0.0 0.0 
73.2 4.3 
21.1 1.2 
1 715.5 100.0 
509.4 84.7 
73.1 12.2 
18.9 3.1 
0.0 0.0 
601.4 100.0 
207.7 52.1 
81.1 20.3 
71.0 17.8 
39.1 9.8 
398.9 100.0 
188.8 67.6 
62.5 22.4 
24.6 8.8 
3.3 1.2 
0.0 0.0 
279.2 100.0 Commitments 
1996 
ECU % 
million 
567.4 83.6 
111.0 16.4 
0.0 0.0 
0.0 0.0 
0.0 0.0 
678.4 100.0 
167.2 75.5 
39.9 18.0 
14.5 6.5 
0.0 0.0 
221.5 100.0 
124.1 61.3 
62.7 31.0 
0.0 0.0 
15.7 7.7 
202.4 100.0 
100.9 82.9 
8.4 6.9 
8.5 7.0 
0.0 0.0 
- 4.0 3.3 
121.8 100.0 Total commitments 
1993-96 
ECU % 
million 
1 786.i 74.6 
513.4 21.4 
0.0 0.0 
73.2 3.1 
21.1 0.9 
2 393.9 100.0 
676.6 82.2 
113.0 13.7 
33.4 4.1 
0.0 0.0 
823.0 100.0 
331.8 55.2 
143.8 23.9 
71.0 11.8 
54.7 9.1 
601.4 100.0 
289.7 72.3 
70.9 17.7 
33.1 8.3 
3.3 0.8 
4.0 1.0 
401.0 100.0 
* VTS : vessel traffic systems for maritime swveillance 
Figures for the period 1993-95 include commitments under the interim cohesion financial instrument 
• Roads and motorways 
The large share of assistance granted taken by road and motorway projects is unsurprising 
given the disparities which remain between the road systems in the Cohesion countries and 
those in the rest of the EU, and the corresponding pressures imposed by the continued growth 
of road traffic. The completion or improvement of the key road corridors linking these 
countries with their EU neighbours, the linking of outlying regions with main centres of 
economic activity and the relief of bottlenecks and congestion around main urban centres 
continue to be priorities for action at both national and Community levels. 
In 1996 the share of roads was especially high in Spain (83.6%), where the situation in part 
reflects the approval during the year of two new sections of the Rias Bajas motorway which 
links Galicia to the central Spanish road system and, thereby, to France and the rest of the EU, 
and also provides an outlet for traffic from northern Portugal. Other new roads were approved 
in 1996 and additional assistance was committed to major road corridors such as the trans-
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 104 
Catalonia highway, the Bailén-Granada motorway, the Zaragoza-Huesca motorway, the 
Somport tunnel, and the Seville-Granada-AImeria motorway. In total, commitments to road 
projects in Spain amounted to ECU 567.4 million in 1996, or almost 60% of the total for all 
such projects in the four countries. 
The share of roads was also high in Ireland (82.9%>, or ECU 100.9 million), reflecting t.he 
approval of a series of projects,-including new sections of the main North-South highway and a 
number of town by-passes and relief roads (N7 Limerick, N25 Dunkettle/Carrigtwohill, 
Kildare by-pass and Newmarket-on-Fergus by-pass). 
In Portugal the share of road projects was somewhat lower than in previous years (75.5%). Two 
of the 1996 decisions relate to a new section of the CREL ring road of Lisbon, and a new 
section of the A3, Braga-Ponte de Lima. Additional assistance was, moreover, committed to the 
Tagus bridge during the year. 
In Greece, where the share of road projects was the lowest in 1996 (61.3%), the main feature 
was the approval towards the end of the year of ten decisions relating to new sections of the 
Pathe motorway (the main North-South corridor) following the resolution of long-standing 
difficulties relating to public procurement and project management. Assistance committed from 
the 1996 budget for this project was ECU 124.1 million, thus permitting progress to be made on 
completing priority sections. 
• Railways 
Rail projects attracted ECU 222 million of assistance from the 1996 budget, or 18.1%> of the 
transport total. The main projects approved were the upgrading of the Nord line in Portugal 
(grant of ECU 104.9 million, of which ECU 33.1 million committed from the 1996 budget, for 
the introduction of a four-way track system on one of the busiest sections); the doubling of the 
track on the Thriassio Pedio-Elefsis-Corinth line in Greece (grant of ECU 160 million 
approved, of which ECU 4 million committed in 1996); and the new DART extension in 
Dublin (grant of ECU 16.9 million approved). 
Additional commitments of assistance were also made in favour of certain major projects 
approved in earlier years, including the upgrading to 200/220 km/h of the Mediterranean 
corridor in Spain (ECU 81.7 million), general modernisation of the Spanish conventional rail 
network (ECU 29.3 million), and the doubling of the Evangelismos-Leptokarya section of 
Greece's main North-South rail axis. 
• Ports and airports 
Port projects accounted for ECU 23 million of assistance committed in 1996 (1.9% of transport 
total), while airports accounted for ECU 15.6 million (1.3%). 
As regards ports, the main projects approved were in Ireland (Waterford port dredging, Dublin 
port access, Tivoli container terminal in Cork, Dublin Lo-Lo terminal and Belview quay 
extension), and in Portugal (repair and improvements in Lisbon and Leixôes ports). In Portugal 
a number of applications for assistance for the development of port infrastructure remain under 
consideration. 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 105 
It may also be noted that approval was given during the year for assistance towards the 
introduction of a vessel traffic and information system in the four main ports of Ireland plus the 
Shannon estuary. 
As regards airports, assistance committed in 1996 reflects the annual instalment relating to the 
new Spata airport for Athens, for which a total of ECU 250 million of Cohesion Fund finance 
was approved in 1995. 
4.2.3 ESSEN PRIORITY PROJECTS 
The 14 high priority TENs projects which were adopted by the Essen European Council of 
December 1994 have been included in the newly approved guidelines for the development of 
the TEN network (Annex III). Of these projects, five are located wholly or partly in the 
Cohesion countries. The Cohesion Fund is thus in a good position to help with their 
advancement. The scale of the task is well illustrated by the enormous development costs 
involved: for the five projects alone these have been estimated at a total of over ECU 23 
billion, of which some ECU 12 billion is planned to be spent by the year 2000. 
The following summarises the Cohesion Fund's involvement with these projects and their 
current state of play: 
• HST South 
0 Madrid-Barcelona-Perpignan 
The Cohesion Fund has financed technical feasibility studies for a total of ECU 8.02 million 
on two sections of this line (Zaragoza-Lérida and Calatayud-Ricia). An application for 
assistance towards the construction of the same sections (ECU 351 million) is at present 
under consideration. 
0 Madrid- Vitoria-Dax 
No requests for Cohesion Fund assistance have been received for this line. 
The HST South project is being considered within the ambit of one of the sub-groups of the 
Kinnock high-level group on public-private partnerships (see 4.2.4). 
• Greek motorways 
0 Patras-Athens-Thessaloniki-Bulgarian border (Pathe) 
Construction of this motorway, which provides the main North-South road corridor for 
Greece, has been underway since 1990. The Cohesion Fund approved several sections of the 
motorway for assistance in 1993 and 1994 with a total grant of ECU 58.4 million. 
Difficulties concerning public procurement and project management held up progress in 
1995 but. following their resolution. 10 decisions relating to key sections of this corridor 
were approved towards the end of 1996 (total assistance of ECU 124.1 million). 
0 Via Egnatia (Igoumenitsa-Thessaloniki-•Alexandroupo/is-Turkish border) 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 106 
Work on the 200 km Igoumenitsa-Panagia section started in 1995. In total the Cohesion 
Fund has approved ECU 76.4 million towards various sections of this project, of which 
ECU 40.7 million was approved in 1995. No additional requests for assistance from the 
Cohesion Fund were received in 1996. 
• Lisbon-Valladolid road corridor 
Two sections of the Portuguese part of this corridor received assistance from the Cohesion 
Fund totalling ECU 52.6 million in 1993/94 (Alcanena-Atalaia and Atalaia-Abrantes). 
However, no applications were received and no further assistance was approved in 1996. 
Following a seminar on this project organised by the Cohesion Fund in October 1994, the 
Commission invited the Portuguese and Spanish authorities to submit preparatory studies on 
the cross-border sections of the route for financing by the Cohesion Fund. In July 1996 an 
application for assistance was received for the preparation of technical feasibility studies for 
the Spanish section: Salamanca-Fuentes de Oiioro (to be approved early in 1997). 
The Portuguese authorities have proposed to widen the scope of this priority project to 
create a multi-modal link with Spain and the rest of Europe. The Commission welcomed 
this proposal and held a seminar in October 1996 to consider its implications. The proposed 
changes to the priority project were adopted at the Dublin European Council in December 
1996. 
• Cork-Dublin-Belfast-Larne rail link 
No further assistance was granted to the project in 1996 since the expected completion date 
for the project in the Republic of Ireland is in the first quarter of 1997. The definition of this 
priority project has been extended to include two important feeder lines to Londonderry and 
Limerick. 
• Ireland/UK/Benelux road corridor 
Priority has been given to this project in Ireland and a further ECU 30.2 million was 
committed to it from the Cohesion Fund's 1996 budget. Since 1993 Cohesion Fund 
assistance for the Republic of Ireland's section of the project has totalled ECU 108.0 
million. Substantial additional assistance is foreseen in future years to complete projects 
under construction or under consideration. 
The table below summarises information on the Essen high priority projects which are of direct 
interest to the Cohesion Fund: 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 107 
HST South 
Greek motorways 
Lisbon- Valladolid motorway 
Cork-Dublin- Belfast rail link* 
Ireland/UK/ Benelux road link* 
Total Estimated total 
cost 
12 870 
6 367 
1 072 
238 
2 680 
23 227 . Estimated cost 
1995-99 
4 380 
5 065 
717 
145 
1 540 
11 847 Cohesion Fund 
1993-96 
8.0 
258.9 
52.6 
53.9 
108.0 
481.4 
* Republic of Ireland only 
In addition to the fourteen high priority projects identified in the Christophersen Group's report 
which were endorsed by the Essen European Council, a second list of projects of importance 
was also highlighted. The Cohesion Fund has an interest in the following projects which appear 
in this list: 
- Combined transport in Portugal and Spain 
- The new international airport for Athens at Spata 
- The Marateca-Elvas motorway (on the Lisbon-Madrid corridor). 
Financial assistance for combined transport projects, for sections of the Marateca-Elvas 
motorway, and for the new Spata airport has already been approved. 
The Christophersen Group report also gave prominence to Europe-wide projects relating to the 
implementation of new information technology and traffic management systems for transport 
in the EU. The Cohesion Fund has helped to finance important examples of such projects 
(marine VTS and air traffic control systems) in Spain, Portugal, Greece and Ireland. 
4.2.4 GROUP OF COMMISSIONERS (TENs) / KINNOCK HIGH LEVEL GROUP 
The Cohesion Fund has continued to follow the work of the group of Commissioners which 
was set up early in 1995, under the chairmanship of Mr Kinnock, Commissioner for Transport, 
to co-ordinate and give impetus to the implementation of the trans-European networks. The 
group has concerned itself with the legislative framework for the TENs, monitoring the 
progress of projects of common interest, and exploring ways in which the problem of financing 
the TENs might be resolved. 
Following the informal transport Council in Rome in April 1996, a "High Level Group" was set 
up under the chairmanship of Mr Kinnock, comprising representatives of Ministries of 
Transport and Finance, the private sector and the EIB, with the aim of accelerating the 
implementation of public-private partnerships (PPPs) in the context of the TENs and, in 
particular, the priority projects. The Cohesion Fund has participated in meetings of this group 
and in the sub-group responsible for the FIST South. A final report will be submitted by the 
Kinnock group to the European Council in June. 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 08 
It may be noted that, following the adoption of the TENs transport guidelines in July 1996, new 
advisory committees have been set up for each of the TENs sectors. The Cohesion Fund also 
participated in the first meeting of the transport committee, which took place in November. 
4.3 TRANSPORT/ENVIRONMENT BALANCE 
The Cohesion Fund Regulation requires a suitable balance to be struck between projects in the 
field of the environment and those relating to transport infrastructure. 
The Commission's position in this regard is that, over the period as a whole, 50%> of assistance 
should go to projects in the field of the environment although that objective should not be 
considered rigid: some flexibility has to be retained to deal with special situations. 
In 1996, further progress was made towards that target and commitments under the budget for 
that year were 50.1 % for transport projects and 49.9%> for environmental projects. 
The breakdown of commitment appropriations between the two fields, environment and 
transport, followed the trend of the period 1993-96 in all the Member States: 
Period 
1993 
1994 
1995 
1996 
1993-96 Environment 
ECU 
606 016 992 
923 430 183 
1 036 709 677 
1 219282 135 
3 785 438 987 % 
38.7 
49.8 
48.2 
49.9 
47.3 Transport 
ECU 
958253 511 
929 157 266 
1 1.13 119 907 
1 222 140 391 
4 222 671 075 % 
61.3 
50.2 
51.8 
50.1 
52.7 
In 1996. the breakdown, as a percentage of the appropriations by Member State was as follows: 
Member State 
Spain 
Portugal 
Greece 
Ireland Environment % 
49.4 
49.6 
53.8 
46.0 Transport % 
50.6 
50.4 
46.2 
54.0 
4.4 ASSESSMENT OF COMPATIBILITY WITH THE OTHER POLICIES 
4.4.1 ENVIRONMENTAL PROTECTION 
Article 8 of Council Regulation (EC) No 1164/94 establishing a Cohesion Fund states that 
projects arc to be in keeping with Community policies, including those concerning 
environmental protection. 
The objectives of Community policy on the environment are set out in Article 130r of the 
Treatv. Thev include: 
Annual report of the Cohesion \'und 1996 
Chapter 4 - Assessment of the projects and measures adopted 109 
- preserving and improving the environment; 
- protecting human health; and, 
- the rational utilisation of natural resources. 
The Community programme of policy and measure in relation to environment and sustainable 
development (the Fifth Action-Programme) - adopted by Resolution of the Council in 1993 -
provided for the Cohesion Fund to assist in the achievement of the Treaty objectives and in 
particular, key Community environmental issues such as the reduction of water pollution and 
appropriate waste management. In addition to focusing on key environmental themes, the 
Programme also concentrated on the need to integrate the environmental dimension into other 
Community policies in order to change and influence the undesirable side effects of certain 
economic sectors. 
This latter aspect is of concern to the Cohesion Fund in that transport infrastructures are the 
other key investment priorities to which funding is channelled. 
The Commission has developed a careful prior appraisal procedure for investment in both the 
environment and transport sectors. For environmental projects the application information must 
include: 
- the environmental objectives of the project; 
- details on how the project relates to the application of Community environmental legislation 
on the environment; and, 
- details on whether or not the project forms part of a plan or programme concerned with the 
implementation of Community environmental policy or legislation. 
In addition, and where appropriate, information must also be supplied in regard to the 
environmental impact as required under Directive 85/337/EEC. 
In the case of transport projects, where appropriate, an environmental impact assessment under 
Directive 85/33 7/EEC must also be supplied with the project application. In addition, careful 
attention is paid to any likely consequences for important bird areas (Directive 79/409/EEC) 
and habitats/species (Directive 92/43/EEC) that may be affected by such projects. 
Checks are also carried out on projects in other fields, such as waste management, restoration 
of coastal areas, etc.. to ensure that they too are in line with Community environmental policy. 
Following appraisal, and before taking a final decision on a project, the Commission may add 
conditions relating to attainment of particular environmental objectives or to ensure compliance 
with certain technical requirements specified by Community legislation. Examples include the 
urban waste-water directive (91/271/EEC). 
The question of compatibility does not arise solely before the decision is taken. The Monitoring 
Committees also ensure compliance with environmental policy by verifying that the 
requirements or conditions laid down in the decision are respected. In cases where this is not 
so, payments may be suspended and assistance reduced or even cancelled. 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 
4.4.2 COMMON TRANSPORT POLICY 
The vision of the common transport policy is set out in the Commission's communication "The 
future development of the common transport policy" (COM(92) 494), one of the key features of 
which, alongside the need to take account of the environment in the approach to transport, is the 
policy on the trans-European networks set out in Title XII of the Treaty. 
The common transport policy also takes account of the growing need for operational transport 
infrastructure within a Community without frontiers stemming from the congestion,of a large 
proportion of the existing networks, particularly those at the centre of the Community, and the 
shortcomings in infrastructure around the edges of the Community and in links between the 
outlying regions and the centre. 
The development of trans-European transport networks provides certain solutions to these 
problems and is closely linked to the common transport policy. The Community's contribution in 
this area takes the form of guidelines which will give a genuine boost to the achievement of the 
two basic objectives of the single market and economic and social cohesion. One of the main 
goals of the networks is to link isolated, island and outlying regions to the centre of the 
Community. The guidelines define objectives, priorities and identify projects of common interest. 
The outlying regions will require particular attention. 
All this is reflected in Decision 1692/96/EC adopted by the European Parliament and the Council 
on 23 July 1996. which sets out Community guidelines for the development of the trans-
European transport network. It sees multi-modal transport as one of the responses to increase 
efficiency, network safety and environmental protection. The various modes of transport and the 
projects relating to them are included in these guidelines as part of the implementation of a 
process based on complementarity and gradual integration. The "multi-mode" objective of the 
guidelines is an important criterion for the establishment of priorities. 
The guidelines define the various components relating to the trans-European transport network: 
0 The trans-European road network, with its major routes and links, as the keystone of surface 
transport. 
0 The trans-European rail network composed of high-speed and conventional rail networks and 
combined transport corridors. 
0 The ports play an important role as links between land and sea transport. 
0 The maritime traffic information and management system is of direct concern to sea transport 
since it is a tool for the control, organisation and direction of this traffic in Community waters, 
thereby helping improve safety and efficiency, while protecting the environment in 
ecologically sensitive areas. It is of direct concern for the future development of the outlying 
countries in the south of the Community (Greece, Spain and Portugal). 
0 The trans-European airport network covers some 250 airports selected on the basis of 
quantitative criteria and their roles in linking the Union and the rest of the world and the 
Union with its most remote regions. So that it can operate as intended, the guidelines suggest 
that priority should be given to: 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted I I | 
making optimal use of and increasing airport capacity; 
improving the environmental impact (compatibility with the environment); 
links with other networks. • 
Airports have a special role in providing access, particularly to outlying regions. 
0 Turning to air traffic control, the gradual introduction of an air traffic management network 
(navigation plan, traffic control and management facilities) should improve the safety and 
efficiency of air transport in future. 
The Treaty provides for projects which meet these criteria to receive Community assistance in 
the form of the part-financing of work undertaken by the Member States. The bulk of this 
assistance will come from the Cohesion Fund which, in the four countries where it operates, 
supports transport projects regarded as being of common interest to the networks. 
The Cohesion Fund accordingly makes a very substantial contribution to carrying out transport 
projects, irrespective of mode, so helping compensate for the lack of infrastructure which is 
regarded as one of the barriers to the free movement of people and goods into or out of the 
outlying regions. It has become one of the Community's basic tools for developing the trans-
European network and achieving its objective of introducing sustainable mobility in accordance 
with Community environment policy through support for projects involving different modes of 
transport. 
4.4.3 PUBLIC PROCUREMENT 
In its 1994/95 report, the Commission stressed that it very often felt the need to be physically 
closer to those taking decisions on projects, in order to prepare and monitor applications better 
and speed up implementation and understanding of Community texts. It found that, since 
information on public procurement could be found at national, regional or local level, checks 
ought also to be designed to assist those taking decisions, and so be carried out at an 
appropriate level. As it stated in its 1994/95 report, the Commission had given this considerable 
thought, which led to the adoption on 27 November 1996 of the Green Paper "Public 
procurement in the European Union: exploring the way forward". In 1997 the comments 
made on this document by those engaged in the economy will be assembled to a framework for 
the actual implementation of the paths proposed. Some innovations regarding checks on the 
Structural Funds and the Cohesion Fund were put forward and it will be useful to mention them 
briefly in this Report. 
Of the six chapters of the Green Paper, two have direct relevance to contracts receiving 
Community finance: point IV-D "Attestation" of Chapter 3 "Application of public procurement 
law - current state of play and trends" and point IV "Procurement involving Union funds"' of 
Chapter 5 "Public procurement and other Community policies". The ideas put forward concern 
the creation, at national level, of independent bodies to monitor the "public procurement" rules, 
greater use of the procedure attesting compliance with the Community rules on public 
procurement already laid down by the "special sectors" Directive and making those taking 
decisions on public contracts assume their responsibilities. However, the development planned 
does not entail the Commission giving up its prerogatives; it will continue to carry out its role 
as guardian of the "'procurement rules" under the Treaty and the Directives. 
Annual report of the Cohesion fund 1996 
Chapter 4 - Assessment of the projects and measures adopted I 12 
In 1996, more attention was paid to monitoring applications for finance submitted in the last 
three years, which made it possible to assess better the state of implementation of projects 
through contracts awarded since the adoption of financing decisions (over 200 new 
applications). It is important to note that many applications are submitted by the Member States 
before any procedures to award contracts begin, in order to be certain of Community financial 
assistance before beginning work. Information on the contracts awarded and the records of 
tender procedures are very often not available until the projects are in progress or when 
subsequent instalments or the balance are paid. 
In general, the Commission finds that national authorities and Monitoring Committees 
cooperate well in response to the questions raised by the Commission when it is considering 
projects it has financed, irrespective of stage (application, decision, amendment, payment, 
balance). 
As before, the examination of files has resulted in tlie following situations: 
0 agreement without reservations, where it was found that an application complied with the 
rules on public procurement, all the information relevant to that point has been provided or 
that the project was for an amount lower that the thresholds set out in the "public 
procurement" Directives; 
0 agreement in principle, subject to retrospective checks to be carried out in all cases where 
the contracts were awarded after finance had been granted or where it appeared that other 
procedures could have been launched later; 
0 blocking of the decision to grant finance or of the amendment of a decision until the 
national authorities had clarified doubtful points; 
0 suspension of payments (the Directorates concerned within the Commission being 
associated) if a complaint was received from a firm which considered it had suffered 
damage and warning notice was sent to the national authorities; 
0 refusal of finance where non-compliance with the "public procurement" rules was detected 
in the application or where a complaint had already been made by a firm which considered it 
has suffered damage. 
4.4.4 COMPETITION 
Council Regulation (EC) No 1 164/94 establishing a Cohesion Fund requires in particular that 
assistance from the Funds should comply with competition policy. The Commission therefore 
regularly checks the compatibility with the Treaty of the measures part-financed by the 
Cohesion Fund to verify that its work is fully in line with the Community competition rules and 
especially those on State aids. 
In general, it appears that these measures very rarely raise problems of compatibility with 
competition law. This is mainly because they are usually concerned with infrastructure 
programmes which, unless they infringe the rules on the award of public contracts, place no 
particular firm at an advantage. As a result, Community checks relating to competition usually 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 
concern aspects relating to free access to infrastructure for all operators satisfying the technical 
and legal requirements, and the application of the rules and provisions of Community law on 
aid to the transport sector. 
4.5 SOCIO-ECONOMIC IMPACT OF THE COHESION FUND 
4.5.1 INTRODUCTION 
The Commission is required to assess the actual or anticipated economic impact of the Cohesion 
Fund both at the level of individual projects and at the level of assistance as a whole. 
Cost-benefit anaKsis and other forms of microeconomic analysis are the main methods used at the 
project level, in particular in the context of the prior appraisal of projects submitted for assistance. 
The general procedures for assessing project applications have been described earlier in this 
report. Further details of work undertaken in this area, including some preliminary results of 
recent studies financed by the Cohesion Fund, are given in section 4.5.2 below. 
At the global level, the impact of the Cohesion Fund must be considered within the context of the 
regional and national economies in which its assistance is located. This normallv means usins; 
economic models which seek to mirror the real world - albeit in a simplified form. In this way, 
both the spillover effects of such assistance, their longer term supply-side impacts and any 
feedback effects from the economy can be taken into account. A major study into the 
development of economic models for the assessment of the impact of Cohesion Fund assistance 
was commissioned in 1995 from the London School of Economics and Political Science. The 
LSE's final report was submitted in December 1996. The aims of this study and some 
preliminary results are described in section 4.5.3. 
That section also reports on the results of a study of the macroeconomic impact of the Cohesion 
Fund in Spain which was undertaken for the Spanish authorities in 1995 with finance from the 
Cohesion Fund. 
Finally, section 4.5.4 gives some indications of the potential employment impact of the Cohesion 
Fund. 
4.5.2 ECONOMIC APPRAISAL OF PROJECTS 
Applications for assistance from the Cohesion Fund must be supported by an economic analysis 
demonstrating that the project concerned is expected to generate social and economic benefits 
over the medium-term which are proportionate to the resources deployed - Articles 10(4) and 
10(5) of Regulation (EC) No 1164/94. That is to say, the project must be expected to produce 
positive net benefits and thus add to overall economic welfare. As a general rule, cost-benefit 
analysis must be used for this purpose. However, in the case of environmental projects, where the 
results of cost-benefit analysis may be inconclusive, other forms of quantified analysis, such as 
cost-effectiveness or multi-criteria analysis, may be accepted. 
The preparation of cost-benefit and other economic studies in support of project applications is 
primarily the responsibility of the Member States concerned. The Commission must ensure that 
the methodologies used are acceptable, that assumptions made are appropriate and that the results 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted I 14 
are credible. External consultants or the European Investment Bank may be called upon to help in 
this process while, at the Member State level, technical assistance is available from the Cohesion 
Fund to help in the financing of relevant studies. 
The Member States have, in general, responded well to the challenge of producing cost-benefit or 
other studies in connection with projects submitted for assistance. Both the number of such 
studies and their quality have-improved over the life of the Cohesion Fund. However, the 
Commission is conscious of the need to make additional efforts in this area and to this end it has: 
- proposed commissioning a study from a transport economist of the appraisal methods and 
assumptions used in support of applications for transport projects; 
- financed a study commissioned by the Irish authorities into the economic appraisal of 
environmental projects supported by the Cohesion Fund; 
- approved technical assistance for certain Member States specifically to help them undertake 
preparatory studies relating to projects, including cost-benefit analyses; 
Moreover, during 1997 the Commission is planning to undertake a review of economic appraisal 
methods used in support of project applications with a view to identifying best practice and 
issuing additional sectoral guidelines where required. 
The economic evaluation of environmental projects is generally accepted to be a particularly 
difficult subject area. The Cohesion Fund finances a great variety of projects aimed at 
environmental improvement including water supply schemes, waste water treatment, urban waste 
disposal, erosion control, afforestation, nature conservation and beach restoration. A common 
feature of such projects is that their direct "outputs" do not have a market price or. where a price 
exists (e.g. water supply) it may not reflect the true economic and social value of those outputs. 
These projects, moreover, often have significant indirect effects, for example on health and 
amenity, which are difficult to quantify and value. 
The beneficiary Member States have made a considerable effort to apply appropriate methods in 
their economic analyses of environment projects. Cost-benefit analysis has been the most 
commonly used approach. In some cases an attempt has been made to quantify and value the 
direct benefits of environmental schemes such as improved water quality, improved amenity or 
greater opportunities for recreational use, while in other cases potential indirect effects have been 
estimated, for example, of induced economic development. In many cases such analyses have 
been supplemented by a qualitative assessment of benefits. 
A study for the Irish authorities which was financed by the Cohesion Fund points to the 
difficulties invoked in this area by concluding that, although there is a growing international 
literature on the evaluation of environmental projects, "no standard or universally applicable 
methodology has as yet been agreed upon". The authors go on to say that there is a general lack of 
basic data to be used for such analyses and a lack of experience in the implementation of 
economic appraisal techniques. They suggest that in the short-term there is no alternative to using 
such limited data as is available and to quantifying benefits wherever possible using output 
valuations from existing studies. In the longer term, they recommend that the use of contingency 
valuation methods (involving the valuation of benefits via surveys of user groups) should be 
pursued as these techniques, they argue, have become increasingly accepted and "may become the 
standard tool for non-market benefit estimation". Although this study focussed on water supply 
Annual report of the Cohesion \7und 1996 
Chapter 4 - Assessment of the projects and measures adopted I 15 
and waste water treatment projects in Ireland, its basic conclusions may be more generally 
applicable. 
The Commission is also applying other quantified techniques such as multi-criteria analysis to 
determine priorities for measure in the environmental field. Such techniques have been developed, 
for example, in the case of afforestation and erosion control projects in Spain. 
As already mentioned, a review of the methods used by Member States in the economic appraisal 
of environmental projects will be undertaken during 1997. 
4.5.3 OVERALL SOCIO-ECONOMIC IMPACT 
The Regulation establishing the Cohesion Fund requires the Commission to report regularly on 
"the economic and social impact of the Fund in the Member States, and on its contribution to 
strengthening economic and social cohesion in the Union". 
This implies that the project-based approach has to be supplemented with a more global focus on 
the impact of assisted operations on economic variables such as growth, employment and trade in 
the economies concerned. It also implies attempting to estimate both the short-term demand 
effects of assistance, which occur during the implementation phase, and the medium to longer 
term supply side effects which occur during the operational phase. In the case of transport 
investment, for example, a distinction can be made between the increased income and 
employment directly and indirectly created during the period of construction, and the subsequent 
impact on incomes, employment and trade of the time savings, reduced operating costs and 
general increase in competitiveness induced by the improved transport infrastructure concerned. 
Corresponding effects can also be expected from environmental investments although, as already 
noted, these are more difficult to estimate and are not in many cases picked up by conventional 
measures of national output. 
London School of Economics Study 
In order to comply with the requirements of the Regulation, a study was commissioned in July 
1995 from the London School of Economics and Political Science (LSE) with the aim of 
developing and testing systematic methods for quantifying the socio-economic impact of the 
Fund. These methods were intended to be applicable to both the Fund's main sectors of assistance 
- transport and the environment - and to the four beneficiary Member States. They were also 
intended to be used to estimate the effects of individual projects, or groups of projects, as well as 
aggregate assistance from the Fund. The objective, therefore, was to provide a coherent 
framework for analysing the impact of Cohesion Fund spending in the four countries concerned. 
The LSE has managed the project and has been responsible for the economic modelling work 
involved, but it has worked closely, particularly on data collection and analysis, with study teams 
in each of the four Cohesion countries: Instituto Valenciano de Investigaciones Economicas, 
Universidad dc Valencia; Regional Development Institute, Pantheon University, Athens; Centra 
de Investigaçào de Desenvolvimento e Economia Regional (CIDER), Universidade do Algarve; 
and the Centre for European Economic and Public Affairs, University College, Dublin. 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 
A steering group, consisting of representatives from the Cohesion Fund Directorate (DG XVI-E), 
DG XVI-A and G, DG II, DG XII, and Eurostat, has closely monitored work on the study. 
A draft final report on the study was submitted in September 1996 and revised in December 1996. 
This will be finalised and published sometime in early 1997. The report contains a literature 
survey, a full description of the models developed and the first results of model testing and 
simulation using data on Cohesion Fund projects. A separate volume will contain a description of 
the dataset used: this covers key economic variables, down to the NUTS 3 regional level, in the 
four Cohesion countries and their immediate geographical neighbours (France, Italy and UK). 
The LSE adopted an innovative approach based on the application of the latest econometric 
techniques by three teams of economists to a very detailed regional dataset. The study 
recommends three complementary methods for estimating Cohesion Fund impacts. The main 
features of these approaches and some preliminary results can be summarised as follows: 
• Vector autoregression (VAR) models 
These models seek to establish the impact of Cohesion Fund spending on regional labour markets 
by estimating the dynamic response of economic variables such as private investment and 
employment to changes in public investment. The models use the latest econometric techniques to 
trace the relationship between these variables over a long period of time (15-20 years). Models 
have been developed for each of the Cohesion countries, although results are most complete for 
Spain because of the better availability of data for that country. 
Although based on well established methodologies, the models are innovative to the extent that 
involve a high level of regional disaggregation, they consider the dynamic impact of infrastructure 
spending, and they incorporate spillovers from one region to another. 
Results for all four Cohesion countries point to a strong, positive correlation between public 
investment spending and private business investment in the economies concerned, suggesting a 
very favourable impact from new infrastructure investment. Figures produced by the study permit 
estimates to be made of these potential effects over the long term based on historical patterns. The 
VAR models can also be used to provide estimates of the long term employment impact of 
Cohesion Fund projects and of the effect of such employment changes on the local labour market 
(activity rates, unemployment and migration). 
Preliminary results from model simulations for certain important Cohesion Fund assisted projects 
are as follows: 
Rias Bajas motorway short term +1.17% long term 3900 
long term + 11.0% 
Madrid ring M40 short term + 0.56% long term 3400 
long term +3.3% 
Tagus bridge short term +5.3% long term 16500 
I on "term +3.1% 
Note: the effects in each case relate to the impact on a "representative region" 
Annual report of the Cohesion fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 17 
• Regional computable general equilibrium models 
This approach involves building a computer representation of the real world in which equations 
represent the behaviour of economic agents such as consumers, producers and government. Three 
computable general equilibrium (CGE) models have been constructed during the course of the 
study: for Spain/Portugal, Greece and Ireland. Each model incorporates a set of regions in which 
economic activity takes place (NUTS 2 regions in Spain/Portugal and Greece, and NUTS 3 in 
Ireland), linked by a transport network through which goods and services are traded. Along with 
inter-regional trading partners, the models allow for two external trading partners: the EU and the 
rest of the world. The regions incorporate their own particular factor endowments and industrial 
sectors. 
The CGE models can be used to capture the effects of transport infrastructure investments on a 
particular region and/or all regions of a country by tracing the likely reduction in transport costs 
and consequent changes in trade, industry sales and profits. The analysis can be undertaken in 
stages with progressively greater effects on the mobility of workers and firms. 
Using these stages, total welfare and labour income changes by region resulting from specific 
transport infrastructure projects can be computed over the short, medium and longer term. The 
CGE analysis highlights the spillover effects of changes in transport networks which often ripple 
through numerous regions of a country. First results of simulations, shown in the table below, 
indicate that the total welfare benefits of some projects may exceed those calculated by traditional 
cost-benefit anaKsis, pointing to significant gains in the medium and long run from induced 
changes in activity and industrial location: 
Real income consequences of Cohesion Fund projects 
Rias Bajas* 
Madrid ring M40 
Pathe# 
North-South 
corridor, 
Ireland ECU 
million 
Relative 
ECU 
million 
Relative 
ECU 
million 
Relative 
ECU 
million 
Relative 121 
1.0 
185 
1.0 
933 
1.0 
163 
1.0 140 
1.14 
230 
1.24 
1098 
1.17 
165 
1.01 162 
1.33 
282 
1.52 
1156 
1.24 
184 164 
1.35 
287 
1.55 
1157 
1.24 
183 
1.12 
* Gaficia-Madrid motorway, Spain 
# Pafras-A/hens- Thessaloniki/Bulgarian border motorway 
"relative " indicates the real income effect in short, medium and long run relative to direct effect 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 1 18 
The CGE approach is also one that has a long tradition in economics but the models developed by 
the LSE for the Cohesion Fund are innovative in the degree of regional disaggregation involved, 
their explicit consideration of transport costs, and hence trade, between locations, and their 
assumptions of imperfect competition in the case of some industries. The LSE work represents the 
first attempt to apply regionalised CGE models to a large dataset, and to use them for policy 
analysis. 
• Models of explicit distribution dynamics 
These models consider the dynamics of growth and convergence over the whole cross-section of 
regions in the Cohesion countries in contrast with more traditional approaches, such as regression 
analysis, which only consider the behaviour of a representative region. The models represent a 
development of standard distribution dynamics approaches by including inputs on the specific 
economic structure of regions and on the linkages between regions. A number of graphical and 
statistical representations of the dynamics of regional income distributions are developed by the 
study. 
The models can be used to examine such questions as: 
0 is the entire cross-section of regions tending over time towards income equality or inequality? 
0 how mobile are regions within the regional income distribution? 
0 how does the changing structure of a single region affect the evolution of regional income 
distribution? 
0 how does the changing relationship between regions affect the evolution of the regional 
income distribution? 
0 what are the effects of spillovers between regions? 
The study presents a historical analysis of the trends in regional income distribution at the NUTS 
3 level in the Cohesion countries and attempts to explain the observed patterns in terms of inter­
regional linkages and of the distribution of public and private investment across regions. 
It is considered that these models will be of most use in examining overall trends towards 
convergence in the Cohesion countries as well as the impact of the Cohesion Fund's aggregate 
spending on infrastructure, for example all transport or environmental investments in a particular 
region. 
The models produced as a result of the LSE study, which have been described briefly in the 
foregoing, will be applied to a series of investments financed by the Cohesion Fund over the 
coming years. The aim is to provide important elements for the analysis of individual projects, 
whether on an ex ante or ex post basis, and to provide evidence of the beneficial, long term socio­
economic impact of the Cohesion Fund. 
Macroeeonomic impact of the Cohesion Fund in Spain 
A final report on a study into the macroeeonomic impact of the Cohesion Fund in Spain, which 
had been commissioned by the Spanish authorities with Cohesion Fund finance, was submitted in 
November 1995. The approach adopted by this study was to use existing economic models to 
estimate the global impact of the Fund's assistance on the Spanish economy. 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 
Although the total investments supported by Cohesion Fund money account for a relatively small 
share of total Spanish GDP or gross domestic fixed-capital formation, the author of the study 
nevertheless points to the importance of the Cohesion Fund in supporting public authorities' 
investment efforts. Based on figures for 1993, it is estimated that the Cohesion Fund accounted 
for 12%) of all spending on transport infrastructure by central and regional authorities in that year, 
and for 11%> of environment spending. The figures rise to 18.5%o and 29.1%» respectively if only 
the central authorities' expenditure is counted. These figures understate the present contribution of 
the Fund given the increases which have occurred in the allocations to Spain since 1993. 
The study used three different modelling approaches: an input-output model, the MOISEES 
macroeconometric model and the HERMIN model. The input-output approach estimated the 
anticipated overall and sectoral impact of Cohesion Fund assisted investments in the 1993-99 
period. The results suggest that the maximum effects will be felt between 1996 and 1999 when 
the Cohesion Fund impact accounts for around 0.4%> of the Spanish economy's GDP and total 
employment. In this period it is estimated that it supports an average of 50 000 of man years of 
work. The author estimates that on average one man year of work is created by each PTA 4 
million of spending. The usual reservations about input-output models are made and, in particular, 
it is pointed out that the approach can only measure the temporary effects of Cohesion Fund 
spending. 
Simulations based on the HERMIN model undertaken for this study suggest that for the period 
1993 to 1999 the Cohesion Fund could have an impact of just under l%o of Spanish GDP, with 
over 70 000 jobs dependent on its spending in 1999. The MOISEES model, on the other hand, 
suggests a considerably smaller impact. 
4.5.4 EMPLOYMENT 
The Cohesion Fund does not have an explicit remit to create jobs, but it nevertheless has an 
important contribution to make to employment generation given its substantial resources. 
Infrastructure investments create employment directly and indirectly: in the short term, direct jobs 
arise primarily in the construction industry, while indirect jobs are generated by the increased 
demand for industries and services which supply the construction sector, and which meet the 
needs of the newly employed. In the longer term, employment will also be generated during the 
operational phase of projects: direct employment in this case will be more limited, but longer 
lasting jobs will be generated indirectly to the extent that the new infrastructure reduces 
production costs and improves the attractiveness and competitiveness of the economies 
concerned. 
It is possible to estimate at least some of these effects with a degree of certainty. All Cohesion 
Fund applications must indicate at least the number of direct jobs likely to arise from the projects. 
An analysis undertaken of applications in 1993 and 1994 indicates that on average around 21 jobs 
are generated directly per ECU million of grant in transport projects and 26 jobs per ECU million 
in environment projects. 
If the above averages are applied to the grant assistance approved by the Cohesion Fund since 
1993 the following preliminary results are obtained: 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 20 
Estimated employment dependent on Cohesion Fund 
1993 
1994 
1995 
1996 
TOTAL 36 000 
44 000 
50 000 
57 000 
mm 
: 10 800 
13 200 
15 000 
17 100 
$€ 100 ^ . ' * -
46 800 
57 200 
65 000 
74 100 
243 100 * 
based on estimated multiplier of 1.3. 
These estimates should be interpreted with caution. They are not intended to show the long term, 
net employment impact of the Cohesion Fund, to derive which it would be necessary to make 
assumptions about the extent to which the projects might have been implemented without 
Cohesion Fund assistance and the extent to which other activities within the economies concerned 
have been displaced. The figures are therefore simply an indication of the gross employment 
which is estimated to be dependent on the financed projects over the short term, i.e. the 
construction period. 
In the above table a standard multiplier of 1.3 has been used for illustration. This estimate is a 
cautious one and it may be noted that the responses in the Member States' applications for 
assistance imply almost a 1:1 ratio between direct and indirect employment. 
This approach to employment estimation using project applications is clearly inadequate to 
estimate the long-term employment effects of investment projects. For this purpose the projects 
have to be put into their specific economic context and considered alongside the range of other 
factors influencing economic development. The study at present being carried out by the London 
School of Economics, referred to earlier, is intended to fulfil this function and provide overall 
employment estimates from a sound theoretical base. Some initial estimates relating to particular 
projects are given in Section 4.5.3.1. 
In parallel, however, the information derived from Cohesion Fund applications will continue to 
provide limited but useful indications of employment effects. 
46 CO-ORDINATION AND CONSISTENCY WITH OTHER COMMUNITY 
FINANCIAL INSTRUMENTS 
The need to co-ordinate the financial support measures undertaken in the fields of the 
environment and the trans-European transport networks through the Cohesion Fund, the Structural 
Funds, the EIB and the other financial instruments is stated in the motives expressed by the 
Council when it established the Cohesion Fund. Therefore the Commission, in implementing the 
objectives of the Structural Funds has to ensure the co-ordination and consistency between the 
assistance from the Funds and the assistance provided from the other financial instruments, in 
particular the resources provided by the Cohesion Fund. At the same time, however, the 
Commission has to pay due regard to the principle of subsidiarity that makes the design of the 
national strategy and its objectives, the selection of suitable projects and their implementation 
primarily the responsibility of the Member States. 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 121 
A number of provisions and procedures have been introduced to ensure compliance with this 
obligation. 
4.6.1 STRUCTURAL FUNDS 
The Structural Funds, particularly the ERDF and to a lesser extent the EAGGF Guidance Section, 
may also be asked to provide assistance for projects in the field of environment and trans-
European transport infrastructure. Adequate steps have therefore been taken to co-ordinate the 
measures of the Cohesion Fund with the other Community financial jnstruments for coherence 
and in order to avoid the risk of double financing. 
An obligation to co-ordinate is stipulated in Council Regulation (EC) No 1164/94 establishing a 
Cohesion Fund, Article 9 of which states that no item of expenditure may benefit from both the 
Cohesion Fund and from the Structural Funds. In addition, combined assistance from the 
Cohesion Fund and other Community aid - that is not Structural Fund aid - for a project must not 
exceed 90% of the total expenditure relating to the project. 
As far as the relation with the Structural Funds, in particular where the ERDF is concerned, this 
provision does not prohibit a combination of different instruments making separate contributions 
to different stages of a major undertaking, as long as it is assured that expenditure relating to a 
stage of a project can be clearly identified in time or in nature. 
A number of measures have been taken with regard to the procedures to implement the required 
co-ordination. 
Firstly, the Commission's objective has been to ensure overall co-ordination during preparation of 
the Community Support Frameworks (CSFs) for the beneficiaries of the Cohesion Fund in order 
to reach the real doubling of the commitment appropriations under Objective 1, as decided at the 
Edinburgh European Council. The financing plans of the CSFs make explicit mention of the 
resources allocated by the Cohesion Fund. For Spain, where only part of the country is eligible 
under Objective 1. ECU 7 950 million of the Cohesion Fund allocation for the period 1993-99. 
calculated in order to match the Edinburgh target, was entered in the CSF for its Objective 1 
regions. Following the principles of subsidiarity and partnership, the presentation of appropriate 
projects to ensure the doubling in real terms in Spain's least prosperous regions lies in the hands of 
the national government and the Monitoring Committee for the Objective 1 CSF. As a "non-
regional" fund, the Cohesion Fund does not normally record its assistance under a regional type of 
classification. 
Secondly, co-ordination at the level of concrete projects requires still greater attention in that the 
Structural Funds operate primarily through operational programmes while the Cohesion Fund 
contributes to individual projects or groups of projects. Appropriate co-ordination procedures 
have been put in place to make sure that projects or stages of projects submitted had not already 
been presented to the Structural Funds. These include mandatory consultation of the departments 
managing the Structural Funds before the Commission takes any decision to grant assistance from 
the Cohesion Fund. The departments involved have introduced checks to ensure that no item of 
expenditure can be financed simultaneously by the Structural Funds and the Cohesion Fund. 
Annual report of the Cohesion Vund 1996 
Chapter 4 - Assessment of the projects and measures adopted 122 
These procedures have worked well so far. Since in the framework of the multi-annual operational 
programmes the selection of individual projects normally takes place at the regional programming 
level, the ERDF and Cohesion Fund have started to participate together on a random basis in 
Monitoring Committees in order to increase their knowledge of each other's procedures. 
The above administrative arrangements have ensured that no case of double financing has arisen. 
Member States have, on occasion, submitted different stages of the same project to two different 
instruments, but this is in perfect accordance with the underlying legal provisions. 
As a Directorate of DG XVI - Directorate-General for Regional Policy and Cohesion - the 
Cohesion Fund is in close contact with the administrative units dealing with ERDF programmes 
in the four Member States concerned. The measures taken by the Cohesion Fund and those of the 
Structural Funds are complementary in management and implementation. The objectives pursued 
in achieving efficient and financially sound measures are therefore also complementary i.e. in the 
field of public-private-partnerships, on revenue-generating projects, project management, public 
procurement and competition policy. 
4.6.2 TENs TRANSPORT BUDGET LINE 
The financial regulation laying down the ground rules for support to the TENs was formally 
adopted by the Council in September 1995°. This Regulation provides the legal basis for the 
disbursement of EU funds to the TENs over the period 1995-99. Unlike the Cohesion Fund, the 
TENs regulation applies throughout the Community and covers all three TENs networks: 
transport, energy and telecommunications. The transport networks, however, will account for 
the major share of the total budget - ECU 1 785 million out of ECU 2 345 million. In view of 
the fact that transport projects supported under this Regulation may be similar to those financed 
by the Cohesion Fund, the Cohesion Fund Directorate has had a direct interest in the content of 
the new regulation and kept in close touch with the discussions leading up to its adoption. 
The Regulation allows the Community to provide financial support to the TENs through 
feasibility studies, interest rebates, subsidies for guarantee fees and, exceptionally, through 
straight grants. Only projects of common interest identified in the TENs guidelines are eligible 
for support, up to a total of 10%> of total investment costs (50% in the case of feasibility and 
other studies). 
The Cohesion Fund has, since its inception, maintained close contact with DG VII in order to 
ensure a consistent approach to TENs projects and to ensure compliance with the requirements 
of the respective regulations. In addition to regular inter-departmental discussions, all projects 
submitted for Cohesion Fund assistance are sent to DG VII for comment, and all draft decisions 
relating to the granting of financial assistance are circulated for agreement. DG VII, in turn, 
informs the Cohesion Fund of all applications received for assistance from their budget line and 
of their proposed programme for spending from this line. 
The Cohesion Fund has also participated in meetings of the TEN financial assistance 
committee which has been set up to help the Commission in preparing the annual programme 
of projects to be supported from the transport budget line. 
Council Regulation (EC) No 2236/95 of 15 September 1995. 
Annual report of the Cohesion Fund I99d 
Chapter 4 - Assessment of the projects and measures adopted 123 
The different scale of the resources available to the Cohesion Fund as compared with those of 
the TENs financial regulation is well illustrated by the fact that the latter's budget for TENs 
transport projects throughout the EU was ECU 280 million in 1996, whereas the Cohesion 
Fund's total commitments to TENs projects in the four Cohesion countries was ECU 1 
224 million. 
4.6.3 LIFE PROGRAMME 
Set up in 1992, LIFE is a Community financial instrument to support environmental measures 
throughout the European Union and neighbouring regions. Its general is to contribute to the 
development and implementation of the Community's environmental policy and legislation by 
financing specific measures,. 
A LIFE II programme was set up in 1996 by Regulation (EC) No 1404/96 (OJ No L 181 of 
20.7.1996). It covers the period 1996-99 and has a total budget of ECU 450 million. 
Some environmental projects or measures in the cohesion countries would be eligible under the 
Cohesion Fund and the LIFE Programme. 
To avoid the risk of double financing of certain measures, the Cohesion Fund has regularly 
attended meetings of the LIFE Management Committee, so verifying that none of the 104 
projects financed by this Programme in 1996 received assistance from the Cohesion Fund. 
4.6.4 EUROPEAN INVESTMENT BANK 
The EIB sometimes provides substantial assistance to the Cohesion countries to finance 
projects in areas similar to those covered by the Cohesion Fund. The ad hoc system for the 
exchange of information on applications for assistance submitted by the Member States 
between the Commission and the Bank established in 1993 is continuing to work effectively. 
The EIB routinely consults the Commission and the Cohesion Fund when it receives a loan 
application. 
These regular exchanges of information first of all establish that the ceilings for EIB loans are 
not exceeded and secondly ensure a sound combination of grants and loans for the projects 
being part-financed. 
A series of major projects has now been approved by the Commission under the Cohesion Fund 
and, during the same year, granted a loan by decision of the Bank's Board of Directors. 
The financing arrangements and the economic, technical and financial evaluation of the project 
are carried out with full cooperation between the Commission and the EIB. 
This category of projects includes several examples of joint large-scale operations. In Greece 
examples include the part-financing of Spata airport, to which the Cohesion Fund granted ECU 
250 million, part-financing of the Port of Pireaus, which received grants from the Cohesion 
Fund and the EEA financial mechanism and a loan from the EIB, and improvements to certain 
motorway sections of the PATHE road. 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 124 
Part-financing in Spain usually takes the form of individual loans from the EIB to the 
Autonomous Communities accompanied by Cohesion Fund grants for environmental measures. 
Loans and grants for roads and rail projects are paid to the Ministry for certain main routes 
financed by the Cohesion Fund. 
In Portugal, during 1996 three-large-scale investments were financed jointly by the Cohesion 
Fund and the EIB, the incinerator project in Oporto (LIPOR), the incinerator project in Lisbon 
(VALORSUL) and the Nord railway line. 
The situation in Ireland is different because few EIB loans are made there (see the Bank's 
Annual Report) and loans are made to finance a series of projects in the form of a global loan to 
the Ministry responsible. 
The EIB has made individual loans for the modernisation of signalling on the Dublin-Belfast 
line. 
4.6.5 EEA FINANCIAL MECHANISM 
Set up under the agreement on the European Economic Area (EEA)", this financial mechanism 
closely parallels the Cohesion Fund in its scope and geographical coverage, although it is 
considerably smaller in terms of resources. The mechanism is financed by the former EFTA 
member countries of the EEA (Austria, Sweden, Finland - which have in the meantime joined 
the EU - and Norway, Iceland and Liechtenstein), and is managed on their behalf by the EIB. 
Assistance from the mechanism is available for eligible schemes which promote economic and 
social cohesion in Portugal, Greece, the Republic of Ireland, Northern Ireland and the Objective 
1 regions of Spain. 
The EEA financial mechanism runs for a period of five years (1994-99) and can provide direct 
grants and interest rebates on loans. Priority is given to projects which place particular 
emphasis on the environment, transport (including transport infrastructure) and education and 
training. Both public and privately financed projects are eligible, with preference among the 
latter given to those promoted by small and medium-sized enterprises. The mechanism's budget 
amounts to ECU 500 million in the form of grants, and interest rebates on EIB loans of up to 
ECU 1.5 billion. 
The EEA financial mechanism clearly presents a potential source of overlap with the Cohesion 
Fund given its sectoral and geographical coverage. In geographical terms the main differences 
are that the mechanism applies in Northern Ireland, whereas it does not apply in the non-
Objective 1 areas of Spain. In sectoral terms the EEA mechanism has a wider coverage, but it 
can also finance transport infrastructure projects and environmental projects similar to those 
assisted by the Cohesion Fund. 
In practice, however, the small size of the mechanism limits the risks of overlap. Moreover, the 
arrangements which have been put in place for its management by the EIB are intended 
specifically to ensure that projects supported are compatible with other Community policies 
Article 1 16 of the LEA agreement and Protocol 38 
Annual report of the Cohesion Fund 1996 
Chapter 4 - Assessment of the projects and measures adopted 125 
and are consistent with other financial instruments. The Cohesion Fund has an agreement with 
the EIB for the exchange of information on projects submitted for assistance, as well as for 
providing advice on projects proposed to be part-financed by means of loans and grants. The 
Cohesion Fund is thus informed of any project submitted to the EIB which might also be 
proposed for Cohesion Fund finance. 
4.7 THE ROLE OF THE EIB IN EVALUATING PROJECTS 
4.7.1 ON-GOING INSTITUTIONAL COOPERATION 
The cooperation agreement signed on 23 September 1993 under the cohesion financial 
instrument was extended by the Commission and the EIB to the Cohesion Fund. A new 
framework agreement for this purpose was signed on 15 December 1994 to apply throughout 
the life of the Cohesion Fund Regulation (until 1999). 
This framework agreement is based on the following principles: on-going exchanges of 
information, regular meetings with the EIB, use of the EIB's expertise to assess projects for 
which EIB/Cohesion Fund part-financing is requested by the promoter or the national 
authorities and the possibility of assessing projects for which no application for assistance has 
been made to the Cohesion Fund. 
After over three years' operation,' the importance and quality of this cooperation are still 
essential to the Cohesion Fund in the process of evaluating operations and the best combination 
of sources de finance (grants and loans). 
4.7.2 THE RESULTS OF COOPERATION IN 1996 
In 1996 cooperation with the EIB concentrated on 36 projects, 22 of which were sent to the 
Bank for an initial reaction. Two major projects were subjected to an in-depth evaluation and 
12 projects are being part-financed. 
Of the projects evaluated, 27 concern measures in the field of the environment, mainly 
measures to do with waste water and the treatment of urban waste. 
Eight projects in the field of transport infrastructure under the trans-European networks were 
evaluated; they concern mainly ports, airports and railways. 
Annual report of the Cohesion Fund 1996 
CHAPTER 5 - Monitoring and checks 126 
CHAPTER 5 
MONITORING AND CHECKS 
5.1 MONITORING COMMITTEES 
5.1.1 SPAIN 
Two meetings of the Monitoring Committee were held in Madrid in 1996: on 24 April and 30 and 
31 October. 
The meetings were conducted in accordance with the Committee's rules of procedure. As the 
Commission had requested, the Monitoring Committee was divided into separate committees 
depending on the body responsible for implementation of the projects concerned or the sector of 
assistance. 
Fifth meeting of the Monitoring Committee (24 April) 
This Monitoring Committee was divided into three Committees: for water projects, for Central 
Administration projects and for territorial administrations. 
The committee was chaired by Mr Angel Torres, Director-General of Planning, and attended by 
the Ministry of Public Works, Transport and the Environment (MOPTMA), the Directorate for 
Water Quality, the Directorate-General for Economic Programming and the Budget, the Planning 
Committee and bodies such as ICONA, MINER and AENA. 
The Commission Delegation, led by the Director of the Cohesion Fund, comprised the Head of 
Unit, those concerned with projects in Spain within the Cohesion Fund Directorate and 
representatives of DG XI and DG XVI-C. 
To establish the criteria for including projects in the Committee for water projects, it was agreed 
that this concept should be restricted to projects concerned with the water cycle, plus those for 
drainage and water treatment. The projects selected are therefore those concerned with the control 
networks and the L1NDE and PICHRA programmes. 
The agenda of these committees included consideration of the state of implementation of each 
project at 31 December 1995. At a general level, the Commission raised the problem of the delay 
since inception in implementing environmental and transport projects. It also noted that a large 
number of projects had been amended from the original forecasts, with regard either to the 
eligible cost, the schedule or the financing plan. 
The meeting dealt with some aspects of the rules governing participation by the local 
administrations and clarification of the relationship of Cohesion Fund projects to ERDF projects. 
On this occasion, other aspects concerning the examination, monitoring and management of the 
projects were also raised: 
0 the physical and financial indicators on the monitoring reports and applications for payment 
should in future include all expenditure shown on the breakdown of the costs of projects; 
Annual report of the Cohesion Fund 19°' 
CFIAPTER 5 - Monitoring and checks 127 
0 the final report on the implementation of a group of projects should be drawn up for each 
separate project, while the conclusions on the operational link or visible strategy might be 
combined; 
0 appropriate publicity for Cohesion Fund assistance. It was stated that the Commission would 
shortly approve a decision on information and publicity measures to be implemented by the 
Member States; 
0 an updated interpretation of the rules on payment: the work carried out and paid by the body 
responsible is still the basis for payments of expenditure by the Cohesion Fund. 
The Commission also expressed its satisfaction with the ad hoc Monitoring Committee attended 
by the administrations of the Autonomous Communities and local authorities and requested 
establishment of an ad hoc Afforestation Committee and separate committees for the 
Autonomous Communities and local administrations in the interests of more transparent 
management of the projects concerned. 
Sixth meeting of the Monitoring Committee (30 and 31 October ) 
The Monitoring Committee was divided into five sub-Committees depending on the body 
responsible for implementation of the projects concerned or the sector of assistance. As the 
Commission had requested, participation by the Autonomous Communities and local 
administrations was separated: Committee for water projects, Committee for afforestation 
projects. Committee for central administration projects, Committee for the Autonomous 
Communities and Committee for local administrations. 
The Committees were chaired by Mr Pascual Fernandez, Director-General for Analysis and 
Budgetary Programming; attendance varied depending on the committee but included the 
Ministry of Public Works, Transport and the Environment (MOPTMA), the Water Quality 
Directorate and the Directorate-General for Economic Programming, the Budget and the Planning 
Committee, bodies such as ICONA, MINER and AENA and representatives of the local 
administrations. 
The Commission Delegation, led by the Director of the Cohesion Fund, comprised the Head of 
Unit, those responsible for projects in Spain within the Cohesion Fund Directorate and 
representatives of DG XI. DG XVI-C-A and DG XX. 
The agenda of these Committees included consideration of the state of implementation of each 
project at 30 June 1996. 
• Committee for projects submitted by the Central Administration 
Within this Committee the sectors considered are, in transport, most of the road and rail projects, 
and in environment, principally drainage and water treatment, waste management and the 
restoration for the coast line. The Commission found that most projects were progressing well 
with the exception of some concerned with the restoration of the coastline. 
• Committee for projects submitted by the administrations of the Autonomous 
Communities 
The projects submitted by the Autonomous Communities cover roads, drainage and water 
treatment, waste management and the urban environment. Consideration of project 
Annual report of the Cohesion \'u\id 1996 
CHAPTER 5 - Monitoring and checks 128 
implementation gave rise to an exchange of information among those responsible for management 
at national, regional and Community level. 
The Commission found that in general project implementation was rather slow, mainly because of 
delays in the tender procedure and the award of contracts. 
• Committee for projects submitted by the local authorities 
The projects submitted by the local authorities cover drainage and water treatment, waste 
management and the urban environment. Consideration of project implementation included the 
many projects whose deadlines had been amended. 
The Commission stressed the need to speed up implementation as much as possible, despite the 
problems attendant on launching an invitation to tender and on management where projects in 
different municipalities were grouped together. 
• Committee for water projects 
The main comments arising from consideration of the implementation of these projects concerned 
changes to the date for the end of the works in some decisions. 
At the Monitoring Committees, the Commission recalled the need for precise and detailed 
information on the projects financed in this sector, the swifter submission of applications for 
payment of the balance for completed projects and the inclusion of the environmental impact 
statement in applications for aid in this sector to speed up adoption. 
• Afforestation Committee 
The projects, which are submitted by the central administration when they include a series of 
measures, are grouped by water system. 
Consideration of project implementation showed that the projects adopted in this sector will need 
an extra year because the measures in these decisions include works which, because of the 
climatic conditions, can be carried out only at certain periods of the year (October to April). 
The seventh Monitoring Committee meeting will be held in the third week of May 1997 (about 21 
and 22 May). It too will be organised in five meetings on the basis either of the sector or of the 
body responsible for implementation. 
5.1.2 PORTUGAL 
During 1996, the Monitoring Committee for Cohesion Fund projects met on three occasions, on 
26 January, 18 June and 8 October. 
At these meetings, thorough discussions concentrated on.future programming in the transport 
and environment sectors to ensure that a balance between these sectors is maintained 
throughout the period of application of the Fund. This programming is also of very great 
importance for the management of resources over the next three years since total commitments 
Annual report of the Cohesion Fund 1996 
CHAPTER 5 - Monitoring and checks 129 
cannot jeopardise the retention of a reserve of appropriations required for the application, if 
necessary, of conditionality. 
There is regular case-by-case analysis of the physical and financial implementation of projects, 
and some reprogramming decisions were taken. 
The data provided by the Portuguese authorities (held over to 30 September) showed financial 
implementation in the transport sector for 1993/96 to be quite satisfactory (98%). By the end of 
1996, 18 projects had been completed. In 14 cases the final reports had been submitted and the 
balance applied for. 
During that period, the pace of financial implementation for environment projects was slower 
(51%). By the end of 1996, five projects had been completed of which the Commission had 
closed three. 
The ad hoc Committee set up to monitor the new Tagus Bridge met in Lisbon on 26 February, 
18 July and 26 November 1996. 
The subjects covered included physical implementation of the project and environmental 
matters. 
Delays in work on land caused by the particularly severe weather conditions during the winter 
of 1995/96 were retrieved as a result of the very high rates of implementation recorded, 
particularly from May 1996. The latest estimates suggest that the work could even be 
completed by January 1998, a little earlier than expected. 
As specifically agreed in the memorandum on environmental matters signed by the 
Commission and the Portuguese Government on 15 July 1996, implementation of the 
agreement will be monitored regularly by the Monitoring Committee responsible for the 
project. 
At the last meeting of this Committee, the Commission held a discussion on the 
implementation of the conditions laid down in this memorandum on the basis of documents 
submitted earlier by the Portuguese authorities. 
This joint examination showed that the Portuguese Government had fully complied with the 
conditions of the memorandum, the deadline for which was 15 October 1996. 
5.1.3 GREECE 
The Monitoring Committee for Cohesion Fund projects met four times in 1996, that for transport 
and the environment on 27/28 March and 3/4 October and the ad hoc Committee for the Evinos 
project on 29 February and 21 October. 
The Monitoring Committee was chaired by the Secretary-General of the Ministry of the National 
Economy and comprised the Secretaries-General of the other seven Ministries involved in 
Cohesion Fund assistance, Commission representatives from the Cohesion Fund and the other 
Directorates-General concerned, representatives of the EIB, the Greek Ministries, the associations 
of local authorities and a large number of mayors in their capacity as contracting authorities. 
Annual report of the Cohesion Fund 1996 
CHAPTER 5 - Monitoring and checks 130 
The rules of procedure of the Cohesion Fund Monitoring Committee were amended to provide for 
representation of the regional and local authorities (two places) and a representative of the social 
partners. 
The Committee considered the summary tables by decision and by project and the reports on each 
project. The Commission carefully checked compliance with Community policies. In the specific 
case of major projects, the Cohesion Fund applied the horizontal guidelines on public 
procurement agreed with the Greek authorities, i.e. control on the large discounts offered by 
promoters and maintenance of the total initial cost without unjustified increases. 
The Cohesion Fund required compliance with Community environmental policy and made this a 
condition for the granting of financial assistance. 
The various meetings of the Monitoring Committee also provided an opportunity to: 
0 transmit to the authority designated by the Member State, the supervisory Ministries and the 
final beneficiaries the results of consideration of the new applications for assistance: 
0 report the amounts of commitments and payments made in 1996 for Greek projects for 
transport and the environment; 
0 hear directly the problems encountered by final beneficiaries while work was being carried 
out: 
0 state the respective positions of the Member State and the Commission on the continuation of 
the projects, the eligibility of expenditure and the information to be supplied to the 
Commission: 
0 report to the Greek authorities possible amendments to be made during 1996 to the projects 
already approved and on which the Commission was to take a decision. 
Physical and financial implementation of environmental projects during 1996 was satisfactory. 
Implementation of transport projects was satisfactory as far as the PATHE project was concerned 
but unsatisfactory from the point of view of commitments and construction for Egnatia, since this 
was a decisive year for the start of the agency. The figures from the latest Monitoring Committee 
(October) show implementation in the field of transport for PATHE and Egnatia at 67%. Now that 
the appointment of a Project Manager for Pathe means that payments have been unblocked, the 
rate of absorption will increase substantially. 
• Ad hoc Monitoring Committee 
The ad hoc Monitoring Committee for the Evinos project met twice during 1996, on 29 February 
and 21/22 October. 
This project was monitored from a physical, financial and technical point of view. The advisory 
and coordinating Council, comprising internationally renowned experts, was set up to advise at 
regular intervals on options and ensure continuation of the work and the implementation of the 
project. It was also to keep the Cohesion Fund informed. Preparation of the systematic enlarged 
final study was entrusted to the contractor. Finance was granted for measures to stabilise land 
slips definitively. A key part of the project financed by the Cohesion Fund was completed. 
However, the Fund refused to continue financing this project until the complementary studies, 
Annual report of the Cohesion Fund 1996 
CHAPTER 5 - Monitoring and checks 13 I 
particularly those on the risk of earthquakes and land slips, had been completed and their impact 
on the final design of the project approved. 
A preparatory meeting of the ad hoc Monitoring Committee for Spata, the new international 
airport at Athens, was held in October. 
5.1.4 IRELAND 
The Monitoring Committee for Ireland met three times in 1996, on 30 January, on 3 July and 
on 10 December. 
As before, the Commission was represented by the Cohesion Fund Directorate and members of 
other departments concerned and the Irish authorities by the Department of Finance, who 
provide the chairman and secretariat for the committee, and representatives of the Irish 
government departments responsible for the economic sectors receiving assistance. 
Representatives of the public agencies responsible for the implementation of projects (e.g. Irish 
Rail, the state rail company, the port authorities, Air Rianta, the state airport company) also 
attended. 
One important innovation in 1996 was the presence on the Committee of members of the local 
authorities who are responsible for the design, implementation and management of road, water 
treatment and water supply projects. 
The format and content of the information available to the committee had been substantially 
improved in 1995 and in general the Commission found the documents supplied to be 
satisfactory for the purposes of assessing the financial and physical implementation of projects 
although it was necessary on occasion to look for additional information and clarification in the 
case of some of the port and solid waste projects. 
The Commission is generally satisfied with the progress of the projects and it has not been 
necessary to suspend assistance in any case. 
Nonetheless, the Commission repeatedly indicated its concern about the increase in cost in 
many projects reported by the authorities and stated that major modifications of projects would 
only be granted if detailed justification was provided for the cost increases and only in certain 
limits. 
5.2 INSPECTION MISSIONS 
Acting under Article 12 of Council Regulation (EC) No 1164/94 the Commission carried out a series 
of measures to check the accuracy of the statements by the Member States in support of their 
applications for assistance and the existence of the administrative and accounting documents relating 
to projects which had received financial assistance from the Cohesion Fund. 
The audit missions carried out by the Commission during 1996 to monitor the management and 
sound implementation of the projects approved are summarised below: 
Annual report of the Cohesion Fund I99( 
CHAPTER 5 - Monitoring and checks 132 
5.2.1 SPAIN 
• Transport 
Missions by DG X\;I 
From 18 to 22 mars : 
* Bailén-Granada motorway (4 sections) Andalusia. No CF 94/11/65/003 
From 24 to 28 June : 
* OR1 - Rias Bajas expressway. Orense-Porriiio section. Galicia. No CF 94/11/65/002 
Missions by DG XVI accompanied by DG XX 
From 21 to 25 October : 
* Access to Santiago. No CF 93/11/65/013 
* OR1 - Rias Bajas expressway. Orense-Porriiïo section. No CF 94/11/65/002 
• Environment 
Missions by DG XTI 
From 6 to 9 February : 
* Water supply to Algodor de Tarancôn and southern Madrid. Castille-La Mancha and 
Madrid. No CF 94/1T/61/013. 
* Lorca water station. Murcia. No CF 95/11/61/037. 
* Environmental restoration. Portman Bay. Murcia. No CF 94/11/61/022. 
From 24 to 28 June : 
* Waste-water treatment in Renteria. Basque Country. No CF 93/11/61/024 
* Treatment of waste and contaminated soil in the Basque Country. No CF 95/11/61/043-7 
* Lourido coast, Portonovo and La Lanzada. Galicia. No CF 94/11/61/027-028 
From 7 to 8 October : 
* Cleaning up of River Besos. Catalonia. No CF 96/11/61/027 
From 28 to 29 October : 
* Bagès inter-municipal urban waste management. Catalonia. No CF 95/1 1/61/025-1 and 
96/1 1/61/026. 
* Rubi urban waste management. Catalonia. No CF 95/11/61/025-6 
* Gavâ-Viladecans recycling centre. Catalonia. No CF 95/11/61/022-D and 96/1 1/61/051. 
Missions by DG XVI accompanied by DG XX 
From 21 to 25 October : 
* Donana National Park. No CF 93/11/61/034 
* Restoration of beaches on Isfa Cristina. No CF 93/1 1/65/057 
From 4 to 6 November : 
Annual report of the Cohesion Fund 1996 
CHAPTER 5 - Monitoring and checks 
* Projects to check erosion in Andalusia. 
5.2.2 PORTUGAL 
• Transport 
Mission by DG XVI 
1 7 June and 26 November : 
* New Tagus bridge - 94/10/65/005 
Mission by the EIB accompanied by DG XVI 
22 July : 
* Modernisation of the Nord II line - B. de Prata/Alhandra - 96/10/65/002 
Missions by DG XVI accompanied by DG XX 
From 30 September to 4 October : 
* Port of Sines eastern road - 93/10/65/012 
* Road access to the Port of Sines Terminal - 93/10/65/026 
• Environment 
Missions by DG XVI accompanied by DG XY: 
From 30 September to 4 October : 
* Interceptors at the Beirolas, Frielas and S. Joào da Talha treatment stations -
93/10/61/013 
* Construction of Frielas and S. Joào da Talha treatment stations - 94/10/61/006-007 
5.2.3 GREECE 
• Environment 
Missions by DG XVI 
5 February : 
* Waste-water pipes in Corinth. No CF 93/09/61 /053-a 
* Waste-water treatment station, collectors and drainage network in Loutraki. CF No 
94/09/61/001-2 
26 March: 
* Waste-water pipes in Nea Makri. No CF 93/09/61/027-1 
* Drainage networks in Keratca. No CF 93/09/61/027-2 
3 October : 
Annual report of the Cohesion \\w\d 1996 
CHAPTER 5 - Monitoring and checks 134 
* Protection of groundwater Argolikon Pédion. No CF 93/09/61/009 
j 
'From 21 to 23 October : 
•f * Waste management in Thessaloniki. No CF 93/09/61/035 
W; Waste management in Schisto. No CF 93/09/61/034 
Missions by DG XX accompanied by DG XVI 
20 May : 
* Waste-water treatment station for the town of Rhodes. No CF 93/09/61 /046 
From 25 to 29 November : 
* Rain and waste-water network in Veria. No CF 93/09/61/032 
* Rain and waste-water network in Veria. No CF 94/09/61/032 ; 
* Water supply pipes in Veria and Yannitsa. No CF 93/09/61/058 
* Waste-water treatment station in Yannitsa. No CF 93/09/61/055-3 
* From I to 5 April : 
Mission to audit financial flows from the Commission to the finance departments of the 
Member State for Cohesion Fund projects. 
5.2.4 IRELAND 
• Transport 
Missions by DG XVI 
From 24 to 26 July : 
* Dublin port North quay Ro/ro berth. No CF 93/07/65/01 7 
* Ennis, Main Drainage. No CF 93/07/65/029. 
From 23 to 27 September : 
* Portlaoise by-pass No CF 94/07/65/007 
Missions by DG XX accompanied by DG XVI 
From 07 to 10 May : 
* Rail network improvement I. No CF 93/07/65/019-023-024-025 
* Cork Harbour Tug. No CF 93/07/65/013 
* Cork Passenger Ferry Terminal. No CF 93/07/65/01 5. 
• Environment 
Missions by DG AT7 
From 24 to 26 July : 
Annual report of the Cohesion Fund ll)(>6 
CHAPTER 5 - Monitoring and checks 135 
* Ballinrobe sewerage. No CF 93/07/61/027 
* Tuam Regional water supply (stage I). No CF 93/07/61/028 
From 23 to 27 September : 
* Dublin Regional Water Supply No CF 93/07/61/012 and 94/07/61/015 
Technical verification missions with the assistance of scientific consultants. 
Consultants selected for this purpose using the technical assistance provided for in the Regulation 
undertook specific missions for the technical evaluation of projects and the progress of work. 
5.3 ROLE OF THE EIB 
The Council Regulation makes specific provision for the EIB to take part in the monitoring of 
Cohesion Fund projects by stating that the Bank shall be represented on the Monitoring 
Committees set up in each beneficiary Member State. 
The EIB has participated effectively on these Committees, particularly the ad hoc Monitoring 
Committees set up for the major projects part-financed by the EIB and the Cohesion Fund 
(e.g.: the Tagus Bridge and Spata Airport). 
In addition to the cooperation provided for in the Regulation, the EIB, which has its own 
monitoring procedures for the projects it finances, provides the Commission with technical 
support for projects for which it has already financed part of the expenditure and for which the 
Member State requests a Cohesion Fund grant in addition to the loan. 
5.4 FRAUD AND IRREGULARITIES 
Article 12 of Council Regulation (EC) No 1164/94 requires the beneficiary Member States to take 
the necessary measures to prevent and take action against irregularities. In addition, they are 
responsible for recovering amounts lost as a result of irregularity or negligence. As a general rule 
Member States are also liable for the reimbursement of any sums unduly paid. 
Member States are also bound to inform the Commission of measures taken for the purpose of 
control and fraud prevention. In particular they are to notify the Commission of the management 
and control systems established and make available to the Commission any appropriate national 
control reports. By adopting in 1994, Regulation (EC) No 1831/94, the Commission issued 
detailed implementation provisions concerning the obligations of beneficiary Member States in 
connection with financing of the Cohesion Fund. This set of rules concerns, in particular, the 
organisation of an information system in the area of irregularities. In order to provide an incentive 
for Member States not to let go of the reins the Commission may make a contribution to the legal 
cost incurred by a Member State for legal proceedings in recouping sums wrongly paid. 
In 1996, as in earlier years, the Commission has received no reports of fraud or irregularity in 
connection with projects approved under Council Regulation (EC) No 1164/94. The Commission, 
did not therefore need to open detailed investigations into projects assisted by the Cohesion Fund. 
Annual report of the Cohesion Fund 1996 
CHAPTER 5 - Monitoring and checks 136 
On the other hand, the Commission, from its regular monitoring and control visits, is not yet 
entirely convinced that Member States have fully grasped the importance of tlfeir responsibilities 
in the context of the above regulations. It therefore continued, during 1996, its information 
seminars in order to increase awareness of the administrations and to exchange experiences. 
During its control and verification visits the Commission services have discovered some cases of 
negligence and irregularities, in Greece, Ireland and Portugal, that may arise partly from a 
misinterpretation, misunderstanding or unfamiliarity with rules applied by the Commission. 
In the course of a verification visit to Greece the Cohesion Fund discovered that payment claims 
issued on a particular project were not based on payments actually made. The Cohesion Fund has 
informed the Greek Ministry for Economics which is in charge of implementation and follow up 
of Cohesion Fund assisted projects. In the meantime the authorities responsible have adhered to 
the Commission view, and payment requests presented to the Commission are now based on 
payments made. 
In 1996, the Commission gave the Portuguese authorities warning notice as a result of an 
inspection of the CRIL (Lisbon outer ring road) project (No 93/10/65/025) carried out in 1995. 
In the course of a verification visit to Ireland it became obvious that, for the project in question, 
point 3 of the Financial Implementation Provisions that are appended to project decisions has not 
been fully respected. The Ministry for the Environment has started an investigation into the case. 
In a second case the Cohesion Fund had to interrupt payment to a waste-water project as a result 
of a request from the Commission environmental service. The Commission had grounds for 
believing that Community environmental legislation had not been respected during 
implementation of the project. Both cases are pending. 
55 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 1164/94. 
5.6 SOUND AND EFFICIENT MANAGEMENT (SE1VD 
The Commission, under the SEM 2000 action programme, has intensified its dialogue with 
Member States in order to improve financial management of the Community budget. The 
Cohesion Fund management, in parallel with a similar effort undertaken for the Structural 
Funds, has elaborated a set of rules governing eligibility of expenditure. The objective was to 
harmonise as far as possible with the principles applied in the Structural Funds, while taking 
account of the particular features of the Cohesion Fund. Once the agreement of the financial 
departments and the Commission's Legal Service has been obtained, the principles will be 
notified to the beneficiary Member States in early 1997. It is anticipated that codified and clear 
principles will further enhance transparency of operations administrated by the Fund and will 
raise the awareness of the national authorities of the principles of eligibility and other 
fundamental issues relevant for efficient management. 
Annual report of the Cohesion Fund 1996 
CHAPTER 6 - Interinstitutional dialogue, information and publicity 137 
CHAPTER 6 
INTERINSTITUTIONAL DIALOGUE, INFORMATION AND PUBLICITY 
6.1 ANNUAL REPORT TO THE EUROPEAN PARLIAMENT. THE COUNCIL. 
THE ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF 
THE REGIONS 
Article 14 of the Cohesion Fund Regulation requires the Commission to present an annual 
report on the activities of the Fund for examination and opinion to the European Parliament, the 
Council, the Economic and Social Committee and the Committee of the Regions. The annual 
report covering the year 1995 was duly presented on 4 September 1996 to these institutions. 
It should be recalled that Annex II to the Cohesion Fund regulation lays down detailed 
requirements concerning the information which must be included in the annual reports. Using 
this framework, it has been possible to develop a constructive dialogue between the institutions 
and the Commission has had the opportunity to refine and adjust the presentation of the 
information according to the wishes and concerns expressed in the different opinions. 
However, on a certain number of proposals concerning decision-making and Fund management 
made in particular by the Parliament and the Committee of the Regions, the Commission has 
had to recall that the implementation of the Cohesion Fund must necessarily be in complete 
conformity with the provisions of the Regulation; similarly a suggestion from the commission 
of the Economic and Social Committee dealing with the annual report to limit information 
about projects has not been pursued as the annual reports must serve a multitude of purposes 
and therefore be as complete as possible concerning information on projects. 
On a number of occasions during the year, Commission representatives have had the possibility 
of informing members of the institutions and discussing specific items with them. Such 
discussions concerned the conditionality procedure and the results of the mid-term review in 
particular, as well as fund management, information-and publicity measures and assessment of 
effects in general. 
6.1.1 THE EUROPEAN PARLIAMENT 
The opinion drafted on the 1995 annual report (Novo report EP 219.991) noted a series of 
positive comments and remarks concerning the implementation of the Cohesion Fund, and in 
particular budgetary implementation. The European Parliament expressed satisfaction at the 
near-100% implementation rates for commitment and payment appropriations during the 
budget year and reiterated the positive comments concerning the absence of detected fraud in 
Cohesion Fund projects. 
Support was given to the objective of the 50-50 split of budgetary resources between the two 
sectors of investment for each of the Member States concerned and for the whole period 
covered by the Cohesion Fund Regulation. 
Concerning the allocation within the two fields of assistance. Parliament noted that the number 
of projects concerning treatment of solid waste was too low in the environment sector. At the 
Annual report of the Cohesion fund 1996 
CHAPTER 6 - Interinstitiitional dialogue, information and publicity 138 
same time there was regret that roads continue to account for too much of the transport sector. 
Parliament also called for more attention to be given to the fact that air and sea transport are of 
great importance to the more remote areas. 
Parliament welcomed the Commission's attempts to assess the socio-economic impact of the 
projects funded. In this respect it should be recalled that the techniques developed for this 
purpose for the Commission are intended to help quantify job-creation and economic growth 
effects and that the models which are now operational may also serve to assess other major 
investments, e.g. those part-financed under Structural Fund programmes, in particular by the 
ERDF. 
Criticism was levied at the composition of certain Monitoring Committees and at some aspects 
of the arrangements for cooperation with other financial bodies in assessing and monitoring 
projects; the Commission took note of these remarks but reiterates that the Fund Regulation 
must be fully respected. 
6.1.2 ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE 
REGIONS 
The number of points raised by the two bodies on the 1995 report was considerably smaller 
than in previous years. This is no doubt due to the fact that the Commission has taken account 
of many earlier suggestions - not least concerning the number of Monitoring Committee 
meetings, the selection of projects and the balance between the two sectors of assistance - as 
well as the better understanding of the special characteristics of the Cohesion Fund gained by 
the two bodies during the initial years of implementation. Clearly there is an excellent rapport 
between the Commission as Fund manager and the bodies representing the social partners and 
the Regions. 
There is satisfaction at the increased involvement of the social and local partners although 
room still exists for improvements. The analysis of the impact on jobs of Cohesion Fund 
projects was an early request by both bodies and the European Parliament as well; many 
positive remarks and requests for further development of these tools were forthcoming. 
The Economic and Social Committee expressed disappointment that the annual report had not 
been made available earlier due to the large amount of information on individual projects 
contained in it. It is hoped that future reports can be more quickly transmitted to the other 
institutions. 
6.2 INFORMATION TO THE MEMBER STATES 
The Member States are kept informed of the activities of the Cohesion Fund through a series of 
well-established information meetings. These normally take place twice every year, in 1996 on 
31 May and on 13 December. 
At the meeting in May the Member States' representatives heard a presentation by Mr 
Landiiburu. Director-General for Regional Policy and Cohesion, on the current work of the 
Fund and its implementation, including the principle of conditionality and the so-called mid­
term review of the GNP-critcrion, i.e. the question of whether the Member States continue to be 
Annual report of the Cohesion Fund 1996 
CHAPTER 6 - Interinstitutional dialogue, information and publicity 
eligible for Cohesion Fund support in view of their Gross National Product compared to the 
Community average (see section 1.1.2 of this Report). An updated listing of projects was 
available at the meeting as well as the first draft of the 1995 annual report on the activities of 
the Fund. Attention was given in particular to the ongoing efforts to assure an equal distribution 
of the financial resources of the Fund between the two sectors of assistance and the financial 
implementation of the budget available. 
To the December meeting agenda was added - in addition to the now familiar points concerning 
current activities and current project financing - a special point on information and publicity 
measures, following the Commission decision in this area (see Section 1.1.3 of this Report). 
The Member States were given an audio-visual presentation of the salient points of the decision 
and a few examples of how the obligations of the authorities of the beneficiary Member States 
may respond to the obligations of publicity and information on investment projects. 
6.3 INFORMATION TO THE SOCIAL PARTNERS 
Two meetings were held with the social partners (UNICE, CES, CEEP and 
EUROCHAMBRES) during 1996: on 20 February and 11 September. On both occasions, the 
projects adopted to date and the perspectives for the rest of the year were at the centre of 
discussions; information and data on the Cohesion Fund activities during the entire three years 
of operation also made it possible to discuss general questions relating to Fund priorities, the 
balance between sectors, the socio-economic impact of financing and employment effects. 
These meetings are a welcome possibility for the Fund management to hear the points of view 
of those who are. if not directly, then at least indirectly involved in the projects, often as sub­
contractors, suppliers, consumers or representing the two sides of industry. 
6.4 OTHER INFORMATION EVENTS 
The Cohesion Fund organised information measures in the four Cohesion countries. These are 
set out in detail below. 
Training measures on the Fund were organised jointly with the Commission Offices in the 
Member States. 
These measures are intended to provide information on the Fund, such as access to grants and 
the provisions concerning information and publicity. They are also intended to help those 
responsible for projects to improve their preparation of applications for aid to the Fund, 
improve the financial management of the projects part-financed and so facilitate and speed up 
the management of files. 
* 19.3.1996: Cohesion Fund presentation to EU Heads of Office in the Member States 
* 20.3.1996: Information and Publicity presentation to Parliament's Regional Committee 
* 25-26.4.1996: Madrid; Cohesion Fund presentation to Spanish Local Authorities 
* 21-22.5.1996: Rhodes; Training Measure Programme - UCLAF/Cohesion Fund 
* 14.6.1996: Eindhoven, Conference on "Innovative Financing opportunities for European 
Biodiversity" 
* 28.6.1996: Information and Publicity Measures information meeting for Member States 
Annual report of the Cohesion Fund 1996 
CHAPTER 6 - Interinstitutional dialogue, information and publicity 140 
3-4.10.1996: Killarney, Ireland; Training Measure Programme - UCLAF/Cohesion Fund 
23-24.10.1996: Lisbon; Training Measure Programme - UCLAF/Cohesion Fund 
29.10.1996: Madrid; Seminar on Information and Publicity measures 
5-6.11.1996: Oslo; Seminar on EU Regional Politics and Cohesion - Presentation of the 
Cohesion Fund and Cohesion policy to the Federation of Norwegian Industry. 
6.5 COMMISSION PUBLICITY AND INFORMATION MEASURES 
The Commission undertook several publicity measures of intended to fulfil the objectives of 
the general decision (see Chapter 1). In particular a photo-folder was published in English, 
French and German with introductory descriptions of selected Cohesion Fund projects in all the 
four Member States concerned and in both sectors of activity (environment and transport 
infrastructure). This publication was given wide distribution and is being used as the "business 
card" of the Cohesion Fund in seminars, conferences and other external presentations. As more 
and more projects are inaugurated this publication will be updated with new information; the 
text will, however, remain short and non-technical, the main emphasis being on the 
photographic images of projects. 
The Cohesion Fund also contributed to other publications on Regional Policy and Cohesion 
printed by DG XVI. The European Regional Development Fund edits a series of publications, 
some general and some on specific themes of importance to cohesion. With its particular range 
of eligible sectors and Member States, the Cohesion Fund is.included in these publications 
whenever it has a natural place and contributes to the subject discussed. 
The annual report was published in a convenient format and was also summarised in the 
Inforegio series of newsletters edited by DG XVI-ERDF. 
Ad hoc material is produced for specific events such as presentations and conferences using 
graphic design by computer, audio-visual material and printed matter. 
Annual report of the Cohesion I unci 1996 


ISSN 0254-1475 
COM(97) 302 final 
DOCUMENTS 
EN 13 01 
Catalogue number : CB-CO-97-290-EN-C 
ISBN 92-78-21443-4 
Office for Official Publications of the European Communities 
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