Opinion of the Committee of the Regions on 'Independent local and regional authority initiatives as instruments of regional policy in a competitive Europe'
Date: 1999-09-16
Institutions: European Committee of the Regions, Provisional data
Subjects: competition, competitiveness, municipality, region, regional policy, single market

23.12.1999

EN

Official Journal of the European Communities

C 374/51

Opinion of the Committee of the Regions on ‘Independent local and regional authority initiatives
as instruments of regional policy in a competitive Europe’

(1999/C 374/13)

THE COMMITTEE OF THE REGIONS,

having regard to its Bureau’s decision of 10 March 1999 to draw up, in accordance with the fourth
paragraph of Article 198c of
the Treaty establishing the European Community, an opinion on
independent local and regional authority initiatives as instruments of regional policy in a competitive
Europe, and to assign the preparation of this opinion to Commission 1 for Regional Policy, Structural
Funds, Economic and Social Cohesion, Cross-Border and Inter-Regional Cooperation;

having regard to the draft opinion (CdR 108/99 rev. 2) adopted by Commission 1 on 30 June 1999
(rapporteur: Mr Menacher, mayor of Augsburg, Committee member, German Association of Cities,
D/PPE),

adopted the following opinion at its 30th plenary session of 15 and 16 September 1999 (meeting of
16 September).

1.

Introduction

The European Union’s structural policy seeks to reduce
1.1.
economic and social disparities between the regions. The sixth
periodic report on the social and economic situation and
development of the regions of the European Union (1) confirms
the trend towards growing convergence identified in the earlier
periodic reports and in the cohesion report. Overall, Structural
and Cohesion Fund activities undertaken in previous funding
periods may be considered a success. They provide effective
back-up for national and regional policies to assist less viable
regions.

1.2.
However, this positive development cannot conceal
the persistence of considerable regional disparities. One indi-
cator for this is the continuing high levels of unemployment
in the Union. Unemployment varies widely from region to
region, with the weaker regions particularly hard hit. Thus, the
local, regional,
biggest challenge for structural policy at
national and European level is to foster an environment which
helps create lasting jobs.

2. Changed conditions of economic policy

2.1.
The planned eastward enlargement will give the Euro-
pean Union a fundamentally new profile, bringing the vision
of a united Europe within our grasp. At the same time,
integrating new Member States will have a major impact on
the economies of the current members. Local and regional

(1) SEC(1999) 66 final.

authorities will be seriously affected as they face growing
regional competition in a Europe that
is becoming ever
more closely knit. This applies not least to the drive for
modernization and the implications this will have for regional
employment potential.

2.2.
Eastward enlargement, a logical consequence of the
European unification process, is taking place against a back-
drop of increasing globalization of the world economy. New
communication channels make it possible to transmit vast
amounts of data across the world instantly and are set to
network virtually all the political, economic and social players
in the industrialized world. These developments will have a
direct impact on the EU’s regions and localities, placing the
onus particularly on them both as engines of sustainable
economic growth, and because of their closeness to the man
in the street.

3. Strategies to strengthen regional and local authorities

in a competitive Europe

3.1.
The developments outlined above have broadly been
taken into account in Structural Fund planning for 2000 to
2006. In this context, fostering sustainable regional growth
and boosting regional competitiveness are considered appro-
priate ways to harness the employment potential of the regions
and to create and maintain viable jobs. Jobs are deemed viable
when they are generated within a framework of economic
development which is committed to the idea of sustainability.
the common key factors of sustainable
In this context,
development
economic
efficiency and social solidarity.

environmental

protection,

are

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3.2.
Given the financial challenges of eastward enlargement,
it was decided under Agenda 2000 to concentrate limited
resources and consistently target their use on supporting the
most needy regions. This aim is also implied in the Com-
mission’s call to all local and regional authorities to shoulder
more responsibility for themselves, regardless of whether they
are designated as support areas or do not enjoy Objective
region status. With the subsidiarity principle in mind, this also
means that all local- and regional-level players must be aware
of the part they can play in balanced regional development.

3.3.
This idea has been expressly promoted by the European
Commission (see inter alia Article 10, ERDF). As far as regional
and local authorities are concerned,
the new departures
involved may be a way of taking original, exemplary action on
the development policy front. With an eye to the associated
objective of job creation, a key role should be played not only
by Community initiatives but also by the new Objective 3.
Objective 3 should be seen as an effective means of backing
up innovation strategies at local and regional level, thereby
strengthening local employment potential. Local and regional
authorities are indeed fully-fledged actors in safeguarding
employment, particularly by encouraging a business-friendly
environment. The new ESF regulation includes a measure for
promoting local employment initiatives. It would therefore
be desirable for the new Objective 3 to contribute to the
development of new sources of employment, to the promotion
of local employment and to territorial pacts for employment.

3.4.
Independent local and regional authority initiatives are
already under way today both within and without the ambit
of the Structural Funds. Here, independent initiatives are taken
to mean the targeted networking of expertise from the fields
of politics, administration, industry, research, development,
education and training. Their common purpose is to foster
sustainable economic development in ways that benefit the
people of the region and help create lasting employment.

3.5.
Despite differences of approach, these independent
initiatives should gear their course of action to the objectives
set out by the European Commission in its guidance for
programmes in the period 2000-2006 (1):

a) boosting the competitiveness of regional economies in

order to create new, sustainable jobs;

b)

increasing employment and social cohesion;

c) promoting urban and rural development in the context of

a balanced European area.

Ideally,

the implementation of

3.6.
such independent
regional and local authority initiatives should be accompanied
by the creation of so-called ‘centres of excellence’. Centres of
excellence target high-level knowledge, skills and technical
and administrative infrastructure on one viable, sustainable
economic sector. High concentration of key skills in one
specific sector and region is a factor in the location of centres
of excellence.

independent

The success of

3.7.
initiatives and the
accompanying emergence of centres of excellence is largely
due to the broad-based networking of — as far as possible —
all
local- and regional-level decision-makers. Not only can
networking generate synergistic benefits, but in the implemen-
tation of regional development strategies, it also makes for
efficiency and secures acceptance.

4. Using instruments of regional policy to boost competi-

tiveness

The primary purpose of independent local and regional
4.1.
initiatives is to boost competitiveness. Following the same line
as the OECD, competitiveness is deemed to be ‘the ability of
companies,
industries, regions, nations and supranational
regions to generate, while being exposed to international
competition, relatively high income and employment levels.’

4.2.
No satisfactory way has yet been found to present
competitiveness empirically as a measurable unit, particularly
when comparing different regions to determine relative com-
petitiveness. As the Commission rightly points out in its sixth
periodic report on the social and economic situation and
development of the regions of the European Union, studies in
this field are of limited use. Nevertheless, such studies do
constitute a first step towards identifying cause and effect in
this area, and, as such, can help assess potential competi-
tiveness. (2)

4.3.
The competitiveness of companies, research bodies,
educational establishments and public administration is a core
element in regional economic prosperity and in generating
and maintaining high levels of employment. In models drawn
up in a bid to explain the various different facets of competi-
tiveness, research and technological development (RTD) are
considered particularly important for the establishment of
centres of excellence. Successful RTD activities must not,
however, be viewed in isolation. They must be part of a raft of
measures which can improve transport and telecommuni-
cations infrastructure, upskill the working population and thus
enhance long-term local and regional competitiveness.

(1) European Commission: The Structural Funds and their coordi-
nation with the Cohesion Fund: Guidelines for programmes in the
period 2000-2006 (COM(1999) 344 final).

(2) The most recent EURICUR study also touches on this issue:
European Institute for Comparative Urban Research, Growth
Clusters in European Metropolitan Cities: A New Policy Perspec-
tive, Erasmus University, Rotterdam, 1999.

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independent

4.4.
RTD activities feature strongly in the business and
production structures of the most competitive regions. As the
European Commission notes, successful regions generally
pursue a strategic approach to innovation, which is the
mainstay of
initiatives. This includes giving
support to companies to enable them to pool their own
resources and experience with those of government agencies,
research bodies, higher education and training establishments,
economic development associations and other companies.
Such an approach makes for the more effective use of new
technologies and creates an environment conducive to RTD
and product and process innovation. The aim is to generate a
critical mass of RTD potential in the regions.

4.5.
Political decision-makers play a key role in independent
local and regional initiatives. They are responsible for defining
clear political priorities for the parameters which underpin the
development of an effective RTD environment:

a)

fostering innovation (new financing methods, new partner-
ship models,
technology-transfer
agencies, business incubators etc.);

establishment

of

b) networking;

c) upskilling workers;

d)

taking the lead (sometimes in conjunction with other
decision-makers).

4.6.
It is thus the task of local and regional authorities to
initiate a culture of innovation and excellence and to network
the players involved on a wide scale. Independent local and
regional RTD initiatives are thus a way to identify innovative
potential and develop it so as to create new jobs.

5. Centres of excellence in Europe

5.1.
Over the past few years, independent initiatives have
been launched in various European regions both inside and
outside eligible Objective areas. At regional level, this has led
to the formation of ‘clusters’ in certain sectors, which may be
termed centres of excellence. Although clusters such as these
are sector-specific, they can nonetheless become the driving
force throughout the whole economic environment.

5.2.
The purpose of this opinion is to launch a broad-based
exchange of experience and views on the various approaches,
and to show how the proposed projects can serve as a model
for other regions and localities in order to strengthen their
competitiveness and employment potential.

5.3.
COR Commission 1 opened its series of seminars
entitled ‘Implementation of the reform of the Structural Funds
— 2000-2006 — the contribution of local and regional
authorities’ in Augsburg on 8 June 1999. In the light of the
issues considered in the opinion, this initial seminar presented
and discussed a range of different approaches from indepen-
dent local and regional initiatives. The seminar conclusions,
which are appended to this opinion, provide an overview of
the initiatives put forward at the meeting as examples from
various European regions and local authorities.

6. Conclusions

6.1.
The Committee of the Regions feels that prime import-
ance must be attached to fostering the endogenous potential
of the regions in order to boost their competitiveness. This is
an essential ingredient for achieving the goals set out in the
employment policy guidelines for 1999 (1) and for creating
new, long-term jobs in the regions and localities.

6.2.
The Committee of the Regions recognizes that, to date,
European Structural and Cohesion Fund assistance has done
much in the pursuit of this goal. In many regions and localities,
EU support has helped launch successful development strat-
egies, designed in the long term to generate self-sustaining
regional growth and higher levels of employment.

6.3.
The COR notes that the success of European structural
policy is due in no small measure to the efforts of the regions
and local authorities themselves. Scope for independent action,
combined with European structural support and support from
the Cohesion Fund, ensures that regional policy objectives can
be achieved effectively and efficiently in all regions and
localities.

their own ‘on-the-ground’

The Committee of the Regions calls on the European
6.4.
Commission to ensure that, in future too, against a backdrop
of genuine subsidiarity, local and regional authorities retain
scope to implement
initiatives
effectively as instruments of regional policy. European compe-
tition rules must be flexible enough to ensure that each region
can conduct effective regional structural policy and foster
independent initiatives. Alongside readiness and ability to
innovate, however, it is also important that sound infrastruc-
tures are maintained within each territorial unit to enable local
and regional authorities to back up sustainable economic
development in their areas.

The COR would ask the Commission to draw up
6.5.
detailed, scientifically based studies or, where these already
exist, to consolidate them, taking into account the issues
discussed in this opinion. Given changing economic con-
ditions, it would seem logical, particularly as far as demonstrat-
ing good practices is concerned, to make the findings of such
studies available to all regional and local authorities and to
encourage their dissemination.

(1) Council Resolution of 22 February 1999 on the employment

policy guidelines for 1999 — OJ C 69, 13.3.1999, p. 2.

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6.6.
The COR would also encourage the active promotion
of exchanges between regional and local authorities, the main
objective being to further expand and build up European-level
networks. Multiplying networks
and experience-sharing
forums will in turn enable local and regional authorities to
multiply their independent initiatives; in this way, they will

also be in a position to ensure better complementarity between
such initiatives within the European Union. The Interreg
Community initiative, which has been widened and restruc-
tured, should be a key tool to carry through and back up such
exchanges of experience. Another useful and logical move
might be to set up a suitable Internet forum.

Brussels, 16 September 1999.

The President

of the Committee of the Regions

Manfred DAMMEYER

APPENDIX

to the Opinion of the Committee of the Regions

Conclusions of the Commission 1 seminar on independent local and regional authority initiatives as
instruments of regional policy in a competitive Europe, held in Augsburg on 8 June 1999

The COR Commission 1 series of seminars entitled ‘Implementation of the reform of the Structural Funds
1.
— 2000-2006 — the contribution of local and regional authorities’ opened in Augsburg on 8 June 1999. The
purpose of this seminar was to present and discuss independent initiatives from various different European Union
towns, cities and regions.

1.1.
Analysis of the factors influencing the competitiveness of local and regional authorities produced varied
results. The issues addressed, however, are representative of the position in most European regions and local
authorities.

1.1.1.
Infrastructure in its broadest sense must be seen as the basic precondition for any kind of sustainable
economic development. In terms of business location, infrastructure requirements are expected to become less
significant as a factor of interregional competition once ongoing developments in this field have broadly converged
at a high level. This process is still under way.

1.1.2.
Increasingly, other elements are becoming more important as regional success factors in a competitive
Europe. These include, in the first place, innovation, reflected in the regions, for instance, in the number of patent
applications and new business start-ups. Appropriate structures must be set in place in local authorities and regions
to harness and further expand innovation potential. This applies in particular to research and development activities,
education and upskilling.

1.1.3.
The networking and involvement of all relevant decision-makers at local and regional level must — together
with new forms of cooperation among the economic and social interest groups — be seen as keys to success in a
competitive Europe. There should be some attempt here to make the hierarchical relationship between the different
decision-making levels (local, regional, national and European) less rigid. We should work towards achieving
complementarity between the various tiers.

The independent initiatives put forward as part of the seminar set out lines of approach for securing a

1.2.
successful place in a competitive Europe.

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1.2.1.
The example of the city and region of Eindhoven in the Netherlands clearly demonstrated how European
structural policy can successfully be linked to independent regional initiatives. Thanks to the efficient use of European
structural assistance (the Stimulus programme, promoted under Objective 2), in conjunction with national and
regional co-financing, it has been possible to establish a critical mass of companies and research and development
agencies in the field of mechatronics. The resultant diversification of business structures in the region has led to a
sharp drop in unemployment over the past few years. It will be interesting to track the impact of phasing-out — to
be completed by 2006 — on this dynamic development process.

In implementing new development strategies, a key consideration for regions and local authorities should
1.2.2.
be to reinforce home-grown potential. This means that regions should analyse their strengths and weaknesses and
consciously continue to build on their strengths. In this respect, it is particularly important to take account of the
identity of a region as it is fixed in people’s minds.

A prime example put forward in the field of tourism was the Rovaniemi region in Lapland, Finland, and
1.2.2.1.
its Christmas Triangle project. This area has managed to assimilate difficult climatic and natural conditions into a
tourism scheme which successfully markets the Christmas theme all year round.

The structurally weak Kalmar region of Sweden has been given a new profile by specialising in the music
1.2.2.2.
and events industry, in conjunction with the use of new media. With Swedish government backing, operations
developed since the early 1980s are to continue to be built on to create a high-tech centre for music production and
the staging of special events (Rock’n Roll City). Another key element here is the establishment of appropriate
infrastructure for research and upskilling.

1.2.3.
The success of independent initiatives rests not least on the scope available to launch and implement
effective regional development measures locally. This requires extensive decentralisation of the remit for regional
policy action and decision-making.

The environmental centre of excellent established in the German region of Augsburg-Swabia is based on
1.2.3.1.
such an approach. The targeted establishment or relocation of environmental research and administrative agencies
has enabled the region to build on its existing strengths in the environmental technology sector in such a way that a
broad network of expertise in this field is now established there. A contact point has been set up to provide close
organisational links between partners from politics, business, research and science. Such a structure also secures
broad acceptance and transparency for the project in the private sector, as witnessed, for example, by the successful
establishment of an innovation centre for environmental technology.

1.2.3.2.
The main focus of the Parque Tecnologico Industriale Romano project in Rome, Italy, is to put together an
environmental science park. The main purpose of this park will be to establish the idea of sustainable urban
development in the minds of all players in society and thus, in the medium- to long-term, to give the city and region
a common new identity. One of the key challenges which has thereby to be addressed at regional level is how to
redefine, in large conurbations, the traditional relationship between cities and their surrounding areas.

1.3.

To sum up, features of successful independent local and regional initiatives include:

a) broad-based networking of all players and decision-makers and full use of the potential synergistic benefits that

implies;

b)

c)

d)

a shared desire to cut a distinctive image in a particular sector, with aggressive marketing of the operations
involved;

the ability to recognise and tap into the region’s existing potential;

and finally, the willingness to provide an open forum for new ideas and thus to take consistent advantage of
opportunities.