COMMUNICATION FROM THE COMMISSION The outermost regions of the European Union: towards a partnership for smart, sustainable and inclusive growth
Date: 2012-06-20
Institutions: European Commission
Subjects: EU regional policy, climate change, competitiveness, peripheral region, regional aid, regional integration, single market, social development

EUROPEAN COMMISSION 

Brussels, 20.6.2012  
COM(2012) 287 final 

COMMUNICATION FROM THE COMMISSION 

The outermost regions of the European Union: towards a partnership for smart, 
sustainable and inclusive growth  

{SWD(2012) 170 final} 

EN 

   EN 

 
 
 
 
  
 
COMMUNICATION FROM THE COMMISSION 

The outermost regions of the European Union: towards a partnership for smart, 
sustainable and inclusive growth  

2 

 
 
 
 
1. 

2. 

3. 

4. 

Introduction...................................................................................................................4 

Developments in the European Strategy for the outermost regions .............................4 

Axes of the renewed EU Strategy.................................................................................6 

Proposals for the future.................................................................................................6 

4.1. 

 Internal dimension .......................................................................................................6 

1) Cohesion policy ..........................................................................................................6 

2) Traditional sectors ......................................................................................................6 

3) Emerging sectors ........................................................................................................6 

4) Developing entrepreneurship......................................................................................6 

5) Integration in the single market ..................................................................................6 

6) Protecting the outermost regions' environment ..........................................................6 

4.2.  

External dimension .......................................................................................................6 

5. 

Conclusion ....................................................................................................................6 

3 

 
 
 
 
1. 

INTRODUCTION 

The  present  Communication  sets  out  how  the  Commission  plans  to  work  in 
partnership  with  the  outermost  regions1  (OR)  for  smart,  sustainable  and  inclusive 
growth. The Council 2 has stressed that the Europe 2020 Strategy with its three main 
priorities,  namely,  developing  an  economy  based  on  knowledge  and  innovation, 
promoting  a  more  resource  efficient,  greener  and  more  competitive  economy  and 
fostering a high-employment economy, and delivering social and territorial cohesion, 
should  be  fully  applied  in  the  outermost  regions  taking  into  account  their  special 
characteristics  and  constraints.  The  Council  recognised  "the  need  for  a  balance 
between  measures  to  offset  the  specific  and  permanent  constraints  of  the  outermost 
regions on one hand and those that aim to promote their advantages and opportunities 
on the other".   

The  aim  is  to  help  the  OR  become  more  self-reliant,  economically  more  robust  and 
better able to create sustainable jobs, by capitalising on the unique assets they possess 
and  their  added  value  for  the  EU.  As  recognised  in  Article  349  of  the  TFEU, 
important  constraints  will  always  remain,  such  as  remoteness  from  continental 
Europe.  However  a  concerted  effort  to  reform,  modernise  and  diversify  their 
economies - which have been heavily affected by the global economic and financial 
crisis - will be the best way to ensure a more prosperous future for the OR.  

Each OR is different and distinctive ways forward need to be designed for each one.  
The renewed strategy set out here outlines opportunities for all outermost regions, but 
each  region  will  need  to  design  its  own  path  to  greater  prosperity,  according  to  its 
specific characteristics.    

While  some  specific  OR  support  instruments  have  shown  their  value,  OR  are 
sometimes best supported by adaptations of EU rules or by taking into account their 
specific  needs  at  the moment of implementation. This strategy seeks  to demonstrate 
how the OR can find their place in the many initiatives that are supporting delivery of 
Europe  2020,  with  much  more  comprehensive  attention  to  the  situation  of  the  OR 
across the European policy spectrum than seen in the past.   

Unique assets and added value   

1 

2  

According to Articles 349 and 355(1) of the Treaty on the Functioning of the European Union 
(TFEU), as modified by the European Council Decision of 29.10.2010  amending the status of 
Saint-Barthélemy,  there  are  eight  "outermost  regions"  of  the  EU:  the  four  French  overseas 
departments and regions (Guadeloupe, French Guiana, Martinique, Réunion) and one overseas 
collectivity (Saint Martin); the two Portuguese autonomous regions (the Azores and Madeira); 
one Spanish Autonomous Community (the Canary Islands). Under Art. 355(6) TFEU, France 
has  made  a  formal  request  to  the  European  Council  to  change  the  EU  status  of  Mayotte, 
currently among the overseas countries and territories, to become an OR from January 2014. 

3023rd FOREIGN AFFAIRS Council meeting, 14 June 2010.  

4 

 
 
 
 
 
 
 
 
 
                                                 
 
 
Any  strategy  for  the  OR  must  recognise  their  value  for  the  EU  as  a  whole.  Their 
geostrategic locations mean they serve as ambassadors for the EU in the Atlantic, the 
Caribbean  and  the  Indian  Ocean,  with  the  potential  to  benefit  the  EU  through  their 
relations with their neighbours and to spread EU influence in their regions.   Despite 
their  handicaps,  the  OR  possess  many  potential  drivers  of  growth  based  on  their 
specific  characteristics.  They  account  for  over  half  of  the  exclusive  economic  zone 
(EEZ) of the EU, with a potential reserve of marine resources measuring close to 15 
million km². This represents a unique deep-sea laboratory for EU exploration in fields 
such as food security, climate action, energy and biotechnology. It is also an asset in 
terms  of  tourism  based  on  an  exceptional  natural  and  cultural  environment.  Their 
locations  create  major  opportunities  for  development  of  space,  astrophysics  and 
satellite  activities  for  the  EU.  The  OR  host  a  unique  diversity  of  species  and 
ecosystems of crucial importance for biodiversity at a global scale. The OR, together 
with  the  overseas  countries  and  territories,  have  more  endemic  animal  and  plant 
species than continental Europe as a whole, including more than 20% of the world's 
coral reefs and lagoons. Their biodiversity offers potential in the areas of health, bio-
medicine and bio-pharmacy, cosmetics and many other sectors such as materials for 
eco-construction  and  wood.  The  conditions  exist  in  different  regions  to  develop 
renewable  sources  of  energy  from  bio-fuels  to  wind,  solar,  geothermal  or 
photovoltaic.  In  terms  of  human  capital,  the  OR  have  a  better  educated  and  skilled 
workforce,  public  services,  and  more  advanced  know-how  than  their  neighbours 
giving them the possibility to sell services and expertise in high added value sectors.  

The principles underpinning the proposed partnership for growth are to: 

- 

-  

-  

support  the  OR  in  exploiting  all  opportunities  for  smart,  sustainable  and 
inclusive growth based on their assets and endogenous potential; 
ensure  that  European  policy  frameworks  contribute  to  reducing  obstacles 
specific to the OR' full integration into the single market; and 
increase recognition of the OR as an asset to all, and of the need to take their 
specificities and constraints into account.  

Action  to  support  the  OR  requires  partnership  between  EU,  national  and  regional 
authorities.  Strong  commitment  to  action  is  required  at  all  these  levels.  The  OR 
themselves have a responsibility to seize the opportunities available to them.   

2. 

DEVELOPMENTS  IN  THE  EUROPEAN  STRATEGY  FOR  THE  OUTERMOST 
REGIONS 

Since  1999,  the  EU  has  formally  recognised  the  geographical  and  economic 
specificity  of  the  OR:  remoteness,  insularity,  small  size,  topography,  climate,  and 
economic  dependence  on  a  small  number  of  products,  which  severely  restrain 
development (Article 349 TFEU), and make it difficult for the OR to reap the benefits 
of the single market. 

5 

 
 
 
 
 
 
 
 
 
Since 2004, the Commission has set OR-related actions within a framework based on 
three  axes3:    improving  accessibility;  improving  competitiveness;  and  promoting 
regional  integration  in  neighbouring  regions.  Since  20084,  it  has  focused  on  making 
the most of the OR' unique assets.  

The  OR  themselves5,  supported  by  their  respective  Member  States6,  as  well  as  the 
Council  and  the  European  Parliament7  have  contributed  to  reflection  on  how  to 
improve  economic  performance.  In  2011  Pedro  Solbes  delivered  a  report  entitled 
"Europe's  Outermost  Regions  and  the  single  market:  the  EU's  influence  in  the 
world"8,  which  underlines  the  need  for  a  better  integration  of  the  OR  both  in  a 
deepened  and  consolidated  single  market  and  in  their  immediate  neighbourhood, 
building in particular on the external dimension of the single market. 

A  study  entitled  "Growth  Factors  in  the  OR"9  launched  by  the  Commission 
recognized  the  OR'  structural  constraints,  but  underlined  the  opportunities  for 
economic growth. The study also pointed to the differences among the OR and to the 
need  for  different  measures  adapted  to  address  the  particular  challenges  each  OR 
faces.  It  concluded  that  to  strengthen  traditional  sectors  like  agriculture,  greater 
product  differentiation  and  specialisation  is  essential.  Sustainable  tourism  has 
significant potential in most OR.   The study identified emerging sectors based on the 
OR'  assets  including    biodiversity  and  marine  ecosystems,  potential  for  producing 
renewable energy, advanced agro-environmental or climate research, astrophysics and 
aerospace science.  

Another  study  "Demographic  and  migration  trends  in  the  OR:  impact  on  economic, 
social  and  territorial  cohesion"10  also  stresses  the  ORs'  potential  but  points  to 
challenges in meeting educational, employment and environmental goals.      

The EU's renewed strategy for the OR should build on these elements.  

3  
4  

5  
6  

7  

8  

COM(2004) 343, 26.5.2004; COM(2004) 543, 6.8.2004  
Communication  from  the  Commission:  The  outermost  regions:  an  asset  for  Europe  (COM 
(2008) 642 final, 17.10.2008). 
Joint Memorandum, of the Outermost Regions: From now until 2020, 14th October 2009. 
Memorandum,  of  Spain,  France,  Portugal  and  the  Outermost  Regions:  A  renewed  vision  of 
the European Strategy for outermost regions, 7 May 2010. 

Report of the European Parliament on “The role of Cohesion Policy in the outermost regions 
of the European Union in the context of EU 2020", 18 April 2012 (rapporteur Nuno Teixeira) 
Commissioner Barnier asked former Minister of Agriculture and of Economy and Finance of 
Spain and former European Commissioner, Pedro Solbes Mira, to  undertake a study on the 
place of the OR within the single market 
http://ec.europa.eu/internal_market/outermost_regions/index_en.htm 

9         Carried out by Ismeri Europa, commissioned by the Commission in 2009, delivered in March 

10  

2011    
Carried out by the "Institut National d'Études Démographiques" (INED), commissioned by the 
Commission, and delivered in May 2012. 

6 

 
 
 
 
 
 
 
 
                                                 
 
3. 

AXES OF THE RENEWED EU STRATEGY 

While the existing framework for policy towards the OR remains valid, it needs to be 
updated  and  adapted  in  the  light  of  Europe  2020.  This  means  greater  emphasis  on 
creating jobs and growth, and a comprehensive approach to climate action. The axes 
are the following:   

I. 

II.  

III.  

Improving  accessibility  to  the  single  market.  Accessibility  means  transport, 
but also transfer of knowledge and the implementation, at reasonable cost, of 
new technologies for information and communication.  

Increasing  competitiveness through modernisation and diversification of OR 
economies,  investment  and  innovation  in  sectors  of  high  growth  potential 
and/or  of  high  added  value  (traditional  and  emerging  ones),  affordable  and 
sustainable energy supply as well as and support to development of the private 
sector  (mainly,  SMEs  and  micro  enterprises),  and  to  innovation  in  new 
products and services.  

Strengthening  regional  integration  within  the  ORs'  respective  geographic 
zones  to  expand  the  EU's  sphere  of  socio-economic  and  cultural  influence 
through the OR and to foster greater trade and sharing of knowledge. The OR 
are  outposts  of  the  EU  in  their  respective  regions,  and  the  EU  benefits  from 
their  close  relations  with  the  overseas  countries  and  territories11,  third 
countries  such  as  key  emerging  nations  (i.e.  Brazil  or  South  Africa), 
developing  countries  as  well  as  developed  countries  with  which  they  share 
historical and cultural links. 

IV.   Reinforcing the social dimension of the OR development, including through 
measures  for  employment  creation,  enhancing  skills  and  educational 
attainment,  reducing  early  school  leaving,  increasing  the  number  of  tertiary 
education  graduates,  fighting  poverty,  improving  access  to  healthcare  and 
improving social inclusion. 

V. 

Mainstreaming  climate  change  action  into  all  relevant  policies.  Appropriate 
action will be taken for adaptation and mitigation measures.  

The  proposals  for  the  future  in  the  next  section  each  have  a  positive  impact  on  the 
above axes. 

11  

Overseas countries and territories referred to in Articles 198 and 355(2) of the TFEU. Special 
attention  shall  be  given  to  the  future  Council  Decision  on  the  Association  of  the  Overseas 
Countries and Territories with the EU and in particular its provisions relating to the regional 
cooperation and integration of these territories. 

7 

 
 
 
 
 
 
 
 
 
 
 
                                                 
4. 

PROPOSALS FOR THE FUTURE 

The measures outlined in this communication need to be delivered in partnership. The 
Member  States  and  regional  authorities  concerned  should  maintain  strong 
commitment  to  maximising  the  potential  of  each  outermost  region  and  ensure  that 
national rules and practices are adapted where necessary to reflect the OR' needs. The 
OR themselves should continue to develop their capacity to participate in competitive 
tenders under EU programmes.     

In line with the Council conclusions of June 2010, the Commission will ensure that, 
where appropriate, the OR dimension is taken into account in impact assessments and 
other preparations for new policy initiatives. 

The Commission will reinforce the visibility of the OR in its communication policy, 
and will continue exchanges and temporary secondment of officials between the OR 
and the European institutions. 

4.1. 

 Internal dimension  

1) Cohesion policy  

Cohesion policy is the principal EU instrument to deliver Europe 2020, providing the 
greatest concentration of EU investment funds to create jobs and growth. In the OR, 
cohesion policy will support investments in smart, sustainable and inclusive growth. 
The emphasis will be on investment to permanently reduce disparities with the rest of 
the  EU.  The  thematic  concentration  of  funds  foreseen  in  the  proposed  reform  of 
cohesion  policy  will  help  in  particular  to  ensure  significant  funding  is  available  to 
support innovation in its widest sense; to promote modernisation  and  diversification 
of  the  economies;  to  address  key  human  capital  investment  needs;  to  strengthen  the 
SME  sector  to  create  and  maintain  jobs;  to  support  climate  change  adaptation  and 
mitigation and the development of sustainable energy supplies.  

The Commission proposes to continue to offer specific treatment for the OR to help 
them make the best use of the investment funds available. A co-financing rate of 85% 
is proposed regardless of the OR' GDP. A specific allocation is proposed to offset the 
additional costs of OR handicaps and to diversify and modernise their economies.  

The  Commission  will  assess  whether  each  OR's  individual  needs  and  assets  are 
appropriately  reflected  in  the  partnership  agreements  which  will  be  agreed  between 
the Commission and each Member State for the next financial period. 

Each  OR  will  be  required  to  analyse  its  potential  and  ensure  a  critical  mass  of  the 
ERDF  is  allocated  to  research  and  innovation,  to  promote  new  opportunities  for 
employment and enterprise inter alia to reduce the risk of brain drain, as well as  to 
energy  efficiency  and  to  renewable  energies.  Member  States  should  ensure  that  OR 
representatives are fully involved in the preparation and monitoring of the agreement.  

8 

 
 
 
 
 
 
 
 
 
 
 
To improve access to finance for micro to medium-sized enterprises, the OR will be 
encouraged  to  allocate  appropriate  funding  to  the  financial  instruments  under 
cohesion policy and to make use of the financial and non-financial products available 
under initiatives such as JEREMIE or JASMINE, to develop the potential of micro-
credit in their territories. 

The  Smart  Specialisation  Platform12  helps  Member  States  and  regions  prepare  their 
innovation strategies for cohesion policy funding. It offers the OR an opportunity to 
make the most of their unique assets in science and technology, contributing to, and 
benefiting  from,  new  opportunities  in  the  European  Research  Area  (ERA).  Such 
projects  and  innovation  strategies  should  fully  exploit  synergies  between  Horizon 
2020  and  the  new  cohesion  policy.  Projects  financed  through  research  framework 
programmes and cohesion policy funds can play a major role in attracting and training 
scientists  and  integrating  the  OR  fully  into  the  ERA,  including  important  spill-over 
effects in the local and regional economies. 

Under Commission proposals, the European Social Fund (ESF) will also continue to 
support the OR, which include regions with the highest levels of unemployment in the 
EU. Comprehensive investments are needed to foster market participation and labour 
mobility  (both  national  and  transnational),  and  boost  education,  skills  and  lifelong 
learning, in particular with a view to reducing early school-leaving and to increasing 
attainment  levels  in  tertiary  education.  The  ESF  will  also  help  the  OR  to  facilitate 
adaptation  of  workers  and  enterprises  to  change,  improve  productivity,  ensure  good 
integration  of  young  people  into  the  labour  market,  strengthen  social  inclusion  and 
enhance  institutional  capacity.  The  OR  should    take  advantage  of  the  proposed  EU 
Programme  for  Social  Change  and  Innovation,  including  PROGRESS,  EURES  and 
the European Progress Microfinance Facility.  

The  Commission  has  proposed  that  territorial  cooperation  financed  under  the 
ERDF13 involving the OR should be reinforced to improve competitiveness, trade and 
knowledge links with neighbours.  Under this proposal the OR should receive not less 
than 150% of the ERDF support they receive in the current period plus an additional 
allocation  of  EUR  50  million.  The  total  amount  that  may  be  allocated  to  OR 
operations outside the EU should increase from 10% to 30% facilitating projects with 
neighbouring countries and territories. The Commission underlines the opportunities 
offered by current arrangements for transnational co-operation, but would be open to 
facilitate  OR  cross  border  cooperation  on  maritime  borders  across  distances  greater 
than 150km. 

12  
13  

http://s3platform.jrc.ec.europa.eu/home  
COM(2011) 611 final, 6.10.2011 

9 

 
 
 
 
 
 
 
 
                                                 
2) Traditional sectors 

Growth Factors Study: 

"Production  and  employment  …  can  only  be  strengthened  through  product 
differentiation and specialisation"  

"Areas  of  specialisation  such  as  eco,  environmental,  social,  cultural  and  [wellness] 
tourism are still not fully exploited" 

Agriculture  and  rural  development.  The  POSEI  ("Programme  of  Options 
Specifically Relating to Remoteness and Insularity") agricultural support scheme is an 
instrument developed for the OR. With its two sections, specific supply arrangements 
and support  to  the  local agricultural production, the Member States have substantial 
flexibility to target expenditure, including for actions for diversification of production. 
The report on the impact of the POSEI reform of 2006 confirms the suitability of this 
scheme  to  the  needs  of  the  OR  and  that  the  allocated  resources  have  enabled  the 
objectives  of  the  programme  to  be  met.  The  Commission  proposes  to  maintain  the 
scheme with some adaptations, with the possibility of further review in 2013. In the 
context of such a possible review of the POSEI scheme, the significance of new areas 
of activity, such as timber production in French Guiana, will be analysed.  

Under  the  Commission's  proposals,  the  OR  will  also  continue  to  enjoy  specific 
treatment under the European Agricultural Fund for Rural Development (EAFRD)14to 
support  improvements  in  competitiveness,  diversification  of  activities  in  rural  areas,  
sustainable  management  of  natural  resources  and  a  balanced  territorial  development 
of rural areas.  

Fisheries.  The  Commission’s  proposals  for  reform  of  the  Common  Fisheries  Policy 
have  foreseen  that  fish  stock  management  and  decision  making  would  have  a  more 
regionalised character, addressing sea basins and taking account of the local stocks. In 
the framework of this regionalized approach, the Commission is discussing with the 
European Parliament and the Council how to ensure that stakeholders in the OR can 
become  an  effective  part  of  the  consultation  process  and  the  design  of  conservation 
measures,  including  by  creating  a  dedicated  Advisory  Council  for  the  OR  to  take 
better account of their specific context. 

Furthermore  the  local  fishing  industries  in  the  OR  should  receive  responsibility  to 
manage fisheries and work out a marketing plan to increase the value added of their 
products. The OR could take up a number of measures in the European Maritime and 
Fisheries  Fund  (EMFF)  proposals  which  are  of  particular  interest  to  them,  such  as 
actions  supporting  sustainable  local  development  of  fisheries  areas  or  support  for 
small scale coastal fleet, including business and marketing strategy advisory services 
or facility studies for innovative approaches. Support for aquaculture enterprises and 

14  

COM(2011) 627 final/2, 19.10.2011 

10 

 
 
 
 
 
 
 
 
                                                 
processing  enterprises  could  also  represent  an  important  source  of  funding  for 
potential beneficiaries in the OR and help create new job possibilities there in these 
businesses. 

On the funding side, the proposed EMFF takes into account the specificities of the OR 
by  offering  additional  financial  support  in  the  form  of  increased  aid  intensity  for 
EMFF investments in these regions. The proposed EMFF also foresees the integration 
of  the  compensation  mechanism,  the  so-called  "fisheries  POSEI",  so  that  the  OR 
would continue to receive support15.  

In addition, and following the existing model for the Azores, Madeira and the Canary 
Islands, the Commission is discussing with the European Parliament and the Council 
the  establishment  of  an  exclusive  access  zone  which  could  be  envisaged  for  the 
French OR. 

Tourism  is  an  established  area  of  activity  in  some  OR,  but  there  is  still  significant 
potential  for  further  growth  according  to  the  Growth  Factors  study.  The  OR  are 
invited to redouble efforts to implement the actions described in the Communication 
"Europe, the world's N°1 tourist destination" (June 2010) to make tourism sustainable 
and  allow  growth,  through  specialisation.  Efficiency  should  be  raised  through 
increased use of ICT and enhancing quality, skills and competence. The new cohesion 
policy programmes will be a source of finance for investment in tourism.  

Cultural  and  natural  heritage  are  an  important  resource  for  tourism-oriented 
development  in  OR.  The  EU  will  promote  measures  contributing  to  protection, 
sustainable  use  and  added  value  of  cultural  and  natural  heritage,  including 
biodiversity, and access to it for tourism purposes in the OR. 

The Commission will seek to ensure access of the OR to the Union's future cultural 
policy programmes and initiatives in order to develop cultural and creative industries.   

15  

COM(2011) 804 final, 2.12.2011. 

11 

 
 
 
 
 
 
 
 
 
 
                                                 
3) Emerging sectors 

Growth Factors Study: 

"[Need to strike the right] balance between a radical improvement of the traditional 
sectors  and  the  creation  of  a  sufficient  space  of  growth  for  the  new  products  and 
sectors" 

"The  mix  of  endogenous  resources,  new  technologies  and  the  way  that  factors  are 
organised may give rise to a competitive advantage"  

"Policies  need  to  focus  and  concentrate  human  and  material  resources,  make  them 
more market oriented, rather than disperse them in too many potential fields"  

Research and innovation. The participation of the OR in RTD networks will be key 
to  delivering  "smart"  growth  in  the  OR.  There  are  already  many  examples  of  good 
practice, although a lack of research critical mass remains a challenge. The proposed 
"Horizon 2020" will nurture scientific excellence in the OR, support technological as 
well  as  practice-based  innovation  and  stimulate  private  sector  investment  in 
experimentation, including in agriculture and endemic biodiversity. The aim will be to 
get  stakeholders  from  a  wide  diversity  of  fields  involved  in  encouraging  innovation 
that may lead to new products or applications in traditional sectors, or open up new 
areas of economic activity, creating employment.     

Sustainable Energy. The EU will support current and new actions designed to reduce 
dependence on energy imports and on fossil fuels in the OR and to develop renewable 
energy  sources  through  the  structural  funds  and  initiatives  such  as  the  "Pact  of 
Islands". The objective will be to enhance self-sufficiency in energy, and support the 
creation of centres of excellence which would contribute to achieving a reduction in 
CO2 emissions of at least 20 % by 2020.  

Following  suggestions made by the European Parliament in the field of energy, the 
Commission  will  examine  with  the  OR  and  their  Member  States  how  funding  for 
renewable energy and energy efficiency under the cohesion policy funds can best be 
deployed to meet the specific needs and capacities of the OR.  

Maritime opportunities. In view of developments in the Integrated Maritime Policy 
of  the  European  Union16,  EU  funds  in  the  2014-2020  period  under  the  common 
strategic  framework  or  other  relevant  horizontal  programmes  can  be  devoted  to 
investments  in  the  maritime  and  marine  economy  in  the  OR.  In  this  respect,  the 
Macaronesian and Caribbean OR should seize the opportunities offered under the EU 
Atlantic Strategy17.   

16  
17  

COM(2007) 575 final, 10.10.2007 
COM(2011) 782 final, 21.11.2011. 

12 

 
 
 
 
 
 
 
 
 
                                                 
In the field of knowledge networks, the Commission intends to roll-out the European 
Marine Observation and Data Network (EMODNet) programme after 2012 to the OR. 
The  Commission  will  continue  to  take  account  of  the  OR  dimension  in  the 
implementation of the Union's integrated maritime policy, including the Blue Growth 
initiative18.  

4) Developing entrepreneurship  

Small  and  Medium-sized  Enterprises  are  important  for  the  relatively  small-scale 
economies of the OR. A key problem is accessing finance for business development. 
The  Commission  will  take  account  of  the  particular  situation  of  the  OR  when 
implementing  the  Action  Plan  to  improve  access  to  finance  for  SMEs19  and  the 
Microfinance and Social Entrepreneurship support axis20of the Programme for social 
change and innovation.  In addition to what may be done with ERDF initiatives such 
as  JEREMIE,  the  Commission,  together  with  the  EIB  group,  will  work  with  the 
Member States and the OR  to support the creation of local investment funds in each 
OR and the development of regional capital/investments markets. 

Social entrepreneurship. Social enterprises are important drivers of inclusive growth 
and  development.  The  OR  should  examine  their  options  under  the  new  Social 
Business Initiative (SBI), adopted in October 2011, which aims to create a favourable 
environment for companies whose first ambition is to tackle social needs, setting out a 
comprehensive  action  plan  to  enhance  the  visibility  of  social  businesses  and  their 
access  to  financing.  Dedicated  investment  priorities  have  been  proposed  in  this 
context under the ERDF and ESF regulations for 2014-20. 

5) Integration in the single market    
The  Single  Market  Act21  has  underlined  the  importance  of  the  single  market  as  a 
competitiveness platform for the OR. A second chapter of the Single Market Act is to 
be adopted in autumn 2012. Wherever it is relevant, the specific situation of the OR 
will be taken into account to enable their full integration in the single market. 

The  first  obstacle  to  such  integration  is  the  OR'  remoteness.  The  EU  will  take  into 
account  the  OR  dimension  in  the  implementation  and  development  of  the  trans-
European  networks  in  the  fields  of  transport22,  telecommunications  and  energy.  In 
these  three  fields,  the  OR  will  be  included  in  projects  of  common  interest23  where 

18  
19  
20  

21  

22  
23  

Council Conclusions  19.12..2011, point 12. 
COM(2011) 870 final, 7.12.2011; and SEC (2011) 1527 final.  
COM(2011)  609  final,  6.10.2011.  The  implementation  of  these  measures  may  be  done 
through financial instruments, with take-up of funding depending, inter alia, on the conditions 
of, and awareness about the instruments, as well as demand from the micro credit providers.  
COM(2011) 206 final, 13.4.2011: "[We need a] better integrated market which fully plays its role as 
a platform on which to build European competitiveness for its peoples, businesses and regions, including 
the remotest and least developed". 
COM(2011) 650 final/3, 6.02.2012, Art. 4(2)(j) 
See below the External Dimension 

13 

 
 
 
 
 
 
   
 
                                                 
appropriate and in line with the policy objectives and criteria, as set out in the sectoral 
Guidelines  once  adopted.  The  proposed  Connecting  Europe  Facility  (CEF)  will  also 
follow this approach when identifying those projects of common interest eligible for 
funding.  More  specifically,  in  the  field  of  transport,  projects  of  common  interest 
involving  OR  and  focused  on  Motorways  of  the  Sea  would  be  eligible  for  financial 
support from the proposed CEF.  

Following suggestions made by the European Parliament in the field of transport, the 
Commission  will  examine  with  the  OR  and  their  Member  States  how  the 
opportunities under the cohesion policy funds can best be used in each case. 

Eliminating  the  digital  divide  and  increasing  OR  access  to  the  digital  single  market 
will  be  important.  In  order  to  create  a  well-functioning  and  effective  digital  single 
market,  the  OR  dimension  will  be  taken  into  account  explicitly  in  all  forthcoming 
regulatory proposals on the European digital single market. 

State  aid  rules  are  key  to  avoiding  distortions  of  competition  in  the  single  market. 
Article 107(3)(a) of the TFEU explicitly recognises the OR as regions where aid can 
be  granted  to  promote  economic  development  in  view  of  their  structural,  economic 
and  social  situation.  In  this  context,  the  regional  aid  guidelines  will  maintain 
preferential  treatment  for  the  OR.  In  addition,  special  rules  for  the  OR  in  the 
agricultural, fisheries and the aquaculture sectors will be maintained.  

Public procurement rules based on fair and open calls for tender are a pillar of the 
single  market.  The  Commission  will  explore  the  possibility  of  reflecting  the  OR 
dimension  in  the  implementation  phase  of  its  proposals  for  the  reform  of  EU 
procurement rules once they are adopted. To determine whether public contracts not 
or  not  fully  subject  to  EU  procurement  rules  are  subject  to  EU  Treaty  rules  and 
principles,  an  OR  dimension  has  already  some  relevance24.  The  current  situation 
however should be further clarified. Contracting authorities in the OR may require the 
hiring of local labour by the enterprises to which a public contract has been awarded, 
as  long  as  there  is  no  direct  or  indirect  discrimination  regarding  the  freedom  of 
establishment  and  freedom  to  provide  services25  and  conflicts  of  interests  are 
prevented and avoided.  

Taxation  and  Customs.  Specific  regimes  have  contributed  to  increasing  the 
competitiveness of the OR. The Commission will examine requests and justifications 
from the Member States concerned for prolongation or modifications of these regimes 

24  

Given  that  geographic  location  and  the  size  and  structure  of  the  market  are  criteria 
determining whether a contract award is of interest to operators from other Member States - 
see C179, 01.08.2006: Point 1.3 in Commission interpretative Communication on the EU law 
applicable to contract award not or not fully subject to the provision of the Public Procurement 
Directives.  

25        Judgement of the Court in Case 31/87 Beentjes [1988] ECR 4635.  

14 

 
 
 
 
 
 
 
 
 
                                                 
 
 
and will bring forward proposals accordingly, taking into account the effects of these 
regimes  on  the  local  economy  and  on  the  internal  market.  Principles  of  good 
governance  in  the  tax  area  (transparency,  exchange  of  information  and  fair  tax 
competition) should prevail as in any other parts of the Union. 

Better information. ‘Single Market’ contact points will be set up in each OR, with 
specific  training  measures  for  enterprises  and  public  officials  in  the  OR  providing 
more information about the possibilities on offer. More use will also be made of the 
IMI and SOLVIT platforms. 

Education  and  skills.    The  proposed  programme  "Erasmus  for  All"26  will  provide 
opportunities  to  support  partnerships  between  business  and  education  and  training 
institutions (i.e. universities, vocational training institutions) of the OR and facilitate 
and promote the mobility of student and teachers to and from the OR. Modernisation 
of education and training systems as well as measures for improving the accessibility 
of good-quality education can be financed from the ESF. 

On  consumer  policy,  the  Commission  will  take  into  account  when  appropriate  the 
OR  dimension  in  implementation  of  its  new  European  Consumer  Agenda.  Issues  of 
interest  for  OR  consumers  relate 
travel, 
telecommunications and energy.  

to  sectors  such  as 

in  particular 

Health is important given the inequalities in life expectancy and health status between 
OR  and  the  continent.  Cohesion  policy  offers  opportunities  to  invest  in  health 
infrastructure  –  including  telemedicine  and  in  the  training  of  health  professionals  in 
their OR. 

6) Protecting the outermost regions' environment 

EU  civil  protection  policy  supports  measures  to  minimise  the  ORs'  particular 
vulnerability to natural disasters helping to create the conditions for more sustainable 
growth.  The  geography  and  the  difficult  topography  of  the  OR  hamper  the 
deployment of intervention resources and create particular needs for assistance in the 
event  of  a  major  emergency.  The  Community  Civil  Protection  Mechanism  Decision 
and the Civil Protection Financial Instrument Decision27 make reference to the special 
needs  of  the  OR  and  take  them  into  account  in  the  implementation  of  EU  CP 
Mechanism-related  actions.  The  Proposal  on  a  Union  Civil  Protection  Mechanism28 
reiterates this support. 

26  
27  

28  

COM(2011) 788 final,  23.11.2011. 
Council  Decision  2007/162/EC  of  5  March  2007;  Council  Decision  2007/779/EC  of  8 
November 2007. 
COM(2011) 934 final, 20.12.2011 

15 

 
 
 
 
 
 
 
 
 
 
                                                 
Climate  action.  The  EU  will  take  action  both  in  the  fields  of  climate  change 
mitigation  and  adaptation29.  ORs'  resilience  to  climate  change  impacts  has  to  be 
increased  by  supporting  climate  change  adaptation  in  all  relevant  sectors,  and 
promoting a greener, low-carbon economy, the improvement of energy and resource 
efficiency as well as sustainability of transport and agriculture. Coastal protection is a 
particular concern for the OR.  The results of a study ordered by the Commission on 
the impact of climate change in the OR will be published in 2013.  

Biodiversity  and  ecosystem  services.  Efforts  will  be  strengthened  to  support 
biodiversity  and  ecosystem  services  in  the  OR,  building  upon  initiatives  such  as 
BEST  (voluntary  scheme  for  Biodiversity  and  Ecosystem  Services  in  Territories  of 
the OR and OCTs), which helps to deliver on all relevant targets and actions of the 
EU  Biodiversity  Strategy.  Activities  in  this  area  can  be  financed  by  the  structural 
funds. 

4.2.  

External dimension   

Given the OR' geographical position, EU policies with an external dimension are key 
to this strategy. To develop their own potential, and bring their full added value to the 
EU, the OR need to better integrate not only within the single market, but within their 
own  regional  neighbourhoods.  Regional  neighbourhood  plans  should  be  established, 
consistent  with  EU external  policy  objectives. Coordination and complementarity of 
actions by EU authorities will be improved, particularly more will be done to improve 
co-ordination  and  synergy  between  the  cooperation  programmes  supported  by  the 
ERDF  and  other  instruments,  chiefly  the  European  Development  Fund,  but  also  the 
Development  Cooperation  Instrument  (DCI)  and  Partnership  Instrument  (PI).  The 
external  dimension  of  the  single  market  for  OR  will  need  to  be  strengthened  too, 
building on the work done in the context of the Single Market Act.  

Cooperation between the OR and their neighbours will be pursued in the interests 
of  all  sides,  and  with  a  particular  focus  on  boosting  economic  opportunities.  
Cooperation  can  be  encouraged  through  better  exploitation  of  ad  hoc  provisions 
contained  in  EU  agreements  with  third  countries30,  or  by  making  better  use  of 
programmes  such  as  Erasmus  Mundus  in  education,  where  OR  universities  are 
potential leaders in training activities. The OR have the potential to become business 
and cooperation platforms and logistical hubs. 

Trade  and  fisheries  agreements.  EU  agreements  will  take  due  account  of  the  OR, 
for example, where agreements cover products produced in the OR. This can help OR 
producers compete not only in the EU, but also in third country markets. The practice 
of  accompanying  proposals  for  trade  agreements,  such  as  the  Economic  Partnership 
Agreements, with impact analyses, is now well-established and should where relevant 
address the OR dimension. The inclusion of specific safeguard clauses for the OR are 

29  

30  

White  Paper  "Adapting  to  climate  change:  towards  a  European  framework  for  action", 
COM(2009) 147 final, 1.4.2009 
For example, Art. 132(h) and Art 239 of the EPA EU/CARIFORUM.  

16 

 
 
 
 
 
 
 
 
                                                 
important,  but  information  should  be  improved  to  ensure  that  such  clauses  are  fully 
used if need be.   

New  or  more  efficient  air  and  maritime  routes  between  the  OR  and  their 
neighbours. The Commission will reflect on how the specificities of the OR might be 
taken  into  account  as  it  prepares  for  the  revision  of  the  1994  and  2005  Aviation 
Guidelines31 and the review of the 2004 Maritime Guidelines32. The Commission will 
assess  requests  from  Member  States  to  conclude  bilateral  agreements  with  third 
countries neighbouring OR, establishing service requirements on passenger transport 
similar  to  public  service  obligations  contracts  under  EU  law.  This  could  only  be 
envisaged when market conditions alone are not enough to attract economic operators, 
without any discrimination among the latter and in respect of the existing bilateral and 
multilateral  agreements  and  relevant  state  aid  rules.  The  EU  will  also  consider  the 
conclusion of agreements  with  countries neighbouring the OR to liberalise transport 
and increase connections. 

Energy.  The  EU  will  support  projects  to  create  more  effective  energy  markets 
encompassing the OR and neighbouring countries and territories. 

Electronic  communications  networks.  Improving  the  reliability  of  network 
infrastructure will be a top priority. Current digital networks that rely on a single low-
capacity  undersea  cable  connection  do  not  guarantee  service  continuity,  and  are 
unable  to  deliver  constantly  increasing  speeds.  Issues  concerning  access,  tariffs, 
quality and security of ICT services need to be addressed more resolutely, particularly 
to create the conditions for ‘high-speed’ internet. The national competition authorities 
have a key role to play in determining the conditions for acquiring capacity through 
undersea cables and the conditions for access to the terrestrial parts of these cables.  

SMEs operating internationally. The Commission will take particular account of the 
OR when carrying out the actions referred to in its communication ‘Small Business, 
Big World"33.   

Business-to-business alternative dispute instruments. Confidence building between 
businesses  located  in  OR's  and  in  their  third  country  neighbours  is  one  of  the  first 
concrete steps needed to unlock trading flows within regional ensembles. To achieve 
this, the establishment of business-to-business alternative dispute settlement systems 
between  the  OR,  the  OCTs  and  neighbouring  third  countries  should  be  encouraged 
through the approximation of the legal systems involved. 

Mobility. The Member States should step up efforts to facilitate the mobility of key 
groups  of  third  country  nationals  such  as  students,  researchers  and  the  business 

31  

32  
33  

Community  guidelines  on  financing  of  airports  and  start-up  aid  to  airlines  departing  from 
regional airports, OJ C 312, 9.12.2005, p. 1. 
Community guidelines on State aid to maritime transport, OJ C 013, 17.01.2004, p.3 
COM (2011) 702, 9.11.2011. 

17 

 
 
 
 
 
  
 
 
 
 
                                                 
community,  while  continuing  efforts  to  reduce  irregular  immigration  and  address 
trafficking in human beings.  

5. 

CONCLUSION 

Much  has  been  achieved  in  the  OR  but  their  economies  remain  relatively  fragile. 
Efforts to mitigate their permanent constraints and to ensure their full integration into 
the single market and into their respective neighbourhood need to be maintained and 
consolidated by actors at all levels. Their specificities should be taken into account in 
the  new  generation  of  policies  implementing  Europe  2020,  and  they  and  their 
respective Member States should do all they can to ensure they seize the opportunities 
that  exist.  Potential  growth  in  the  OR  can  come  from  restructuring  the  traditional 
sectors of tourism, agriculture and fishery, and new specializations which stem from 
the application of RTDI to old and new sectors.  

Modernising  traditional  sectors  and  diversifying  into  well-chosen  new  areas  of 
activity will be key to the future prosperity of the OR.  The Commission will support 
each OR in tracing its own individual path to diversification and modernisation of its 
economy,  with  a  view  to  creating  more  robust  economic  conditions  and  reducing 
disparities  with  other  EU  regions.  Each  OR  together  with  their  respective  Member 
State  is  invited  to  draw  up  an  Action  Plan  setting  out,  with  targets  and  milestones, 
how  they  intend  to  implement  the  Europe  2020  agenda  taking  account  of  their 
individual  situations,  and  the  different  instruments  available  set  out  in  this 
communication.  

The  Commission  will  pursue  efforts  to  strengthen  the  integration  of  the  OR  in  the 
single  market  and  in  their  geographical  environment  at  regular  meetings  of  a 
dedicated  interservice  group.  By  the  end  of  2017  at  the  latest,  the  Commission  will 
review implementation of each of the measures proposed in this communication.       

18