EU cohesion policy: building an investment policy for a more cohesive Europe

EU cohesion policy supports hundreds of thousands of projects in all European regions, it is the EU’s largest source of investment, encouraging important real economy projects and contributing to structural change in EU member states.

EU cohesion policy is part of the Treaties and a reflection of the EU’s solidarity. But more than that, cohesion policy is very important to support a more cohesive Europe in all its forms: economic, social and territorial.

It is however time to move past a mindset of redistribution and fast spending to a rationale of investment, competitiveness and structural improvement. This will be necessary to boost the success cases of this policy while at the same time achieve greater convergence between member states, a necessary condition for a proper functioning of the EU.

EU cohesion policy must be an integral part of a European investment strategy, with a strong territorial approach, aiming at empowering each region with the necessary tools to build up their competitiveness. It must lead to economic and structural transformation, securing a resilient base in each region, based on their own strengths.

It is important to acknowledge that the achievements of EU cohesion policy go well beyond the financial envelope made available through the European Structural and Investment Funds, and are strongly anchored to the positive side effects it instigates. These are visible in terms of capacity building, the definition of long-term priorities, regional specialisation strategies, partnership, and others.

But these benefits must be magnified. This is particularly important in view of the exit of the UK from the EU and expected EU budget reductions. The EU cohesion policy must therefore modernise and simplify the way it operates, setting a medium to long-term framework but with enough flexibility to readapt to new events, supporting projects with clear EU added value, and providing the right incentives for performance.

In this position paper, BusinessEurope outlines a number of ideas on how to improve and strengthen the EU cohesion policy, making it fit to address today’s challenges and to prove a real enabler for European regions to compete by scaling up and exploring their capabilities.