Recovery and reform in the EU’s most vulnerable regions. EPC Policy Paper June 2021.

Hunter, Alison and Pilati, Marta (2021) Recovery and reform in the EU’s most vulnerable regions. EPC Policy Paper June 2021. [Policy Paper]

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Abstract

Europe’s most vulnerable regions, characterised by persistent low growth and poverty, face a systemic lack of specific EU support. These regions display particularly high levels of vulnerability to the social, economic and territorial impacts of COVID-19, which will affect their recovery trajectories. They risk being left further behind in the EU’s complex pathway towards ‘a green and digital recovery’. The Union’s lack of focus and action for investing in these most vulnerable regions must be addressed. First and foremost, EU institutions and member states should recognise that some territories will struggle much more than others in their recovery trajectories. Ignoring their plight would have potentially far-reaching consequences. The EU’s ‘convergence machine’ could be damaged irreparably, with long-term – and potentially political – consequences. Alison Hunter and Marta Pilati continue their extensive research on the Union’s low-growth, poor regions, calling for the founding of a specific EU initiative to support them as well as further targeting by the existing policy architecture. In particular, they recommend: creating an EU policy space for regions experiencing long-term low growth and poverty, to promote the value and visibility of place-based support; aligning Cohesion Policy and the Recovery and Resilience Facility for improved policy coherence and greater investment impact; and tailoring support for growth-enhancing reforms in the EU’s most vulnerable regions. The EU’s green and digital recovery strategy fails to account for the specific needs of its poor and low-growth regions. Existing disparities and fragmentation challenges across the Union could widen or even become entrenched, casting new doubts on the EU’s ability and commitment to strengthen its convergence agenda and execute a just transition. The fallout could lead to a rise in territorial and political tensions while leaving many vulnerable places behind. Hunter and Pilati outline an agenda for a new EU initiative that champions reform support for these vulnerable territories and improves their prospects for a digital and green recovery.

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