CER study: “Enlargement could put pressure on cohesion funding.” M5S: “Caution needed”

Brussels – EU enlargement: the timing seems right, but the approach to achieving it may be less so. Russia’s war in Ukraine has reignited the need for the European Union to expand even further eastwards, driven by a geopolitical imperative which, while seemingly beyond dispute, nevertheless presents challenges for which there is as yet no clear answer. The Left Group in the European Parliament, on the initiative of MEP Danilo Della Valle (M5S), has asked the Centro Europa Ricerche (CER) to carry out a study on the impact of the accession of ten countries (Albania, Bosnia and Herzegovina, Georgia, Kosovo, North Macedonia, Moldova, Montenegro, Serbia, Turkey, Ukraine) to the EU, and the study’s findings are characterised by caution. 

The 64-page document, in a nutshell, warns of the risk of reduced structural funding for European regions, particularly those in Southern Italy. This possibility arises because the accession of states with a gross domestic product below the EU average would trigger an automatic recalculation of all parameters. “The proposed accession of other Member States with a per capita GDP of between 30 and 50 per cent of the EU average further lowers the eligibility threshold for EU cohesion programmes,” notes the CER. This means that those currently classified as “less developed” would automatically be moved to a more developed category and would therefore no longer be eligible for additional funding. 

“With specific reference to Italy, under the current framework (MFF 2021–2027), there are seven “less developed” regions with a per capita GDP of less than 75 per cent of the European average (Molise, Campania, Puglia, Basilicata, Calabria, Sicily, Sardinia) and three “transition” regions, with a per capita GDP of between 75 per cent and 100 per cent of the European average (Abruzzo, Umbria, Marche). With the accession of Eastern European and Western Balkan countries, the Marche would therefore move into the category of “more developed” regions, while Basilicata, Molise, and Sardinia would move up to the group of “transition” regions. “This would result in a significant loss of resources compared with the current situation.” 

EU wants enlargement – its citizens, less so

Estimates suggest that 10 Italian regions are set to face cuts to EU funding, with losses exceeding 58 per cent of current allocations in Molise, Basilicata, and Sardinia, around 48 per cent in Umbria and the Marche, and between 29 and 32 per cent in Sicily, Calabria, Puglia, and Campania.

The budget issue and the limitations of the comparison

However, the CER study does contain points worth considering. To begin with, it is based on projections using out-of-date figures for overall cohesion policy resources: the proposal for the next multi-annual budget (MFF 2028–2034) is still to be negotiated, and the proposed figures remain indicative; however, regarding cohesion, both the Parliament and some Member States in the Council are calling for more resources. Therefore, the discussion of the figures appears to be indicative, and risks being misleading. This is also because, while the accession process appears to be at an advanced stage for Albania and Montenegro, and has been accelerated for the other candidates, it seems difficult to envisage simultaneous accession. In any case, should this occur during the current multiannual budget period, budgetary adjustments will be necessary, with the appropriate corrections.

A call for caution and countermeasures

“We are not prejudicially opposed to enlargement, but we call for caution,” clarify the MEPs from the Five Star Movement Danilo Della Valle and Valentina Palmisano. The point of the study lies here, in the call to thoroughly assess the procedures for the accession of candidate countries. This call is, moreover, in line with the recommendations of the High-Level Group on Cohesion: the experts advising the European Commission have made it clear that for enlargement to be done properly, more money is needed to ensure that EU funding for the most disadvantaged regions does not disappear. The Bruegel think-tank, in an impact assessment regarding Ukraine’s accession alone, has warned that the current 27 Member States could receive €24 billion less in cohesion funding compared with the current situation. 

“The Cohesion Fund and CAP funds are the driving force behind the EU, and this driving force risks grinding to a halt without adequate compensatory measures,” continue the two Five Star Movement MEPs, calling for the necessary steps to be taken. In the view of Della Valle and Palmisano, the message emerging from the CER report is that “the four accession conferences for Ukraine, Moldova, Montenegro, and Albania are opening today without adequate consideration of the consequences that this process will have on Southern Europe.”