Welcome to the Committee of the Regions

1
Gerhard Stahl Secretary General of the Committee
of the Regions The answer of Europes regional
and local authoritiesConference co-organised by
the Wales Governance Centre at Cardiff University
and the Welsh Assembly Government Small
countries and the global crisis challenges and
opportunities? Cardiff, 1st July 2009
European Union
Welcome to the Committee of the Regions
2
Contents

• The scenario globalisation, EU, citizens and the
  crisis
• Regions, local authorities drivers for
  innovationand sustainable recovery
• The scale territorial cooperation, Europe and
  the world
• The engagement of the CoR
• EU decision-shaping
• Multilevel Governance
• Territorial cooperation
• The CoR and the Academia

3
The scenarioGlobalisation, EU, citizens and the
crisis
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Globalisation, European integration, localisation.

• Global challenges economic globalisation,
  demographic change, migration flows, climate
  change, energy
• European integration EU enlargement, widening of
  the EURO area, enlargement of the Schengen area,
  Lisbon Treaty
• Localisation single territories are directly
  faced with challenges and have access to
  opportunities of a larger magnitude and which
  requires pooling of resources

5
EU Single Market the largest in the world. An
asset to preserve. The most advanced model of
governed globalisation.
Source WTO, International Trade Statistics, 2007
6
Imbalances of the World Economy
Source IMF (Oct 2008), Global Financial
Stability Report
7
Chronology of the banking crisis in 2008

• 17/02/08 Northern Rock nationalised
• 17/03/08 Bear Stearns acquired by JP Morgan Chase
• 01/04/08 Sachsen LB acquired by LBBW
• 11/07/08 Indy Mac nationalised (FDIC)
• 21/08/08 IKB acquired by Lone Star
• 08/09/08 Fannie Mae, Freddie Mac nationalised
• 15/09/08 Lehman Brothers insolvent
• 15/09/08 Marrill Lynch acquired by Bank of
  America
• 17/09/08 AIG nationalised
• 17/09/08 HBOS acquired by Lloyds
• 22/09/08 Goldman Sachs and Morgan Stanley become
  regular commercial banks
• 26/09/08 Washington Mutual acquired by JP Morgan
  Chase
• 29/09/08 Fortis rescued by the State
• 29/09/08 Bradford Bingley nationalised
• 29/09/08 Hypo Real Estate rescued by the State
• 29/09/08 Wachovia acquired by Citigroup
• 30/09/08 Dexia rescued by the State
• 09/10/08 The State of Iceland is insolvent
• 10/10/08 Yamato Seimei Hoken (Japan) insolvent

8
Reasons for the financial crisis

• Limited liability, economic growth and casino
  capitalism
• Under-capitalisation
• Excessive risk-taking (mortgage backed
  securities, asset backed securities,
  collateralized debt obligations, rating agencies)

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Annus horribilis

• Unprecedented financial, economic and social
  crisishow to avoid the worst?how to regain
  economic tonicity?how to preserve social
  cohesion?how to re-invent our future?
• Energy / climate crisisgeopolitics impact in a
  new multipolar world under shape
• Institutional crisis
• treaty stuck

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10
The crisis gloomy expectations
Source The Euro Growth Indicator is calculated
by the Observatoire Francais des Conjonctures
Economiques (OFCE, Paris) in cooperation with the
EUROFRAME and published by the Financial Times
Deutschland. The purpose of this leading
indicator is to anticipate the development of the
GDP in the euro area two quarters ahead of
official statistics.
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The crisis keep the reins and prepare a new
sustainable future

• Coordinate recovery measuresAvoid protectionism
  andbeg thy neighbour policies
• Supervise and regulate financial markets
  International and EU supervisory framework,
  reconsider accounting practices, regulate credit
  rating agencies
• Balance short-term stabilising measureswith
  long-term structural reforms
• Temporary, targeted, timed action.Regain
  contact with the field. Envisage EXIT
  strategies
• Develop the new paradigm for sustainable economic
  growth Prepare a revised Lisbon Strategy
• Invest in new economic driverse.g. renewable
  energies, services to people
• Protect and reform social cohesione.g. invest in
  re-qualification of people

Return to basics take careof peopleand nature?
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Quantity of (deficit) public spending is raising
Projected budgetary deficits for euro-area
countries, 2007-2010
Source European Commission Economic Forecast
Spring 2009
13
QUALITY of (deficit) public spending will be
essential

• Incentives must be selective? leading to
  change industries and orientate consumes
• Innovation need to be built-in in new fixed
  capital expenditure? massive investment plans
  (infrastructures, buildings, ICT networks) may
  help in this phase to enlarge the scope and
  scaleof application of existing advanced
  technologies.
• Public expenditure needs private engagement ?
  e.g. EIB loan based instruments

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Regions and local authoritiesdrivers for
innovation and recovery
14
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The European citizen

• Special Report 307
• The role and impact of local and regional
  authorities in Europe
• February 2009
• Field Oct-Nov 08

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Across the Atlantic

• 17 Feb American Recoveryand Reinvestment Act
• 20 Feb Obama and Biden convene85 mayors at the
  White House
• Too often in the past, America's cities have
  been neglected, and our mayors haven't had --
  haven't been able to be heard on the questions of
  national policyYou are -- you're the ones who
  know the areas that give us the greatest return
  on our investment -- you know it better than we
  do.
• Now, rebuilding our economies and renewing our
  cities is going to require a true partnership
  between mayors and the White House, and that
  partnership has to begin right nowInstead of
  waiting for Washington, many of you have already
  made our cities laboratories of change, coming up
  with innovative new ways to solve the problems of
  our timewhat I will need from all of you, is
  unprecedented responsibility and accountability

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Sub-national public sector across Europe, key
figures

• 92 500 local and regional authorities
• 18 million people employed(56 of total public
  employment)
• 16 of total EU GDP
• 1/3 of total public expenditure
• 2/3 of total public capital expenditure
• comparison European Economic Recovery
  Plan1,5 of EU GDP 0,3 (EU) 1,2(MS)3,3
  if automatic stabilisers are counted

Huge potentialfor innovation
17
Source Dexia (December 2008), Sub-national
governments in the EU.
18
Sub-national public expenditure, key investment
driver
On average2/3 of totalpubliccapital expenditure
Source Eurostat, EC(2007), Fourth Cohesion Report
19
Level of public expenditure, decentralisation and
Innovation ranking
Innovation Scoreboard ranking Innovation
leaders Innovation followers Moderate
innovators Catching-up countries
Source our elaboration from Dexia(2008),
Sub-national governments in the EU.and from
EC(2008), European Innovation Scoreboard
19
20
Many channels to inject innovation in
local/regional expenditure
Source Dexia(2008), Sub-national governments in
the EU.Organisation, responsibilities and finance
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Innovation drivers regions and local authorities
act as
Facilitators e.g. better regulation,
e-infrastructure, e-services, Innovators e.g.
re-engineering of public services (Web
2.0) Promoters e.g. incentivating new energy
efficiency applications Coordinators e.g.
fostering sector based public-private
partnerships Networkers e.g. by creating
European innovation networks Forerunners e.g.
by developing pilot projects which deliver
quicker and more ambitiously than targets set at
national / EU level(e.g. fight to climate change
Covenant of Mayors)
22
Navarra, an example of green innovation

• Navarras development of Renewable Energy Sources
  (RES)
• Around 100 companies working in this sector (GDP
  5)
• 5000 jobs generated
• Technology, know-how development and
  internationalisation
• Companies of Navarra have registered 43 patents
  on RES issues
• Environment improvement - every year circa
  5.000 CO2 tons have not been emitted -
  non-fossil fuels account for 61 of electricity
  consumed in Navarra, against Spanish average 10.
• Governamnet of Navarras support- more than 400
  MEUR invested on RES systems
• - substantial investment through EU cohesion
  policy

23
Ruhr2010

• Ruhr Region is diversifying its production and
  employment base
• In North-Rhine Westphalia,creative industry
  (media, arts, culture, etc.)accounts nowadays
  for
• 32.1 billions EUR turnover
• 156.000 people employed
• 46.300 enterprises

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The leverage effect of EU Cohesion Policy

• The EU regional policy
• based on solidarity
• activated in all EU regions
• is an effective lever for regional and local
  innovation
• Leverage effects
• Financial leverage? national and regional
  co-financing, PPPs, financial engineering
• Strategic policy orientation? mainstreaming of
  EU policies in local context, adaptation
• Institutional capacity building? innovation of
  administrations, reinforcement of management
• Cohesive building of Europe? local partnership,
  citizens involvement, territorial cooperation

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The scale territorial cooperation,Europe and
the world
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Meta-regions, e.g. strategy for Baltic Sea Region
(and others?)

• More strategic and flexible territorial
  cooperation
• Macro-region level allows to address challenges
  which go beyond traditional regional or national
  boundaries (e.g. Strategy for Baltic Sea Region,
  Strategy for Danube Basin)
• Attempt to better coordinate legislation,
  planning, funding across EU, national, regional
  and local policy-making
• Sometimes, internal territorial cohesionhighly
  affected by external relations (e.g.
  neighbourhood)
• Multi-level governance is key questionhow do we
  adapt existing structures?do we need new set-ups
  (Council level, EGTCs, etc.)?how do we ensure
  macro-regional interest fitting EU?
• CoR is working politically through its
  interregional groups
• Baltic Sea
• North Sea
• Saar-Lor-Lux (The Greater Region)
• Danube
• Mediterranean

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Source Prof. Esko Antola(Centrum Balticum)
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European networking.e.g. satellite-based
regional innovation

• NEREUS
• Network of European Regions Using
• Satellite infrastructure-based services
• Implementation cooperation, exchange of best
  practices, input to policy-making
• broad range of intervention areas relevantfor
  local and regional authorities
• environment, emergencies and security(urban
  transport, spatial planning, flooding, fire,
  pollution control)
• Regional clusters are also often at the core of
  the research, technological development and
  experimentation of innovative systemsof
  satellite-based services

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Territorial cooperation.e.g. Technological Top
Region (NL / BE / DE)

• Aim Triple helix  at cross border
  level(business / knowledge institutions /
  government)
• Partners Provinces of Limburg and North Brabant
  (NL), Provinces of Brabant, Limburg and Liege
  (BE), Land of North Rhine-Westphalia (DE)
• Focus three clusters chemicals and advanced
  materials, High Technical Systems (Engineering),
  Health Sciences

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Development cooperation

• Regions and cities are essential actors to
  assist development countries
• Decentralised cooperatione.g.Germany? 750 Mio
  Spain ? 440 Mio
• Commitment must be kept, efficiency must be
  improved, coordination is needed
• New instruments
• Cartography of decentralised development policy
• Establishment of an exchange of decentralised
  development cooperation

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The engagement of the CoR
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Berlin Declaration 25 March 2007

•    There are many goals which we cannot achieve
  on our own, but only in concert. Tasks are shared
  between the European Union, the Member States and
  their regions and local authorities
• - European Heads of State and Government, in
  the Berlin Declaration on the occasion of the
  50th anniversary of the signing of the Treaties
  of Rome, Berlin, 25 March 2007

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The Committee of the Regions commitment

• European Summit of Regions and Cities
• Prague, 5-6 March 2009 - Regions and cities for
  Europe
• 600 participants Mayors, President of Regions,
  EU Institutions
• Main messages- regions and cities are key
  players in economic recovery- need to coordinate
  between different levels of government- added
  value of the European common policies as common
  level playing field - relevance of the European
  Elections, June 2009
• http//www.praguesummit2009.eu

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Signing of the Lisbon Treaty, 13 December 2007
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Lisbon Treaty prospects for MLG

• New definition of subsidiarity LRA dimension
  (art. 5 TEU)
• New actors regional parliaments (Pcl. on
  subsidiarity)
• Strengthened role for national parliaments (art
  11 TEU, Pcl. on the role of NPs in the EU, and
  Pcl. on subsidiarity proportionality)
• Strengthened role for the CoR
• Subsidiarity defence before the ECJ (Pcl. on
  subsidiarity)
• Privileged access to ECJ in defence of
  prerogatives (art 263 TFEU)
• Consulted in new areas as climate change energy
  (art 307 TFEU)
• Territorial cohesion as an objective of the Union
  (art 3 TEU) RLA dimension to be better taken
  into account in EU policy making.

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Lisbon Treaty prospects for MLG (2)

• EU to respect the internal constitutional and
  political structure in MS, inclusive of local and
  regional self-governance (art 4 TEU)
• Regulatory impact of EU legislation on RLAs is to
  be taken into account (Pcl. On subsidiarity)
• Promotion of social dialogue (art 152 TFEU)
• Provisions on democratic principles and the
  Citizens initiative gt a tool for civil society
  dialogue, platforms and action? Towards a more
  participative democracy based EU? (Art 9-11 TEU)
• Convention method is ordinary method for Treaty
  change (art 48 TEU)

36
The Committee of the Regions White Paper on
Multilevel Governance - Objectives Building EU
in partnership

• Renewed partnership based Community method
• Consolidated constitutional framework
• Developed culture of interinstitutional and
  political cooperation
• Enhanced participation in the European process
• Reinforced effectiveness of Community action
•  Regional and local authorities are genuine
  partners rather than mere intermediaries 

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Definition of multilevel governance

• Coordinated action based on partnership and aimed
  at drawing up and implementing EU policies
• Dynamic process with a horizontal and vertical
  dimension, which does not dilute political
  responsibility

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10 examples of multilevel governance

• The Covenant of Mayors committing and
  cooperating in the fight against climate change
• The Euro-Mediterranean regional and local
  Assembly (ARLEM)
• Open Days European Week of Regions and Cities
• Decentralised communication
• European cohesion policy leverage effects for
  Community policies

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Signing of the Covenant of Mayors, 10 February
2009
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10 examples of multilevel governance

• The Lisbon Monitoring Platform of the Committee
  of the Regions
• The Subsidiarity Monitoring Network
• An integrated maritime policy for the European
  Union
• The Strategy for the Baltic Sea region
• The European Grouping of Territorial Cooperation
  (EGTC)

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The Committee of the Regions commitment

• The Lisbon Monitoring Platform
• gathers 114 regions and cities from 26 EU
  countries
• allows an exchange of best practice and mutual
  learning
• monitors the advancement of the Jobs and Growth
  Strategy on the field
• analyses the Economic Recovery measures
  undertaken at local and regional level
• Currently open consultation on the strategy post
  2010 for Growth and Jobs
• http//lisbon.cor.europa.eu

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The Committee of the Regions commitment

• Territorial cooperation and EGTC
• European Grouping of Territorial Cooperationnew
  legal tool to stabilise cooperation between
  regions,local authorities and national
  authorities strongly demanded by the CoR
• CoRs EGTC Expert Group 40 Members from 23
  different Member States
• Investigation on added value of EGTC with
  respect to scope (including RDI) and scale of
  territorial cooperation
• 5 EGTCs already established, about 30 on the
  pipeline across Europe
• http//www.cor.europa.eu/egtc.htm

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The CoR and the Academia
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CoR and Academia

• Thesis Competition
• Since 1996 annual doctoral thesis competition
  onLocal and Regional authorities in the European
  Union
• The purpose of the competition is to
  rewarddoctoral theses defended during two
  previous years
• Around 50 candidatures per year
• http//www.cor.europa.eu
• studies_at_cor.europa.eu

45
CoR and Academia

• Ateliers on Multilevel Governance
• key activity driven by the newly created CoR
  Cellule de Prospective
• gather academicians (around 60 contributors so
  far)around topics relevant for Multilevel
  Governance
• Five Ateliers realised since September 2008
• The (new) concept of multilevel governance
• The legal and political instruments of multilevel
  governance
• Strengthening multilevel governance in key EU
  policy
• Multilevel governance in a multipolar world
• Fiscal federalism
• Helped to prepare the CoR White Book on
  Multi-level Governance(adopted by Plenary on 17
  June) and its follow-up Action Plan
• http//www.cor.europa.eu/ateliers

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CoR and Academia

• Open Days 2009 The University
• (in cooperation with DG REGIO)
• Bringing together academics on questions related
  toregional development, territorial cohesion and
  innovation.
• Working together with universities and
  associationsand networks specialised in the
  field such asthe Regional Studies Association or
  theEuropean observation network for territorial
  development and cohesion (ESPON)
• http//www.opendays.europa.eu

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Thank you for your attention
www.cor.europa.eu