Smart Specialisation – The Driver of Future Economic Growth in Europe

24112011_383To achieve future growth our investment strategy towards the regions is becoming more selective and strategic. Smart specialisation involves putting in place tools, institutions and experts to help the regions find their own industrial and technological niche in the global marketplace. This approach will help regions recognize their true innovation potential and refocus their industrial structures towards emerging industries and international markets.

Johannes Hahn, European Commissioner for Regional Policy

We have come a long way since the days when we had to convince critics of the importance of cohesion policy for generating economic growth. Indeed cohesion policy now features at the heart of the European agenda and the current budget negotiations. It is now seen as a strategic investment policy, a mechanism for cushioning Europe against the economic crisis and a way to sow the seeds of future growth.

To achieve this, our investment strategy towards the regions is becoming more selective and strategic. As you can read in our article on Smart Specialisation, we are putting in place tools, institutions and experts to help the regions find their own industrial and technological niche in the global marketplace. This approach will help regions recognise their true innovation potential and refocus their industrial structures towards emerging industries and international markets.

Smart specialisation is an innovative strategy for regional economic transformation and is now a key part of Europe’s efforts to help its regions work their way out of recession. It implies that a region selects a limited number of priorities on the basis of its own strengths and international specialisation. The strategy requires that support and investment actions are not fragmented and that Structural Funds are concentrated on a limited number of priorities, those with the highest development potential. Indeed the development of research and innovation strategies based on the concept of smart specialisation will be one of the prerequisites to access Structural Funds as of 2014.

 

Rebalancing the investment mix

The classical approach to investment is no longer appropriate. Our emphasis is now on thematic investment, prioritising strategic areas and ensuringthat we get a mix of investments that is appropriate to the needs of each region. In some countries too much has been invested in infrastructure and not enough in SMEs and employment. Our re-programming exercise is changing the balance, since to have real impact and

make a difference there has to be a critical mass of investments. Over the past three years some EUR 20 billion has been reprogrammed between investment themes. A further EUR 14.5 billion has been freed up by reducing national cofinancing requirements and increasing to 95% the maximum co-financing rate in the ‘programme countries’.

 

Emphasis on results

We are putting increasing emphasis on results, performance and value for money for tax payers. An evaluation of regional investments made in the 2000-2006 period (see page 36) highlights the importance of clearly defining objectives and strategies and undertaking a proper cost-benefit analysis to ensure that the right investments are made for the right reasons. It is clear we need to integrate more milestones and quantifiable targets into programmes so we can assess their progress.

Last but not least, we have some interesting results from the latest Eurobarometer survey which shows that despite the general gloom and the economic outlook, Europeans are generally very positive about the quality of life they enjoy in their region!

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