ECONOMY

Less EU aid after 2006

Brussels – Several Greek regions, representing 48 percent of the country’s population, will become ineligible for aid through the European Union’s structural funds after 2006, an interim report on the EU’s regional policy reveals. The report will be presented next Wednesday by Michel Barnier, the EU’s commissioner for regional policy and institutional reform. The reason for the ineligibility is EU enlargement, comprising mostly Eastern European countries. Of the 10 new members, only Cyprus and Slovenia have a per capita income comparable to, or higher than, Greece’s, while the other eight are far behind. As a result, income in regions such as Attica, Central Greece, South Aegean and (quite likely) Central Macedonia will exceed 75 percent of the EU average, the threshold above which regions are ineligible for EU aid. Although the enlargement will take place in May 2004, funding for Greek regions is secure until the Third Community Support Framework (CSFIII) is completed in 2006. Despite occasional denials, there will be a CSFIV, but it will be less than CSFIII, although applied to 10 more members. This is because EU donor states (10 out of the current 15) have become increasingly stingy, especially Germany. This is bad news for Greece, currently the EU country most dependent on aid. In 2001, the net inflow of EU funds into Greece was equal to 3.50 percent of the country’s gross domestic product. The second most dependent country, Portugal, benefits from net EU inflows equal to 1.53 percent of its GDP. The other net beneficiaries of EU aid are Spain (1.24 percent), Ireland (1.13 percent) and the United Kingdom (0.05 percent).