ECONOMY

EU gives poorer regions a shot at new technologies

The European Commission wants to help the European Union’s poorest regions enjoy the benefits of modern technology by taking advantage of aid through the so-called structural funds. The Commission announced yesterday that it will allow, and even encourage, the diversion of structural funds earmarked for other projects toward co-financing projects of high-tech telecommunications networks in regions where such investments by the private sector alone are not profitable. These areas are hampered by low economic development, sparse populations and difficult terrain. In Greece, such areas include Epirus, most of the Peloponnese, and several islands. In these areas, the chances of profitable private investments are practically zero. The projects for which more funds will be made available include the installation of broadband telecom networks and their support structure (cable and fiberoptic networks, antennas, etc.) and could also be extended, under certain conditions, to the construction of mobile telecommunications relay stations. The Commission sets a number of criteria for these projects. Besides the geographical and economic parameters, it insists on the project being «technologically neutral.» In other words, the network to be constructed cannot determine in advance the technology used but must be compatible with a certain spectrum of technologies. Consumers, the Commission believes, cannot become hostages to a single technology, which might become obsolete or dated within a short period. In case there is a mandatory choice between one type of technology over another (for example, cable over wireless connections), the choice must be defended through detailed cost-benefit analysis. In any case, the infrastructure, whether in its technology or access points, must be open to all interested providers and not just to the locally dominant provider of telecommunications services or the company that co-finances the project. The construction of second-generation mobile telecommunications relay stations will only be allowed in areas that are not covered by any provider. The stations must be open to use by all mobile telecom services providers active in each country. Finally, the Commission stresses that each proposed investment should fulfill the criteria concerning state subsidies and open market competition. Proposals must be submitted by the regions themselves.