Significance and Implications of Regional Disparities within the EU - Research Paper Example

Significance and Implications of Regional Disparities within The EU al Affiliation) Introduction The European Union (EU) was set up in the year 1945 after the termination of the Second World War. The union was formed due to the great need of putting a stop to the frequent wars that had been dogging the European neighbor countries. This regional policy was also set up to help strengthen the European countries as a bloc and to also support economic benefits to all its member countries by creation of employment opportunities, promoting healthy competition among member states, improved standards of living and ultimately realizing sustainable development all round (Europeanization, n.d.). There has been increased distress for some time however as a result of the high inequality levels among the member states, this posing as a major challenge to the leadership of these countries to find rapid solutions to help reduce these disparities, resulting in the formation of the EEC Treaty in 1957 as a means of promoting the growth of each country and the union itself (Laffan & Stubb, 2003). The objective to realize socio-economic cohesion in the EU is still as active as ever in the EU, as is evident in the Lisbon Treaty of 2007. However, strengthening the EU has not always realized the desired outcomes, as standards of living in some regions have not been at par with others (European Voice, n.d.). The expansion of the EU has also increased the level of disparity between some member states as some are more urbanized while others are rural and underdeveloped and are highly reliant on lower levels of technology in their advancement (EUROPEANIZATION, n.d.) In this paper, the major consideration will be the 2008/2009 recession and the adverse effects it had on the economy, as well as recommend policies that would aid in a reduction of the disparity between member countries which would ultimately result in improved service delivery, improved standards of living and economic development of member countries and the union as a whole giving room to a stronger union (Malmstrom, n.d.). Types of Disparity Reinforcing measurements of inequalities in the region is crucial in providing insights to assist in the setting up of policies that would be used to address them effectively. Different countries view these disparities differently. For instance, some countries view marginal and less populated places as disadvantaged while in other countries do not really view them as such. It is also notable that the relation between regional policy and lack of equality is not always clear. EU member stated show a variety of preoccupations that indicate their difference in level of economic development, geographical set up, social issues and also their own internal disparities (European Voice, n.d.). The major disparities to be discussed include: Physical (Relating to geographical and topological set up) Economic (Concerned with the measure and value of output) Social (Relating to living standard and revenue/income of the nationals) Physical Disparities There is a great diversity in the physical features around the EU. For example, the mountains in France, scrub vegetation of Spain among many more. There are also major differences in size of the various countries, which in turn indicates a big difference in population spread in such areas. Physical disparities, however, are mainly a determining factor in Nordic Countries within the EU where climate change is a major factor in developing appropriate regional policies (The challenges of Europe, n.d.). There are also geographical challenges faced by the four Cohesion countries relating to borders of such countries in the domestic sense and also in relation to the entire EU. There is a need to mention that there are great differences between physical, social and economic disparities, these physical differences being factors that would be impossible to change (EU to measure climate emissions from ships, n.d.). This has therefore provided the relevant authorities tasked with formulating policies that almost never factor in issues relating to topological disparities. This is important in relation to competition systems adopted by the EU which is mainly aimed at promoting investments and improving the creation of job opportunities (Yuill & Wishlade, 1997). Economical Disparities The size, geographical location and also social factors including population density play a major role in the disparities that exist in the EU region. GDP per head is measured to determine the purchasing power of member nations. These range for example from an estimated 190 percent in Hamburg, Germany, to about 42 percent in Alentejo, Portugal. The disparities in the levels of economic development are clearly reflected among the four Cohesion Countries. This is an indicator of the close relationship between regional policy at a national level and the realization of Structural Funds in these nations. Germany and Italy put a lot of emphasis on disparities in economic growth where the economical geography is the clear difference between the new and outdated Länder in Germany and between the north and south in Italy (Yuill & Wishlade, 1997). In relation to policies adopted by the EU, economic growth, which is calculated in terms of GDP per Capita income, influences highly the right of use of Structural Funds and are a major determinant in reviewing by authorities charged with setting up competition policy (Economy, finance and tax - European Commission, n.d.). Social Disparities This type of disparity is mainly concerned with lack of equality in the social structure, mainly putting more emphasis on the level of standards of living among the member states as well as the income attributed to these countries. It is however crucial to understand the difference between income generated in a specific region as a measure of the GDP and success of the people living in that particular region as there are no clear links between differences in income regionally and interpersonally (Economy, finance and tax - European Commission, n.d.). Countries like Germany and Spain for instance have clear constitutional structures to assist in creating equal living standards. In regions like the UK, issues relating to the creation of employment principally concern disparities, as they aim to reduce imbalances concerning job opportunities. Over the period between 2000 and 2005, certain countries have experienced an increment in employment opportunities while others recorded a reduction, including the likes of Romania and Poland. So as to realize the Lisbon job placement rate targets, the EU needs to come up with a way to provide about 23.3 million more employment opportunities, which should be divided as follows: 7 millions opportunities for women, and another 7 million for the ageing population between 55 and 64 years of age (Employment and social rights - European Commission, n.d.). This job creation would require a high level of investment in new ventures matched by effectively trained workforce to fill these opportunities (Yuill, & Wishlade, 1997). Indicators of Regional Disparity As the disparity in countries within the region continue to emerge, certain situations that have led to such differences have come about, in a bid to be able to provide effective solutions to enable realization of the vision that led to the Lisbon Treaty being born (The challenges of Europe, n.d.). As earlier discussed, there has been a growth in employment rates between 2000 and 2005 but even with this increase in opportunities, some countries have found it hard to achieve successes that have been realized in some of the other member countries (Key challenges, n.d.). It has been recorded that there was a decline in unemployment levels from 13.4% to 12.4 in these regions, although they were still lagging behind the more developed countries whose unemployment rate was at 8% (Commission of the European Communities, 2007). Poverty still remains a major detriment to the desired equality of member countries. The proportion of the population that is in danger of poverty remains quite high in some countries, these countries having a national income of about 60% below the national median revenue. In 2004, countries such as Poland, Ireland, Spain, and Greece among others had reached levels of around 20% while only 10% in Holland, Czech Republic and Sweden. There was a great risk of poverty in 16% of the EU inhabitants during this period, a higher risk facing women, the young, the aged generation and the jobless (commission of the European Communities 2007). Although there was an increase in levels of education, with education being an integral part in providing the economy with well-trained and highly qualified workforce, these advancements were still lagging far behind some other member states with a far more productive workforce (Quora, n.d.). In 2005 for example, 23% of young adults in the EU had been educated up to the tertiary level. On average, the regions that are languishing behind have smaller number of people in the productive workforce bracket (commission of the European Communities, 2007). Evidence suggests that within the member states, economic activities are being undertaken more in capital cities all through the region. This has led to the region’s growth in GDP by 9%, the population also experiencing an increment of about 2% between 1994 and 2000. Although an increase in population in these urban areas can help the countries’ economic growth in the short-term, it can be a recipe for disaster in future as emerging issues such as fall in the number of housing, increased congestion, increased pollution rate, fewer job opportunities thus resulting in rise of unemployment levels would result in a decline in growth of economies of member countries and this would also translate to the economy of the EU in general (Malmstrom, n.d.). There has been an increase in the emergence of suburbanization around cities in Europe (Challenges Facing Europe in a World of Globalization, n.d.). A large number of people have embraced this by moving into suburbs as compared to the core of the cities. This in turn led to the decline of the once popular city centers as well as a decline in the city economies. This influx of people in suburban areas resulted in straining transportation and other resources resulting in a decline in housing facilities and also increased unemployment levels which ultimately serve as economy killers (Commission of the European Communities, 2007). Rural areas suffered a reduction of population as people moved to the urban areas to search for employment and also better facilities in terms of education, housing among others. This was evident in parts of South Italy, Sweden, Scotland, among others. This in the long run resulted in leaving these areas with a majority of people composed of the ageing population whose productivity is below par and this resulted in a decline in the economy of such areas (Quora, n.d.). Policies to Aid in Reducing Disparity in the EU region The problem of disparity in the EU has provided a major challenge in the region realizing its greatest potential and it is for this reason that it has embarked on a number of policies that are aimed in alleviating these challenges and therefore improve the level of economical growth within member states, especially those adversely affected by the major difference compared to their counterparts and also promoting improved inter-relations between its member countries that would serve as a way to reduce this inequalities (Hanf & Soetendorp, 1997). One of such policies is the increasing of cross-border exchanges, which have greatly aided in improved relations between border regions within the union, especially in countries such as Germany and France. Increasing easy passage at these borders would go to great lengths at promoting economic trade and this would help the region also realize its economic potential (Agenda 2000, 1997). The prevention of dangerous climatic change is very high on the agenda list of the EU (The challenges of Europe, n.d.). Europe is working tirelessly to reduce greenhouse emissions, serving as an encouragement to other countries to follow suit as the cost of not taking action would be far much expensive in the long run. To prevent adverse effects of climate change, the international community has decided to keep global warming below 2 degrees Celsius. Under the Kyoto Protocol, the EU-15 pledged to lessen their collective emissions to 8% under those that were in 1990 thus serving as a means to help the union attain its future ambitions (Employment and social rights-European Commission, n.d.). The creation of job opportunities has been at the forefront in ways in which the EU plans to promote cohesion; the reform of this policy for 2007-2013 is crucial to realizing this (Employment and social rights - European Commission, n.d.). There is a need for the EU to undertake a strategic approach that will aid in administering cohesion policy at national level down to the local level. This approach should ultimately provide a framework to realize an improvement in effectiveness of the economy and also promoting transparency and accountability of the political class. The renewed Lisbon Strategy has prioritized the creation of a structure that would assist in formulating national strategies under policies seeking to promote cohesion (The Future of EU Regional Policy, 2008). In December 2005, crucial systems were put in place to effectively carry out the distribution of resources among member states with a view to enhance improved investments that would bring about more employment opportunities as compared to the existing levels. There was an estimated increase of about 200 billion Euros set aside to actualize this vision (Bache, 2000). Sound financial management and the setting up of proper control standards is important in ensuring that the cohesion policy is administered as initially intended (Hussain, 1990). To achieve such high standards of regulation of resources, a clear set of regulation would go a long way in achieving this (Fourth Report on Economic and Social Cohesion, 2007). For example, a commission was set up between the years 2007-2013 to regulate the set up programs as a replacement for that which was in place in the period 2000-2006. The regulations for the management of projects that receive their funding from the Cohesion Fund have been made parallel with those of the Structural Funds, thus making sure that the management of funds is efficient (Hooghe, 1996). Setting up clearer rules in relation to information can also form part of the solution to this disparity issue. Individuals who benefit from allocated funds in the member countries should be provided with equal access in receiving information and financial support opportunities from the Cohesion Policy. His will go a long way in minimizing wastage of time and effort in accessing such information (The Future of EU Regional Policy, 2008). Increasing proportionality of control systems, as well as simplifying then can also be a great way to promote the reduction in disparity levels among member countries (MEPs endorse Juncker investment plan despite criticism, n.d.). Some of the control arrangements of less detailed programs can be tasked to national bodies set by the existing rules, and this will assist in lessening the need for compliance with set up community audit requirements (The European Information Association, n.d.). Technology advancement in the EU member countries has grown exponentially. For this reason some electronic systems have been set up and this has helped in the ease and convenience in the way in which communication and governance of certain systems can be accomplished by just a simple touch of a button. This emergence of electronic data exchange and governance can save a lot of time in coordinating of programs and also serving as a way of curbing unnecessary disagreements among member states for example in the amount of information provided (The European Information Association, n.d.). Conclusion The EU is a major financial bloc in the world economy and it is for this reason that it is crucial for the leadership of these member countries as well as the EU itself incorporate some or all of the policies discussed above as well as improve the existing ones so as to provide an equal playing field to in member countries in terms of providing efficient and effective systems such as continued funding for investments to its member countries (European Union Studies Association, n.d.), especially the ones that are still lagging behind economically as compared to the other members to provide them with an opportunity to also realize the same levels of economic growth as those countries that are doing far much better (Hussain, 1990) (World business, n.d.). It is also important for the relevant authorities to put in place easily understandable and highly efficient structures that will aid in the governing of projects that may be started as a way of improving the level of disparity among the members as the future holds a lot more promise for the member countries in regards to improved positive competition, better levels of co-operation among the members as this would positively impact the region as a whole (Agenda 2000, 1997), (Euro-Politics: Institutions and Policymaking in the New European Community, n.d.) If these cohesion policy programs are fully utilized, it is very evident that the countries that are still lagging behind their counterparts can catch up and ultimately take the union to greater heights (Europe2020, n.d.). References Agenda 2000 - For a stronger and wider Union. (1997). Bulletin of the European Union, 5(97), 1-128. Bache, I. (2005). Europeanization and Britain: Towards Multi-level Governance? 1-17. 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Regional and Industrial Policy Research Paper, 24, 1-32. (n.d.). Retrieved November 27, 2014, from http://www.europeanaccess.co.uk challenges/index_en.htm Read More