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Cohesion Policy
 The reduction of economic and social
disparities between richer and poorer regions.
 Enlargement increases disparities
 European Regional Development Fund
 Integrated Mediterranean Programs
 Delors: ‘regional disparities can become
permanent source of political confrontation.’
 Single European Act –cohesion becomes a
fundamental objective
Cohesion Policy
 1988 reform (Delors 1 package):
 Double structural funding
 Economic development
 Principles of additionality and partnership
 Concentrated on specific objectives
 Promotes regionalism in Europe.
 1992 Delors II package: increases structural funding
 Enlargement to Central and Eastern Europe
 Effectiveness of cohesion policy
 Ireland versus Greece
Turkey and Cohesion Policy
 Pre-accession instruments. Development
projects in many regions of Turkey.
Source: Zeynep Özler (EU specialist- İktisadi Kalkınma Vakfı), Kriter
Türkiye- AB İlişkileri Haber- Yorum Dergisi, December2006, Issue 6,
Page 46.
Top 10 Least Developed Areas in the
EU
Top 10 Most Developed Areas in the EU
1. Inner London (Britain)
315
1. Lubelski (Poland)
32
2. Brussels (Belgium)
235
2. Podkarpackie (Poland)
33
3. Luxembourg (Luxembourg)
213
3. Warminsko - Mazurski (Poland)
34
4. Hamburg (Germany)
188
4. Podlaski (Poland)
35
5. Paris (France)
176
5. Swietokrzyskie (Poland)
36
6. Vienna (Austria)
173
6. Eszak Magyaroszag (Hungary)
37
7. Berkshire, Buckingshire, Oxfordshire
(Britain)
162
7. Upolskie (Poland)
37
8. Autonomous Bolzano state (Spain)
160
8. Eszag-Alföld (Hungary)
38
9. Stockholm (Sweden)
158
9. Vichodne Slovensko (Slovakia)
39
10. Oberbayern (Germany)
158
10. Latvia
39
TURKEY
11. TR42 (Kocaeli, Bolu, Sakarya,
Yalova, Düzce)
TURKEY
53
11. TRB2 (Van, Muş, Bitlis, Hakkari)
10
According to the PPP (EU-25=100)
Source: Zeynep Özler (EU specialist- İktisadi Kalkınma Vakfı), Kriter Türkiye- AB İlişkileri Haber- Yorum Dergisi,
December2006, Issue 6, Page 47.
Economic Policy Coordination
 2000 Lisbon Strategy:
To become the most competitive and dynamic knowledgebased economy in the world capable of sustaining economic
growth with more and better jobs and greater social
cohesion.
 Broad Economic Policy Guidelines, since 2003
 Multilateral surveillance of member state economic
performance
 2005 Mid-term Review of Lisbon Strategy
 Not sound performance, Lisbon strategy simplified and
relaunched.
 Emphasis on social and environmental pillars
 Lisbon Strategy replaced by EU 2020 strategy in June 2010
 Guide Europe’s economy our of recession
 Smart growth, sustainable growth, inclusive growth

The 5 targets for the EU in 2020
1. Employment
 75% of the 20-64 year-olds to be employed
2. R&D / innovation
 3% of the EU's GDP (public and private combined) to be invested in
R&D/innovation
3. Climate change / energy
 greenhouse gas emissions 20% (or even 30%, if the conditions are right)
lower than 1990
 20% of energy from renewables
 20% increase in energy efficiency
4. Education
 Reducing school drop-out rates below 10%
 at least 40% of 30-34–year-olds completing third level education
5. Poverty / social exclusion
 at least 20 million fewer people in or at risk of poverty and social
exclusion
Single Market
 Continuous process
 1992 Program
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Removing physical barriers
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Free movement of goods
Free movement of people
Removing technical barriers
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Standards, testing, and certification
Movement of capital
Public procurement
Free movement of labor and professions
Free movement of financial services
Transport
New technologies
Company law
Intellectual property
Company taxation
Single Market
 1992 Program (cont.)
 Removing fiscal barriers
 Value-added tax
 Excise tax
 International trade
 Beyond 1992
 Transition periods and derogations
 Liberalization of energy and telecommunications
 Transposition into national law
 The proliferation of new trade barriers.
 Services directive (2005)
Single Market Act 2012
 12 Levers to Boost Growth
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Access to Finance for SMEs
Mobility for Citizens
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Recognizing professional qualifications- European professional card
Intellectual Property Rights –a single European patent
Consumer empowerment
Services
Networks: energy and transport infrastructures
Digital single market
Social entrepreneurship –cooperatives
Taxation –energy taxes
Social cohesion
Business environment
Public procurement
Competition Policy
 Instrument of economic reform in order to
boost competitiveness and growth
 Antitrust regulation
 Mergers
 State aid
 Regulated industries
 Independence of commission
 International dimension
Microsoft and EU Competition
Policy
 March 2005, EU orders Microsoft to pay 497 million
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euros
Microsoft pays the fine and appeals the decision in
the European Court of First Instance
In 2005 and 2006, additional fines for not fully
complying with the ruling.
In 2007, Microsoft loses the case and announces it
will not appeal anymore
In 2008, EU fined Microsoft 899 million euros for
failure to comply with the decision. Microsoft lodged
an appeal.
Financial Crisis and EU
Competition Policy
 State aid to financial institutions
Exceptional circumstances: state aid is allowed to
correct for a serious disturbance that affects the
entire economy of a member state.
 Tension between short-term financial stability and
medium-term competition.
 State aid to real economy
 Temporary Framework enabling member states to
adopt new support measures until 2010
 Opel, Renault
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Turkey and Competition Policy
 Requirement of Customs Union agreement
 Competition Agency –successful in anti-trust
cases
 Insufficient development in state aids
 Regional rather than sectoral subsidies