European funds are the main financial means with which the European Union pursues the aim of economic and social integration of the member countries with the preparation of programs concerning various sectors.
Cohesion policy as the main source of funding
Among the sources of funding of the European Union we can say that the main one is the Cohesion Policy. This form of support aims to promote economic growth, job creation, business competitiveness, sustainable development and improve citizens’ quality of life. To achieve these goals and address the different development needs across EU regions, €392 billion, almost a third of the total EU budget, has been set aside for cohesion policy for 2021-2027.
There are several funds that make it up:
- The European Regional Development Fund (ERDF), to invest in the social and economic development of all EU regions and cities.
- The Cohesion Fund (CF) to invest in the environment and transport in less prosperous EU countries.
- The European Social Fund Plus (ESF+), to support employment and create a fair and socially inclusive society in EU countries.
- The Just Transition Fund (JTF) to support the regions most affected by the transition to climate neutrality.
Cohesion policy: Fund allocation methodology
The allocation of EU funds is always based on the Berlin formula adopted by the European Council in 1999.
This formula provides that different calculation systems are applied for the allocation of funds, distinguishing three areas:
- less developed
- in transition
- more developed.
It is a methodology that takes into account various variables including the difference between the per capita GDP of a region and the EU average.
The goal is to encourage the development of less developed areas and reduce socio-economic disparities, also strengthening support for regions in industrial transition.
EU countries by level of development
Among the least developed member states (GDP per capita below 75% of the EU average in 2015) we find Bulgaria, Greece, Estonia, Croatia, Latvia, Lithuania, Hungary, Poland, Romania.
The moderately developed/transition states (GDP per capita between 75% and 90% of the EU average) are the Czech Republic, Cyprus, Portugal, Slovenia, Slovakia.
While the most developed states (GDP per capita above 90% of the EU average) are Belgium, Denmark, Germany, Ireland, Spain, France, Italy, Luxembourg, Malta, Holland, Austria, Sweden, Finland, United Kingdom).
In Italy the most developed regions are Piedmont, Valle d’Aosta, Liguria, Lombardy, the Autonomous Province of Bolzano, the Autonomous Province of Trento, Veneto, Friuli-Venezia Giulia, Emilia-Romagna, Tuscany, Umbria, Marche and Lazio.
Allocation of cohesion policy funds 2021-2027
The states that will benefit from substantial aid are the following:
- Poland in first position with support amounting to €72,724,130,923
- Italy with support amounting to €43,463,477,430
- Spain with support amounting to €38,325,138,562
- Romania with support amounting to €30,765,592.53
While other countries will receive the following support:
- Portugal €23,861,676,803
- Greece €21,696,841,512
- Czech Republic € 20,115,646,252
- Hungary € 20,247,570,927
- France €18,058,025,615
- Germany €17,681,335,291
- Slovakia €13,304,565,383
- Bulgaria €10,081,635,710
- Croatia €9,888,093,817
- Lithuania €6,359,291,448
- Latvia €4,612,229,539
- Estonia €3,285,233,245
- Slovenia €3,463,528,447
- Belgium €2,754,198,305
- Sweden €2,413,092,535
- Finland €1,808,501,037
- Netherlands €1,625,023,473
- Austria €1,442,289,880
- Ireland €1,226,203,951
- Cyprus €988,834,854
- Malta €672,802,893
- Denmark €646,380,972
- Luxembourg €73,122,377
Cohesion policy 2021-2027 will focus resources on five strategic objectives:
- “Smarter” Europe (innovation, digitization of economic activity and public administrations, transformation of the economy, support for small and medium-sized enterprises);
- Greener Europe
- More connected Europe
- more social Europe
- Europe closer to citizens
Investments in the innovation of companies involved in food processing and which are interested in the modernization and consequent purchase of technological food processing machinery, including those of Inox-Fer, also fall within the context of a more “intelligent” Europe .
The level of funding depends on the region and the size of the company, starting from 25% up to 75% non-refundable.
We advise you to check the following link to verify the funds set up by the EU