Europe’s challenges call for more territorial cooperation

Europe’s changing economic geography is accompanied by an increasing fragmentation of society and places. Inequalities between and within countries, regions and cities are a main driving force of fragmentation and lead to the question of how Europe should look like in the future. The achievements of European integration at risk and the future depends much on how Europe will address the challenges of these fragmentation risks and at the same time, the growing interdependencies between places.  

The positive and negative developments in one place imply effects in other places and demand a wider geographical perspective of policy decisions to strengthen links between places rather than driving places and thereby Europe apart. The mismatch between the impacts of economic and societal developments and the geographical jurisdictions of decision making raises issues about efficiency and legitimacy. The risk of further increasing spatial disparities is present. Current trends – not least technological developments – are expected to further accelerate the above challenges and disparities between places.

Still, the future of Europe is not determined by only one possible direction. Various scenarios show different possible futures. No matter where decision-makers and people decide to go, high-quality governments and flexible governance arrangements are key to overcome the mismatch between impacts and jurisdictions and to address interdependencies between places.

A shared vision for Europe

The ESPON project "European Territorial Reference Framework" (ETRF) recalls that the obvious basis of effective policy answers for the future is a shared vision of the direction in which Europe is going. The project provided a brief look into the territorial dimension of the key challenge of fragmentation, building upon the work of previous research and identified the Gross Domestic Product (GDP) as the main indicator -often used as a proxy- to assess the economic performance of regions, e.g. for cohesion funds eligibility.

GDP, however, includes items not directly related to a feeling of being well-off (e.g. corporate income taxes, undistributed corporate benefits). ETRF suggested that income data (primary income per capita, in PPS), might allow to better depict the well-being of residential populations.

By combining absolute income data for 2016 with average annual growth rates for 2006-2016, both the current level (static) and the development perspective over time (dynamic) can be covered. The project found that people in regions with high levels of income but a negative outlook are probably more pessimistic than people in regions with lower levels of income but positive future perspectives due to better performance.

The ETRF provided a map that compares the value of each region to its respective national average, as due to media, language and cultural ties, people tend to compare their situation with their fellow nationals rather than with the situation in countries beyond their own national borders. In order to identify regions very close to the national average and avoid confounding them with regions further apart, thresholds have been set for both dimensions resulting in three classes for each dimension (below, around, above national average) and consequently in nine groups.

The nine groups have been merged into five final categories:

  • Front runners: Regions with high levels of income and medium-high growth rates; mainly located in capital regions and strong economic regions like southern Germany, northern Italy or Catalonia.
  • Catching-up: Regions with low-medium levels of income and high-income growth; mainly in central Europe and peripheral areas (e.g. Scottish Highlands, Galicia/Norte, outermost regions).
  • Losing pace: Regions with medium-high levels of income and low-income growth; found all over Europe and around some capital areas; some might be at risk of being left behind in the long run.
  • Left behind: Regions with low levels of income and low-medium income growth; mainly located in southeast and southern Europe but also in France, the United Kingdom and central Europe.
  • Median: Regions with a medium level of income and medium income growth; found in almost all countries (except for southeast Europe), they can be understood as representative of their country

Based on the findings of the ETRF and relevant studies from ESPON and other organisations and institutions, the draft of the New Territorial Agenda emphasised the quality of life as one of the fields where action is needed. According to the document, "the underlying objective of all public policies is to increase citizens’ well-being and quality of life", that has a territorial dimension ranging from disparities between neighbourhoods to disparities between regions and countries. The draft of the New Territorial Agenda proposes to focus on "multiple factors that influence what people value in life, beyond purely material aspects", such as shortages of natural resources, social disparities and the awareness that economic growth does not necessarily deliver employment. 

The Agenda identifies also the quality of government and governance processes as increasingly important for local and regional development and a factor that is linked with the well-being of the society, noting that cooperation across different levels of government and governance to develop and implement place-specific strategies are not used widely enough.

The new Territorial Agenda is expected to be adopted by the ministers responsible during the German presidency and aims to strengthen the territorial dimension of policies at all governance levels.

More information

Article edited by Gavin Daly and Nikos Lampropoulos, Project Expert Press and Media Activities